Tech Law Journal Daily E-Mail Alert
June 12, 2001, 8:00 AM ET, Alert No. 206.
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Boucher & Issa Introduce Internet Distance Learning Bill
6/7. Rep. Rick Boucher (D-VA) and Rep. Darrell Issa (R-CA) introduced HR 2100, a bill to amend copyright law to facilitate distance learning. The bill would amend 110(2) and 112 of the Copyright Act to extend the distance learning exemptions enacted in 1976 to digital delivery media. The bill was referred to the House Judiciary Committee, of which both Boucher and Issa are members. This bill is similar, but not identical, to the S 487, which the Senate passed by unanimous consent on June 7. The Senate bill, but not the House bill, contains a requirement that the USPTO prepare a report for the Judiciary Committees "describing technological protection systems that have been implemented, are available for implementation, or are proposed to be developed to protect digitized copyrighted works and prevent infringement".
Washington Wonks Debate National E-Commerce Strategy
6/11. The Progressive Policy Institute (PPI) hosted a panel discussion titled Do We Need a National E-Commerce Strategy? in the Cannon House Office Building in Washington DC. The panelists were Rob Atkinson (PPI's Technology and New Economy Project), Adam Theier (Cato), Jeff Eisenach (Progress & Freedom Foundation), and Mark Cooper (Consumer Federation of America).
Atkinson argued for a national e-commerce strategy. See also, a report [PDF] authored by Atkinson. He proposed that the federal government should spend more on research and development, work to resolve "chicken and egg problems" (he cited digital certificates as an example), fight resistance of middlemen (such as car dealers) to disintermediation by Internet based sales, deal with threats to e-commerce from European companies, and promote e-government.
Eisenach agreed that the federal government should spend more on R&D, promote e-government, and play an international leadership role. However, he criticized most of the rest of the PPI proposal. He stated that there needs to be less government, not more. He added that the federal government should also repeal the excise tax on telephones and refrain from regulating online privacy. Theier, of the libertarian Cato Institute, criticized the PPI proposal as "industrial policy." He argued that the government should not be picking winning and losing technologies under the guise of R&D funding or solving "chicken and egg problems". He also stated that middlemen, such as car dealers and wine distributors, represent a political failure, and should be dealt with through Constitutional challenges in court. Mark Cooper argued in favor of open access.
The Progressive Policy Institute, which is a Washington DC based Democratic think tank, also released a report titled "Stop Subsidizing Off-line Consumers." The report argues that the cost to many companies of providing goods and services online is less than the cost for offline transactions, yet prices to consumers do not reflect this. The report cites as examples airline ticket sales, consumer banking, and music sales. The report makes no recommendations for government action. The report was written by Robert Atkinson.
Microsoft v. Bristol
6/11. The U.S. Court of Appeals (2ndCir) issued its opinion in Microsoft v. Bristol Technology vacating Judge Hall's award of $1 Million in punitive damages based upon a jury verdict that awarded Bristol $1 in compensatory damages.
Bristol filed its 14 count Complaint in the U.S. District Court (DConn) against Microsoft in 1998. 12 of the counts alleged violations of federal or state antitrust law. The jury ruled for Microsoft on all of these counts. A very small part of the case was a claim that Microsoft violated the Connecticut Unfair Trade Practices Act (CUTPA). Last July, the jury found that Microsoft had violated CUTPA, but awarded Bristol only $1 in compensatory damages. U.S. District Court Judge Hall then awarded Bristol $1,000,000.00 in punitive damages. Subsequently, the parties reached a settlement, under which Bristol agreed not to oppose this motion for vacatur.
Unlike the more famous antitrust trial before Judge Thomas Jackson in the District of Columbia, which involved Microsoft's Windows operating systems for desktop PCs, this Connecticut case involved Microsoft's NT operating systems for workstations and servers. Microsoft would not give NT 4.0 source code to Bristol under the terms sought by Bristol; and this, Bristol alleged, violated antitrust law. Bristol alleged monopoly leveraging of Microsoft's alleged monopoly of PC operating systems, refusal to deal in connection with its alleged monopoly in workstation operating systems, refusal to deal in connection with its alleged monopoly in departmental server operating systems, denial of an alleged essential facility, and attempted monopolization of the markets for workstation and departmental server markets. The Complaint also alleged six violations of Connecticut antitrust law.
This opinion was issued on May 17, but was only just published in the Second Circuit's web site. See also, TLJ Summary of Bristol v. Microsoft.
Trade News
6/11. Commerce Secretary Donald Evans gave a speech on free trade and trade promotion authority at a dinner at the Woodrow Wilson International Center for Scholars in Washington DC. He reiterated the theme that free trade is a moral imperative, and that to effectively negotiate free trade agreements with other nations, the President must have fast track trade promotion authority.
6/9. The USTR announced that the U.S. and the PRC "have reached consensus on remaining bilateral concerns related to China's WTO accession, indicating that both countries plan to work together in Geneva to complete China's WTO accession. In addition, both countries will work closely with other WTO members to build on the consensus reached by the United States and China this past week in Shanghai." See, USTR release.
New Documents
Boucher: HR 2100, a bill to amend copyright law to facilitate distance learning, 6/7 (HTML, LibCong).
Evans: speech re free trade and trade promotion authority, 6/11 (HTML, DOC).
USCA: order in Cadence v. Avant certifying a question to the California Supreme Court re theft of trade secrets statute, 6/11 (PDF, USCA).
USCA: opinion in Microsoft v. Bristol vacating Judge Hall's award of $1 Million in punitive damages to Bristol, 5/17 (HTML, USCA).
SCUS: opinion in Kyllo v. US re search and seizure, 6/11 (PDF, SCUS).
USCA: opinion in B&B Hardware v. Hargis, a trademark infringement, 6/11 (PDF, USCA).
9th Circuit Certifies Trade Secrets Question to California Court
6/11. The U.S. Court of Appeals (9thCir) issued an order [PDF] in Cadence v. Avant certifying a question to the California Supreme Court in a theft of trade secrets case. The question is: "Under the California Uniform Trade Secrets Act ("UTSA"), Cal. Civ. Code 3426, when does a claim for trade secret infringement arise: only once, when the initial misappropriation occurs, or with each subsequent misuse of the trade secret?"
Cadence and Avant compete in the field of integrated circuit design automation. A key employee of Cadence left to go to work for Avant. Cadence objected. After negotiations, the two companies entered into a settlement agreement that included a mutual general release. It was later discovered that Avant had copied certain Cadence source code line by line prior to the date of the release. Cadence filed a complaint in U.S. District Court (NDCal) against Avant alleging theft of its copyrighted and trade secret source code. Avant argued that because Cadence had released all its claims existing at the time of the release, any claims based on continuing or future misuse of trade secrets that were stolen prior to the date of the release are barred. Cadence argued that the only claims it had released were those for misappropriation occurring before the effective date of the release, and not claims for continuing misuse of its trade secrets after the date of the release. The Appeals Court wrote that the question certified to the California Supreme Court is dispositive of the case, yet not answered by the statute or California precedent.
FCC Commissioner Copps Picks Staff
6/11. FCC Commissioner Michael Copps announced the appointment of three interim members of his personal staff: Jordan Goldstein, Susana Zwerling, and Lauren Van Wazer. See, FCC release.
Goldstein, who was named Senior Legal Advisor, will focus on common carrier matters. Goldstein was previously a legal advisor to former Commissioner Susan Ness. Goldstein has also been legal counsel to the Chief of the Common Carrier Bureau (CCB), an attorney in the CCB's Policy and Program Planning Division, and before that, an attorney at the NTIA.
Zwerling was named interim Legal Advisor; she will focus on mass media and cable issues. She was previously Assistant Bureau Chief for Planning and Communication in the Mass Media Bureau (MMB). Prior to that she was special counsel to the Chief of the MMB, and an attorney advisor in the Policy and Rules Division. Before joining to the FCC in 1997 she was a trial attorney in the Telecommunications Task Force of the Antitrust Division of the Department of Justice. And prior to that, she was an associate in the New York City office of the law firm of Debevoise & Plimpton. She also was a legislative assistant to former Representative and now Sen. Charles Schumer (D-NY).
Van Wazer was named interim Legal Advisor; she will focus on wireless and international issues. She was previously a senior staff attorney in the Commercial Wireless Division of the FCC's Wireless Telecommunications Bureau. Prior to that she was an associate at the law firm of Arnold & Porter. In addition, Ms. Van Wazer also has a background in engineering, a rarity amongst the multitude of lawyers at the FCC. She is a graduate of the University of Pennsylvania's Moore School of Electrical Engineering, where she received a B.S.E. in Systems Science Engineering. She also worked in AT&T's Network Services Department.
Sachs Addresses NCTA Convention
6/11. NCTA P/CEO Robert Sachs gave a speech at the NCTA convention in Chicago, Illinois, in which he asserted that "cable is one industry where the 1996 Telecommunications Act has produced real consumer benefits. Rate deregulation has enabled us to invest billions in new technology, new programming and customer care, bringing competitive choices to consumers." He continued that "We're not only competing with DBS for every subscription television viewer, we're competing vigorously with phone, wireless and satellite companies to provide consumers high-speed data. And cable companies are the only facilities- based competitors to the regional Bell monopolies in residential markets. Despite all the obstacles, we now serve more than one million residential phone customers. And Internet protocol telephony promises an even more efficient means to deliver voice over cable."
Section 605 Broadcast Rights
6/11. The U.S. Court of Appeals (6thCir) issued its opinion in National Satellite Sports v. Time Warner, a case regarding broadcast rights. National Satellite Sports (NSS) obtained the exclusive right to broadcast a boxing match to commercial establishments in Ohio. Time Warner obtained the exclusive right to broadcast the event on a pay per view basis to its Ohio residential customers. A business was erroneously listed as a residential customer of Time Warner, and ordered the event through Time Warner's service. NSS filed a complaint in U.S. District Court (NDOhio) against that customer and Time Warner alleging violation of the Federal Communications Act of 1934, 47 U.S.C. 151-613, which prohibits the unauthorized divulgence of wire or radio communications. The District Court entered summary judgment in favor of NSS. The Appeals Court affirmed.
Suggestive v. Descriptive Trademarks
6/11. The U.S. Court of Appeals (8thCir) issued its opinion [PDF] in B&B Hardware v. Hargis, a trademark infringement case. B&B filed a complaint in U.S. District Court (EDArk) against Hargis alleging trademark infringement. The District Court entered judgment upon a jury verdict of noninfringement. B&B appealed on the sole issue of a jury instruction regarding the distinction between suggestive and descriptive marks. The Appeals Court affirmed. 
More News
6/11. The FCC's Office of Engineering and Technology hosted a tutorial on the use of graphical models (GMs) for speech recognition. GMs are flexible statistical abstractions that offer promising new approaches to automatic speech recognition. This was one of a series of technology tutorials offered by the FCC.
6/11. The Cellular Telecommunications & Internet Association (CTIA) announced its new Board of Directors and Executive Committee for 2001 - 2002. Rick Ekstrand of Rural Cellular Corporation was elected Chairman, Tim Donahue of Nextel Communications was elected Vice Chairman, Mohan Gyani of AT&T Wireless was elected Secretary, and Terry Addington of First Cellular of Southern Illinois was elected Treasurer. See, release.
Tuesday, June 12
8:30 AM - 5:00 PM. The American Antitrust Institute will hold its 2nd Annual Conference. See, agenda and registration page. (The price to attend is $600.) Location: National Press Club, 529 14th Street, NW, Washington DC. The schedule is as follows:
  8:50. Keynote Address by Mike Scherer.
  9:30. Panel titled "Antitrust in the New Economy".
Norman Hawker will moderate; Lawrence Sullivan will address "The New Economy: Has Competition Policy Become Irrelevant?"; James Langenfeld will address "An AAI Position on Intellectual Property".
  10:50. Panel titled "In the Arena". Jonathan Cuneo will moderate; Arthur Kaplan will address "Antitrust as a Public Private Partnership: Case Study of the NASDAQ Litigation"; Stephen Ross will address "A Report of the AAI Committee on Sports and Antitrust".
  11:45. Reception.
  12:30. Luncheon. FTC Chairman Timothy Muris will speak.
  1:45. Panel titled "Mergers". Robert Lande will moderate; John Kwoka will address "The Reinvigoration of Potential Competition Doctrine"; Robert Skitol will address "Moving Toward Guidelines for the Merger Consent Decree Process".
  3:15-4:45 Panel titled "The Courts and Antitrust." Rudolph Peritz will moderate; Warren Grimes will address "The Importance of the Kodak Case"; and William Kovacic will address "The Judiciary and Prospects for Post-Chicago Antitrust".
9:00 AM. The Bureau of Export Administration's Regulations and Procedures Technical Advisory Committee (RPTAC) will hold a meeting, the first part of which will be open to the public, and the second part of which will be closed. The RPTAC advises the BXA on the implantation of the Export Administration Regulations (EAR). Location: Room 3884, Hoover Building, 14th Street between Constitution and Pennsylvania Avenues, NW., Washington DC. See, notice in Federal Register, May 29, 2001, Vol. 66, No. 103, Pages 29079 - 29080.
11:30 AM - 4:00 PM. The Information Technology Association of America's Immigration Policy Committee hold a meeting. The first portion of the meeting will be held at the ITAA's headquarters at 1401 Wilson Blvd., Arlington, VA. It will be chaired by John Brendel (VP and Counsel of iGate Capital). The second portion of the meeting will be held in Room 5320, Conference Room 6, Department of Labor, 200 Constitution Ave., NW, Washington DC, and will include Department of State, Immigration and Naturalization Service, and Department of Labor officials. See, ITAA notice.
12:30 PM. FTC Chairman Timothy Muris will be the luncheon speaker at the 2nd Annual Conference of the American Antitrust Institute. Location: National Press Club, Ballroom, 529 14th Street, NW, Washington DC.
2:00 PM. The House Judiciary Committee's Subcommittee on the Constitution will hold an oversight hearing titled "Constitutional Issues Raised by Recent Campaign Finance Legislation Restricting Freedom of Speech." Location: Room 2141, Rayburn Building.
2:30 PM. The House International Relations Committee will hold a hearing titled "The Export Administration Act: The Case for Its Renewal (Part II)". Location: Room 2172, Rayburn Building.
4:00 PM. The House Judiciary Committee's Subcommittee on Crime will hold an oversight titled "Fighting Cyber Crime: Efforts by Federal Law Enforcement." Location: Room 2237, Rayburn Building.
6:00 - 8:00 PM. The Federal Communications Bar Association's Professional Responsibility Committee will host a CLE Seminar titled Ethics in the Electronic Age--Confidentiality, Diligent Representation, Privilege and More. The scheduled speakers are Thomas Morgan (GWU Law School), Mark Foster and Deborah Jeffrey (Zuckerman Spaeder), and John Quale (Skadden Arps). The price to attend is $60 (members) or $80 (non-members). RSVP to Arlice Johnson at arlice@fcba.org. Location: Wiley Rein & Fielding, 10th Floor Conference Room, 1750 K Street, NW, Washington DC.
Wednesday, June 13
10:00 AM. The House Judiciary Committee will meet to mark up HR 1542, the Tauzin Dingell bill, and HR 1698, the Cannon Conyers bill. Location: Room 2141, Rayburn Building.
10:00 AM. The Senate Banking Committee will hold a hearing on the nomination of Roger Ferguson to be a Member of the Board of Governors of the Federal Reserve System. Ferguson, who is currently a Governor, was the Board of Governors' point man on Year 2000 conversion preparations. Sen. Paul Sarbanes (D-MD), the new Chairman of the Committee, will preside. See, notice. Location: Room 538, Dirksen Building.
10:00 AM - 12:00 NOON. The House Science Committee will meet to mark up HR 100, the National Science Education Act, sponsored by Rep. Vern Ehlers (R-MI), and HR 1858, the National Mathematics and Science Partnerships Act, sponsored by Rep. Sherwood Boehlert (R-NY). Location: Room 2318, Rayburn Building.
10:00 AM. The FCC's Office of Engineering and Technology will host the first meeting of the Technological Advisory Council under its new charter. Location: FCC, 445 12th Street, SW, Washington, DC. See, FCC notice.
12:30 PM. The Federal Communications Bar Association's Transactional Practice Committee will host a brown bag lunch titled Factors Used to Value Communications Properties. Location: Dow Lohnes & Albertson, Conference Center, Eighth Floor, 1200 New Hampshire Ave., NW, Washington DC. RSVP to John Logan.
Deadline for submitting petitions to the USTR regarding the 2001 Annual GSP Product and Country Eligibility Practices Review. See, notice in the Federal Register, April 13, 2001, Vol. 66, No. 72, Pages 19278 - 19279.
Supreme Court Opines on Searches
6/11. The Supreme Court of the U.S. issued its opinion [PDF] in Kyllo v. U.S., a case holding that the thermal imaging of a home to detect lamps used for growing marijuana constitutes a search within the meaning of the Fourth Amendment. This is not a tech case. However, the analysis of the court may be of interest to those who are concerned about how the Supreme Court will ultimately rule in cases involving government acquisition of computer and Internet based communications. Also, the breakdown may be of interest. Scalia wrote the opinion, and was joined by Thomas, Souter, Ginsburg and Breyer. The Court did not split on ideological grounds. It was the older members the Court, Rehnquist, O'Connor, Stevens, and Kennedy, who dissented.
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