Tech Law Journal Daily E-Mail Alert
Jan. 9, 2001, 8:00 AM ET, Alert No. 97.
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107th Congress
1/8. The House Republican Conference released a list of committee assignments [PDF] for Republican members for the 107th Congress. Several new members have been appointed to the Commerce Committee and the Judiciary Committee, which have jurisdiction over most of the technology related legislation in the House. The new members of the Commerce Committee are Tom Davis (VA), Steve Buyer (IN), George Radanovich (CA), Joseph Pitts (PA), Mary Bono (CA), Greg Walden (OR), and Lee Terry (NE). The new members of the Judiciary Committee are John Hostettler (IN), Mark Green (WI), Ric Keller (FL), Darrell Issa (CA), Melissa Hart (PA), and Jeff Flake (AZ). Subcommittee assignments have not yet been made; nor have subcommittee chairman been selected. However, Howard Coble (NC) will continue as Chairman of the Courts and Intellectual Property Subcommittee. This CIP Subcommittee will receive many new members, since Mary Bono departed to take a seat on the Commerce Committee, James Rogan (CA) lost his re-election bid, and Ted Pease (IN) retired.
First Amendment
1/8. The Supreme Court of the U.S. denied certiorari in Urofsky v. Gilmore, No. 00-466. See, Jan. 8 Order List at page 7. Six professors employed by public colleges and universities in Virginia filed suit in U.S. District Court (EDVA) challenging the constitutionality of Virginia Code § 2.1-804 to -806, which restricted state employees from accessing sexually explicit material on computers that are owned or leased by the state. District Court Judge Leonnie Brinkema found the statute unconstitutional, and ordered a large award of attorneys fees. The U.S. Court of Appeals (4thCir) issued its opinion reversing the trial court, and upholding the statute, on Feb. 10, 1999. This case is the only significant loss of the ACLU and other groups which have otherwise successfully challenged the constitutionality of several restrictions on Internet use on First Amendment grounds. See also, TLJ story of Feb. 12, 1999.
New Documents
USCA: Opinion in Konop v. Hawaiian Airlines re application of Wiretap Act to web sites, 1/8 (PDF, USCA).
HRC: list of committee assignments, 1/8 (PDF, HRC).
USDC: Temporary Restraining Order in NetZero v. Juno, 1/5 (HTML, TLJ).
DOJ: Manual titled Prosecuting Intellectual Property Crime, 1/5 (HTML, DOJ).
New and Updated Sections
Calendar (updated).
News from Around the Web (updated).
Quote of the Day
"Today, more than ever, investors figure out when they are being treated unfairly, and whether the system is rigged in another's interest. And they soon punish those who abuse their trust. All of us charged with the health and care of America's markets – market participants, regulators, legislators – must fear the possibility of investors ever feeling disillusioned, disgusted, or betrayed. And that should serve as our greatest threat and most compelling motivator."

Arthur Levitt, Chairman of the SEC, from Jan. 8 speech at Stanford.
News Briefs
1/8. The U.S. Court of Appeals (9thCir) released its opinion [PDF] in Konop v. Hawaiian Airlines, a addressing whether viewing a secure web site under false pretenses constitutes a violation of the Wiretap Act and the Stored Communications Act. Konop, a pilot for Hawaiian Airlines (HA), maintained a web site that contained statements that were critical of both his employer and the pilots' union. The web site was password protected, and required registration and consent not to disclose the contents of the web site. An HA VP named Davis accessed the web site on numerous occasions under false pretenses: logging in as pilots who had registered. Konop argued that HA intercepted an electronic communication in violation of the Wiretap Act, as amended by the Electronic Communications Privacy Act, and accessed an electronic communications facility in violation of the Stored Communications Act. The trial court dismissed Konop's claims on summary judgment. The Appeals Court reversed on the grounds that there were triable issues of fact. The Appeals Court held that "The contents of secure websites are 'electronic communications' in intermediate storage that are protected from unauthorized interception under the Wiretap Act. Konop has raised material issues of fact whether Davis had appropriate consent to view Konop's website." It further held that "the Wiretap Act protects electronic communications from interception when stored to the same extent as when in transit." [Appeal No. 99-55106. Appeal from U.S.D.C. No. CV-96-04898-SJL(JGx). Opinion by Boochever. Reinhardt and Paez participated.]
1/5. The U.S. District Court (CDCal) issued a Temporary Restraining Order (TRO) against Juno in NetZero v. Juno, a patent infringement case. NetZero filed its Complaint on Dec. 26, 2000 alleging that Juno's floating advertising window called the Juno Guide infringed U.S. Patent No. 6,157,946. The Court court concluded that NetZero had demonstrated a likelihood of success on the merits. The TRO takes effect on Friday, Jan. 12, and remains in effect for 65 days. A preliminary injunction hearing is set for March 15. Trial is set for July. NetZero, an ISP and web marketer, is represented by William Robinson, of the law firm of Mayer Brown & Platt. [Case No. 00-13378 SVW (RNBx).] Mark Goldston, NetZero Chairman and CEO stated in a release that "We believe our patent is a powerful proprietary right which will provide us with a competitive advantage in our market. We believe the court’s order is further validation of our position. Other ISPs should take note of the court’s ruling and carefully consider their use of similar ad banner windows.
1/8. The FCC released a summary of its 7th annual report to the Congress on competition in markets for the delivery of video programming, and the convergence of video programming and Internet access. The FCC found that cable TV "still is the dominant technology for the delivery of video programming to consumers, although its market share continues to decline. As of June 2000, 80 percent of all subscribers to multichannel video program distributor (MVPD) services received their programming from a franchised cable operator, compared to 82 percent a year earlier." The report also finds that Direct Broadcast Satellite (DBS) subscribers now represent 15.4 percent of all MVPD subscribers. The report also addressed the convergence of MVPD and Internet access. "Cable operators continue to expand the broadband infrastructure that permits them to offer high-speed Internet access. ... Like cable, the DBS industry is developing ways to bring advanced services to their customers. For example, DirecTV currently offers a satellite-delivered high-speed Internet access service with a telephone return path called DirecPC. ... In addition, digital technology makes it possible for MMDS operators, who provide video service in only limited areas, to offer two-way services, such as high-speed Internet service and telephony." Sprint and MCI WorldCom are developing these services. See, FCC release and summary.
1/8. The USITC announced that it is looking for an attorney advisor to work on § 337 matters. The notice states that "The primary duties of this position are to provide legal support to the Commission in investigations concerning patents (especially patents involving electrical technology), copyrights, trademarks, and other intellectual property rights under section 337 of the Tariff Act of 1930 (19 U.S.C. sec. 1337) and to defend the Commission’s decisions in such investigations before the U.S. Court of Appeals for the Federal Circuit." See, notice [PDF].
1/5. The U.S. Department of Justice released a manual titled Prosecuting Intellectual Property Crime. IP industry representatives have criticized the Clinton Justice Dept. for lax prosecution of IP crimes. The manual is lengthy, and thoroughly references relevant statutory sections and cases. The manual also states that "Enforcement of intellectual property laws in America can sometimes be at tension with the constraints of the First Amendment. This strain has long been recognized both in copyright and trademark law. ... New technologies such as the Internet provide fertile ground for revisiting these conflicts." However, it cites only law review commentary, and no case law, in support of these statements. See, DOJ 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.
1/8. Roy Neel, President and CEO of the U.S. States Telecom Association (USTA) announced that he will leave this position effective March 31, 2001. No replacement has been named. Gary Lytle is the interim President and CEO. Neel was previously Bill Clinton's Deputy Chief of Staff and VP Al Gore's Gore's Chief of Staff. He also previously was a Senate aide to Al Gore.
1/8. Rep. Billy Tauzin (R-LA), the new Chairman of the House Commerce Committee, named David Marventano as Staff Director for the Committee. Marventano previously ran Rep. Tauzin's personnel office. Before that he was VP and Senior Director of Government Affairs for the Securities Industry Association (SIA). He was also Chief of Staff and Legislative Director to former Rep. Bill Paxon (R-NY).
SEC Actions
1/4. The SEC instituted and settled an administrative proceeding against Transcrypt International, a Delaware corporation based in Nebraska that makes information security products which prevent unauthorized access to sensitive voice communications, i.e., scramblers and encryptors. The SEC found improper recognition of revenue in 1996 and 1997 in violation of § 17(a) of the Securities Act and §§ 10(b), 13(a) and 13(b)(2) of the Exchange Act and Rules 10b-5, 12b-20, 13a-1, 13a-11, 13a-13,and 13b2-1 thereunder. No fine was imposed. See, SEC Order Instituting Public Proceedings, Making Findings, and Imposing Cease and Desist Order and Transcrypt release.
1/4. The SEC instituted and concluded two separate but similar administrative proceedings against two individuals named Stephen Marek and Dominic Roelandt. Marek controlled two free Internet newsletters, BigProfitNews and Bulls-Eye Stocks. Roelandt controlled a free Internet newsletter called Coldstocks. Both falsely touted microcap stocks, and misrepresented their trading intentions, their track record, and their touting compensation. The Orders bar Marek and Roelandt from participating in any offering of a penny stock. See, SEC Marek Order and SEC Roelandt Order.
10:00 AM. Oral argument before the U.S. Court of Appeals (FedCir) in Sunrise Telecom v. Electrodata, Appeal No. 00-1017. This is an appeal from a final judgment of the U.S. District Court (NDCal) in a patent infringement case. The trial court found infringement of a patent concerning hand held telecom line testers. Location: Federal Circuit, 717 Madison Place (on LaFayette Square), Courtroom 203.
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