Hillicon Valley: Lawmakers press China over trade secrets | Google to fight $57M EU fine | How the record fine is shaking the tech industry | Dems launch probe into White House security clearances

Welcome to Hillicon Valley, The Hill’s newsletter detailing all you need to know about the tech and cyber news from Capitol Hill to Silicon Valley. If you don’t already, be sure to sign up for our newsletter with this LINK.

Welcome! Follow the cyber team, Olivia Beavers (@olivia_beavers) and Jacqueline Thomsen (@jacq_thomsen), and the tech team, Harper Neidig (@hneidig).

 

ALL EYES ON CHINA: Washington is ratcheting up pressure on China over the country’s alleged theft of trade secrets, even as the dispute quickly escalates.

Lawmakers in recent weeks have introduced several bipartisan bills aimed at Chinese telecom firms believed to have government ties, and federal prosecutors are reportedly preparing an indictment against one Chinese company over stealing trade secrets from American businesses.

{mosads}The stakes for both countries and for U.S. allies are growing. After Canadian officials arrested a Chinese executive last year at the request of American authorities, China retaliated by detaining several Canadian citizens and sentencing one to the death penalty.

But lawmakers insist the U.S. needs to follow through and hold China accountable for alleged intellectual property theft. And they want the administration to do more to address the national security threat from Chinese companies.

“[Chinese President] Xi Jinping’s a bully, and you have to stand up to bullies,” Rep. Mike Conaway (R-Texas) told The Hill. “And there may at times be pushback but that doesn’t mean you don’t stand up to it, because if you don’t stand up to it they just continue to be a bully, even worse.”

“As China gets stronger, as their economy gets bigger, as the military forces get more advanced and stronger, that bully’s getting bigger,” Conaway added. “And now’s the time to stand up to them.” Read more on how Congress is getting tough on China.

 

BIG BUCKS, BIGGER STAKES: A record fine for Google in Europe is raising the stakes for U.S. tech companies and regulators over how they address privacy practices.

Google was hit with a $57 million fine, the largest yet leveled under a sweeping new European data law, the General Data Protection Regulation (GDPR). The fine is meager compared to Google’s bottom line, but the law allows regulators to ramp up penalties up to 4 percent of their annual global revenue. For Google’s parent company Alphabet, that could amount to a $4 billion hit.

For Google and its Silicon Valley peers, the fine is being seen as a wake-up call that Europe is ready to challenge them on their data practices. And in the U.S., it’s raising pressure on American regulators to follow suit and toughen their oversight of tech giants.

Privacy advocates who believe that Big Tech hasn’t done enough to comply with the new law hailed the fine because regulators ruled that some of Google’s foundational data collection and advertising practices are illegal. They see the fine as a clear sign of tougher actions ahead from Europe’s data authorities.

“We are very pleased that for the first time a European data protection authority is using the possibilities of GDPR to punish clear violations of the law,” said Max Schrems, a privacy activist with the group None of Your Business, which filed the complaint that led to the fine. Read more here.

 

NOT SO FAST: Google will appeal a $57 million fine from French regulators for violating the European Union’s sweeping new privacy law, the internet search giant said on Wednesday.

The French privacy watchdog known as CNIL said that Google violated the EU’s General Data Protection Regulation (GDPR) by not adequately informing users about its data collection practices or offering valid consent options. Google said it disagreed with the assessment.

“We’ve worked hard to create a GDPR consent process for personalised ads that is as transparent and straightforward as possible, based on regulatory guidance and user experience testing,” a spokesperson said in a statement. “We’re also concerned about the impact of this ruling on publishers, original content creators and tech companies in Europe and beyond.” Read more here.

 

WE GOT A LIVE ONE: House Democrats are launching an expansive investigation into the White House security clearance process, accusing the Trump administration of disregarding established protocols in a way that has resulted in “grave breaches of national security.”

House Oversight and Reform Committee Chairman Elijah Cummings (D-Md.) sent a letter to White House counsel Pat Cipollone on Wednesday demanding a slew of documents, including those related to background investigations and security clearances of current and former officials like national security adviser John Bolton and Jared Kushner, a senior White House adviser who’s also President Trump’s son-in-law.

Cummings requested that officials from the White House personnel security office who handle security clearance adjudications make themselves available for sit-down, transcribed interviews with his committee starting Feb. 11.

“The goals of this investigation are to determine why the White House and Transition Team appear to have disregarded established procedures for safeguarding classified information, evaluate the extent to which the nation’s most highly guarded secrets were provided to officials who should not have had access to them, and develop reforms to remedy the flaws in current White House systems and practices,” Cummings wrote in the letter.

“The investigation also will seek to determine why the White House is currently defying federal law by failing to provide to Congress information about its security clearance process required by the SECRET Act.” Read more here.

 

GOOGLING ‘MONEY IN POLITICS’: Google spent a whopping $21 million on lobbying Congress and other federal officials in 2018, a record for the company as it tried to stave off the increased scrutiny Silicon Valley has been feeling over its privacy practices and content policies.

Lobbying disclosure filings released on Wednesday show that the internet search giant spent $4.9 million in the last three months of the year, during which its CEO, Sundar Pichai, testified before Congress for the first time.

The $21 million sum for the year tops the $18 million Google spent in 2017 — making it the top spender on lobbying of any company for that year.

Google led other top tech companies in their lobby spending in 2018, a year in which Facebook and Twitter also saw their CEOs testify for the first time. Facebook spent $12.6 million, Twitter spent $1.1 million, Amazon spent $14.2 million and Apple spent $6.6 million. Read more here.

 

ASSANGE IS NOT COMING TO AMERICA: WikiLeaks founder Julian Assange launched a legal challenge against the Trump administration on Wednesday in an effort to require U.S. prosecutors to “unseal” any secret charges against him.

Assange’s lawyers filed an urgent application to the Washington-based Inter-American Commission of Human Rights (IACHR) in an attempt to head off a possible extradition to the U.S., according to The Guardian.

The IACHR did not immediately respond to a request for comment from The Hill.

The Australian-born activist has been hiding out at the Ecuadorean Embassy in London since 2012 to avoid extradition to Sweden over a rape investigation.

Though Swedish prosecutors have since dropped their request for extradition, a U.S. court filing revealed in November suggests that U.S. prosecutors have already pressed sealed charges against Assange. Read more here.

 

KIDS AND THEIR DRONES THESE DAYS: Flight arrivals were briefly suspended Tuesday evening at Newark Airport after two reports of drone activity at a nearby airport, according to media reports.

The Federal Aviation Administration received reports around 5 p.m. from two flights that spotted a drone flying over Teterboro Airport, another airport in New Jersey, according to The Associated Press.

“Be advised there’s something on final here we don’t, we thought maybe it was a drone, uh, but there’s, uh, definitely, uh, something on final here,” a Southwest flight arriving from Phoenix reported, according to ABC7 in New York. Read more here.

 

ON THE HILL: Rep. Jim Langevin (D-R.I.), co-founder and co-chair of the Congressional Cybersecurity Caucus, will chair the House Armed Services Committee’s Subcommittee on Intelligence and Emerging Threats and Capabilities (IETC), per a press release from his office. 

{mossecondads}The Rhode Island lawmaker previously served as the subcommittee’s ranking member the past eight years when Democrats were in the minority.

 

AN OP-ED TO CHEW ON: The age of deepfake: When seeing is no longer necessarily believing.

 

A LIGHTER CLICK: Mark Zuckerberg, with the stun gun, in front of Jack Dorsey.

 

NOTABLE LINKS FROM AROUND THE WEB:

Twitter CEO Jack Dorsey: The Rolling Stone Interview. (Rolling Stone)

Home is where the photo booth is: How Instagram is changing our living spaces. (The Ringer)

Phishing scheme targets professors’ desire to please their deans — all for $500 in gift cards. (Chronicle of Higher Education)

DHS issues warning about DNS hijacking. (CyberScoop)

How Elon Musk’s secretive foundation hands out his billions. (The Guardian)