|Bush Signs E-Government Act
|12/17. President Bush signed
the E-Government Act of 2002. He said in a
signing statement that this bill ensures "strong leadership of the
information technology activities of Federal agencies, a comprehensive framework
for information security standards and programs, and uniform safeguards to
protect the confidentiality of information provided by the public for
He added that "The Act will also assist in expanding the use of the Internet
and computer resources in order to deliver Government services, consistent with
the reform principles I outlined on July 10, 2002, for a citizen centered,
results oriented, and market based Government."
The bill also provides that federal government agencies will have to conduct
privacy impact assessments before developing or procuring information technology
or initiating any new collections of personally identifiable information.
The bill was sponsored by Rep. Jim
Turner (D-TX). The original Senate version
of the bill, S 803, was sponsored by Sen.
Joe Lieberman (D-CT), Sen.
Conrad Burns (R-MT), and others.
|FCC Releases Semiannual Broadband Data
|12/17. The Federal Communications
(FCC) released a semi-annual report titled "High Speed Services for Internet
Access: Status as of June 30, 2002". The report states that the number of
broadband lines grew from 12.8 Million to 16.2 Million -- a 27% increase in the
first half of 2002. This
follows upon a 33% increase in the second half of 2001. See, two page
[PDF] and nineteen page
and report [PDF].
The report also reveals the trend that broadband access is increasingly
being provided by two types
of services, and by two types of providers. First, there is asymetric digital
subscriber line (ADSL) service
provided by the incumbent local exchange carriers (ILECs). Second, there is
cable modem service provided by cable companies.
The report states that there are 16,202,540 total lines. Of these, 5,101,493
are ADSL lines, the vast majority of which are provided by ILECs. Very
few are provided by competitive local exchange carriers (CLECs). The report
states that only 226,249 ADSL lines
were provided by non-ILECs. This amounts to only 4.4% of ADSL lines.
Then, 9,172,895 broadband lines are cable lines.
The report also states that there are 520,884 fiber lines. This statistic grew at
a rate of 5% in the first half of 2002, which is a growth rate far less than the
overall rate. The report also states that there are
220,588 satellite and fixed wireless channels, and that this statistic grew at a
rate of 4%.
Since there is little overbuilding in the cable industry, and
the RBOCs tend not to enter the territories of other RBOCs, the emerging trend
is of competition in each area between one ILEC providing ADSL service,
and a cable company providing cable modem service.
The report was written by the FCC's Wireline Competition Bureau's Industry
Analysis and Technology Division.
|Tom Ridge Discusses Cyber Security with
held a meeting with future employees of the new Department
of Homeland Security. He answered questions about, among other things, cyber
infrastructures, and science and technology. See,
Ridge was asked whether the "Office of Cyber Security and your Office of
Homeland Security ... [will] continue, or will they be merged into the new
department?" Ridge responded that the "Office of Homeland Security, as
the President indicated
during the -- our discussion on the Hill with regard to the creation of the new
department, will remain in the White House. And how it relates to either the
existing Office of Cyber Security, I really can't answer that question. I do not
Ridge (at right) added, "I thank you for giving the kind of
public tribute you did to Dick Clark and
his Cyber Security folks and others. When people think of critical
infrastructure, they have a tendency to think of bricks and mortar. But given
the interdependency of just about every physical piece of critical
infrastructure, energy, telecommunications, financial institutions and the like
with the Internet and the cyber side of their business, we need to be focused on
both, and will be. But how those two will relate after the new department is hooked up, I cannot
tell you. I don't know at this point."
Ridge was also asked how the new department will work with the private sector
on critical infrastructure protection. Ridge stated that "We are close to
completing a strategy to deal with -- well, strategy doesn't mean much to folks,
so let me just distill it. We've got a way forward so that we can work with the
private sector to assess how they're vulnerable, to share best practices, to
reduce their vulnerability. And it will be one of the primary functions of this
new department because we're going to get a lot of information in, a lot of
threat information. We're going to have analysts working -- not only in
Washington -- but elsewhere, whose responsibility will be to work with the
private sector to shore up those vulnerabilities."
Ridge continued that "The notion behind the President's initiative --
the notion behind the
President's initiative was, first of all we got to map the vulnerabilities in
this country. And one of the provisions in the new -- the legislation that
created the department was a freedom of information exemption. So that when
we're working with the private sector and we're asking them -- and they work
very closely with us -- but we need to know where you view yourselves as most
vulnerable. That's not exactly information we want to share with the rest of the
world. So we have that Freedom of Information Act exemption."
Ridge also discussed science and technology. He stated that "One of the
units that the President proposed and the Congress really
enthusiastically embraced within the new department is a unit that will deal
with the science and technology that we think we need to deploy in this country
to help us combat terrorism, the technology of detection. It goes across the
board. There are literally hundreds, if not thousands of companies, that have
already seen an area where they believe technology can enhance our ability to
|FTC and DOJ Support Grant of Certiorari in
Verizon v. Trinko Antitrust Case
|12/17. The Federal Trade Commission (FTC)
announced that it has approved the filing of a joint
[26 pages in PDF] along with the Department of Justice
(DOJ), as amici curiae, in the matter of Verizon
v. Law Offices of Curtis V. Trinko,
urging the Supreme Court to grant the petition for writ of certiorari.
This is an amicus brief submitted, not on the merits of the case, but rather
on the issue of whether the Supreme
Court should hear the case (i.e., grant certiorari).
Verizon seeks review of an
of the U.S. Court of Appeals (2ndCir)
in a case involving the application of Section 2 of the Sherman Antitrust Act,
15 U.S.C. § 2, in the
context of telecommunications.
The FTC stated in a
release that this case concerns the standards for liability "with respect to
claims that an alleged monopolist denied access to an ``essential facility,´´
and engaged in ``monopoly leveraging.´´"
The amicus brief states that the question presented is "Whether,
in reversing the dismissal of a complaint for failure to state a claim upon
which relief may be granted under Section 2 of the Sherman Act, 15 U.S.C. 2, the
court of appeals erred by relying on a standard of liability that does not
require predatory or exclusionary conduct."
The brief elaborates that "The Second Circuit's decision in this
case dramatically expands antitrust liability for failure to assist rivals. It
conflicts with the decisions of other courts of appeals, including
Goldwasser v. Ameritech Corp., 222 F.3d 390 (7th Cir. 2000), which
held that ``similar
allegations of monopolistic conduct´´ did not state a claim upon which relief
may be granted. ... The Second Circuit’s
decision is erroneous. And it will have significant practical consequences,
particularly for the telecommunications industry as it adapts to the fundamental
regulatory changes wrought by the Telecommunications Act of 1996."
The FTC/DOJ brief continues that "The 1996 Act requires
incumbent telecommunications carriers to assist their rivals by providing them
with access to their networks under legislatively and administratively developed
conditions and formulae. [citing
Verizon v. FCC] This Court has recognized the importance of that complex
legislation and the industry it restructures by granting review in two cases
raising statutory interpretation issues. See Verizon v. FCC,
supra; AT&T v. Iowa Utils. Bd.,
525 U.S. 366 (1999). This case raises similarly important issues. In the courts
of appeals, the United States and the FCC have filed briefs as amici curiae
urging, among other things, the rejection
of any construction of the 1996 Act that would render it an implied repeal of
the antitrust laws in this important sector of the economy. Well-established
principles preclude recognition of such immunity absent clear repugnancy between
the antitrust laws and a regulatory statute, Carnation Co. v. Pacific Westbound
383 U.S. 213, 218 (1966); Otter Tail Power Co. v. United States,
410 U.S. 366, 372-375 (1973), and any implied repeal would contravene the 1996
Act’s declaration that it should not ``be
construed to modify, impair, or supersede the applicability of any of the
See 47 U.S.C. 152 note. The Second Circuit in this case, like the Seventh
Circuit in Goldwasser, correctly concluded that the 1996 Act does not
immunize petitioner's conduct from scrutiny under the antitrust laws. ..."
"Nonetheless, the 1996 Act's imposition of new duties to assist
rivals -- coupled with the increasing number of antitrust lawsuits predicated on
alleged noncompliance with the 1996 Act -- have given new urgency to careful
examination of the circumstances under which antitrust law requires a
dominant firm to provide such
assistance. The Second Circuit's decision unduly expands those circumstances by
endorsing essential facilities and monopoly leveraging theories that are
uncabined by any requirement that the challenged conduct be exclusionary or
predatory -- i.e., that the refusal not make economic sense except
as an effort to diminish competition. That approach improperly trivializes the
antitrust laws and encourages litigants to seek antitrust remedies for ordinary
commercial and regulatory disputes. The decision and the many lawsuits based on
the theories it endorses, moreover, could threaten substantial disruption of the
telecommunications industry. Accordingly, the petition for a writ of certiorari
should be granted", the FTC/DOJ brief concludes.
|EPIC Files FOIA Complaint and TRO Motion
Against DOD Seeking Total Information Awareness Records
|12/17. The Electronic Privacy Information
Center (EPIC) filed a
[PDF] in U.S. District Court (DC)
against the Department of Defense (DOD) alleging violation of the
Freedom of Information
Act (FOIA). The EPIC seeks records from the
Defense Advanced Research Projects Agency (DARPA) regarding its
Information Awareness Office (IAO), and
the program sometimes called Total Information Awareness (TIA).
The EPIC also filed a
Temporary Restraining Order and a Preliminary Injunction, and Memorandum in
Support [23 pages in PDF]. The EPIC moves for
expedited processing of it FOIA request for records. This is the second action
that the EPIC has brought against the DOD in connection with TIA records.
The IAO web site states that its mission is
to "imagine, develop, apply, integrate, demonstrate and transition information
technologies, components and prototype, closed loop, information systems that
will counter asymmetric threats by achieving total information awareness useful
for preemption; national security warning; and national security decision
Sobel (at right), General
Counsel of the EPIC, stated in a release that "The ``Total Information Awareness´´
program is developing data-mining tools that will sort through massive amounts
of personal information, including financial, medical, communications, and
travel records as well as new sources of information."
He added that "The Pentagon has tried to stonewall us on this subject for
almost a year, and it is clearly time for the court to intervene. The law in
this area is crystal clear and there is no legal basis for DoD's obstruction of
our efforts to learn more about this controversial program."
The EPIC argues in the present TRO motion that "In violation of both the FOIA
and its own regulations, defendant DoD has denied plaintiff's request for
expedited processing of requested records concerning TIA and has failed to
render a determination of plaintiff's administrative appeal of that
determination within the legal time limit. Because time is at the essence of
plaintiff's rights and defendant's obligations, plaintiff seeks the Court's
expedited consideration of this matter and entry of an order compelling
defendant to expedite the processing of plaintiff's FOIA request in the manner
required by DoD's regulations."
Judge Bates is presiding. The EPIC also
stated in a December 17 release that the Court "is likely
to schedule a hearing on EPIC's request within the next 48 hours."
|EPIC Files Amicus Brief in USA v. Bach
|12/17. The Electronic Privacy
Information Center (EPIC) filed an amicus curiae
[PDF] to the petition for rehearing en banc in USA
v. Bach. On November 18, the U.S.
Court of Appeals (8thCir) issued its
holding that a search of an Internet service provider's electronic mail records,
by the ISP's employees, pursuant to a state subpoena, without the presence of a
law enforcement officer, is not unreasonable under the Fourth Amendment. The
Court of Appeals reversed the District Court's holding that seizure of e-mails
by Yahoo personnel from Yahoo's servers violated
18 U.S.C. § 3105 and Minnesota
statutes, and thus the Fourth Amendment.
See, story titled "8th Circuit Holds 4th Amendment Does Not Require Presence
of Officer at ISP Searches" in
TLJ Daily E-Mail Alert No 552, November 19, 2002.
The EPIC argues that the opinion of the three judge panel of the Court of
Appeals "entirely fails to account for the fact that the justification for
having a search performed by someone other than a police officer is distinct
from and does not merit removing the requirement that an officer be present to
serve the warrant. The procedural requirement that an officer be present to
serve a warrant, established by statute and upheld by the district court, is
necessary to prevent encroachment upon well-established Constitutional
protections. The opinion of the Eighth Circuit panel essentially creates a
regime in which a police officer presence has been eliminated from the warrant
process, in which an individual's privacy can be invaded simply by turning on a
|Jury Acquits ElcomSoft in DMCA
|12/17. A jury of the U.S. District
Court (NDCal) returned a verdict of
not guilty in the criminal case brought by the U.S. Attorneys Office for the
Northern District of California against ElcomSoft.
The government charged the
company with criminal violation of the anti-circumvention provisions of the
Digital Millennium Copyright Act (DMCA).
Adobe Systems makes the
a program which can read books in an electronic format named eBook. The program
is downloadable at Adobe's web site. Users can then purchase encrypted
electronic books in eBook format from online bookstores, such as Amazon.com, and
read them with the eBook Reader. The books are encrypted to protect copyright
interests. ElcomSoft made a commercial software product named Advanced eBook
Processor that enables people to copy and read these electronic books without
paying. This program circumvents the Adobe Acrobat eBook Reader by removing all
limitations on an eBook purchaser's ability to copy, distribute, and print
Rick Boucher (D-VA) (at right), a leading critic of the DMCA in Congress,
stated that "While this jury had the good judgment not to
convict ElcomSoft for advancing a technology that could be used in lawful ways,
a future jury in another similar case may reach a different decision. The threat
of civil liability and potential federal criminal liability under the
overreaching DMCA is all too real and broadly will inhibit the willingness of
companies to introduce technology which will facilitate the exercise of fair use
rights but which also could be used to facilitate piracy."
Rep. Boucher is the sponsor, along with
Rep. John Doolittle (R-CA), of the
Digital Media Consumers’ Rights Act of 2002, a bill that would, among other
things, amend Section
1201 of the DMCA to provide that the only time the act of circumvention is
prohibited is when the purpose of the circumvention is to infringe a copyright.
story titled "Reps. Boucher and Doolittle Introduce Digital Media Consumer
Rights Act", October 3, 2002.
Rep. Boucher added that "The Digital Media Consumers' Rights Act, the
legislation that I have introduced which would enable manufacturers to introduce
multipurpose technology as long as it is capable of substantial non-infringing
use, is needed and will go forward."
|State Department Official
Addresses Trans-Atlantic Trade
|12/9. Anthony Wayne, Assistant Secretary for Economic and Business Affairs,
gave an upbeat
in Athens, Greece, titled "The U.S. and the EU Today: Trade and Economic Issues
in the Trans-Atlantic Relationship". He stated that "The reality is
that on economic policy as well as on foreign
policy, the U.S. and the EU collaborate on far more than we fight."
He cited the
Technology Agreement as an example. He stated that "The convergence
of our trade interests at times manifests itself in
trade liberalizing initiatives from the private sectors on both sides
of the Atlantic. My favorite is the Information Technology Agreement,
which was a joint initiative of the U.S. and European IT sectors
together, asking governments to eliminate duties and quotas hampering
trade and innovation in this fast-growing (or formerly fast-growing)
sector. The ITA initially caught us by surprise in government, but
when we looked at it we said why not? In all, nearly 30 countries
joined us in 1995 in eliminating duties on IT and networking
equipment, and the laptop in your bag probably became more affordable
as a result." (Parentheses in original.)
He stated that the "U.S.-EU antitrust cooperation is ongoing,
substantive and effective."
He also said that "President Bush made a firm commitment to get Congressional support
to change the Foreign Sales Corporation tax provisions. In light of
this commitment, mirrored by key congressional leaders, the EU decided
not to use, for now, its WTO authorization to retaliate against us."
He also offered recommendations for policies that are "necessary for
restoring more vigorous and lasting economic growth", including "Lowering
barriers to trade", "Promoting high-tech investments for productivity enhancement", and
"Freer transmission of technological innovations".
|Wednesday, December 18
|1:00 PM. The Federal Trade Commission
(FTC) will hold a press conference "to announce a consumer protection
initiative". See, FTC
notice. Location: Room 432, FTC HQ, 600 Pennsylvania Ave., NW.
Deadline to submit comments to the FCC regarding AT&T's
petition for declaratory ruling that its phone to phone Internet protocol
telephony services are exempt from access charges. AT&T filed the petition on
October 18, 2002. This is WC Docket No. 02-361.
For more information, contact Kathy O’Neill at 202
418-1520 or Julie Veach at 202 418-1558. See,
notice [4 pages in PDF].
|Thursday, December 19
|Deadline for the
to rule on SBC's Section 271 application
with the FCC to provide in region interLATA service in the state of
California. This is WC Docket No. 02-306. See,
FCC notice [PDF].
Deadline for the
to rule on BellSouth's Section 271
application with the FCC to provide in region interLATA service in the states
of Florida and Tennessee. This is WC Docket No. 02-307. See,
FCC notice [PDF].
1:00 - 4:00 PM. The
U.S. Patent and Trademark Office (USPTO)
will host a roundtable meeting. The USPTO has offered two descriptions of the
purpose of this meeting. It stated in an October 28
in the Federal Register that the meeting will address small
business views on foreign patent challenges. It stated in a December 9
notice that the meeting will address harmonization of patent laws. This
roundtable, along with two others in Los Angeles and Chicago, are being held
pursuant to a recommendation contained in a
General Accounting Office (GAO)
report [PDF] titled
"Federal Action Needed to Help Small Businesses Address Foreign Patent
Challenges". This report was released on August 22, 2002. See also, story
titled "GAO Reports Foreign Patent Challenges Facing Small Businesses" in
TLJ Daily E-Mail
Alert No. 497, August 23, 2002. December 19 is also the deadline to submit
written comments. To make reservations to attend, contact Velica Steadman at
703 305-9300 or email@example.com.
Location: Crystal Park 2, 2121 Crystal Drive, Arlington, VA.
|Friday, December 20
|Deadline to submit comments to the Office of the
U.S. Trade Representative (USTR) regarding
its proposed free trade agreement (FTA) negotiations with Botswana, Lesotho,
Namibia, South Africa and Swaziland. The proposed negotiations will address,
among other things, electronic commerce, intellectual property rights (IPR),
and access to telecommunications markets. See,
in Federal Register, November 15, 2002, Vol. 67, No. 221, at Pages 69295 -
69297. See also,
[PDF] from USTR Robert Zoellick to Sen. Robert Byrd (D-WV).
|Tech Crime Report
|12/11. The U.S.
District Court (NDCal)
sentenced Gary Jones to 46 months in prison for wire fraud in violation of
18 U.S.C. § 1343.
Jones worked as a regional sales representatives in the Fairfax,
Virginia office of Sagent Technology, a
Mountain View, California company that makes business intelligence software.
Jones received approximately $428,383 in commission and bonus payments to which
he was not entitled by reporting sales to government agencies that did not take
place. See, USAO
12/16. The U.S.
Court of Appeals (8thCir) issued its unpublished
pages in PDF] in USA
affirming the conviction of a Gateway employee and his wife for mail fraud in
§ 1346, and conspiracy in violation of
18 U.S.C. § 371.
12/17. The U.S. District Court
(NDTex) unsealed an indictment that was returned by a grand jury on November
20, 2002 against Clayton Fuchs, Waldrick Lemons, Stephen Thompson, Robert Ogle,
Kenneth Speak, and Eugene Gonzales in connection with the operation of a web
based pharmacy and the distribution of
controlled substance. The U.S. Attorneys Office (USAO) stated in a
that Fuchs, a pharmacist who was licensed in the state of Texas, was the owner
or operator of Friendly Pharmacy, a web based pharmacy. The USAO further stated
that Thompson, Ogle, and Speak are doctors who wrote prescriptions for
hydrocodone without face to face contact with customers. Fuchs is charged with
conspiracy to distribute a controlled substance in violation of 21 U.S.C. § 846,
operating a continuing criminal enterprise in violation of 21 U.S.C. § 848,
and money laundering in violation of 18 U.S.C. §§ 1956 and 1957. The doctors are
charged with conspiracy to distribute a controlled substance.
12/16. The U.S. District Court
(CDCal) sentenced Mohamad Mostafa to 44 months in a federal prison
for his involvement in a conspiracy to sell counterfeit baby formula. He was
previously convicted of conspiracy, misbranding food after being held for sale
in interstate commerce, and trafficking in counterfeit goods. He
had fled the U.S. in 1995, and was not arrested until 2001. See,
release. This was not a technology related crime. However, this matter was
frequently cited by proponents of legislation that would have amended the Lanham
Act to prohibit the removal or alteration of product identification codes. See,
HR 2100 (106th Congress), sponsored by
Rep. Bob Goodlatte (R-VA) and
Rep. Zoe Lofgren (D-CA). See also,
HR 2100: The Antitampering Act of 2000.
This legislation would have created an additional quasi intellectual
property remedy that would have been available to producers of tech products --
not just baby formula makers. However, the bill did not become law.
|People and Appointments
|12/17. Nicholas Calio resigned from his position as President Bush's
congressional liaison, effective January 10, 2003. See,
statement by President Bush.
12/17. Kate Whitman was named Communications Director for
Rep. Chris Cox (R-CA). Rep. Cox is a
member of the House Commerce
Committee, and its Telecom and Internet Subcommittee. He is also Chairman of
the Republican's House Policy Committee.
12/17. Six board members of WorldCom resigned:
John Sidgmore, Carl Aycock, Max Bobbitt, Francesco Galesi,
Gordon Macklin, and Bert Roberts. The board is now reduced to
Michael Capellas, Nicholas Katzenbach, Dennis Beresford, and
|12/17. The Maryland Public Service
announced that it would support Verizon's
application to the Federal
Communications Commission (FCC) to offer in region interLATA services in the
state of Maryland. William Roberts, President of Verizon Maryland, stated in a
release that "We will move forward quickly to make our case for Verizon
long distance to the Federal Communications Commission."
12/17. The U.S. Court of Appeals
(9thCir) issued its
order [2 pages in PDF] that the case Kyocera Corporation v. Prudential Bache be
reheard by the Ninth Circuit en banc.
12/17. The Copyright Office published a
notice in the Federal Register
containing final regulations adjusting the royalty rates and terms, pursuant to
§ 118, for the noncommercial educational
broadcasting compulsory license for the period 2003 through 2007. These rules
take effect on January 1, 2003. See, Federal Register, December 17, 2002, Vol.
67, No. 242, at Pages 77170 - 77173. For more information, contact David
Carson (General Counsel) or William
Roberts (Senior Attorney, CARP) at 202 707-8380.
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