Tech Law Journal Daily E-Mail Alert
January 17, 2003, 10:00 AM ET, Alert No. 585.
Home Page | Calendar | Subscribe | Back Issues | Reference
Commissioners Address Media Ownership
1/16. Federal Communications Commission (FCC) Chairman Michael Powell gave a speech [MS Word] at a Columbia Law School event titled "Forum on Media Ownership". Powell stated that "We will have broadcast ownership rules at the end of this proceeding." But, he did not say what those rules will be.

Powell stated that "We will use this record to build a solid, legally defensible broadcast ownership framework. No longer will our ownership rules be based on personal bias or anecdotes about the media market. Our rules will preserve and enhance diversity, localism, and competition. And they will do so based on the media environment Americans experience every day -- digital, vibrant, and evolving."

Powell also stated that "Every two years, the Commission is required by law to review these limits on ownership. And the statute requires the FCC to presume each rule is no longer needed unless we prove otherwise. Unless we can re-justify each broadcast ownership rule under current market conditions, the rule goes away."

He added that "In the last two years, four of our ownership rules were challenged in court, and each time the rule was overturned. The court told us, in no uncertain terms, that the legal standard for reviewing the broadcast ownership rules is a rigorous one. Either we produce evidence that a rule is still necessary, or it must be eliminated."

The statute requires that the FCC "shall determine whether any of such rules are necessary in the public interest" and repeal those section that are no longer in the public interest. Recently, the U.S. Court of Appeals (DCCir) has been remanding or vacating the FCC's ownership rules.

For example, on April 2, 2002, the Appeals Court issued its opinion in Sinclair Broadcast Group v. FCC, remanding the FCC's local television ownership rule for further consideration. See, story titled "DC Circuit Remands Local TV Ownership Rule to FCC" in TLJ Daily E-Mail Alert No. 402, April 3, 2002.

Similarly, on February 19, 2002, the Appeals Court issued its opinion in Fox v. FCC. The Court held that the FCC's national TV station ownership rule (NTSO) and its cable broadcast cross ownership rule (CBCO) both violate the Administrative Procedure Act (APA) as arbitrary and capricious, and Section 202(h) of the Telecom Act. See, stories titled "DC Circuit Vacates Cable Broadcast Cross Ownership Rule", TLJ Daily E-Mail Alert No. 372, February 20, 2002, and "FCC Files Petition for Review of Appeals Court Opinion in Fox v. FCC" in TLJ Daily E-Mail Alert No. 415, April 22, 2002.

FCC Commissioner Kevin Martin gave also gave a speech at the Columbia Law School event. He stated that "The existing media ownership rules were crafted to promote three principles: competition, diversity, and localism. While the media marketplace may have changed since those rules were first adopted, our need to promote these core values has not."

He added that "the courts have insisted that we recognize that the media landscape has changed dramatically since most of the broadcast ownership rules were first enacted." He also noted that "the advent of the Internet has dramatically changed how people send and receive information. It now represents a significant outlet for diverse views, as well as an important source of news and information to consumers."

See also, the FCC's Media Ownership Policy Reexamination web site.

4th Circuit Rules First Amendment Includes Right to Receive Information
1/16. The U.S. Court of Appeals (4thCir) issued its opinion [16 pages in PDF] in Rossignol v. Voorhaar, a Section 1983 case involving interpretation of the First Amendment. It held that the Constitution protects "the intended recipients' right to receive that information and those ideas".

Rossignol publishes a small weekly newspaper in a small rural county in southern Maryland. Off duty, plain clothes sheriff's deputies traveled around the county the night before an election and systematically bought up every copy of the newspaper they could find. Rossignol was a long time critic of the incumbent Sheriff and others. The purpose of the purchases was to keep the voters from reading the election day issue.

Rossignol filed a complaint in U.S. District Court (DMd) against the Sheriff, Richard Voorhaar, and others, alleging violation of 42 U.S.C. § 1983, which provides a civil cause of action for violation of civil rights. The District Court found that the defendants did not act under color of state law, as required by the statute, and dismissed. See, 199 F. Supp. 2d 279. Rossignol appealed.

The Court of Appeals reversed. It found that the defendants did act under color of state law. However, more importantly, it found that there is can be a First Amendment violation where newspapers are purchased, and no effort is made to stop publication.

The Court wrote that "the fact that defendants paid for the newspapers in no way affects the conclusion that the seizure violated plaintiffs' right to disseminate core political speech. ... The First Amendment is about more than a publisher's right to cover his costs. Indeed, it protects both a speaker's right to communicate information and ideas to a broad audience and the intended recipients' right to receive that information and those ideas. Bd. of Educ., Island Trees Union Free Sch. Dist. No. 26 v. PICO, 457 U.S. 853, 867 (1982). Liberty of circulation is as important to freedom of the press ``as liberty of publishing; indeed, without the circulation, the publication would be of little value.´´ Lovell v. City of Griffin, 303 U.S. 444, 452 (1938) (quoting Ex parte Jackson, 96 U.S. 727, 733 (1877))." (Emphasis and parentheses in original.)

The Court did not cite that other old and famous case involving the right to hear, Red Lion v. FCC, 395 U.S. 367 (1969). The Supreme Court wrote in that case that "It is the right of the viewers and listeners, not the right of the broadcasters, which is paramount."

The Rossignol case is a 21st Century reaffirmation of the principle that freedom of speech encompasses a right in the recipient to receive information. Moreover, this case stands for the proposition that otherwise lawful commercial transactions (i.e., buying things) can implicate First Amendment rights.

This may have some importance to technology, because historically, the principle of the right to receive information has been at the heart of efforts by the Congress and the Federal Communications Commission (FCC) to regulate or mandate certain speech, and to impose media ownership rules. The latter topic is currently being reviewed by the FCC. That is, buying things (i.e., other media outlets) may decrease the diversity of voices, and hence, implicate the public's right to receive diverse viewpoints and types of information.

Chief Judge Harvie Wilkinson wrote the opinion. Born in 1944, and appointed to the 4th Circuit in 1984, Wilkinson has long been considered by Court watchers to be a possible nominee to the Supreme Court in any Republican administration.

WTO Appellate Body Holds Byrd Amendment Inconsistent With WTO Agreements
1/16. The World Trade Organization (WTO) Appellate Body released its report upholding a WTO Panel's finding that the US Continued Dumping and Subsidy Offset Act of 2000, which is also known as the CDSOA or the Byrd Amendment, is inconsistent with certain provisions of the WTO agreements on anti-dumping and on subsidies because it is a specific action against dumping or a subsidy. See, 119 page report in MS Word (442 KB) or PDF (289 KB).

The Appellate Body reversed the Panel's finding that the Byrd Amendment is inconsistent with other WTO provisions relating to the support required for initiating an investigation.

Pascal LamyEU Commissioner for Trade Pascal Lamy (at right) stated in a release that "The EU and 10 other countries had maintained that this measure clearly flies in the face of the letter and the spirit of WTO law. This was our conviction from the outset and I am glad that the Appellate Body has now clearly and definitively condemned this measure. We now expect the US to act quickly in order to repeal the Byrd amendment."

The Office of the U.S. Trade Representative (USTR) stated in a release [PDF] that "We welcome the findings in today's report that the Act is consistent with the WTO requirements for the initiation of anti-dumping or countervailing duty investigations. We are still reviewing that report, but we note that since the dispute did not involve the underlying U.S. anti-dumping and countervailing duty laws, the United States will continue to vigorously enforce those laws to ensure that U.S. industries, farmers, and workers are not forced to compete with unfairly traded imports. We are however disappointed with the Appellate Body's findings concerning the funds disbursed under the Act."

The USTR added that "The United States has been a leader in supporting rules-based dispute settlement in the WTO. Therefore, in this case as in others, the United States will seek to comply with its WTO obligations. We are reviewing the report to assess the best compliance options, and will discuss these with the Ways and Means and Finance Committees, and all other interested members of Congress."

Sen. Charles Grassley (R-IA), Chairman of the Senate Finance Committee, which has jurisdiction over most trade issues, also reacted. He said in a release that "the Byrd amendment was slipped into an appropriations conference report without full debate in the Senate. The Finance Committee, as the committee of jurisdiction, never had a chance to review the amendment. I'm not surprised that a bill that was never considered by the committee of expertise or even the full Senate is found to violate our international commitments. That's why we have committees -- to make sure things like this don’t happen."

More News
1/16. The U.S. Court of Appeals (7thCir) issued its split opinion [19 pages in PDF] in Baxter v. Abbott Labs, a patent licensing case.

1/15. Federal Trade Commission (FTC) Chairman Timothy Muris gave a speech titled "Improving the Economic Foundations of Competition Policy" at a George Mason University Symposium.

1/15. The National Telecommunications and Information Administration (NTIA) submitted a comment to the Federal Communications Commission (FCC) in response to its Report and Order and Further Notice of Proposed Rulemaking in the proceeding titled "In the Matter of Amendment of Parts 2 and 25 to Implement the Global Mobile Personal Communications by Satellite (GMPCS) Memorandum of Understanding and Arrangements. This is IB Docket No. 99-67 and RM No. 9165.

1/15. The Securities and Exchange Commission (SEC) filed a civil complaint in U.S. District Court (DUtah) against ClearOne Communications, Inc., and two of its officers, alleging violation of federal securities laws in connection with its overstatement of revenues, income and accounts receivable in Forms 10-Q and Forms 10-K. ClearOne makes video and audio conferencing products. See also, SEC release.

IRS Launches Free File
1/16. The Department of Treasury (DOT), Office of Management and Budget (OMB), and Internal Revenue Service (IRS) announced details of IRS Free File, which pertains to preparing and filing federal tax forms online.

Acting Treasury Secretary Kenneth Dam stated in a speech that "In our technologically advanced economy, electronic transactions are nearly ubiquitous. With Free File, the federal government is finally catching up to the nation we strive to support."

On October 30, 2002 the Internal Revenue Service (IRS) and Free File Alliance (FFA) signed a document [7 pages in PDF] titled "Free On-Line Electronic Tax Filing Agreement". The FFA is a consortium of companies in the electronic tax preparation and filing industry, organized as a non-profit corporation to facilitate participation in this agreement. The agreement provides that "The Consortium will offer Free Services to taxpayers. The IRS will provide taxpayers with links to the Free Services offered by the Consortium Participants through a web page ... which will be hosted at accessible through During the term of this Agreement, the IRS will not compete with the Consortium in providing free, online tax return preparation and filing services to taxpayers."

The Treasury Department and OMB stated on January 16, 2003 that "Each Free File Alliance member company sets taxpayer eligibility requirements for its own program. These requirements will differ from company to company. Generally, eligibility will be based on factors such as age, adjusted gross income, state residency, military status or eligibility to file a Form 1040EZ or for the Earned Income Tax Credit. The agreement requires the Alliance, as a whole, to provide free services for at least 60 percent or 78 million of the nation’s taxpayers during each filing season. As of January 16, 2003, the industry has exceeded that requirement. The number may fluctuate throughout the filing season as Alliance membership and offers change. The primary candidates for Free File are those taxpayers who prepare their own taxes and still file paper returns. Last filing season, the IRS received nearly 85 million paper returns and nearly 47 million e-filed returns." See, Treasury release and OMB release [PDF]

Sen. Charles Grassley (R-IA), Chairman of the Senate Finance Committee, which oversees the IRS, stated in a release that "I’m glad to see the IRS has seen the light on one of the most common criticisms of electronic filing -- that it’s too expensive -- and is advancing an effort that should provide free electronic filing to tens of millions of Americans. This is good news. A successful electronic filing program is something I've wanted for years. It should free up IRS staff and make it easier for the IRS to deliver the high quality customer service that taxpayers expect and deserve. It's also important that paper filing continues to be an option indefinitely for taxpayers who don't have to access to computers."

See also, story titled "IRS Enters Into Agreement with Electronic Tax Preparation Consortium" in TLJ Daily E-Mail Alert No. 539, October 31, 2002.

District Court Issues Ruling in Total Information Awareness FOIA Suit
1/16. The U.S. District Court (DC) issued an opinion [18 pages in PDF] in EPIC v. Department of Defense, a Freedom of Information Act (FOIA) case involving a request for records about the Defense Advanced Research Projects Agency's (DARPA) Information Awareness Office (IAO), and its program called Total Information Awareness (TIA). The Court held that the Electronic Privacy Information Center (EPIC) qualifies as a representative of the news media for the purposes of the FOIA, and thus is entitled to preferential fee status.

The EPIC submitted a FOIA request to the Department of Defense (DOD) requesting records of the DARPA. The DOD sought to charge EPIC fees for complying with this FOIA request. Charging fees -- sometimes excessive fees -- for searching for and copying records is a tactic employed by some federal agencies to deter persons from exercising their rights under the FOIA.

EPIC filed a complaint in U.S. District Court (DC). The FOIA allows agencies to charge fees. However, it also provides an exception for representatives of the news media. Courts have interpreted this exception broadly. See for example, National Security Archive v. DOD, 880 F.2d 1381 (D.C. Cir. 1989).

The EPIC filed a motion for preliminary injunction in which it argued that it qualifies for the "representative of the news media" exception. The Court held that "EPIC satisfies the definition of ``representative of the news media´´ ... EPIC's regular publication and dissemination of its biweekly electronic newsletter, as well as the publication of seven books, qualify it for preferred fee status."


Tech Law Journal is instituting several new practices and procedures with the New Year. All of these changes have one central purpose -- protecting the rights of the author, David Carney.

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.

See, Letter from the Publisher, which summarizes the new practices and procedures.

See, Subscription Information page for price schedule, methods of payment, and related matters.

See, Memorandum regarding "E-Mail Monitoring".

See, Memorandum regarding "Disclosure of Information to Third Parties".

See, Memorandum to law students explaining why free subscriptions for law students will end after the January 17 issue.

See, Memorandum regarding "Termination of state officials' subscriptions" explaining why free subscriptions for state government officials will end after the January 17 issue.

See, Subscription Form and Contract (for firms, companies, groups, and other entities), or the shorter Subscription Form and Contract (for persons subscribing individually). These contracts are for new paying subscribers, and paying subscribers renewing their subscriptions. Persons receiving free subscriptions (journalists and government officials) should not sign a contract. Paying subscribers whose subscription term has not expired should not sign a contract, until their existing subscription term expires and they resubscribe.

And finally, see revised Privacy Policy.

Friday, January 17
9:30 AM. The Senate Governmental Affairs Committee will hold a hearings on the nomination of Tom Ridge to be Secretary of Homeland Security. Location: Room 342, Dirksen Building.

EXTENDED AGAIN, TO FEBRUARY 18. Extended deadline to submit reply comments to the Federal Communications Commission (FCC) in response to its 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. See, FCC release [PDF] and Order [PDF] of October 11, 2002 extending deadlines. See also, Order [PDF] of January 3, 2003.

Monday, January 20
Martin Luther King Day. The FCC will be closed. Legal holiday.

The Securities and Exchange Commission's (SEC) final rule providing relief for Internet investment advisers goes into effect. The rule exempts certain investment advisers who provide advisory services through the Internet from the prohibition on SEC registration. The rule change permits advisers whose businesses are not connected to any state to register with the SEC instead of with state securities authorities. See also, notice in Federal Register, December 18, 2002, Vol. 67, No. 243, at Pages 77619 -77626, and story titled "SEC Amends Rule for Internet Investment Advisers" in TLJ Daily E-Mail Alert No. 568, December 16, 2002. For more information, contact Marilyn Barker or Jamey Basham 202 942-0719.

Tuesday, January 21
12:00 NOON. The Federalist Society will host a press conference titled "Federalism, Preemption & the Supreme Court ". For more information, contact Julie Walker  at 202 822-8138. Location: Holeman Lounge, National Press Club, 529 14th St. NW, 13th Floor.

12:30 PM. Sen. Ted Kennedy (D-MA) will speak at a National Press Club (NPC) luncheon. Location: Ballroom, NPC, 529 14th St. NW, 13th Floor.

Wednesday, January 22
5:00 PM. The FCBA's Diversity Committee and Young Lawyers Committee will host a Law School Outreach Program at the University of Baltimore for law students interested in practicing communications law.

6:00 - 8:00 PM. The FCBA will host a CLE seminar titled "The Transition to Digital Television". The price to attend is $60 for FCBA members, $50 for government/law student members, and $80 for non-members. Registrations & cancellations are due by 5:00 PM on January 21. RSVP to Wendy Parish Location: Wiley Rein & Fielding Conference Center, 1750 K Street, NW, 10th Floor.

Friday, January 24
Deadline to submit comments to the Federal Communications Commission (FCC) regarding the Tier III Coalition's petition to forbear, up to December 31, 2005, from enforcing the E911 accuracy and reliability standards set forth in § 20.18(h) of the FCC’s Rules with respect to Commercial Mobile Radio Service (CMRS) provided by Tier III wireless carriers. See, FCC notice [PDF]. This is WT Docket No. 02-377.
About Tech Law Journal
Tech Law Journal publishes a free access web site and subscription e-mail alert. The basic rate for a subscription to the TLJ Daily E-Mail Alert is $250 per year. However, there are discounts for subscribers with multiple recipients. Free one month trial subscriptions are available. Also, free subscriptions are available for journalists, federal elected officials, and employees of the Congress, courts, and executive branch. The TLJ web site is free access. However, copies of the TLJ Daily E-Mail Alert are not published in the web site until one month after writing. See, subscription information page.

Contact: 202-364-8882; E-mail.
P.O. Box 4851, Washington DC, 20008.
Privacy Policy
Notices & Disclaimers
Copyright 1998 - 2003 David Carney, dba Tech Law Journal. All rights reserved.