Gary Kremen registered a domain name in 1994 with Network Solutions, Inc. (NSI). Subsequently, Stephen Cohen forged a letter authorizing NSI to cancel Kremen's registration, and allowing its registration by Cohen.

Kremen sued Cohen and others, as well as NSI. Kremen has won back the domain name, and been awarded a judgment for damages against Cohen. However, Kremen cannot collect on this judgment. At issue in this order is Kremen's claim against NSI alleging fraudulent transfer. Kremen asserts that NSI is liable in tort for conversion and as a bailee. The District Court ruled in favor of NSI. Kremen appealed.

The Appeals Court reasoned that the tort of conversion is a matter of state law, that the ultimate authority is the Supreme Court of California, and that the Supreme Court of California has not yet ruled on whether a domain name is property for the purposes of the tort of conversion.

The Appeals Court could have ruled on this issue, but choose not to. Rather, it certified the question to the state court for its decision.

The Court of Appeals certified the following question: "Is an Internet domain name within the scope of property subject to the tort of conversion? (a) For the tort of conversion to apply to intangible property, is it necessary that the intangible property be merged with a document or other tangible medium? (b) If the answer to Question (a) is "yes," does the tort of conversion apply to an Internet domain name, or, more specifically, is an Internet domain name merged with a document or other tangible medium?"

Judge Alex Kozinski dissented. He wrote that "We are perfectly capable of answering both questions ourselves, and there is no indication that courts are overrun with lawsuits raising the issue. Cyberspace will not implode if the supreme court confronts the majority's questions at some point in the future rather than today".

The Electronic Privacy Information Center (EPIC) submitted a request on March 20, 2002 for records to the Office of Homeland Security (OHS) pursuant to the FOIA, 5 U.S.C. § 552. The OHS did not produce the requested records. The EPIC filed a complaint with the District Court against the OHS and Tom Ridge.

The position of the OHS is that it does not have to comply with FOIA requests because the FOIA only applies to "agencies". The FOIA, as interpreted by the courts, does not require advisers to the President, as opposed to agencies, to comply. The OHS filed motions to dismiss and for summary judgment. It filed no affidavits or other sworn testimony in support. Instead, it submitted copies of Presidential directives and an executive order. In response, the EPIC sought discovery on issues relating to whether or not the OHS is an agency within the meaning of the FOIA. The OHS opposed such discovery.

In the present order, the Court denied the motions to dismiss and for summary judgment. It wrote that the OHS "briefs and exhibits filed in support do not foreclose the possibility that OHS is an agency. ... Given that Defendants have failed to provide evidence that is definitive on the issue of the OHS's agency status and the fact the relevant evidence on this issue rests solely with the Defendant, if this Court is to rule on Defendants' Motion to Dismiss it ``must give the plaintiff the opportunity to discover evidence ...´´" (Citation omitted.)

The Court ruled that the EPIC may have sixty days "in which to complete discovery related solely to whether or not OHS is an agency." The Court added that "Discovery may not extend into the merits of this case ..."

George Kelly was convicted in the U.S. District Court (NDIll) of one count of possession of child pormography in violation of 18 U.S.C. § 2252A(a)(5)(B). The Appeals Court opinion states that he possessed "traditional child pormography", as opposed to "virtual" material. Kelly appealed, citing the opinion [PDF] of the Supreme Court in Ashcroft v. Free Speech Coalition

On April 16, 2002, the Court held unconstitutional on First Amendment and overbreadth grounds provisions of the Child Pormography Prevention Act of 1996 (CPPA) banning computer generated images depicting minors engaging in sezually explicit conduct.

The CPPA expanded the federal prohibition on child pormography to encompass new technologies. 18 U.S.C. § 2256, the section containing definitions, was amended to provide that child pormography means "any visual depiction, including any photograph, film, video, picture, or computer or computer- generated image or picture, whether made or produced by electronic, mechanical, or other means, of sezually explicit conduct, where (A) the production of such visual depiction involves the use of a minor engaging in sezually explicit conduct; (B) such visual depiction is, or appears to be, of a minor engaging in sezually explicit conduct; (C) such visual depiction has been created, adapted, or modified to appear that an identifiable minor is engaging in sezually explicit conduct; or (D) such visual depiction is advertised, promoted, presented, described, or distributed in such a manner that conveys the impression that the material is or contains a visual depiction of a minor engaging in sezually explicit conduct;"

The Appeals Court affirmed the conviction. It wrote that Free Speech Coalition strikes down only the statute's expanded definition of child pormography to encompass virtual material. The Supreme Court of the United States did not disturb longstanding precedent sanctioning Congress' ban on traditional child pormography. Mr. Kelly was convicted of possessing traditional child pornography; accordingly, we affirm the judgment of the district court.

See also, story titled "Supreme Court Upholds Speech Rights of Child Pormographers" in TLJ Daily E-Mail Alert No. 412, April 17, 2002; story titled "House Subcommittee Holds Hearing on Computer Generated Porm" in TLJ Daily E-Mail Alert No. 423, May 2, 2002; story titled "House Judiciary Committee Supports Ban on Computer Generated Child Porm" in TLJ Daily E-Mail Alert No. 454, June 19, 2002; and story titled "Bush Advocates Senate Passage of Bill Regarding Computer Generated Images" in TLJ Daily E-Mail Alert No. 534, October 24, 2002.

Editor's Note: TLJ intentionally misspells words that have caused subscribers' e-mail filtering systems to block delivery of the TLJ Daily E-Mail Alert.

The petition is titled "Petition of MSC.Software Corporation for Approval of Proposed Divestiture". It was filed in the FTC's administrative proceeding titled "In the Matter of MSC.Software Corporation". This is FTC Docket No. 9299.

On August 14, 2002, the FTC filed an administrative complaint against MSC alleging violations of Section 5 of the Federal Trade Commission Act (FTCA) and Section 7 of the Clayton Act in connection with its 1999 acquisitions of Universal Analytics, Inc. (UAI) and Computerized Structural Analysis & Research Corp. (CSAR).

MSC sells simulation software, and related services and systems. The FTC stated that MSC was the dominant supplier of Nastran software, which is an engineering simulation software program used in the aerospace and automotive industries, with an estimated 90% of worldwide revenue; UAI and CSAR each had sales of about 5% of worldwide revenue. MSC then acquired UAI and CSAR.

In August, the FTC and MSC also entered into an Agreement Containing Consent Order [22 pages PDF] which provides that MSC must divest at least one copy of its current advanced Nastran software, including the source code. The divestiture will be through royalty free, perpetual, non-exclusive licenses to one or two acquirers who must be approved by the FTC.

MSC nows requests that the FTC approve a divestiture of certain assets to Unigraphics Solutions, a wholly owned subsidiary of Electronic Data Systems (EDS). The FTC stated in a release that "These assets include a perpetual, worldwide, royalty-free, non-exclusive license to the August 14, 2002 version of the software program MSC.Nastran, to certain other assets related to that software program, and to all intellectual property rights of any kind acquired by MSC as a result of MSC's acquisitions of Universal Analytics, Inc. (UAI) and Computerized Structural Analysis & Research Corp. (CSAR)."

MSC stated in a release that "The financial terms of the transaction between MSC.Software and EDS will not be disclosed at this time."

The FTC still has to approve the proposed divestiture. Public comments on the proposed divestiture are due by February 3, 2003. For more information, contact Daniel Ducore of the FTC's Bureau of Competition at 202 326-2526.

The Tech Law Journal web site and the Tech Law Journal Daily E-Mail Alert (TLJ Alert) are both authored and published by David Carney. This is a business. The sole source of revenue for this business is subscription payments for the TLJ Alert. Yet, it is currently being widely infringed. This is undermining the financial viability of the business.

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Gramlich stated that "The issue du jour in monetary policymaking is asset price bubbles. Should the Fed have foreseen the stock market bubble of the late 1990s and limited it in some way?" He answered that "Our mandate tells us to stabilize employment and the prices of goods and services, not asset prices."

However, he added that "It may be that stabilizing asset prices is the way to stabilize goods prices and employment, but one can think of many situations in which that does not seem to be the case."

He spoke to the North American Economic and Finance Association and the Allied Social Science Association, in Washington DC on Saturday, January 4.

9:15 - 9:45 AM. Federal Communications Commission (FCC) Commissioner Jonathan Adelstein will give a keynote address at the Future of Music Policy Summit. Location: Gaston Hall, Georgetown University.

10:00 AM. The U.S. Court of Appeals (FedCir) will hear oral argument in Xerox v. 3Com, a patent infringement case involving graffiti software for hand held computers. Xerox is the assignee of U.S. Patent No. 5,596,656, which is titled "Unistrokes for Computerized Interpretation of Handwriting." Xerox filed a complaint in U.S. District Court (WDNY) against 3Com Corporation, U.S. Robotics Corporation, U.S. Robotics Access Corporation, and Palm Computing, Inc. claiming that the Graffiti software in its PalmPilot line of hand held computers infringed its unistrokes patent. Defendants asserted the affirmative defenses of invalidity, unenforceability, and non-infringement. The District Court granted summary judgment to Xerox. On October 5, 2001, the U.S. Court of Appeals (FedCir) issued its opinion in a previous appeal. It affirmed in part, reversed in part, and remanded. On December 20, 2001, the District Court issued another opinion [36 pages in PDF] in which it again granted summary judgment to Xerox. This is No. 02-1186. Location: Courtroom 201, 717 Madison Place, NW.

9:15 - 9:45 AM. Sen. Russ Feingold (D-MI) will give a keynote address at the Future of Music Policy Summit. Location: Gaston Hall, Georgetown University.

10:00 - 10:30 AM. Rep. Howard Berman (D-CA) will give a keynote address at the Future of Music Policy Summit. Location: Gaston Hall, Georgetown University.

Deadline to submit reply 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, FCC notice [4 pages in PDF].

3:00 - 5:00 PM. The National Infrastructure Advisory Council (NIAC) will meet telephonically to continue its deliberations on comments to be delivered to President Bush concerning the draft
National Strategy to Secure Cyberspace. The speakers will include John Tritak, Richard Clarke, Richard Davidson, and John Chambers. Persons interested in attending by telephone should call (toll free) 1-899-7785 or (toll) 1-913-312-4169 and, when prompted, enter pass code 1468517. See, notice in the Federal Register, December 24, 2002, Vol. 67, No. 247, at page 78415.

EXTENDED TO JAN. 31. Extended deadline to submit reply comments to the FCC in response to its requests for comments regarding whether to revise, clarify or adopt any additional rules in order to more effectively carry out Congress's directives in the Telephone Consumer Protection Act of 1991 (TCPA). This is CG Docket No. 02-278. See, original notice in the Federal Register, and notice of extension [PDF].