Tech Law Journal Daily E-Mail Alert
August 12, 2002, 9:00 AM ET, Alert No. 489.
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FCC to Sunset Cellular Analog Requirements
8/8. The Federal Communications Commission (FCC) announced, but did not release, a Report and Order modifying Part 22 of its rules that cover cellular phone service. It did, however, issue a press release [3 pages in PDF]. This Report and Order eliminates certain outdated rules that were more applicable when all cellular service was analog. For example, it eliminates, after fives years, the requirement that service providers that have converted to digital service must also continue to provide analog service.
The Report and Order is FCC 02-229. This proceeding is titled "Year 2000 Biennial Review -- Amendment of Part 22 of the Commission’s Rules to Modify or Eliminate Outdated Rules Affecting the Cellular Radiotelephone Service and Other Commercial Mobile Radio Services". It is numbered WT Docket No. 01-108.
While the Report and Order makes numerous rule changes, most of the discussion and debate at the FCC meeting of August 8 on this item was devoted to the elimination of the cellular analog requirement.
Roger Noel, Deputy Chief of the Commercial Wireless Division, stated at the FCC meeting that the Report and Order provides that the cellular analog requirement will sunset after five years. However, he further stated the caveat that the Report and Order also requires CMRS carriers to file reports after three and four years, and that the FCC will then determine whether to extend the sunset.
FCC Commissioner Michael Copps approved in part, and dissented in part. He objected to changing the cellular analog rule. He also dissented from the elimination of cellular anti trafficking rules. He also stated that he objects to "the elimination of the requirement that cellular applicants demonstrate their financial ability to operate their system at a time when bankruptcies are threatening consumers". See, statement [PDF].
Commissioner Kevin Martin said in his statement [PDF] that ultimately, the FCC "must ensure the availability of digital phones that are compatible with hearing aids and cochlear implants. Fixing the digital compatibility problem, rather than relegating the hearing disabled community to analog phones, is the real solution."
While FCC staff and the other Commissioners focused on the impact of eliminating the cellular analog rules for persons using analog hearing aids, it was left to FCC Chairman Michael Powell to explain the underlying purpose. There is a shortage of spectrum for current cellular services, not to mention future Third Generation wireless services. Spectrum that is still allocated for analog cellular service is underused, inefficiently used, and preventing its use for digital cellular services, as well as future services.
This is what Powell had to say at the meeting: "I would just like to make one point of interest. One might listen to the overview of this item, and fail to see the concomitant public interest benefit, like the very real and important returns associated with hearing aid compatibility. But, the overwhelming number of Americans in country who subscribe to digital services increasingly have service and quality disruption problems as a consequence of spectrum shortages. One of the huge consumers of spectrum is the continued requirement for the provision of analog services, much of which goes underutilized."
Powell continued that "A logical transition path, a pretty significant period of time, is a way of demonstrating a course toward a world in which spectrum can be moved efficiently to higher and better uses that are concomitant with the public's interest, and what they continue to demand in terms of new and wireless services. I don't think that the Commission has trivialized the importance of an important segment of the hearing disabled community, and it has made adequate precautions to ensure that should those requirements not be complied with, in the context of that order, one has to trust a Commission committed to the public interest will act in response to impending sunset. I certainly believe that I, and any successors of interest of ours will do that. But, I do think that it is important for the market, for consumers, to keep trying to push spectrum in ways that are a higher and better use, to improve service quality, to improve the viability of service that everyone understands is continuing to strain under a spectrum shortage."
Nancy Victory, Director of the National Telecommunications and Information Administration (NTIA), stated in a release that "The Administration supports the Commission's decision to eliminate the outdated analog cellular requirement over five years ... As a result of this action, spectrum will be managed more efficiently and carriers will have more flexibility to create innovative new services for consumers. I also commend the Commission for helping to meet the needs of the hearing assisted community and the telematics industry by establishing a reasonable transition period and committing to monitor the success of that transition."
Tom Wheeler, P/CEO of the Cellular Telecommunications & Internet Association (CTIA), stated in a release that "This is a matter of good spectrum management ... We are in a serious spectrum crunch and analog is an outdated technology that makes poor use of scarce spectrum. Digital technology increases cell site capacity and it allows better security, quality and new services for customers. Wireless users generally replace their phones every 18 months, so the five year transition period allows analog subscribers and their service providers more than three product cycles to upgrade to digital technology."
FCC to Eliminate Anti Trafficking and Other Cellular Rules
8/8. The Federal Communications Commission (FCC)'s Report and Order modifying Part 22 of its rules that cover the cellular phone service addresses other topics, in addition to analog cellular requirements. For example, it also eliminates the cellular anti trafficking rule.
FCC Commissioner Michael CoppsAnti Trafficking. The Report and Order also provides for the elimination of the cellular anti trafficking rule. Commissioner Michael Copps (at right) said in his prepared statement [PDF] that "Our rules also currently protect consumers against the dangers of speculation and the trafficking of cellular licenses. There is a danger to American consumers when speculators obtain licenses with the intention of ``flipping their license´´ for a quick profit rather than providing service. The spectrum is a public resource. Congress entrusted the Commission with the duty to manage the spectrum intending that we work to assign it to people who will promote the public interest. Our anti trafficking rules require cellular licensees to provide service for one year before selling their license. This furthers Congress's goal, and does not seem too much to ask of those privileged to hold a cellular license. Nonetheless, the Commission eliminates this rule today."
Fox v. FCC and the Meaning of Necessary. Commissioner Kevin Martin also addressed the legal controversy regarding the meaning of the word "necessary". He wrote in his prepared statement [PDF] that under the biennial review process, the FCC must "review its regulations for providers of telecommunications service every two years and to ``determine whether any such regulation is no longer necessary in the public interest as the result of meaningful economic competition between providers of such service.´´" Then, it "shall repeal or modify any regulation it determines to be no longer necessary in the public interest." See, 47 U.S.C. § 161.
Martin wrote in his prepared statement that "I am concerned by the Order’s failure to discuss the meaning of the term ``necessary´´". This is also at issue in Fox v. FCC, in which the FCC seeks review of the February 19, 2002, opinion of the U.S. Court of Appeals (DCCir). The FCC argued in its Petition for Rehearing En Banc [40 pages in PDF] that the term "necessary" should not necessarily be construed to mean "necessary"; and, if it is, this "threatens to impose a continuing and unworkable burden on the agency in carrying out its biennial review responsibilities."
See, story titled "FCC Files Petition for Review of Appeals Court Opinion in Fox v. FCC" in TLJ Daily E-Mail Alert No. 415, April 22, 2002, and story titled "DC Circuit Vacates Cable Broadcast Cross Ownership Rule" in TLJ Daily E-Mail Alert No. 372, February 20, 2002.
Martin argued that the term should be "read in accordance with its plain meaning", and that the FCC should have tackled this issue in this Report and Order. However, he did not raise this in his oral remarks at the FCC meeting on August 8.
FCC Releases Order Setting DTV Mandates and Deadlines
8/9. The Federal Communications Commission (FCC) released its Second Report and Order and Second Memorandum Opinion and Order [48 pages in PDF] in the proceeding titled "In the Matter of Review of the Commission's Rules and Policies Affecting the Conversion To Digital Television". This Report and Order requires that most TV sets be built with digital TV tuners by 2007.
This is MM Docket No. 00-39. The FCC announced, but did not release, this Report and Order at its August 8, 2002, meeting. See also, stories in TLJ Daily E-Mail Alert No. 488, August 9, 2002.
More News
8/9. The Office of the U.S. Trade Representative (USTR) proposed opening World Trade Organization (WTO) dispute settlement proceedings to the public. The USTR proposes that the WTO hold open hearings, make briefs available to the public (except in confidential proceedings), provide early public release of panel reports, and adopt rules governing the consideration of amicus curiae submissions. See, USTR release
FCC Issues NPRM on Broadcast Flag
8/8. The Federal Communications Commission (FCC) adopted a Notice of Proposed Rulemaking (NPRM) [15 pages in PDF] in its proceeding titled "In the Matter of Digital Broadcast Copy Protection". This NPRM proposes that the FCC promulgate a broadcast flag rule, and seeks comment on this, and related questions.
This is MB Docket No. 02-230. Public comments are due by October 30, 2002. Reply comments are due by December 13, 2002. See also, FCC release [PDF].
Ken Ferree, Chief of the FCC's Media Bureau, stated that the NPRM "addresses another key hurdle to the DTV transition, the absence of a digital broadcast copy protection mechanism. In the absence of adequate protection, an unlimited number of near perfect copies of digital content can be made in violation of copyright."
The NPRM states that "Without adequate protection, digital media, unlike its analog counterpart, is susceptible to piracy because an unlimited number of high quality copies can be made and distributed in violation of copyright laws. In the absence of a copy protection scheme for digital broadcast television, content providers have asserted that they will not permit high quality programming to be broadcast digitally. 1 Without such programming, consumers may be reluctant to invest in DTV receivers and equipment, thereby delaying the DTV transition."
The NPRM recites the history of negotiations conducted by representatives of the consumer electronics, information technology, motion picture, cable and broadcast industries on copy protection issues. It states that the Copy Protection Technical Working Group's (CPTWG) Broadcast Protection Discussion Subgroup (BPDG) "recently announced a consensus on the use of a ``broadcast flag´´ standard for digital broadcast copy protection. This consensus would require use of the Redistribution Control Descriptor, as set forth in ATSC Standard A/65A (the ``ATSC flag´´), to mark digital broadcast programming so as to limit its improper use."
However, the NPRM continues, "Despite the consensus reached on the technical standard to be implemented, final agreement was not reached on a set of compliance and robustness requirements to be associated with use of the ATSC flag, enforcement mechanisms, or criteria for approving the use of specific protection technologies in consumer electronics devices."
The NPRM seeks comment on whether the FCC should promulgate broadcast flag regulations. It also seeks comment on "whether quality digital programming is now being withheld because of concerns over the lack of digital broadcast copy protection" and "To what extent would the absence of a digital broadcast copy protection scheme and the lack of high quality digital programming delay or prevent the DTV transition?"
The NPRM also seeks comment on "whether broadcasters and content providers should be required to embed the ATSC flag or another type of content control mark within digital broadcast programming, or whether they have sufficient incentive to protect such programming such that a government mandate is unnecessary." It also seeks comment on whether the FCC "should mandate that consumer electronics devices recognize and give effect to the ATSC flag or another type of content control mark", and if so, "whether this mandate should include devices other than DTV broadcast receivers".
The NPRM also seeks comments "on the extent to which broadcast copy protection technologies raise privacy concerns and whether rules are needed to ensure that consumers' privacy interests are protected", and "whether there are First Amendment or any other constitutional issues".
The NPRM finally asks whether the FCC even has authority to conduct this rule making proceeding. See, following story.
FCC Debates Its Authority to Promulgate Broadcast Flag Rule
8/8. The Federal Communications Commission's (FCC) Notice of Proposed Rulemaking (NPRM) in its proceeding titled "In the Matter of Digital Broadcast Copy Protection" also asks for comments on the statutory authority of the FCC to conduct this NPRM.
Simply put, Title 17 of the U.S. Code, which codifies the Copyright Act, gives rule making authority for implementing the Copyright Act to the Library of Congress, not the FCC. Moreover, there is no specific grant of authority to the FCC in Title 47 of the U.S. Code, the Communications Act, to promulgate copyright protection regulations.
Commissioner Michael Copps said in his prepared statement [PDF] at the FCC's August 8 meeting that "there is not a majority here to resolve the issue of the Commission's authority".
If the FCC were to assert authority, it might be based upon Title I of the Communications Act, which contains a general statement regarding protecting against public interest harms. It was, for example, the authority relied upon by the FCC in promulgating Computer I, Computer II and, Computer III.
However, Title I has served as the basis for not subjecting "information services" to regulation under other Titles of the Communications Act (such as those pertaining to cable and common carrier), rather than as the basis for subjecting to FCC rulemaking a subject committed to another federal agency, and historically addressed by the Congress or the Copyright Office.
The NPRM also seeks comment on "the jurisdictional basis for Commission rules dealing with digital broadcast television copy protection. Is this an area in which the Commission could exercise its ancillary jurisdiction under Title I of the Act? We ask commenters to identify provisions of the Act that provide the Commission with authority to implement its ancillary jurisdiction. If the Commission has ancillary jurisdiction over digital broadcast copy protection, are there any limits upon its scope? For example, does the Commission have authority to mandate the recognition of the ATSC flag in consumer electronics devices? We also ask commenters to identify any statutory provisions that might provide the Commission with more explicit authority to adopt digital broadcast copy protection rules. For example, do Sections 336(b)(4) and (b)(5) impact upon the Commission’s ability to adopt digital broadcast copy protection regulations?"
Commissioner Kathleen Abernathy stated at the August 8 meeting that "I also want to emphasize that there are some very real jurisdictional questions that need to be addressed in the first instance".
Commission Kevin Martin stated that there are two issues, "whether the Commission has jurisdiction over this copy protection issue" and "whether we should exercise that authority".
Commissioner Copps, in contrast, stated that "I believe a strong case can be made that the statute provides us with such authority." However, he did not set out the case.
Ken Ferree, Chief of the FCC's Media Bureau, spoke to reporters after the FCC's August 8 meeting. He insisted that there is not a turf fight between the FCC and Library of Congress.
AG Ashcroft Addresses Liberty, Order, and Electronic Surveillance
8/7. Attorney General John Ashcroft gave a speech to the Eighth Circuit Judges Conference in Duluth, Minnesota. He spoke philosophically about the nature of liberty and order. He also addressed Internet and communications surveillance.
Ashcroft stated that "Our post September 11 policies have been carefully crafted to prevent terrorist attacks while protecting the privacy and civil liberties of Americans. We have, for example, sought to close the technology gap between terrorists and law enforcement by updating the law. Congress passed the USA Patriot Act which allows us to monitor communications in the digital, as well as the analog world."
He continued that "I have also revised guidelines for FBI agents to allow them to conduct online searches on the same terms and conditions as the rest of the public. But with every reform, we have been careful not to alter the important, substantive legal predicates that exist to preserve the privacy of law abiding citizens. We have also enhanced the capacity of law enforcement to gather and analyze intelligence on terrorist activity. The Patriot Act broadened our ability to share intelligence between and among government agencies."
He compared the work of the Department of Justice in fighting terrorism to the Nuremberg tribunal. He stated that "It is now as it was then. A calculated, malignant and devastating evil has arisen in our world. Civilization cannot ignore the wrongs that have been done. America will not tolerate their being repeated."
He quoted former Justice Robert Jackson twice. He also cited Benjamin Franklin, George Washington, Learned Hand, George Orwell, and Randy Barnett.
People and Appointments
8/9. William LaFuze and Albert Jacobs were appointed to the U.S. Patent and Trademark Office's (USPTO) Patent Public Advisory Committee. LaFuze is a partner in the law firm of Vinson & Elkins, and co-chair of the firm's Intellectual Property / Technical Litigation Practice; he is also a past president of the American Intellectual Property Law Association. Jacobs is a shareholder in the New York City office of the law firm of Greenberg Traurig, and Chair of its National Intellectual Property Practice.
8/9. President Bush announced his intent to designate Vance Coffman to be Chairman of the President's National Security Telecommunications Advisory Committee (NSTAC). He also announced his intent to designate Duane Ackerman to be Vice Chairman of the NSTAC. Coffman is Ch/CEO of Lockheed Martin. Ackerman is Ch/CEO of BellSouth. The NSTAC, created by Executive Order 12382 in September 1982, provides industry based advice and expertise to the President regarding national security and emergency preparedness communications policy. See, White House release.
DHHS Revises HIPAA Health Privacy Rules
8/9. The Department of Health and Human Services (DHHS) released changes to the regulations setting standards for privacy of individually identifiable health information, promulgated pursuant to the Health Insurance Portability and Accountability Act of 1996 (HIPAA).
See, DHHS release, DHHS summary of changes, and DHHS prepublication of changes to the privacy regulations [MS Word], all released on August 9. See also, DHHS's medical privacy web site.
Congress passed the HIPAA in 1996. It provided that the Congress would enact national patient privacy standards within three years, and that if it did not, then the DHHS would promulgate regulations. The Congress did not enact a health privacy bill. Hence, the DHHS acted. It issued its proposed rule in 1999, and then, on December 28, 2000, in the closing days of the Clinton administration, released its final rule. See, 2000 Rule: Part 1 | Part 2 | Part 3 | Part 4 | Regulation Text Only.
The current release contains changes to the 2000 rule. On August 9, the DHHS released a prepublication of changes to the rule. On August 14 the DHHS will publish the entire rule, as amended, in the Federal Register. The rule will take effect for most covered entities on April 14, 2003.
Secretary of HHS Tommy Thompson stated in a release that "The rule protects the confidentiality of Americans' medical records without creating new barriers to receiving quality health care. It strikes a common sense balance by providing consumers with personal privacy protections and access to high quality care."
Georgetown University's Health Privacy Project issued a release in which it stated that "With these changes, HHS eliminates the patient consent requirement and opens the door for the use of people's medical records for marketing purposes without notice or consent."
Monday, August 12
Day five of six of the American Bar Association's annual meeting. See, TLJ's complete listing of technology law related events. Location: various hotels across Washington DC. Highlights include the following:
 • 8:45 AM. Program titled "Is Washington Still the Center of the Antitrust Universe? Do the Supreme Court, the Congress and the Federal Enforcement Agencies Control the Agenda?" Location: Ritz-Carlton, The Plaza Ballroom, Lobby Level.
 • 9:00 AM. Program titled "Securities Enforcement Then and Now: The SEC Under a New Administration". Location: Mayflower, Grand Ballroom, Promenade Level.
 • 9:30 AM. Program titled "Privacy of Healthcare Information: What Every Attorney Should Know about HIPAA". Location: Marriott Wardman Park, Maryland Suite C, Lobby Level.
 • 10:00 AM. Program titled "Patriot Games No Longer: Business Community’s Role in Cybersecurity -- New Requirements and Evolving Practical Concerns for Business Lawyers". Location: Hyatt Regency, Ticonderoga, Ballroom Level.
 • 10:30 AM. Program titled "Stolen Identities: Government and Industry Responses to Consumer Identity Fraud". Location: Hyatt Regency, Yorktown, Ballroom Level.
 • 11:00 AM. Program titled "Foreign Trade Antitrust Improvements Act: How Does It Affect Washington’s Dominance in the Antitrust Universe?" Location: Ritz-Carlton, The Plaza Ballroom, Lobby Level.
 • 1:30 PM. Program titled "Global Harmonization: Has There Been Any Progress in Relocating the Center of the Antitrust Universe?" Location: Ritz-Carlton, The Plaza Ballroom, Lobby Level.
 • 2:00 PM. Program titled "Internet and Other Electronic Information Access for Persons with Disabilities". Location: Marriott Wardman Park, Virginia Suite A, Lobby Level.
 • 2:30 PM. Program titled "Reality Bytes? eContracting in Today’s Environment". Location: Hyatt Regency, Congressional A, Lobby Level.
 • 2:30 PM. Program titled "Recent Developments in Antitrust: A Global Review". Location: Hyatt Regency, Congressional B, Lobby Level.
 • 3:45 PM. Program titled "Are States Invited to the Party? Federal Preemption of State Antitrust Law: Why Not?" Location: Ritz-Carlton, The Plaza Ballroom, Lobby Level.
Deadline to submit reply comments to the Federal Communications Commission (FCC) in response to its Notice of Proposed Rule Making (NPRM) "regarding the sunset of the statutory requirements under section 272 imposed on Bell Operating Companies (BOCs) when they provide in-region, interLATA services and seeks comment on whether, and if so, under what conditions, the structural and nondiscrimination safeguards established in section 272 should be extended by the Commission either generally or with respect to specific states." See, notice in the Federal Register, June 21, 2002, Vol. 67, No. 120, at Pages 42211 - 42215.
Tuesday, August 13
Day six of six of the American Bar Association's annual meeting. See, TLJ's complete listing of technology law related events. Location: various hotels across Washington DC. Highlights include the following:
 • 8:30 AM. Program titled "The Antitrust Year in Review". Location: Ritz-Carlton, The Plaza Ballroom, Lobby Level.
 • 9:00 AM. Program titled "Cyber-Sleuthing: A Guide to Level Computer Assisted Discovery and Collection of Electronic Data". Location: Hilton Washington, Jefferson Ballroom East, Concourse Level.
 • 12:00 PM. Event titled "Antitrust Luncheon: Developments in Federal Antitrust Enforcement 2002". Location: Ritz-Carlton, The Ritz-Carlton Ballroom, Salon III, Lobby Level.
 • 2:00 PM. Program titled "Developments in Merger Law and Policy 2002". Location: Ritz-Carlton, The Plaza Ballroom, Lobby Level.
10:00 AM. The U.S. District Court (DC) will hold a status hearing in USTA v. FBI, D.C. No. 1:1998cv2010. Judge Hogan will preside. Location: Courtroom 8, 333 Constitution Ave., NW.
10:00 AM - 12:00 NOON. The State Department's International Telecommunication Advisory Committee (ITAC) will meet. See, notice in Federal Register. Location: Room 1105, State Department.
Wednesday, August 14
1:00 - 5:00 PM. The Department of Commerce's (DOC) National Telecommunications and Information Administration (NTIA) will host a roundtable meeting regarding the convergence of communications technologies, including the Telephone Number Mapping (ENUM) Protocol that facilitates convergence between the Internet and the public switched telephone network. See, NTIA release, agenda, and notice in the Federal Register. For more information, contact Wendy Lader, NTIA Office of Policy Analysis and Development, at 202 482-1150 or Location: Room 4830, DOC, 1401 Constitution Ave., NW.
USITC Institutes Section 337 Investigation
8/9. The U.S. International Trade Commission (USITC) published a notice in the Federal Register announcing that on August 1, 2002 it instituted an investigation, pursuant to Section 337 of the Tariff Act of 1930, of the importation and sale of electronic dictionaries.
The petitioner is Franklin Electronic Publishers, Inc. It is the assignee of U.S. Patent No. 5,203,705, which is titled "Word spelling and definition educational device". The abstract states that it discloses "An electronic spelling correcting machine compares input term against a list of terms in memory and validates spelling and provides a set of terms which may correspond to the input term if the input term is incorrect. The validated term or suggested term is provided with a locating indicia that permits the user to go to the page in a book where definition of the meaning of the word may be found. Various word games are incorporated. ..."
The respondents are LeapFrog Enterprises, Inc., of Emeryville, California, and Jetta Company, Ltd., of Hong Kong, PRC. The administrative law judge assigned to the case is Paul Luckern. This is Inv. No. 337-TA-475.
See, Federal Register, August 9, 2002, Vol. 67, No. 154, at Pages 51868 - 51869. See also, USITC Notice of Investigation [4 pages in PDF] issued on August 6.
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