|9th Circuit Rules in Challenge to AT&T
Consumer Services Agreement
|2/11. The U.S.
Court of Appeals (9thCir) issued its
opinion [42 pages in PDF] in Ting
a class action lawsuit challenging provisions of AT&T's Consumer Services
Agreement (CSA) as a violation of California law. The District Court rejected a
federal Communications Act preemption defense, and enjoined certain provisions
of the CSA, including its ban on class actions. The Appeals Court affirmed in
part and reversed in part.
AT&T mass mailed a CSA to customers in 2000. Its
Section 4 limited AT&T’s liability for claims other than negligence to the
amount of charges for service during the affected period and precludes liability
for punitive, reliance, special, and consequential damages. Its Section 7(a)
mandated binding arbitration and bans all class wide dispute resolution. It also
contains a secrecy provision for all arbitration proceedings and requires
consumers to bring all claims within a two year limitations period. It also
stated that continuing to receive AT&T service constitutes agreement to the
terms of the CSA. It was drafted and distributed in a manner that was designed
to minimize the number of customers that would read or understand it.
Darcy Ting, an AT&T customer, on behalf of other similarly situated class
members, and Consumer Action, filed a complaint in
U.S. District Court (NDCal) against
AT&T alleging that certain provisions of AT&T's CSA violate California's
Consumer Legal Remedies Act (CLRA) and Unfair Practices Act. AT&T denied these
allegations, and further asserted that California law is preempted by the
Communications Act and the filed rate doctrine, and the Federal Arbitration Act
(FAA). The District Court held that certain provisions of the CSA are
unconscionable, and in violation of California law, and enjoined their
enforcement. It rejected the Communications Act preemption claim.
The Appeals Court also rejected the Communications Act preemption argument,
following a lengthy discussion. It also affirmed the District Court's holding on
some points, but reversed on others. For example, it affirmed the holding that
the legal remedies provisions of the CSA are unenforceable as unconscionable. It
also concluded that the "FAA preempts the CLRA's
antiwaiver provision. We therefore reverse the district court's conclusion that
the CLRA renders void the CSA's class action ban and two-year limitations
period. Because the district court did not find the two-year limitations period
unconscionable, this aspect of the CSA is revived. The other provisions remain
unenforceable as originally drafted."
|USTR Makes Proposals for FTAA
|2/11. The office of the U.S. Trade
Representative (USTR) announced that it has made an offer in the
negotiations for the Free Trade Area of the Americas. The offer includes
provisions pertaining to information technology, telecommunications, and
e-commerce. See, USTR
summary of proposal [4 pages in PDF].
Zoellick (at right) stated that "The U.S. is already a very open market. The
FTAA will benefit American farmers, workers, consumers and businesses by
reducing high tariffs and trade barriers throughout the rest of the Western
Hemisphere, while promoting regional economic growth and integration."
The USTR stated in its summary that the proposal includes "Immediate,
reciprocal elimination of tariffs offered in key sectors such as ... electrical
equipment, ... information technology ..."
The USTR summary also states that "Liberalized services and investment would
support development of critical infrastructure in FTAA economies, such as strong
banking and financial systems, modern telecommunications and e-commerce
networks, and more efficient distribution systems."
It continues that "The U.S. offers are comprehensive in scope and substance.
Market access opportunities would be provided across the U.S. services and
investment regime unless a specific reservation is taken. The U.S. offers, and
will seek from others, broad market access including but not limited to such
areas as: Financial services ... Telecommunications services ... Computer and
related services ..."
|Greenspan Discusses Role of Flexibility, Info
& Innovation in Economy
|2/11. Federal Reserve Board
(FRB) Chairman Alan
Greenspan testified before the
Senate Banking Committee on
monetary policy. He also presented the FRB's semiannual
Monetary Policy Report to the Congress. See,
He stated that "growth of economic activity slowed markedly late in the
summer and in the fourth quarter, continuing the choppy pattern that prevailed
over the past year. According to the advance estimate, real GDP expanded at an
annual rate of only 3/4 percent last quarter after surging 4 percent in the third
(at right) also addressed the long term. He said that "the most significant
lesson to be learned from recent American economic history is arguably the
importance of structural flexibility and the resilience to economic shocks that
it imparts." He elaborated that the "increased flexibility has been in part the
result of the ongoing success in liberalizing global trade, a quarter century of
bipartisan deregulation that has significantly reduced rigidities in our markets
for energy, transportation, communication, and financial services, and, of
course, the dramatic gains in information technology that have markedly enhanced
the ability of businesses to address festering economic imbalances before they
inflict significant damage. This improved ability has been facilitated further
by the increasing willingness of our workers to embrace innovation more
He added that "the benefits appear sufficiently large that we should be
placing special emphasis on searching for policies that will engender still
greater economic flexibility and dismantling policies that contribute to
unnecessary rigidity. The more flexible an economy, the greater its ability to
self-correct in response to inevitable, often unanticipated, disturbances, thus
reducing the size and consequences of cyclical imbalances. Enhanced flexibility
has the advantage of adjustments being automatic and not having to rest on the
initiatives of policymakers, which often come too late or are based on highly
Greenspan also mentioned that "Investment in equipment and software is
estimated to have risen at a 5 percent rate in real terms in the fourth quarter
and a subpar 3 percent over the four quarters of the year."
|9th Circuit Affirms in Oracle v. Falotti
|2/11. The U.S.
Court of Appeals (9thCir) issued its
[17 pages in PDF]
v. Falotti, a dispute regarding whether a former employee is entitled
unvested stock options, or stock option damages.
Oracle hired Pier Carlo
Falotti in July 1996 to be Senior Vice President for Europe, the Middle East,
and Africa. Oracle terminated him on May 31, 2000. Oracle and Falotti signed an
agreement in 1996 that provided that Oracle would grant him an option, over time
and in specified periodic installments, to purchase an initial 600,000 shares of
Oracle common stock. The agreement also provided that Oracle could terminate his
employment with or without cause. Oracle terminated Falotti four months before
he was scheduled to vest his remaining stock options worth more than $85
Oracle filed a complaint in U.S. District Court (NDCal) against
Falotti in July 2000 seeking a declaratory judgment that Falotti is neither
entitled to vest these stock options nor to receive their value as damages.
Falotti defended and counterclaimed. The District Court granted summary judgment
to Oracle. The Appeals Court affirmed.
|Tech Crime and Fraud Report
|2/10. Condor Systems, Inc. plead guilty in
U.S. District Court
(NDCal) to two felony counts of making false statements to U.S. government officials, in
18 U.S.C. § 1001.
Condor submitted false information in applications for export licenses for
Condor was also sentenced to three years probation, and ordered to pay a fine of
$1 Million. See also, story titled "Condor Systems Charged With Making False
Statements About Software in Export Application" in TLJ Daily E-Mail Alert No.
579, January 9, 2003; January 8, 2003
felony information [7 page PDF scan]; and February 10, 2003
of the U.S. Attorney's Office (USAO) for the Northern District of California.
2/7. The Securities and Exchange Commission
(SEC) filed a civil
District Court (SDFl) against
Marc Shiner and others alleging violation of federal securities laws in
connection with their "ongoing, fraudulent, unregistered offer and sale of
securities" in six limited liability partnerships that were ostensibly formed to
operate competitive local telephone exchange carriers (CLECs) in states
where Qwest Communications is an incumbent local exchange carrier (ILEC). The complaint
alleges sale of unregistered securities in violation of §§ 5(a) and 5(c) of the
Securities Act, fraud in violation of § 17(a) of the Securities Act, and fraud
in violation of § 10(b) of the Exchange Act and Rule 10b-5 thereunder,
fraud in violation of § 15(c) of the Exchange Act , and acting as an
unregistered broker dealer in violation of § 15(a) of the Exchange Act. The
District Court granted a temporary restraining order. See also,
|People and Appointments
|2/10. The Senate confirmed several nominees to be U.S. District Court Judges
by unanimous roll call votes.
John Adams (Ohio) was approved by a vote of 91-0. See,
Roll Call No. 31. James Otero (California) was approved by a vote of 94-0.
Roll Call No. 32. Robert Junell (Texas) was approved by a vote of 91-0.
Roll Call No. 33.
2/11. The Senate continues its consideration of Miquel Estrada.
President Bush stated in a
release that "Last week, the Senate began floor consideration of the
nomination of Miguel Estrada to the D.C. Circuit Court of Appeals. Mr. Estrada's
nomination was first submitted to the Senate in May 2001 -- almost two years
ago. Miguel Estrada is a well-qualified and well-respected nominee who enjoys
the bipartisan support of a majority of Senators. Fairness demands that he
receive an up-or-down vote on the Senate floor. I urge the Senate to act quickly
and allow for an up-or-down vote on this worthy candidate." President Bush also
stated at a White House event that "He has the votes necessary to be confirmed.
Yet a handful of Democrats in the Senate are playing politics with his
nomination. And it's shameful politics." See,
|2/11. The Department of Commerce's (DOC)
National Telecommunications and Information Administration (NTIA) announced
in a release that
eligibility for .edu domain names will be expanded to include more postsecondary
institutions than are currently eligible. Eligibility will be expanded from
postsecondary degree granting institutions accredited by one of the six U.S.
regional accrediting agencies, to also include institutions accredited by
agencies on the Department of Education's list
of nationally recognized accrediting agencies. See also,
2/11. February 11 was National Inventors Day. The Senate passed a
SRes 49, on February 10, recognizing that "the American people and the world
have benefited from the creations and discoveries of America's inventors; and
... the patents that protect those creations and discoveries spur technological
progress, improve the quality of life, stimulate the economy, and create jobs
for Americans". Sen. Patrick Leahy
(D-VT), the ranking Democrat on the
Senate Judiciary Committee, which has jurisdiction over intellectual
property matters, stated in the Senate that "Today's inventors are individuals
in a shop, garage or home lab. They are teams of scientists working in our
largest corporations or at our colleges and universities. In the spirit of
independent inventors, small businesses, venture capitalists and larger
corporations in Vermont and all over the United States, I would like to
recognize February 11, 2003, as ``National Inventors' Day.´´'' See, Cong. Record, Feb.
10, 2003, at S2124.
2/11. Rep. Richard Baker (R-LA) and
Rep. Mike Oxley (R-OH) introduced
HR 658 [2 pages in PDF], the Accountant, Compliance and Enforcement Staffing
Act, a bill to enable the Securities and Exchange
Commission (SEC) to more easily hire certain professionals. Specifically, it
provides that "All accountant, economist, and securities compliance examiner
positions in the Securities and Exchange Commission shall be excepted from the
competitive service, as defined in section 2102 of title 5, United States Code.
An employee who is in the competitive service at the time his or her position
becomes excepted from the competitive service under this paragraph shall be
considered as continuing in the competitive service as long as he or she
continues to occupy such position."
2/11. Herschel Abbott,
BellSouth's VP for governmental affairs, commented on the
Federal Communications Commission's (FCC) one
week delay in announcing its Report and Order in its Triennial Review of
the unbundling requirements of incumbent local exchange carriers (ILEC) and
other matters. He said, in part, that "The practical effect of the delay is
small, it allows us a few more days to make our case and we will take that
opportunity. The postponement really tells us that there is no three-vote
majority for any proposal." The FCC is now scheduled to make its announcement on
|Wednesday, February 12
|The House will meet at 10:00 AM for legislative business; the agenda
includes consideration of
The Do-Not-Call Implementation Act.
9:30 AM. The Senate Judiciary
Committee will hold a hearing on judicial nominations. The agenda includes
Timothy Tymkovich (U.S. Court of Appeals for the Tenth Circuit), Daniel Breen
(U.S.D.C., W.D. Tenn.), Thomas Varlan (U.S.D.C., E.D. Tenn.), William Steele (U.S.D.C.,
S.D. Alabama), Marian Horn (Court of Federal Claims), and Timothy Stanceu
(Court of International Trade). See,
Room 226, Dirksen Building.
10:00 AM. Federal Reserve Board
Greenspan will testify before the
House Financial Services
Committee on monetary policy and the state of the economy. Location: Room
2128, Rayburn Building.
10:00 AM to 12:00 NOON. The
Federal Communications Commission's (FCC)
Office of Engineering and Technology (OET)
will host a tutorial titled "Feature Detection and Listen Before Talk
Systems", which have possible applications for unlicensed systems. John Betz
of the Mitre Corporation will speak. See,
notice. Location: FCC, Commission Meeting Room (TW-C305), 445 12th Street
11:30 PM. Rep. Chris Cox (R-CA),
Chairman of the House Select Committee on Homeland Security, and
Rep. Jim Turner (D-TX), the ranking
Democrat, will hold a press conference. They will announce the membership of
the Committee, and review its oversight and legislative agenda. Press contact:
Kate Whitman at 202 225-5611. Location: House Radio & TV Gallery (H-321),
12:00 PM (approximate time). The
Senate Finance Committee will hold a hearing on several nominations,
including that of Charlotte Lane to be a
member of the U.S. International Trade
Commission. This hearing will commence immediately after the conclusion of
the 9:30 AM Committee hearing on proposals for economic growth. See,
[PDF]. Location: Room 215, Dirksen Building.
1:00 - 5:00 PM. The National
Telecommunications and Information Administration (NTIA) will host an
event titled "Voice Over Internet Protocol (VoIP) Roundtable". The NTIA stated
notice that the event will address VoIP "and the convergence of the
Internet and the public switched telephone network. The roundtable will
include an overview of VoIP technology, including a brief demonstration of the
Commerce Department's new VoIP telephone system." There will also be two panel
agenda. The event will be webcast. Location: Department of Commerce, 1401
Constitution Avenue, NW, Room 4830.
5:00 - 7:00 PM. The Congressional
Internet Caucus will hold its "6th Annual Kickoff Reception & Technology
Fair". The schedule includes brief statements by the Internet Caucus
Chairmen, Sen. Conrad Burns (R-MT),
Sen. Patrick Leahy (D-VT),
Rep. Bob Goodlatte (R-VA), and
Rep. Rick Boucher (D-VA), and by
Timothy Muris, Chairman of the Federal Trade
Commission (FTC) and Howard Schmidt, Acting Chairman of
the President’s Critical Infrastructure Security Board. There will also be
technology demonstrations by Advanced Biometric Systems, E-Gov OS, Full Audio
(music downloads), MovieLink, NTT DoCoMo (3G), Proxim (WiFi), University of
Virginia (telemedicine), and Xybernaut. Location: Room 902, Hart Senate Office
|Thursday, February 13
|The House will meet at 10:00 AM for legislative business.
9:00 AM - 2:00 PM. The American Enterprise
Institute (AEI) will host a conference titled "Tax,
Trade, and Cowboy Capitalism in the United States and Europe".
Rep. Bill Thomas (R-CA),
Chairman of the House Ways and Means
Committee, will give a keynote address at 9:00 AM. There will be three
panel discussions. Finally, Sen. Max
Baucus (D-MT), the ranking Democrat on the
Senate Finance Committee, will
give the luncheon address at 1:00 PM. Location: AEI, 1150 Seventeenth St., NW.
9:15 AM. The Senate Commerce
Committee will hold its organizational meeting for the 108th Congress.
notice. Press contact: Pia Pialorsi (McCain) at 202 224-2670. Location:
Room 253, Russell Building.
POSTPONED TO FEBRUARY 20.
AM. The Federal Communications
Commission (FCC) will hold a meeting. See,
Location: FCC, 445 12th Street, SW, Room TW-C05 (Commission Meeting Room).
9:30 - 11:30 AM. The Federal Communications Commission's
(FCC) Office of Engineering and Technology
(OET) will sponsor several technology demonstrations of ultra-wideband
devices. One of the participants will be
Xtreme Spectrum (XS), which will
demonstrate a wireless broadcast of two high definition television (HDTV)
streams to two separate large screen displays using XS's ultra-wideband
chipset Trinity. The FCC stated in a release that FCC staff will "be available
to the media at the beginning of the event to address regulatory actions taken
by the FCC in this area". Press contacts: David Fiske (FCC) at 202 418-0500 or
Diane Orr (XS) at 408 377-0308. See,
notice [PDF]. Location: FCC, Commission Meeting Room
(TW-C305), 445 12th St., SW.
9:30 AM. The Senate Judiciary
Committee will hold an executive business meeting. The agenda includes
consideration of several judicial nominees:
Deborah Cook (U.S. Court of Appeals for the 6th Circuit), John Roberts
(U.S. Court of Appeals for the District of Columbia), Jeffrey Sutton
(U.S. Court of Appeals for the Sixth Circuit), Jay Bybee (U.S. Court of
Appeals for the Ninth Circuit), Ralph Erickson (U.S.D.C., North Dakota),
William Quarles (U.S.D.C., Maryland), Gregory Frost (U.S.D.C., Southern
District of Ohio). The agenda also includes consideration of
S 113, a
bill to exclude United States persons from the definition of "foreign power"
under the Foreign Intelligence Surveillance Act (FISA). See,
Location: Room SDG 50, Dirksen Building.
10:00 AM. The House Science
Committee will hold a hearing on the research and development
components of President Bush's FY 2004 proposed budget. The scheduled
witnesses are John Marburger (Director of the
Office of Science and Technology Policy), Rita Colwell (Director of the
National Science Foundation), Samuel Bodman (Deputy Secretary of the
Department of Commerce), and Robert Card (Under Secretary of Energy for
Energy, Science and Environment). Press contact: Heidi Tringe at
or 202 225-4275. Location: Room 2318, Rayburn Building.
2:30 PM. The Senate Commerce
Committee will hold a hearing on "infrastructure
needs of minority serving institutions". See,
the Digital & Wireless Network Technology Program Act of 2003,
a bill to create a grant program for minority serving institutions, sponsored
by Sen. George Allen (R-VA). Press
contact: Pia Pialorsi (McCain) at 202 224-2670. See,
Location: Room 253, Russell Building.
3:00 PM. The House Ways and Means
Committee's Subcommittee on Oversight will hold a hearing titled "Free
Electronic Filing and National Taxpayer Advocate Annual Report". Location:
Room 1100, Longworth Building.
6:00-8:00 PM. The FCBA will host a reception
for Federal Communications Commission (FCC)
Adelstein. Tickets to attend must be purchased by February 10. See,
purchase form. Location:
Mayflower Hotel, Grand Ballroom, 1127 Connecticut Ave., NW.
|Friday, February 14
|9:30 AM. The
Senate Governmental Affairs
Committee will hold a hearing to examine the President's proposal to
create a terrorist threat integration center, including consolidating
intelligence analysis. Location: Room 342, Dirksen Building.
11:00 AM. The Library of Congress (LOC) will announce a plan titled
"National Digital Information Infrastructure and Preservation Program" (NDIIPP).
The scheduled speakers will include James Billington (Librarian of Congress)
and Laura Campbell (Associate Librarian for Strategic Initiatives). For more
information, contact Guy Lamolinara at 202 707-9217 or
email@example.com. Location: LOC, Mary Pickford
Theater, third floor, Madison Building, 1st St. & Independence Ave., SE.
TO BE DECIDED WITHOUT ORAL ARGUMENT.
9:30 AM. The U.S. Court of Appeals
(DCCir) will hear oral argument in Moultrie Independent Telephone
Company v. FCC, No. 01-1506. Judges Tatel, Garland and Williams will
preside. Location: 333 Constitution Ave., NW.
Deadline to submit comments to the
U.S. Court of Appeals for the Ninth
Circuit regarding the reappointment of Judge Arthur Weissbrodt, U.S.
Bankruptcy Judge for the Northern District of California, San Jose Division.
His current term expires on December 2, 2003. See,
12:00 NOON. Deadline to submit comments to the
Office of the U.S. Trade Representative (USTR)
regarding countries that deny adequate and effective protection of
intellectual property rights or deny fair and equitable market access to U.S.
persons who rely on intellectual property protection. The USTR is required by
Section 182 of the Trade Act of 1974 to make designations, commonly referred
to as Special 301 designations, of countries that deny adequate
protection, or market access, for IPR. See,
19 U.S.C. § 2242.
notice in the Federal Register, December 30, 2002, Vol. 67, No. 250, at
Pages 79683 - 79684.
|Monday, February 17
|Presidents Day. The House will be in recess for the Presidents Day
District Work Period from February 17 through 21. The FCC will be closed on
|Tuesday, February 18
|9:30 AM. The U.S. Court of Appeals
(DCCir) will hear oral argument in AT&T v. FCC, No. 01-1485. Judges
Tatel, Garland and Williams will preside. Location: 333 Constitution Ave., NW.
4:00 PM. Michael
Meurer (Boston University School of Law) will present a paper titled
"Sharing Copyrighted Works". For more information, contact
Robert Brauneis at
202 994-6138 or
firstname.lastname@example.org. Location: George Washington University Law
School, Faculty Conference Center, Burns Building, 5th Floor, 720 20th Street,
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.
Deadline to submit reply comments to the
Federal Communications Commission (FCC)
in response to its
Notice of Inquiry (NOI) in the proceeding titled "In the matter of
Facilitating the Provision of Spectrum Based Services to Rural Areas and
Promoting Opportunities for Rural Telephone Companies To Provide Spectrum Based
Services". This is WT Docket No. 02-381. For more information, contact
Robert Krinsky at 202 418-0660. See also,
notice in the Federal Register, January 7, 2003, Vol. 68, No. 4, at Pages
723 - 730.
Extended deadline to submit comments to the
Federal Communications Commission (FCC)
in response to its Further Notice of Proposed Rulemaking, (FNPRM), released
last month, regarding whether providers of various services and devices not
currently within the scope of the FCC's 911 rules should be required to
provide access to emergency services. This is CC Docket No. 94-102 and IB
Docket No. 99-67. See,
notice in the Federal Register, January 23, 2003, Vol. 68, No. 15, at
Pages 3214 - 3220, and
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