| House Committee Holds
Hearing on USPTO Budget and Operations |
4/11. The House
Judiciary Committee's Subcommittee on Courts, the
Internet, and Intellectual Property held an oversight hearing
titled "The U.S. Patent
and Trademark Office: Operations and Fiscal Year 2003
Budget".
Members of the Subcommittee and witnesses from the American Intellectual Property
Law Association (AIPLA), the Intellectual
Property Owners Association (IPO), and an employees' union
used the occasion to criticize the continuing diversion of
USPTO user fees to fund other government programs.
Rep. Howard Coble
(R-NC), the Chairman of the Committee, said in his opening
statement that "it pains me that we must continue to
address the ongoing diversion of agency funds to other
government programs." He added that "I am a realist,
and realistically speaking, I do not believe that the
appropriators will cede their authority to control PTO funding
in the near future."
Rep. Zoe Lofgren
(D-CA) stated that this amounts to a tax on invention. She
added that "taxing the engine for the economy is a crazy
thing to do." Rep.
Darrell Issa (R-CA) questioned whether "it would be
inappropriate to tax a constitutional obligation of
government."
Rep. John Conyers
(D-MI), the ranking Democrat on the full Committee, did not
attend the hearing, but submitted a statement
for the record. He stated that "the PTO takes no money
from taxpayers; instead, it is fully funded by user fees and
generates approximately $1 billion per year in revenues from
those fees. This success has been an Achilles’ heel –
appropriators take advantage of the revenues and treat the PTO
as a cash cow, diverting hundreds of millions of dollars of
fees every year for other government programs. That diversion
is making it exceedingly difficult for the PTO to hire or even
retain qualified examiners."
The AIPLA's Michael Kirk stated in his prepared
testimony that "To date, approximately $700,000,000
in patent and trademark fees paid by USPTO users have been
diverted from, rescinded, or made unavailable to the USPTO.
The result is that longer delays in obtaining protection for
valuable new technologies and marketing efforts are increasing
the uncertainty in the marketplace, and are diminishing the
value of the rights ultimately obtained."
Rep. Howard Berman
(D-CA), the ranking Democrat on the Subcommittee, introduced
humor into the discussion. He questioned USPTO Director James Rogan
about the diversion of fees. Rogan, a Republican, was a member
of the Subcommittee until he lost his re-election bid in 2000.
Rep. Berman, a Democrat, asked Rogan whether the diversion of
fees violates the Republican
Contract with America. Rogan responded: "Thank you
for asking that question."
Rogan offered the following explanation of the
administration's FY2003 budget proposal for the USPTO in his prepared
testimony: "It would give the USPTO the largest
increase in its funding history. The President’s budget
request would allow us to spend $1.365 billion of the fee
revenues we expect to generate, an increase of $237 million or
21.2% over the FY 2002 enacted level. Of the $1.527 billion in
revenues we expect to collect next year, $1.265 billion will
be available to us in FY 2003. In addition, we will have
access to $100 million carried forward from FY 2002. In
effect, the President’s budget provides the USPTO with the
equivalent of 100 percent of our traditional fees, plus an
additional $45 million. This additional funding will enable us
to: (1) hire 950 patent examiners; (2) transform trademarks to
a fully electronic operation by 2004; and (3) implement the
President's management agenda, including e-government,
outsourcing, and workforce restructuring. In order to fund the
USPTO's and the President's priorities, the budget request
includes a one-time surcharge on both patent and trademark
fees that will generate an additional $207 million in FY 2003.
A 19.3 percent surcharge will apply to all patent statutory
fees, including the filing, issue, maintenance, extension,
appeal and revival fees. Discounted fee rates for
independent inventors and small businesses will remain in
effect. For trademarks, a 10.3 percent surcharge will apply to
the initial filing and post registration fees."
The hearing also focused on reducing patent pendency,
improving patent quality, attracting and retaining patent
examiners, electronic filings, and the possibility of
converting the USPTO into a government corporation. See also,
prepared testimony of Colleen
Kelley (National Treasury Employees Union) and John
Williamson (IPO). |
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| EMC Sues Hitachi for Patent
Infringement |
| 4/12. EMC Corporation
filed a complaint
[PDF] in U.S. District
Court (DMass) against Hitachi
alleging patent infringement. EMC, a Massachusetts based
provider of storage systems, software and services, alleges in
its complaint that Hitachi infringed its U.S. Patent Nos.
6,101,497, 6,092,066, 5,544,347, 5,742,792, 5,909,692, and
6,108,748, which pertain to EMC's Symmetrix Remote Data
Facility (SRDF) and TimeFinder software products, data
migration, and the storage of mainframe data. EMC also filed a
complaint [PDF]
with the U.S. International
Trade Commission. See also, EMC
release. |
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| USTR Zoellick Addresses IPR
and IT in China |
4/10. U.S. Trade
Representative (USTR) Robert
Zoellick held a press conference in Beijing, China, in
which he addressed intellectual property rights (IPR),
information technology, and other topics. See, transcript.
Regarding IPR, he had this to say. "But there's still a
long way to go. One of the other points I've tried to make in
this -- and this gives you a feel for the conversations I'm
trying to have with people -- is that IPR is critically linked
to investment because most companies coming in these days are
now in knowledge industries. So, if you want to continue to be
a location that draws foreign investment -- and that's the
other thing you can see how they're using foreign business
participation to help increase competitiveness -- it's in
their own interest to do this. And then on top of that you
take a society like China where I suspect that its
intellectual property development is going to be pretty high,
whether it be in software or other areas, and it's in their
own interest. So, the idea is to share how it's in their
self-interest to take action, but obviously to recognize that
this is a problem that still needs a lot of work."
He also stated that "China has been trying to become a
member of the Information Technology Agreement and it's very
close to doing so. They had some restrictions on the ability
to import IT products through requirements for end-user
approval. We think we can work those out." |
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| FCC Issues Order on Remand
in CALEA Proceeding |
4/11. The Federal
Communications Commission (FCC) released an Order
on Remand [59 pages in PDF] in the proceeding titled
"In the matter of Communications Assistance for Law
Enforcement Act". This is CC Docket No. 97-213. The order
was adopted on April 5, but not released until April 11.
The Congress passed the CALEA
in 1994 to allow law enforcement authorities to maintain their
wiretap capabilities in new telecom devices, by requiring
carriers to make their wireline, cellular, and broadband PCS
equipment capable of certain surveillance functions. In August
1999 the FCC issued an Order implementing and expanding the
requirements placed on carriers. Several parties filed
Petitions for Review. On August 15, 2000 the U.S. Court of Appeals
(DC Cir.) released its opinion
vacating parts of the FCC order, and remanding the matter to
the FCC. See, USTA v. FCC, 227 F.3d 450. |
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| Trade Promotion Authority |
| 4/11. Deputy Treasury Secretary Kenneth Dam released a statement
regarding trade promotion authority. He stated that "One
week ago, President Bush made a major statement calling on the
United States Senate to bring Trade Promotion Authority (TPA)
to the Senate floor by April 22. ... We view Trade Promotion
Authority -- the ability for the executive branch to negotiate
the details of trade agreements and then submit them to
Congress for approval in a simple up or down vote as an
essential legislative component of our free trade
strategy." |
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|
| SEC Sues Xerox for
Financial Fraud |
4/11. The Securities and
Exchange Commission (SEC) filed a civil complaint
in U.S. District Court (SDNY)
against Xerox alleging
that Xerox "defrauded investors" in violation of
federal securities laws. The complaint states that "In a
scheme directed and approved by its senior management, Xerox
disguised its true operating performance by using undisclosed
accounting maneuvers -- most of which were improper -- that
accelerated the recognition of equipment revenue by over $3
billion and increased earnings by approximately $1.5
billion." The SEC also announced that it simultaneously
entered into a settlement agreement with Xerox.
The complaint states that Xerox used "one-time
actions," "one-offs," "accounting
opportunities" and "accounting tricks". It
states that "Xerox falsely portrayed itself as a business
meeting its competitive challenges and increasing its earnings
every quarter. Many of these accounting actions violated the
established standards of generally accepted accounting
principles (``GAAP´´). All of them should have been
disclosed to investors in a timely fashion because, singly and
collectively, they constituted a significant departure from
Xerox's past accounting practices and misled investors about
the quality of the earnings being reported."
Count 1 of the complaint alleges fraud in violation of Section
17(a) of the Securities Act and Section 10(b) of the Exchange
Act and Rule 10b-5 thereunder. Count 2 alleges violation of
Section 13(a) of the Exchange Act and Exchange Act Rules
13a-1, 13a-13, and 12b-20, regarding the filing with the SEC
of annual and quarterly reports. Count 3 alleges violation of
Section 13(b) of the Exchange Act and Exchange Act Rule
13b2-1, regarding the keeping of books, records, and accounts.
The complaint requests an injunction against further violation
of federal securities laws, an order requiring Xerox to
restate its financial results for the periods 1997 through
2000, and an order "requiring Xerox's Board of Directors
to appoint a special committee comprised entirely of outside
directors which, within 30 days after the entry of such order,
shall retain a qualified consultant, not unacceptable to the
Commission, to perform a complete review of Xerox's material
internal accounting controls and policies. ..."
The SEC also announced that "Without admitting or denying
the allegations of the complaint, Xerox consented to the entry
of a Final Judgment that permanently enjoins the company from
violating the antifraud, reporting and recordkeeping
provisions of the federal securities laws ... . In addition,
Xerox agreed to pay a $10 million civil penalty and to restate
its financial results for the years 1997 through 2000.
Xerox also agreed to have its board of directors appoint a
committee composed entirely of outside directors to review the
company's material internal accounting controls and
policies." See. SEC
release.
Anne Mulcahy, Xerox Chairman and CEO, stated in a release
that "The settlement with the Commission effectively
resolves Xerox's outstanding issues with the SEC ... Xerox
today is a stronger company with a new management team that
has taken all the right steps to turn our business around.
With the SEC matters now behind us, we are better positioned
to continue fortifying our business through operational
improvements and future growth opportunities -- creating
enhanced value for our customers and shareholders." |
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| Ways and Means Committee
Holds Hearing on Trade Relations with Russia |
4/11. The House
Ways and Means Committee's Subcommittee on Trade held a
hearing on normal trade relations with Russia.
Peter Allgeier, a Deputy U.S. Trade Representative, stated in
his prepared
testimony that "A key part of Russia's broader
economic reform program is achieving membership in the World Trade Organization (WTO).
President Putin has made WTO membership and integration into
the global trading system a top priority, seeing this as part
of Russia's economic reform program that is aimed at achieving
sustainable growth, promoting high tech industry, attracting
international investment, and raising living standards for the
Russian people."
Allgeier continued that, "Of course, intensifying our
efforts to work with Russia on WTO accession does not mean
that we will welcome Russia's entry into the WTO on any terms.
We are negotiating with Russia to increase market access for
U.S. exports -- in goods, services and agriculture -- and we
will work with other WTO members and the Congress to ensure
that the Russian Government implements the many rules of the
WTO. Russia must follow through with its stated plans to make
comprehensive changes to its legal and regulatory system in a
number of areas ... protection of intellectual property. Some
of these changes are already underway, but it is up to the
Russian Government to pass new laws and ensure that the laws
in place are fully enforced in a manner consistent with the
international trading system."
He also stated that "In the services area, we are
continuing to push hard for increased access in
telecommunications, distribution and financial services."
Allgeier also addressed Jackson Vanik. He sated that "To
close out the history books of the Cold War, the President has
urged the Congress to finally end Jackson Vanik's application
to Russia. The Jackson Vanik Amendment was drafted
twenty-eight years ago to bring about free emigration. We
believe that the Amendment has served this purpose in Russia
-- Russia has been in full compliance with Jackson Vanik's
emigration provisions since 1994. Continued application of
Jackson Vanik, however, is an indication to Russia that they
continue to be suspect and viewed as a Cold War
adversary."
Alan Larson, Under Secretary of State for Economic, Business,
and Agricultural Affairs, also testified in support of
terminating the application of Jackson Vanik amendment of the
1974 Trade Act to Russia. See, prepared
testimony.
Rep. Tom Lantos
(D-CA) also testified in support of "graduating the
Russia Federation from the provisions of the Jackson Vanik
Amendment and granting it Permanent Normal Trade Relations (PNTR)."
See, prepared
testimony.
See also, prepared testimony of other witnesses: Thomas
Pickering (U.S. Russia Business Council), Robert
Liuzzi (Ad Hoc Committee of Domestic Nitrogen Producers), Wayne
Wood (American Farm Bureau Federation), Harold
Luks (NCSJ), and Richard
Edlin (Greenberg Traurig). |
|
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| Senate Judiciary Committee
Holds Hearing on Judicial Nominees |
4/11. The Senate
Judiciary Committee held a hearing on several pending
judicial nominees: Jeffrey Howard (to be a judge of the U.S.
Court of Appeals for the First Circuit), Percy Anderson (U.S.D.C.,
Central District of California), John Walter (U.S.D.C.,
Central District of California), Michael Baylson (U.S.D.C.,
Eastern District of Pennsylvania), William Griesbach (U.S.D.C.,
District of Wisconsin), Joan Lancaster (U.S.D.C., District of
Minnesota), and Cynthia Rufe (U.S.D.C., Eastern District of
Pennsylvania).
These nominees received bipartisan praise from members of the
Committee, and from Senators and Representatives who came to
testify on their behalf.
Jeffrey Howard is a former U.S. Attorney for New Hampshire,
former New Hampshire Attorney General, and failed
gubernatorial candidate. Michael Baylson, who has been
nominated for the Eastern District of Pennsylvania, is a
partner in the law firm of Duane Morris. He
represented GTE and Bell Atlantic in merger related
proceedings before the Pennsylvania Public Utility Commission.
The merged entity is now named Verizon.
John Walter, one of the two nominees for the Central District
of California (Los Angeles), is a partner with the law firm of
Walter Finestone & Richter. The other, Percy Anderson, is
a partner with the law firm of Sonnenschein Nath &
Rosenthal.
Sen. Orrin Hatch
(R-UT), the ranking Republican on the Committee, also used the
hearing to criticize delays by the Democratic majority in
confirming President Bush's nominees. "The Committee's
unwillingness to move more expeditiously on these nominations
is exacerbating the circuit court vacancy crisis that exists
in America today. Nearly one in five circuit court seats is
vacant". |
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| Friday, April 12 |
The House will not be in session.
The Supreme Court of the U.S. is on recess until Monday, April
15.
10:00 AM - 12:00 NOON. The American
Enterprise Institute (AEI) will hold a panel discussion
titled Is Open Source the Future of Software? The
participants will be Robert Hahn (AEI
Brookings), James
Bessen (Research on Innovation), David
Evans (NERA), Lawrence
Lessig (Stanford University), and Brad Smith (Microsoft).
See, AEI online
registration page. Location: 1150 17th St., NW.
10:00 AM - 12:00 NOON. The National
Commission on Libraries and Information Science (NCLIS)
will hold an open business meeting. See, notice
in Federal Register. Location: Conference Room, NCLIS Office,
1110 Vermont Avenue, NW, Suite 820.
The Federal Communications Bar
Association (FCBA) will host a luncheon. The speaker will
be Nancy
Victory, Director of the NTIA. RSVP to Wendy Parish at
wendy @fcba.org by
Tuesday, April 9, at 5:00 PM.
Deadline to submit comments to the Federal Communications Commission
(FCC) regarding its annual report to Congress regarding
progress made in achieving the objectives of the Open Market
Reorganization for the Betterment of International
Telecommunications Act (ORBIT Act), 47 U.S.C. § 646. The next
FCC Orbit Act report is due to Congress on June 15, 2002. See,
FCC
notice [PDF]. |
|
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| Monday, April 15 |
| Extended deadline to submit comments to the Federal Trade Commission (FTC)
regarding proposed changes to its Telemarketing Sales Rule (TSR).
See, notice
in Federal Register. See also, FTC release. |
|
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| Tuesday, April 16 |
9:30 AM. The Senate
Commerce Committee will hold a hearing to examine the Technology Administration
and the National Institute of
Standards and Technology (NIST), including the Advanced
Technology Program. Location: Room 253, Russell Building.
10:00 AM. The Senate
Health, Education, Labor, and Pensions Committee will hold
a hearing to examine medical privacy issues. Location:
Room 216, Hart Senate Office Building.
6:00 - 8:15 PM. The Federal
Communications Bar Association (FCBA) will host a CLE
seminar titled U.S. Spectrum Policy: Convergence or
Co-Existence? This is Part II of a two part series.
6:30 - 8:30 PM. The IP Law Forum of the Women's Bar
Association of DC and the IP Section of the District of
Columbia Bar will host a panel discussion and reception titled
"What Judges Want: Effective Advocacy in Technology
Cases". The speakers will be Judge Paul Michel of the U.S. Court of Appeals (FedCir),
Judge Yvette Kane of the U.S. District Court (WDPenn), and
Judge Marvin Garbis of the U.S. District Court (DMd). The
price to attend is $40. For more information, contact the WBA
at 202 639-8880. Location: Auditorium, The Hirshhorn Museum,
7th Street and Independence Ave., SW. |
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| Wednesday, April 17 |
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 Securities and Exchange Commission
(SEC). Location: Room H-309, The Capitol.
2:00 PM. 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 Federal Communications Commission
(FCC). Location: Room H-309, The Capitol.
9:00 AM. Oral argument on cross motions for summary judgment
in Swedenburg
v. Kelly, a constitutional challenge by a Virginia winery
and wine consumers to New York State's liquor control law,
which prohibits out of state wineries from selling directly to
New York residents, including via the Internet. Location: U.S.
District Court, Southern District of New York, New York, NY.
9:30 AM - 12:00 NOON. The U.S. International
Telecommunication Advisory Committee (ITAC), which advises
the Department of State on
policy and technical issues with respect to the International Telecommunication
Union (ITU), will meet to prepare for the June 2002
meeting of the Telecommunication Sector Advisory Group (TSAG).
Location: Alliance for
Telecommunications Industry Solutions (ATIS), 1200 G
Street NW, Suite 350.
10:00 AM. The FEC will hold a
hearing regarding voting system standards. See, notice
in Federal Register.
12:15 PM. The FCBA's
Mass Media Committee will host a brown bag lunch. The speaker
will be Jane Mago, FCC General Counsel. RSVP to: kdole @npr.org. Location: 1st
Floor, NPR, 635 Mass Ave., NW, Washington DC.
12:15 PM. The FCBA's
Online Communications Committee will host a brown bag lunch.
The speaker will be Scott
Marcus, Senior Advisor for Internet Technology at the Federal Communications Commission's
(FCC) Office of Plans and
Policy. The title will be "Broadband, When? -- A View
from OPP". RSVP to Scott Harris at sharris@harriswiltshire.com.
Location: Wiley Rein &
Fielding, 1776 K St., NW, 4th Floor Conference Room.
2:00 - 3:00 PM. The FCBA's
International Practice Committee will host an event titled
"Today's International Issues". The speaker will be FCC
Commissioner Michael
Copps. RSVP to Scott Harris.
Location: FCC, 445 12th Street, SW. |
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| Thursday, April 18 |
8:30 AM. Rep.
Joe Knollenberg (R-MI) will speak at a breakfast hosted by
the Greater Washington Board of Trade's Federal PAC and CapNet. RSVP to either JaimeHjort @bot.org or
202 857-5909. Location: Greater Washington Board of Trade
Board Building, 1129 20th Street, NW, Suite 200.
8:30 AM - 4:00 PM. The Progress
and Freedom Foundation will host an event titled
"Digital Online Content: Creating a Market that
Works". James
Rogan, Undersecretary of Commerce for Intellectual
Property, will speak. Location: J.W. Marriott Hotel, 1331
Pennsylvania Ave, NW.
9:30 AM. The FCC will hold a
meeting. See, agenda.
Location: FCC, 445 12th Street, SW, Room TW-C05 (Commission
Meeting Room).
9:30 AM - 12:00 NOON. The American
Enterprise Institute (AEI) will host a pair of panel
discussions titled "Gene Related Inventions: Evolving
Patent Standards and Their Consequences". The first panel
will address "Science, Economics, and Patent Law".
The panelists will be Lee Bendekgey (Incyte Genomics), Iain Cockburn
(Boston University), and Rochelle Seide (Baker Botts). The
second panel will be titled "Perspectives from the
Patents and Trademark Office and Capitol Hill". The
panelists will be John Doll (USPTO),
Chris Katopis (House Subcommittee on Courts, the Internet, and
Intellectual Property), Maureen Mellody (office of Rep. Howard Berman
(D-CA)), and Gerald
Mossinghoff (Oblon, Spivak). See, agenda and online
registration page. Location: 12th Floor, AEI, 1150 17th
Street, NW.
Day one of a two day ALI-ABA
course for inside and outside counsel titled "Trademarks,
Copyrights, and Unfair Competition for the General
Practitioner and the Corporate Counsel". The price to
attend is $685. See, online brochure.
Location: Loews L'Enfant Plaza.
Day one of a two day conference titled "IT Law and the
Response to Terror: New Laws, Rules and Strategies". The
event is hosted by the Computer
Law Association and the FCBA. See,
online brochure
[PDF]. Location: Monarch Hotel, 2401 M Street NW. |
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