Tech Law Journal Daily E-Mail Alert
February 14, 2002, 9:00 AM ET, Alert No. 368.
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Rep. Goodlatte Introduces Bill to Exempt ISPs from Criminal Liability
2/12. Rep. Bob Goodlatte (R-VA) introduced HR 3716, the "Online Criminal Liability Standardization Act of 2002", a bill that would exempt ISPs from criminal liability for third party content stored on their servers.
The bill provides that "no interactive computer service provider, or corporate officer of such provider, shall be liable for an offense against the United States arising from such provider’s transmitting, storing, distributing, or otherwise making available, in the ordinary course of its business activities as an interactive computer service provider, material provided by another person." The bill further provides that "The liability limitation created by this section does not apply if the defendant intended that the service be used in the commission of the offense."
Rep. Goodlatte also issued a release which stated that "Currently, Internet Service Providers are generally protected from civil liability under federal and state law for content on the Internet posted by a third party." See, 47 U.S.C. § 230, which provides, in part, that "No provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider."
Rep. Goodlatte continued: "However, ISPs may face criminal charges in a number of instances if one of their employees has knowledge or reason to know of illegal activities occurring across the service provider's system, regardless of whether the service provider has criminal intent and can prevent the illegal activity.  In some cases, criminal liability can occur even if the employee is simply aware that an activity is occurring on the system, without being aware that the activity is illegal."
He cited the example of BuffNET, an ISP in New York, that was investigated and charged in connection with pormographic content posted to a bulletin board by third parties.
Rep. Goodlatte addressed his bill at the February 12 hearing of the House Judiciary Committee's Crime Subcommittee on HR 3482, the "Cyber Security Enhancement Act of 2001". He suggested that HR 3716 be made a part of HR 3482, which is scheduled for subcommittee mark up on February 14.
At that hearing, Clint Smith, who testified on behalf of the U.S. Internet Service Providers Association, said that Rep. Goodlatte's bill "would appear to be a great benefit to the ISP community." Smith added that it would also enhance cyber security by fostering greater cooperation among law enforcement agencies and ISPs. Smith stated that "an impediment to cooperation is ISP concern about liability", and that "clarity in the legal framework will enhance cooperation".
Netscape v. Microsoft is a Brouhaha, Not a Tussle
2/13. The U.S. Court of Appeals (7thCir) issued its opinion in 42nd Parallel North v. E Street Denim, an antitrust case. The Appeals Court affirmed the dismissal of a private antitrust action brought by one local retailer against another. In so doing, the Appeals Court referenced the antitrust complaint filed by Netscape against Microsoft last month.
"The Microsoft/ Netscape (Netscape's corporate parent is AOL Time Warner) brouhaha is the sort of battle one thinks about when considering lawsuits under federal antitrust laws. One does not ordinarily conjure up the same sort of images when thinking about two little retail stores in suburban Chicago duking it out over blue jeans and T-shirts. But that's what we've got before us on this appeal. The district judge thought that the tussle didn't measure up as an antitrust suit and he dismissed it. As we see it, the district judge got it right, and his dismissal of the suit is affirmed."
House Science Committee Holds Hearing on R&D Budget
2/13. The House Science Committee held a hearing titled "R&D Budget for Fiscal Year 2003: An Evaluation".
Rep. Sherwood Boehlert (R-NY), the Chairman of the Committee, said in his opening statement that "Even a casual glance at the budget makes clear what the R&D priorities are -- biomedical research and the fight against terrorism at home and abroad. These are reasonable -- even self-evident -- priorities and they deserve to be funded more generously than are other programs. That's what it means to be a budget priority. But I'm concerned that the proposed budget treats these items not just as priorities, but as panaceas. And that, I fear, is a mistake."
See also, prepared statement of witnesses: John Marburger (Director, Office of Science and Technology Policy), Rita Colwell (Director, National Science Foundation), Samuel Bodman (Deputy Secretary, Department of Commerce), and Bruce Carnes (Department of Energy).
More News
2/13. The National Telecommunications and Information Administration (NTIA) published in its web site a copy of Amendment 1 to the contract with NeuStar for management of the .us ccTLD.
2/13. World Trade Organization (WTO) Director General Mike Moore submitted a progress report to the WTO's General Council regarding implementation of the Doha Development Agenda.
2/12. The Department of Justice's Antitrust Division filed its reply comments [28 pages in PDF] with the Federal Communications Commission (FCC) in its proceeding titled "In the Matter of Performance Measurements and Standards for Unbundled Network Elements and Interconnection". It wrote that "The adoption of a national model for performance measurement has potential benefits. If the Commission decides to adopt a national model, however, it should take care to build on the continuing state efforts and ensure that it does not undermine the progress already made in developing and enforcing performance measures and standards. A national model should not preempt existing state measurement schemes or remedy plans. In addition, the list of performance measures in a model must be broad enough to include all measures that are necessary and appropriate to ensure the continued availability of data needed to promote the opening of local telecommunications markets, to maintain its openness once achieved, and thus to secure the benefits of local competition for all consumers." This is CC Docket No. 01-318.
SEC to Require Publication of SEC Filings in Company Web Sites
2/13. The Securities and Exchange Commission (SEC) announced that it intends to propose changes in corporate disclosure rules to improve the financial reporting and disclosure system. The SEC listed several changes, including requiring public companies to publish their SEC filings in their web sites.
The SEC stated in a release that "The Commission believes that mandated public company disclosure should be more readily available to investors in a variety of locations. To further this goal, the Commission intends to propose amendments that would require public companies to make their Exchange Act reports available on their Internet web sites, if available, at the same time as they are filed. This requirement would not in any way replace or reduce a company’s obligation to file with the Commission."
U.S. Files Complaint with WTO Re Telecommunications in Mexico
2/13. The Office of the U.S. Trade Representative (USTR) announced that the U.S. asked the World Trade Organization (WTO) for a dispute settlement panel to rule on a U.S. complaint that Mexico has failed to open its cross border telecommunications market as required under WTO rules.
USTR Robert Zoellick stated in a release that "Mexico's international telecommunications market remains dominated by a single company with a government mandate to set high wholesale prices for calls to Mexico and prevent competitive alternatives".
AT&T General Counsel James Ciconni stated in a release that "The U.S. government is serving notice to Mexico -- and other trading partners -- that ignoring pro-competitive trade commitments won't be tolerated. That's just what Mexico has been doing for many years now: ignoring its WTO telecom commitments and hoping its trading partners would go away. For instance, despite its 1998 commitment, Mexico still charges unreasonably high fees for sending traffic between the U.S. and Mexico, causing U.S. carriers to pay rates that are five times more than those for completing calls into Canada and other competitive countries. The high Mexican rates are an outrage, costing U.S. consumers and businesses well over half a billion dollars per year."
Rep. Crane Addresses Trade, FSC and Taxes
2/13. The Cato Institute hosted a panel discussion titled "Trade War or Tax Reform? The WTO Ruling on Tax Breaks for U.S. Exporters". Rep. Phil Crane (R-IL), Chairman of the Trade Subcommittee of the House Ways and Means Committee, spoke at the event. The solution, said Rep. Crane, is for the U.S. to abolish the corporate income tax altogether.
The U.S.'s Foreign Sales Corporation (FSC) tax scheme, which the World Trade Organization (WTO) has held to be an illegal export subsidy, allows a portion of a U.S. taxpaying firm's foreign source income to be exempt from U.S. income tax. This benefits major software companies, such as Microsoft, and equipment makers, such as Cisco and Motorola.
Most nations have a territorial tax regime, by which they tax the income of corporations within their territory. The U.S., in contrast, has a global tax regime dating back to the 19th Century. American corporations are taxed by the United States government for their domestic and foreign income. That is, under the basic rules, if an American corporation sells its products in France, the U.S. taxes the income. However, if a French corporation sells its products in the U.S., France does not the income of the corporation operating in the U.S.
U.S. exporters, and their many supporters in Congress and the administration, argue that this is simply leveling the playing field between U.S. and European companies. The EU contends that by giving tax breaks to U.S. exporters, the U.S. is, in effect, subsidizing exports, in violation of its trade agreements.
Rep. Crane stated that abolishing the corporate income tax would eliminate the U.S.'s WTO FSC problems. It would also provide an economic stimulus. He stated that many European corporations would relocate in the U.S., to take advantage of the U.S. tax laws. However, he also stated that abolishing the corporate income tax may not be political viable. He suggested as an alternate switching to a territorial tax system.
The other speakers at the event were William Reinsch (National Foreign Trade Council), John Meagher (Price Waterhouse Coopers), and Chris Edwards (Cato Institute).
USTR Announces Out of Cycle 301 Reviews
2/12. The Office of the U.S. Trade Representative (USTR) announced the outcome of "out-of-cycle" reviews for the adequacy and effectiveness of intellectual property protection in the Bahamas and Slovenia. It placed The Bahamas on the Watch List for its failure to improve its laws protecting copyrighted material. However, it kept Slovenia off of the Watch List. See, USTR release.
Privacy News
2/13. The Electronic Privacy Information Center (EPIC) submitted a series of Freedom of Information Act (FOIA) requests to the FBI, Department of Defense, other federal agencies and the District of Columbia requesting records pertaining to video surveillance in Washington DC. See, EPIC release.
2/13. The Electronic Privacy Information Center (EPIC) released a report [PDF] titled "Your Papers, Please: From the State Drivers License to a National Identification System." The report opposes "recommendations that would turn the state driver license into a de facto national ID card." See also, American Association of Motor Vehicle Administrators release of January 14, 2002.
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Thursday, Feb 14
Day two of a three day conference titled Biometric Consortium Conference. See, conference web site. Location: Hyatt Regency Crystal City, Arlington, VA.
9:30 AM. The FCC will hold a meeting. See, FCC release. Location: FCC, Room TW-C305, 445 12th St., SW.
9:30 AM. The House Commerce Committee's Subcommittee on Commerce, Trade, and Consumer Protection will hold a hearing titled "Are Current Financial Accounting Standards Protecting Investors?" Location: Room 2212, Rayburn Building.
10:00 AM. The House Judiciary Committee's Subcommittee on Courts, Internet and Intellectual Property will hold a hearing on the "Federal Trademark Dilution Act." Location: Room 2141, Rayburn Building.
11:00 AM. The FTC will hold a press availability on the FTC's "latest law enforcement action against companies that mislead consumers with "free" entertainment service ads". Howard Beales, Director of the FTC's Bureau of Consumer Protection, will speak. Reporters unable to attend can dial in at 1-800- 298-9646; the chairperson is Bruce Jennings; and the confirmation #11340723. See, FCC release. Location: Room 481, 600 Pennsylvania Avenue, NW.
1:30 PM. The House House Judiciary Committee's Crime Subcommittee will mark up HR 3482, the "Cyber Security Enhancement Act of 2001", sponsored by Rep. Lamar Smith (R-TX). Location: Room 2237, Rayburn Building.
12:15 - 2:00 PM. The Forum on Technology and Innovation (Tech Forum) will hold a event relating to cyber security. The speakers will be Richard Clarke (Special Advisor to the President for Cyberspace Security), Vint Cerf (WorldCom), and Bruce Schneier (CTO of Counterpane Internet Security). The Tech Forum was founded by Sen. Bill Frist (R-TN), Sen. Jay Rockefeller (D-WV), and the Council on Competitiveness. Location: Room SC-5, U.S. Capitol Building.
2:30 PM. The Senate Judiciary Committee's Technology, Terrorism, and Government Information Subcommittee will hold a hearing on privacy, identity theft, and protection of personal information. Sen. Dianne Feinstein (D-CA) will preside. The witnesses will be Sen. Judd Gregg (R-NH), Richard Stana (GAO), Susan Fisher (Doris Tate Crime Victim's Bureau), Doug Comer (Intel), John Avila (Walt Disney Company), Frank Torres (Consumers Union). Location: Room 226, Dirksen Building.
Friday, Feb 15
The House will not be in session.
Day three of a three day conference titled Biometric Consortium Conference. See, conference web site. Location: Hyatt Regency Crystal City, Arlington, VA.
8:00 AM - 2:00 PM. The NSF's Advisory Committee for Cyberinfrastructure will hold an open meeting. See, notice in Federal Register. Location: Room 1150, NSF, 4201 Wilson Blvd., Arlington, VA.
9:30 AM. The U.S. Court of Appeals (DCCir) will hear oral argument in New World Radio v. FCC, No. 1110. Judges Henderson, Randolph and Rogers will preside.
12:00 NOON. Deadline to submit comments to the Office of the USTR regarding foreign countries that deny adequate and effective protection of intellectual property rights or deny fair and equitable market access to U.S. persons who rely on intellectual property protection. The USTR requests comments pursuant to its duties under § 182 of the Trade Act of 1974, 19 U.S.C. § 2242, which is better known as the "Special 301" provisions. See, notice in the Federal Register.
Extended deadline to file reply comments with the FCC in its proceeding regarding cross ownership of broadcast stations and newspapers. This is MM Docket No. 01-235. See, notice in Federal Register.
Monday, Feb 18
Presidents' Day. The FCC will be closed. The House will be in recess on February 18 through 22.
Tuesday, Feb 19
4:00 PM. Deadline to submit grant applications to the Department of Labor's Employment and Training Administration for funds for skills training programs. These grants are financed by user fees paid by employers in the H-1B visa program. See, notice in Federal Register. This notice changes a deadline of February 12 contained in a previous notice.
Extended deadline to submit reply comments to the FCC in response to its Further Notice of Proposed Rulemaking regarding its cable horizontal and vertical ownership limits. See, original notice [PDF] in Federal Register of October 11, 2001, and extension Order [PDF] of January 29, 2002. The NCTA requested the extension.
Deadline to submit comments to the FTC regarding its proposed settlement with Eli Lilly (which accidentally disclosed the e-mail addresses of 669 subscribers to a Prozac e-mail list). The proposed settlement requires Eli Lilly to establish a security program. See, notice.
Deadline to submit comments to the Federal Communications Commission (FCC) in the matter of Ambient's application for a determination that it is an exempt telecommunications company. It is an electric power company that also provides broadband Internet access and related information services over power lines to electrical outlets in residences. See, FCC release [PDF].
Wednesday, Feb 20
9:00 AM - 4:30 PM. The FTC and the Antitrust Division of the Department of Justice (DOJ) will hold the third in a series of joint hearings on antitrust and intellectual property. There will be two sessions (9:00 AM - 12:30 PM and 2:00 - 4:30 PM) titled "Economic Perspectives on Intellectual Property, Competition and Innovation". See, FTC release and DOJ release. Location: Room 432, FTC, 600 Pennsylvania Ave., NW.
8:00 AM - 6:00 PM. The Federal Communications Bar Association (FCBA) and Georgetown University Law Center (GULC) will co-host a CLE program titled "FCC Speaks". FCC Chairman Michael Powell will speak on "The Path to the Digital Broadband Migration" at 8:30 AM. FCC Commissioners Abernathy, Copps, and Martin will participate in a panel discussion at 4:20 PM. The program will also include panels titled "National Broadband Policy", "Competition Policy Panel", "Spectrum Allocation Policy", "Media Ownership Working Group", "Digital Television Task Force", and "Homeland Security Council". See, full schedule. The price to attend is $795, $745 (GULC alumni), $695 (FCBA members), $595 (government employees). Location: GULC, Moot Courtroom, 600 New Jersey Ave., NW.