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Legal Report February 2006


NEGLIGENCE. In a California appellate case, the court has ruled that a business owner was on notice to increase security when he became aware of gang activity on his property. Because of the violent nature of gang life, the owner did not first need to experience prior similar incidents on his property to predict that a shooting would take place.

On November 9, 1996, Ernest Castaneda returned to his house—a mobile home he shared with his grandmother and sister—around 2:00 a.m. A few minutes later, a car carrying four people pulled up in front of Castaneda’s home. Two men emerged from the mobile home opposite Castaneda’s—number 23—and began shouting at the four people in the car. The two groups—members of rival gangs—exchanged gunfire.

Castaneda stepped onto his front porch and was struck by a stray bullet. Castaneda was rushed to the hospital, underwent surgery, and eventually recovered from his injuries. He then sued the owner of the mobile home park, George Olsher, for negligence in allowing the known gang members to live in the  park and menace other home owners.

Olsher hired Beverly Rogers to manage the park. She suspected that gang members had moved into space number 23 and reported her suspicions to Olsher. In response, Olsher said that if the owners paid their rent on time, he would not evict them. Olsher also refused to hire security officers and responded similarly to reports of drug dealing and theft by the residents of number 23.

At trial, resident Monica Lankford testified that she circulated a petition asking Olsher to repair broken lights, clean up graffiti, and initiate a curfew. However, other residents refused to sign the petition, according to Lankford, saying that they were afraid and did not want to cause any problems.

Lankford’s car windows were smashed shortly after she began circulating the petition. Lankford reported the incident to Olsher. He said that nothing could be done and urged Lankford to move if she had problems with park residents.

The jury ruled in favor of Olsher. It found that Castaneda had failed to establish that Olsher had a duty to take action and implement additional security measures or that Olsher’s inaction had caused Castaneda’s injuries. Castaneda appealed.

The appeals court found in favor of Castaneda, ruling that there was sufficient evidence to prove that a great deal of crime occurred on the property and that gang activity was prevalent. The court also ruled that, in cases that involve gang violence, property owners may be held to a higher standard because criminal activities are inherent to the gang lifestyle.

In the written decision of the case, the court noted that, “Where, as here, the property owner knows that gang members are congregating on his property and that gang activity and gang-related crimes are occurring there, a gang-related shooting is much more foreseeable than is a random violent criminal act. For this reason, courts may more readily impose on a landlord a duty to protect tenants from gang violence.”

According to the court, this means that when the landlord becomes aware of gang members and gang activity on his property, it is reasonable to expect increased security measures on that property. (Castaneda v. Olsher, California Court of Appeal, No. D043383, 2005)


DATA RETENTION. The European Union has approved a new directive that would require telecommunications companies in member states to retain data generated by electronic communications—though the content of the communications may not be collected—to aid law enforcement in combating serious crimes. This means that member states must retain e-mail addresses and location data from cell phones, for example.

The directive is controversial because it gives member states great discretion in implementing the directive. For example, states can determine what types of serious crime to investigate under the directive and the definition of those crimes. Also, the length of time a company must maintain such records is six to 24 months according to the directive, but member states may extend the retention beyond 24 months.

To be implemented, the directive must be approved by all member states. The directive is likely to encounter opposition in some countries by those who believe that it violates personal privacy.


RADIOACTIVE MATERIAL. The Nuclear Regulatory Commission (NRC) has received public comments on its proposed rule to track radioactive material within the United States.

The system set out in the proposed rule would require those licensed to use this radioactive material to report the manufacture, transfer, receipt, or disposal of that material. To start the program, each licensee would be required to provide the government with its inventory of radioactive material and to assign a unique serial number to each item.

The NRC received 33 comments to its proposed rule. The commission is now reviewing the comments and preparing a revised rule. While most of those who provided comments praised the intent of the program, many commentators suggested improvements. Some respondents urged the NRC to drop the tracking of some low-radiation sources from the program and to exempt reporting duties for those working on temporary job sites. In addition, some respondents expressed concern about the security of the tracking database.

In the proposed rule, the NRC includes tracking of "category three" sources. These are items—used predominately in medical facilities and oil drilling equipment—that contain little radioactive material and could not be used as a weapon. The NRC expressed concern, however, that terrorists might combine several category-three sources to obtain enough radiation to be harmful.

Several commenters argued that sufficient tracking of such sources is already required by the NRC. "We already keep excellent inventory records… so inclusion of these sources in the national tracking system is an additional reporting requirement," wrote Cheryl Schultz, corporate radiation safety officer for William Beaumont Hospital.

Another issue is the tracking of radioactive sources on temporary job sites. Those commenting on this aspect of the program contend that tracking is sufficient for these items—logs are already required by the NRC and are open to inspection at any time. Respondents further argued that any such reporting at the remote job site would be ineffective.

Gary Balestracci of the Nondestructive Testing Management Association explained the issue in his comment. "Radiographers may be required to conduct operations at more than one location during any given day," he writes. "If the data must be input by the close of business each day, then the information received will be an indication of where the sources may have been, rather than an indication of where the source actually is."

One commenter, who did not give a name, asked what computer security measures the NRC planned to implement to protect the tracking database. "I believe that having a central database, which could be hacked by a computer expert would provide a terrorist with a listing of all the large sources in the United States… a national database actually reduces national safety."


IDENTITY THEFT. A bill (S. 1789) introduced by Sen. Arlen Specter (R-PA) and designed to thwart identity theft has been approved by the Senate Judiciary Committee. The Senate has agreed to consider the measure.

S. 1789 would enhance penalties for those who use computers to commit identity theft crimes and provide law enforcement officials with more money to investigate and prosecute identity theft. The bill would also require that any business that involves collecting, accessing, transmitting, using, storing, or disposing of sensitive personal information on more than 10,000 people develop a personal data privacy and security program.

These programs would have to address the administrative, technical, and physical security of information. Companies would also be required to conduct a risk assessment and develop a risk management program. The Federal Trade Commission would have oversight authority to ensure that companies were in compliance with these requirements.

INSURANCE. A bill (S. 467) extending the Terrorism Risk Insurance Act of 2002 (TRIA) for two more years has been signed into law by President Bush.

The new law extends the TRIA, which otherwise would have expired at the end of 2005. The law also establishes a commission charged with developing a transitional system to take its place. Without the TRIA, a government program that keeps insurance for terrorist attacks affordable, proponents of the bill argued that terrorism insurance would become unaffordable for most businesses.

BORDER SECURITY. The House Judiciary Committee has approved a bill (H.R. 4437) that is designed to strengthen border security. The House of Representatives has agreed to consider the measure.

H.R. 4437 would eliminate the policy of “catch and release” currently carried out on the border between the United States and Mexico. The practice, which arose because of a shortage of border agents—involved apprehending those attempting to cross the border, giving them a warning, and telling them to attend a court hearing. Under H.R. 4437, the government would build detention centers and would be required to hold apprehended aliens until their court dates.

Another measure in the bill would allow the United States to easily detain and deport aliens who are part of street gangs. The bill would also prohibit aliens who are terrorists or security risks from becoming U.S. citizens.

AVIATION SECURITY. A bill (H.R. 4439) introduced by Rep. Dan Lungren (RCA) would overhaul the Transportation Security Administration (TSA) to increase aviation security.

The bill would require that TSA reorganize to focus resources on areas at greatest risk of terrorist attack and would mandate that the TSA create a program to instantaneously prescreen all international passengers traveling to the United States.

The bill would also allow state and local governments to compete with federal contractors to provide airport security. Under the bill, the TSA would be required to create new training standards to allow those who check documents to recognize fraudulent identification.

Under the measure, the government would create an independent agency within the TSA to focus on screening.


Rhode Island

IDENTITY THEFT. A new law (formerly H.B. 6191) in Rhode Island will require that any business that owns or licenses computerized, unencrypted information on customers implement and maintain reasonable security measures to protect information.

This column should not be construed as legal or legislative advice.