Tech Law Journal Daily E-Mail Alert
October 9, 2003, 9:00 AM ET, Alert No. 756.
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House Approves Bill to Limit P2P File Sharing at Government Agencies

10/8. The House approved HR 3159, the "Government Network Security Act of 2003" by a voice vote. This bill requires federal government agencies to develop and implement plans to protect the security and privacy of government computer systems from the risks posed by peer-to-peer (P2P) file sharing.

HR 3159 is sponsored by Rep. Henry Waxman (D-CA), Rep. Tom Davis (R-VA), and others. Rep. Davis on October 8 stated that "file sharing programs create a number of risks for federal departments and agencies if they are installed on government computers. The federal government uses and stores a wide variety of classified and sensitive information, including information vital to national security, public health, and the personal and financial records of U.S. citizens and businesses. Installing these programs on government computers can cause this sensitive information to be exposed to the public. Because files are shared anonymously on peer to peer networks, there is also a risk of the spread of viruses, worms, and other malicious computer files."

See, stories titled "Representatives Introduce Bill to Protect Children from P2P Smut" in TLJ Daily E-Mail Alert No. 706, July 29, 2003; and "House Committee Passes Bill to Restrict P2P File Sharing on Computers and Networks of Federal Agencies" in TLJ Daily E-Mail Alert No. 749, September 30, 2003.

The Senate has not passed this bill. However, the Senate Judiciary Committee has held hearings that have addressed the use of P2P software at government agencies. See, stories titled "Senate Committee Holds Hearing on P2P Networks" in TLJ Daily E-Mail Alert No. 683, June 18, 2003; and "Senate Judiciary Committee Hears Testimony on Copyright Infringement on P2P Networks" and "Senate Judiciary Committee Hears Testimony on Porm on P2P Networks", in TLJ Daily E-Mail Alert No. 736, September 10, 2003.

FCC Issues LNP Order

10/7. The Federal Communications Commission (FCC) issued a Memorandum Opinion and Order (MOO) [pages in PDF] in its proceeding titled "In the Matter of Telephone Number Portability -- Carrier Requests for Clarification of Wireless-Wireless Porting Issues". This MOO addresses wireless-wireless, but not wireless-wireline, local number portability (LNP) issues.

The MOO states that it offers "further guidance to the industry as it nears the November 24, 2003, deadline to provide wireless local number portability (LNP). The guidance we offer today is applicable to wireless-wireless porting only. We intend to address issues related to wireline-wireless porting in a separate order. Today, in response to a Petition for Declaratory Ruling/Application for Review, we hold that while carriers may agree to rules with their customers via contract, such rules may not restrict carriers' obligations to port numbers to other carriers upon receipt of a valid request to do so." (Footnote omitted.)

The MOO continues that "we address several separate LNP implementation issues that have been raised in the context of the Cellular Telecommunications & Internet Association's May 13th Petition for Declaratory Ruling. We clarify that wireless carriers may not refuse a request to provide LNP from another wireless carrier on the basis of the lack of proximity of the requesting carrier’s switch to the porting out carrier’s switch. We confirm also that interconnection agreements are not required for wireless to wireless porting and that, in cases where wireless carriers are unable to reach agreement regarding the terms and conditions of porting, all such carriers must port numbers upon receipt of a valid request from another carrier, with no conditions. We encourage wireless carriers to complete ``simple´´ ports within the industry-established two and one half hour porting interval. We find that no action is necessary regarding the porting of numbers served by Type 1 interconnection because carriers are migrating these numbers to switches served by Type 2 interconnection or are otherwise developing solutions. Finally, we reiterate the requirement that wireless carriers support roaming nationwide for customers with pooled and ported numbers, and we address outstanding petitions for waiver of the roaming requirement." (Footnote omitted.)

Tom Wheeler, P/CEO of the Cellular Telecommunications & Internet Association (CTIA), stated in a release that "The industry is hard at work implementing these daunting upgrades. But with the deadline only 49 days away, the Commission still has not answered some basic implementation questions ... The FCC has simultaneously managed to tie the industry's hands and hold our feet to the fire." He added that "The Commission has yet to determine when a wireline carrier must port a customer's telephone number to a wireless carrier. If this issue is not resolved, the practical effect is that 85% of wireline customers will NOT be able to port to wireless."

This is FCC 03-237, in CC Docket No. 95-116.

Reaction to 9th Circuit Opinion in Brand X Internet Services v. FCC

10/8. Daniel Brenner, SVP, Law and Regulatory Policy, at the National Cable Telecommunications Association (NCTA) released a statement regarding the October 6 opinion [39 pages in PDF] of the U.S. Court of Appeals (9thCir) in Brand X Internet Services v. FCC vacating the Federal Communications Commission's (FCC) declaratory ruling that cable modem service is an information service, and that there is no separate offering as a telecommunications service.

The FCC adopted a Declaratory Ruling and Notice of Proposed Rulemaking [75 pages in PDF] at its March 14, 2002 meeting. This is FCC 02-77 in Docket No. 00-185 and Docket No. 02-52. See, TLJ story titled "9th Circuit Vacates FCC Declaratory Ruling That Cable Modem Service is an Information Service Without a Separate Offering of a Telecommunications Service", also published in TLJ Daily E-Mail Alert No. 754, October 7, 2003.

Brenner wrote that "The decision is a strained reading of an earlier Ninth Circuit case to which the three-judge panel felt legally bound. By virtue of the prior decision in AT&T v. City of Portland, the panel felt compelled to characterize cable modem service as a telecommunications service, a legally erroneous conclusion that neither Congress nor any other U.S. court has ever reached. Well-established U.S. Supreme Court precedent provides that where a statute is ambiguous, courts are compelled to defer to reasonable agency interpretations. Because of the odd legal juxtaposition of the Brand X appeal and the prior Portland case, the panel failed to defer to the FCC." He added that the "NCTA fully supports an FCC appeal."

Meanwhile, Randolph May of the Progress & Freedom Foundation (PFF) stated that "The Commission should not allow the Ninth Circuit's panel decision to prevent it from proceeding promptly to do whatever is necessary to ensure that cable broadband services are free from traditional common carrier regulation ... Even if the Ninth Circuit's legally questionable interpretation concerning the classification of cable modem services were correct, the FCC has authority under the 1996 Act, and already has compiled a sufficient record, to forbear from regulating broadband services. In light of the competitive nature of the services, the agency should exercise such authority without delay."  See, FCC release.

In contrast, Dave Baker, VP of law and public policy at EarthLink (which challenged the FCC's declaratory ruling), stated that the 9th Circuit's opinion "vindicates what EarthLink has been telling the FCC for five years now, that cable modem service contains a telecommunications service. As the Court noted in its decision, ‘The practical result of such a classification is that cable broadband providers would be required to open their lines to competing ISPs.’ Cable modem users deserve choice in high-speed Internet providers. Today’s ruling is a big step towards finally affording them that choice." See, release.

FRB's Ferguson Addresses Impact of Information Technology on Financial Services

10/8. Federal Reserve Board (FRB) Vice Chairman Roger Ferguson gave a speech in Boston, Massachusetts titled "The Future of Financial Services -- Revisited". He discussed the impact of technological change on both the production and consumption of financial services.

Roger FergusonFerguson (at right) discussed how financial institutions have used new technologies to better manage risk. He stated that "I also point to another reason that the U.S. banking system has performed so well over the current economic cycle. This factor is the truly impressive improvement in methods of risk measurement and management and the growing adoption of these technologies by mostly large banks and other large financial intermediaries over the past five years. To be sure, at most banks the application of these methods is still in its infancy, if it has begun at all, and even the most advanced banks have room for improvement. But modern advances in the quantification of risk and in its management have provided bank management with a far more disciplined and structured process for evaluating loans, pricing risks, and deciding which risks to retain."

This is a subject that FRB Chairman Alan Greenspan has also addressed at length. See, for example, speech of October 7, 2002, and story titled "Greenspan Addresses Importance of Computing, Databases and Data Mining to Banking System" in TLJ Daily E-Mail Alert No. 525, October 8, 2002.

Ferguson also made the point the new technologies have played a role in "breaking down traditional distinctions between commercial banking, investment banking, and insurance products". He added that "the Gramm-Leach-Bliley Act can be thought of as a response to technological change".

He then focused on the use of information technology by consumers of financial services. Although, he conceded that here, "the process remains a considerable mystery".

He noted that "many academics, regulators, and bankers have for many years forecast that technological change would end use of the paper check and make the brick-and-mortar bank branch obsolete. However, here we are in October 2003 and the paper check is still very much in use, the smart card has not succeeded as predicted, and the number of brick-and-mortar bank offices is still increasing."

He offered some analysis. He reviewed data collected by the FRB in its triannual Survey of Consumer Finances. In 1998, 6 percent of households had used a computer to conduct business with their financial institutions, while 80 percent had used an in person visit to an office. In 2001, almost 20 percent responded that they had used a computer, while 78 percent had visited an office.

Ferguson said that "While one cannot draw any strong conclusions from this small number of facts, they support the view that, in matters of finance, households tend to adopt technological change only gradually. In addition, even when new technologies start to gain more widespread acceptance, old technologies are abandoned rather slowly and many users perhaps view the old and new technologies more as complements than as substitutes."

He concluded that "Research conducted by the Federal Reserve Board's staff reinforces the notion that the adoption of technological change is a highly complex process. For example, it appears that income, education, age, and other factors, perhaps even a household's attitudes toward risk, play important roles in determining a household's willingness to adopt new technologies for the consumption of financial services. On balance, I would suggest that strategic planners at financial institutions will need to take a wide variety of factors into account in planning and marketing technological innovations."

President Bush has renominated Ferguson to be Vice Chairman of the FRB. The Senate Banking Committee will hold a hearing on his renomination on October 14, 2003.

DOC's Ben Wu Advocates Appropriate Regulatory Framework for Nanotechnology

10/2. Ben Wu, Deputy Under Secretary of Commerce for Technology, gave a speech on nanotechnology. He said that "uninformed public fear" of nanotechnology could lead to regulation the denies the economic and societal benefits that may flow from nanotechnology.

Ben WuWu (at right) stated that "the next big thing is actually very, very small -- it's nanotechnology."

He said that the Bush administration "is committed to having our nation be at the forefront of nanotechnology. The President believes strongly in the economic gains and social advances that nanotechnology can bring to the citizens of the United States and to the rest of the world. This is why the Federal investment in nanotechnology has grown from $116 million in 1997 to more than $700 million in 2003 and President Bush has proposed funding of $849 million for nanotechnology for Fiscal Year 2004."

He also cautioned that "its revolutionary nature will challenge our regulatory systems which may also have to cope with uninformed public fear of potential negative consequences of nanotechnology."

See, for example, article in the April 2000 issue of Wired Magazine titled "Why the future doesn't need us", by Bill Joy.

Wu continued that "If we fail to create appropriate regulatory regimes with the flexibility to adapt to rapidly advancing technologies -- such as nanotechnology -- we will deny ourselves extraordinary economic and societal benefits. And other nations will be sure to step into the vacuum. Comparative advantage will accrue to countries that find the right approach to regulatory oversight -- balancing legitimate societal interests."

He concluded that "If U.S. industry performs well, by successfully seizing the opportunities spawned by public and private nanotechnology research, then our economy and our citizens will prosper. We need to do so in a regulatory environment that is fair, open, and transparent -- a framework that allows good science to overcome overly bureaucratic and burdensome restrictions."

More News

10/8. The Federal Communications Commission (FCC) issued an Order and Authorization [52 pages in PDF] that authorizes, subject to certain conditions, the transfer of licenses incident to Singapore Technologies Telemedia's (ST Telemedia) acquisition of the assets of the bankrupt Global Crossing (GC). GC owns and operates a global fiber optic network. In January of 2002, GC and subsidiaries filed Chapter 11 bankruptcy petitions in U.S. bankruptcy court. Global Crossing will transfer assets to GC Acquisition Limited (New GX). ST Telemedia will obtain common and preferred stock equal to a controlling interest of 61.5 percent of New GX's equity. The FCC's review involved competition analysis, foreign investment analysis, and national security analysis. This is IB Docket No. 02-286. See also, FCC release [2 pages in PDF].

10/8. The Federal Communications Commission (FCC) announced that since October 1, it has received 2,379 complaints about alleged violations of the do-not-call rules and 5,879 inquiries about the rules. See, FCC release.

10/8. Rep. Billy Tauzin (R-LA) and Rep. John Dingell (D-MI), the Chairman and ranking Democrat on the House Commerce Committee, issue a joint statement in which they praised the opinion of the U.S. Court of Appeals (10thCir) staying the U.S. District Court (DColo) opinion barring the Federal Trade Commission (FTC) from enforcing the national do-not-call registry. They also announced that "To lend our full and complete support of the FTC's do-not-call registry, we plan to file an amicus brief with the 10th Circuit that will be drafted by First Amendment expert and former Solicitor General Walter Dellinger." Dellinger, who is now a law professor at Duke University, was the Assistant Attorney General in charge of the Department of Justice's Office of Legal Counsel, and then Solicitor General, during the Clinton administration.

10/8. The Copyright Office (CO) published a notice in the Federal Register stating that the CO "is requesting public comment on the adoption of regulations for records of use of sound recordings performed pursuant to the statutory license for public performances of sound recordings by means of digital audio transmissions between October 28, 1998, and the effective date of soon-to-be-announced interim regulations." Comments are due by November 24, 2003. Reply comments are due by December 22, 2003. See, Federal Register: October 8, 2003, Vol. 68, No. 195, at Page 58054.

10/1. Directv, Inc. and EchoStar Satellite Corporation filed a complaint in state court in Raleigh, North Carolina against the State of North Carolina's Department of Revenue alleging that the state's 5% sales tax on direct broadcast satellite services violates the Commerce Clause of the U.S. Constitution. The plaintiffs assert that the tax is discriminatory because the state does not also tax cable services. See, Directv release. The plaintiffs have also recently brought similar suits against other states.

9/29. Carly Fiorina, CEO of Hewlett Packard, gave a lofty speech in Detroit, Michigan in which she addressed the history of, and economic prospects for, "the Arab world" and "the Islamic world", and how information technology can create opportunities. She said that "for all that technology means in countries like the U.S., its potential is even greater for regions like the Middle East. As we've seen, our newest technology applied to solutions like telemedicine, teleagriculture, and distance learning has a unique ability to help countries leapfrog years of development, to close the gap between technology-empowered communities and technology-excluded communities." She concluded that "We really do believe that if we focus on the possibilities and not just the problems; if we focus on the economics, and not just the politics of the Arab world -- within a generation, we really will see education for everyone, with schools that are totally networked, and students and parents who interact over the Internet."

The TLJ Daily E-Mail Alert will not be published on Friday, October 10, or on Monday, October 13.
Thursday, October 9

The House is in adjournment until 10:00 AM on Friday, October 10.

The Senate is in adjournment until Tuesday, October 14, at 9:30 AM.

8:00 AM - 5:00 PM. The Business Software Alliance will host an event titled "Global Tech Summit". The agenda includes panels titled "The Next Wave of Innovation", "Transforming Today's Challenges into Tomorrow’s Realities", and "The Great Digital Transformation". Secretary of Homeland Security Tom Ridge will give the luncheon address. Location: Atlantic Studios, 650 Massachusetts Ave, NW.

CANCELLED. 8:30 - 10:00 AM. The Progress and Freedom Foundation (PFF) will host an event titled "Future of the Internet". The speakers will include Meg Whitman (CEO of eBay) and Phil Bond (Undersecretary of Commerce for Technology). See, notice. To attend, contact Rebecca Fuller at 202 289-8928 or Location: East Room, Washington Mayflower Hotel, 1127 Connecticut Ave., NW.

8:30 AM - 12:00 NOON. The Global Justice Information-Sharing Initiative Federal Advisory Committee will meet to discuss the Global Justice Information-Sharing Initiative. See, notice in the Federal Register, August 21, 2003, Vol. 68, No. 162, at Pages 50556 - 50557. Location: Sheraton Crystal City Hotel, 1800 Jefferson Davis Highway, Arlington, VA.

12:00 NOON - 2:00 PM. The Intellectual Property Section of the D.C. Bar Association will host a luncheon program titled "Intellectual Property Licensing in the High Technology Area". The speakers will be Jon Grossman (Dickstein Shapiro) and Bradley Wright (Banner & Witcoff). The prices to attend vary. Location: D.C. Bar Conference Center, 1250 H Street, NW, B-1 level.

6:00 - 9:00 PM. The Federal Communications Bar Association (FCBA) will host its 2nd Annual Oktoberfest Reception honoring the Federal Communications Commission's (FCC) bureau chiefs. Location: J.W. Marriott Hotel, 1331 Pennsylvania Avenue, NW.

Deadline to submit reply comments to the Federal Communications Commission (FCC) in response to its notice of proposed rulemaking (NPRM) regarding telecommunication relay services (TRS) and speech-to-speech services for individuals with hearing and speech disabilities. This is CG Docket No. 03-123. See, notice in the Federal Register, August 25, 2003, Vol. 68, No. 164, at Pages 50993 - 50998.

Friday, October 10

The House will meet at 10:00 AM, but no votes are expected. Conference reports may be brought up. See, Republican Whip Notice.

9:15 AM - 5:30 PM. Howard University School of Law (HUSL) will host a one day conference on intellectual property law. At 12:30 PM Judge Paul Michel of the U.S. Court of Appeals (FedCir) will deliver the luncheon address. At 4:30 PM there will be a panel titled "Practicing in the Public Interest: Reshaping IP Policy in a Digital World"; the speakers will be Robert Kasunic (Copyright Office) and Michael Shapiro (U.S. Patent and Trademark Office). See, agenda [PDF]. The price to attend ranges from $150 to $250. Location. HUSL, 2929 Van Ness Street, NW.

10:00 AM. The U.S. Court of Appeals (FedCir) will hear oral argument in Gemstar-TV Guide v. ITC, No. 03-1052. Location: Courtroom 203, 717 Madison Place, NW.

Monday, October 13

Columbus Day. The FCC will be closed. The Senate will not meet.

Tuesday, October 14

The Supreme Court will hear oral argument in Verizon v. Law Offices of Curtis Trinko, No. 02-682. This is a case involving the application of Section 2 of the Sherman Antitrust Act, 15 U.S.C. § 2, in the context of telecommunications. See, TLJ story titled "Supreme Court Grants Certiorari in Verizon v. Trinko", March 10, 2003.

9:30 AM. The U.S. Court of Appeals (DCCir) will hear oral argument in Mobilfone Service, Inc. v. FCC, No. 02-1197. Judges Henderson, Tatel and Roberts will preside. Location: 333 Constitution Ave. NW.

10:00 AM. The Senate Banking Committee will consider several nominations including Harvey Rosen and Kristin Forbes to be members of the Council of Economic Advisers, Julie Myers and Peter Lichtenbaum to be Assistant Secretaries of Commerce for Export Enforcement. The Committee will then hold a hearing on the renominations of Roger Ferguson to be Vice Chairman of the Board of Governors of the Federal Reserve System, and Ben Bernanke to be a member of the Board of Governors. See, notice. Location: Room 538, Dirksen Building.

12:00 NOON - 2:00 PM. The Forum on Technology & Innovation will host a briefing titled "International Challenges to Controlling Spam". For more information, contact Bill Bates at 202 969-3395.

2:00 - 4:00 PM. The Department of Homeland Security's (DHS) National Infrastructure Advisory Council (NIAC) will meet telephonically. The agenda provides that the NIAC will receive the findings and propose recommendations developed by its working groups on Cross Sector Interdependencies and Risk Assessment Guidance and Regulatory Guidance, and receive status briefings on the continuing activities of its working groups on Vulnerability Disclosure Guidelines and the Evaluation and Enhancement of Information Sharing and Analysis. The NIAC is also accepting written comments. To listen only, call 1-877-888-4034. See, notice in the Federal Register, October 7, 2003, Vol. 68, No. 194, at Page 57914.

4:00 PM. Clarisa Long (University of Virginia School of Law) will present a draft paper titled "The Patent/Copyright Interface". See, notice. For more information, contact Robert Brauneis at 202 994-6138 or Location: George Washington University Law School, Faculty Conference Center, Burns Building, 5th Floor, 716 20th Street, NW.

Deadline to submit comments to the LOCAL Television Loan Guarantee Board's regarding the information and recordkeeping requirements of the proposed regulation to implement the LOCAL Television Loan Guarantee Program, as authorized by the Launching Our Communities' Access to Local (LOCAL) Television Act of 2000. The purpose of the Act is to facilitate access to signals of local TV stations in nonserved areas and underserved areas. The Act establishes a LOCAL Television Loan Guarantee Board to approve guarantees of up to 80% of loans totaling no more than $1.25 Billion. The regulation proposes to establish eligibility and guarantee requirements, the application and approval process, the administration of guarantees, and the process through which the Board will consider applications under the priority considerations required in the Act. See, notice in the Federal Register, August 15, 2003, Vol. 68, No. 158, at Pages 48814 - 48833. See also, Treasury release.

Wednesday, October 15

12:15 PM. The Federal Communications Bar Association's (FCBA) Transactional Practice Committee will host a brown bag lunch titled "Anatomy of a Commercial Agreement and Contract Provisions Regarding Performance Requirements". For more information, contact Laurie Sherman at or 703 216-3150. RSVP to Ava Smith at or 202-371-7201. Location: Skadden Arps, 1440 New York Avenue, 11th floor.

Deadline to submit comments to the National Institute of Standards and Technology's (NIST) Computer Security Division (CSD) regarding its draft [137 pages in PDF] of NIST Special Publication 800-61, titled "Computer Security Incident Handling Guide". See also, story titled "NIST Publishes Draft of Computer Security Incident Handling Guide" in TLJ Daily E-Mail Alert No. 741, September 17, 2003.

Thursday, October 16

9:30 AM. The Federal Communications Commission (FCC) will hold a meeting. The event will be webcast. Location: FCC, 445 12th Street, SW, Room TW-C05 (Commission Meeting Room).

10:00 AM. The House Ways and Means Committee will hold a hearing titled "United States - China Economic Relations and China's Role in the Global Economy". See, notice. Location: Room 1100, Longworth Building.

Friday, October 17

9:30 AM. The U.S. Court of Appeals (DCCir) will hear oral argument in Sioux Valley Rural Television v. FCC, No. 02-1208. Judges Henderson, Tatel and Roberts will preside. Location: Courtroom 20, 333 Constitution Ave. NW.

10:00 AM. The House Ways and Means Committee will continue its hearing titled "United States -- China Economic Relations and China's Role in the Global Economy". See, notice. Location: Room 1100, Longworth Building.

2:30 - 4:30 PM. Federal Communications Commission (FCC) International Bureau (IB) will hold a public forum to examine the methods and practices the FCC used in preparation for 2003 World Radioconference (WRC-03), and to assess whether the process can be improved. The FCC seeks public views on how the FCC could further facilitate public participation, increase transparency, intensify its international outreach and generally promote public interest goals in the WRC preparatory process. See, notice [PDF]. Location: FCC, Commission Meeting Room (Room TW-C305), 445 12th Street, SW.

Deadline to submit requests to the Trade Policy Staff Committee (TPSC) to testify at its November 5, 2003 hearing on negotiations with Bahrain on a free trade agreement (FTA). The TPSC seeks comments and testimony to assist the Office of the U.S. Trade Representative (USTR) on many topics, including "Relevant trade-related intellectual property rights issues that should be addressed in the negotiations" and "Existing barriers to trade in services between the United States and Bahrain that should be addressed in the negotiations". See, notice in the Federal Register, August 25, 2003, Vol. 68, No. 164, at Pages 51062 - 51064.

Deadline for the Federal Trade Commission (FTC) to submit its brief to the U.S. Court of Appeals (10thCir) in FTC v. Mainstream Marketing Service, No. 03-1429. This is the telemarketers' constitutional challenge to the FTC's do not call registry. See, October 8, 2003 order [24 pages in PDF] staying the District Court's opinion, and setting an expedited schedule.

NBC and Vivendi Announce Merger Plans

10/8. General Electric and Vivendi Universal announced that they have signed a definitive agreement for the merger of NBC (which is a division of GE) and Vivendi Universal Entertainment (VUE). The new company will be 80%-owned by GE, with 20% held by the shareholders of VUE. See, GE release.

The proposed merger is subject to regulatory approvals. Sen. Mike DeWine (R-OH) and Sen. Herb Kohl (D-WI), the Chairman and ranking Democrat on the Senate Judiciary Committee's Subcommittee on Antitrust, Competition Policy and Consumer Rights issued a joint statement. They wrote that "The combination of NBC and Vivendi Universal's media holdings is the latest example of the increasing consolidation in our media industry, a trend which should concern all of us who care about the diversity of viewpoints available to all Americans. We need to scrutinize this deal closely to examine its implications for competition in media marketplace, and expect to be holding a hearing shortly."

6th Circuit Rules in Gordon v. Nextel

10/6. The U.S. Court of Appeals (6thCir) issued its opinion in Gordon v. Nextel, a copyright infringement case involving the de minimis and fair use defenses.

Stephen Gordon is a medical artist. He has drawn, and copyrighted, dental illustrations. Nextel is a communications company. Nextel and its advertising agency, Mullen Advertising, produced and published a television commercial in which Gordon's illustrations appear. They did not obtain authorization from Gordon.

Gordon filed a complaint in U.S. District Court (EDMich) against Nextel and Mullen alleging copyright infringement, and removal of copyright notice. The District Court ruled that the use constituted fair use and was de minimis, and that there was therefore no infringement. It also ruled that Gordon had failed to introduce evidence of intentional removal of copyright notice.

The Appeals Court affirmed. It first held that the use of the illustrations was de minimis. Hence, there was no copyright infringement. The Court did not proceed to examine the fair use defense. The Appeals Court affirmed the District Court on the copyright notice removal claim. He failed to introduce evidence of intent, as required by 17 U.S.C. § 1202(b).

This case is Gordon v. Nextel Communications and Mullen Advertising, Inc., No. No. 01-2274, an appeal from the U.S. District Court for the Eastern District of Michigan, at Detroit, Judge John O'Meara presiding, D.C. No. 00-73201.

More Court Opinions

10/8. The U.S. Court of Appeals (4thCir) issued its opinion [PDF] in Bouchat v. Baltimore Ravens, a copyright case involving the artwork used by the Baltimore Ravens football team. The District Court, following a jury trial, found that Bouchat's copyright had been infringed, but awarded him no portion of the Ravens' profits as damages. He asserted that the District Court erroneously failed to accord him the benefit of a statutory presumption that an infringer's revenues are entirely attributable to the infringement. The Appeals Court affirmed. This case is Frederick Bouchat v. Baltimore Ravens Football Club, Inc., et al., No. 02-1999, an appeal from the U.S. District Court for the District of Maryland, at Baltimore, Judge Marvin Garbis presiding, D.C. No. CA-97-1470-MJG.

10/6. The U.S. Court of Appeals (9thCir) issued its opinion [PDF] in Lamps Plus v. Seattle Lighting Fixture, a copyright case involving table lamps. This case is Lamps Plus, Inc. v. Seattle Lighting Fixture Co., et al., Nos. 01-35352, 01-35399 and 01-35484, appeals from the U.S. District Court for the Western District of Washington.

10/8. The U.S. Court of Appeals (6thCir) issued its opinion in Miller v. Champion Enterprises, a class action securities fraud case involving the Private Securities Litigation Reform Act (PSLRA). The District Court dismissed the complaint for failure to meet the heightened pleading requirements for scienter under the PSLRA. The Appeals Court affirmed. This case is Joel Miller, et al. v. Champion Enterprises, Inc., No. 01-1955, an appeal from the U.S. District Court for the Eastern District of Michigan, at Detroit, Judge John Feikens presiding, D.C. No. 99-74231.

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