Tech Law Journal Daily E-Mail Alert
Dec. 28, 2000, 8:00 AM ET, Alert No. 90.
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New Documents
NSC: International Crime Threat Assessment, undated (HTML, NSC).
Milberg: Complaint against pcOrder alleging violation of federal securities laws, 12/26 (PDF, Milberg).
Milberg: Complaint against CapRock Communications alleging violation of federal securities laws, 12/20 (PDF, Milberg).
Quote of the Day
"Transactions involving technology or components for weapons of mass destruction or embargoed items under US or international sanctions are being done through computers. Virtually any commodity, including weapons of mass destruction and their component parts and delivery systems, is being offered for international sale on Internet sites. US Customs investigations show that many Internet sellers of contraband materials openly advertise that they have been in operation for many years without being caught by law enforcement."

National Security Council, and other members of a U.S. interagency group, from a report titled International Crime Threat Assessment.
News Briefs
12/27. Bill Clinton made a "recess appointment" of an Article III judge. Clinton released a statement that he "appointed Roger Gregory to serve on the United States Court of Appeals for the Fourth Circuit." The Fourth Circuit includes Maryland, North Carolina, South Carolina, Virginia, and West Virginia. The Eastern District of Virginia, which includes the northern Virginia suburbs of Washington DC, is home AOL and many other new economy companies, and has an active technology law docket. This "recess appointment", like Clinton's appointment of Susan Ness to the FCC on Dec. 18, was made in the brief window between the adjournment of the 106th Congress in mid December, and the convening of the 107th Congress in early January. Clinton had sought, but failed to obtain, Senate confirmation of both Ness and Gregory.
12/27. DSL provider Digital Broadband filed a petition for Chapter 11 bankruptcy in U.S. Bankruptcy Court. It also stated that "At the close of business on January 12, we will turn down our network, and Digital Broadband will no longer be providing your voice, data or Internet services."
12/26. A U.S. interagency group released a report dated December 2000 titled International Crime Threat Assessment that addresses both criminal violations of intellectual property rights and use of technology to commit and conceal crimes. The report concluded that "As worldwide dependence on technology increases, high-tech crime is becoming an increasingly attractive source of revenue for organized crime groups, as well as an attractive option for them to make commercial and financial transactions that support their criminal activities. With little of the risks and penalties associated with more traditional criminal activity, high-tech crime allows criminals to operate in the relative security of computer networks, often beyond the reach of law enforcement where the crime was committed." See, extended excerpts on technology related subjects.
12/22. Bill Clinton granted a pardon to former Rep. Dan Rostenkowski (D-IL). He lost his bid for re-election in Nov. 1994. He was convicted of two counts of mail fraud in violation of 18 U.S.C. 1341 and 1346 in 1996. See, DOJ release. He had been Chairman of the House Ways and Means Committee. The outgoing Chairman, Rep. Bill Archer (R-TX), retired at the end of the 106th Congress. Two senior members of the Committee are currently seeking the Chairmanship, Rep. Phil Crane (R-IL) and Rep. Bill Thomas (R-CA). Rep. Crane, who is currently the Chairman of the Trade Subcommittee, represents a suburban Chicago district. Rep. Thomas, who is currently the Chairman of the Health Subcommittee, represents the 21st District, which lies between Los Angeles and Fresno, and includes much of Kern and Tulare Counties. In recent years the Committee has addressed many issues that affect technology, including foreign trade, PNTR status for China, foreign sales corporations, trade related aspects of intellectual property, taxation of phone users to fund e-rate subsidies, capital gains from venture capital partnerships, Internet taxation, depreciation of computer equipment, and the excise tax on telephones.
12/21. Bill Clinton made a recess appointment of James Dorskind to be General Counsel at the Commerce Dept. He previously worked for the law firm of Friedman Ross & Hersh, and for the 1992 Clinton/Gore election campaign. See, White House release.
Editor's Note: This column includes all News Briefs added to Tech Law Journal since the last Daily E-Mail Alert. The date indicates when the event occurred, not the date of posting to Tech Law Journal.
Securities Litigation
12/26. An individual named Jean Burke filed a complaint [PDF] in U.S. District Court (WDTex) against pcOrder.com, several of its officers and directors, its controlling shareholder, Trilogy Software, and several underwriters, alleging violations of federal securities laws. The plaintiff, who seeks class action status, is represented by several law firms, including Milberg Weiss. Count one alleges violation of 11 of the Securities Act, 15 U.S.C. 77k, by pcOrder, Trilogy, and the individual defendants. Count two alleges violation of 11 by the underwriter defendants. Count three alleges violation of 15 of the Securities Act, 15 U.S.C. 77o, by all defendants. The suit pertains to the content of two pcOrder registration statements filed with the SEC. Milberg Weiss is a law firm that specializes in bringing securities class action suits against technology companies.
12/21. The U.S. District Court (EDVa) dismissed 14 of 15 lawsuits filed against PSINet and several of its officers that alleged violation of federal securities laws, and sought class action status. The Court granted in part, and denied in part, PSINet's motion to dismiss one remaining action, which was brought by the law firm of Berger & Montague. The Court dismissed claims brought under 10b of the Securities Exchange Act of 1934, and Rule 10b5 thereunder (securities fraud). However, the Court denied the motion to dismiss as to claims brought under 11, 12(a)(2) and 15 of the Securities Act of 1933 (regarding statements in registration statement and prospectus). See, PSINet release and Berger & Montague release. PSINet provides corporate Internet access, private IP networks, Internet security, web and database hosting services, e-commerce solutions, and voice, fax, live audio-video, and other applications.
12/20. An individual named Herbert Becker filed a complaint [PDF] in U.S. District Court (NDTex) against CapRock Communications, several of its officers and directors, and several underwriters, alleging violations of federal securities laws. The plaintiff, who seeks class action status, is represented by several law firms, including Milberg Weiss. Count one alleges violation of 11 of the Securities Act, 15 U.S.C. 77k, by CapRock and the individual defendants. Count two alleges violation of 11 by the underwriter defendants. Count three alleges violation of 12(a)(2) of the Securities Act by CapRock and the underwriter defendants. Count four alleges violation of 15 of the Securities Act, 15 U.S.C. 77o, by the individual defendants. The suit pertains to the content of a registration statement and prospectus filed with the SEC in connection with an IPO. CapRock is building an extensive fiber optic network in the Southwestern U.S. Milberg Weiss is a law firm that specializes in bringing securities class action suits against technology companies.
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