- Blog Post
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Technological innovation often exposes existing law as inadequate to manage changes such innovation creates. In its recent term, the Supreme Court reinterpreted constitutional law in two cases driven by the impact of digital technologies. In South Dakota v. Wayfair, Inc., the court overruled its previous jurisprudence in deciding that state governments can tax internet commerce. In Carpenter v. United States, the court held that law enforcement collection of cell-site location information for an extended period was a search under the Fourth Amendment and required a warrant. In both cases, the court adjusted constitutional law because digital technologies disrupted relationships between the governed and the government.
Wayfair addressed the question whether the Commerce Clause prohibited South Dakota from taxing sales internet retailers located outside South Dakota made in that state. Supreme Court rulings before the era of electronic commerce held that states could not tax sales made by companies with no physical presence in the taxing jurisdiction. In a 5-4 decision, the court struck down the physical-presence rule. Although the majority argued that the rule was variously flawed, the growth of e-commerce and the “continuous and pervasive virtual presence of retailers today” clearly exposed these flaws. The court emphasized how the “Internet revolution” and “the Internet’s prevalence and power have changed the dynamics of the national economy,” meaning it could not “maintain a rule that ignores these substantial virtual connections to the State.”
The issue in Carpenter was whether the Fourth Amendment applied to the FBI’s acquisition of 127 days of cell-site location information for a robbery suspect. Referencing prior Supreme Court cases, the government argued that the Fourth Amendment did not apply because the suspect had no reasonable expectation of privacy in information shared with a third party. In another 5-4 decision, the court held that the Fourth Amendment applied. The court stressed the narrowness of its decision and that it was not over-ruling the third-party doctrine. But it rejected “mechanically applying” the doctrine to information about a person’s location generated automatically by cellphones, devices which have become indispensable in modern society.
Although they address different issues, the cases raise similar questions about how law should change in light of technological disruption. In both decisions, the majority believed a constitutional ruling was needed to re-align the law. The proliferation of digital technologies and services has long created concerns that this phenomenon unduly benefits certain private-sector actors and increases government surveillance power. In Wayfair, the Supreme Court eliminated an “unfair and unjust” advantage internet companies enjoyed at the expense of brick-and-mortar retailers and state treasuries. In Carpenter, it expanded the Fourth Amendment’s scope, increasing the government’s burden in law enforcement investigations.
These decisions reflect perceptions that the severity of technological disruption required the Supreme Court to re-interpret constitutional law, rather than insisting that Congress was the appropriate venue for legal change. The majority in Wayfair noted the scale of tax revenues states lost to internet retailers under the physical-presence rule and declared that the court should not “ask Congress to address a false constitutional premise” the court itself created. For the majority in Carpenter, aspects of what cellphone technologies reveal about a person’s movements fall under the Fourth Amendment, not the law Congress adopted to regulate government access to communication records held by third parties.
The minority opinions downplayed the impact of technological developments and stressed that legal change should come from Congress. In his Wayfair dissent, Chief Justice Roberts asserted that any damage internet commerce inflicted on state tax revenues has receded and that Congress should handle whatever problems remain. In Carpenter, Justice Kennedy’s dissenting opinion questioned whether cell-site location information differed from credit card and financial records, which remain outside the Fourth Amendment under the third-party doctrine. Kennedy chastised the majority for running “roughshod over the mechanism Congress put in place to govern the acquisition of cell-site records and closes off further legislative debate on these issues.”
The votes in both cases reveal interesting features about the divide on the court between conservative and liberal justices. The Wayfair majority consisted of Kennedy, Thomas, Ginsburg, Alito, and Gorsuch, with Roberts, Breyer, Kagan, and Sotomayor dissenting. In Carpenter, Roberts, Ginsburg, Breyer, Sotomayor, and Kagan formed the majority, with Kennedy, Thomas, Alito, and Gorsuch in dissent. Ginsburg was the only justice in the majority in both cases. Roberts voted only with liberal justices, perhaps supporting the idea that he might become the court’s “swing vote” after Kennedy’s retirement.
What a Roberts swing vote might mean for future cases addressing technology and the law is not clear given his dissent in Wayfair and majority opinion in Carpenter. Perhaps a common thread is the chief justice’s preference for Congress to adapt law to technological developments, most apparent in his Wayfair dissent, but the narrowness of Carpenter leaves many unanswered questions ripe for legislative action. But, given congressional behavior in the face of technological challenges, Wayfair and Carpenter might ultimately suggest that expecting Congress to keep law in pace with technology is wishful thinking.