The American Civil Liberties Union, ACLU of Oregon and Electronic Frontier Foundation are asking the full 9th U.S. Circuit Court of Appeals to rehear the case of Mohamed Osman Mohamud, a Somali-born, naturalized U.S. citizen, after a three-judge panel in December upheld his conviction for attempting to bomb a Portland, Oregon, ceremony in 2013 (see 1607050073). The 9th Circuit panel ruled that since the government was targeting a foreign national overseas under Section 702 of the Foreign Intelligence Surveillance Act, no warrant was required to intercept that person's communications or Mohamud's emails that were incidentally collected in the investigation. Section 702 allows U.S. intelligence agencies to collect information about non-U.S. persons located overseas; but critics say Americans' personal information is swept up (see 1605100001). In Monday's amici filing requesting an en banc hearing, the three groups said the panel "improperly" relied on the "incidental overhear" rule to create a new exception to the warrant requirement, but that rule wasn't recognized as an exception. Such a misreading creates "a dangerous end-run around the warrant requirement -- including in ordinary criminal investigations," the filing said. The groups said the panel held that the third-party doctrine "diminished" Mohamud's expectation of email privacy. The advocacy groups said the panel "inexplicably carved out of its decision" the government practice of intentionally searching the Section 702 databases for Americans' communications.

High-ranking government officials from France and Germany are backing EU legislation that could jeopardize encrypted communications across Europe, said Christian Borggreen, Computer & Communications Industry Association director-international policy, in a blog post Friday. He said German Interior Minister Thomas de Maiziere and his French counterpart, Bruno Le Roux, sent a letter last week to European Commission officials seeking legislation in October after both countries' general elections. Borggreen said the letter, which is written in French, is a "u-turn" from the EU's prior "strong opposition" to back doors. He also cited a Politico story that reported an EC spokesperson seemed to endorse the proposal. Borggreen said it's unclear how service providers would give law enforcement access to encrypted data. It would "pose serious risks to the overall security and confidentiality of Europeans’ communications, which seems inconsistent with existing legal protections for personal data," he wrote. The EC's justice spokesman and French and German interior ministry offices didn't respond to emails seeking comment.

Sentinel Labs, SpyChatter and Vir2us settled separate but similar FTC allegations that they allegedly deceived consumers about their participation in the Asia-Pacific Economic Cooperation's (APEC) voluntary data-transfer system, said the commission in a Wednesday news release. Commissioners voted 2-0 to accept the three proposed consent orders, which will be published in the Federal Register soon, for comment through March 24. The commission will then decide whether to make the agreements final. The FTC alleged the companies said in their online privacy policies that they participated in the APEC Cross-Border Privacy Rules system when they didn't. The system "facilitates privacy-respecting data transfers between APEC member economies through a voluntary, enforceable mechanism, which certifies companies as being compliant with ... program requirements," said the FTC. The agency also said security company Sentinel Labs, which also does business as SentinelOne, "falsely" claimed participation in TRUSTe's privacy program. SpyChatter provides a secure messaging app while Vir2us is a cybersecurity company. The settlements bar the companies "from misrepresenting their participation, membership or certification in any privacy or security program sponsored by a government or self-regulatory or standard-setting organization." The companies didn't comment.

IBM launched an ecosystem initiative around its Watson IoT business in Munich, it said in a Thursday announcement. Calling the effort the first “cognitive collaboratories,” IBM said development teams from Avnet, BNP Paribas, Capgemini and Tech Mahindra will collocate development teams at the IBM center, which will also act as innovation space for European IoT standards organization EEBus. IoT innovation has reached a “tipping point,” said Harriet Green, general manager, IBM Watson IoT, cognitive engagement and education, who pegged the number of clients and partners wanting to co-innovate on the IoT ecosystem at 6,000.

Sony is delaying by three months the targeted closing date of the 17.5 billion yen ($153.2 million) sale of its battery business to Murata (see 1610310044), the company said in a Wednesday announcement. Murata and Sony “are continuing the necessary procedures” to complete the sale, but “in light of the current review status of the required regulatory approvals,” the new goal is to close the deal by early July, Sony said. “The rescheduled target closing date remains subject to the receipt of the required regulatory approvals and other conditions.”

The International Trade Commission will undertake the first of three reviews on business-to-business and business-to-consumer digital technologies, including on digital exports that might encounter trade barriers overseas, the agency said in a Friday notice. As part of its first of three planned investigations, the ITC scheduled a hearing April 4. The commission will accept requests to appear at the hearing through March 21, pre-hearing briefs and statements through March 23, post-hearing briefs and statements through April 11, "all other written submissions for the first report" through April 21, and will submit the first of three digital trade reports to the Office of the U.S. Trade Representative on Aug. 29, the commission said. Pursuant to a Jan. 13 request to the ITC by then-U.S. Trade Representative Michael Froman (see 1701180032), the agency anticipates releasing the second report by Oct. 28, 2018, and the third report by March 29, 2019.

Income-based approaches to consumer marketing strategies are outdated, and internet using “connected spenders” is a better indicator of consumers “ready and able to spend on goods and services,” reported the Demand Institute, a nonprofit think tank operated by The Conference Board and Nielsen. Connected spenders will generate 46 percent of the world’s consumer spending over the next decade, when 2.3 billion more consumers will get internet access, said Wednesday's report.

Global Q4 smartphone sales reached 391 million units, up 6 percent year on year, GfK reported Wednesday. Western Europe was the only region to see negative growth with unit sales down 4 percent year on year to 38.6 million and dollar sales off by a percentage point to $16.2 billion. North American unit sales rose 3 percent to 58 million and dollar sales advanced 5 percent to $22.9 billion, it said. Following a dip in Q3 last year, North America experienced a turnaround in demand in Q4, driving by operator promotions and flagship device launches during the holiday season, said the research company. It forecasts that tough competition among North American carriers will drive marginal growth in smartphone demand of 1 percent year on year to 193.4 million units in 2017. Central and Eastern Europe had the steepest rise in the quarter, at 16 percent, posting unit sales of 24.2 million, for $5.6 billion in revenue. China led all smartphone sales with 118.9 million, up 12 percent, grossing $36.9 billion, it said. Smartphone demand is expected to remain stable even in saturated markets this year, said analyst Arndt Polifke, citing their relevance in developed markets for innovations such as virtual reality, artificial intelligence, smart home functionality, mobile payments and mobile health. Polifke said that developing regions such as the Middle East/Africa and emerging Asia “have yet to mature and as such still have significant potential for growth, leading to a solid growth outlook for smartphone demand in 2017."

CTA declined comment on the amici brief signed by dozens of tech companies backing the states of Washington and Minnesota in their fight to keep President Donald Trump’s now-suspended immigration executive order from being reinstated (see 1702060016). “We have not yet reviewed the brief,” CTA President Gary Shapiro emailed us Tuesday. “We stand by our initial statement” two days after the order was first released (see 1701290001) that blocking access en masse of employees of U.S. companies who are lawful visa and green card holders based on religion or national origin raises constitutional issues, Shapiro said. He also testified at last week’s Senate Commerce Committee hearing on reducing unnecessary regulatory burdens that he thinks the immigration order isn’t good for business (see report in the Feb. 2 issue of this publication). Eight more companies, for a total of 135, filed letters of joinder Tuesday adding their support to the tech industry's amici brief against the immigration order. They are Akamai, Credo Mobile, Fitbit, Molecule Software, PostMates, QuantCast, SoundCloud and SpotHero. Oral argument on the Trump administration’s emergency motion to stay a lower court’s temporary restraining order that blocked enforcement of the immigration order was scheduled for 3 p.m. PST Tuesday at the 9th U.S. Circuit Court of Appeals in San Francisco.

As the Trump administration considers Google antitrust issues, the European Commission likely will issue a ruling against the search company, Cowen and Co. analyst Paul Gallant emailed Wednesday. One EC investigation on search bias in online shopping "is still in the pipeline," Gallant said, but "a negative ruling against Google" is likely in the coming months. Such a ruling will be the first of several verticals, including travel and local search, that the EC could use as leverage against the company, which probably won't settle, he said. A second investigation on Android dominance likely will occur in Q3, he said. Citing last week's The New York Times story about Google being an issue for the White House, Gallant said the company "is still viewed as a Democratic company in a Republican town, and [Executive Chairman] Eric Schmidt's campaign efforts for Hillary Clinton may make Google more of a target." Gallant said if either FTC Acting Chairwoman Maureen Ohlhausen or former Commissioner Joshua Wright ultimately helms the commission, their "past statements ... would seem encouraging for Google." But it's unclear if EC action would help or hurt the company in the U.S., Gallant said. The FTC would get cover to reopen its probe and wouldn't appear politically motivated, but the White House may also react negatively to European meddling in a U.S. company, he said. The company didn't comment.