Privacy Matters: Data Breach Litigation in Japan

In 1890, when Brandeis and Warren wrote The Right to Privacy, Japan did not have a word for privacy. Today, it is closely guarded in Japan: the European Data Protection Board has found privacy protections in Japan “equivalent” to those in the EU. This research explores the evolution of privacy law in Japan, focusing on data breach and the legal rights and obligations associated with it. The writing is broken up into two parts: This article discusses private enforcement of privacy norms, as it is the courts that first established and continue to define privacy rights in Japan. A separate article will address the public law regulation of privacy, including discussion of Japan’s Act on the Protection of Personal Information and its regulatory enforcement. Examining the civil litigation that has defined privacy norms in Japan, one finds three distinct periods: early judicial decisions that create privacy rights by weaving together pre-existing legal doctrines in new ways; a period of expansion where courts recognize a legal injury for disclosure of even basic personal information; and a recent Supreme Court decision that expressly recognizes a remedy for the mental distress that arises from a data breach, even without proof of financial harm. In comparison to the public law cases, one also finds a public law-private law divide. While some Japanese courts in data breach litigation suggest individuals possess a “right to control” their own personal information; in cases involving the central government, one finds no more than a right to the “reasonable handling” of that information. A cross-jurisdiction comparison suggests Japan seeks middle ground. Japanese courts define privacy rights more broadly than in the U.S., but not to the extent found in jurisdictions governed by the GDPR. In doing so, Japanese courts use tort law to balance interests: to compensate plaintiffs; to incentivize defendants’ compliance with industry standards and government regulations; and to reward defendants who implement post-incident remedial measures. The result is a set of legal norms that clearly recognize privacy rights, but also limit damages. These legal norms, in turn, have produced stable market norms that now allow parties to settle most data breach claims. Privacy is no longer a foreign concept in Japan

Japan and the Moneylenders—Activist Courts and Substantive Justice

Problems with sub-prime loans roiled financial markets worldwide in 2007 and brought renewed attention to predatory lending practices by loan brokers in the United States. Questionable lending practices, however, plague consumer financial markets worldwide, including one of the largest, found in Japan. This Article addresses the Japanese response to systemic problems in its consumer finance market. Over the last forty years, the judiciary has led and the Diet followed. Most recently, in 2006, the Supreme Court handed down a series of decisions that turned the single most important earnings driver for the consumer finance industry into dead letter law. The Diet followed with legislative revisions. Both actions have imposed restrictions unheard of in the United States and drastically reshaped the financial industry in Japan. This Article analyzes these recent changes and places them in context. Doing so offers more than description and a point of comparison. It provides a window into the evolution of Japanese private law. It provides evidence that challenges the conventional wisdom on Japan. The Japanese judiciary is neither weak nor ineffectual. It is not limited to following the dictates of the Liberal Democratic Party or bureaucracy or filling in legislative lacuna. It has not limited itself to activism in the service of stability or community. In private law matters, it has come to act aggressively: repeatedly invalidating black letter law and providing substantive as opposed to procedural justice. This work shows the Japanese judiciary has not evolved into a monolithic bureaucracy, but one often driven by activist lower courts. The historical context and discussion of recent developments in consumer finance law offers insight into legal changes affecting the Japanese financial markets today, as well as the evolution of the role of law and the rule of law in Japan

Layers of the Law: A Look at the Role of Law in Japan Today

In 1967, Professor Kawashima wrote about a world of vaguely defined rights and norms in Japan. This article argues that world still exists. But it now co-exists with a world that commonly defines rights, in great detail, and regularly invokes them. There are layers of the law in Japan. Primary ordering of relationships and services is often based on complex, legalistic contracts and regulation; secondary ordering is often based on equity, Japanese notions of equity. Examples from contract, employment, and environmental law and practice illustrate this. For each, this paper examines both sides of the coin—transactional ordering and litigated outcomes. Leases may be so detailed that they address liability for a broken toilet paper holder. Yet, if challenged in court, leases may be re-written to reflect current economic circumstances or the “consensus of society.” Employment contracts may start with indemnification requirements and end with termination rights, but if they are litigated, the courts will look for just cause. Volumes of regulation govern when a nuclear reactor may operate, but the final decision is based on a “gentlemen’s agreement” and local consensus. As a result, negotiation occurs first in the shadow of detailed rights and obligations, and, if contested, then in the shadow of law, equity, and local consensus. The role of law in Japan has changed enormously since 1967, and will change in the decades to come, but an accurate description of what it is now starts with Professor Kawashima’s discussion of vaguely-defined rights and an understanding of the layers of the law described in this paper

The Shifting Sands of Cost Shifting

The cost-shifting analysis employed by the federal courts in ruling on discovery disputes is flawed. There is tremendous variability in how courts interpret the factors guiding the analysis. There is tremendous variability in the information courts rely on in deciding whether to preclude the discovery or shift its costs. The result is waste for the litigants, courts, and society as a whole. This Article argues that there is a better way: mandate cooperation before cost shifting. The courts should condition proportionality and cost-shifting rulings on cooperation. The cooperation should be substantive: require disclosure of objective information about the disputed discovery and, if costs are shared, share control over the process. Cooperation will not come about by exhortation or proclamation; it will come if the cost of discovery, or the discovery itself, hangs in the balance. With that comes the possibility of reducing costs. Asking “is the discovery unduly burdensome” results in a different answer than asking “can it be done more efficiently”? This Article argues that the courts should ask the latter question first and require cooperation in answering it. Federal Rule of Civil Procedure 1, with its mandate to construe the rules to seek the “just, speedy, and inexpensive determination of every action,” demands it

Modeling Spatially and Temporally Complex Range Dynamics When Detection is Imperfect

Species distributions are determined by the interaction of multiple biotic and abiotic factors, which produces complex spatial and temporal patterns of occurrence. As habitats and climate change due to anthropogenic activities, there is a need to develop species distribution models that can quantify these complex range dynamics. In this paper, we develop a dynamic occupancy model that uses a spatial generalized additive model to estimate non-linear spatial variation in occupancy not accounted for by environmental covariates. The model is flexible and can accommodate data from a range of sampling designs that provide information about both occupancy and detection probability. Output from the model can be used to create distribution maps and to estimate indices of temporal range dynamics. We demonstrate the utility of this approach by modeling long-term range dynamics of 10 eastern North American birds using data from the North American Breeding Bird Survey. We anticipate this framework will be particularly useful for modeling species’ distributions over large spatial scales and for quantifying range dynamics over long temporal scales

Migratory Behavior and Winter Geography Drive Differential Range Shifts of Eastern Birds in Response to Recent Climate Change

Over the past half century, migratory birds in North America have shown divergent population trends relative to resident species, with the former declining rapidly and the latter increasing. The role that climate change has played in these observed trends is not well understood, despite significant warming over this period. We used 43 y of monitoring data to fit dynamic species distribution models and quantify the rate of latitudinal range shifts in 32 species of birds native to eastern North America. Since the early 1970s, species that remain in North America throughout the year, including both resident and migratory species, appear to have responded to climate change through both colonization of suitable area at the northern leading edge of their breeding distributions and adaption in place at the southern trailing edges. Neotropical migrants, in contrast, have shown the opposite pattern: contraction at their southern trailing edges and no measurable shifts in their northern leading edges. As a result, the latitudinal distributions of temperate-wintering species have increased while the latitudinal distributions of neotropical migrants have decreased. These results raise important questions about the mechanisms that determine range boundaries of neotropical migrants and suggest that these species may be particularly vulnerable to future climate change. Our results highlight the potential importance of climate change during the nonbreeding season in constraining the response of migratory species to temperature changes at both the trailing and leading edges of their breeding distributions. Future research on the interactions between breeding and nonbreeding climate change is urgently needed

The Formation and Transformation of Securities Law in Japan: From the Bubble to the Big Bang

It has been a tumultuous decade for Japanese securities markets. The collapse of the Bubble and advent of the Big Bang have reshaped the markets and spurred significant foreign investment. The newspapers are filled with accounts of mergers, acquisitions, and bankruptcies. Less widely reported, but equally important, has been the dramatic shift in Japanese securities law. Prior to the 1990s, private enforcement of Japanese securities law was "virtually non-existent." The collapse of the Bubble, a regulatory vacuum and unsatisfactory alternative dispute resolution changed this. There has been a litigation explosion resulting in new judicial norms. A proactive judiciary has imposed duties on securities companies and created private causes of action for investors without basis or counterpart in the Japanese Securities Exchange Law. These judicial norms, more than administrative or private norms, have come to regulate the retail securities markets.As with previous periods of judicial activism, the central government has stepped in with new legislation. However, in contrast to earlier retrenchments that removed disputes from the purview of the judiciary, the Diet has codified the new private causes of action and reinforced the role of the judiciary.The changes in Japanese securities law are illustrative of a remarkable shift in Japanese law and present an opportunity to better understand the changing roles of administrative agencies and the judiciary in Japan. These changes also present opportunities, as well as hidden pitfalls, for foreign financial institutions operating in Japan. This paper explores an important area and period of Japanese law that has thus far received little attention