|FTC Halts Deceptive Ads of
Juno and Gateway
|5/15. The Federal Trade
Commission (FTC) filed, and simultaneously settled, two
administrative complaints alleging deceptive advertising
practices in the marketing of Internet access services by Juno Online Services and Gateway. The FTC alleged
that various acts of Juno and Gateway constituted unfair or
deceptive acts or practices in or affecting commerce in
violation of § 5(a) of the Federal Trade Commission Act.
In particular, both companies advertised as "free"
services that were not in fact free. Both companies agreed to
stop misrepresenting the prices of their services.
The FTC filed an administrative
complaint [PDF] against Juno alleging that it
misrepresented that consumers who participated in its free
trial offers for its Premium Internet service would be able to
cancel at any time before the free trial period ended and
incur no charges if they were not satisfied. The FTC and Juno
simultaneously settled the matter, with Juno agreeing to stop
misrepresenting the price of its Internet services, to clearly
and conspicuously disclose the cancellation terms for these
services, and to provide adequate customer support to handle
consumer requests to cancel. The proposed settlement also
requires Juno to reimburse certain former subscribers for long
distance telephone charges they incurred to use its services.
Containing Consent Order [PDF]. See also, FTC release.
The FTC filed a separate administrative
complaint against Gateway alleging that it misrepresented
that it provided one year of free service with Gateway.net
Internet access. The FTC and Gateway settled the matter, with
Gateway agreeing to stop misrepresenting the price of its
Internet services. See, Agreement
Containing Consent Order.
Jodie Bernstein, Director of the FTC's Bureau of Consumer
Protection, had this to say: "Free Internet access often
turned out too good to be true for many consumers, a fact made
clear by a significant volume of complaints by consumers to
the FTC. Hidden fees often lurked in minuscule fine print
tucked away at the end of ads or service agreements. Today's
agreement will help make sure more consumers don't get taken
for a ride on the Internet highway when it comes to the true
cost of Internet access." See, release.
The Commission voted 5-0 to proceed with both of these
complaints. The settlement agreements will be subject to
public comment, after which the Commission will decide whether
to make them final. It very likely will approve them.
|Software Defined Radio
|5/15. Intel submitted a reply
comment to the FCC in its proceeding regarding software
defined radio. Intel recommended that "SDR rules (1)
distinguish between radio control and user application
software and not impose certification requirements on user
application software and (2) permit a manufacturer to create
an open SDR platform that would enable third parties to
develop innovative programs that optimize RF parameters of the
radio and seek certification as a Class III permissive change
on their own. Experience in both the wireless and wired
industries demonstrates the workability and benefit of market
solutions that maintain network integration and foster the
development of innovative products." (See, In the Matter
of Authorization and Use of Software Defined Radio, ET Docket
|Sen. Hagel on Trade
|5/14. Sen. Chuck Hagel
(R-NE) gave an speech in the Senate on trade in which he
advocated free trade, granting the President fast track trade
negotiating authority, and launching a new round of WTO
negotiations. He also linked advancement of free trade to
human rights and stability. He stated: "Stability,
security, economics, markets, communications, trade, and
investments are all interconnected. ... Trade binds nations
together in strategic and political alliances. Throughout
history trade and commerce have been key instruments that have
helped break down totalitarian governments and dictatorships,
and opened the doors to democracy and higher standards of
living ... Trade and international investment have helped pave
the way for peace in many areas of the world. Trade and
democracy are interconnected. Trade and investment lead to
political and economic stability."
|Personal Jurisdiction in
|5/15. The U.S.
Court of Appeals (FedCir) issued its opinion in Inamed
v. Kuzmak, a case involving personal
jurisdiction in a patent case. Plaintiffs filed a complaint
for declaratory relief pertaining to four patents against
defendant Kuzmak in the U.S. District Court for the Central
District of California (Los Angeles). Kuzmak, who registered
the patents, resides in New Jersey. The plaintiffs are all
corporations with their principal places of business in
California. The District Court dismissed for lack of personal
jurisdiction over the defendant. The Appeals Court reversed.
Kuzmak had written an infringement letter to an attorney in
New York who was the registered agent for a corporation that
is a resident of California, and had negotiated license
agreements and received royalty payments that were based on
the manufacture of goods by a plaintiff in California; hence,
he satisfied the minimum contacts requirements of International
Shoe and its prodigy.
|More Intellectual Property
|5/15. The Senate
Judiciary Committee postponed indefinitely its hearing on patents
relating to business methods and the Internet. This
committee often postpones matters.
5/15. DirecTV released a
regarding a complaint that it filed on March 15 in U.S.
District Court (CDCal)
against 80 individuals alleging trafficking in illegal
signal theft equipment. DirecTV, which is a unit of Hughes Electronics Corp., is
a satellite television provider.
5/11. A trial jury of the U.S. District Court (NDIll)
returned a verdict of guilty against Christian Morley for
violation of the No
Electronic Theft Act (NET Act). The NET Act, which was
passed in 1997, amended copyright law to facilitate
prosecution of Internet based copyright infringement. Since
then, Justice Department prosecutions under the Act have been
rare. While other prosecutions have resulted in plea
agreements, this was the first case in which a jury convicted
a defendant under the Act. See, BSA
|5/15. Rep. Dick Armey
(R-TX) wrote a letter
to Secretary Tommy Thompson requesting that the Department of Health and Human
Services halt its ongoing plans to mandate a "unique
health identifier for individuals". Armey stated in his
letter that the plan is illegal under legislation passed in
1998. (See, Public Law 106-554, 106th Congress.) He also
stated that the plan would threaten the privacy of
individuals' medical records. Armey wrote:
"Imagine the implications for personal privacy if
everyone had a government- issued medical ID number and the
government had an unfettered search- and- seizure power over
private medical records. That unfettered search- and- seizure
power is currently poised to become law, thanks to the Clinton
privacy regulations that are being finalized right now. The
addition of a universal identifier would make that power all
the more troubling."
announced its intent to sign the Safe Harbor Agreement of the
EU data directive. See, release.
|ICANN & New TLDs
|5/15. The ICANN
finalized accreditation agreements with the new .biz and .info
top-level domain (TLD) registries. The registry operators,
NeuLevel for .biz and Afilias for .info, were among seven
registry operators for new TLDs selected by the ICANN Board of
Directors in November of 2000. Both agreements provide for a
multi step launch process, which allows trademark holders to
submit trademark claims before the application process is
opened. See, ICANN
U.S. Department of Commerce General Counsel Ted Kassinger
stated that ".biz and .info will offer consumer choice,
provide our entrepreneurs with new avenues to pursue their
ideas and are a welcome addition to the domain name
marketplace. We congratulate ICANN on this latest progress in
introducing competition consistent with maintaining Internet
stability." See, DOC release.
|The House will meet at 10:00 AM for legislative business.
The House may take up HR 1646, the State Department
Authorization Act, HR 622, the Hope for Children Act,
and/or HR 1, the No Child Left Behind Act of 2001. The
Senate will continue its consideration of S 1, a bill to
extend programs and activities under the Elementary and
Secondary Education Act of 1965.
9:30 AM. The Senate
Commerce Committee will hold a hearing on nominations to
the Federal Trade Commission and the Department of Commerce.
Location: Room 253, Russell Building. The agenda includes the
• Timothy Muris to be Chairman of the FTC.
• Kathleen Cooper to be Under Sec. of Commerce
for Economic Affairs.
• Bruce Mehlman to be Asst. Sec. of Commerce
for Technology Policy.
• Sean O'Hollaren to be Asst. Sec. for
1:30 PM. The Senate
Finance Committee will hold a confirmation hearing for
many nominees, including Linnet Deily and Peter
Allgeier to be Deputy USTRs. See, release
|Thursday, May 17
|9:30 AM. The Senate
Commerce Committee held a hearing on on nominations for
the Federal Communications Commission. Location: Room 253,
Russell Building. The agenda includes:
• Michael Powell to be FCC Chairman.
• Kathleen Abernathy to be a FCC Commissioner.
• Kevin Martin to be a FCC Commissioner.
• Michael Copps to be a FCC Commissioner.
10:00 AM. The House
Commerce Committee's Subcommittee on Telecommunications
and the Internet will hold a hearing HR
1765, a bill to increase penalties for common carrier
violations of the Communications Act of 1934. Location: Room
2123, Rayburn Building.
10:00 AM. The Senate Judiciary Committee may hold an executive
business meeting. Location: Room 226, Dirksen Building.
10:00 AM. The Senate
Appropriations Committee's Subcommittee on Commerce,
Justice, State, and the Judiciary will hold a hearing on
proposed budget estimates for FY 2002 for the FBI, DEA, and INS. Location: Room 192,
AM. The House Government Reform Committee's Subcommittee on
Government Efficiency, Financial Management, and
Intergovernmental Relations will hold a hearing titled
"Are Classified Computer Systems in the Federal
Government Adequately Protected?" It will meet in open
session at 10:00 AM, and in closed session at 1:30 PM.
Location: Room 2247, Rayburn Building.
1:00 PM. The House
Judiciary Committee's Subcommittee on the Courts, the
Internet, and Intellectual Property will hold a hearing titled
Music On The Internet. Location: Room 2141, Rayburn
|5/15. The Senate
Banking Committee met and voted on the nomination of James
Jochum to be Assistant Secretary of Commerce for Export
Administration. He was unanimously approved. There was no
debate or discussion.
5/15. The GAO wrote a letter [PDF]
to Rep. Steve Buyer
(R-IN), Chairman of the House
Veterans' Affairs Committee's Subcommittee on Oversight
and Investigations, regarding information technology practices
at the Veterans' Administration.
The letter responds to questions from Rep. Buyer regarding the
VA's lack of a Chief Information Officer, security weaknesses
at the VA, the VA's lack of an integrated department wide
enterprise architecture, and capital investment in information
technology at the VA.
5/15. The House
Judiciary Committee's Subcommittee on Immigration and
Claims held a hearing on the Immigration
and Naturalization Service (INS) and the Executive Office for
Immigration Review (EOIR). See, prepared testimony of
witnesses: Roy Beck
(Numbers USA), Kevin
Rooney (INS), Thomas
Wenski (National Conference of Catholic Bishops).
5/14. Rep. Bill
Barrett (D-WI) introduced HR
1825, the Consumer Debit Card Protection Act, a bill to
amend the Electronic Fund Transfer Act to safeguard consumers
in connection with the utilization of certain debit cards. The
bill was referred to the Financial
5/15. The U.S. Court
of Appeals (DC Cir) heard oral argument in U.S. Cell Corp.
v. FCC, Appeal No. 00-1072.
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