Tech Law Journal Daily E-Mail Alert
March 12, 2002, 9:00 AM ET, Alert No. 386.
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Sen. Burns Seeks Hearing on ICANN
3/11. Sen. Conrad Burns (R-MT) wrote a letter to Sen. Ernest Hollings (D-SC) requesting that the Senate Commerce Committee hold an oversight hearing regarding the Internet Corporation for Assigned Names and Numbers (ICANN) and the future of Internet governance. Sen. Hollings is the Chairman of the Committee.
Sen. Burns wrote that "ICANN is currently a fundamentally flawed and ineffective governing entity". He also wrote that "more fundamental questions also need to be addressed, such as whether ICANN is even the most appropriate organization to be tasked with such a critical mission, which is central to our national security."
Distance Learning and Telemedicine Grants and Loans
3/11. The U.S. Department of Agriculture's (USDA) Rural Utilities Service (RUS) published two notices in the Federal Register regarding its Distance Learning and Telemedicine Loan and Grant Program. Last year, the RUS provided 22 distance education grants totaling $5.1 Million, and 23 telemedicine grants totaling $6.3 million.
The RUS published a notice in the Federal Register on March 11 that covers application deadlines. It states that "For FY 2002, $27 million in grants and $300 million in loans will be made available for distance learning and telemedicine projects serving rural America. The funding will be provided in three categories: (1) $17 million will be available for grants; (2) $200 million will be available for loans; and (3) $110 million will be available for combination grants and loans ($100 million in loans paired with $10 million in grants, i.e., $10 loan: $1 grant ratio)."
This notice further states that "Applications for grants must be postmarked no later than May 13, 2002. Applications for FY 2002 loans or combination loans and grants may be submitted at anytime up to August 31, 2002, and will be processed on a first come, first serve basis." See, Federal Register, March 11, 2002, Vol. 67, No. 47, at Page 10890.
The RUS published a second notice in the Federal Register on March 11 stating that the amendments to its rules, announced in a notice in the Federal Register on January 23, are now in effect. The March 11 notice states the RUS "hereby gives notice that no adverse comments were received regarding the direct final rule amending its regulations for the Distance Learning and Telemedicine (DLT) Loan and Grant Program, and confirms the effective date of the direct final rule. ... The direct final rule published in the Federal Register on January 23, 2002 (67 FR 3039) is effective March 11, 2002."
The amendments clarify eligibility, change the grant minimum matching contribution, clarify that only loan funds will be used to finance transmission facilities, modify financial information requirements, adjust the leveraging of resources scoring criterion, and revise financial information to be submitted. See, Federal Register, March 11, 2002, Vol. 67, No. 47, at Pages 10830 - 10831, and Federal Register, January 23, 2002, Vol. 67, No. 15, at Pages 3039 - 3041.
SEC Requests Documents from WorldCom and Qwest
3/11. WorldCom stated in a release that "it has received a confidential request from the Securities and Exchange Commission for voluntary production of documents and information." See, March 7 letter [1MB in PDF] from SEC to WorldCom.
Similarly, Qwest stated in a release that "it received an informal inquiry from the Denver regional office of the Securities and Exchange Commission (SEC) requesting voluntary production of documents. Qwest intends to respond fully to this request, which was received in a letter Friday, March 8, 2002."
SEC Chairman Addresses Regulation of Accounting
3/11. Securities and Exchange Commission (SEC) Chairman Harvey Pitt gave a speech to the Securities Industry Association (SIA) Compliance and Legal Division Seminar in Palm Desert, California.
He stated that "An impressive facet of the securities industry is its foundation on private sector regulation. Congress long ago wisely realized it isn't enough to have vigorous laws. The highest ethical standards and the most demanding competence requirements also must be imposed. Government can focus on illegality. But, the highest ethical standards and the best standards of competence must come from, and be enforced vigorously by, the affected industry or profession."
He continued: "We seek to utilize that base for the accounting profession. Rather than self regulation, however, we espouse private sector regulation. Our thought is that persons unaffiliated with accounting firms should govern the new private sector regulator we envision. The new regulatory board should also have the ability to tap into the expertise of a small number of accountants to ensure that the new regulatory body has all the technical expertise it requires. The system we envision will subject the profession to affirmative ethical requirements, and compel auditors to be well grounded in appropriate ethical and crisis management techniques, and to achieve a high level of competence. We are seeking to ensure that accountants not only comply with the law, but also exceed it by conforming to the highest ethical and competence standards."
GAO Reports on OMB Information Resource Management
3/11. The General Accounting Office (GAO) released a report [PDF] titled "Information Resource Management: Comprehensive Strategic Plan Needed to Address Mounting Challenges".
The report notes that "As agencies have struggled with issues involving intelligence gathering, information sharing and dissemination, security, and information technology (IT), it has become increasingly apparent that our government needs to better assess -- from a strategic standpoint -- all aspects of how it handles information."
The report specifically addresses the performance of the Office of Information and Regulatory Affairs (OIRA) at the Office of Management and Budget (OMB), and its information resources management (IRM) plan. The GAO report concludes that "OIRA has not established an effective governmentwide strategic IRM plan".
The report recommends, among other things, that "the administrator, OIRA, develop and implement a governmentwide strategic IRM plan that articulates a comprehensive federal vision and plan for all aspects of government information. In addition, recognizing the new emphasis that OMB has placed on e-government, it will be important that the administrator work in conjunction with the associate director for technology and e-government in developing this plan."
The report was written at the request of Sen. Joe Lieberman (D-CT), Chairman of the Senate Governmental Affairs Committee.
People and Appointments
3/11. The Federal Bureau of Investigation (FBI) announced that it has hired Sherry Higgins and Kenneth Ritchhart to support the FBI's efforts to rebuild its information infrastructure, and to support its recruiting efforts. Higgins previously worked for 30 years at AT&T, and later, Lucent. The FBI stated that Ritchhart "brings twenty years of project and information technology management experience, including expertise in database systems and structures to the Bureau. Mr. Ritchhart is well known with the Intelligence Community as a result of his prior government service where he was active in information sharing initiatives. Most recently Mr. Ritchhart served as Program Manager, Joint Intelligence Virtual Architecture, Defense Intelligence Agency". See, FBI release.
3/8. Deborah Klein was named Chief of Staff of the newly created Media Bureau at the Federal Communications Commission (FCC). She was previously Chief of the Consumer Protection and Competition Division of the Cable Services Bureau. Before that, she was an attorney at the Federal Trade Commission's (FTC) Bureau of Competition, where she worked on antitrust investigations and litigation. See, FCC release. (The FCC's new Media Bureau will handle the policy and licensing programs relating to electronic media, including cable TV, broadcast TV and radio in the U.S. and its territories. It will also handle post licensing matters regarding Direct Broadcast Satellite (DBS) service. The FCC's reorganization plan takes effect on March 25. See, FCC release.)
3/8. Richard Engelman was named Chief Engineer, and Jacquelynn Ruff was named Assistant Bureau Chief, of the Federal Communications Commission's (FCC) International Bureau. Engelman has been with the FCC for 25 years. Ruff has been with the FCC since 1999. She previously worked for the law firm of Wilmer Cutler & Pickering.
FTC Sues Sellers of Non Existent Domain Names
2/28. The Federal Trade Commission (FTC) filed a complaint [PDF] in U.S. District Court (NDIll) against TLD Network Inc. alleging violation of Section 5(a) of the FTC Act, 15 U.S.C. § 45(a), in connection with advertising and selling over the Internet non existent .usa domain names. The District Court issued a Temporary Restraining Order [PDF] against defendants, which also affects all domain name registrars.
The complaint states that "Since approximately October 2001, Defendants have sold domain names ending in the suffix ``.usa.´´ ... Defendants send, or authorize others to send on their behalf, unsolicited commercial email to consumers, including consumers in the United States, advertising the availability of their domain names. ... Defendants advertise their domain names on Internet Web sites ... Defendants sell their domain names for $59 each. ... Many consumers, including consumers in the United States, have purchased such domain names."
The complaint states that in reality, "In order for a domain name to be readily accessible over the Internet, whether by its address or through indexing by a search engine, the name must be recognized and registered under protocols developed by the Internet Corporation for Assigned names and Numbers (ICANN). ICANN currently does not recognize any of the domain names being sold by Defendants, and has no plans to introduce domain names with the suffixes sold by Defendants."
The TRO enjoins defendants from making false or misleading statements regarding domain names. It also requires that "any party hosting any Web pages or Web sites for Defendants ... Immediately take whatever steps may be necessary to ensure that Web pages ... cannot be accessed by the public ..."
The TRO also requires "any other domain name registrar" to "Immediately suspend the registration and prevent the transfer of" domain names used by defendants to advertise their" non existent domain.
The TRO also freezes defendants' assets, enjoins the destruction of records, and expedites discovery. It set a hearing for March 11.
The complaint, motion for TRO, and memorandum in support [PDF] were filed on February 28. See also, FTC release.
Howard Beales, III, Director of the FTC's Bureau of Consumer Protection, stated: "They sent deceptive spam, and they sold worthless web addresses from their Web sites. By closing down this operation we're sending a strong signal: We will not tolerate deceptive spam."
Amazon and Barnes & Noble Settle Patent Case
3/7. Online booksellers and (BN) settled a patent infringement and validity case pending in the U.S. District Court (WDWash). Company representatives stated only that there is a settlement, and that its terms are confidential.
At issue was Amazon's U.S. Patent No. 5,960,411, which was issued on September 28, 1999. It is also sometimes referred to as the "one click" method and system for placing an order to purchase an item via the Internet.
Amazon filed its complaint in District Court on October 21, 1999, against BN alleging patent infringement, and seeking a preliminary injunction. Amazon alleged that BN's "Express Lane" ordering system infringes its 411 patent. BN, in turn, challenged the validity of the 411 patent. The District Court issued a preliminary injunction, and BN appealed that order.
On February 14, 2001, the U.S. Court of Appeals (FedCir) issued its opinion in Amazon v. Barnesandnoble, 239 F.3d 1343. The Court of Appeals found that Amazon carried its burden with respect to demonstrating the likelihood of success on the issue of infringement, but that BN raised substantial questions as to the validity of the 411 patent. It found that the District Court committed error by misreading the factual content of the prior art references, and by failing to recognize that BN had raised a substantial question of invalidity of the asserted claims in view of these prior art references. However, the Court hastened to add, "this conclusion only undermines the prerequisite for entry of a preliminary injunction. Our decision today on the validity issue in no way resolves the ultimate question of invalidity." Hence, the Appeals Court reversed and remanded to the District Court.
Amazon's 411 patent is frequently cited as an example by proponents of legislative reform in the area of business method patents.
Rep. Howard Berman (D-CA) and Rep. Rick Boucher (D-VA) have introduced bills in this, and the previous, Congress that would make several changes to the business method patent process. See, HR 1332, the Business Method Patent Improvement Act of 2001. See also, HR 5364 (106th Congress), and TLJ story, Bill Would Change Business Method Patent Process, October 3, 2000.
More recently, on February 20, the European Commission released a proposal for a Directive on patents of computer implemented inventions. See, document titled "Patents: Commission proposes rules for inventions using software" and document titled "Proposal for a Directive on the patentability of computer implemented inventions -- frequently asked questions".
The proposal states that inventions "whose operation involves the use of a computer program and which make a ``technical contribution´´ -- in other words which contribute to the ``state of the art´´ in the technical field concerned -- would be eligible for patents. Computer programs as such would not be eligible for a patent under the proposal. Nor would business methods that employ existing technological ideas and apply them to, for example, e-commerce. These would continue where appropriate to be covered by copyright law or the law of confidentiality."
Samsung Sues SanDisk for Patent Infringement
3/5. Samsung filed a complaint in U.S. District Court (EDTex) against SanDisk alleging patent infringement. Samsung alleges infringement of four patents of which it is the assignee: U.S. Patents Nos. 5,473,563 (titled Nonvolatile semiconductor memory), 5,514,889 (Non-volatile semiconductor memory device and method for manufacturing the same), 5,546,341 (titled Nonvolatile semiconductor memory), and 5,642,309 (Auto-program circuit in a nonvolatile semiconductor memory device). Samsung seeks injunctive and monetary relief.
Charles Van Orden, VP and General Counsel of SanDisk, stated in a release that "We believe this lawsuit is a tactical move on Samsung's part in advance of the upcoming expiration in August, 2002, of their patent cross license with SanDisk. We intend to vigorously defend against this action."
More News
3/11. President Bush signed into law HR 2998, the "Radio Free Afghanistan Act," which authorizes the establishment of and appropriations for Radio Free Afghanistan. See, White House release.
3/11. The U.S. Patent and Trademark Office (USPTO) published the March issue of the USPTO Pulse in its web site.
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House Subcommittee to Mark Up Internet Gambling Bill
3/11. The House Judiciary Committee's Subcommittee on Crime will meet to mark up HR 3215, the "Combating Illegal Gambling Reform and Modernization Act", at 4:00 PM on March 12. The bill is sponsored by Rep. Bob Goodlatte (R-VA), and 156 other Members of Congress, including Rep. Lamar Smith (R-TX), the Chairman of the Crime Subcommittee.
The bill would amend 18 U.S.C. §§ 1081 and 1084, which contain the definitions and prohibition, respectively, of the Wire Act. The Wire Act currently criminalizes the use of "wire communications facilities" in interstate commerce for gambling. The Wire Act does not ban gambling. This is a matter of state law. The Goodlatte bill expands the prohibition to cover all communications between states or with other foreign countries. It maintains the principle that gambling is otherwise a matter of state law. Hence, under the Goodlatte bill, use of the Internet for gambling purposes would become illegal (if interstate or foreign).
It was introduced on November 1, 2001. The Crime Subcommittee held a hearing on November 29, 2001. Rep. Goodlatte has been trying to pass legislation banning Internet gambling for several Congresses. See also, "Rep. Goodlatte Introduces Gambling Bill", TLJ Daily E-Mail Alert No. 300, Nov. 2, 2001.
Tuesday, March 12
The House will meet at 12:30 PM for morning hour and 2:00 PM for legislative business. No votes are expected before 6:30 PM. The House will consider a number of measures under suspension of the rules.
The Senate will meet at 10:30 AM, and resume consideration of the energy bill.
9:30 AM. The U.S. Court of Appeals (DCCir) will hear oral argument in USTA v. FCC, No. 01-1085. Judges Ginsburg, Rogers and Garland will preside. Location: 333 Constitution Ave. NW.
10:00 AM. The Senate Appropriations Subcommittee's Subcommittee on Commerce, Justice, State, and the Judiciary will hold a hearing on the administration's proposed budget estimates for FY 2003 for the Department of State. Location: Room 138, Dirksen Building.
1:30 PM. The U.S. International Telecommunication Advisory Committee (ITAC) will hold a meeting. See, notice in Federal Register, October 17, 2001, Vol. 66, No. 201, Page 52825. Location: State Department.
4:00 PM. The House Judiciary Committee's Subcommittee on Crime will meet to mark up HR 3215, the "Combating Illegal Gambling Reform and Modernization Act." Location: Room 2237, Rayburn Building.
5:00 PM. The House Rules Committee will meet to adopt a rule for consideration of HR 2341, the Class Action Fairness Act of 2001.
Wednesday, March 13
The House will meet at 10:00 AM for legislative business. The House may take up HR 2341, the Class Action Fairness Act of 2001.
7:30 AM. FTC Commissioner Orson Swindle will speak at the Baltimore Academies Business Professionals Breakfast on "consumer protection and competition issues". Location: Pikesville Hilton, 1726 Reistertown Road, Pikesville, MD.
10:00 AM. The House Financial Services Committee will hold a hearing on HR 3763, the "Corporate and Auditing Accountability, Responsibility, and Transparency Act of 2002". Location: Room 2128, Rayburn Building.
10:30 AM. The Senate Appropriations Subcommittee's Subcommittee on the Legislative Branch will hold hearings on the proposed budget estimates for FY 2003 for the Library of Congress (LOC) and the Congressional Research Service. The Copyright Office is a part of the LOC. Location: Room 124, Dirksen Building.
10:30 AM. The Senate Appropriations Subcommittee's Subcommittee on Commerce, Justice, State, and the Judiciary will hold a hearing on the administration's proposed budget estimates for FY 2003 for the Department of Commerce. Location: Room 116, Dirksen Building.
Thursday, March 14
The House will meet at 10:00 AM for legislative business.
9:00 AM. The House Judiciary Committee's Subcommittee on Courts, the Internet, and Intellectual Property will hold a hearing titled "Patent Law and Non-Profit Research Collaboration." Location: Room 2141, Rayburn Building.
9:30 AM. The FCC will hold a meeting. See, agenda. Location: FCC, 445 12th Street, SW, Room TW-C05.
10:00 AM. The Senate Judiciary Committee will hold a hearing to examine competition, innovation, and public policy concerning digital creative works. Location: Room 226, Dirksen Building.
10:00 AM - 12:00 NOON. The House Science Committee's Subcommittee on Environment, Technology, and Standards will hold a hearing titled "Technology Administration: Review and Reauthorization". Location: Room 2318, Rayburn Building.
11:00 AM. FTC Chairman Timothy Muris will speak at the 6th Annual Georgetown University Law Center (GULC) Corporate Counsel Institute. Location: GULC, 600 New Jersey Avenue, NW.
12:00 PM. The FCBA will host a luncheon. The speaker will be Craig McCaw, Ch/CEO of Teledesic. A reception will begin at 12:00 NOON, followed by lunch at 12:30 PM. RSVP to Wendy Parish at wendy by 12:00 NOON on Tuesday, March 12. Location: Capital Hilton Hotel, 16th and K Streets, NW.
Friday, March 15
The House will not be in session.
9:00 AM. The AFL-CIO's Department for Professional Employees will host a panel of speakers who will advocate retention of the FCC's newspaper and broadcast cross ownership rules. FCC Commission Michael Copps will speak. See, AFL-CIO notice. For more information, contact Leandra Kennedy at lkennedy or 202 638-0320. Location: National Press Club, Holeman Lounge, 529 14th St. NW, 13th Floor.
9:30 - 11:00 AM. The Progressive Policy Institute (PPI) will host a panel discussion on the impact of new homeland security efforts on privacy. The panelists will be Robert Atkinson (PPI), Shane Ham (PPI), and Jim Dempsey (Center for Democracy and Technology). RSVP to 202 547-0001. Location: PPI, 600 Pennsylvania Avenue, SE, Suite 400.
11:00 AM. FTC Chairman Timothy Muris will give the keynote address at the Consumer Federation of America's Assembly. Location: Washington Plaza Hotel, 10 Thomas Circle, NW.
Deadline to submit comments to the FCC on the World Radiocommunication Conference Advisory Committee's (WRC-03 Advisory Committee) recommendations of February 6, 2002, regarding the 2003 World Radiocommunication Conference (WRC-03). See, notice [16 pages in PDF] requesting public comments, and attached recommendations.
Monday, March 18
9:30 AM. The U.S. Court of Appeals (DCCir) will hear oral argument in Costa de Oro TV v. FCC, No. 01-1153. Judges Ginsburg, Henderson and Tatel will preside. Location: 333 Constitution Ave. NW.
12:00 NOON. Deadline to submit requests to Office of the U.S. Trade Representative (USTR) to testify orally at its April 1 hearing negotiation of a U.S. Singapore Free Trade Agreement. See, notice in the Federal Register.
Deadline to submit comments to the Federal Communications Commission (FCC) in response to its notice of proposed rulemaking (NPRM) regarding its unbundling analysis under § 251 of the Communications Act and the identification of specific unbundling requirements for incumbent local exchange carriers (ILECs). The FCC adopted this NPRM at its December 12 meeting. This is CC Docket No. 01-338. See, notice in the Federal Register, January 15, 2002. Note: SBC submitted a request for extension of deadline [PDF] on March 11.