Tech Law Journal Daily E-Mail Alert
March 26, 2002, 9:00 AM ET, Alert No. 396.
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9th Circuit Affirms Injunction and Shut Down Order in Napster Case
3/25. The U.S. Court of Appeals (9thCir) issued its opinion [PDF] in A&M Records v. Napster, affirming the modified preliminary injunction and shut down order of the U.S. District Court (NDCal).
The Appeals Court previously held Napster liable for contributory and vicarious infringement for operating a peer to peer music copying service. See, A&M Records v. Napster, 239 F.3d 1004 (9th Cir. 2001). The present appeal concerns the modified preliminary injunction (MPI) and shut down order of the District Court. The MPI requires Napster to remove any user file from the system's music index if Napster has reasonable knowledge that the file contains plaintiffs' copyrighted works; plaintiffs must give Napster notice of specific infringing files. The District Court ordered Napster to disable its file transferring service until certain conditions were met and steps were taken to ensure maximum compliance. The Appeals Court affirmed the MPI and shut down order.
Cary Sherman, General Counsel of the Recording Industry Association of America (RIAA), had this to say after the ruling. "Once again, the 9th Circuit Court of Appeals has affirmed that Napster must do everything feasible to police its system against copyright infringement. As we have said from the very beginning, technologies are available that allow copyrighted works to be filtered out of a peer to peer system, and the big news from today's decision is the court's strong endorsement of that point."
District Court Rules in Carnivore FOIA Case
3/21. The U.S. District Court (DC) issued its opinion [PDF] in Judicial Watch v. FBI, a Freedom of Information Act (FOIA) suit filed to compel release of documents related to the Federal Bureau of Investigation (FBI) e-mail surveillance system known as "Carnivore". The U.S. District Court (DC) dismissed the suit for failure to exhaust administrative remedies.
Judicial Watch submitted to the FBI a request for records pertaining to Carnivore, pursuant to the FOIA, 5 U.S.C. § 552. Judicial Watch asserts that the FBI did not comply with the requirements of the FOIA. It alleges that the FBI provided no documents. However, Judicial Watch did not file an administrative appeal within the FBI.
Judicial Watch instead proceeded directly to the filing of a complaint in District Court against the FBI alleging failure to comply with the FOIA. The FBI moved to dismiss. The District Court dismissed the complaint for failure to exhaust administrative remedies. The Court did not reach other issues, such as what documents the FBI would be required to release under a FOIA request.
The Electronic Privacy Information Center (EPIC) also submitted a separate FOIA request to the FBI regarding Carnivore. EPIC also filed a complaint in U.S. District Court (DC). See, EPIC's case summary with links to select pleadings and produced records.
Rep. Boucher Writes FCC Re Digital TV Set Top Boxes
3/21. Rep. Rick Boucher (D-VA) wrote a letter to the Federal Communications Commission (FCC) to "express my disappointment with the Commission's decision to keep secret the license agreement that a manufacturer must sign in order to bring to market a competitive ``navigation device´´ (such as a cable ready digital television receiver or a set top box) that can connect directly to a cable system." (Parentheses in original.)
At issue is the Cablelabs PHILA license. PHILA is an acronym for "POD-Host Interface License Agreement". POD is an acronym for "point of deployment". CableLabs stated in a January 7, 2002, release that "The PHILA is a portion of the CableLabs OpenCable project; companies that sign the accord receive a license to deploy proprietary technology necessary to manufacture OpenCable set tops. The agreement focuses on the copy protection technology of the connecting point between an OpenCable point of deployment (POD) card and the OpenCable set-top box. This interface is the link that allows a retail cable box to be portable across a variety of different cable system headends by standardizing the communication between individual addressable POD modules and the connected set-top terminals or navigation devices."
Rep. Boucher explained that "This is no ordinary license; it has clear public policy consequences, with direct effect on consumers. Congress needs to know whether its previous direction to the Commission with respect to the competitive availability of navigation devices has been carried out appropriately. It is indefensible that a license to implement a public trust, mandated by an act of Congress, be kept ``secret.´´ There is absolutely no public policy justification for this secrecy."
The Consumer Electronics Association (CEA) issued a release praising Rep. Boucher. The CEA also stated that the PHILA agreement contains anti consumer provisions.
People and Appointments
3/25. Rep. Robert Ehrlich (R-MD) announced his candidacy for Governor of Maryland. Rep. Ehrlich is currently a member of the House Commerce Committee.
3/25. Microsoft announced that Sen. John McCain (R-AZ), the ranking Republican on the Senate Commerce Committee, and Rick Belluzzo, P/COO of Microsoft, will appear together at Boys & Girls Clubs media event in Scottsdale, Arizona. See, MSFT release.
3/25. The Business Software Alliance (BSA) named Jeri Clausing Director of Public Relations / Policy. Clausing was previously Executive Editor of Interactive Week. Before that, she covered technology policy for the New York Times. She also has a Texas background. She previously worked at the Fort Worth Star Telegram and the Dallas Times Herald. She also graduated from Southern Methodist University in Dallas.
Commerce Department Hosts Broadband Demand Conference
3/25. The Department of Commerce (DOC) hosted a roundtable titled "Understanding Broadband Demand: Broadband & Business Productivity". Participants discussed what is broadband, what is the extent of business demand for broadband services, what are the applications of broadband access, and what are the benefits of broadband.
The DOC has bifurcated its examination of broadband. The National Telecommunications and Information Administration (NTIA) is studying "supply" issues, while the Technology Administration (TA) is studying "demand" issues. This conference dealt with the latter. The event was chaired by Phil Bond (Under Secretary for Technology), Kathleen Cooper (Under Secretary for Economic Affairs), and Bruce Mehlman (Assistant Secretary for Technology Policy).
Twenty-one representatives of technology companies, communications companies, and business groups participated. About 40 other persons were in attendance at the three hour event.
Some participants presented the results of surveys of businesses regarding demand for broadband services. Bruce Josten of the U.S. Chamber of Commerce presented survey results that showed that 11% of the businesses surveyed do not have Internet access, and that 55% of those that do have only dial up modem service. He concluded that "the value proposition has not yet been demonstrated to" small and medium sized businesses.
Bruce Phillips of the National Federation of Independent Businesses stated that many small businesses are not interested in broadband services. He said that it must be demonstrated to them that broadband can increase their bottom line.
In contrast, Bojana Mamuzic of SBC was more upbeat. Her company conducted a survey of 500 small businesses and found that three quarters had found that broadband had increased productivity. She argued that if industry builds broadband facilities, then "the market will follow". She cited the example of caller ID. She said that SBC's initial surveys showed that only 20% would use it, whereas, in fact, over 50% now use it.
Paul Nunes of Accenture added that there are many costs to businesses for adopting broadband services. He cited networking equipment and installation, computer equipment upgrades, storage upgrades, and employee training.
Many participants addressed applications that might drive business demand for broadband services, including teleworking, e-commerce, communications, and grid computing. Participants also referenced, but did not focus on telemedicine, distance learning, interactive gaming, and HDTV.
William Mularie of the Telework Consortium stated that the promise of telework is being under fulfilled "because of the inadequacies of our infrastructures". He pointed out that most broadband connections today provide asymmetric transfer rates, with most of the increase in speed being in the download. "Nirvana is not faster downloads," said Mularie. "Telework requires symmetric communications." He stated that he would like to see rates of 10 to 100 mbps.
Brad Allenby of AT&T focused on how telework has benefited AT&T. He said that the company saves on real estate costs, greater worker retention, and increased productivity, both in terms of hours worked, and output per hour. He added that broadband is not just a matter of speeds; it must also be convenient and "psychologically comfortable".
Chris Caine of IBM suggested that grid computing might become the killer app of broadband. Mularie stated that "the killer app is human to human communications."
Greg Wood of Internet2 stated that many applications of broadband do not yet exist. He said that the situation of broadband today is similar to that of the Internet 20 years ago, when people at DARPA were wondering what people would use the Internet for.
The conference did not focus on broadband related government policies. However, Stag Newman and others argued that state and local regulation, fees, and delays, particularly with respect to access to rights of way, are inhibiting broadband deployment. He advocated the adoption of a set of best practices by the Department of Commerce. Harris Miller of the Information Technology Association of America (ITAA) argued that the government should lead by example, such as through telework programs.
More News
3/25. The Federal Communications Commission's (FCC) reorganization went into effect. See, FCC information on reorganization.
3/25. World Intellectual Property Organization (WIPO) began a three day conference in Geneva, Switzerland, "for the purpose of preparing a strategic blueprint for the future evolution of the international patent system". See, WIPO release, conference overview and agenda.
3/25. The State Department announced that the Department of Commerce and the U.S. Trade and Development Agency will provide 20 fellowships for persons from the Andean region. The fellowships will provide "training in the use of information technologies to improve efficiency and productivity, emphasizing supply chain management and the integration of information technologies in ``back office´´ operations." See, release
Tuesday, March 26
The House and Senate are both in recess for the Spring District Work Period. Both bodies will return on Monday, April 8.
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

10:00 AM. The Progress and Freedom Foundation will hold a press conference to release a survey based report titled "Privacy Online: A Report on the Internet Practices and Policies of Commercial Websites". FTC Chairman Timothy Muris, FTC Commissioners Thomas Leary and Orson Swindle, and FTC Bureau of Consumer Protection Director Howard Beales will speak. Location: National Press Club, Holeman Lounge, 529 14th St. NW, 13th Floor.

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 (EPIC), and Jerry Cerasale (Direct Marketing Assoc.). See, online registration page. Lunch will follow the program. Location: Cato, 1000 Massachusetts Ave., NW.
12:15 PM. The FCBA'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 Location: FCC, 445 12th Street, SW, Eighth Floor, Conference Room 1.
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
Passover begins.
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 Location: Willkie Farr & Gallagher, 1155 21st Street, NW (between L & M), 6th Floor.
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 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 notice [PDF].
Friday, March 29
Good Friday.
Extended 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 (HSR) Premerger Notification Act, FTC Act, and Clayton Act. See, original FTC release and Federal Register notice, and FTC release and Federal Register notice extending deadline from March 1 to March 29.
Deadline to submit comments to the FTC regarding proposed new Privacy Act system of records. This system, if adopted, would include telephone numbers and other information pertaining to individuals who have informed the Commission that they do not wish to receive telemarketing calls. See, notice to be published in the Federal Register.
Monday, April 1
The Supreme Court of the U.S. will go on recess until Monday, April 15.
The USTR will hold a hearing regarding negotiation of a U.S. Singapore Free Trade Agreement. The USTR stated in its notice in the Federal Register that the agreement is "expected to include provisions on trade in services, investment, trade related aspects of intellectual property rights, competition, government procurement, electronic commerce, trade related environmental and labor matters, and other issues."
10:00 AM. The U.S. Court of Appeals (FedCir) will hear oral argument in Philip Jackson v. Casio PhoneMate, No. 01-1456, a patent infringement case involving telephone answering machines. The U.S. District Court (NDIll) granted summary judgment to Casio. Location: Courtroom 201, LaFayette Square, 717 Madison Place, NW.
EXTENDED TO APRIL 22. Deadline to file reply comments with the FCC in response to its notice of proposed rulemaking (NPRM) regarding the appropriate regulatory requirements for incumbent local exchange carriers' (ILECs') provision of broadband telecommunications services. The FCC adopted this NPRM at its December 12 meeting. This is CC Docket No. 01-337. See, notice in the Federal Register. See also, Order [PDF] extending deadline to April 22.
Deadline to submit written requests to participate as a panelist in the workshop to be hosted by the FTC on May 16 and 17 to explore issues relating to the security of consumers' computers and the personal information stored in them or in company databases. See, notice in Federal Register.
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