|5th Circuit Rules in Cyber
|4/3. The U.S.
Court of Appeals (5thCir) issued its opinion
v. Spider Webs, a cyber squatting case. The
Appeals Court affirmed a District Court order that a cyber
squatter transfer a domain name under the Anti- Cybersquatting
Consumer Protection Act.
Background. The Ernest
and Julio Gallo Winery holds a U.S. trademark in the name
"Ernest & Julio Gallo." Spider Webs registered
about 2,000 domain names, including ernestandjuliogallo.com.
About 300 of its registrations could be associated with
existing businesses. Spider Webs sells its domain names on its
web site, and on eBay. However, Spider Webs never offered to
sell to Gallo. Spider Webs refused Gallo's requests to
transfer the domain name. Once Gallo filed suit, Spider Webs
published a web site at this domain which it named the
"Whiney Winery" web site; it was critical of Gallo.
District Court. Gallo filed a complaint in U.S. District Court (SDTex)
against Spider Webs and several individuals alleging violation
of the Anti- Cybersquatting Consumer Protection Act (ACPA), 15
U.S.C. § 1125(d), and federal and Texas anti-dilution,
trademark infringement, and unfair competition laws. The
District Court granted summary judgment to Gallo under the
ACPA and Texas anti- dilution law, and ordered Spider Webs to
transfer the domain name to Gallo.
Statute. 15 U.S.C. § 1125(d)(1)(A) provides, in part,
that "A person shall be liable in a civil action by the
owner of a mark ... if, without regard to the goods or
services of the parties, that person (i) has a bad faith
intent to profit from that mark, including a personal name
which is protected as a mark under this section; and (ii)
registers, traffics in, or uses a domain name that -- (I) in
the case of a mark that is distinctive at the time of
registration of the domain name, is identical or confusingly
similar to that mark; (II) in the case of a famous mark that
is famous at the time of registration of the domain name, is
identical or confusingly similar to or dilutive of that mark;
or (III) is a trademark, word, or name protected by reason of
section 706 of Title 18 or section 220506 of Title 36."
The statute lists nine factors to be considered by the Court
in determining whether "bad faith" exists.
Appeals Court. Spider Webs conceded that Gallo holds a
valid trademark, and that the domain name at issue is
confusingly similar to it. The only issue on appeal was
whether Spider Webs had a "bad faith intent to
profit" within the meaning of ACPA.
The Appeals Court held that an item by item consideration of
the "bad faith" factors warranted a ruling in
Gallo's favor. One factor (VII) weighed in Spider Webs' favor
-- it did not provide false contact information when
registering the domain.
The Appeals Court also addressed factor VI, regarding
"the person's offer to transfer, sell, or otherwise
assign the domain name to the mark owner or any third party
for financial gain ..." The Appeals Court wrote that
"although Spider Webs has not offered this domain name
for sale, it has registered other domain names that are
identical or similar to the names of well- known businesses
and products, has offered other domain names for sale, and has
refused to accept less than $10,000 per name."
The Appeals Court also held that it "is not limited to
the consideration of the listed statutory factors, but can
consider other factors as well". Quoting from an earlier
trademark case involving Gallo, the Appeals Court wrote that
when "the senior user's trademark is famous in the
marketplace and where the junior user was aware of the
trademark and of its fame, a presumption of bad faith arises
from the choice of the same name because it is inferrable that
the junior user adopted the mark for the purpose of profiting
from the aura of goodwill surrounding the senior user's
mark." See, E. & J. Gallo Winery v. Gallo Cattle
Co., 12 U.S.P.Q.2d 1657, 1675 (E.D. Cal. 1989), aff'd,
967 F.2d 1280 (9th Cir. 1992).
The Appeals Court also affirmed the award of statutory damages
under the ACPA.
|FCC Grants VoiceStream's
Petition for Waiver of PAS Rules
|4/3. The Federal
Communications Commission (FCC) released its Memorandum
Opinion and Order [13 pages in PDF] granting VoiceStream Wireless
Corporation's petition for waiver of the FCC's wireless
priority access service (PAS) rules. VoiceStream filed its petition
[PDF] on November 28, 2001. The National
Communications System (NCS) supported the petition. The
FCC adopted its order on March 15, 2002, but did not release
it until April 3.
The FCC's PAS rules, at Section 64.402, permit commercial
mobile radio service (CMRS) operators to voluntarily allow
national security and emergency preparedness users in
emergencies to access the next available wireless channel to
originate a call.
The FCC granted VoiceStream a waiver "until notification
by VoiceStream or NCS that the per call invocation feature can
be commercially deployed on a global system for mobile
communications (GSM) system, upon expiration or termination of
the contract between VoiceStream and NCS, DynCorp or any other
service integrator acting on behalf of NCS, to provide a
wireless priority access capability; or by December 31, 2002,
whichever is earliest."
The waiver will allows VoiceStream to immediately deploy PAS.
FCC Commissioner Michael Copps
wrote a separate statement in which he supported the granting
of the waiver, but dissented to the extent that the FCC order
does not require service providers to disclose to their
customers the implications of the new PAS system. He wrote
that "I would therefore require any carrier that
implements a PAS to inform its customers of the creation of
the system and the impact on its customers' ability to
complete calls in an emergency. With this information our
citizens can decide which carrier they are most comfortable
with, and how much to rely on their wireless phone in an
emergency. ... We must not ``hide the ball´´ when it comes
to PAS. Consumer anger will be overwhelming if the first time
consumers learn that a PAS has reduced their chance of
completing a call is in the aftermath of an emergency. Our
citizens deserve to be fully informed ahead of time."
Commissioner Kevin Martin
echoed Copps' concerns. He did not dissent, but wrote that
"I also encourage PAS carriers to inform their customers
when they have entered into such arrangements."
See also, FCC
release. This is WT Docket No. 01-333.
|Federal Circuit Reverses in
Pickholtz v. Rainbow Technologies
|4/3. The U.S.
Court of Appeals (FedCir) issued its opinion in Pickholtz
v. Rainbow Technologies, a patent infringement
case involving claim construction.
Pickholtz is the inventor and owner of U.S.
Patent 4,593,353, titled "Software protection method
and apparatus". It describes an apparatus for the
prevention of piracy of computer software. The invention
prevents computer software on an external memory device (e.g.,
a magnetic disc) from executing on a computer unless the
software is authorized to do so.
Pickholtz filed a complaint in U.S.
District Court (NDCal) against Rainbow Technologies and
Software Security alleging patent infringement. The District
Court granted summary judgment of non-infringement. Pickholtz
The Court of Appeals reversed and remanded. The Court held
that the District Court improperly construed the terms
"computer" and "located in the computer"
to exclude peripherals.
Advocates Relief from Unbundling Requirements
|4/3. A group of six trade associations held a press
conference in Washington DC to announce the formation of a
group named the High Tech Broadband Coalition (HTBC). One
purpose of this coalition is to file a comment with the Federal Communications Commission
The HTBC will file a comment with the FCC on Friday, April 5,
advocating that the FCC refrain from imposing Section 251
unbundling obligations on new fiber and DSL facilities
deployed on the customer side of the central office. The
coalition did not make available a copy of the comment to be
filed. The unbundling requirement at issue is codified at 47 U.S.C.
The speakers at the event were Robert Holleyman (P/CEO of the Business Software Alliance),
Gary Shapiro (P/CEO of the Consumer
Electronics Association), Jerry Jasinowski (President of
the National Association of
Manufacturers), George Scalise (President of the Semiconductor Industry
Association), Matthew Flanigan (President of the Telecommunications Industry
Association), and Rhett Dawson (ITIC).
The CEA's Shapiro stated that the coalition wants to
"advance last mile broadband investment and deployment in
the United States." He added that "to get broadband
deployed, and to meet the national policy of broadband
deployment, requires that our federal government, through the
FCC, unshackle some of the regulations which are currently
affecting the deployment of broadband." He elaborated
that "the best way to reach universal adoption of
broadband is through strong broadband facilities based
competition. That is competition between cable modems,
wireline broadband, like DSL and fiber, satellite, fixed and
mobile wireless, and any other new technologies that may be
Shapiro stated that the comment would be filed in the FCC's
"triennial review of unbundling obligations". See, Notice
of Proposed Rulemaking [PDF] titled "In the Matter of
Review of Section 251 Unbundling Obligations of Incumbent
Local Exchange Carriers ...". This is CC Docket No.
01-338, announced on December 12, 2001. The FCC also announced
on the same date a separate Notice
of Proposed Rulemaking [PDF] regarding the current
regulatory requirements for incumbent local exchange carriers'
(ILECs) broadband telecommunications services. This is CC
Docket No. 01-337.
Other technology related groups criticized the HTBC's
proposals. For example, the Information
Technology Association of America (ITAA) issued a release
in which it stated that "vibrant competition rather than
special accommodations for monopoly telephone companies is in
the best interest of broadband users". Harris Miller,
President of the ITAA, stated in this release that "the
issue that the HTBC seeks to place before the Federal
Communications Commission is whether to trade
re-monopolization of the telephone markets for broadband
investment by the Bell operating companies ... That's a deal
that trades away consumer choice, investment, innovation, and
a free market."
Miller elaborated that "Congress makes the laws. The 1996
Telecom Act requires monopoly telephone companies to open
their facilities in exchange for access to new markets.
Second, the Coalition is mistaken in suggesting that the Act
gives the FCC forbearance authority. By suggesting the FCC use
such a shaky legal authority, the Coalition risks creating
considerable uncertainly to new broadband investment and the
prospect of numerous, time consuming challenges in
Executive Director, Tim Hugo, stated in a release that the
HTBC "called for the FCC to implement the core elements
1542, commonly referred to as the Tauzin Dingell broadband
legislation, as part of the agency's triennial review of the
Section 251 unbundling rules of the 1996 Telecommunications
Act. ... The 1996 Telecommunications Act was passed by
Congress, and if need be, can be amended by Congress. As the
FCC is not a legislative body, CapNet contends that the
appropriate forum for this debate is the United States
Congress, not the FCC."
|People and Appointments
|4/3. Microsoft announced that Rick
Belluzzo "will transition out of his role as
president and chief operating officer on May 1, although he
will continue to work at the company through September to
ensure a smooth transition." See, MSFT
Prezioso was named General Counsel of the Securities and Exchange Commission
(SEC). He currently is a partner in the Washington DC
office of the law firm Cleary
Gottlieb Steen & Hamilton, which he joined out of law
school in 1982. He will succeed David Becker, who will
leave the Commission on May 7, 2002. See, SEC release.
4/3. Hewlett Packard and Compaq named 150 senior managers as a
part of their merger integration. See, HP
Communications Corporation stated that "the
Securities and Exchange Commission (SEC) is conducting an
informal inquiry into its previously disclosed co-borrowing
agreements and has asked the Company to provide clarification
and related documentation." See, Adelphia
4/3. The Securities and Exchange
Commission (SEC) initiated an administrative proceeding
against David Thatcher, who was previously President and Chief
Financial Officer of Critical
Path, a provider of Internet messaging infrastructure
products and services. The SEC simultaneously issued a consent
order in which it suspended Thatcher from appearing or
practicing before the SEC as an accountant. The SEC previously
filed a civil complaint in U.S. District Court (NDCal)
against Thatcher. In that action, the SEC obtained a judgment
enjoining him from further violations of federal securities
laws, and requiring him to pay a civil penalty of $110,000.
Thatcher, among other things, materially overstated Critical
Path's revenue, and materially understated its loss, in
contravention of Generally Accepted Accounting Principles.
3/28. Mohsin Mynaf plead guilty in U.S.
District Court (EDCal) to six counts of criminal copyright
infringement, six counts of trafficking in counterfeit labels,
and one count of circumventing a technological measure that
protects a copyright work in violation of the Digital
Millennium Copyright Act. See, CCIPS
|Thursday, April 4
|The House and Senate are both in recess for the Spring
District Work Period. Both bodies will return on Monday, April
The Supreme Court of the U.S. is on recess until Monday, April
8:30 AM - 5:30 PM. Day one of a two day event hosted by the
Department of Commerce's (DOC's) National Telecommunications
and Information Administration (NTIA) titled Spectrum
Summit. The summit will address spectrum allocation and
efficiency, the spectrum requirements of new technologies, and
regulatory processes. See, NTIA
notice and notice
in Federal Register. Location: auditorium, Department of
Commerce, 1401 Constitution Ave., NW.
2:00 - 4:00 PM. There will be a meeting of the FCC's Advisory
Committee for the 2003 World Radiocommunication Conference.
notice [PDF], and notice
in Federal Register. Location: FCC, Commission Meeting Room,
Room TW-C305, 445 12th Street, SW.
4:00 PM. Dan
Burk (Professor, University of Minnesota Law School) will
give a lecture titled "Anti Circumvention Misuse".
He will review the history of the equitable misuse doctrine in
the context of patents and copyrights, and argue that the DMCA
anti circumvention right is a new form of intellectual
property that should be subject to the equitable misuse
doctrine. For more information, contact Prof. Robert Brauneis
@main.nlc.gwu.edu or (202) 994-6138. Location: The George
Washington University Law School 720 20th Street, NW.
|Friday, April 5
|8:30 AM - 4:15 PM. Day two of a two day event hosted by the NTIA
titled "Spectrum Summit". The summit will address
spectrum allocation and efficiency, the spectrum requirements
of new technologies, and regulatory processes. See, NTIA
notice and notice
in Federal Register. Location: Ronald Reagan International
Trade Center, 1300 Pennsylvania Avenue, NW.
9:00 AM. The FCC's
electronic filing systems will be shut down for maintenance
purposes. This shut down will last through 1:00 PM on April 7.
9:30 AM. The U.S. Court of Appeals
(DCCir) will hear oral argument in Global Naps Inc v.
FCC, No. 01-1192. Judges Edwards, Roger and Tatel will
preside. Location: 333 Constitution Ave. NW.
Extended deadline to submit comments to the Copyright Office in
response to its Notice of Proposed Rulemaking on "the
requirements for giving copyright owners reasonable notice of
the use of their works for sound recordings under statutory
license and for how records of such use shall be kept and made
available to copyright owners." See, original notice
in Federal Register, and extension notice
in Federal Register.
|Monday, April 8
|The House and Senate return from the Spring District Work
Period. The Senate is scheduled to meet at 3:00 PM.
9:30 AM. The U.S.
Court of Appeals (DCCir) will hear oral argument in Morris
Communications v. FCC, No. 01-1123. Judges Edwards, Tatel
and Silberman will preside. Location: 333 Constitution Ave.
|Tuesday, April 9
|4:00 PM. Margo
Bagley (Emory University School of Law) will give a
lecture titled "Patent First, Ask Questions Later:
Morality as a Statutory Component of Patentability". 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.
|Wednesday, April 10
|10:00 AM. The House
Appropriations Committee's Subcommittee on Commerce,
Justice, State, and the Judiciary will hold a hearing on the
proposed budget for FY 2003 for the FTC.
Location: Room H-309, The Capitol.
10:00 AM - 12:00 NOON. The AEI Brookings Joint Center for
Regulatory Studies will host a panel discussion titled Microsoft:
Making the Punishment Fit the Crime. The participants will
be Robert Hahn
(AEI Brookings), Robert Litan (AEI Brookings), George
Priest (Yale Law School), Steve
Salop (Georgetown Law Center), and Richard
Schmalensee (MIT Sloan School of Management). See, online registration
page. Location: Wohlstetter Conference Center, AEI, 12th
Floor, 1150 17th Street, NW.
10:30 AM. The Senate
Judiciary Committee's Subcommittee on Antitrust,
Competition, and Business and Consumer Rights will hold a
hearing titled "Dominance on the Ground: Cable
Competition and the ATT Comcast Merger". Sen. Herb Kohl (D-WI) will
12:00 NOON. The Congressional
Internet Caucus Advisory Committee will host a luncheon
panel discussion on the use of e-learning to train
workers. The scheduled participants include Sen. Conrad Burns (R-MT), Rep. Johnny Isakson
(R-GA), Jerry Berman (Internet
Education Foundation), Rich Moran (Accenture), Daniel
Greg Priest (SmartForce),
and retired Brig. Gen. Frank Anderson (Defense Acquisition University).
RSVP to RSVP@netcaucus.org
or call Danielle at 202 637-4370. Location: Reserve Officers
Association, First and Constitution Ave., NW.
|About Tech Law Journal
|Tech Law Journal publishes a free access web site and
subscription e-mail alert. The basic rate for a subscription
to the TLJ Daily E-Mail Alert is $250 per year. However, there
are discounts for entities with multiple subscribers. Free one
month trial subscriptions are available. Also, free
subscriptions are available for law students, journalists,
elected officials, and employees of the Congress, courts, and
executive branch, and state officials. The TLJ web site is
free access. However, copies of the TLJ Daily E-Mail Alert and
news items are not published in the web site until one month
after writing. See, subscription
Contact: 202-364-8882; E-mail.
P.O. Box 4851, Washington DC, 20008.
Copyright 1998 - 2002 David Carney, dba Tech Law Journal. All