|FCC Files Petition for Writ
of Certioriari in NextWave Case
|10/19. The Federal
Communications Commission (FCC) filed a petition for writ
of certiorari with the Supreme Court of the U.S. in the NextWave spectrum
dispute. The FCC faced an October 19 deadline for filing.
NextWave obtained spectrum licenses at FCC auctions in 1996.
The FCC permitted NextWave to obtain the licenses, and make
payments under an installment plan, thus creating a debtor
creditor relationship between NextWave and the FCC. NextWave
did not make payments required by the plan, and filed a
Chapter 11 bankruptcy petition. The FCC cancelled the
licenses. The U.S.
Court of Appeals (DCCir) ruled in its June 22, 2001, opinion
that the FCC is prevented from canceling the spectrum licenses
by § 525
of the Bankruptcy Code.
The FCC now seeks review of this decision. It stated in its
cert petition that the issue is "Whether Section 525 of
the Bankruptcy Code, 11 U.S.C. 525, conflicts with and
displaces the Federal Communications Commission’s rules for
congressionally authorized spectrum auctions, which provide
that wireless telecommunications licenses obtained at auction
automatically cancel upon the winning bidder’s failure to
make timely payments to fulfill its winning bid." The FCC
elaborated that "the D.C. Circuit’s decision
dramatically expands the reach of bankruptcy law into an area
that Congress has traditionally reserved to the Commission
NextWave bid $4.74 Billion in 1996 for the spectrum licenses
at issue. The FCC recently re-auctioned the spectrum,
receiving $15.85 Billion in bids. Various press accounts,
citing anonymous sources, have stated in the last week that
NextWave, the FCC, and the re-auction winner are close to a
settlement. Also, FCC Chairman Powell has scheduled a press
conference for Tuesday morning, October 23.
|District Court Grants
Summary Judgment in PSINet v. Chapman
|10/11. The U.S.
District Court (WDVa) issued its order
and opinion [PDF] in PSINet
v. Chapman, granting summary judgment that the
1999 amendment to the Va.
Code Ann. § 18.2-391, which criminalizes the
dissemination by computer of material that is harmful to
minors, violates both the First Amendment and the Commerce
The District Court had previously enjoined enforcement of this
portion of the statute. See, Memorandum
Opinion and Order
dated August 8, 2001. See also, TLJ Story, Judge
Overturns Virginia Internet Porm Statute, August 10, 2000.
§ 18.2-391 is an anti porm provision that has long been on
the books; it was primarily directed at brick and mortar
businesses. However, the Virginia legislature amended the
statute in early 1999 to include any "electronic file or
message", thus making clear that it encompasses the
Internet. It is this aspect of the statute that the District
Court held unconstitutional.
Freedom of Speech. The Court concluded that § 18.2-391
is a content based restriction on expression protected by the
First Amendment that is "presumptively invalid and can
only be upheld if it survives strict scrutiny. ... To satisfy
strict scrutiny, the law in question must be (1) narrowly
tailored to (2) promote a compelling government
interest." The Court found that "the state's
asserted interest in protecting, and helping parents to
protect, minors from sexually explicit materials is
compelling." However, it also found that the statute was
not narrowly tailored. It reasoned that "A law is
narrowly tailored if it employs the least restrictive means to
achieve its goal and if there is a nexus between the
government’s compelling interest and the restriction."
The Court continued that "The pre- amendment version of
section 18.2-391 applied only to traditional media in physical
spaces, and thus made it possible to restrict minors’ access
to indecent material without substantially burdening adult
access. For example, in a brick and mortar bookstore, a
magazine considered harmful to minors can be wrapped in
protective covering and placed behind the counter where only
adults can purchase it. Presently, the same cannot be said for
material on the Internet. That is, efforts to comply with the
1999 Act will result in the exclusion of too many adults from
accessing material to be constitutionally sound."
Dormant Commerce Clause. Federal Judges have often
struck down anti porm and indecency statutes on First
Amendment grounds. However, the District Court in this case
also held that the statute violates the dormant Commerce
Clause of the Constitution. This part of the
opinion could have implications for state regulation of the
Internet and e-commerce.
The Court wrote that the "negative implication of the
Commerce Clause, U.S. Const. Art I., § 8, cl. 3, includes a
prohibition on state regulation that "discriminates
against or unduly burdens interstate commerce and thereby
"imped[es] free private trade in the national
marketplace." " (Citation omitted.)
The Court continued that state laws regulating cyber porm
"currently impose a much greater burden on out-of-state
businesses providing adult material on the Internet than state
laws regulating real-space pormography impose on out-of-state
adult magazine publishers and other real-space pormography
providers. ... Thus, to avoid prosecution, an adult Web site
operator must comply with the most restrictive state obscenity
regulations if it is to make its content available on the Web
at all. In contrast, purveyors of real-space pormography can
choose to comply with the regulations of only those states to
which they affirmatively distribute. This leads the court to
conclude that, due to the current status of geographic
filtering technology on the Internet, section 18.2-391
violates the Commerce Clause."
|10/21. The moratorium on new and discriminatory Internet
taxes contained in the Internet Tax Freedom Act expired.
10/18. Sen. Mike Enzi
(R-WY) and others introduced S
1567, the Internet Tax Moratorium and Equity Act.
filed a complaint in U.S.
District Court (NDCal) against Adobe Systems alleging patent
infringement. (D.C. No. 01-03940 SI.)
|GAO Reports on Information
Sharing and Cyber Attacks
|10/19. The GAO
released a report
[PDF] titled "Information Sharing: Practices That Can
Benefit Critical Infrastructure Protection."
GAO studied 11 organization to determine information sharing
practices related to protection of critical information
infrastructure. The organizations were The Agora, CDC,
CERT/CC, Federal Computer Incident Response Center,
International Information Integrity Institute, InfraGard,
Joint Task Force -- Computer Network Operations, National
Coordinating Center for Telecommunications, Network Security
Information Exchanges, N.Y. Electronic Crimes Task Force, and
the North American Electric Reliability Council.
The report states that "Information sharing and
coordination are key elements in developing comprehensive and
practical approaches to defending against computer based, or
cyber, attacks, which could threaten the national welfare.
Such attacks could severely disrupt computer supported
operations, compromise the confidentiality of sensitive
information, and diminish the integrity of critical
data." The report continues that "The importance of
sharing information and coordinating the response to cyber
threats among various stakeholders has increased as our
government and our nation have become ever more reliant on
interconnected computer systems to support critical operations
and infrastructures, such as telecommunications, power
distribution, financial services, national defense, and
critical government operations."
One of the challenges identified by the report is
"overcoming new members’ initial reluctance to share
information." The report elaborated that "All of the
participating organizations told us that initially
establishing trust among the original members was a challenge.
This was because members were reluctant to share their
organization’s problems and vulnerabilities with outsiders,
some of whom were commercial competitors."
The report was prepared for Sen. Robert Bennett
(R-UT). Sen. Bennett and Sen.
Jon Kyl (R-AZ) are cosponsors of S 1456,
the Critical Infrastructure Information Security Act of 2001.
One of the main purposes of the bill is to encourage
information sharing pertaining to cyber security issues, by
removing legal disincentives for such actions. The bill would
provide a Freedom of Information Act exemption for
certain cyber security information provided to certain federal
agencies, including the NIPC, FCC, Justice
Department, Defense Department, and Commerce Department. The
bill would also provide an antitrust exemption for
certain collaboration on cyber security issues.
The report also concluded that "All of the organizations
identified trust as the essential underlying element to
successful relationships and said that trust could be built
only over time and, primarily, through personal
relationships." The report identified three
"critical success factors": secure communication
mechanisms, support of senior managers, and organization
leadership continuity. The report also identified four
"challenges": developing agreements on the use and
protection of shared information, obtaining adequate funding,
maintaining a focus on emerging issues, and maintaining
professional and administrative staff with appropriate skills.
|3rd Circuit Affirms in
Check Point Trademark Case
|10/19. The U.S.
Court of Appeals (3rdCir) issued its opinion
Systems v. Check Point Software, a trademark
Systems makes electronic security control systems that
track the physical location of goods, including electronic
article surveillance systems, access control systems, closed
circuit television systems, and radio frequency identification
devices. It registered the "CHECKPOINT" mark with
the United States Trademark Office. Check Point Software
Technologies makes firewall software products. Checkpoint
Systems filed a complaint in U.S. District Court against Check
Point Software Technologies alleging trademark infringement
and unfair competition in violation of the Lanham Act. The
District Court found no likelihood of confusion, and thus,
held for the defendant on both counts. The Court of Appeals
|10/16. The Internet Security Alliance picked John Thomas
to be its Director of Strategic Initiatives. The Internet
Security Alliance is a collaborative effort between Carnegie
Mellon University’s Software Engineering Institute (SEI) and
its CERT Coordination Center
and the Electronics Industries
Alliance (EIA). See, EIA
10/13. The law firm of Fenwick
& West elected new partners, including Stephen
Hixson, and John
Ryan. Gillespie works in the firm's Intellectual
Property Group, focusing on technology licensing and Internet
commerce counseling. Angus works in the firm's Corporate
Group, concentrating on advising start up and venture backed
companies, equity and debt financings, mergers and
acquisitions and strategic and joint venture transactions.
Hixson works in the Employment and Labor Law Group. Ryan works
in the Tax Group. See, F&W
10/18. Six attorneys who practice in the areas of intellectual
property and litigation joined the Minneapolis office of the
law firm of Fulbright
& Jaworski. The six are Alan Anderson, Ronn
Kreps, Christopher Larus, Renee Jackson, John
Klos, and Sharna Wahlgren. See, release.
10/15. Brent Slosky joined the Denver office of the law
firm of Hogan & Hartson
as a partner. He previously worked at the law firm of Brownstein Hyatt & Farber
in Denver. His practice focuses on corporate transactions,
with an emphasis on private capital formation and the
structuring and financing of mergers and acquisitions,
including for Internet based telecommunications businesses and
Internet service satellite companies. See, release.
10/17. The law firm of Latham
& Watkins named Charles
Nathan Co-Chair of its firmwide M&A Practice
Group. See, release.
|Monday, Oct 22
|Neither the House nor the Senate is in session.
1:00 - 2:30 PM. The Electronic
Privacy Information Center (EPIC) and the Privacy
Foundation will sponsor a panel discussion on the implications
of new systems for identification and tracking on personal privacy.
The speakers will be Richard Smith (Privacy Foundation),
Robert Smith (Privacy Journal), Jeffrey Rosen (New Republic),
John Woodward (RAND), and Whitfield Diffie (Sun Microsystems).
Marc Rotenberg (EPIC) will moderate. For more information
contact Sarah Andrews at 202 483-1140. Location: National Press Club, 529 14th
Street, NW, Washington DC.
|Tuesday, Oct 23
|The Senate is scheduled to reconvene at 9:30 AM. The House
is scheduled to reconvene at 12:30 PM.
10:00 AM. FCC Chairman Michael Powell
will hold an informal press conference with reporters who
cover the FCC. Location: FCC Meeting Room, 12th Street Level,
445 12th Street SW, Washington DC.
|Wednesday, Oct 24
|10:00 AM. The House
Commerce Committee's Subcommittee on Commerce, Trade, and
Consumer Protection will hold a hearing titled
"Challenges Facing the Federal Trade Commission."
FTC Chairman Timothy Muris will be the only witness.
Location: Room 2123, Rayburn Building.
10:00 AM - 12:00 NOON. The FCC will hold a public forum on the
Commission Registration System (CORES) and FCC Registration
Number. Location: FCC, 445 12th Street, SW, Commission Meeting
Room, Washington DC.
2:00 PM. The Senate
Judiciary Committee's Subcommittee on Technology,
Terrorism and Government Information will hold a hearing
titled "The World's Most Wanted Terrorists - Who Are They
and What Do They Want?" Sen. Diane Feinstein
(D-CA) will preside. Location: Room 226, Dirksen Building.
2:30 - 4:30 PM. Roe Hemenway, Manager of Optical Network
Equipment Research at Corning's Sullivan Park research
facility, will give a presentation on optical fiber
communications. See, FCC
release. Location: Commission Meeting Room, TW-C305, FCC,
445 12th Street, SW, Washington DC.
Deadline for submitting public comments to the FTC's
Bureau of Competition regarding AOL Time Warner's requests for
approval of two alternative cable broadband ISPs. On September
26 and 24, AOLTW submitted two motions to the FTC titled
"Motion for Approval of Non Affiliated ISP and
Alternative Cable Broadband ISP Service Agreement". AOLTW
is required, pursuant to ¶ II.A.2 of the FTC's Decision and
Order [PDF] approving the merger of AOL and Time Warner,
dated April 17, 2001, to enter into such agreements, and
obtain FTC approval. The FTC published a redacted
version of the motion [PDF] regarding AOLTW's agreement
with Internet Junction Corp.
and a redacted
version of the motion [PDF] regarding AOLTW's agreement
with New York Connect.Net, Ltd.
|Thursday, Oct 25
|8:30 - 10:00 AM. Harold Furchtgott-Roth
and others will hold an informal discussion titled "The
Telecommunications Sector in a Slowing Economy". RSVP to
Veronique Rodman at 202 862-4871 or email@example.com. Location: American Enterprise Institute,
1150 17th Street, NW, 11th Floor Conference Room, Washington
9:30 AM. The Senate
Commerce Committee will hold a hearing to examine
promoting broadband, focusing on securing content and
accelerating transition to digital television.
Location: Room 253, Russell Building.
9:30 AM. The House
Commerce Committee's Subcommittee on Telecommunications
and the Internet will hold a legislative hearing on HR
2417, the Dot Kids Domain Name Act of 2001.
Location: Room 2123, Rayburn Building.
10:00 AM. The Senate
Judiciary Committee might hold an executive business
meeting. Room 226, Dirksen Building.
12:15 PM. The Federal
Communications Bar Association's (FCBA) Common Carrier
Committee will host a brown bag lunch. The speakers will be Tamara
Preiss, Blair Levin, and Jonathan Askin. The
topic will be "Perspectives on Local Competition and
Local Competitors". RSVP to Naja Wheeler. Location: Wiley Rein & Fielding, 1750
K Street, 10th Floor, Washington DC.
Deadline to reply submit comments to the FCC in its rule making
proceeding regarding locating spectrum bands below 3 Ghz for
possible reallocation for Third Generation (3G)
wireless services, and for other purposes. (ET Docket Nos.
00-258 and 95-18 and IB Docket No. 99-81.) See, notice
in Federal Register, September 13, 2001, Vol. 66, No. 178, at
Pages 47618 - 47621.
Deadline to submit reply comments to the FCC in its rule making
proceeding regarding permitting Mobile Satellite Service (MSS)
operators flexibility to use their spectrum for land based
transmitters. (IB Docket No. 01-185, ET Docket No. 95-18.)
in Federal Register, September 13, 2001, Vol. 66, No. 178, at
Pages 47621 - 47625.
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