Tech Law Journal Daily E-Mail Alert
April 4, 2001, 8:00 AM ET, Alert No. 158.
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Privacy Hearing
4/3. The House Commerce Committee's Subcommittee on Commerce, Trade and Consumer Protection held a hearing titled An Examination of Existing Federal Statutes Addressing Information Privacy. Rep. Cliff Stearns (R-FL) presided. This is the third online privacy hearing held by this subcommittee this year. The first two focused on the EU privacy directive, and legal perspectives on proposals for federal regulation of online privacy. This hearing addressed existing laws relating to privacy. It also served to emphasize the point that there are already many statutes on the books regulating privacy.
Rep. Billy Tauzin (R-LA), the Chairman of the full committee, cautioned against the "real and potential unintended consequences in current statutes" in his prepared statement. He elaborated that "while everyone agrees with protecting the privacy of children as they navigate the Internet, experience suggests that the existing statute, the Child Online Privacy Protection Act (COPPA), has forced companies to discontinue a number of products targeted towards children." Rep. John Dingell (D-MI), the Ranking Member of the full committee, criticized the "unbalanced, unfair, or arbitrary witness selection".
The subcommittee heard from nine witnesses in two panels. (Hyperlinks are to the witnesses prepared testimony.)
 • Michael Lamb (Chief Privacy Officer, AT&T ) testified regarding the Customer Propriety Network Information provisions of the Communications Act, the Cable Communications Policy Act, the Telephone Consumer Protection Act, and the Electronic Communications Privacy Act.
 • Anne Fortney (Managing Partner, Lovells) testified regarding the Fair Credit Reporting Act (FCRA), and argued that it should not serve as a paradigm for online privacy legislation.
 • Rick Fischer (Morrison and Foerster) testified regarding the Gramm Leach Bliley Act (GLBA) privacy provisions.
 • Ronald Plesser (Piper Marbury) explained and criticized the Children's Online Privacy Protection Act.
 • Richard Varn (Chief Information Officer, Iowa) testified regarding state perspectives on privacy.
 • Ed Mierzwinski (USPIRG) testified regarding GLBA and the FCRA.
 • Richard Smith (CTO, The Privacy Foundation) explained TiVo's technology and it effects viewers' privacy; he also cautioned that TiVo is just "the tip of the iceberg" -- forthcoming web enabled devices have the potential to impact users' privacy.
 • Frank Torres (Consumers Union).
 • Jonathon Zuck (Association for Competitive Technology).
SEC 10b Action
3/29. The SEC filed a civil complaint in U.S. District Court (DDC) against Sean St. Heart alleging violation of § 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder for engaging in a cyber smear by posting a false message about NCO Group, Inc. on the Yahoo! Finance Internet message board. St. Heart's fraudulent message caused NCO's market capitalization to drop by over $200 Million. Also on March 29, St. Heart consented to entry of judgment against him. See, SEC release
4/3. The NTIA and FTC held a public workshop on the benefits and burdens of requiring consumer consent to receive information electronically. These agencies are required by the E-SIGN Act, passed last year, to conduct a study.
More News
4/3. AMD filed a complaint in state court in New York against Alcatel Business Systems alleging breach of a contract in connection with the sale of flash memory products to Alcatel. See, AMD release.
4/3.The House Government Reform Committee's Technology and Procurement Subcommittee held a hearing titled "Enterprise-Wide Strategies for Managing Information Resources and Technology: Learning From State and Local Governments". See, prepared testimony [PDF] of David McClure, GAO Director of Information Technology Issues.
4/2. Sen. Charles Schumer (D-NY) introduced S 671, a bill to provide for public library construction and technology enhancement. It was referred to the Senate Committee on Health, Education, Labor, and Pensions.
3/30. The GAO released a report [PDF] titled "Information Security: Progress and Challenges to an Effective Defense-wide Information Assurance Program."
4/2. The GAO released a report [PDF] titled "Information Management: Electronic Dissemination of Government Publications."
4/3. The NTIA published a notice in the Federal Register requesting comments regarding "the advantages accorded signatories of the INTELSAT, in terms of immunities, market access, or otherwise, in the countries or regions served by INTELSAT, the reason for such advantages, and an assessment of progress toward fulfilling a pro-competitive privatization of that organization." Comments are due by May 3, 2001. See, Federal Register, April 3, 2001, Vol. 66, No. 64, Notices, at Pages 17686 - 17687. See also, copy of notice in NTIA web site.
New Documents
BermanHR 1333, the Business Method Patent Improvement Act of 2001, 4/3 (HTML, TLJ).
Berman: H.Res 110, re ending diversion of USPTO fees, 4/3 (HTML, TLJ).
Tauzin: paper re FCC reform, 4/3 (PDF, PFF).
Business Method Patents Bill Introduced
4/3. Rep. Howard Berman (D-CA) and Rep. Rick Boucher (D-VA) introduced HR 1333, the Business Method Patent Improvement Act of 2001. This bill is a revision of a similar bill (HR 5364) introduced by Reps. Berman and Boucher last October at the end of the 106th Congress. The new bill, HR 1333, requires the USPTO to publish all business method patent applications after 18 months. It creates opportunities for the public to present prior art or public use information before a business method patent issues. It also establishes a process where parties can challenge a granted business method patent in an expeditious, less costly alternative to litigation. "We must make sure that business method patents now issued are of the highest quality," Rep. Berman said in a releae. "Since questions have arisen about whether this is the case, Congress must take a close look at how the U.S. patent system is functioning in this new, and rapidly growing area of patenting."
4/3. The House Judiciary Committee's Courts, Internet and Intellectual Property Subcommittee will hold a hearing on April 4. Rep. Berman is the Ranking Member of this subcommittee, and Rep. Boucher is one of its senior members. The Senate Judiciary Committee will take up the issue after the two week Easter recess. It is scheduled to hold a hearing on business method patents on May 1, and a hearing on genetic and biotech patents on May 8.
4/3. Reps. Berman and Boucher also introduced HR 1332, the Patent Improvement Act of 2001. It would establish a process by which a party could challenge any granted patent in an expeditious, less costly alternative to litigation.
Diversion of USPTO Fees
4/3. Reps. Berman and Boucher also introduced H.Res 110, a resolution to bar the House from permitting the diversion of USPTO user fees to fund other government programs. It provides that "it shall not be in order in the House of Representatives to consider any bill, joint resolution, amendment, motion, or conference report that makes available funds to the United States Patent and Trademark Office for any fiscal year, or for any other period for which the funds are provided, in amounts less than the total amount of patent and trademark fees collected by the United States Patent and Trademark Office ..."
USPTO Recruiting
4/3. The USPTO held a recruitment meeting for students majoring in engineering, science or computer science who may be interested in becoming patent examiners. For more information, contact or See also, notice.
Napster News
4/3. The Senate Judiciary Committee held a hearing on online entertainment and copyright law. See, opening statements of Sen. Orrin Hatch and Sen. Pat Leahy, the Chairman and Ranking Member of the Committee. See also, prepared testimony of witnesses: Richard Parsons (AOL TimeWarner), Jack Valenti (MPAA), Don Henley, Alanis Morissette, Hank Barry (Napster), Steve Gottlieb (TVT Records), Ken Berry (EMI), Gerry Kearby, Liquid Audio), Hilary Rosen (RIAA), Robin Richards (, Ed Murphy (NMPA), Mike Farrace (Tower Records), Sally Greenberg (Consumers Union), and Edmund Fish (InterTrust Technologies).
4/3. The U.S. Court of Appeals (9thCir) issued an order revising its slip opinion of February 12 in A&M Records v. Napster. There are only three minor changes to citations.
3G Spectrum
4/3. The Network for Instructional TV (NITV), which holds 23 ITFS licenses issued by the FCC, filed a comment [PDF] with the FCC opposing Verizon's petition to the FCC [PDF] of March 27 to defer action on ITFS and MDS applications. NITV stated that "Verizon's shrill, eleventh-hour claim that the ITFS/MDS spectrum must be frozen in time pending the outcome of the 3G proceeding shamelessly ignores longstanding FCC rules and policies and the need of American students and teachers for prompt access to broadband educational services." Third Generation (3G) wireless technologies are intended to extend broadband Internet access to portable devices. The FCC is examining whether spectrum in the 2500-2690 MHz band might be reallocated, shared or segmented, for use by 3G technologies. MDS and ITFS operators are incumbent users of spectrum in this band, and don't want to give it up their licenses. See, FCC's ET Docket No. 00-258.
4/3. The GAO released a report [PDF] titled "Free Trade Area of the Americas: Negotiations at Key Juncture on Eve of April Meetings." The report precedes the meeting of the trade ministers of 34 countries in negotiations in Buenos Aires, Argentina, on April 7, and the Summit of the Americas in Quebec City, Canada, on April 20-22. The report concludes that "Significant challenges will need to be overcome to successfully conclude an agreement."
4/3. The Department of Commerce's Bureau of Export Administration published a notice in the Federal Register that its Information Systems Technical Advisory Committee (ISTAC) will meet on April 18 & 19, 2001 at 9:00 AM in the Herbert C. Hoover Building, Room 3884, 14th Street between Pennsylvania Avenue and Constitution Avenue, NW., Washington, DC. The ISTAC advises the Office of the Assistant Secretary for Export Administration on technical questions that affect the level of export controls applicable to information systems equipment and technology. See, Federal Register, April 3, 2001, Vol. 66, No. 64, Page 17683.
Tauzin Advocates FCC Reform
4/3. Rep. Billy Tauzin (R-LA), Chairman of the House Commerce Committee, published a paper [PDF] titled "Telecom Deregulation, Broadband Deployment, and Economic Growth." The paper was published by the Progress and Freedom Foundation.
He said that the FCC should regulate all broadband services the same. "It is not enough to say that the FCC is structured badly. That is obvious. You have only to look at its bureaus to see that these distinct bureaus were built around an age when communications facilities and services were monopolies, providing distinct functional services in distinct geographical areas. That structure doesn’t fit today's marketplace ... Why should we have different regulation for broadband delivery on a satellite, as opposed to a cable, as opposed to a telephone DSL line, as opposed to a wireless delivery terrestrial system, if it's all the same product that is delivered to the consumer?"
Rep. Tauzin next advocated reform of the FCC's merger review process. He stated that it "has used the process for considering applications for license renewals and license transfers associated with mergers to implement a form of personalized, subjective regulation, which borders upon unconstitutionality."
He also addressed the FCC's e-rate subsidy program. He stated that "When the FCC gave us the E-Rate, a massive tax upon telephone consumers to carry out a building program in the education and hospital and library areas of our country, there was a blurring of all kinds of lines that our founding fathers attempted to draw in our basic structure of government. Here, the FCC is passing taxes; directing corporations to spend money without Congressional oversight and review, or appropriation; and, in fact, executively deciding who gets and who doesn’t get the benefit of these dollars in a way that I believe offends the basic structure of our government." He added that "That sort of activity by the FCC has to stop" and proposed a "blue ribbon commission to work with GAO and provide recommendations".
Tauzin also noted that IT and energy policy are intertwined. "The dot-com and IT sectors of our economy are actually energy guzzlers. ... If we're going to rebuild the IT sector with competent and courageous deregulation, we are going to have to complement it with access to affordable energy. Hence, we need a prompt rewrite of national energy policy."
4/3. President Bush announced his intent to nominate Bruce Mehlman to be Assistant Secretary of Commerce for Technology Policy. Mehlman is currently Telecommunications Policy Counsel for Cisco. Previously, he was General Counsel and Policy Director for the House Republican Conference and General Counsel for the National Republican Congressional Committee. See, release.
The House will debate HR 8, the Death Tax Elimination Act, sponsored by Rep. Jennifer Dunn (R-WA).
The Senate will continue its debate of President Bush's budget proposal.
10:00 AM. The Senate Finance Committee will hold a hearing titled International Trade and the American Economy. The witnesses will be Alan Greenspan and Mickey Kantor. Location: Room 215, Dirksen Building.
10:00 AM. The House Commerce Committee's Telecom Subcommittee will hold a hearing titled the E-Rate and Filtering: A Review of the Children's Internet Protection Act. Location: Room 2322, Rayburn Building.
10:00 AM. The Senate Finance Committee will hold a hearing on international trade and the American economy. Location: Room 215, Dirksen Building.
10:00 AM. The Senate Judiciary Committee's Antitrust, Business Rights, and Competition Subcommittee will hold a hearing to examine competitive choices concerning cable and video. Sen. Mike DeWine (R-OH) will preside. Room 226, Dirksen Building.
1:30 PM. FCC Commissioner Harold Furchtgott-Roth will address the Second Telecommunications Policy and Law Symposium. Location: Capital Hilton, Washington DC.
2:00 PM. The Senate Judiciary Committee's Immigration Subcommittee will hold a hearing on immigration policy. Sen. Sam Brownback (R-KS) will preside. Room 226, Dirksen Building.
2:00 PM. The House Judiciary Committee's Subcommittee on Courts, Internet, and Intellectual Property will hold a hearing on business method patents. Location: Room 2141, Rayburn Building.
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