August 05, 2008

The movie "Le Diable Boiteux" (1) has us witness two vignettes at the French court. In the first, Louis XVIII complains to the eponymous hero, Talleyrand, about the frequent inquiries made on his health by the heir to the throne, the future Charles X. Immediately after, we see Charles X receiving the same sollicitude from his more popular cousin, soon to become King of the French at the favor of the July revolution (2).

In his report about the concerns raised by Steve Jobs' health (*), Joe Nocera reminded me of Sacha Guitry's little gem of irony. Nothing is more private than one's own health. Yet nothing seems to excite the interest of others more than the prospect of one's imminent demise. I hope Steve Jobs can rely on the comfort of knowing the concern of some is genuine. What matters to most is the economic impact of the underlying medical facts.

For privacy is not just some nice luxury we ought to do without. Privacy is about real money. In Apple's case there is much to gain for someone with inside access to Steve Jobs' health records and a knack for circulating rumors. There are laws to protect confidential health information (3) and punish insider's trading while the SEC is bent on enacting new regulations to curb rumors. But overall the legal picture on data rights is far from clear.

Were our Western society to recognize a general right to privacy, it remains to be seen whether the law would extend its protection to everyone equally or in proportion to one's social status. This is but an instance of the lasting tension between the Weregild custom (4) of Northern European tribes in the High Middle Ages and the modern ideal of democratic equality. Recent events provide us with some clues.

Take Max Mosley's legal triumph related by John F. Burns (**). The hero of this made by tabloids story would fit right in among XVIIIth century upper classes, or at least the sad segment so well represented by certain French marquis. A party animal he invited to his home later leaked vivid videos of a private nature. Promptly relaying such edifying news, the News of the World slapped them with a trumped up Nazi label and lost the libel case Mosley brought up for the slight. The plaintiff won a $1M payment for damages and legal costs.

Contrast this with the fate of Joshua Lipton as told by Eric Tucker (***). While under a drunken driving charge, this lowly lout went to "a Halloween party dressed as a prisoner". Someone snapped his picture and posted it on Facebook. Alerted to the fact by the prosecutor, the sentencing judge was not amused and gave Lipton two years of the real thing.

Admittedly, the two cases differ in many ways. Max Mosley had broken no laws. Joshua Lipton had. The News of the World and its spy intended from the start to profit from the invasion of Max Mosley's "reasonable expectation of privacy". Facebook did not orchestrate the reporting of Joshua Lipton's private lack of judgment. As for the anonymous photographer, revenge was probably not on his mind, contrary to the ground breaking case covered by Megan Murphy (****). Yet, when all is said, isn't one left with the impression that privacy exists only to benefit the privileged few?

Turn from the legal blotter to the business section. There privacy is valued more for enhancing negotiating power than reputation. As Amazon launches its own payment system, Brad Stone (*****) pointedly reports some retailers fear Amazon could use this service to capture their "sales data to compete more effectively with them". This is a very real risk as long as data aggregators are not made liable to data contributors. Besides their own benevolence, what prevents online software services to benefit from the confidential data they process on behalf of small business owners?

Ron Lieber's exposé of how shopping for student loans lowers one's personal credit (******) is another clear measure of the value of privacy in economic transactions. Loan terms are highly dependent on both the borrower's personal profile and the lender's competitive practices. Fairness should enable both parties to seek mutual agreements in total confidentiality. In the real world the would-be borrower must reveal his or her full profile to the lender while the lender keeps its score system secret. To make a long story short, each such asymmetric inquiry penalizes the unfortunate borrower. Some want to prevent credit to be lowered on that basis. I would rather have confidentiality enforced during shopping.

Obviously borrowers do not have the same economic status as lenders. But before enshrining the expediency of Weregild inspired practices into privacy law, one should meditate this quote attributed to Talleyrand (5). "We have learnt, a little late no doubt, that for states as for individuals real wealth consists not in acquiring or invading the domains of others, but in developing one's own".

Those who claim to do no evil while harvesting our private data could learn a lesson or two from the devil with a limp.

Philippe Coueignoux

• (*) ............. Apple's Culture Of Secrecy, by Joe Nocera (New-York Times) - July 26, 2008
• (**) ........... British Judge Rules Tabloid Report Tying Grand Prix Boss to 'Orgy' Violates Privacy, by John F. Burns (New-York Times) - July 25, 2008
• (***) ......... Web photos may bite back at defendants, by Eric Tucker (Boston Globe) - July 20, 2008
• (****) ....... Facebook case opens new front for libel awards, by Megan Murphy (Financial Times) - July 25, 2008
• (*****) .... Amazon Offers Other Sites Use of Its Payment Service, by Brad Stone (New-York Times) - July 30, 2008
• (******) .. How Shopping Around Can Cost You, by Ron Lieber (Financial Times) - July 26, 2008
• (1) for more information, see Le Diable Boiteux in the French wikipedia
• (2) to my British readers, political figures from XIXth century France may seem remote. By luck, current local news provide them with another cast.
• (3) for more information, see Handling of medical records in my lecture series
• (4) for more information, see weregild in the wikipedia
• (5) see Talleyrand in the wikipedia