Tech Law Journal Daily E-Mail Alert
February 25, 2002, 9:00 AM ET, Alert No. 375.
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Cal App Rules on Employer's Access to Employer Provided Home PC of Employee
2/22. The Court of Appeal of California (2/1) issued its opinion [PDF] in TBG v. Zieminski, a wrongful termination case involving the issue of pre-trial production of a computer hard drive. The Court of Appeal reversed a trial court order denying an employer's motion to compel production of a home computer in a wrongful termination case, where the alleged misuse of computers was the basis for the termination.
Background. Robert Zieminski was a senior executive at TBG Insurance Services Corporation. TBG provided him with two computers -- one for use at work, and the other for use at home. Zieminski signed an agreement that provided that he would use the PCs "for business purposes only and not for personal benefit or non-Company purposes, unless such use [was] expressly approved. Under no circumstances [could the] equipment or systems be used for improper, derogatory, defamatory, obscene or other inappropriate purposes."
Zieminski also consented to have his computer "use monitored by authorized company personnel" on an "as needed" basis, and agreed that communications transmitted by computer were not private. TBG terminated Zieminski -- three days before a large block of stock options were to vest -- alleging that he "had violated TBG's electronic policies by repeatedly accessing pormographic sites on the Internet while he was at work."
Trial Court. Zieminski filed a complaint against TBG in Superior Court for Los Angeles County, California, alleging wrongful termination. He alleged that improper computer use was a pretext for preventing him from exercising stock options. TBG demanded return of the home PC. Zieminski refused, citing a right to privacy found in the California Constitution. TBG filed a motion to compel production of the home computer. The trial court denied TBG's request, although, not on privacy grounds. It wrote that the evidence on the home PC would be "merely corroborative of facts already in [TBG's] possession; since [TBG] already has extensive evidence, any additional evidence that the [home computer] may disclose does not outweigh the fact that the computer contains personal information." This appeal followed.
Court of Appeal. The Court of Appeal reversed and remanded. The Court first rejected the trial court's rationale. It cited the basic discovery rule that a "party may obtain discovery regarding any matter, not privileged, that is relevant to the subject matter involved in the pending action . . . if the matter either is itself admissible in evidence or appears reasonably calculated to lead to the discovery of admissible evidence." (See, Calif. Code Civ. Proc. 2017.) The Court then concluded that "the home computer is indisputably relevant (Zieminski does not seriously contend otherwise), and the trial court's finding that TBG already has other "extensive evidence" misses the mark. TBG is entitled to discover any nonprivileged information, cumulative or not ... The issue, therefore, is whether he has a protectible privacy interest in the information to be found on the computer."
Article I, Section I, of the California Constitution provides that "All people are by nature free and independent and have inalienable rights. Among these are enjoying and defending life and liberty, acquiring, possessing, and protecting property, and pursuing and obtaining safety, happiness, and privacy."
The Court continued that "to prevent a constitutionally prohibited invasion of privacy, the plaintiff must establish ``(1) a legally protected privacy interest; (2) a reasonable expectation of privacy in the circumstances; and (3) conduct by defendant constituting a serious invasion of privacy. " (Citation omitted.) The Court assumed a legally protected privacy interest, but found that Zieminski had no reasonable expectation of privacy, because he has signed an agreement not to use the PC for personal use, and to allow his employer to monitor its use. The Court wrote that "By any reasonable standard, Zieminski fully and voluntarily relinquished his privacy rights in the information he stored on his home computer, and he will not now be heard to say that he nevertheless had a reasonable expectation of privacy."
However, the Court also wrote that it assumes "the existence of an abstract privacy interest in Zieminski's financial and other personal information", and added that "the trial court may in any event make such orders as are necessary to minimize TBG's intrusion."
FCC Approves Verizon's Rhode Island Long Distance Application
2/22. The Federal Communications Commission (FCC) issued an order [101 pages in PDF] approving Verizon's Section 271 application to provide in region interLATA services originating in the state of Rhode Island. See also, FCC release.
NAB Comments on Webcasting Royalty Payments
2/22. National Association of Broadcasters P/CEO Edward Fritts released a statement on the Copyright Arbitration Royalty Panel's (CARP) recommendations regarding royalties and webcasting.
He stated that "The ruling from the Copyright Arbitration Royalty Panel may have the effect of unintended consequences, in that many radio broadcasters may reevaluate their streaming strategies. If the powerful record company interests' goal was to strangle a fledgling new service to radio listeners, it may have succeeded beyond its own expectations."
On February 20, the CARP released its report [1 page in PDF] recommending rates, and its report [29 pages in PDF] recommending terms, for the statutory license for eligible nonsubscription services to perform sound recordings publicly by means of digital audio transmissions, also known as webcasting, pursuant to 17 U.S.C. 114, and to make ephemeral recordings of sound recordings for use of sound recordings under the statutory license set forth in 17 U.S.C. 112.
House to Vote on Tauzin Dingell Bill
2/25. The House of Representatives is scheduled to vote this week on HR 1542, titled the "Internet Freedom and Broadband Deployment Act of 2001". The bill is better known as the Tauzin Dingell bill, for its lead sponsors, Rep. Billy Tauzin (R-LA) and Rep. John Dingell (D-MI), the Chairman and ranking Democrat of the House Commerce Committee.
The House Rules Committee set a deadline of 4:00 PM on Monday, February 25, for Members of the House to submit proposed amendments to the bill. (See, Cong. Rec., Feb. 7, 2002, at H217.) Floor debate on the bill has been scheduled for Wednesday and Thursday, February 27-28.
The House Commerce Committee's Telecom Subcommittee marked up the bill on April 26, 2001. See, TLJ Alert No. 175. The full Commerce Committee marked up the bill on May 9, 2001. See, TLJ Alert No. 184. The House Judiciary Committee reported the bill unfavorably on June 13, 2001. See, TLJ Alert No. 208. All hearings and markups were contentious.
The bill would change the regulatory environment in which the Baby Bells operate. It would, among other things, exempt interLATA data from Section 271 requirements. Supporters of the bill argue that it will incent the Baby Bells to deploy broadband Internet access services, particularly digital subscriber line (DSL) service. Supporters also argue that the bill will increase the Bells' ability to compete with broadband cable service providers.
Opponents argue that the bill will end competition in local phone markets, revert the Bells to monopoly status, kill off many of the CLECs, and reduce innovation and investment in new technologies and companies.
Bush Addresses China WTO Membership
2/22. President Bush gave a speech at Tsinghua University, in Beijing, PR China. He stated that "China has joined the World Trade Organization, and as you live up to its obligations, they inevitably will bring changes to China's legal system. A modern China will have a consistent rule of law to govern commerce and secure the rights of its people. The new China your generation is building will need the profound wisdom of your traditions. The lure of materialism challenges our society -- challenges society in our country, and in many successful countries. Your ancient ethic of personal and family responsibility will serve you well."
People and Appointments
2/22. Clifford Hyatt joined the San Diego office of the law firm of Gray Cary as a special counsel in the firm's securities litigation practice. He was previously Deputy Assistant Regional Director of the Securities and Exchange Commission's (SEC) Pacific Regional Office. He handled the case SEC v. Mark Jakob, an Internet fraud case involving a fake press release regarding Emulex. He will focus on SEC investigations and defense, securities class action defense, corporate internal investigations, NASD arbitrations, and broker dealer, investment company and investment adviser compliance. See, GC release.
2/22. Janis Kestenbaum joined the Washington DC office of the law firm of Wilmer Cutler & Pickering as counsel in the firm's Communications and Electronic Commerce practice. She previously worked at the law firm of Jenner & Block. Before that, she was a trial attorney at the Department of Justice's Federal Programs Branch. See, WCP release.
2/19. Matthew Lehr and Anthony Klein joined the Palo Alto office of the law firm of Latham & Watkins as partners. Both were previously partners in the Palo Alto office of the law firm of Cooley Godward. Lehr is an intellectual property litigator who focuses on biotechnology, computer architecture, chemical products, plasma physics and electrical devices, computer networking and software, and consumer products. Klein focuses on licensing and technology transactions in the software, telecommunications, Internet, e-commerce, and semiconductor industries. He handles software licensing and distribution deals, manufacturing, supply and OEM relationships, semiconductor design and fabrication agreements, outsourcing arrangements, internet traffic deals and co-marketing alliances, game development deals, settlement agreements, strategic alliances, joint ventures, development agreements, asset transfers and co-branding and marketing arrangements, and other business relationships. See, LW release.
2/19. Beth Brinkmann joined the Washington DC office of the law firm of Morrison & Foerster as Of Counsel in the firm's Appellate Practice Group. She previously worked in the Office of the Solicitor General at the Department of Justice. See, MoFo release.
More News
2/22. Securities and Exchange Commission (SEC) Commissioner Isaac Hunt gave a speech in which he offered numerous recommendations for Congressional legislation. For example, he recommended a ban on accounting firms providing consulting services to their audit clients.
2/22. Securities and Exchange Commission (SEC) Chairman Harvey Pitt gave a speech regarding the legal and accounting professions.
2/22. Thomas Hazlett and Bruno Viani co-authored a study [40 pages in PDF] titled "Legislators v. Regulators: The Case of Low Power FM Radio".
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Notices & Disclaimers
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Monday, Feb 25
The Senate will reconvene at 12:00 NOON following its Presidents Day recess. It is scheduled to take up to the campaign finance bill. The House will not be in session.
4:00 PM. Deadline for Members of the House to submit to the House Rules Committee proposed amendments to HR 1542, the Tauzin Dingell bill. See, Cong. Rec., Feb. 7, 2002, at H217.
6:30 PM. The National Press Club will host a panel discussion on distance learning. The topics to be discussed include copyright issues. The speakers will be Deborah Everhart ( and Martin Irvine (Georgetown Univ.). Coffee reception starts at 6:30 PM. The program starts at 7:15 PM. Location: NPC, 529 14th St. NW, 13th Floor.
Deadline to submit oppositions and responses to the FCC's Cable Services Bureau regarding the applications of Hughes and EchoStar to the FCC requesting consent to the transfer of control of licenses and authorizations involved in the EchoStar DirecTV merger. See, FCC notice [MS Word]. This is CS Docket No. 01-348.
Tuesday, Feb 26
The House will reconvene following its Presidents Day recess. It will meet at 12:30 PM for morning hour, and 2:00 PM for legislative business. The House will consider a number of bills under suspension of the rules.
10:00 AM. The Senate Appropriations Subcommittee's Subcommittee on Commerce, Justice, State, and the Judiciary will meet in open session regarding the Department of Justice (DOJ) budget request for FY 2003. Attorney General John Ashcroft is scheduled to appear. Location: Room 138, Dirksen Building.
10:00 AM. The Senate Banking Committee will hold a hearing to examine accounting and investor protection issues, focusing on proposals for change relating to financial reporting by public companies, accounting standards, and oversight of the accounting profession. See, witness list. Location: Room 538, Dirksen Building.
12:15 PM. The FCBA's Cable Practice Committee and the NCTA will host a luncheon. The speaker will be Sarah Whitesell, Associate Bureau Chief of the FCC's Cable Services Bureau. The price to attend is $15. RSVP to Wendy Parish at wendy Reservations and cancellations must be received by Friday, February 22. Location: 1724 Mass. Ave., NW.
1:00 - 4:00 PM. Rep. Gil Gutknecht (R-MN), Vice Chairman of the House Science Committee, will hold a "Technology and Terrorism Demonstration". Location: Room 2318, Rayburn Building.
4:00 PM. The House Judiciary Committee's Subcommittee on Crime will mark up HR 3482, the "Cyber Security Enhancement Act of 2001". Rep. Lamar Smith (R-TX), the Chairman of the Subcommittee, and the sponsor of the bill, will likely offer an amendment in the nature of a substitute. Location: Room 2237, Rayburn Building.
Deadline to submit reply comments to the 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 27
The House will meet at 10:00 AM. The House is scheduled to begin consideration of HR 1542, the Tauzin Dingell bill.
Day one of a two day conference titled "Combatting Cyber Attacks on Your Corporate Data". See, conference information page. Location: Omni Shoreham Hotel.
10:00 AM. The Senate Judiciary Committee will hold a hearing to examine sovereign immunity and the protection of intellectual property. Sen. Patrick Leahy (D-VT) will preside. Location: Room 226, Dirksen Building.
10:00 AM. The House Ways and Means Committee will hold a hearing on the WTO's extraterritorial income decision. Location: Room 1100, Longworth Building.
10:00 AM. The House Financial Services Committee will hold a hearing to receive testimony of the Alan Greenspan, Chairman of the Federal Reserve Board of Governors. Location: Room 2128, Rayburn Building.
6:00 - 8:00 PM. The FCBA will host a Continuing Legal Education seminar titled Unlicensed Operation Under FCC Rules. The price to attend is $60 for FCBA members, $50 for government and law student members, and $80 for non-members. Registrations and cancellations due by 12:00 NOON on Tuesday, February 26. To register, contact Wendy Parish at wendy Location: Capital Hilton Hotel, 16th & K Streets, NW.
Extended deadline to submit reply comments to the Copyright Office in response to its March 9, 2001, Notice of Inquiry concerning the interpretation and application of the copyright laws to certain kinds of digital transmissions of prerecorded musical works in light of an agreement between the RIAA, the NMPA, and The Harry Fox Agency (HFA). See, 17 U.S.C. 115. See, notice in Federal Register.
Thursday, Feb 28
The House will meet at 10:00 AM. The House is scheduled to continue its consideration of HR 1542, the Tauzin Dingell bill.
Day two of a two day conference titled "Combatting Cyber Attacks on Your Corporate Data". See, conference information page. Location: Omni Shoreham Hotel.
9:30 AM. The Senate Commerce Committee will hold a hearing titled Protecting Content in a Digital Age -- Promoting Broadband and the Digital Television Transition. Sen. Ernest Hollings (D-SC) will preside. Location: Room 253, Russell Building.
12:15 PM. The FCBA's Transactional Practice Committee will host a brown bag lunch on mass media transactions. RSVP to Sue Fischer at 202 776-2000. Location: Dow Lohnes & Albertson, 1200 New Hampshire Ave., NW.
1:00 - 5:00 PM. The FCC's Wireless Telecommunications Bureau will hold a public forum addressing issues related to the acquisition and analysis of data on the state of competition in the commercial mobile radio services industry for the 7th Annual CMRS Competition Report. Location: FCC, 445 12th Street, SW, Room TW-C305.
4:00 PM. Adam Mossoff (Northwestern Univ. School of Law) will give a lecture titled The Relevance of Natural Rights in Intellectual Property Today. For more information, contact Prof. Robert Brauneis by e-mail or phone at 202 994-6138. Location: George Washington Univ. Law School, 2000 H Street, NW.
6:30 - 8:30 PM. FCC Commissioner Michael Copps will speak at a FCBA reception on "the value of mentoring in building a career." Location: Kelley Drye & Warren, 1200 19th Street, NW.
Friday, March 1
The House will not be in session.
Deadline to submit public comments to the FTC regarding the use of disgorgement as a remedy for competition violations, including those involving the Hart Scott Rodino Premerger Notification Act, FTC Act, and Clayton Act. See, FTC release and Federal Register notice.
Deadline to file comments with the FCC in response to its notice of proposed rulemaking regarding the appropriate regulatory requirements for incumbent local exchange carriers' provision of broadband telecommunications services. The FCC adopted this NPRM at its December 12 meeting. See, notice in the Federal Register.
Deadline to submit reply comments to the FCC regarding Verizon's Section 271 application to provide in region interLATA services in the state of Vermont. See, FCC notice [PDF].