The Tensions between State and Federal Laws in the Context of Preemption - Assignment Example

Intrgrt Bus Fnd w/Ethics DISCUSSION OF THE TENSIONS BETWEEN AND FEDERAL LAWS IN THE CONTEXT OF PREEMPTION From the perspective of federal law, the term ‘preemption’ is defined as a legal term, which is generally used when the Congress or Constitution offers exclusive legislative authority to the federal government concerning a particular issue (FindLaw, “Bank of America v. City and County of San Francisco”) Federal and state law involves major conflicts due to the existence of distinctive principles and decision making measures, especially in the context of preemption (FindLaw, “Bank of America v. City and County of San Francisco”) State law is often observed to create clashes on the decisions made by the federal law regarding issues associated with preemption over any particular area including political, economic, trade and environment among others (FindLaw, “Bank of America v. City and County of San Francisco”) The precedent is up to the Judicial Courts in case of any clash between the federal and state law regarding the decisions in any preemption related issues (FindLaw, “Bank of America v. City and County of San Francisco”) Federal preemption is generally witnessed to occur if the federal law supplants an inconsistent state regulation or legal code (FindLaw, “Bank of America v. City and County of San Francisco”) Federal preemption is a complex terminology, as the litigants involved in this system often require to be familiar with the issues to avoid major negative influences on the litigation outcomes (FindLaw, “Bank of America v. City and County of San Francisco”) The federal law refers as the supreme legal regulation of the land. However, the measures to be declared unconstitutional can have negative influence on the state and lead to conflicts within the federal decisions (FindLaw, “Bank of America v. City and County of San Francisco”) Article IV in the US Constitution, which is often known as the Supremacy Clause or in various cases is also considered as a pre-emption Doctrine, declares that the judges from each independent state are liable to comply with the decisions made by the federal department (FindLaw, “Bank of America v. City and County of San Francisco”) Article IV in the Constitution considers that the existence of federal law significantly invalidates any type of arguments made by the state law causing preemption therewith (FindLaw, “Bank of America v. City and County of San Francisco”) However, in other cases, such as making effective controlling measures on national minimum wage, the federal and state law governs supportive measures without focusing on the federal Supremacy Clause further exhibiting a preemption (FindLaw, “Bank of America v. City and County of San Francisco”) Describing the Impact of Federal and State Preemption on the Banking Laws since the 1990’s The identical ordinance enacted during October 1999 and November 1999 in the cities of Santa Monica and San Francisco has been witnessed to prohibit the banking institutions from charging ATM fees from the non-depositors (FindLaw, “Bank of America v. City and County of San Francisco”) The ordinances are witnessed to be enforced in accordance with private rights emphasizing the action that any type of unlawful ATM fees shall be legally liable for the actual damages, if not less than US$250, along with attorney fees and other legal costs (FindLaw, “Bank of America v. City and County of San Francisco”) A number of financial institutions such as Bank of America, Wells Fargo Bank, the California Bankers Association, and subsequently, California Federal Bank across Santa Monica and San Francisco cities were witnessed to file actions against the ordinance of the cities (FindLaw, “Bank of America v. City and County of San Francisco”) The enactment along with the validity of the ordinance raised a number of litigations made by the financial institutions against the Cities (FindLaw, “Bank of America v. City and County of San Francisco”) In relation to the disputes made by the banks, the allegation of the cities has been observed to emphasize that the ATM fees charged to non-depositors are likely to impose major harm on the consumers, as they are charged almost double amount for using an ATM (FindLaw, “Bank of America v. City and County of San Francisco”) The Cities had also insisted that the fees charged due to the use of an ATM may unduly create problems for the old-age, physically disabled and the poor as they have a negligible knowledge regarding which ATM to use (FindLaw, “Bank of America v. City and County of San Francisco”) Cities however argued that the decisions regarding the elimination of paying additional fees for using an ATM by the customers may also undermine competition within the domestic banking industry (FindLaw, “Bank of America v. City and County of San Francisco”) The Cities further argued that smaller credit unions and the smaller financial institutions might fail to acquire market share than the larger banks because depositors are likely to avoid ATM fees and transfer their accounts to the banks with an extensive channel of ATMs (FindLaw, “Bank of America v. City and County of San Francisco”) The financial institutions had also been witnessed to make strong arguments regarding the allegation made by the cities wherein the Banks rejected the characterization of ATMs by the cities and had claimed that the average lose between $8,000 and $11,000 annually per ATM may impose negative influence on the financial institutions to gain profit and strengthen business sustainability (FindLaw, “Bank of America v. City and County of San Francisco”) Additionally, the Banks had also argued that the Ordinances can lead to severe decline of the competitive position held by the financial market, which can further reduce the ability of the banks to retain their financial positioning (FindLaw, “Bank of America v. City and County of San Francisco”) Nevertheless, the banking institutions had considered the ordinances as a disparate treatment of the ATM operators, which could put the Banks at a competitive disadvantage (FindLaw, “Bank of America v. City and County of San Francisco”) According to the observation made by the district court, Ordinances were preempted by the Home Owners Loan Act (“HOLA”), 12 U.S.C. §§ 1461-1470, and the National Bank Act, 12 U.S.C. § 24 (Seventh) (FindLaw, “Bank of America v. City and County of San Francisco”) The district court rejected arguments made by the cities that the Electronic Fund Transfer Act (“EFTA”), 15 U.S.C. §§ 1693-1693r permits the Cities to regulate ATM fees, as a consumer protection measure (FindLaw, “Bank of America v. City and County of San Francisco”) The district court granted summary judgment in favor of the Banks and enforced a permanent injunction, prohibiting the Cities from enforcing the Ordinances (FindLaw, “Bank of America v. City and County of San Francisco”) Analyzing Decisions made by Bank of America v. City and County of San Francisco Bank of America is one of the foremost financial institutions to counter the ordinance made by the City and County of San Francisco under the Ninth Circuit 2002 (FindLaw, “Bank of America v. City and County of San Francisco”) The U.S. Court of Appeals for the Ninth Circuit held that national banks and federal savings associations are not liable to limit charges on ATM fees that was enacted by San Francisco and Santa Monica cities due to federal preemption (FindLaw, “Bank of America v. City and County of San Francisco”) Bank of America and Wells Fargo Bank, both these national banks, along with California Bankers Association, filed a suit and made strong challenges concerning the validity of the Ordinances wherein California Federal Bank, a federal savings bank, was subsequently added as a plaintiff arguing on the validity of the principles and the Ordinances (FindLaw, “Bank of America v. City and County of San Francisco”) 2. DISCUSSING THE ANTITRUST CASES AGAINST MICROSOFT IN BOTH THE UNITED STATES AND EUROPE AND NOTING DIFFERENCES IN THEIR ALLEGATIONS AND OUTCOMES Microsoft’s cases associated with the issue of antitrust have been observed as examples to few of the high-profile implementations of competition law across the US and Europe (European Committee for Interoperable Systems, “Microsoft - A History of Anticompetitive Behavior and Consumer Harm”) Microsoft has been identified to experience a number of legal allegations across its extensive global market operations as well, wherein during the year 1991, the company was reprimanded by the US Department of Justice due to its violation to a set code of conducts in manufacturing Personal Computers (PCs) (European Committee for Interoperable Systems, “Microsoft - A History of Anticompetitive Behavior and Consumer Harm”) From a critical view concerning the allegation, it can be ascertained that the company was reproached by the government for not incorporating internet browser along with the overall application programs that were to be installed within the PC (European Committee for Interoperable Systems, “Microsoft - A History of Anticompetitive Behavior and Consumer Harm”) It was likewise alleged that an infringement of the governmental regulation had been performed by Microsoft, as it was mandated by the government to install internet browser during the production of PCs (European Committee for Interoperable Systems, “Microsoft - A History of Anticompetitive Behavior and Consumer Harm”) Microsoft was legally sued under the “Section 2 of the Sherman Antitrust Act”, due to its illegal monopoly in the market of Operating Systems (OS), developed for PCs (European Committee for Interoperable Systems, “Microsoft - A History of Anticompetitive Behavior and Consumer Harm”) The claim of anti-competitive contracts with numerous vendors, including Original Equipment Manufacturers (OEMs) and Internet Service Providers (ISPs), had also been identified to breach the regulations as per the “Section 2 of the Sherman Antitrust Act” (European Committee for Interoperable Systems, “Microsoft - A History of Anticompetitive Behavior and Consumer Harm”) The allegations made by the United States Department of Justice and the District of Columbia can be highlighted in this regard as few of the major claims faced by this IT giant in the year 1998 (European Committee for Interoperable Systems, “Microsoft - A History of Anticompetitive Behavior and Consumer Harm”) Microsoft was legally sued under the “Section 2 of the Sherman Antitrust Act” due to its illegal monopoly in the market of Operating Systems (OS), developed for PCs (European Committee for Interoperable Systems, “Microsoft - A History of Anticompetitive Behavior and Consumer Harm”) The claim of anti-competitive contracts with numerous vendors, including Original Equipment Manufacturers (OEMs) and Internet Service Providers (ISPs) had also been identified to breach the regulations mentioned in the “Section 2 of the Sherman Antitrust Act (European Committee for Interoperable Systems, “Microsoft - A History of Anticompetitive Behavior and Consumer Harm”) Studying the allegations brought against Microsoft in the European market, it can be observed that the company had also been recognized to face major hurdles regarding the allegation forwarded by the European Commission (European Committee for Interoperable Systems, “Microsoft - A History of Anticompetitive Behavior and Consumer Harm”) In the year 2007, Microsoft was penalized with an amount of around US$666 million by the European Commission on allegation for marketing the latest Windows® version with deficiencies inhibiting consumer interests (European Committee for Interoperable Systems, “Microsoft - A History of Anticompetitive Behavior and Consumer Harm”) The European Court in this context imposed the said amount for abusing the leading position concerning the denial of supplying interoperability related information with the PC Windows® (European Committee for Interoperable Systems, “Microsoft - A History of Anticompetitive Behavior and Consumer Harm”) Differences of the Allegations and their Outcomes The allegations of anti-competitive behavior of Microsoft can be characterized into various dimensions that can make the company to face major difficulties to cope with the often conflicting legal codes across the US and European markets (European Committee for Interoperable Systems, “Microsoft - A History of Anticompetitive Behavior and Consumer Harm”) The campaign to destroy DR-DOS and anticompetitive per processor license fees can be regarded as few of the major concerns fuelling the legal battle between Microsoft and the judicial codes across both European and the US markets (European Committee for Interoperable Systems, “Microsoft - A History of Anticompetitive Behavior and Consumer Harm”) Retaliation and price discrimination against the core competitor like IBM and collective boycott against Intel had also been observed to lead major legal issues for Microsoft in the respective industries (European Committee for Interoperable Systems, “Microsoft - A History of Anticompetitive Behavior and Consumer Harm”) Correspondingly, the campaigns against the rival server operating system marketers can also be regarded as a major set of practices leading to major allegations against Microsoft in the European and the US markets (European Committee for Interoperable Systems, “Microsoft - A History of Anticompetitive Behavior and Consumer Harm”) The elimination of Netscape, Media Players and Internet Explorers from the core operating system of the Microsoft products have been observed to make severe infringement of the legal policies integrated in the European Commission and United States Department of Justice along with the District of Columbia (European Committee for Interoperable Systems, “Microsoft - A History of Anticompetitive Behavior and Consumer Harm”) Failure to comply with the “Final Judgment of Department of Justice” has also been witnessed to allegedly be breached by Microsoft in order to avoid potential intensification in its competitive scenarios (European Committee for Interoperable Systems, “Microsoft - A History of Anticompetitive Behavior and Consumer Harm”) The contradiction regarding the clear obligation of the Department of Justice’s Final Judgment has however accused Microsoft to invoke its Internet Explorer browser, instead of offering users to select internet browser on their own interests, and thus, being characterized as anti-competitive (European Committee for Interoperable Systems, “Microsoft - A History of Anticompetitive Behavior and Consumer Harm”) In the similar context, the attempt of requiring license of .NET Framework prior to publish any benchmark testing of the application also raised major legal confrontations against Microsoft with the legal compliances (European Committee for Interoperable Systems, “Microsoft - A History of Anticompetitive Behavior and Consumer Harm”) In addition, false promises of interoperability with the consumers and monopolistic business conducts of the company had also breached a number of legal policies across the US and the European markets (European Committee for Interoperable Systems, “Microsoft - A History of Anticompetitive Behavior and Consumer Harm”) 3. DISCUSSING THE ACQUISITION BY GOOGLE OF ADMOB, AND THE CRITICISM OF THE FTC’S APPROVAL OF THE ACQUISITION BY THOSE WHO BELIEVE IT IS IN VIOLATION OF THE ANTI-TRUST LAWS As similar to Microsoft, Google has also been witnessed to involve in confrontations due to its alleged practices of various anticompetitive measures, further leading the company to face major regulatory debacles over the years (Reback, “Technology and Anti-Trust”) The acquisition of AdMob, a mobile advertising start-up by Google may be considered to ignite allegations from the corporate and administrative members of Google (Reback, “Technology and Anti-Trust”; Stone, “Sure, It’s Big. But Is That Bad?”) The acquisition further caused a major antitrust issue for the company to gain continuous success in different fields of the business sector (Reback, “Technology and Anti-Trust”) The procurement of AdMob has been identified to prompt different investigative and monitoring processes regarding each technology based element exploited within the products (Reback, “Technology and Anti-Trust”) For instance, the concept of camera-equipped cars to photograph the neighborhoods across the world using Google Map has been criticized strongly by the people using unsecured WiFi networks (Reback, “Technology and Anti-Trust”; Stone, “Sure, It’s Big. But Is That Bad?”) The concept of building camera-equipped personal vehicles has also been alleged to breach the regulatory norms, as the process to photograph world’s neighborhood using Google Maps shall come into breach with privacy policies (Reback, “Technology and Anti-Trust”; Stone, “Sure, It’s Big. But Is That Bad?”) The concern relating to privacy breach had been identified to inadvertently involve Google towards breaching principles as per the Federal Trade Commission (FTC) regulations across the different European nations (Reback, “Technology and Anti-Trust”; Stone, “Sure, It’s Big. But Is That Bad?”) Apparently, the concern was in conflict with the US policies under supposition that the invention of camera-equipped cars may lead to loopholes allowing Google to breach the existing competitive policies and create major hurdles for the competitors within the US market (Reback, “Technology and Anti-Trust”) The strategy of owning AdMob and developing camera-equipped cars by Google was also on the verge to lead the company to trespass the legal guidelines stated by the competition laws in the US (Reback, “Technology and Anti-Trust”) Additionally, the investigation process of FTC, concerning the anticompetitive regulations related with Google’s business was supported by different other practices that claimed major issues against the company (Stone, “Sure, It’s Big. But Is That Bad?”) The primary claim issued in FTC’s case was concentrated on the vertical integration searching process of Google, which tends to promote its service content, such as shopping comparisons, maps and flight searches results among others (Stone, “Sure, It’s Big. But Is That Bad?”) The vertical integration into the organic search results restrict competitors to access internet users, which further resulted as an anticompetitive pressure on the rivals (Stone, “Sure, It’s Big. But Is That Bad?”) The process of search results in this context has been considered by the FTC policies to involve search bias in contradiction with the US competitive policies, wherein the company was also criticized to hinder ethical standards in the service providing functions (Reback, “Technology and Anti-Trust”) The process of search bias reduced the potential capabilities of the competitors as the results only show the services of the competitors in the second or in other searching pages that are seldom checked by the internet users (Reback, “Technology and Anti-Trust”) The claims made by FTC also reveals that the existence of search bias may lead to foreclosure of majority of websites from different geographical locations, creating a major hurdle for the other organizations to redirect or access wide range of internet users (Stone, “Sure, It’s Big. But Is That Bad?”) The FTC antitrust division was further observed to make continuous monitoring on the business conducts, with an attempt to gauge the neutrality claims made by Google in the global internet platform (Reback, “Technology and Anti-Trust”; Stone, “Sure, It’s Big. But Is That Bad?”) However, there are numbers of examples to identify gaps within the business practices, claiming the neutrality of Google in the respective business industry (Stone, “Sure, It’s Big. But Is That Bad?”) Although it is often observed that Google itself is liable to give logical reasoning to the regulatory and legislative agencies concerning closer inspection of the user accounts, the company has further followed similar mistakes in breach of privacy of internet users (Stone, “Sure, It’s Big. But Is That Bad?”) The closure inspection of individual user account might expose them to major threats affecting their privacy and security, such as in the case of publicly exposing contacts from the Gmail users, without giving any type of warning might have created a major concern regarding the business neutrality of Google (Stone, “Sure, It’s Big. But Is That Bad?”) In this regard, the security and privacy of individual users have become a major question for Google to preserve its neutrality in the web-based business industry (Stone, “Sure, It’s Big. But Is That Bad?”) FTC’s antitrust claims against Google, therefore, provide a major insight, which not only promotes fair business practices, but also ensures protecting individual’s security and privacy (Stone, “Sure, It’s Big. But Is That Bad?”) Works Cited Bank of America v. City and County of San Francisco. FindLaw, 2014. Web. 30 May, 2014 Microsoft - A History of Anticompetitive Behavior and Consumer Harm. European Committee for Interoperable Systems, 2009. Web. 30 May, 2014 Reback, Gary. Technology and Anti-Trust, 2009. Web. 30 May, 2014 Stone, Brad. Sure, It’s Big. But Is That Bad? 2010 Web. 30 May, 2014 The Corporation. YouTube, 2007. Web. 30 May, 2014 Read More