Tech Law Journal Daily E-Mail Alert
January 8, 2002, 9:00 AM ET, Alert No. 341.
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Sen. Daschle Addresses Tech Issues
1/4. Sen. Tom Daschle (D-SD), the Senate Majority Leader, gave a speech on the economy in which he addressed several technology related issues. He advocated passage of legislation that would create tax credits for broadband service, grant the President trade promotion authority, make the R&D tax credit permanent, and double civilian R&D funding. He stated that "By embracing fiscal discipline, investing in people and technology, and opening up new markets abroad, we helped lay a foundation for a new growth economy."
Broadband Tax Credits. Sen. Daschle stated that "High speed, broadband Internet access has become an indispensable tool for businesses, schools, libraries, and hospitals. And access to this service is fast becoming the line between the haves and have nots in the information age. We should create tax credits, grants, and loans to make broadband service as universal tomorrow as telephone access is today." He did not reference any specific bills. However, Sen. Daschle is a sponsor of S 88, the Broadband Internet Access Act of 2001. This bill, which was introduced by Sen. Jay Rockefeller (D-WV) on January 22, 2001, is sponsored by 66 Senators.
Trade Promotion Authority. Sen. Daschle stated that he supports trade promotion authority, which is also called TPA and fast track. TPA gives the President authority to negotiate trade agreements which can only be voted up or down, but not amended, by the Congress. TPA strengthens the bargaining position of the President, and the U.S. Trade Representative (USTR), in trade negotiations with other nations.
Sen. Daschle stated that "we must open new markets and help workers who are hurt by trade. No country is better situated to thrive in this global information economy than the United States of America. That is why I support fast track and intend to bring it up for a vote in the full Senate early this year. In the Finance Committee, we passed a bill that addresses critical labor and environmental issues."
The House passed its version of the TPA bill, HR 3005, the Bipartisan Trade Promotion Authority Act of 2001, by a roll call vote of 215 to 214 on December 6, 2001. See, TLJ Daily E-Mail Alert No. 323.
However, Sen. Daschle added that "we need to recognize that not everyone benefits. Some workers are displaced. ... That is why, as part of our consideration of fast track, Senate Democrats are proposing to expand Trade Adjustment Assistance. We believe that we should expand assistance to all workers who are hurt by global production shifts."
R&D Tax Credit. He stated that "we should act to make the research and development tax credit permanent -- the sooner, the better." For decades, the Congress has passed a series of short term extensions of this tax credit. Sen. Daschle added that "the R&D tax credit is one of the most effective mechanisms to encourage innovation, increase business investment and keep the economy growing."
R&D Funding. Sen. Daschle stated that "Over the past century, federal investments in research have helped split the atom, sequence the genome, invent the microchip, the laser, and the Internet ... and helped create millions of jobs. In this century, nanotechnology, robotics, advanced energy technologies like fuel cells and solid state lighting, and biotechnologies like gene therapy, have the potential to do the same. We should double civilian R&D funding, including funding for the National Science Foundation. And we should fully fund the Advanced Technology Program -- to speed these innovations to market." He also said that "Expanded investments in areas such as physics, computer science, mathematics, and electrical engineering -- are essential to maintaining America's economic and technological leadership in the 21st century."
USTR Zoellick Praises Daschle Statements on TPA
1/7. The U.S. Trade Representative (USTR), Robert Zoellick, who is pushing the Congress to grant the President trade promotion authority, praised Sen. Tom Daschle's (D-SD) January 4 speech. Daschle said "I support fast track and intend to bring it up for a vote in the full Senate early this year."
Zoellick stated in a release that "I'm pleased to see that Senate Majority Leader Daschle has established a high priority for prompt Senate approval of Trade Promotion Authority."
Zoellick continued that "Majority Leader Daschle has called for inclusion of measures such as Trade Adjustment Assistance. The Administration recognizes that effective adjustment assistance must be a key component of America's trade strategy. I look forward to working constructively with the Senate Leadership on Trade Promotion Authority to ensure a vote on the Senate floor early in the new session."
Supreme Court Denies Cert in Surveillance Camera Case
1/7. The Supreme Court denied certiorari in Consolidated Freightways v. Cramer, thereby letting stand an Appeals Court opinion which reversed a District Court dismissal of a privacy action. See, January 7 Order List [PDF].
Facts. Consolidated Freightways (CF), a trucking company, installed hidden cameras and microphones in employee bathrooms, in violation of the California criminal code.
Trial Court. Employees and others filed two complaints in California Superior Court alleging violation of privacy based upon state law. CF removed both cases to the U.S. District Court (CDCal), where they were consolidated. CF argued that  301 of the Labor Management Relations Act (LMRA) preempted the state law action because the plaintiffs were subject to a collective bargaining agreement (CBA). The trial court dismissed as to all plaintiffs, except those who were not employees of CF.
Appeals Court. The U.S. Court of Appeals (9thCir) issued an en banc opinion [PDF] on June 15, 2001, reversing the District Court. It held that since the CBA did not cover privacy claims, there could be no preemption. However, the Court continued that "when an employer's surreptitious surveillance constitutes a per se violation of established state privacy laws, the employees affected thereby may bring an action for invasion of privacy regardless of the terms of the collective bargaining agreement governing their employment."
Supreme Court Denies Cert in Reciprocal Compensation Case
1/7. The Supreme Court denied certiorari in Global Naps v. FCC, a case regarding reciprocal compensation for ISP bound traffic. See, January 7 Order List [PDF] at page 3.
On February 20, 2001, the U.S. Court of Appeals (DC Cir) issued its opinion upholding a Federal Communications Commission (FCC) Memorandum Opinion and Order (FCC 99-381) regarding reciprocal compensation for Internet Service Provider (ISP) bound traffic. Global Naps is a competitive local exchange carrier (CLEC) that provides phone service in Massachusetts. Bell Atlantic (now Verizon) filed a complaint with the FCC alleging illegal tariffs by Global Naps. The FCC released its order on Dec. 2, 1999, which ruled the tariff to be illegal. Global Naps then filed a Petition for Review with the Court of Appeals. The Appeals Court denied the petition and upheld the order. The Supreme Court's denial of certiorari lets stand the Appeals Court's ruling, and the FCC Order. 
SEC Shuts Down 17 Year Old's Internet Stock Fraud Operation
1/7. The Securities and Exchange Commission (SEC) filed its original civil complaint in U.S. District Court (SDNY) against Invest Better 2001 and John Does 1 through 10 on December 13, 2001, alleging the unregistered and fraudulent sale of securities over the Internet. At that time, the SEC did not know the identity of the principals behind the operation. See, Dec 13 release. On January 7, the SEC identified Cole Bartiromo, a 17 year old resident of Mission Viejo, California, as a principal in Invest Better 2001 (IB2001).
The SEC filed an amended complaint naming Bartiromo. Also, the District Court issued a partial final judgment and order, on consent, which permanently enjoins Bartiromo and IB2001, directs the return of funds obtained from investors, freezes Bartiromo's and IB2001's assets, directs Bartiromo and IB2001 to provide an accounting, and grants other relief. See, January 7 release.
Bartiromo used a web site and MSN bulletin board to offer securities at guaranteed exorbitant returns on short term investments. The SEC announced that it has located $900,000 in ill gotten gains. The Director of the SEC's Enforcement Division, Stephen Cutler, stated in a release that "just about anyone -- even a 17 year old high school student -- can mastermind a securities fraud over the Internet."
Fed Circuit Vacates Sanctions Order in Patent Infringement Action
1/7. The U.S. Court of Appeals (FedCir) issued its opinion in Antonious and Finnegan Henderson v. Spalding, reversing a District Court award of sanctions against the law firm of Finnegan Henderson (FH).
FH is a large law firm specializing in intellectual property law. It was the attorney for Anthony Antonious in a patent infringement action. Antonious filed a complaint (prepared by FH) in U.S. District Court (DMd) against Spalding alleging infringement of a patent pertaining to golf club design. The District Court granted defendants' motions for summary judgment. Spalding also sought sanctions under FRCP 11(c) against both Antonious and FH for failure to conduct a reasonable prefiling factual investigation. The District Court awarded sanctions. The Appeals Court vacated the sanctions order.
Court Denies Microsoft's Request for Trial Delay
1/7. The U.S. District Court (DC), Judge Colleen Kotelly presiding, denied Microsoft' motion to amend the scheduling order (to delay the trial date) in the government antitrust lawsuit. Nine of the state plaintiffs have not joined in the settlement agreement negotiated by Microsoft, the Department of Justice, and the other state plaintiffs.
Tuesday, Jan 8
The Supreme Court will hear oral argument in Festo Corporation v. Shoketsu Kinzoku Koygo Kabushiki, No. 00-1543, a case regarding the doctrine of equivalents in patent law.
7:00 AM - 5:15 PM. Day two of the Future of Music Coalition conference. Location: Gaston Hall, Georgetown University, 37th and O Streets, NW.
9:00 - 9:30 AM. Rep. John Conyers (D-MI), the ranking Democrat on the House Judiciary Committee, will deliver a keynote address at the Future of Music Coalition conference.
Wednesday, Jan 9
10:00 AM. The U.S. Court of Appeals (FedCir) will hear oral argument in Fantasy Sports v., No. 01-1217, an appeal from the U.S. District Court (EDVa). This is a patent infringement case regarding U.S. Patent 4,918,603, titled "Computerized Statistical Football Game". (D.C. No. 99 CV 2131103; opinion at F. Supp. 2d 886 (E.D.Va. 2000).) Location: Courtroom 402, 717 Madison Place, NW.
10:00 AM. The U.S. Court of Appeals (FedCir) will hear oral argument in ManTech Telecommunications v. US, No. 01-5090. Location: Courtroom 402, 717 Madison Place, NW.
12:15 PM. The FCBA's Telecom Competition Issues Committee will host a brown bag lunch. Michael Katz, a Deputy Assistant Attorney General for the DOJ's Antitrust Division, and former Chief Economist of the FCC, will speak about his observations on the similarities and differences that characterize the two agencies' approach to competition issues. Location: CTIA, 1250 Connecticut Ave., NW, 8th floor conference room.
12:15 PM. The FCBA's Online Communications Committee will host a brown bag lunch. Bruce Mehlman, Assistant Secretary of Commerce for Technology Policy, will give a talk titled "Broadband, When? A View from the Administration." RSVP to Scott Harris. Location: Lampert & O'Connor, 5th floor, 1750 K St., NW.
People and Appointments
1/7. Mary Jo White stepped down as the U.S. Attorney for the Southern District of New York. The incoming USA, James Comey, was sworn in as her replacement. However, he has yet to be confirmed by the Senate.
1/7. Bob Biersack was named Deputy Press Officer at the Federal Election Commission (FEC). He replaces Sharon Snyder, who retired. Biersack has been in the Data Systems Development Division (DSDD) at the FEC since 1983, specializing in analysis and web posting of campaign finance data. He has also worked on the design and implementation of the FEC's electronic filing program and Internet accessible database. See, FEC release.
1/7. BT Group announced the appointment of three new directors to its board: John Nelson (retiring chairman of Credit Suisse First Boston (Europe) Ltd), Carl Symon (former senior executive with the IBM), and Margaret Jay. Helen Alexander, June de Moller, John Weston, and Neville Isdell will retire from the board. See, BT release.
More News
1/7. The Supreme Court denied certiorari in Tacoma v. Qwest, No. 01-596. See, January 7 Order List [PDF] at page 3.
1/7. USinternetworking Inc. filed a Chapter 11 bankruptcy petition in U.S. Bankruptcy Court (DMd). The Annapolis, Maryland, based company sells iMAP services. See, USI release.
1/7. The FBI's National Infrastructure Protection Center (NIPC) published in its web site a copy of its CyberNotes: 2001 Year End Summary [84 pages in PDF].
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