|Rep. Pickering Predicts No
Broadband Bill Will Pass This Year
|6/11. Rep. Chip
Pickering (R-MS) spoke at an American
Enterprise Institute (AEI) conference titled "The
Future of Telecom Regulation". He predicted that neither
the Tauzin Dingell bill, nor any competing legislation, will
pass the Congress this year.
Rep. Pickering is a member of the House Commerce Committee,
and its Telecom Subcommittee. Prior to his election in 1996 he
worked on the staff of then Senate Majority Leader Trent Lott (R-MS) on the
Telecommunications Act of 1996. He also addressed the status
271 applications, Third Generation (3G) wireless services
and spectrum management.
Pending Legislation. He stated that "I would like
to also talk about the state of legislation. As you all know,
we had broadband legislation, the Tauzin
Dingell bill, pass in the House. We now have most of the
action focused on the Senate. You have competing, conflicting,
contradictory efforts in the Senate. You have Senator Hollings who
would push for full compliance, full enforcement, of the '96
Act, focusing on the local market. You have incentives, from a
number of Senators, to build out, either in tax policy, or in
regulatory policy, for broadband deployment, stressing under
served and rural areas. You also have efforts to direct the
FCC and their regulatory proceedings by Senator Breaux and Nichols. You have Senator McCain, who has
taken a market by market approach."
Rep. Pickering continued, "What does all of that mean?
The House has taken action. The Senate has multiple
conflicting, competing -- in a political, a campaign year.
What is the likely outcome? The likely outcome is that nothing
happens. The prediction is that no legislation will pass or be
signed into law. And what does this all mean? Or, what is the
purpose or the focus of all of this debate, all of the
churning, all of this action in the House, and now in the
Senate? This is all, in my view, or almost all, geared towards
a message of communicating to the FCC what their next decision
should be as they have teed up, and have prepared, regulatory
procedures and processes and decisions that are coming on the
UNE platform, on broadband definition, and the triennial
Rep. Pickering was one of the leaders of the opposition to
passage of the Tauzin Dingell bill by the House Commerce
3G Wireless and Spectrum Management. Rep. Pickering
stated that "we are beginning a task force with Chairman
Tauzin, and the Subcommittee Chairman Upton, to begin looking at
spectrum reform, and any legislation that we might present,
but not this year, which would be difficult to do, but by the
first of the next Congress, because it is an issue that was
teed up, was prepared, pre September 11. With the events of
September 11, national security concerns, DOD
objections at that point, made moving forward in a positive
political way very difficult. But I do think that we have been
to have enough time to step back. NTIA
has come forward with some of its recommendations. The
industry has continued to make a good case among all of the
different policy makers, both on the Hill and in the
He added that "I do think that the environment will be
more favorable as we come back next year. And we need to be
able to strike very quickly, with a legislative proposal and
recommendations on how to achieve both the procedural changes
of how we make spectrum management decisions, but also what we
do in the very short term to get more spectrum available, how
we can move to 3G, what is the clear process, not only short
term, but long term."
Section 271. Rep. Pickering also talked about the
Section 271 applications by Regional Bell Operating Companies
(RBOCs) to provide in region interLATA (long distance)
services. He stated that "We have, over the last six
years, regulation, litigation, acquisition, concentration. We
are beginning to see emerging competition in multiple
platforms -- in cable, and wireless, and wireline on the
telephone, and telephony side, Internet telephony. As we look
at where we are from the regulatory process, 271s, the process
by which Bell companies are given permission and authority to
then enter into long distance, all distance, all services, we
have currently 13 approved."
He predicted that "By some time this year we expect to
have over half of the states granted -- or half of the
regional Bell operating companies in their states granted --
the authority and permission to enter into long distance. 65%
of all population in the country by the end of this year will
be under 271 and the full competition that we envisioned as we
enacted the Telecommunications Act of 1996."
"We hope that by the mid of next year, '03, that we will
see all states and all RBOCs, ILECs, have their 271s, the full
implementation of the competitive checklist, all of the market
opening requirements that they will be implemented completely.
And I think that is the appropriate time for us to begin
looking then at what type of regulatory modification,
modernization, that we should undertake at that point. We need
to make sure that the first step, the first objective, of
opening local markets, or having a competitive climate, and a
competitive checklist fully implemented, and full compliance,
to then see to where we need to go next," said Rep.
|FCC Inspector General
Reports on E-Rate Fraud
|6/11. The Federal
Communications Commission (FCC) released the most recent Semiannual
Report [32 pages in PDF] to Congress of its Inspector General, covering
the period October 1, 2001 through March 31, 2002. This report
focuses on fraud, waste and abuse in the FCC's Schools
and Libraries program, which is also known as the e-rate.
The e-rate provides subsidies to schools and libraries for
telecommunications services, Internet access, and internal
connections. The program is administered by the FCC's Universal Service
Administration Company (USAC).
The report states that "In calendar year 2000, USAC
contracted with a public accounting firm to conduct audits of
eighteen (18) beneficiaries of funding from the first year of
the Schools and Libraries program. Their audit resulted in a
major investigation by the Federal
Bureau of Investigation (FBI) and OIG representatives. The
matter has been referred as a civil false claims suit to the
Department of Justice, where it is under consideration.
Additionally, the audit report disclosed weaknesses (ranging
from regulatory non-compliances to computation errors) at 14
locations of the 17 beneficiaries reported on and $8 million
in inappropriate funding disbursements."
The report states that these matters remain under
consideration because, under the structure of the e-rate
program, it is not clear that "federal funds" are
The report also states that "Building on the work done
last year, USAC has contracted to conduct audits at twenty-two
(22) beneficiaries this calendar year. The results of this
audit are currently under review by USAC and the Wireline
Competition Bureau (WCB) of the FCC. The preliminary results
indicate there may be findings at nearly all locations
including several millions of dollars in inappropriate
disbursements and unsupported costs."
Finally, the report states that "we have been impeded by
difficulties in obtaining access to the resources necessary to
establish an effective oversight program."
|DC Circuit Denies Petition
for Review in Echostar v. FCC
|6/11. The U.S.
Court of Appeals (DCCir) issued its opinion
v. FCC. EchoStar
is a direct broadcast satellite (DBS) television service
provider. Comcast is
cable television service provider. Comcast refused to sell to
EchoStar the right to carry Comcast SportsNet, a variety of
sport programming, including games of several Philadelphia
sports teams. EchoStar filed a program access complaint with
the Federal Communications
Commission (FCC) under to 47 U.S.C.
§ 548. The FCC denied the complaint. EchoStar filed this
petition for review, which the Court of Appeals denied.
|9th Circuit Issues Order
Supplementing Opinion in Thornton v. McClatchy
|6/11. The U.S.
Court of Appeals (9thCir) issued its Order
Supplementing Opinion [PDF] in Thornton
v. McClatchy, affirming its original opinion
[PDF] that repetitive stress injuries that limit one's ability
to use a computer keyboard do not constitute a disability
within the meaning of the Americans with Disabilities Act
The Appeals Court had stayed the mandate of this case pending
resolution of the Supreme Court's decision in Toyota Motor
Mfg., Kentucky, Inc. v. Williams, 122 S. Ct. 681 (2002). The
Appeals Court affirmed, but clarified its original opinion,
issued on August 15, 2001. See also, 261 F.3d 789 (9th Cir.
Facts. Thornton worked for the Fresno Bee, a McClatchy
newspaper, as a writer. This required her to work with a
keyboard. She suffered from work related repetitive stress
disorder and could not operate a keyboard or write by hand for
more than brief periods. McClatchy concluded that she could
not perform her job, and terminated her employment.
District Court. Thornton filed a complaint in the U.S.
District Court (EDCal) against McClatchy alleging
violation of the ADA and the California Fair Employment and
Housing Act for terminating her on the basis of disability.
The District Court granted McClatchy summary judgment on the
grounds that she was not disabled.
Court of Appeals. The Appeals Court affirmed the
summary judgment on the ADA claim. It wrote in its original
opinion that "Thornton was able to perform a wide range
of manual tasks, including grocery shopping, driving, making
beds, doing laundry, and dressing herself. Her inability to
type and write for extended periods of time is not sufficient
to outweigh the large number of manual tasks that she can
perform. The ADA requires a "substantial limitation"
in performing manual tasks ..." However, it reversed on
the state law claim. Judge Hawkins wrote the opinion of the
Court, in which Judge Kozinski joined.
The June 11 order was written by Judge Kozinski. Judge Berzon
dissented from the original opinion, and the June 11 order.
|Supreme Court Denies
Certiorari in Trans Union v. FTC
|6/10. The Supreme
Court denied certiorari in Trans
Union v. FTC, a case regarding the sale of
consumer reports by credit reporting agencies for marketing
purposes, the Fair Credit Reporting Act
(FRCA), and the application of the First Amendment to
Trans Union (TU) is one of
the three large credit reporting agencies. It compiles credit
reports about individuals from credit information that it
collects from banks, credit card companies, and other lenders.
Its databases contain information on 190 Million people. It
then sells these credit reports to lenders, employers, and
insurance companies. This practice was not at issue. However,
TU also sells target marketing products to direct marketers.
These consist of lists of names and addresses of individuals
who meet specific criteria, such as possession of an auto
loan, a department store credit card, or two or more
mortgages. This practice was at issue.
The Federal Trade Commission
(FTC) has responsibility for enforcing the FCRA. This statute
protects the privacy of credit information by prohibiting
credit reporting agencies from selling "consumer
reports", except under the circumstances enumerated in
the Act. The FRCA lists whether to approve an application for
credit, employment, or insurance -- but not direct marketing.
The FRCA defines a "consumer report" as any
information provided "by a consumer reporting agency
bearing on a consumer's credit worthiness, credit standing,
credit capacity, character, general reputation, personal
characteristics, or mode of living which is used or expected
to be used or collected in whole or in part for the purpose of
serving as a factor in establishing the consumer's eligibility
for (A) credit ..."
The FTC instituted a proceeding against TU in 1992. The FTC
first issued a cease and desist order
in 1994. However, the Court of Appeals granted TU's petition
for review, on the grounds that the FTC had failed to provide
evidence that TU's target marketing products were used by
marketers in the issuance of credit. See, Trans Union Corp. v.
FTC, 81 F.3d 228 (DCCir 1996). So, the FTC conducted extensive
discovery, held a month long administrative trial, and
documented this contention. It again ordered TU to stop.
TU again filed a petition for review with the U.S.
Court of Appeals (DCCir). On April 13, 2001, the Appeals
Court issued its opinion
upholding the FTC's order that TU must stop selling target
marketing lists for purposes not listed in the Fair Credit Reporting Act
(FRCA). The Appeals Court also upheld the constitutionality of
First, TU argued, among other things, that the FRCA is
unconstitutionally vague under the due process clause of the
Fifth Amendment, and that it is an unconstitutional restraint
on free speech. TU sought application of the strict scrutiny
standard. The Appeals Court upheld the FRCA's
constitutionality, applying the reduced constitutional
protection standard for commercial speech articulated by the
Supreme Court in Dun & Bradstreet v. Greenmoss,
472 U.S. 749 (1985).
TU filed a petition for writ of certiorari with the Supreme
Court. The Court denied certiorari. However, two justices,
Kennedy and O'Connor, wrote an opinion
[PDF] dissenting from the denial of certiorari. They wrote
that "this case meets the standards for review by this
Court. The plurality opinion in Dun & Bradstreet
concluded that a false statement in a credit report was not
speech on a matter of public concern, as that term is used in
the context of defamation law. It is questionable, however,
whether this precedent has any place in the context of
truthful, nondefamatory speech. Indeed, Dun &
Bradstreet rejected in specific terms the view that its
holding ``eaves all credit reporting subject to reduced First
Amendment protection.´´ ... The Court of Appeals,
nonetheless, relied on Dun & Bradstreet to
denigrate the importance of this speech. A grant of certiorari
is warranted to weigh the validity of this new
|FTC Chairman Muris
|6/11. Federal Trade Commission
(FTC) Chairman Timothy Muris gave a speech
titled "Protecting Consumers' Privacy: Goals and
Accomplishments" in Reston, Virginia. He reviewed efforts
by the FTC to protect consumer privacy. He also discussed
He stated that "The question is: do we know enough now to
fashion workable general privacy legislation that will provide
cost efficient protection for consumer privacy? Our experience
shows we do not."
He continued that "I am also troubled that many current
legislative proposals would apply only to online information
collection. Legislation subjecting one set of competitors to
different rules, simply based on the medium used to collect
the information, is likely to distort the market. Indeed the
sources of information that lead to our number one privacy
complaint -- ID Theft -- are frequently offline."
|North Dakota Voters Approve
Financial Privacy Ballot Measure
|6/11. The state of North
Dakota held a primary election on June 11. The voters
Item No. 2 [PDF], which pertains to the disclosure of
customer information by financial institutions, by a vote of
69,802 to 25,737. See, elections
The ballot measure reads, in part, as follows: "Senate
Bill No. 2191, approved by the 2001 Legislative Assembly,
became law on July 1, 2001. The law pertains to the disclosure
of customer information by financial institutions, including
banks and credit unions, and notification of privacy policies
by financial institutions. The law changes the definitions of
a ``customer´´ of a financial institution and ``customer
information´´ to be similar to that provided in federal law.
It permits financial institutions to disclose nonpublic
personal information to third parties unless the customer does
not agree to the disclosure and so notifies the financial
institution, a process described as ``opting out.´´ The law
also requires financial institutions to notify their
agricultural and commercial customers about the financial
institution's privacy policies and to notify those customers
annually of their right to ``opt out´´ of having their
nonpublic information disclosed."
See also, N.D.
Senate Bill 2191 [PDF], providing for this ballot measure.
|Magistrate Judge Issues
Recommendations Re Personal Jurisdiction in Baan Case
|6/11. A Magistrate Judge of the U.S.
District Court (DC) issued his Report and
Recommendation [PDF] in In Re Baan Company Securities
Litigation on the FRCP 12(b)(2) motions to dismiss for lack of
personal jurisdiction over defendants Paul Baan and Vanenberg
This is a class action against the Baan Company and certain of
its officers and directors alleging securities fraud. This
recommendation is a rather standard 12(b)(2) determination,
except for the Court's characterization of the arguments made
by plaintiffs' counsel regarding Baan's deposition. The Court
wrote: "I have never seen and I hope that I will never
see again such utter mischaracterizations of what a witness
actually said or such bold assertions based on absolutely
nothing the witness said." The Magistrate Judge
recommended granting the motions to dismiss.
|6/11. The New
Hampshire Public Utilities Commission voted to support Verizon's Section
271 application to the Federal
Communications Commission (FCC) to provide in region
interLATA services. Verizon stated in a release that it
"expects to file its application with the Federal
Communications Commission later this month".
6/11. BellSouth Ch/CEO
Duane Ackerman gave a speech
in Hilton Head Island, South Carolina. He stated that
"While technology is getting smaller and faster, the gulf
between technology and the Southern workforce is threatening
to get bigger. We have come far in developing the microchip,
but somehow we have left too many Mables and Mikes behind,
stranded with neither the skills to compete nor the tools to
learn. We've moved on to the digital age of networks and
connectivity, but our workforce system is stuck in the old
machine age of smokestacks and assembly lines." He
concluded that "we must invest in a Southern workforce
for the digital age".
6/10. Federal Trade Commission
(FTC) Chairman Timothy Muris gave a speech
titled "On the Occasion of the Celebration of the
Twentieth Anniversary of the 1982 Merger Guidelines" at
the Department of Justice in Washington DC.
|Wednesday, June 12
|The House will likely consider a motion to go to conference
on HR 3005,
the Bipartisan Trade Promotion Authority Act of 2002.
The Supreme Court is on recess until Monday, June 17.
7:00 AM - 3:30 PM. Day two of a two day conference titled Current
and Emerging Solutions to Public Safety Communications
Interoperability hosted by the NTIA
and the Public Safety Wireless Network Program. Audio webcast.
See also, notice
in the Federal Register. Location: Ronald Reagan International
Trade Center, 1300 Pennsylvania Avenue, NW.
8:30 AM - 4:00 PM. Day two of a three day meeting of the NIST's
Computer System Security and Privacy Advisory Board. See, notice
in Federal Register. Location: National Security Agency's
National Cryptologic Museum, Colony 7 Road, Annapolis
9:00 AM - 1:00 PM. The President's Council of Advisors on
Science and Technology will hold a public meeting. The agenda
includes four items: (1) the science and technology of
combating terrorism, (2) policies and technologies to improve
energy efficiency, (3) the federal investment in science and
technology research and development, and (4) demand issues
that can speed the deployment of a 21st Century broadband
infrastructure. See, notice
in Federal Register. Location: Colonial Room, Renaissance
Mayflower Hotel, 1127 Connecticut Ave., NW.
10:00 AM. The FCC's Technological Advisory
Council will hold a meeting. See, FCC
notice [PDF]. Location: FCC, Commission Meeting Room, 445
12th St., SW.
11:00 AM. The Cato Institute
will host a panel discussion titled Digital Copy
Protection: Mandate It? Ban It? Or Let the Market Decide?.
The speakers will be Rick Lane (News Corporation), Jonathan
Potter (DiMA), Sarah Deutsch (Verizon), Stewart Verdery (Vivendi
Universal), and Jonathan Zuck (ACT).
Lunch will follow. Webcast. See, online
registration page. Location: Cato, 1000 Massachusetts
12:30 PM. The FCBA's
Global Telecommunications Development Committee and the
International Practice Committee will host a luncheon seminar
titled Three Principles for the Liberalization of
Telecommunications in Latin America: Competition, Competition
and Competition. The speakers will be Henoch Aguiar, a
former Secretary of Telecommunications of Argentina. This
program is free and lunch will be provided. RSVP by faxing or
e-mailing your name, affiliation, and contact information to
Javier Miguel Tizado at 202 639-9355 or jtizado @whitecase.com
by Monday, June 10th. Location: White & Case, 601 13th
St., NW, Suite 600.
1:00 PM. USPTO Director James Rogan
will deliver the keynote address at the 8th USPTO University
Awards Ceremony. See, notice.
Location: Marriott Crystal Forum, 1999 Jefferson Davis
Highway, Arlington, VA.
PM. The Senate
Judiciary Committee's Subcommittee on Technology,
Terrorism, and Government Information Subcommittee will hold a
hearing on S 2541,
the Identity Theft Penalty Enhancement Act.
2:30 PM. The Senate
Commerce Committee's Subcommittee on Science, Technology,
and Space Subcommittee will hold a hearings to examine the ICANN.
The scheduled witnesses are Nancy
Victory (Director of the NTIA),
Peter Guerrero (GAO), Stuart Lynn
(President of the ICANN), Karl Auerbach (Member of the ICANN
Board of Directors), Roger Cochetti (VeriSign), Alan Davidson (CDT), and
Cameron Powell (SnapNames).
Press contact: Andy Davis at 202 224-6654. Location: Room 253,
7:00 PM. Commerce Secretary Don
Evans will give the keynote address at the10th annual U.S.
ASEAN Business Council Ambassadors Tour Dinner. Location: Four
Seasons Hotel, 2800 Pennsylvania Ave., NW.
|Thursday, June 13
|The House will meet at 10:00 AM for legislative business. No
votes are expected after 6:00 PM. The House will likely
consider HR 4019,
the Permanent Marriage Penalty Relief Act of 2002.
8:30 AM - 3:00 PM. Day three of a three day meeting of the NIST's
Computer System Security and Privacy Advisory Board. See, notice
in Federal Register.
9:30 AM. The FCC will hold a
meeting. See, agenda.
Location: FCC, 445 12th Street, SW, Room TW-C05 (Commission
10:00 AM. The House
Ways and Means Committee will hold a hearing on the extraterritorial
income regime. Location: Room 1100, Longworth Building.
10:00 AM. The House
Judiciary Committee has scheduled a meeting to mark up
several bills, including HR 4598,
the Homeland Security Information Sharing Act, HR 3215,
the Combatting Illegal Gambling Reform and Modernization Act (Goodlatte
Internet gambling bill), and HR 4623,
the Child Obscenity and Pormography Prevention Act of 2002.
Audio webcast. Location: Room 2141, Rayburn Building.
10:00 AM. The Senate
Judiciary Committee will hold a business meeting. See, notice.
Press contact: Mimi Devlin at 202 224-9437. Location: Room
226, Dirksen Building.
2:00 - 4:00 PM. The American
Enterprise Institute (AEI) will host a panel discussion
titled The Future of the Distribution of Video Programming.
The speakers will be Harold Furchtgott Roth (AEI), James Ramo
Fritz (Albritton Communications), Michael Kupinski (A.G. Edwards), Jonathan
Potter (DiMA), and Donald
Whiteside (Intel). See, agenda and
registration page. Location: AEI, 12th floor, 1150 17th
2:00 PM. The Senate
Judiciary Committee will hold a hearing on pending judicial
nominations. See, notice.
Press contact: Mimi Devlin at 202 224-9437. Location: Room
226, Dirksen Building.
2:30 PM. The House
Judiciary Committee's Subcommittee on Courts, the
Internet, and Intellectual Property will hold an oversight
hearing on titled Copyright Arbitration Royalty Panel
Structure and Process. Location: Room 2141, Rayburn
|Saturday, June 15
|Deadline for the FCC to submit
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. See, FCC
|Monday, June 17
|The Supreme Court will return from recess.
2:00 - 3:30 PM. The FCC's International Bureau will
hold a public forum to discuss issues and policies pertaining
to the international satellite network coordination process
and the domestic regulatory aspects of the International
Telecommunication Union's satellite network filing
process. Location: FCC, 445 12th Street, SW, Room TW-C305.
Deadline to submit comments to the FCC regarding
its Notice of Proposed Rulemaking regarding the consequences
of the FCC's classification of cable modem service as an
information service. This is CS Docket No. 02-52. See, FCC
release [PDF] and notice
in Federal Register.
|Tuesday, June 18
|8:30 - 10:00 AM. The American
Enterprise Institute (AEI) will host a press breakfast
titled "Telecommunications and Media Issues" with
former FCC Commissioner Harold Furchtgott Roth and other AEI
scholars. RSVP to Veronique Rodman at telephone 202 862-4871
or vrodman @aei.org.
Location: AEI, 1150 17th Street, NW, 11th Floor Conference
12:00 NOON. The FTC will host an event
titled Workshop on Merger Remedies. See, FTC release.
Location: Room 332, FTC, 600 Pennsylvania Ave., NW.
9:00 AM - 4:00 PM. The Global
Internet Project will host a conference titled Spam:
Can It Be Stopped? FTC Commissioner Orson
Swindle will give the opening keynote address at 9:20 AM. See,
Location: Crystal Gateway Marriott, Arlington, VA.
Day one of a four day conference titled "INET 2002:
Internet Crossroads: Where Technology and Policy
Intersect". See, conference
information page. Location: Crystal Gateway Marriott,
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