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September 26, 2002, 9:00 AM ET, Alert No. 517.
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9th Circuit Rules in Favor of Rocky Horror Cybersquatter
9/20. The U.S. Court of Appeals (9thCir) issued its opinion [PDF] in Interstellar Starship Services v. EPIX, a cybersquatting case.

Background. Epix makes and markets electronic imaging hardware and software products, and provides associated consulting services. It has registered the mark "Epix" with the USPTO. Michael Tchou, the sole founder, officer, director, and employee of Intersteller Starship Services (ISS), registered the domain name The web site associated with this URL originally promoted Tchou's technical services and digital image processing. However, it now only promotes a minor production of the Rocky Horror Picture Show (RHPS). It includes pictures of men in women's underwear.

District Court. ISS filed a complaint in U.S. District Court (DOre) against Epix seeking declaratory a judgment of non-infringement. Epix counterclaimed for trademark infringement, unfair competition, among other claims. The District Court, finding no likelihood of confusion, granted summary judgment to ISS. Epix appealed. The Appeals Court reversed and remanded. On remand to the District Court, Epix amended its complaint to include a claim of cybersquatting under the 1999 Anticybersquatting Consumer Protection Act (ACPA), 15 U.S.C. § 1125(d).

Following a bench trial, the District Court held that while ISS's past use of to promote Tchou's business infringed the Epix trademark, its present use to display RHPS pictures does not infringe the Epix trademark. The District Court also found no cybersquatting violation under the ACPA and no trademark dilution under Oregon law. The District Court refused to transfer the domain name to Epix.

Appeals Court. The Appeals Court rejected Epix's arguments on appeal that there is a likelihood of initial interest confusion among consumers, and that ISS violated the ACPA. Central to the Appeals Court's analysis on both issues was its conclusion that Tchou acted in good faith.

Affirmed. Tchou gets to keep the domain name.

House Subcommittee Holds Hearing on Check Clearing and Tech
9/25. The House Financial Services Committee's Subcommittee on Financial Institutions held a hearing on HR 5414, the Check Clearing for the 21st Century Act.

HR 5414 was introduced on September 19 by Rep. Mike Ferguson (R-NJ). It would update banking laws by giving electronic versions of checks the same legal validity as paper checks.

Roger Ferguson, the Vice Chairman of the Federal Reserve Board (FRB), stated in his prepared testimony that the bill "removes existing legal barriers to the use of new technology in check processing and holds the promise of a more efficient check collection system."

He said that while "Check processing is far more efficient than it once was ... Legal impediments, however, have prevented the banking industry from fully using these new electronic technologies, such as digital imaging, to improve check processing efficiency and provide improved services to customers."

Ferguson elaborated. "This is because existing law requires that the original paper checks be presented for payment unless the banks involved agree otherwise. ... Therefore, legal changes are needed to facilitate the use of technologies that could improve check processing efficiency, which should lead to substantial reductions in transportation and other check processing costs."

He added that "The act might also better position banks to provide new and improved services to their customers. For example, banks might allow some corporate customers to transmit their deposits electronically. Because the act will likely encourage greater investments in image technology, banks might also be able to expand their customers' access to enhanced account information and check images through the Internet."

Gail Hillebrand of the Consumers Union criticized the bill. She said that it would "make it impossible for the estimated 45.8 million U.S. households who now get their paper checks back to get all their paper checks back every month" and "not effectively protect consumers from new errors that could be caused by electronic imaging of checks." She also argued that "Information on the electronic image of a check could be used to invade consumer privacy."

See also, prepared statements of witnesses in PDF: Roger Ferguson (Federal Reserve Board), Curtis Hage (Home Federal Bank), Joel Biggerstaff (AirNet Systems), Lee Schram (NCR Corporation), Robert Fenner (National Credit Union Administration), David Walker (Electronic Check Clearing House Organization), and Gail Hillebrand (Consumers Union).

House Subcommittee Holds Hearing on DTV Transition
9/25. The House Commerce Committee's Subcommittee on Telecommunications and the Internet held a hearing on the transition to digital television. See, draft of proposed bill [16 pages in PDF] and summary of draft bill.

See also, prepared testimony of witnesses: Robert Wright (NBC), Richard Lewis (Zenith Electronics Corp.), Michael Fiorile (Dispatch Broadcast Group, on behalf of the NAB), Michael Willner (Insight Communications, on behalf of the NCTA), Lana Corbi (Crown Media USA, on behalf of the NCTA), Jim Gleason (Cable Direct, on behalf of the American Cable Association), Alan McCollough (Circuit City Stores, for the Consumer Electronics Association), Richard Lewis (Association of Public Safety Communications Officals International), Thera Bradshaw (Association of Public Safety Communications Officials), and Gene Kimmelman (Consumers Union).

NTIA Requests More Comments on E-SIGN Act
9/24. The National Telecommunications and Information Administration (NTIA) published a notice in the Federal Register that it is seeking public comments on the product recall notices exception to the E-SIGN Act.

The Electronic Signatures in Global and National Commerce (E-SIGN) Act provides, at Section 101, for the acceptance of electronic signatures in interstate commerce, with certain enumerated exceptions. Section 103 of the Act provides that "The provisions of section 101 shall not apply to ... (2) any notice of ... (D) recall of a product, or material failure of a product, that risks endangering health or safety". The Act also requires the NTIA to review, evaluate and report to Congress on each of the exceptions.

The deadline to submit written comments to the NTIA regarding the product recall notices exception is November 25, 2002. See, Federal Register, September 24, 2002, Vol. 67, No. 185, at Pages 59828 - 59830.

On September 3, the NTIA published a pair of notices in the Federal Register regarding two other exceptions -- court records and hazardous materials notices. The deadline for comments on those exceptions is November 4. See also, NTIA release, notice in Federal Register, September 3, 2002, Vol. 67, No. 170, at Pages 56277 - 56279, regarding court records, and notice in Federal Register, September 3, 2002, Vol. 67, No. 170, at Pages 56279 - 56281, regarding hazardous materials notices.

House Subcommittee Holds Hearing on Local Tax Exemption for Satellite Radio
9/25. The House Judiciary Committee's Subcommittee on Commercial and Administrative Law held a legislative hearing on HR 4869, the "Satellite Radio Freedom Act", and HR 5429, the "Satellite Services Act of 2002".

Rep. Tom Davis (R-VA) introduced HR 5429 on September 23. It would provide that "A provider of direct to subscriber satellite service shall be exempt from the collection or remittance, or both, of any tax or fee imposed by any local taxing jurisdiction on direct to subscriber satellite service".

Rep. Davis stated that "Satellite television services have been with us for a number of years, and we are now seeing the emergence of satellite radio service providers. With satellite radio, new benefits arise. Signals can be received by listeners in their vehicles, not only at home. In addition, since this service is available nationwide, it has the ability to aggregate small, dispersed listener populations, making niche educational, ethnic, religious, or specialized music programming economically feasible.

Davis (at right) He addressed "obstacle that would arise if such providers were forced to collect and remit local taxes in approximately 15,000 different jurisdictions. This reality has already been recognized in reference to satellite television, and appropriate legislative steps have been taken." Davis stated that currently Section 602 of the Telecom Act provides an exemption for satellite TV, but that "additional legislation is required to include satellite radio and certain other satellite programming services that may evolve in the future".

The bill has also been referred to the House Commerce Committee, of which Rep. Davis is a member.

Copps Addresses Media Ownership
9/25. Federal Communications Commission (FCC) Commissioner Michael Copps gave a speech in Washington DC in which he addressed the FCC's review of all of its media ownership rules, the public interest obligations of digital television broadcasters, and broadband as a civil right.

He said that "Two weeks ago the Commission commenced a far reaching review of all our media ownership rules. This was done in the context of the Congressionally mandated biennial review of FCC ownership rules, and also as a result of some occasionally curious court decisions mandating further review of these rules."

He said that "At stake is how this industry is going to look in the next generation and beyond. At stake are core values of localism, diversity, competition and maintaining the multiplicity of voices and choices that undergird our precious marketplace of ideas and that sustain American democracy. At stake ... is equal opportunity writ large -- the opportunity to hear and be heard; the opportunity to make this country as open and diverse and creative as it can possibly be; and the opportunity for jobs, career advancement, promotion and ownership in our media industries."

Copps also argued that access to broadband is a civil right. He stated that "Those who have access to advanced communications like broadband in this new century will win. Those who don’t will lose. For my part, I don’t think it exaggerates a bit to characterize access to modern communications in this modern age as a civil right. But civil rights always have to be won, don’t they? Herein, perhaps, is our next great challenge." See also, release [PDF].

Former Execs Charged
9/25. The Office of the U.S. Attorney for the Central District of California filed a criminal information in U.S. District Court (CDCal) charging John Giesecke, Joseph Shew and John Desimone. The three are former executives of, an Internet provider of real estate listings.

The information charges Giesecke and Shew with conspiracy to commit securities fraud in connection with a scheme to fraudulently inflate the earnings of The information also charges Giesecke with wire fraud, and Desimone with insider trading. The three also entered into plea agreements with the Department of Justice whereby they agreed to plead guilty. See, DOJ release and speech by Attorney General John Ashcroft.

In addition, the Securities and Exchange Commission (SEC) filed a civil complaint in U.S. District Court (CDCal) charging John Giesecke, Joseph Shew and John Desimone with securities fraud. See also, SEC release.

More Court Opinions
9/23. The U.S. Court of Appeals (5thCir) issued its opinion [22 pages in PDF] in IQ Products v. Pennzoil, a Lanham Act case involving the advertising of competing canned tire inflator products. The Appeals Court affirmed the grant of summary judgment to defendants.

9/24. The U.S. Court of Appeals (3rdCir) issued its opinion [8 pages in PDF] in Nextel v. City of Margate, a dispute over Nextel's construction of a telecommunications facility atop a condominium building. Nextel filed a complaint in U.S. District Court (DNJ) against the City of Margate and others seeking relief under 47 U.S.C. § 332(c)(7) following Margate's efforts to reopen hearings on Nextel construction of previously approved facilities. The District Court denied Nextel's motion for preliminary injunction. The Appeals Court dismissed the appeal, and vacated the District Court's order, for lack of ripeness, with further instructions to dismiss the complaint, without prejudice.

9/25. The U.S. Court of Appeals (4thCir) issued its opinion [17 pages in PDF] in In Re Carefirst of Maryland, a trademark infringement and unfair competition case. The Appeals Court did not reach the merits. It dismissed the appeal and petition for writ of mandamus as interlocutory.

More News
9/24. Sanjay Kumar, P/CEO of Computer Associates International, gave a speech regarding corporate governance and financial reporting.

9/25. The Federal Communications Commission (FCC) approved Verizon's Section 271 application to provide in-region, interLATA service in the states of Delaware and New Hampshire. See, FCC release.

9/25. The General Accounting Office (GAO) released a report [105 pages in PDF] titled "Information Management: Update on Implementation of the 1996 Electronic Freedom of Information Act Amendments".

9/18. A grand jury of the U.S. District Court (NDOhio) returned a three count indictment against Steve Wisdom. The indictment includes two counts of criminal infringement of copyrighted computer software in violation of 18 U.S.C. § 2319(b)(1) and 17 U.S.C. § 506(a), and one count of trafficking in counterfeit labels affixed or designed to be affixed to unauthorized or counterfeit copies of copyrighted computer programs in violation of 18 U.S.C. § 2318(a). See, CCIPS release.

9/16. World Trade Organization (WTO) Director General Supachai Panitchpakdi gave a speech in Geneva, Switzerland, regarding the report by the UK Commission on Intellectual Property Rights titled "Integrating Intellectual Property Rights and Development Policy".

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Thursday, September 26
The House will meet at 10:00 AM for legislative business. The House will consider several non tech related bills. See, Whip Notice.

TIME CHANGE. 9:00 AM. The House Judiciary Committee's Subcommittee on Court, the Internet and Intellectual Property will hold a hearing on HR 5211, sponsored by Rep. Howard Berman (D-CA). The bill is sometimes referred to as the "peer to peer piracy protection act", or as the "Berman bill". The scheduled witnesses include Hilary Rosen (CEO of the RIAA), Randy Saath (President of Media Defender), Phil Galdston (songwriter), Gigi Sohn (Public Knowledge). Location: Room 2141, Rayburn Building.

10:00 AM. The House Commerce Committee's Subcommittee on Commerce, Trade and Consumer Protection will hold a hearing titled "State Impediments to E-Commerce: Consumer Protection or Veiled Protectionism?" The scheduled witnesses include Rob Atkinson (Progressive Policy Institute), Tod Cohen (eBay), David Sloane (American Vintners Association), Joe Zeidner (1-800- CONTACTS), and Ted Cruz ( FTC). Rep. Cliff Stearns (R-FL) will preside. Press contact: Ken Johnson or Jon Tripp at 202 225-5735. Location: Room 2322, Rayburn Building.

10:00 AM. The Senate Judiciary Committee will hold a hearing to examine pending judicial nominations. The most important and opposed nominee is Miguel Estrada, who has been nominated to be a Judge of the U.S. Court of Appeals (DCCir). The agenda also includes five District Court nominees. Sen. Charles Schumer (D-NY) will preside. See, notice. Press contact: Mimi Devlin at 202 224-9437. Location: Room 106, Dirksen Building.

10:00 AM. The Senate Health, Education, Labor, and Pensions Committee will hold a hearings on web based education. Location: Room 430, Dirksen Building.

12:00 NOON. The FCBA will host a lunch. The speaker will be Duane Ackerman, CEO of BellSouth. The price to attend is $45 for members, $35 for government persons and law student members, and $55 for non-members. Registrations and cancellations are due by 5:00 PM on September 23. Location: Mayflower Hotel, 1127 Connecticut Avenue, State Ballroom.

3:00 PM. Niva Koren (University of Haifa Faculty of Law) will present at paper titled "Seizing Power in the Information Environment: The Comeback of the State", as a part of the George Washington University Law School Intellectual Property Workshop Series. For more information, contact Prof. Robert Brauneis at 202 994-6138. Location: Clinic Moot Court Room H 105, 716 20th Street, NW.

Friday, September 27
The House will not meet.

7:30 - 9:30 AM. The U.S. Chamber of Commerce will host a breakfast and panel discussion for technology professionals titled "Partnering Insights for Challenging Times". The scheduled speakers are Patrick Sweeney (ServerVault), Shane Oleson (Keymind division of Axiom Resources Management), Tim Grimes (Siemens Enterprise Networks), and Val Sriban (META Group). See, notice and registration page. The price to attend is $35 for the general public, and $25 for members of Partnerpoint, the U.S. Chamber, and co-sponsoring organizations. Location: U.S. Chamber of Commerce, 1615 H Street, NW.

TIME? The Federal Accounting Standards Advisory Board (FASAB) will meet to discuss issues related inter-entity costs, the Credit Reform Task Force, and other matters. See, notice in Federal Register. Location: Room 2N30, GAO Building.

Deadline to submit reply comments to the FCC regarding WorldCom's August 8, 2002, petition for declaratory ruling pursuant to 47 C.F.R. § 1.2, that requesting carriers are entitled to access ILEC Line Information Database data at cost based rates when they use such data to provide interexchange and exchange access service. See, FCC notice [PDF].

Deadline to submit reply comments to the Copyright Office (CO) regarding the motion for stay filed by various broadcasters of the CO's final rule that provides that transmissions of a broadcast signal over a digital communications network are not exempt from copyright liability under 17 U.S.C. § 114(d)(1)(A). See, notice in the Federal Register. 

Monday, September 30
9:00 AM - 4:30 PM. The President's Council of Advisors on Science and Technology will hold an open meeting. The agenda includes: the science and technology of combating terrorism, federal investment in science and technology research and development, and "demand issues that can speed the deployment of a 21st Century broadband infrastructure". See, notice in the Federal Register for pre-clearance requirements and other information. Location: Loy Henderson Conference Room, Department of State, 2201 C St., NW. Guests must use the 23rd Street entrance.

Third of three deadlines to submit proposals to the NIST for FY 2002 Advanced Technology Program funds. See, notice in Federal Register.

Deadline to submit comments to the FCC in response to it Public Notice [PDF] regarding relief for the Auction 35 winners. The FCC asks for public comments regarding two possible scenarios for providing relief to the winning bidders in the January 2001 re-auction of spectrum previously auctioned to NextWave: full refund and option to dismiss all pending applications, and selective opt out for pending applications.

Deadline to submit comments and Notices of Intention to Participate to the Copyright Office "royalty fees collected for calendar year 2000 under the section 111 cable statutory license". The CO seeks comments "as to whether a Phase I or Phase II controversy exists as to the distribution of those fees, and a Notice of Intention to Participate in a royalty distribution proceeding." See, notice in the Federal Register.

Deadline to submit comments and proposals to the Copyright Office (CO) regarding data format and delivery for record keeping requirements to be established by the CO for the Section 112 and 114 statutory licenses. See, notice [PDF].

Tuesday, October 1
9:30 AM. The Senate Commerce Committee will hold a hearings to examine the government's role in promoting the future of the telecommunications industry and broadband deployment. Location: Room 253, Russell Building.

10:00 AM. The House Commerce Committee's Subcommittee on Telecommunications and the Internet will hold a hearing titled "Recording Industry Marketing Practices: A Check-Up". Location: Room 2123, Rayburn Building.

10:00 AM. The Senate Judiciary Committee will hold a hearing to examine "recent Supreme Court jurisprudence on federalism issues". The Committee has not yet released an agenda or witness list. Nevertheless, the scope of the hearing could include the 1996 ruling in Seminole Tribe v. Florida that the Congress lacks authority under Article I of the Constitution to abrogate the States' 11th Amendment immunity from suit in federal courts. The Supreme Court extended this to the context of intellectual property in the 1999 rulings in Florida Prepaid v. College Savings Bank (invalidating the Patent and Plant Variety Protection Remedy Clarification Act) and College Savings Bank v. Florida Prepaid (invalidating the Trademark Remedy Clarification Act). Sen. Patrick Leahy (D-VT) and others have introduced S 2031, the Intellectual Property Protection Restoration Act of 2002, to stop states from evading liability for infringing IPR by asserting 11th Amendment immunity. Location: Room 226, Dirksen Building.

Wednesday, October 2
10:00 AM. The Senate Judiciary Committee will hold a hearing regarding "protecting children from child pormography". Location: Room 226, Dirksen Building.

1:30 - 3:30 PM. The FCC's WRC-03 Advisory Committee Informal Working Group 7: Regulatory Issues and Future Agendas will meet. Location: Boeing Company, Arlington, VA.