Deep Dive Episode 198 – Eyes to The Sky: Privacy, Property, Innovation, and Commerce in The Age Of The Drone

[Music and narration]

 

Introduction:  Welcome to the Regulatory Transparency Project’s Fourth Branch podcast series. All expressions of opinion are those of the speaker. 

 

Jack Derwin:  Hello and welcome to this Regulatory Transparency Project virtual event. My name is Jack Derwin, and I am Assistant Director of RTP at The Federalist Society. As always, please note that all expressions of opinion are those of the guest speakers joining us today.

 

To learn more about our speakers and their work, you can visit RegProject.org to view their full bios. After opening remarks and discussion between our panelists, we will go to audience Q&A. Please enter any questions into the Q&A function, and we will address them as time allows.

 

Today, we’re pleased to host a conversation titled “Eye to the Sky: Privacy, Property, Innovation, and Commerce in the Age of the Drone.” To discuss this timely topic, we have a great panel featuring Matthew Feeney, who is the director of the Project on Emerging Technologies at the Cato Institute; Brent Skorup, who is a senior research fellow at the Mercatus Center at George Mason University; Gregory Walden, who is a partner at Dentons; and our moderator today, Gregory McNeal, who is a tenured professor of law and public policy at Pepperdine University and the co-founder of AirMap.

 

With that, Greg, I’ll turn it over to you.

 

Prof. Gregory McNeal:  Well, thank you very much. And thanks to everyone who’s joined us this afternoon or who’s listening to the recording after this live presentation. It’s really a pleasure to host this discussion today on what really is a timely topic about drones, privacy, and commerce, especially at this point in time now where drones are really at a tipping point where they’re about to become integrated into our everyday lives.

 

And we’ve heard many talk about that for a long period of time. I myself as an academic have been working in the field related to drones since at least 2012 and then as an entrepreneur through my company since 2015. And for a long time, we have been saying that the era of the drone is right around the corner, but largely government regulations have slowed the ambitions of entrepreneurs.

 

But it does seem that we are now at a point where the regulatory timelines, as they’ve slogged along, have now reached a point where we really are about to see commerce explode, and with that, a lot of clashes with privacy, property rights, and then a lot of benefits from this amazing technology starting to deliver commercial goods, starting to deliver benefits for businesses through efficiencies. And so this is a really timely topic.

 

And the book, published by Cato University Press, brings together multiple authors discussing a variety of different perspectives, from pro-commerce perspectives to libertarian perspectives, property rights perspectives, federalism perspectives. And it’s really a worthwhile read, and I would encourage everyone who’s here on the call to check out the book and grab a copy of it. 

 

With that introduction out of the way, I’d like to begin by having Gregory Walden start off and kick us off with an introduction to the topic. Go ahead, Greg Walden.

 

Gregory Walden:  Thank you, Greg, and welcome to those on the call. We’re not quite ten years from the first action by Congress in providing direction to the Federal Aviation Administration on getting a drone or UAS regulatory framework in place. Drones have been here for decades, and the FAA had fooled around with some informal guidance in the decades before the 2012 reauthorization act.

 

But when Congress actually looked at this and said, “Okay, FAA, you have the following directions on coming out with a rule using test sites. Keep your hands off model aircraft and hobbyists for the most part.” And that spawned a bunch — well, I think it was 5,000 exemptions to allow drone operations before the FAA actually had a rule authorizing commercial operations. That rule came in play in 2016. Congress also put out some other requirements in 2016. And then a third big reauthorization bill dealing with drones was in 2018.

 

So what the drone industry started by getting exemptions to fly, but until there was a rule in place, that exemption process was protracted. For some, it was not even successful, but again, 5,000 exemptions. When the rule came in place, Part 107, it basically obviated exemptions; that is, you could operate under the rule within the visual line of sight under 400 feet above ground level during the day, operating one drone at a time, and there were some other limitations.

 

Well, okay, that rule was good as far as it went, and there are tens of thousands of drone operators and drone users that can operate and even make a profit within that Part 107 framework. But really, for the drone industry to take off—and sorry for the mixed metaphor—with aviation, you really need widespread beyond visual line of sight operations. This is not simply for package delivery, but also for, say, infrastructure inspection or delivery of vaccines and other medical equipment.

 

The FAA did say, “Okay, we have this commercial rule in place but will allow for waivers under the rule. But you can’t get that waiver to go beyond the line of sight if you’re carrying packages, doing anything for compensation or hire. For that, you’ll need some sort of a certificate, an operator’s certificate.” And the FAA’s only granted three of those to date.

 

They did make progress in coming out with two rules on the same day to authorize operations over people, that is, directly over people, and to operate — and to require drones to be equipped with remote identification. That operations final rule with also authorize nighttime operations. Nighttime waivers and exemptions became routine, so it was just a matter of time before the FAA said, “Well, we can authorize that by rule.”

 

Where we are right now is there are many operations within the visual line of sight for inspection, for cinematography, or for photography, weddings and that sort of thing, they’re fine. But again, package delivery, for whatever reason, and some infrastructure inspection, going under bridges, going in tunnels, that requires further rulemaking. And the exemptions that are granted right now in addition to the waivers under Part 107, the exemptions are necessary if you are, again, want to operate with a — for package delivery, for compensation or hire, or if you’re operating a drone over 55 lbs. 

 

What’s next? Well, the FAA has set up an Aviation Rulemaking Committee for beyond visual line of sight operations, so eventually we’re going to get a rule on beyond visual line of sight operations, but in terms of the timeline, it’s unclear. Yes, the recommendations of the ARC need to be submitted to the administrator by the end of this year, very, very ambitious. But that is just the first stage, actually, a preliminary stage before the FAA would publish a proposed rule.

 

The FAA is also, I would say, not moving with dispatch with regard to type and airworthiness certification. There are ten companies that have drones that are in the certification process at least to the point where the FAA has published airworthiness criteria. But none of those ten have a type and airworthiness certificate. And under the law, you can’t operate without your aircraft having an airworthiness certificate unless, of course, you have a waiver or exemption, as I discussed.

 

And then, finally, there is the unmanned traffic management, or UTM, system that is being worked on right now and developed. NASA was in the vanguard, and the FAA came in with a pilot program directed by Congress. And we expect that UTM will be stood up within the next couple of years, maybe not flip a switch and UTM is everywhere, but it will be at many places. UTM, beyond visual line of sight, type and airworthiness certificate, and detect and avoid technology, which I just briefly touched upon right now, these are the big things that need to be resolved. Not going to be in six months, not going to be year, be several years before these things are mature.

 

Prof. Gregory McNeal:  Great. Thanks, Greg, and thanks for the setup. A lot of activity is occurring, and what it sounds like there is that the greatest amount of progress happened between 2012 and 2016, at least on certainty with regard to regulations, and then a lot of other activities and waiting for more concrete regulations since 2016 as we get almost to the ten year anniversary of the FAA Modernization and Reform Act of 2012.

 

I’m going to circle back, Greg, with some questions for you and just a comment for all our participants. We will have a Q&A function that’s enabled in Zoom. You can see on the bottom of your screen there’s a — not in the chat, but over on the right, a Q&A function, and you can tee up your questions in there. And after we get through all of the panelists, we will then have some questions from the moderator, me, to the panelists, and then we’ll go to Q&A from our callers.

 

And so next, I’d like to bring in Brent Skorup for a little bit of a discussion and going into some federalism and property issues. And so go ahead, Brent. Why don’t you kick us off there?

 

Brent Skorup:  Yeah. Thanks, Greg. And I want to thank Matthew Feeney for putting the book together and bringing his experts together, and it was an honor to contribute my chapter.

 

I’ll talk a little bit about my chapter in the book Eyes to the Sky, which is a great resource for anyone working in this area. My chapter is “Who Should Govern the Skies?” And this is an important question. As Greg Walden indicated, things have moved fairly slowly. And I think the framework I have in my chapter helps explain how things could move more quickly and how time consuming and costly for industry it would be if we choose the wrong approach.

 

And so how I set up the chapter, I say there’s two clean categories—and everything in real life is a spectrum—but there are two clean categories for who regulates public assets. You can have federal regulation, or you can have state regulation. And also, two approaches to regulation of public assets. You can have market rationing or administrative rationing. 

 

And you can think of this in four ideal categories. Again, in real life, it’s a spectrum. You can have federal market, and that would be something like radio spectrum which is leased or auctioned for ten year periods. The federal government gets revenue from private companies. You can state market, and that would be something like timber land leasing in state forests. You can also have federal administrative, something like airport slots which are administered by the federal government, the FAA, to private commercial airlines. And state administrative rationing, something like taxi medallions, which are awarded to private companies.

 

And on these latter two, the administrative ones, the airport slots and taxi medallions, these are awarded by regulators, but then there’s an act of secondary market of private companies which indicates that regulators are giving away for free something that has pretty substantial market value.

 

Drones, largely because of inertia, largely because the federal regulators have regulated traditional aviation for decades, drones have fallen into the federal administrative framework, I would say. And this presents — well, there are some possible problems with this inertia. One is just practical realities, the day-to-day of the agency, which has a lot of tasks not related to drones. And relatedly, as Greg Walden, I think, kind of alluded to, drone regulation doesn’t seem to be a major priority for the FAA, this agency that regulates manned flights and commercial airlines.

 

Drones have kind of fallen through the cracks. And one indication of this, Congress instructed the FAA in 2016, five years ago, to identify drone no-fly zones across the nation for sensitive infrastructure, theme parks, and so forth. Congress later gave them a deadline of early 2020 to get this done and identify these drone no-fly zones.

 

So the instructions came from Congress five years ago. They had a deadline in 2020. And they haven’t even started this process, this 2209 process. There’s not even an NPRM out, which, if you’re in the industry, this is really discouraging. You’re spending cash every year, and it’s another year of no revenue. So this is a problem. You can’t have an industry based on regulatory waivers that can be revoked at any time, which has been the process so far.

 

There is progress, but there are also some legal issues as well with this kind of federal administrative category that we find ourselves in. Surface airspace is private property, and by surface airspace, I’m talking about the airspace below 500 feet, which the FAA has not classified as navigable airspace to date. But at some altitude, surface airspace is private property, and this has been held by the Supreme Court in airline cases in the past where it can be a taking if you’re flying frequently through low altitude airspace. 

 

You also have the issue that — a related issue because surface airspace is property, you run into state sovereignty questions. States typically have sovereignty over and determine how property rights are shaped. And Laura Donohue in the book has a great chapter about this topic, so I won’t belabor it, but I will say this is a potential threat and could create complications with this federal administrative program we have for drone policy. 

 

And a proposal I talk about in my book and in other writing is a system of cooperative federalism, given the fact that drones involve not only interstate commerce and safety of traditional aviation but also intrastate commerce and questions of property rights and trespass and nuisance and takings that state will have to deal with.

 

And I also propose a system of an airspace market, much like spectrum auctions or offshore oil leases or timber leases so that regulators are not gifting this valuable public asset to private companies, that there’s a return for the use of this valuable public asset. In particular, the public rights of way or airspace above public property would be a good place to allow drone operators more freedom to operate at low altitudes. And in fact, many states, over 20 states, allow airspace leasing above public roadways that these laws have not been used for drones. I think it’s a pretty good way and a pretty quick way of granting up to millions of miles of airspace to drone operators for them to deploy and deploy commercial services.

 

I’m sure we’ll talk more about some of this, but that’s what my chapter covers. 

 

Prof. Gregory McNeal:  Great. Thank you, Brent. And now we’ll go to our editor, Matthew Feeney, to talk a little bit about privacy, surveillance, and some of the law enforcement aspects related to drones. And so I’m going to hand it off to you now, Matthew.

 

Matthew Feeney:  Great. Thank you. And I want to thank all of you listening live and those of you listening after the recording. But a special thanks, of course, to Greg Walden and Brent for writing two of the seven chapters in this book. I think anyone interested in ongoing drone policy issues, whether it’s privacy, commerce, or federal regulation will get a lot out of it. Brent already alluded to a chapter by Professor Donohue from Georgetown, and if you want to learn about what the Ninth Crusade and what King Edward the First have to do with drone law, this is the book for you.

 

I thought, given that Greg and Brent had spoken about some of the issues about commercial regulation of drones or their applications, I would discuss some of the concerns that are towards the end of the book, and these deal with surveillance and privacy. Many, many people are already familiar with the fact that the federal government certainly uses drones to patrol the northern and southern borders, and state and local law enforcement agencies are increasingly interested in using arial surveillance devices.

 

Those of you who pay attention to news in the surveillance world will know that it’s not uncommon for large federal Predator drones to be used for surveillance, but smaller assets like airplanes with certain cameras that can keep cities under surveillance have been used, perhaps most notably in Baltimore.

 

And this, I think, raises interesting Fourth Amendment issues, but the Supreme Court has yet to take an arial surveillance case associated with drones. There are a number of cases from the 1980s dealing with arial surveillance where the Court held that you do not have a reasonable expectation of privacy to the contents of your private property being observed from an airplane or a helicopter.

 

These kind of issues are what the two authors, Jake Laperruque from the Project on Government Oversight and Jay Stanley from the ACLU, tackle. And I thought it would be worth me just outlining at least some of their concerns and proposals before turning to a case that came out earlier this year from the Fourth Circuit which I think may showcase how courts will deal with these kind of issues in the future. 

 

The first chapter that I want to briefly discuss is Jake Laperruque’s where he outlines six rules that he thinks legislatures should be implementing. I won’t go through all in exhaustive detail, but I do want to mention a couple. One is the mandatory use of probable cause warrants. Although the Supreme Court has held that there isn’t a Fourth Amendment violation for warrantless searches, we’ve seen that at least a dozen states have imposed warrant requirements for drone surveillance, which is something that Jake recommends.

 

There’s also requirements for disclosing certain details about the technology, how it’s used and when it’s used. Also, an exhaustion requirement that this is not a go-to or routine piece of surveillance kit that law enforcement use on an everyday basis. And also, the introduction of some sunset provisions.

 

Something that Jake also discusses that I want to highlight is the importance of definitions here. Part of his chapter discusses that Miami police tried to get around searching prohibitions on using drones by using a blimp with a camera attached to it because under the definition of drone, such a blimp attached to a vehicle did not fit the definition. 

 

Jay Stanley from the ACLU writes a lot about the current use of the federal use of drones for surveillance but goes on to discuss some of the more disturbing uses of technology such as automatic tracking and things such as that. And Jay also does a good job, I think, of emphasizing that we should really think of drones as platforms for a range of surveillance devices, obviously cameras being the most notable, but there are others that can be attached. 

 

And I’ll wrap up before turning to Q&A and maybe taking the conversation further by noting that earlier this year, the Fourth Circuit did hold that Baltimore’s arial surveillance program did violate the Fourth Amendment. What I think is interesting here is that the court did not rely on cases from the 1980s dealing with arial surveillance, which I suppose you might expect, but actually relied on a more recent case, Carpenter, which deals with cell site location information where the Supreme Court did hold that people do have the reasonable expectation of privacy in the whole of your physical movements. And that, I think, is an interesting approach to it.

 

Those of you who are Fourth Amendment nerds or keeping an eye on the state of the surveillance may see more and more courts when they’re thinking about the Fourth Amendment and arial surveillance actually reaching not back to the 1980s to helicopter and airplane cases but dealing with Fourth Amendment cases that are associated with different technologies, namely cell phones. So with that, I’m happy to talk further and to take your questions. 

 

Prof. Gregory McNeal:  Thank you, Matthew. So let me start with my own question. It’s actually going to begin with moderator’s privilege to set it up with a statement. As you all know, I have strong opinions about this, and so I’m going to riff a little bit off of Greg’s setup from the regulatory timelines.

 

If we think back in 2012 when Congress passes the FAA Modernization and Reform Act, the thing everyone was talking about at the time were Predators and Reapers on the battlefield. And I remember, when Congress passed its legislation, the phone calls I got from journalists where battlefield technology is coming to the United States. And I think many people believed that the FAA’s focus on integration was going to be about these large UAS that Matthew just referenced, the types that are presently patrolling the borders of the United States and sometimes are used in the interior of the United States in law enforcement actions. 

 

But the agency’s focus shifted, and my thought is it shifted because the explosion of recreational or what we might call prosumer or light commercial drones. The primary manufacturer of them at the time was a Chinese company called DJI and an American company called 3D Robotics. These were the remote control drones that someone could buy at Best Buy or on Amazon, fly them essentially like a remote control helicopter, and use them for a variety of recreational or commercial purposes. And these exploded, hundreds of thousands if not millions of sales of theses.

 

And the agency, as a safety agency, became very concerned about these and used the legislative mandate under the FAA Modernization and Reform Act to pass its first set of regulations that Greg talked about that were proposed in 2015 and finalized in 2016. And then largely, the agency could say, “Look, we addressed our problem. We’re a safety agency. We addressed a problem. And now anything new, like what industry pumped all its money into for package delivery drones, beyond visual line of sight drones, really, the millions of drones conducting billions of daily flights, well, that’s something new.”

 

And safety agencies don’t like new because as one bureaucrat at the FAA told me, “The safest day in modern aviation history was the day after the worst day in modern aviation history, which was September 11. The safest day was September 12 because all of the aircraft were grounded, so no accident could happen.” That’s what someone at the FAA actually told me.

 

So with that set up, let me start with Brent. Right now, my sense is that a bunch of — 100,000 or less people walking around with their drones flying within line of sight are just a bunch of remote control helicopter operators, and we don’t have a lot of property issues, or Matthew, we don’t really have a lot of privacy issues. Your local police department doesn’t have a lot of Predators and Reapers, and if they have a drone in the trunk of their police car, they can only fly it within line of sight.

 

And so to Brent first, what are we going to face when this beyond visual line of sight thing comes online and drones can operate autonomously beyond visual line of sight from a police station? They can take off and respond to a 911 call. They can patrol streets on their own. What are the issues, Matthew, with that, or Brent, when drones can conduct package delivery operations or land use survey operations at low altitudes at high scale? Brent, on the property stuff first, high scale, and then Matt. Brent, go ahead with that thought, high scale operations, not the kind of stuff we’re dealing with today.

 

Brent Skorup:  Yeah, yeah. The way I try to think of this, of drones, is much like traditional vehicles today where if you’re on your property, you should have a lot of freedom to use vehicles as you see fit. I think of four wheelers and snowmobiles and dirt bikes on your own property. There’s not a huge government interest in what’s going on, within reason.

 

Once you’re on public roadways, so to speak, with drones, once you’re flying at high altitudes not on your own property, there’s pretty substantial government interest in what happens. And I think you see that with some of the drone regulations and the purpose behind remote ID so that police and landowners and others can know who’s flying in case something goes awry.

 

The property and legal issues are pretty substantial once you are doing long distance flights or a mass delivery service of some kind. I have a law journal article in the Akron Law Review coming out about airspace as property, and it’s actually a pretty old idea. You have legal treatises 150 years ago discussing the idea of separating airspace from the land beneath it. And airspace sales have been going on for decades.

 

Surface airspace is property. It’s treated by courts as property. And for that reason, these long distance drone flights, if you’re flying in residential areas, there are, and you are seeing issues of trespass to property to nuisance lawsuits. If it’s authorized by the government, you run into takings issues and all of these — I wrote the law journal article, and I’ve written about stopping it because if lawmakers and the industry don’t proceed with these in mind, it could create a lot of problems. Every landowner — every piece of land you fly over is potentially a trespass or nuisance lawsuit or a takings lawsuit to a local government or  federal government.

 

And so it’s important to get ahead of this, and that’s why, at least in the short term, I see this idea of drone easements above public roadways as a way of avoiding a lot of the tricky trespass, nuisance, and takings issues that — and privacy issues, not to mention privacy issues that you might see. 

 

Prof. Gregory McNeal:  Brent, on a related point, we have a question in the Q&A that’s actually related to this, so I’m going to insert it now. What about drone highways and tollways? If you’re saying people have property and easements, then can they charge for overflights of their property? Like, sure, you can fly over my property, but I’m going to — it’s going to cost $5.

 

Brent Skorup:  That’s why I like using roadways, using existing rights of way. That gives a company — just like UPS today on the ground, by using roadways, you have access to pretty much every residential property without using private property, without driving, of course, across private property. And so you can avoid the potential of people holding out for egregious rates for flying over their property. Use the public roadways and the airspace, the public rights of way, because absent legislation and a revolution in the Supreme Court positions on this topic, you do run into trespass and the payment issue really quickly in residential areas. 

 

But yeah, I think there are other models, again, kind of this drone easement approach much, like spectrum auctions, a ten year lease where private companies have a property interest to it.

 

Prof. Gregory McNeal:  Brent, doesn’t that then run into the problem that — let’s say there’s a distribution facility, to use a D.C. example, in Bethesda, Maryland. And it has to deliver to Columbia, Maryland, to use an example. The advantage of a drone would be that it can fly line of sight, A to B, as the crow flies from A to B. Asking it to follow the roadways, the beltway or roadways, doesn’t that ruin all of the advantages of this technology that make it so wonderful? It essentially becomes just a truck in the sky, and it’s no faster, so why would we bother with this technology at that point?

 

Brent Skorup:  I think a lot of the cost benefits come more from autonomy and having a remote Hopper handling multiple deliveries at once, more than the distance. I’ve looked into the distance question because I’ve been asked about this before and there’s not much on the topic, but if you’re using roadways, it generally adds about 40 percent compared to as the crow files, for what that’s worth.

 

And there is another approach. It gets very costly if you’re hit with trespass, nuisance, and takings lawsuits for every flight as the crow flies. So I’m not sure as the crow flies gets you the cost savings that you might think. 

 

Prof. Gregory McNeal:  Let me ask you one more question, Brent, before I go to Matthew, and then I’m going to bring Greg in as well. I thought I heard in your remarks that you start from the premise that the navigable airspace ends at 500 feet. I’ve been a person who’s sympathetic to the views that you have of property rights and airspace extending from Causby, but I don’t know that the 500 foot line is the correct line. 

 

Helicopters have been able to operate below 500 feet. At least as far as drones are concerned, the FAA has said that drones can operate anywhere, is the FAA’s position, from 0 to 400 feet. And that has turned all of that airspace, wherever a drone can operate, into navigable airspace. The FAA, when it comes to charting, says that obstacles below 200 feet don’t have to be charted, but they have to be charted if they’re above 200 feet. And then, in Causby it says as much of the airspace above your property as you can use in connection with that property. 

 

Who’s really using airspace at 500 or 400 or 300 feet? Isn’t this really like an 83 feet, 85 foot, 100 foot thing, not a 500 foot thing? I mean, 500 feet is insanely high, and that’s the real barrier to this flight from A to B as the crow flies. And so shouldn’t the proposal go lower, and if it doesn’t, don’t you run the risk that the FAA would come along and just extend that navigable airspace line, as a matter of federal rule, much lower?

 

Brent Skorup:  Yeah, yeah. Sorry. I should be precise. Five hundred feet is what’s codified, although the FAA has the side note of, by the way, helicopters taking off and landing and aircraft taking off and landing, that’s also navigable airspace. But they’ve never codified the view that I’ve heard some drone operators make that all outdoor airspace is navigable airspace. They’ve never codified that view.

 

What was the second part of your question?

 

Prof. Gregory McNeal:  Could the FAA change this? If it’s premised upon where the FAA — so the cases have largely been premised upon—and this is true also as I go to Matthew—premised upon the FAA’s assertion of what the airspace is. Where does a person have a right to be? If the FAA changes that line, does that change the property rights and the observational line by dropping that line down?

 

Brent Skorup:  In short, no. What you take from the Causby and the Griggs case—Causby was in 1946, an airplane case, and Griggs in 1962—the short of it is that navigable airspace yields to property rights a low altitudes. In Causby, this was the chicken farm case we all learned about in property class, and military planes flying frequently above a farm is a takings.

 

Griggs was similar except in that case the federal government thought they got clever, and they said, “No, well, now we’re defining it as navigable airspace.” And the Supreme Court in Griggs said, “No, you can’t justify it as navigable airspace without compensation to landowners. They own airspace at low altitudes.”

 

So as I said, absent a revolution in the Supreme Court jurisprudence on this, surface airspace is private property. In fact, the FAA, if you’re an airport, or if you’re trying to expand an airport, you’re required to gain navigation easements, which often means paying landowners for their air rights. So there are some substantial legal problems for the FAA, which is why I think they haven’t done it, to just saying all outdoor space is available to drone operators.

 

Prof. Gregory McNeal:  All right. Thanks, Brent. And Greg Walden, I promise I’m going to come back to you. I’m going to have Brent set this up, as he did, then I’m going to go to Matthew, and then I’m going to come to Greg Walden. And the question to Greg Walden is going to largely be this looks pretty messy for innovation. So I’m setting you up, Greg. I’m going to come to you in a second.

 

Matthew, let me set you up. The question initially that I posed was police officers now with these drones operated within line of sight, that’s not like the Baltimore arial surveillance case with persistent surveillance. And so maybe there’s an argument here that this changes when drones can start to operate beyond line of sight autonomously.

 

But I don’t see how that changes with Ciraolo and Riley, for example. Ciraolo said no reasonable expectation of privacy from aircraft at 1,000 feet. Riley says no reasonable expectation of privacy from, what was it, a helicopter at 365 or 400. So the police park a bunch of drones operating autonomously between 365 and 1,000 under a new set of regulations.

 

How has this changed it? Just the fact that there’s no human operator has fundamentally changed the equation. I  don’t see how that changes the Fourth Amendment analysis. So what’s the central animating concern that you’re getting at in your research? Why should we look at this differently? How have drones changed the privacy calculus for us?

 

Matthew Feeney:  I think they’ve changed the privacy calculus in a few ways. One is that it’s fair to say that many of the frightening stories people share about drone surveillance concentrate on these multi-million dollar Predator drones outfitted with military grade surveillance technologies. And even the Baltimore arial surveillance case was a case in which the surveillance was funded by a billionaire philanthropist using technology that had been previously used in Afghanistan. And there I think the listeners will be familiar with the concerns about keeping an entire city under surveillance are. I think those concerns are pretty well grounded.

 

Nonetheless, though, I think at low altitudes, police drones still have the capacity to see into parts of people’s homes. The backyards immediately come to mind. But we should also remember what Stanley in his chapter emphasized, which is that drones can act as a platform for other surveillance tools. And at low altitudes, I think facial recognition is perhaps the most concerning, but you can also, of course, outfit drones with license plate scanning technology. 

 

But I take the point, I think, that the actual — on Fourth Amendment analysis, there doesn’t seem to be necessarily much of a change between a drone at, say, 400 feet or an airplane at 1,000. Certainly, I think, though, the cost of these things means that we should expect more of them if there isn’t legislative or judicial breaks being applied. The kind of drones that can be pretty intrusive — private citizens can buy drones for only a few thousand dollars that have incredible zoom capabilities. And so, certainly, police could easily engage in pretty significant snooping with a relatively cheap drone.

 

But this is, I think, one of the concerns that motivated Jake in his chapter to emphasize the importance of minimization requirements similar to the kind of requirements you see in wiretapping statutes that those who are the targets of the surveillance are the only ones supplying data that can be used. Obviously, it’s not hard to imagine, even if you had a warrant to surveille someone’s back yard, you would nonetheless collect video footage of other people’s back yards.

 

So I think before we have a really significant change in the Supreme Court, which I don’t think is going to happen anytime soon, I think it is probably something that states or Congress will have to take up when it comes to imposing warrant requirements or these kind of minimization regulations.

 

Prof. Gregory McNeal:  All right. Thanks, Matthew. All right, Greg. I imagine you might be chomping at the bit here to respond a little bit. This sounds like a mess to me. How is an entrepreneur or one of the companies that you represent ever supposed to get off the ground, so to speak, when the FAA creates a bunch of regulations for, frankly, a bunch of people operating remote control toys that they’re using for professional purposes?

 

You’ve got Brent and some pretty sophisticated people who take an approach that says aircraft laws don’t really necessarily fully apply here. It’s really a cooperative federalism approach. You have folks like Matthew and the civil liberties oriented coalition who say when these things come online, we’ve got some serious privacy and Fourth Amendment concerns. And in that environment, you have a risk averse agency like the FAA who says any new technology that comes on, any new aircraft, will pose a problem here. So you have an interagency problem. You have an interagency problem related to the property rights aspect where DOJ is going to have to weigh in, and you have this multitude of federalism problems.

 

And we’ve seen for a while industry, as I might label some of the coalitions that you’ve worked with, hasn’t wanted to yield on a lot of the policy positions because oftentimes when you yield a little bit, you can lose a lot of ground. So how does industry get any traction after almost a decade of these back and forths, largely having the same conversations? What’s the path forward after ten years of a bit of stagnation?

 

Gregory Walden:  I don’t think the path forward is bifurcating airspace, creating a line in the sky, or auctioning airspace. There are causes of action that have existed in common law reflected also in state statutes that provide for a remedy for invasions of privacy and arial trespass and nuisance. And I think we’ll maybe muddle through that for a number of years on the occasional transitory drone passage over someone’s property.

 

Brent’s right, I think, that the major savings for a company that is operating a drone rather than a truck may be in the fact that you don’t need a driver. But from someone who’s asked for the package to be delivered, and they’re told, “No, it’s not going to come in two minutes. It’s going to go the same time it would take for a car,” then, all of a sudden, the interest in using a drone drops down.

 

I don’t know that there is a surface air — surface airspace sounds like an oxymoron. There is private property rights in airspace above private property. I don’t know that that means that someone owns airspace. I think Justice Douglas said, “Okay, yes, you own as much of the airspace as you can use and enjoy from the virtue of your property,” but there’s no city airspace or state airspace.

 

And Causby, the takings case, which again it’s fine where it is. Why was there a recovery? Because the drones were — I’m sorry, the aircraft was operated so low and so frequently as to deprive Causbys of the use and enjoyment of their property, so low and so frequent. It wasn’t just a simple transient passage over property.

 

The pathway forward is, yes, the FAA has to have a rulemaking framework that will be accepted by the public, that the drones up there are safe and reliable, that they’re as safe and reliable as manned aircraft that are operating at 10,000 feet or 20,000 feet. With respect to operations that are at low altitude and of some frequency, there’s going to have to be cooperation and a good neighbor policy from corporate operators of drones and neighborhoods and other areas.

 

Maybe the FAA has not put in a rule that they have — the navigable airspace goes down to the ground. I don’t think they need to say that because it’s right there in the amended Federal Aviation Act, land necessary for takeoff and landing. And as long as drones are aircraft, then that’s navigable airspace.

 

Now, having said that the FAA has jurisdiction down to the ground does not displace state and local police powers. Those two can coexist, but it may take some time to, again, muddle through on what that law is, whether there really is some sort of a line or a confluence of a mix or analysis of factors that would support an arial trespass or invasions of privacy. But again, bifurcating airspace is not something that I think that the industry wants to see. 

 

Prof. Gregory McNeal:  Greg, you were the chief counsel of the FAA. As part of that job, your office had to draft legal opinions, and so you’re no doubt familiar with the body of legal opinions that the office has put out with regard to the authority of states to regulate takeoff and landing for traditional aircraft.

 

And so I’m wondering if a fact pattern came to you like this — let’s say the City of Santa Monica takes a look at its ordinances, and on the 3rd Street Promenade, which is a pedestrian walkway in the City of Santa Monica where the city presently prohibits bicycles and scooters and skateboards and rollerblades.

 

The city decides to pass an ordinance that has two components. The first part of the ordinance says that no one standing upon the land in the City of Santa Monica may — let’s say it has three components. No one standing upon the land in the City of Santa Monica may take off or land an unmanned aircraft from the 3rd Street Promenade, may not operate an unmanned aircraft while standing upon the land within the borders of the City of Santa Monica, and finally, no unmanned aircraft may operate at skateboard altitude, so two inches above the ground, within the City of Santa Monica.

 

How would your office walk through that? Is that a police powers type issue, or is that the FAA’s navigable airspace extends down to the ground, and such a local law would be preempted entirely, or the takeoff and landing parts might not be? And then we’ve got this question about the operator standing upon the land because we have a unique set of factual circumstances here. How would you reason through it? You know I have my own thoughts. I’m curious how someone with your background, and then also given the clients that you work with, how would you work through that fact pattern?

 

Gregory Walden:  I’m not sure that I’m qualified. I can channel the current thinking.

 

Prof. Gregory McNeal:  It’s a tough one, right?

 

Gregory Walden:  Yeah. But you start with takeoff and landing as something that the FAA has recognized even in the context of drones that it is a province of state and local regulation. They will caution — the caution is, though, that if a jurisdiction said no takeoff and landings at all in our jurisdiction, you might have a Dormant Commerce Clause type of argument. That is something the FAA would not cater to because we’ve seen — I’ve seen letters from the FAA that support a local restriction on, say, arial advertising, but if you ever get to the point of making it a categorical prohibition throughout a whole jurisdiction at all times, then you’ve got a problem.

 

I think when you get into regulating of operations, notwithstanding that someone is standing on the pier but the operating above, I don’t think you can say, oh, well, because you’re standing there, then we can regulate operations. Well, at what altitude, and what type of operations? That comes dangerously close to state and local regulation of flight paths, which the FAA, I think, has discouraged, even if they haven’t put out an opinion to that effect.

 

They’re not putting out much in the way of interpretations right now on these issues. We might see something in the next year or so that was a project at the end of the Trump administration to get something in terms of guidance, more guidance out, but that has stalled. And with the new administration, it’s going to take some time for the new folks. We need a new general counsel and a new chief counsel at DOT and FAA respectively to look at this issue and then decide what type of guidance is appropriate.

 

Prof. Gregory McNeal:  Thanks, Greg.

 

Brent Skorup:  Greg, if I may.

 

Prof. Gregory McNeal:  Go ahead, Brent.

 

Brent Skorup:  This is Brent. Yeah, it’s not entirely hypothetical. There was a very similar case in federal district court for a few years. I mentioned that the FAA is supposed to create these drone no-fly zones above sensitive infrastructure but hasn’t.

 

States have been. I think 13 states have been creating drone no-fly zones above utility lines and jails and schools and so forth. And some drone operators sued Texas because of their law on this topic. And last year in November, drone operators, they argued many things, including that there was conflict in field preemption, that states cannot create general no-fly zones above sensitive infrastructure. And the federal district court dismissed those arguments with prejudice, those preemption arguments. So to me, that’s a signal that there is, at least in this court in Texas, this district court, federal court in Texas, there is a state role to play here.

 

And so it’s not entirely hypothetical, and states are acting on this. They are creating drone no-fly zones, which implies a power over operations, or at least exclude operations. I think I should say that the Texas law, I think, has First Amendment issues for other reasons. It could fail. But on the preemption issues, the court dismissed with prejudice.

 

Gregory Walden:  Well, that’s one district court, and there will be more. I will say that I think on the question of skateboard height, that is probably something that the FAA would not object to. Again, if it were that — if it was a “you can’t operate below 10 feet anywhere in the City of Santa Monica,” different story, different story. But in your hypothetical, Greg, it’s something I think the FAA would probably not object to.

 

Prof. Gregory McNeal:  I think you’re right, Greg. And the interesting cases for the listeners would be on the one end of the spectrum, I think, Brent, you’re referring to National Press Photographers Association v. McCraw in Texas. Then the other end of the spectrum would be Singer v. City of Newton, the other district court case where a city regulation or ordinance was found to be preempted. And that ordinance was very broad, 0 to 400 feet prohibiting — it was essentially the entire city was a no-fly zone. So these are two ends of the spectrum, small, delineated no-fly zones versus the entirety of the city.

 

One of the interesting collateral questions that comes up here too is that if the conclusion is that the city can’t create one of these ordinances, and this is germane to Greg’s point, the lack of guidance, what then does a police officer on the beat do because most state and local police officers have a mandate only to enforce local laws. In fact, some state constitutions, like Connecticut, don’t allow local law enforcement officers to enforce federal law. We saw this in the immigration context.

 

So if you’re a police officer walking up on the beat and there’s a drone hovering at windshield altitude or something over a roadway or at eyeball altitude over a sidewalk, you have to sort of scramble to figure out what’s my authority here. Maybe reckless endangerment in a jurisdiction that has reckless endangerment, although only about 14 states have a reckless endangerment statute. Maybe a careless operation of aircraft under a state statute if the officer knows that that statute exists, or ordinance exists. And so it presents difficulties of the officers. 

 

And you’ll hear police officers say, “What am I supposed to do to act to enforce here?”, which also sort of circles back to Matt’s point, which is that the law enforcement associations are in these interesting positions where they, when these bills come up, they want special authorities to go after people who are operating drones, while at the same time, they frequently want unlimited authority to operate the drones on their own.

 

We have a question from the audience here, and I think I’m going to bring this one to Matthew, which is somewhat related to your point, which is, is there anything to prevent an uninvited drone, perhaps a spy drone, from hovering over my property? What’s the penalty if a property owner dispatches the uninvited drone? This might be a little related to Brent’s work as well. Is there any legislation to cover this situation? And so related to this, further on this question, the facts that this questioner is raising are that the client dispatched the drone, and local prosecutors are now threatening criminal action. And so privacy implications, private actors, and then maybe tying it to —

 

Gregory Walden:  — Greg, if I may interject just briefly, if dispatch means disable or destroy, it’s under federal law.

 

Prof. Gregory McNeal:  Yeah, I’m thinking shooting down an aircraft, Greg.

 

Gregory Walden:  You’ve got a federal law. It’s felony.

 

Matthew Feeney:  Right. I was going to mention that local prosecutors might be the least of your worries if you actually shot at it. Yeah.

 

So the question is, is there anything to prevent an uninvited drone to spy on you. Well, federally, there is no warrant requirement for federal use of drones for that purpose. As I mentioned before, there are some states that do have warrant requirements, and they provide some protection there.

 

If you’re talking about a non-law enforcement, if you just have a nosy neighbor or someone else, then I think there are potential avenues that you can take. Actually, Greg Walden in his chapter of the book does discuss that there are nuisance privacy claims that you can make.

 

As far as legislation, I’m not familiar with any legislation dealing with the actual dispatching of a drone with firearm, but I think the federal law on that’s pretty clear, and probably ill advised. But what we’re seeing, though, is that at least when it comes to state and local, which is of course the law enforcement agencies affecting most people, is that it’s going to be up to the states to figure out if there’s going to be a warrant requirement for that kind of behavior or not.

 

Prof. Gregory McNeal:  Right. We’re nearing the end of the hour, and so this is our last question, and it’s an interesting one. The question is, is it possible for states to establish drone incubator programs that comply for blanket operational waivers from the FAA? In this way, states could streamline the waiver process for applicants to their programs instead of the FAA having to specifically review every applicant.

 

And so let me expand on the question a little bit. We saw in the early days of the legislation—Greg will remember this—or legislative proposals, sort of drone test beds. We saw the drone integration pilot program. Then my former AirMap colleague who now works for an air taxi company has written about the idea of sandboxes, regulatory sandboxes.

 

And then others have written about using, for example, at The Heritage Foundation, have written about using federalism, permissive approaches to federalism. So rather than having the states regulate drones, have the states be laboratories of democracy, like you see in the autonomous vehicles space. Let the drones go out and operate just like the vehicles operate on the roadway so we can have some learnings about operations to accelerate drone adoption.

 

And so is it possible to establish this, and I guess I would riff on this, why hasn’t it happened? Greg Walden, is it possible? Why hasn’t it happened? Is this federalism approach a good idea or a bad idea? So this would be an innovation oriented federalism approach. What do you think, Greg Walden?

 

Gregory Walden:  Well, I like the idea. And we pushed for — the Small UAV Coalition pushed for an idea in a 2018 bill on testing remote ID technologies and giving blanket waivers at certain places as determined by the FAA in cooperation with state and local governments, blanket waiver authority for those test beds. So we would support that authority.

 

But I think there’s probably something that needs to be done. I think that legislation probably is sufficient. It was in the context of the UTM. It did grant, actually, blanket waiver authority. You might need some more statutory authority. 

 

Prof. Gregory McNeal:  All right. And then, Matthew, what about this idea? What about blanket operational waivers from the FAA? Let’s take drones to Maryland and let them operate autonomously beyond visual line of sight over the City of Baltimore and see what happens.

 

I understand the downside might be there’s a privacy implication, but wouldn’t the upside be that we would accelerate a series of cases and fact patterns that might prompt legislative responses? We would go from the hypothetical dystopian boogeyman to is this real, and maybe prompt a response. So isn’t possibly accelerating this, even though it might trigger short-term privacy implications, perhaps a good thing because it’ll get us to reform more quickly? Or is it once we let the camel’s nose under the tent, we’ve forever enabled the panopticon? What’s your sense, Matthew?

 

Matthew Feeney:  I certainly, obviously, have concerns about privacy, but I’m inclined towards the former, that the more we can experiment with this new and emerging technology in a variety of jurisdictions, I think the quicker that we’ll learn the lessons we need to to ensure that we have a vibrant entrepreneurial space where people feel like they can use drones for commerce and hobbies while also ensuring that we protect privacy.

 

I think privacy is a difficult question, but it’s not impossible to answer. And I think seeing how many jurisdictions can treat these issues in a variety of ways is one way to do that. But of course, under the current regulatory regime, I think that’s going to be a little difficult. 

 

Prof. Gregory McNeal:  Great. Thanks, Matthew. And then, Brent, what are your thoughts on this federalism-based approach?

 

Brent Skorup:  In short, I think it is possible to establish a drone incubator program or a drone sandbox. The FAA — there are many within the FAA who want to see this industry succeed, and I think if a state had a well-crafted plan for this that they would be on board. They have this BEYOND program working with states and cities and tribal governments. I don’t know if that’s closed, but frankly, the FAA’s agreements are pretty ad hoc. I think if there’s a compelling example, they would favor that.

 

I’ll leave you with one last example that I think is useful. The FAA recently gave BNSF, the railroad company, I believe it’s a national waiver to have drones below 500 feet using the rail company’s property, above their property, including the railways. And so I think if you combine these ideas, this waiver which can be revoked at any time for BNSF, they can operate drones below 100 feet above their property and railways nationwide.

 

With this idea of states getting involved, I think you come close to the approach that I’ve urged, which is working with a state and its subdivisions and allowing these kind of linear operations using state rights of way and federal rights of way, which is throughout the nation.

 

Prof. Gregory McNeal:  Great. Thanks, Brent. And so as we begin to bring the program to a close, let me do this. So we’ve exhausted all of our questions, but if people listening on the podcast would like to get in touch with any of our panelists, let’s share our personal or organizational Twitter accounts. And so if you want to reach out to me or shout at me, you can reach me on Twitter @GregoryMcNeal. And then we’ll just go in the order in which everyone presented. Greg Walden, what’s the best way to reach you or your organization on Twitter?

 

Greg Walden:  Well, there’s Twitter addresses, but I’d just prefer [email protected]. 

 

Prof. Gregory McNeal:  Great, thanks. And then, Brent?

 

Brent Skorup:  Yeah, I’m Brent Skorup at the Mercatus Center, and you can find me on Twitter @bskorup. Thank you. 

 

Prof. Gregory McNeal:  Wonderful. And then, Matthew?

 

Matthew Feeney:  I am on Twitter @M_feeney. You can visit cato.org to read more of my work and pick up a copy of Eyes to the Sky, which is also available on Amazon.

 

Prof. Gregory McNeal:  Fantastic. As we wrap up here, I want to thank everyone for turning out for the podcast. And please take a look at the other podcasts for the Regulatory Transparency Project and also follow the Regulatory Transparency Project on Twitter. Thanks, everyone, for attending the program, and thank you for the questions.

 

Gregory Walden:  Thanks, Greg, for moderating.

 

Jack Derwin:  Thanks so much, Greg, and to all our panelists. And also, thank you to our audience for tuning in. You can check out our website at RegProject.org and follow us on all major social media platforms @FedSocRTP to stay up to date. With that, we are adjourned.  

 

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Conclusion:  On behalf of The Federalist Society’s Regulatory Transparency Project, thanks for tuning in to the Fourth Branch podcast. To catch every new episode when it’s released, you can subscribe on Apple Podcasts, Google Play, and Spreaker. For the latest from RTP, please visit our website at RegProject.org.

 

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This has been a FedSoc audio production.

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