Tech Law Journal Daily E-Mail Alert
April 25, 2002, 9:00 AM ET, Alert No. 418.
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Trade Promotion Authority Proponents Press for Senate Vote
4/24. President George Bush gave a speech at the Dakota Ethanol Plant in Sioux Falls, South Dakota, in which he advocated passage of legislation giving the President trade promotion authority. TPA, which is also known as fast track, gives the President authority to negotiate trade agreements which can only be voted up or down, but not amended, by the Congress. TPA strengthens the bargaining position of the President.
The House passed its version of the TPA bill, HR 3005, the Bipartisan Trade Promotion Authority Act of 2001, by a roll call vote of 215 to 214 on December 6, 2001. See, TLJ Daily E-Mail Alert No. 323. The Senate Finance Committee passed its version of this bill later in December. Sen. Tom Daschle (D-SD), the Senate Majority Leader, has yet to bring the bill to the Senate floor for a vote.
President Bush traveled to Sen. Daschle's home state to make press the issue. President Bush stated that "I understand that the Senate is getting to take up a trade bill, for which I'm grateful. I look forward to getting that bill to my desk. It's important to get it passed and to get it moving. And it's important to get a farm bill to my desk, as well. We need good farm legislation. It's -- the farm bill needs to get done quickly so that the farmers who are out there fixing to plant know what the rules of the game is. And we can do it. We need to put aside all the posturing, all the noise, and for the good of American agriculture, get a trade bill to my desk and get a farm bill to my desk."
Sen. Daschle attended the event.
Meanwhile, back in Washington DC, the Senate Republican High Tech Task Force held a press conference. Sen. George Allen (R-VA), Sen. Don Nickles (R-OK), Sen. Bob Bennett (R-UT), Treasury Secretary Paul O'Neill, and technology company representatives urged quick passage of a TPA bill.
Sen. Allen stated that TPA is "a high priority for the technology sector" which is dependent upon exports. He observed that of the 150 regional trade agreements worldwide, the U.S. is a party to only three. He pointed out, for example, that Brazil imposes a 35% tariff on many telecommunications products, and a 19% tariff on many computer products.
Sen. Bennett related that he occupies the Senate seat once held by Sen. Reed Smoot. He discussed the role of the 1930 Smoot Hawley tariff in creating and spreading the depression of the 1930s. He concluded that he wants to pass TPA so that Smoot can rest in peace.
Secretary O'Neill said that "we need the high paying jobs that come with technology trade."
Also on April 24, Secretary O'Neill testified before the House Appropriations Committee's Subcommittee on Foreign Operations, Export Financing and Related Programs. He said in his prepared testimony that "I applaud the House of Representatives for approving Trade Promotion Authority (TPA), and the Senate Finance Committee for its strong bipartisan vote in favor of TPA legislation. You have done a great service to our economy. It is now imperative that the full Senate acts quickly so the Congress can approve a final version of TPA and send it to the President for his signature. This would provide a great service to our economy. Passage of TPA will substantially enhance our ability to help complete the Free Trade Area of the Americas, other free trade agreements, and our broader multilateral trade agenda. And without question, TPA will be a great confidence builder for the U.S. and global economy."
On April 23, Rep. John Baldacci (D-ME) introduced HR 4550, another bill to amend the eligibility requirements of the trade adjustment assistance (TAA) program under the Trade Act of 1974. The bill was referred to the House Ways and Means Committee.
House Judiciary Committee Approves Wiretap Bill
4/24. The House Judiciary Committee held a meeting to mark up several bills. It amended and approved HR 1877, the Child Se_ Crimes Wiretapping Act of 2001. This bill would expand the list of predicate offenses that may serve as the basis for the issuance of a wiretap order. Rep. Lamar Smith (R-TX) stated that the bill "will assist law enforcement officers in investigating se_ crimes that involve children." Rep. Bobby Scott (D-VA) called it "an unnecessary expansion of federal wiretap authority". The bill passed by a vote of 20 to 4.
House Judiciary Committee Postpones Mark Up of Tech Bills
4/24. The House Judiciary Committee once again postponed its mark up of HR 3482, the Cyber Security Enhancement Act of 2001 (a crime bill), and HR 3215, the Combatting Illegal Gambling Reform and Modernization Act (a bill that would affect Internet gambling). Mark up of both bills is likely to be rescheduled for next week. The reasons for the postponements has been lack of time to complete all agenda items.
FRB Vice Chairman Addresses Role of High Tech in the Economy
4/24. Federal Reserve Board Vice Chairman Roger Ferguson testified before the House Small Business Committee. He stated in his prepared testimony that "prospects for a renewed expansion have now brightened significantly. The economy appears to have been expanding at a significant pace in recent months." He also addressed the role of technology in the overall economy.
He stated that "overall economic activity had slowed noticeably after several years of rapid expansion. The economic boom that preceded the slowdown had been marked by an exceptionally high rate of investment in high technology equipment and software ..."
He then elaborated on the role of technology. "What looked at the outset to be a gradual cooling of an overheated economy became much more serious -- particularly in the manufacturing sector -- for several reasons. First, the shakeout in the high tech sector proved to be not simply an adjustment to slower domestic demand but a more fundamental reassessment by businesses, globally, of the profitability of additional fixed capital added to the already high stock of such capital. Besides the plunge in demand for high tech products, our exports were hit hard by the slowdown in economic growth abroad. Lastly, the shock to confidence and spending in the wake of the tragic events of September 11 extended the weakness in the economy that had emerged over the first half of the year."
"Although the weakness in the manufacturing sector from mid-2000 through the end of last year was widespread, the global plunge in high tech investment stands out as a significant drag. After having climbed at a rate of more than 35 percent per year in 1999 and 2000, our output of high tech products -- computers, communications equipment, and semiconductors -- contracted at an annual rate of 21-1/2 percent between December 2000 and September 2001; capacity utilization in this group of industries fell from 81 percent to just under 61 percent in the fourth quarter of last year," said Ferguson.
Greenspan Discusses Economic Consequences of Info Tech and Conceptual Assets
4/22. Federal Reserve Board Chairman Alan Greenspan gave a speech via video conference to the Institute of International Finance, in New York City. He offered a tentative assessment of some of the economic consequences of the use of information technologies, and the shift from an economy based upon physical assets to one based upon information assets. Information technology may make the economy more resilient, and make cyclical episodes less severe. However, an economy based upon "conceptual assets" encounters new vulnerabilities, said Greenspan.
He first stated that "because of increased access to real time information and, more arguably, extensive deregulation and innovation in financial and product markets, economic imbalances are more likely to be readily contained. As a consequence, cyclical episodes overall should be less severe than they otherwise would be."
He continued that "If this is indeed the situation -- and it must be considered speculative until more evidence is gathered -- the implied reduction in economic volatility, other things being equal, would lower risk and equity premiums."
However, he also cautioned that "The very technologies that appear to be the main cause of our apparent increased flexibility and resilience may also be imparting different forms of vulnerability that could intensify or be intensified by a business cycle."
Greenspan reasoned that "the ever increasing proportion of our GDP that represents conceptual, as distinct from physical, value added may actually have lessened cyclical volatility. In particular, the fact that concepts cannot be held as inventories means a greater share of GDP is not subject to a type of dynamic that amplifies cyclical swings."
"But an economy in which concepts form an important share of valuation has its own vulnerabilities. As the recent events surrounding Enron have highlighted, a firm is inherently fragile if its value added emanates more from conceptual than from physical assets. A physical asset, whether an office building or an automotive assembly plant, has the capability of producing goods even if the reputation of its managers falls under a cloud."
Rep. Tauzin Introduces Bill to Postpone 700 Mhz Auctions
4/24. Rep. Billy Tauzin (R-LA) introduced HR 4560, the Auction Reform Act of 2002, a bill that would require that "The Federal Communications Commission shall not commence or conduct auctions 31 and 44 on June 19, 2002". These auctions pertain to spectrum in the 700 megahertz band.
The bill recites that "Circumstances in the telecommunications market have changed dramatically since the auctioning of spectrum in the 700 megahertz band was originally mandated by Congress in 1997, raising serious questions as to whether the original deadlines, or the subsequent revision of the deadlines, are consistent with sound telecommunications policy and spectrum management principles."
The bill also states that "No comprehensive plan yet exists for allocating additional spectrum for third- generation wireless and other advanced communications services. The Federal Communications Commission should have the flexibility to auction frequencies in the 700 megahertz band for such purposes."
Rep. Tauzin stated in a release that "It is true that the auction of the upper portion of the 700 MHz band has been delayed five times; conducting the auctions for both the upper and lower parts of the 700 MHz band in June would be wrong. These auctions are simply not ready for prime time."
Rep. Tauzin is the Chairman of the House Commerce Committee. The bill is cosponsored by Rep. John Dingell (D-MI), the ranking Democrat on the Committee, Rep. Fred Upton (R-MI), Chairman of the Telecom and Internet Subcommittee, Rep. Ed Markey (D-MA), the ranking Democrat on the Subcommittee, and 48 other members of the House Commerce Committee.
Also on April 24, the Cellular Telecommunications & Internet Association (CTIA) filed an Application for Review with the FCC requesting that it review the Wireless Telecommunications Bureau's recent denial of the CTIA's request for delay of the auctions.
On April 18, Commerce Secretary Donald Evans wrote a letter to FCC Chairman Michael Powell requesting that the auctions be delayed.
FTC Sues Deceptive Spammers
4/24. The Federal Trade Commission (FTC) announced that on March 27 it filed a complaint [17 pages in PDF] under seal in the U.S. District Court (DNev) against several entities and individuals alleging violation of the Federal Trade Commission Act and the Pay Per Call Rule, which was promulgated pursuant to the Telephone Disclosure and Dispute Resolution Act.
The complaint states that the defendants sent spam e-mail messages claiming that consumers had won a free Sony PlayStation 2 or other prize through a promotion purportedly sponsored by Yahoo, and then routed consumers to an adult Internet site via a 900 number modem connection that charged them up to $3.99 a minute.
This District Court issued an injunction, and an order for seizure of assets. See, Temporary Restraining Order [PDF 861KB].
Federal Circuit Rules in Fantasy Sports Patent Case
4/24. The U.S. Court of Appeals (FedCir) issued its opinion in Fantasy Sports Properties v. Sportsline.com, a patent infringement case regarding U.S. Patent 4,918,603, titled "Computerized Statistical Football Game".
Fantasy Sports Properties (Fantasy) is the assignee of the 603 patent which discloses a method of and apparatus for playing a fantasy football game on a computer. Fantasy filed a complaint in U.S. District Court (EDVa) against Sportsline.com, Yahoo, and ESPN/Starwave Partners alleging that their computerized fantasy football games infringe Fantasy's patent. The District Court granted summary judgment of non-infringement.
Claim 1 of the 603 patent reads as follows: "A computer for playing football based upon actual football games, comprising: means for setting up individual football franchises; means for drafting actual football players into said franchises; means for selecting starting player rosters from said actual football players; means for trading said actual football players; means for scoring performances of said actual football players based upon actual game scores such that franchises automatically calculate a composite win or loss score from a total of said individual actual football players' scores; said players' scores are for quarterbacks, running backs and pass receivers in a first group and kickers in a second group; and wherein said players in said first and second groups receive bonus points."
The Court of Appeals affirmed the District Court's judgment as to Yahoo and ESPN. However, the Appeals Court found that there exists a genuine issue of material fact as to whether SportsLine's Commissioner.com product infringes the 603 patent. It vacated and remanded on that issue.
9th Circuit Rules on Unclean Hands Defense In Trademark Litigation
4/24. The U.S. Court of Appeals (9thCir) issued its opinion [PDF] in Japan Telecom v. Japan Telecom America, a trademark case involving the defense of unclean hands.
Background. Japan Telecom (JT), a California corporation that is the subsidiary of a small Japanese corporation, has long sold and installed telephone and computer networking equipment in the Los Angeles area. Recently, Japan Telecom America (JTA), the U.S. subsidiary of a large telecommunications company in Japan, began selling telecommunications transmission services, including both long distance telephone and data.
District Court. JT filed a complaint in U.S. District Court (CDCal) against JTA alleging trademark infringement, unfair competition, and other claims. The District Court granted summary judgment to JTA on all claims, holding that JT had unclean hands. It reasoned that JT had unclean hands because the name by which plaintiff calls itself is deceptive; that is, the trade name "Japan Telecom" suggests a company of Japanese origin, and hence the name is geographically deceptively misdescriptive.
Court of Appeals. The Appeals Court reversed the District Court's ruling regarding unclean hands. It wrote that "Using the name of a country in a trade name does not automatically make the trade name geographically descriptive." Rather, it could be understood by consumers to be a reference to an ethnic community to which a business caters.
More News
4/24. The Office of the U.S. Trade Representative (USTR) published a notice in the Federal Register regarding the U.S. complaint to the World Trade Organization (WTO) regarding Mexican government's protectionist measures affecting telecommunications services. The USTR requests public comments from the public regarding the WTO proceeding by May 25, 2002. On April 17 the Dispute Settlement Body (DSB) of the WTO established a dispute settlement panel to examine U.S. claims regarding certain Mexican Government measures affecting basic telecommunications services and the consistency of such measures with Mexico's commitments under the General Agreement on Trade in Services (GATS). See, Federal Register, April 24, 2002, Vol. 67, No. 79, at Pages 20195 - 20196.
4/24. The Internal Revenue Service (IRS) published a pair of notices in the Federal Register containing changes to its regulations that are designed to eliminate regulatory impediments to the electronic filing of Form 1040. See, notice at Federal Register, April 24, 2002, Vol. 67, No. 79, at Pages 20028 - 20032, and notice at Federal Register, April 24, 2002, Vol. 67, No. 79, at Pages 20072 - 20074.
Correction
The TLJ Daily E-Mail Alert for April 24 stated that "The House Appropriations Committee's Subcommittee on Commerce, Justice, State, and the Judiciary held a hearing on the proposed budget for FY 2003 for the U.S. Patent and Trademark Office (USPTO)." In fact, the hearing was titled "Intellectual Property Protection", and did not focus on the USPTO's appropriation.
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Thursday, April 25
The House will meet at 10:00 AM for legislative business.
9:00 AM - 5:30 PM. Day one of a two day Copyright Conference hosted by the USPTO, the purpose of which is to "discuss current domestic and international issues vital to the development of e-commerce with members of the business and intellectual property communities." See, USPTO notice. Registration is required. Registration closed on April 19. Location: The Academy for Educational Development Conference Center, 1825 Connecticut Ave., NW, 8th Floor.
9:00 AM. Day two of a two day meeting of the Bureau of Export Administration's Information Systems Technical Advisory Committee (ISTAC). The ISTAC advises the Office of the Assistant Secretary for Export Administration on technical questions that affect the level of export controls applicable to information systems equipment and technology. The meeting will be open to the public in part, and closed to the public in part. The open agenda includes a presentation on web based remote hardware management, a presentation on microelectro- mechanical (MEMS) technology and applications, and a presentation on battery and fuel cell technology. See, notice in Federal Register. Location: Herbert Hoover Building, Room 3884, 14th Street between Pennsylvania Ave. and Constitution Ave., NW.
9:30 AM. The Senate Commerce Committee will hold a hearing on S 2201, the Online Personal Privacy Act, sponsored by Sen. Ernest Hollings (D-SC). Location: Room 253, Russell Building.
10:00 AM. The Senate Judiciary Committee will hold an executive business meeting. The agenda includes mark up of several technology, intellectual property and privacy related bills, including S 2031, the Intellectual Property Protection Restoration Act of 2002, S 848, the Social Security Number Misuse Prevention Act of 2001, and S 1742, the Restore Your Identity Act of 2001. However, this Committee frequently postpones consideration of items on its agenda. Location: Room 226, Dirksen Building.
10:00 - 11:00 AM. The High Tech Coalition on Trade Promotion Authority will hold a press conference to urge passage of TPA. Location: Room SC-4, Capitol Building.
12:00 NOON. The Internet Caucus Advisory Committee and the Congressional Internet Wireless Task Force will host a panel discussion titled The Wireless Internet: Is the U.S. Falling Behind? The speakers will be Gerry Waldron (Covington & Burling), Rudy Baca (Precursor Group), Chris Hare (DigitWireless), David Jeppsen (NTT DoCoMo), and Daniel Meredith (Vodafone). Lunch will be served. Location: Room HC-5, U.S. Capitol Building, Washington DC.
12:00 NOON. Sen. Russ Feingold (D-WI), Rep. Patsy Mink (D-HI), and members of the Free Expression Network will hold a press conference to mark the six month anniversary of the passage of the USA PATRIOT Act and to address threats to free expression that have arisen since the September 11 terrorist attacks. Location: Senate Swamp (across from the Senate steps on the East Front of the Capitol). In the event of rain, the location will be Room 216, Hart Building.
12:15 PM. The FCBA's Young Lawyers Committee will host a brown bag lunch. The topic will be "The Year of the 271". The speakers will be Dorothy Attwood (Chief of Wireline Competition Bureau), Michelle Carey, (Chief of the Competition Policy Division), Deena Shetler (Deputy Chief of the Pricing Policy Division), and Renee Crittendon (Senior Attorney Advisor in the Competition Policy Division). RSVP to Pam Slipakoff. Location: Room 8-C245, FCC, 445 12th Street, SW.
12:30 PM. The House Commerce Committee's Telecom and Internet Subcommittee will hold a hearing titled Ensuring Content Protection in the Digital Age. Location: Room 2123, Rayburn Building.
1:30 PM. FTC Commissioner Thomas Leary will participate in a panel discussion titled "Crises and Transitions: Is Competition Policy Responsive to Market Power Issues in Restructuring Energy Markets?" at the ABA 2002 Annual Antitrust Spring Meeting. Location: J.W. Marriott Hotel, 1331 Pennsylvania Ave., NW.
2:00 PM. The Senate Judiciary Committee will hold a hearing on several judicial nominees, including Julia Gibbons (to be a judge of the U.S. Court of Appeals for the Sixth Circuit), Leonard Davis (U.S.D.C., Eastern District of Texas), David Godbey (U.S.D.C., Northern District of Texas), Andrew Hanen (U.S.D.C., Southern District of Texas), Samuel Mays (U.S.D.C., Western District of Tennessee), and Thomas Rose (U.S.D.C., Southern District of Ohio). See, full agenda. Location: Room 226, Dirksen Building.
3:30 PM. Mark Lemley (Professor, Boalt Hall, UC Berkeley) will give a lecture titled "Antitrust, Intellectual Property, and Standard Setting Organizations". For more information, contact Prof. Julie Cohen at jec@law. georgetown.edu. Location: Georgetown University Law Center, Faculty Lounge, 5th Floor, McDonough Hall, 600 New Jersey Ave., NW.
Deadline to submit Notices of Intent to Participate to the Copyright Office in its negotiation of 17 U.S.C. § 118 noncommercial educational broadcasting compulsory license. See, notice in Federal Register.
Friday, April 26
The House will not be in session.
9:00 AM - 5:30 PM. Day two of a two day Copyright Conference hosted by the USPTO, the purpose of which is to "discuss current domestic and international issues vital to the development of e-commerce with members of the business and intellectual property communities." See, USPTO notice. Registration closes on April 19. Location: The Academy for Educational Development Conference Center, 1825 Connecticut Ave., NW, 8th Floor.
10:00 AM. The FCC's Technology Advisory Council will hold a meeting. See, FCC notice and notice in Federal Register. Location: Commission Meeting Room, FCC, 445 12th St., SW.
10:00 AM. FTC Chairman Timothy Muris will participate in a roundtable discussion at the ABA 2002 Annual Antitrust Spring Meeting. Location: J.W. Marriott Hotel, 1331 Pennsylvania Ave., NW.
12:00 NOON. The Cato Institute will host a briefing titled Financial Privacy and the War on Terrorism. The speakers will be David Burton (Prosperity Institute), Bradley Jansen (Free Congress Foundation), and Veronique de Rugy (Cato). Lunch will follow. See, agenda and online registration page. Location: Room B-369, Rayburn Building.
12:00 NOON - 2:00 PM. FCC Commissioner Kathleen Abernathy will address the American Woman in Radio & Television Awards Luncheon. For more information, contact Sallie Gitlitz at 202 337-4684. Location: Ballroom, National Press Club, 529 14th St. NW, 13th Floor.
3:00 - 5:00 PM. FCC Commissioner Kathleen Abernathy will address a Women's Bar Association Tea. Location: Mayflower Hotel.
Extended deadline to submit reply 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 29
The Supreme Court will go on recess until May 13.
10:00 - 11:30 AM. The FCC's Office of Engineering and Technology (OET) will hold a tutorial titled Security of Wireless Networks. David Wagner, Assistant Professor in the Computer Science Division at the University of California at Berkeley, will discuss security issues associated with 802.11 wireless networks. See, FCC release.
12:15 PM. The FCBA's Cable Practice Committee will host a luncheon. Rick Chessen, head of FCC's DTV Transition Task Force, will discuss Chairman Powell's proposal for accelerating the transition to digital television. The price to attend is $15. RSVP to wendy @fcba.org. Location: Mintz Levin, 9th Floor, 701 Pennsylvania Avenue, NW.
Tuesday, April 30
The U.S. Chamber of Commerce will host an event titled Beyond Broadband: Policy and Business Strategies for Next Generation Applications and Services. FCC Chairman Michael Powell will give the keynote luncheon address. The price to attend ranges from $275 to $500. For more information, contact Liza Ratana at 202 463-5500.
Deadline to submit reply comments to the FCC in response to its notice of proposed rulemaking regarding its unbundling analysis under § 251 of the Communications Act and the identification of specific unbundling requirements for incumbent local exchange carriers. See, notice in the Federal Register.
Deadline to submit requests to the USPTO's to speak at its May 16 public hearing on its proposed plan to eliminate the paper patent and trademark registration collections from its public search facilities, and to transition to electronic patent and trademark information collections. The USPTO is seeking public comment on issues related to this proposed plan. The USPTO is also seeking input on whether any governmental entity or non-profit organization is interested in acquiring the paper patent and trademark registration collections to be removed from the USPTO's public search facilities. See, notice in Federal Register.
Wednesday, May 1
10:00 AM. The House Commerce Committee's Subcommittee on Oversight and Investigations will hold a hearing on titled "Oversight and Management of the Government Purchase Card Program". Location: Room 2322, Rayburn Building.
11:00 AM. The Cato Institute will host a panel discussion titled A Progress Report on the HDTV Transition. The scheduled speakers are Mark Cuban (HDNet), Thomas Hazlett (Manhattan Institute), Rick Chessen (FCC), David Donovan (Association for Maximum Service Television), Michael Calabrese (New America Foundation), and Richard Wiley (Wiley Rein and Fielding). See, agenda and online registration page. Location: 1000 Massachusetts Avenue, NW.
12:00 PM. The FCBA will host a luncheon. The speaker will be Charlie Ergen, Ch/CEO of Echostar. The price is $45 for FCBA members, $35 for government and student members, and $55 for non-members. There will be a reception at 12:00 NOON. The luncheon will begin at 12:30 PM. RSVP to Wendy Parish at wendy @fcba.org by Friday, April 26. Location: Capital Hilton, 16th & K Streets.
Deadline to submit comments to the USTR regarding U.S. negotiating objectives and the work program launched at the Fourth Ministerial Conference of the WTO in November at Doha. See, USTR release and notice in the Federal Register.
Extended deadline for submitting comments to the Treasury Department regarding its study of information sharing practices among financial institutions and their affiliates. See, notice in Federal Register.