|R&D Tax Credit
|5/23. The Senate approved the Restoring Earnings to Lift
Individuals and Empower Families (RELIEF) Act of 2001, the
$1.35 trillion tax cut compromise bill, by a vote of 62 to 38.
Several amendments were adopted, including one offered by Sen. Orrin Hatch (R-UT)
which makes permanent the research and development tax credit,
and increases the increases alternative incremental credit.
|Export Administration Act
|5/23. The House
International Relations Committee held a hearing on the
Export Administration Act. Rep. Henry Hyde (R-IL),
Chairman of the Committee, said in his opening
statement that "the Commerce Department has in place
a series of regulations providing for the control and
monitoring of the export of sensitive commodities, including
high performance computers, software, machine tools and other
items." Sen. Mike Enzi
(R-WY) introduced S
149, the Export Administration Act, in the Senate on
January 23. It was amended and approved by the Senate Banking
Committee on March 22 by a vote of 19 to 1. It eases
restraints on the export of most dual use products, such as
computers and software. Rep. Hyde added that in light of S
149's "significance to our economic and national security
interests, we will give this legislation all the time and
attention it deserves ensuring that it receives a thorough
review and vetting." Kenneth Juster, the recently
confirmed Under Secretary for Export Administration, testified
at the hearing. He stated in his prepared
testimony that the Bush administration supports S 149.
|5/23. The House
Commerce Committee's Subcommittee on Oversight and
Investigations held a hearing titled "How Secure Is
Private Medical Information? A Review of Computer Security at
the Health Care Financing Administration and Its Medicare
Contractors." See, prepared testimony of witnesses: John
Van Walker and Jared
Adair (Health Care Financing Administration), Joseph
Vengrin and Ed
Meyers (Department of Health and Human Services), and Michael
Neuman (En Garde Systems, Inc.).
5/23. The FTC announced that TRUSTe, an Internet privacy
seal program, has been approved as a "safe harbor"
program under the terms of the Children's Online Privacy
Protection Act (COPPA). See, FTC
letter to TRUSTe and FTC release.
|FCC E-Rate Rules
|5/23. Wednesday, May 23 was the deadline to file comments
with the FCC in response to its Notice
of Proposed Rulemaking (NPRM) regarding revisions to the
method of subsidizing schools and libraries under its e-rate
program. The FCC's e-rate program subsidizes schools' and
libraries' expenses for telecommunications, Internet access,
and internal connections. The FCC has set the total subsidy
level at $2.25 Billion per year. The total annual requests for
these free subsidies now exceeds $2.25 Billion. The FCC
published 13 comments received on May 23 in in web site. See,
for example, comments submitted by Qwest,
Public Library, American
Library Association. (The NPRM is published at Federal
Register, May 8, 2001, Vol. 66, No. 89, at Pages 23204 -
|Online Fraud and Crime
|5/23. The House
Commerce Committee's Subcommittee on Commerce, Trade, and
Consumer Protection held a hearing titled On-line Fraud and
Crime: Are Consumers Safe? See, prepared testimony of
Swartz (Criminal Division, DOJ), Thomas
Kubic (FBI), Eileen
Harrington (FTC), Bruce
Townsend (Secret Service), Scott
Charney (Price Waterhouse Coopers), Susan
Grant (National Consumers League), and Mark
MacCarthy (Visa USA).
5/23. The FBI, Department of Justice, and the National White
Collar Crime Center announced that criminal charges have been
brought against approximately 90 individuals and companies as
part of a nationwide series of investigations into Internet
fraud, code named "Operation Cyber Loss". See, FBI
5/23. The U.S. Attorneys Office (SDCal)
unsealed an indictment returned by a grand jury of the U.S.
District Court (SDCal) against 20 individuals charging wire
fraud, mail fraud, securities fraud, and other crimes, in
connection with an operation that designed, developed and
marketed of a series of high tech and telecom related
securities which were not registered and which were
fraudulently described to investors as general partnerships.
|House Judiciary Committee
Adopts Anti Spam Bill
|5/23. The House
Judiciary Committee amended and approved HR 718, an anti
spam bill, on a voice vote, after a day long mark up session. Rep. Heather Wilson
(R-NM) and Rep. Gene
Green (D-TX) introduced the bill on February 14. The House Commerce Committee
approved an amended version on April 4. The two Committees'
versions are now substantially different. See, Commerce
Committee version adopted on April 4; see also, Judiciary
in the nature of a substitute, Goodlatte
amendment, and Hart
amendment, which were all adopted by the Judiciary
Committee on May 23.
The Commerce Committee version would criminalize sending
unsolicited commercial e-mail (UCE) to someone who has asked
to be removed from a distribution list. The bill would also
require UCE to be labeled as such. It would also give
individuals and ISPs separate causes of action for violation
of the act; and, it would give civil enforcement authority to
FTC, and a parens
patriae cause of action to the states. The
Judiciary Committee version eliminates any authority or cause
of action for the FTC, states, or individuals. It would
criminalize sending UCE with false header information, give a
private right of action to ISPs to recover actual or statutory
damages for sending UCE with false header information, and
require that e-mail that contains contains sexually oriented
advertisements to be labeled as such.
5/23. Rep. James
Sensenbrenner (R-WI), the Chairman of the Judiciary
Committee, stated that the "Wilson bill utilizes almost
every legal enforcement tool know to lawyers to regulate and
to litigate issues relating to unsolicited commercial e-mail.
These provisions are disproportionate to the harm or damage
caused by spam." He also stated that he is
"skeptical of the regulation of online commerce,
including e-mail marketing." He offered an amendment
in the nature of a substitute to HR 718 as reported by the
Commerce Committee. He then described it: "the substitute
would create new misdemeanor criminal provision to address the
issue of technical fraud. Technical fraud includes forging or
falsifying header and return information, thereby concealing
the sender's identity. Those who send fraudulent e-mail or pormography
often use technical fraud to conceal their true identities.
Furthermore, technical fraud is used to defeat Internet
service providers' and computer users' e-mail filters,
preferences, and other technologies designed to block unwanted
Zoe Lofgren (D-CA), who supported the Chairman's amendment
in the nature of a substitute, stated that "my desire is
to legislate as little as possible where the Internet is
concerned." She added that recipients of spam already
have a remedy: "hit the delete button."
Rick Boucher (D-VA) elaborated on criminalizing false
header information: "the Internet service providers have
now begun to use software that can detect large volumes of
e-mail that originate from a common source simultaneously. And
the software used by the ISP correctly interprets that e-mail
to be spam. And so, that filter employed by the ISP is
sufficient to keep that spam from reaching the recipient. What
the spammers have now started to do in order to defeat that
software is change in each of the items of e-mail that goes
out, and each of the items of the spam that is sent, a little
bit of the header information. The origination information may
be altered in each subsequent message. ... And what the
legislation ... would help to implement, is a means of
criminalizing the way in which spammers are now defeating the
ISPs software, because it would say that you cannot falsify
any of the header information."
Bob Goodlatte (R-VA) offered an amendment
to the amendment in the nature of a substitute to add a cause
of action for Internet service providers. It was approved. Rep. Melissa Hart (R-PA)
offered an amendment
to the amendment in the nature of a substitute to require the
labeling of e-mail that includes "sexually oriented
advertisements." Several members stated that it would be
held unconstitutional as a violation of the First Amendment.
Rep. Hart argued that is contains the same language as a
provision regulating U.S. Postal Service mail, which has been
upheld by the courts. Her amendment was approved on a voice
The Committee also rejected a pair of amendments that would
have created a private right of action for recipients of UCE.
The Committee also rejected an amendment offered by Rep.
Schiff that would have required UCE to be labeled as such. The
Committee then approved the amendment in the nature of a
substitute, as amended by the Goodlatte and Hart amendments.
It then reported HR 718, as so amended.
The bill may now proceed to the House floor, via the Rules Committee, which
might work with members of the Commerce and Judiciary
Committees to produce a compromise version. Last year, the
House overwhelmingly passed an earlier version of Rep.
Wilson's anti spam bill. HR 3113
(106th Congress) was passed by the House on July 18, 2000, by
a vote of 427 to 1;
but it was not acted upon by the Senate.
|E-Mail Address Harvesting
|5/23. Rep. Chris
Cannon (R-UT) offered an amendment
to the SPAM bill that would have banned the harvesting of
e-mail addresses from web sites for the purpose of sending UCE
to those addresses. Rep. Sensenbrenner stated that this was
"not the proper time and place to offer this
amendment." He stated that it "prejudices the
database and privacy debates." Rep. Sensenbrenner
promised to work on this issue with Rep. Cannon, who then
withdrew his amendment.
|9:30 AM. The Senate
Commerce Committee will hold a mark up session. The agenda
includes votes on pending nomination to the FCC (Michael
Powell, Michael Copps, Kevin Martin, and Kathleen Abernathy),
the FTC (Timothy Muris), and the Department of Commerce (Bruce
Mehlman, Kathleen Cooper, and Mari Cino). Location: Room 253,
10:00 AM - 12:00 NOON. The FCC's Advisory Committee for the
2003 World Radiocommunication Conference will hold its a
meeting. Location: FCC, Portals II, Room TW-C305 (Commission
Meeting Room), Washington DC.
10:30 AM. The House
Judiciary Committee's Crime Subcommittee will hold an
oversight hearing titled Fighting Cyber Crime: Efforts by
State and Local Officials. Location: Room 2237, Rayburn
2:00 PM. The Senate
Judiciary Committee has scheduled a hearing on competition
in the pharmaceutical marketplace, focusing on the antitrust
implications of patent settlements. Location: Room 226,
|Friday, May 25
|Deadline to file reply comments with the FCC in
response to its request for comments regarding the cable
ownership limits imposed upon AT&T by the FCC in its
AT&T Time Warner merger review proceeding, in light of the
March 2, 2001, opinion of the U.S. Court of Appeals in Time
Warner v. FCC, 249 F.3d 1126 (D.C. Cir. 2001). (CS Docket
No. 99-251.) See, FCC notice.
Deadline to file comments with the SEC in
response to its web
based survey concerning investor use of electronic media
in making investment decisions. See original
notice setting deadline of July 1, and May 21 notice
moving the deadline up to May 25.
|People and Appointments
|5/23. FCC Commissioner Harold Furchtgott- Roth
announced that, after leaving the FCC, he will join the American Enterprise Institute (AEI)
as a visiting fellow. At AEI, he will write a book on
telecommunications policy. See, FCC release.
5/23. Sarah Whitesell will become the Associate Chief
of the FCC's Cable Services
Bureau, effective June 21, 2001. She is currently a legal
advisor to FCC Commissioner Gloria Tristani. Before joining
the FCC she was an associate at the law firm of Wilmer Cutler & Pickering.
5/23. FCC Commissioner Gloria Tristani announced several
changes to her personal staff. Senior Legal Advisor William
Friedman and Legal Advisor Sarah Whitesell will
depart in June. Former advisors Paul Gallant and Deena
Shetler will rejoin Tristani's staff. Gallant will be
Legal Advisor for mass media and cable issues, and Shetler
will be Legal Advisor for common carrier issues. Adam
Krinsky, who covers wireless and international issues,
will be Senior Legal Advisor. See, release.
5/23. President Bush announced his intent to nominate William
Riley to serve as a Judge on the United States Court of
Appeals for the Eighth Circuit. See, release.
5/23. The House
Judiciary Committee added Rep. Adam Schiff
(D-CA) and Rep. Anthony
Weiner (D-NY) to the membership of the Subcommittee on
Courts, Internet and Intellectual Property. Rep. Weiner also
left the Subcommittee on Crime.
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