Law struggling with changes in material reality: corporate confidentiality this time

I have emphasized again and again the difficulties law faces when there are profound changes in the material reality of our lives, including, for example, demand for new sources of energy. Law is not a set of rules good for all time in all places and all things. It is, rather, an evolving system that tries to do justice in the particular situations it addresses.

The new technologies for copying and disseminating information have of course thrown our legal system into confusion over copyright. Those technologies also are having a profound impact over notions of confidentiality and privacy. Wikileaks is of course in the news in connection with its disclosures of U.S. military secrets, including its release of an Apache helicopter attack in Iraq.

The efforts of a British court to deal with Wikileaks illustrate the difficulties courts often have in applying legal rules that grow out of an era already long past to the new world. Wikileaks’ released of documents from Barclays Bank detailing Barclays’ efforts to use offshore affiliates to evade taxes in Great Britain. A judge ordered the Guardian newspaper, which had published the documents, to take the material down because, he reasoned, the bank had a right to confidentiality.” He also ordered the Guardian not to publish links or other directions for finding the documents on the internet even though they were widely available on sites not based in Great Britain.

As Alan Rusbridger, the editor of the Guardian, explains, the disconnect between the court’s view of confidentiality and the realities of the internet expose a certain degree of absurdity:

The Internet is throwing sharp relief to the illogical nature of our system. Technology is way ahead of the law, and the law is limping along trying to make sense of it.

Professor James Edelman of Oxford believes the court order in connection with the Barclays documents might be the last example of this particular type of confusion, particularly because Barclays may realize that its legal efforts, even if “successful” in getting an order barring publication in the U.K., only serve to publicize the existence of the documents the bank is trying to keep hidden:

“What is significant about the ruling,” he said, “is that it will open people’s eyes that even if you can get an injunction to preserve information that is able to be obtained over the Internet, I suspect that the injunction won’t last.” The publicity over the injunction creates more interest in the material, leading other sites to publish it. The Guardian will be able to return to court, he said, and argue the injunction no longer serves any purpose.

Mr. Rusbridger said that the newspaper still had not decided whether to do that. The cost for being wrong, he said, could be as much $300,000 in legal fees.

Seeming to prove Professor Edelman’s larger point, however, when Wikileaks became overloaded by the traffic about a week ago, another site, techcrunch.org, published the seven memos under the heading “How Barclays Ensured That Everyone Would See Their Confidential Tax Documents.”