|Sen. Hollings Introduces
Copy Protection Bill
|3/21. Sen. Ernest
Hollings (D-SC) introduced S 2048, the "Consumer
Broadband and Digital Television Act", a bill that would
require software and electronic equipment makers to build copy
protection technology into their products.
The bill states that the FCC "in
consultation with the Register of Copyrights, shall make a
determination, not more than 12 months after the date of
enactment of this Act, as to whether (A) representatives of
digital media device manufacturers, consumer groups, and
copyright owners have reached agreement on security system
standards for use in digital media devices and encoding rules;
and (B) the standards and encoding rules conform to the
requirements of" the bill.
The bill further states that if such an agreement is reached,
then the FCC shall initiate a rule making proceeding to codify
the agreement. However, if such an agreement is not reached,
then the FCC shall initiate a rule making proceeding "to
adopt security system standards and encoding rules that
conform" with the standards and encoding rules of the
Security System Standards. The bill requires that
"the security system standards shall ensure, to the
extent practicable, that (1) the standard security
technologies are (A) reliable; (B) renewable; (C) resistant to
attack; (D) readily implemented; (E) modular; (F) applicable
to multiple technology platforms; (G) extensible; (H)
upgradable; (I) not cost prohibitive; and (2) any software
portion of such standards is based on open source code".
Encoding Rules. The bill requires that "In
achieving the goal of promoting as many lawful uses of
copyrighted works as possible, while preventing as much
infringement as possible, the encoding rules shall take into
account the limitations on the exclusive rights of copyright
owners, including the fair use doctrine." It further
requires that "No person may apply a security measure
that uses a standard security technology to prevent a lawful
recipient from making a personal copy for lawful use in the
home of programming at the time it is lawfully performed, on
an over the air broadcast, premium or non-premium cable
channel, or premium or non-premium satellite channel, by a
television broadcast station ... , a cable system ... , or a
satellite carrier ..." (Citations to the U.S. Code
The bill prohibits a "manufacturer, importer, or seller
of digital media devices" from selling, or offering for
sale, in interstate commerce, "a digital media device
unless the device includes and utilizes standard security
technologies that adhere to the security system
standards" required by this bill.
Hillary Rosen, P/CEO of the Recording
Industry Association of America (RIAA), stated that
"The introduction of the 'Consumer Broadband Act' sends
an unmistakable signal about the importance of protecting
digital music and other content from piracy. Without stringent
protections, online piracy will continue to proliferate and
spin further out of control."
"We appreciate that Senators Hollings, Stevens, Inouye,
Breaux, Nelson and Feinstein have sent a wake up call to the
information technology and consumer electronics industries
that the time has come to achieve a voluntary marketplace
solution to the growing threat of online piracy. We have been,
and continue to be, eager to work out a voluntary solution,
for that is in the best interests of everyone involved,
especially the American consumer. We look forward to working
with the Senate and House Commerce and Judiciary Committees on
combating the digital piracy that threatens the development of
the legitimate marketplace for music," said Rosen.
|Sen. Leahy Reintroduces
Bill to Close 11th Amendment Loophole to IPR
|3/19. Sen. Patrick Leahy
(D-VT) and Sen. Sam
Brownback (R-KS) introduced S 2031,
the Intellectual Property Protection Restoration Act of 2002.
This is the latest version of Sen. Leahy's proposal to stop
states from evading liability for infringing intellectual
property rights by asserting 11th Amendment immunity.
The bill states that its purpose is to "eliminate the
unfair commercial advantage that States and their
instrumentalities now hold in the Federal intellectual
property system because of their ability to obtain protection
under the United States patent, copyright, and trademark laws
while remaining exempt from liability for infringing the
rights of others."
Supreme Court Cases. The problem addressed by this bill
arose in 1996 when the Supreme Court of the U.S. ruled in Seminole
Tribe of Florida v. Florida that the Congress lacks
authority under Article I of the Constitution to abrogate the
States' 11th Amendment immunity from suit in federal courts.
See also, the 1999 opinions of the Supreme Court in Florida
Prepaid Postsecondary Education Expense Board v. College
Savings Bank (invalidating the Patent and Plant Variety
Protection Remedy Clarification Act) and College
Savings Bank v. Florida Prepaid Postsecondary Education
Expense Board (invalidating the Trademark Remedy
Eleventh Amendment. "The Judicial power of the
United States shall not be construed to extend to any suit in
law or equity, commenced or prosecuted against one of the
United States by Citizens of another State, or by Citizens or
Subjects of any Foreign State."
Huge Loophole. Sen. Leahy stated in the Senate on March
19 that "the decisions opened up a huge loophole in our
Federal intellectual property laws. If we truly believe in
fairness, we cannot tolerate a situation in which some
participants in the intellectual property system get legal
protection but need not adhere to the law themselves. If we
truly believe in the free market, we cannot tolerate a
situation where one class of market participants have to play
by the rules and others do not." Cong. Rec., March 19,
2002, at S2079.
Related Bills. Sen. Leahy previously introduced S 1611,
the Intellectual Property Protection Restoration Act of 2001,
on November 1, 2001. The Senate Judiciary
Committee, which Sen. Leahy chairs, held a hearing on that
bill on February 27, 2002. S 2031 revises the previous
bill in light of hearing testimony. Sen. Leahy also sponsored
similar legislation in the 106th Congress. The related bill in
the House is HR 3204,
sponsored by Rep. Howard
Coble (R-NC) and Rep.
Howard Berman (D-CA).
Summary of S 2031. This bill would prevent states from
recovering damages for infringement of state owned
intellectual property, unless they have first waived their
11th Amendment sovereign immunity from suits against them for
their infringement of the intellectual property of others.
This bill would also provide that states that violate
intellectual property rights "in a manner that deprives
any person of property in violation of the fourteenth
amendment of the United States Constitution, shall be liable
to the party injured in a civil action in Federal court for
compensation for the harm caused by such violation." The
bill contains similar language for violations which constitute
takings under the 5th Amendment.
|Senate Committee Approves
|3/21. The Senate
Governmental Affairs Committee amended and approved S 803,
the "E-Government Act of 2001". The bill is
sponsored by Sen. Joe
Lieberman (D-CT), the Chairman of the Committee.
The bill would establish an Office of Electronic Government
headed by a Senate confirmed administrator within the Office
of Management and Budget, authorize the appropriation of $345
Million over four years for an e-government fund to support
interagency e-government projects, establish an online
directory of federal web sites, require federal courts to
publish opinions online, and fund a federal training center to
recruit and train information technology professionals. See, Committee
|State Department Official
Addresses Worldwide IT Development
|3/21. David Gross gave a speech
at Third World Telecommunications Development Conference, in
Istanbul, Turkey, in which he addressed promoting information
technologies around the world.
He stated that "While advances of democracy and free
markets have brought prosperity to billions of people, too
many people are being left behind." He added that
"information based technologies are fundamental to
meeting basic development objectives".
Gross also offered several recommendations: "Build human
capacity through training, education, and knowledge creation
initiatives. Ensure the participation of local communities and
the development of local content. Promote private sector
leadership and regulate only when necessary. Establish
administrative and economic systems based on predictable and
transparent rules, and especially good governance."
Gross is the Deputy Assistant Secretary of State for
International Communications and Information Policy. He is the
head of the U.S. Delegation to the conference.
|Cal App Rules on Malicious
Prosecution of Trademark Claims
|3/20. The California
Court of Appeal (2/7) issued its opinion
[PDF] in Vanzandt
v. Daimler Chrysler, a case regarding malicious
prosecution involving trademark claims.
Ted Vanzandt filed a complaint in Superior Court in Los
Angeles County, California, against Daimler Chrysler, its law
firms, and individual attorneys, alleging malicious
prosecution. In a previous action, Daimler Chrysler filed a
complaint in U.S. District Court against Vanzandt alleging
trademark infringement, trademark dilution, and unfair
competition in connection with Vanzandt's production and sale
of radiator grille overlays for Daimler Chrysler Jeep
vehicles. The District Court initially granted Daimler
Chrysler partial summary judgment. However, the U.S. Court of
Appeals reversed, and Vanzandt ultimately prevailed in that
action. In the present action, the Superior Court held that
the complaint was barred because Vanzant could not demonstrate
that the defendants lacked probable cause to prosecute the
The Court of Appeal affirmed. It wrote that "The tort of
malicious prosecution recognizes the right of an individual to
be free from unjustifiable litigation or criminal
prosecution." However, it cautioned that "the action
has traditionally been regarded with disfavor and the tort's
elements have been strictly construed and carefully
The Court of Appeals listed the elements of a malicious
prosecution claim: "the prior action (1) was commenced by
or at the direction of the defendant and was pursued to a
legal termination in the plaintiff’s favor; (2) was brought
without probable cause; and (3) was initiated with
This case focused on the element of probable cause. The Court
of Appeal elaborated that "A plaintiff has probable cause
to bring a civil suit if the claim is legally tenable. This
issue is considered objectively, without regard to the mental
state of the plaintiff or counsel; and the trial court
determines as a question of law whether probable cause exists.
... Probable cause may be found even where a suit lacks
The Court of Appeal concluded that since the U.S. District
Court had initially ruled in Daimler Chrysler's favor, there
was probable cause. It wrote, "Where a plaintiff in the
underlying action obtains a favorable judgment on the merits,
such ruling is, unless procured by fraud, conclusive proof the
proceedings were prosecuted with probable cause,
notwithstanding the fact the decision is reversed on
The opinion provides little guidance where the defendant in a
malicious prosecution action did not obtain a favorable
|3/21. The House
Financial Services Committee held a hearing titled
"The Effects of the Global Crossing Bankruptcy on
Investors, Markets, and Employees". See, prepared
testimony of witnesses: John
Legere (Global Crossing), Dan
Cohrs (Global Crossing), Afshin
Mohebbi (Qwest), Michael
Salsbury (WorldCom), Andrew
McGrath (Cable and Wireless Global), John
Morrissey (SEC), Scott
Cleland (Precursor Group), and Will
3/21. The General Accounting
Office (GAO) released a report [PDF]
titled "Information Technology: OMB Leadership Critical
to Making Needed Enterprise Architecture and E–government
Progress". The report was prepared as testimony for the House Government Reform
Committee's Technology and Procurement Policy Subcommittee
hearing on March 21 titled "How The Federal Government
Can Transition From Old Economy Speed to Become A Model for
3/21. President Bush signed an Executive
Order establishing the President's Homeland Security
|High Tech v. High Touch
Reserve Board Governor Susan Bies
gave a speech
titled "Current Challenges of Community Banks" to
the Ohio Bankers Day Conference in Columbus, Ohio. She stated
that "The surprisingly strong and persistent growth in
the number of branch offices also suggests that the personal
touch, which plays to the strength of community banks, remains
an important element of banking in the age of the
|DOJ Recommends Approval of
BellSouth's GA & LA Long Distance Applications
|3/21. The Department of
Justice (DOJ) submitted to the Federal Communications Commission
(FCC) its evaluation
[31 pages in PDF] of BellSouth's
271 application to provide in region interLATA services in
the states of Georgia and Louisiana. The DOJ "recommends
that the FCC approve BellSouth's application." This is CC
Docket No. 02-35.
Herschel Abbott, BellSouth's VP for governmental affairs,
stated in a release that "Competition is flourishing
throughout the BellSouth region, with close to 300 competitors
offering local service to more than four million lines in the
region -- approximately 1.3 million of those in Georgia and
|Friday, March 22
|The House will not be in session.
The "Managing the New Privacy Revolution" conference
will meet regarding "Internet and Global Issues".
The program includes panel discussions and speeches on
Biometrics and Privacy on the Internet (9:10 - 10:15); Online
Marketing: CRM, Permissions and SPAM (10:45 - 11:45); Safe
Harbor (11:45 - 12:45); Japan, U.S. and Worldwide Patterns of
Data Protection (12:45 - 2:00); and Alternative Strategies for
Adopting Global Privacy Policies (2:00 - 3:30). See, agenda.
Location: Omni Shoreham Hotel, 2500 Calvert Street, NW.
9:00 AM. The House
Government Reform Committee's District of Columbia
Subcommittee will hold a hearing titled "Privacy v.
Security: Electronic Surveillance in the Nation's
Capital". Location: Room 2154, Rayburn Building.
10:00 AM - 1:00 PM. The Network
Reliability and Interoperability Council (NRIC) will hold
a meeting. See, FCC
notice [PDF] of March 14, and notice
in Federal Register. Location: Room TW-C305, FCC, 445 12th St.
|Monday, March 25
|The House and Senate will be in recess for the Spring
District Work Period. They will return on Monday, April 8.
9:15 AM - 12:25 PM. The Department of Commerce will host a
roundtable titled "Understanding Broadband Demand:
Broadband & Business Productivity". The event will be
chaired by Phil Bond (Under Secretary for Technology),
Kathleen Cooper (Under Secretary for Economic Affairs), and
Bruce Mehlman (Assistant Secretary for Technology Policy).
Location: Room 4830, U.S. Department of Commerce, 14th &
Constitution Avenue, NW.
|Tuesday, March 26
|8:00 AM - 5:15 PM. The Michigan State University Quello
Communications Law and Policy Symposium will host its Third
Annual Rethinking Access conference. See, schedule of
speakers. Location: Willard Intercontinental Hotel.
|Wednesday, March 27
|11:00 AM. The Cato Institute
will host a panel discussion on spam. The speakers will be
Howard Beales (FTC), Rebecca Richards (TRUSTe), Chris Hoofnagle (Electronic Privacy Information
Center), and Jerry Cerasale (Direct Marketing Association).
registration page. Lunch will follow the program.
Location: Cato, 1000 Massachusetts Ave., NW.
12:15 PM. The FBCA's
Telecom Competition Committee will host a brown bag lunch. The
speakers will be Jim Bird, head of the FCC's
transactions team, and other FCC representatives. RSVP to
Wendy Parish at wendy @fcba.org.
Location: FCC, 445 12th Street, SW, Eighth Floor, Conference
12:30 PM. Larry Thompson, Deputy Attorney General of
the U.S., will speak at the Heritage
Foundation. See, notice.
Location: 214 Massachusetts Ave NE.
|Thursday, March 28
12:15 PM. The FCBA's
Young Lawyers Committee will host a brown bag luncheon. The
topic will be "Putting the ``Mass´´ Back in Media -- A
First Amendment Right to Bulk Up." The speaker will be
Paul Gallant, Special Advisor to Kenneth Ferree, Bureau Chief
of the Cable Services Bureau, and a member of the Media
Ownership Working Group. RSVP to rwallach @willkie.com.
Location: Willkie Farr &
Gallagher, 1155 21st Street, NW (between L & M), 6th
4:00 PM. John
Duffy (Marshall Wythe School of Law) will give a lecture
titled "The Puzzling Persistence of the Ideal of Marginal
Cost Pricing in the Economic Analysis of Patents". For
more information, contact Robert Brauneis at rbraun @main.nlc.gwu.edu
or 202 994-6138. Location: George Washington University Law
School, 2000 H Street, NW.
Deadline to submit comments to the FCC regarding
ways to improve its electronic licensing systems. See, FCC
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