Tech Law Journal Daily E-Mail Alert
June 7, 2001, 8:00 AM ET, Alert No. 203.
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What Happened to the New Economy?
6/6. Federal Reserve Board Governor Laurence Meyer gave a long speech in New York City titled "What Happened to the New Economy?" He identified the "new economy" as "the dramatic acceleration in productivity tied, to an important degree, to innovations in information technology." He stated that there is a "sharp slowdown under way ... . I refer here to the correction in equity prices and the retrenchment of investment, both of which are centered on the high-tech area." He addressed the role of monetary policy in recent growth, and the slowdown. He also stated that "we are still in the new economy ... . The shape of the slowdown has the new economy written all over it, just as the shape of the earlier expansion did." He also concluded that "Recent developments have taught or re-taught us a number of such lessons. Equity prices can go down as well as up. Firms need profits to survive. Business cycles happen." He spoke to the New York Association for Business Economics and The Downtown Economists.
PSLRA Pleading Standard
6/6. The U.S. Court of Appeals (9thCir) issued its opinion [PDF] in Ronconi v. Larkin, a case regarding pleading standards in securities class action suits under the Private Securities Litigation Reform Act (PSLRA). The District Court dismissed for failure to state a claim. The Appeals Court applied the PSLRA, as previously interpreted by the Ninth Circuit in Janas v. McCracken (In re Silicon Graphics Sec. Litig.), 183 F.3d 970 (1999), to affirm the dismissal.
Computer and Internet Crime
6/6. The U.S. Court of Appeals (5thCir) issued its opinion in USA v. James Rhodes, an appeal in a criminal case. Defendant plead guilty to and was convicted of one count of traveling interstate with the intent to engage in a sexual act with a juvenile, in violation of 18 U.S.C. 2423(b). He had been communicating via the Internet with an undercover police officer. He appealed the District Court's refusal to withdraw his guilty plea, and his sentence. The Appeals Court affirmed.
6/6. Richard Morris was charged by Information [PDF] with one count of wire fraud in violation of 18 U.S.C. 1343 and one count of mail fraud in violation of 18 U.S.C. 1341. Morris also plead guilty to both charges in U.S. District Court (NDCal). Morris auctioned non- existent merchandise on Internet auction sites, including e-Bay and Yahoo. Assistant U.S. Attorney Jonathan Howden prosecuted the case. See, USAO release.
New Documents
USCA: opinion in Ronconi v. Larkin re pleading standards in securities class action suits, 6/6 (PDF, USCA).
Felton: complaint against RIAA and SDMI re constitutionality of anti circumvention provisions of the CDMA, 6/6 (HTML, EFF).
Meyer: speech re economic analysis of downturn of the economy, 6/6 (HTML, FRB).
Prof. Felton Challenges Constitutionality of DMCA Anti Circumvention
6/6. Edward Felton and others filed a complaint in U.S. District Court (DNJ) against the RIAA, SDMI Foundation, and others, seeking a declaration that the anti circumvention provision of the Digital Millennium Copyright Act is unconstitutional as a violation of free speech.
On April 9, Matthew Oppenheim, Secretary of the SDMI Foundation, wrote a letter to Felton, an associate professor in the Department of Computer Science at Princeton University, and others, warning them that public release of information concerning the Secure Digital Music Initiative (SDMI) "could subject you and your research team to actions under the Digital Millennium Copyright Act ..." At the time, Felton had been scheduled to participate in the 4th International Information Hiding Workshop on April 25-29 in Pittsburgh, Pennsylvania. The Secure Digital Music Initiative (SDMI) is a music industry group that is attempting to develop a watermark based system to prevent music piracy. Watermarking embeds copyright information in digital music files to enable devices like MP3 players and recorders to refuse to make copies of copyrighted music. Last year the SDMI issued a "Public Challenge" to help choose among four proposed watermarking technologies. It invited researchers to attempt to remove the copyright watermarks. Felton responded, and successfully defeated all four technologies. The SDMI sought to prevent Felton from presenting or publishing his findings.
The RIAA had this reaction: "Professor Felten's decision to sue the RIAA and the SDMI Foundation is inexplicable. We have unequivocally and repeatedly stated that we have no intention of bringing a lawsuit against Professor Felten or his colleagues. It seems that the professor, or the Electronic Frontier Foundation, would have preferred that we sue in order to keep their publicity machine running. Since we've said we have no issue with the publication of the Felten paper, they now resort to suing us to keep this issue alive." See, RIAA release.
Crater v. Lucent
6/6. The U.S. Court of Appeals (FedCir) issued its opinion in Crater v. Lucent. Plaintiff holds U.S. Patent No. 5,286,129 pertaining to an underwater coupling device for fiber optic cable. It filed suit in U.S. District Court (EDMo) against Lucent and AT&T alleging patent infringement and breach of contract and misappropriation of trade secrets under state law. Federal jurisdiction was based on the patent claim; there was not diversity of citizenship. Defendants moved to dismiss for lack of subject matter jurisdiction and for failure to state a claim, on the grounds that since their use of the invention was pursuant to contracts with the federal government (U.S. Navy), 18 U.S.C. 1498(a) provides that the only action available to the plaintiff is against the government in the U.S. Court of Federal Claims. The District Court agreed, and dismissed. In addition, the government asserted the military and state secrets privilege to prevent plaintiff from obtaining information about infringing use. It intervened in the District Court proceeding to prevent most discovery in that action. The Appeals Court affirmed the finding that Section 1498 bars the patent infringement action, but reversed the holding as to lack of jurisdiction. The Appeals Court held that there was jurisdiction over the patent claim, and hence, supplemental jurisdiction over the state law claims.
Thursday, June 7
10:00 AM. The House Commerce Committee's Subcommittee on Oversight and Investigations will hold a hearing on imported pharmaceuticals, including Internet sales. Location: Room 2123 or 2322, Rayburn Building.
12:00 NOON. The Congressional Internet Caucus Advisory Committee will host a luncheon and panel discussion on issues raised in the Tauzin Dingell and Cannon Conyers bills. RSVP to or telephone Danielle at 202-638-4370. Location: Room HC-5, U.S. Capitol Building.
2:00 PM. The House Judiciary Committee's Subcommittee on Courts, Internet and Intellectual Property will hold an oversight hearing on titled The Operations of the U.S. Patent and Trademark Office, Including Review of Agency Funding. Location: Room 2141, Rayburn Building.
Friday, June 8
Deadline to submit comments to the NTIA regarding its investigation of current and future use of radio frequency spectrum in the U.S. by providers of energy, water and railroad services, and how current and emerging technology trends affect use of the radio spectrum. The CJSJ appropriations bill for FY 2002 requires that the NTIA conduct this study. See, notice in Federal Register, April 9, 2001, Vol. 66, No. 68, at Pages 18448 - 18449. See also, copy of notice in NTIA web site.
Lans v. DEC
6/4. The U.S. Court of Appeals (FedCir) issued its opinion in Lans v. DEC, a patent infringement case. Hakan Lans, who was issued U.S. Patent No. 4,303,986, sued DEC and other computer equipment manufacturers alleging infringement of this patent. The District Court granted summary judgment to defendants on the grounds that Lans lacked standing, since he had assigned the patent to a entity not a party to the suit. The Appeals Court affirmed.
More News
6/6. The Senate Appropriations Committee's Subcommittee on VA, HUD, and Independent Agencies held a hearing on proposed budget estimates for FY 2002 for the National Science Foundation and the Office of Science Technology Policy.
6/6. The House Judiciary Committee held an oversight hearing on the Justice Department.  testified. See, prepared testimony of Attorney General John Ashcroft.
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