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December 3, 2003, 9:00 AM ET, Alert No. 791.
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FBI Employee Pleads Guilty to Computer Crime

12/2. Narissa Smalls entered a plea of guilty in U.S. District Court (DC) to accessing a computer system without authorization. What is notable about this case is that at the relevant time Smalls was an employee of the Department of Justice's (DOJ) Federal Bureau of Investigation (FBI), the computer system that she accessed was the FBI's Automated Case Support (ACS) computer system, the information that she obtained pertained to ongoing drug investigations, and that, in the words of the DOJ, "she then shared the results of her ACS searches with individuals who were associated with the subjects of the FBI's drug investigations".

Small was a legal technician in the FBI headquarters in Washington DC. The DOJ stated that she resigned as part of a plea agreement. She has not yet been sentenced. See, DOJ release.

This is not the first incident involving lack of computer security at the FBI. For example, on August 5, 2002, the DOJ's Office of the Inspector General (OIG) released a series of reports on the control of laptop computers and weapons at five DOJ components. It found a total of 400 missing laptops, and 775 missing weapons. For the FBI, it reported 317 missing laptops and 212 missing weapons. Moreover, the OIG found that the FBI does not know if sensitive data was lost. See, story titled "FBI Loses 317 Laptops" in TLJ Daily E-Mail Alert No. 485, August 6, 2002.

Similarly, on December 19, 2002, the DOJ's OIG released a report titled "Federal Bureau of Investigation's Management of Information Technology Investments". The report concludes that the "FBI has not effectively managed its IT investments because it has not fully implemented the management processes associated with successful IT investments." The report adds that "the FBI continues to spend hundreds of millions of dollars on IT projects without adequate assurance that these projects will meet their intended goals." See, story titled "DOJ OIG Report Criticizes FBI Management of IT Resources" in TLJ Daily E-Mail Alert No. 572, December 20, 2002.

Markle Foundation Releases Report on Homeland Security and Information Technology

12/2. The Markle Foundation's Task Force on National Security in the Information Age released a report titled "Creating a Trusted Information Network for Homeland Security".

See, release [HTML], Overview [2 pages in PDF], Part I - Task Force Report [42 pages in PDF], Part II - Working Group Analysis [PDF], and Part III - Appendices [PDF].

This report states that "the government should create networks for information collection, sharing, analysis, and use across federal, state, and local agencies and the private sector, while preserving -- and even enhancing -- privacy and other civil liberties. The network we envision consists not just of the technological architecture, but also of the people, processes, and information that must go hand-in-hand with the technology, and the rules that should govern how all of these elements interact."

It recommends that the President "issue guidelines for government collection and use of information." It also recommends that executive branch and Congress "implement the measures necessary to create the proposed Systemwide Homeland Analysis and Response Exchange Network (SHARE)".

The report states that "The handling of information should be decentralized, and should take place directly among users, according to a network model rather than a mainframe or hub-and-spoke model." Also, "The network should be guided by policy principles that simultaneously empower and constrain government officials by making it clear what is permissible and what is prohibited." Moreover, "Our government’s strategy should focus on prevention."

The report states that "The distinguishing line between domestic and foreign threats is increasingly difficult to sustain. Thus, in its approach, our government should avoid creating blind spots, or gaps between agencies, that arise from this distinction. At the same time, though, our government needs urgently to define new rules -- rules to replace the old "line at the border" between domestic and foreign authorities for information-collection and use -- to ensure that agencies do not infringe on our traditional civil liberties."

It further states that "The network should reflect the fact that many key participants are not in the federal government, but rather in state or local government and the private sector." In addition, "The network should make it possible for the government to effectively utilize not only information gathered through clandestine intelligence activities and law enforcement investigations, but also appropriate information held by private companies. This should happen only after clear articulation by the government of the need for this information and the issuance of guidelines for its collection and use."

Finally, the report states that "Combating terrorism is a long-term effort that is designed to protect our way of life and our values along with our security. Therefore, the policies and actions undertaken need to have the support -- and trust -- of the American people. Privacy and other civil liberties must be protected."

The Executive Director of the Markle Foundation's Task Force on National Security in the Information Age is Michael Vatis. The Task Force is chaired by Zoe Baird and James Barksdale.

The Task Force members include representatives from technology companies (including Microsoft, Sun Microsystems, 3Com, and Mitretek), numerous academics, representatives of Markle and other groups and think tanks (including the Center for Democracy and Technology, Progressive Policy Institute, Brookings Institute, and Center for Strategic and International Studies), numerous lawyers, lobbyists, and former legislators (including Slade Gordon and Rick White), and representatives of government (including Utah Governor Michael Levitt and In-Q-Tel's President). See, list of members [PDF].

Reps. Tauzin & Greenwood Request GAO Report on E-Rate Waste, Fraud & Abuse As Prelude to Oversight Hearing

12/2. Rep. Billy Tauzin (R-LA), the Chairman of the House Commerce Committee, and Rep. James Greenwood (R-PA), the Chairman of the Subcommittee on Oversight and Investigations, wrote a letter to David Walker, the head of the General Accounting Office (GAO), asking that the GAO "review the E-rate program's structure and operations to determine whether federal funds are being used in accordance with program rules, whether the funds are being used effectively to achieve program goals, and whether the program needs fundamental changes to ensure program goals are met.

Rep. James GreenwoodRep. Tauzin and Rep. Greenwood (at right) wrote that although the Federal Communications Commission's (FCC) Universal Service Administration Company (USAC) has taken corrective actions previously recommended by the GAO, "such as strengthening its application review process, allegations of waste, fraud, and abuse continue to be raised since GAO last reviewed the program."

They added that "Questions have also been raised about the basic effectiveness of the program's structure in meeting the goal of connecting schools and libraries to the Internet."

They also stated the the Committee anticipates holding a hearing in "early 2004".

Sen. Hatch Introduces Bill With Numerous Amendments to Copyright Act

11/21. Sen. Orrin Hatch (R-UT), Sen. Dianne Feinstein (D-CA) and Sen. John Cornyn (R-TX) introduced S 1933, the "Enhancing Federal Obscenity Reporting and Copyright Enforcement Act of 2003", also named the "EnFORCE Act". The title of the bill is memorable, but not descriptive. This bill contains six mostly unrelated amendments to the Copyright Act.

First, the bill would amend 17 U.S.C. § 411, regarding the registration of copyrights with the Copyright Office. The bill would add a new subsection that provides that "A certificate of registration shall satisfy the requirements of this section and section 412 irrespective of any inaccurate information therein, unless -- (A) the inaccurate information was included on the application for copyright registration with knowledge that it was inaccurate; and (B) the inaccurate information, if known, would have caused the Register of Copyrights to refuse registration."

Sen. Orrin HatchSen. Hatch (at right) explained that "Some accused infringers have tried to avoid liability for statutory damages by challenging the accuracy of the information in copyright registrations; this bill clarifies that courts should resolve such challenges by applying the existing judicial doctrine of fraud-on-the-Copyright-Office." See, Hatch release.

Second, the bill would amend 17 U.S.C. § 504 regarding remedies for copyright infringement. Subsection 504(c)(1) pertains to actual damages and profits. It provides that "For the purposes of this subsection, all the parts of a compilation or derivative work constitute one work."

S 1933 would amend subsection 504(c)(1) to provide the exception that "the court in its discretion may determine that such parts are separate works if the court concludes that they are distinct works having independent economic value".

Sen. Hatch explained that "disputes have arisen about how many ``works´´ have been infringed for purposes of computing statutory damages. These disputes are important for the music industry, which has received inconsistent adjudications about whether an album consisting of ten songs counts as one or ten works for statutory-damages computation. The bill gives courts discretion to conform the law of statutory damages to changing market realities."

Third, the bill would amend 17 U.S.C. § 115, which pertains to, among other things, compulsory licensing in the music industry. Subsection 115(c)(3)(B) pertains to the application of antitrust law to negotiations regarding royalties payable under compulsory license. The would provide that "Section 115(c)(3)(B) of title 17, United States Code, is amended in the first sentence by striking `under this paragraph´ and inserting `under this section´."

Sen. Hatch commented that this provision "will expand an existing antitrust exemption to conform the law to market realities. Today, an antitrust exemption in the Copyright Act gives record companies and music publishers the flexibility they need to negotiate mechanical royalty rates in the rapidly evolving market for legal music downloading. These parties now need the same flexibility to ensure that they can negotiate royalties associated with innovative forms of physical phonorecords, like enhanced compact disks and DVD audio disks."

He added that "the music industry has sometimes been criticized for being too slow to adapt its business models to new technologies. The industry is now responding to such concerns by developing new products and new distribution channels. The EnFORCE Act will ensure that federal law allows the music industry to provide consumers with these innovative products and services."

Fourth, the bill would require that "The Attorney General shall ensure that any unit in the Department of Justice responsible for investigating computer hacking or responsible for investigating intellectual property crimes is assigned at least 1 agent to support such unit for the purpose of investigating crimes relating to the theft of intellectual property and that each such agent has received training in the investigation and enforcement of intellectual property crimes."

Fifth, the bill would authorize the appropriation to the Department of Justice (DOJ) of $5,000,000 for each of fiscal years 2005 through 2009 to provide for these agents responsible for intellectual property crimes.

Sixth, the bill would require that the DOJ shall include in its reports to the Congress information about "the number of misdemeanor prosecutions and the number of felony prosecutions under sections 2252, 2252A, 2252B, 2260, 2318, 2319, 2319A, and 2320 of title 18, United States Code, commenced and concluded during the last preceding fiscal year, including, in the case of those offenses where applicable, detailed information concerning -- (1) the types of works involved; (2) the tangible media of expression and means of reproduction and distribution involved; and (3) in the case of prosecutions concluded, the disposition of such prosecutions, such as the number of convictions and acquittals, and the sentences imposed."

Sen. Hatch stated that "The bill also requires the Department of Justice to report to Congress detailed information about the scope of its efforts to investigate and prosecute crimes involving the sexual exploitation of minors or intellectual property."

Sections 2252, 2252A, 2252B, and 2260 pertain to crimes involving pornography, obscenity, and exploitation of minors. Sections 2318, 2319, 2319A, and 2320 pertain to intellectual property crimes.

Section 2318 pertains to counterfeit labeling, documentation and packaging of computer programs, phonorecords, and movies. Moreover, there are proposals to revise and strengthen this section. For example, on November 21, 2003, Rep. Lamar Smith (R-TX) introduced HR 3632, the "Anti-counterfeiting Amendments of 2003". See, story titled "Rep. Smith Introduces Bill to Strengthen Ban on Counterfeit Labeling of Software, Movies and Music" in TLJ Daily E-Mail Alert No. 787, November 26, 2003.

Section 2319 pertains to criminal infringement of copyrights. Section 2319A pertains to the unauthorized fixation of and trafficking in sound recordings and music videos of live musical performances. Section 2320 pertains to trafficking in counterfeit goods or services.

More News

12/2. The House Commerce Committee's Subcommittee on Oversight announced that it will hold a hearing titled "Identity Theft: Assessing the Problem and Efforts to Combat It". See, notice. The hearing will be held in Langhorne, Pennsylvania, and will not be webcast. Langhorne is located in the Congressional District of Rep. James Greenwood (R-PA), the Chairman of the Subcommittee.

11/24. Armando Villa was sentenced by the U.S. District Court (SDFl) to served thirty months imprisonment for criminal copyright infringement. The Department of Justice (DOJ) stated in a release that Villa sent spam e-mail messages, and placed classified advertisements on the internet, advertising the sale of software programs; however, he sold software that he had unlawfully reproduced for purposes of commercial advantage and private financial gain.

Washington Tech Calendar
New items are highlighted in red.
Wednesday, December 3

The House is in adjournment until December 8.

The Senate is in adjournment until December 9.

9:30 AM - 12:00 NOON. The American Enterprise Institute (AEI) will host a panel discussion titled "Should Regulators Set Rates to Terminate Calls on Mobile Networks?" The speakers will be Robert Crandall (Brookings), Greg Sidak (AEI) and Richard Feasey (Vodafone). See, notice. Location: AEI, 12th Floor, 1150 17th Street, NW.

1:00 PM. Day one of a three day conference hosted by the National Science Foundation (NSF) titled "Societal Implications of Nanoscience and Nanotechnology". Technology Administration (TA) Under Secretary Phil Bond and Director of White House Office of Science and Technology Policy John Marburger will make opening remarks at 1:00 PM. For more information, contact Cate Alexander at 703 292-4399 or See, notice. Location: NSF, 4201 Wilson Boulevard, Arlington, VA.

Day two of a two day conference titled "E-Gov Homeland Security Conference". AT 8:15 AM David Walker (Comptroller General of the U.S., GAO) will give the breakfast keynote address. At 2:15 PM there will be a panel discussion titled "Priorities for Critical Infrastructure Protection -- What are the Economic Risks?" The panelists include Michael Dawson (Deputy Assistant Secretary for Critical Infrastructure Protection and Compliance Policy at the Department of the Treasury) and Drew Arena (Verizon). Also at 2:15 PM, there will be a panel titled "Open Technology Issues for HLS Professionals". See, conference web site. Location: Ronald Reagan Building.

Thursday, December 4

Day one of a two day event titled "21st Annual Institute on Telecommunications Policy & Regulation". See, notice. The price to attend is $1,295.00. Location: International Trade Center, Washington DC.

Day two of a three day conference hosted by the National Science Foundation (NSF) titled "Societal Implications of Nanoscience and Nanotechnology". For more information, contact Cate Alexander at 703 292-4399 or See, notice. Location: NSF, 4201 Wilson Boulevard, Arlington, VA.

9:00 AM - 12:30 PM. The Internal Revenue Service's (IRS) Electronic Tax Administration Advisory Committee (ETAAC) will meet. See, notice in the Federal Register, November 7, 2003, Vol. 68, No. 216, at Pages 63192 - 63193. Location: Ritz-Carlton Hotel, Pentagon City, Diplomat Meeting Room, 1250 South Hayes Street, Arlington, VA.

9:30 AM. The U.S. Court of Appeals (DCCir) will hear oral argument in Vernal Ent Inc v. FCC, No. 02-1297. Judges Sentelle, Tatel and Roberts will preside. Location: 333 Constitution Ave. NW.

The Federal Communications Bar Association (FCBA) will host its annual Chairman's Dinner. Location: The Washington Hilton Hotel.

Deadline to register to attend the December 9-10 meeting of the National Institute of Standards and Technology's (NIST) Visiting Committee on Advanced Technology. Contact Carolyn Peters at 301 975-5607 See, notice in the Federal Register,  November 25, 2003, Vol. 68, No. 227, at Pages 66074 - 66075.

Friday, December 5

Day two of a two day event titled "21st Annual Institute on Telecommunications Policy & Regulation". See, notice. The price to attend is $1,295.00. Location: International Trade Center, Washington DC.

Day three of a three day conference hosted by the National Science Foundation (NSF) titled "Societal Implications of Nanoscience and Nanotechnology". For more information, contact Cate Alexander at 703 292-4399 or See, notice. Location: NSF, 4201 Wilson Boulevard, Arlington, VA.

9:30 AM. The U.S. Court of Appeals (DCCir) will hear oral argument in KERM Inc v. FCC, No. 03-1028. Judges Sentelle, Tatel and Roberts will preside. Location: 333 Constitution Ave. NW.

10:00 AM - 1:00 PM. The Federal Communications Commission's (FCC) Network Reliability and Interoperability Council (NRIC) will hold a meeting. See, FCC notice. Location: FCC, Commission Meeting Room, 445 12th Street, SW.

12:00 NOON - 2:00 PM. The Progress and Freedom Foundation (PFF) will host a panel discussion titled "Taxes and Regulation: The Effects of Mandates on Wireless Consumers". The speakers will include Anne Boyle (Commissioner of the Nebraska Public Service Commission), Thomas Lenard (PFF), John Muleta (Chief of the FCC's Wireless Telecommunications Bureau), and Paul Rubin (Emory University). Lunch will be served. To register, contact Andrea Knutsen at 202 289-8928 or See, notice. Location: Room 1539, Longworth Building.

Deadline to submit initial comments to the Federal Communications Commission (FCC) in response to its Report and Order and Further Notice of Proposed Rulemaking [198 pages in PDF] in it proceeding titled "In the Matter of Promoting Efficient Use of Spectrum Through Elimination of Barriers to the Development of Secondary Markets". The FCC adopted this item on May 15, 2003, but did not release it until October 7, 2003. This is FCC 03-113 in WT Docket No. 00-230. See, TLJ story titled "FCC Adopts Order Allowing Some Secondary Leasing of Spectrum", May 15, 2003, and story titled "FCC Finally Releases R&O and FNPRM in Secondary Spectrum Markets Proceeding" in TLJ Daily E-Mail Alert No. 755, October 8, 2003.

Monday, December 8

The House will return from a recess at 9:30 AM.

8:45 AM - 5:30 PM. There will be a day long conference titled "Patent and Trademark Office Day". See, agenda [PDF]. Location: the Ronald Reagan Building and International Trade Center.

Deadline to submit comments to the Federal Communications Commission (FCC) regarding its notice of proposed rulemaking (NPRM) regarding human exposure to radiofrequency (RF) energy. The FCC adopted this notice of proposed rulemaking on June 12, 2003, and released it on June 26, 2003. This is ET Docket No. 03-137. For more information, contact Robert Cleveland in the FCC's Office of Engineering and Technology at 202 418-2422 or See, notice in the Federal Register, September 8, 2003, Vol. 68, No. 173, at Pages 52879 - 52889.

Deadline to submit comments to the Federal Communications Commission (FCC) in response to its Notice of Proposed Rulemaking (NPRM) regarding implementation of 47 U.S.C. § 272(b)(1). This NPRM is FCC 03-272 in WC Docket No. 03-228. The FCC adopted this NPRM on November 3, 2003, and released it on November 4, 2003. For more information, contact Christi Shewman at 202 418-1686 or See, notice in the Federal Register, November 21, 2003, Vol. 68, No. 225 at Pages 65665 - 65667.

Tuesday, December 9

The Senate will return from recess at 10:00 AM.

Day one of a two day meeting of the Executive Office of the President's (OEP) Office of Science and Technology Policy's (OSTP) National Science and Technology Council's (NSTC) Committee on Science's Subcommittee on Research Business Models regarding the policies, procedures, and plans relating to the business relationship between federal agencies and research performers. See, notice in the Federal Register, September 16, 2003, Vol. 68, No. 179, at Pages 54225 - 54226. Location: Department of Agriculture, 1400 Independence Ave., SW.

8:25 AM - 5:15 PM. The National Institute of Standards and Technology's (NIST) Visiting Committee on Advanced Technology will meet. Some of the meeting will be closed to the public. The agenda includes a NIST update on current NIST programs; strategic plan and program priorities; human resources, safety, and diversity; and program implementation and evaluation. The deadline to register is December 4. Contact Carolyn Peters at 301 975-5607 See, notice in the Federal Register,  November 25, 2003, Vol. 68, No. 227, at Pages 66074 - 66075. Location: NIST, Employees Lounge, Administration Building, Gaithersburg, MD.

8:30 AM - 3:15 PM. The American Enterprise Institute (AEI) will host a conference titled "Competition versus Cooperation in Global Tax Policy" See, notice. Location: AEI, 12th Floor, 1150 17th Street, NW.

9:00 AM - 4:30 PM. The Department of Commerce's (DOC) National Telecommunications and Information Administration (NTIA) will hold the first in a series of public meetings on government management of spectrum. See agenda. See also, notice in the Federal Register, November 24, 2003, Vol. 68, No. 226, at Page 65893. For more information, contact Joe Gattuso at 202 482-1880 or Location: Room 4830, Hoover Building, 1401 Constitution Avenue, NW.

12:00 NOON. The Federal Communications Bar Association's (FCBA) Common Carrier Practice Committee will host a brown rag lunch. The topic will be the MFJ decree, the Section 271 process, and the effectiveness of the 20-year experiment with line of business restrictions, and pending FCC proceedings regarding structural and non-structural safeguards. The speakers will be Bernard Wunder, James Harralson, and Richard Metzger. RSVP to Cecelia Burnett at 202 637-8312 or Location: Hogan & Hartson LLP, 555 13th St., NW. lower level.

FTC Comments on Internet Advertising of Prescription Drug Products

12/1. The Federal Trade Commission (FTC) submitted comments [38 pages in PDF] to the Food and Drug Administration (FDA) in response to its request for comments regarding the advertising of prescription drug products directly to consumers (DTC advertising). These comments address, among other topics, internet advertising.

The FTC comment concluded that "Internet advertising should be treated consistently with DTC ads in other media, and it would be beneficial if the FDA were to issue guidance addressing DTC ads available on the Internet."

The FTC comment noted that "A consistent finding among the surveys is the significant degree to which DTC advertising provides consumers with useful information concerning their health. Ads achieve much of this informative role indirectly, by encouraging consumers to seek out more information from other sources about the advertised drug and the condition it ameliorates. ... In what will no doubt be an increasingly important source, the percentage of consumers seeking information on the Internet as a result of viewing a DTC ad increased from 18% in 1999 to 38% in 2002."

The FTC comment elaborated that "The Internet is a valuable resource for consumers looking for information about prescription drugs. According to a Pew Internet Project survey conducted in March 2002, 73 million American adults (62% of Internet users surveyed) use the Internet to look for health information. About two out of three of these users (64%) searched for information about prescription drugs, and more than half checked the Internet before visiting a doctor. According to the FDA's 2002 DTC advertising survey, as noted above, 38% of those surveyed cited the Internet as a source of information, up from 18% in the previous survey in 1999." (Parentheses in original. Footnotes are omitted from all quotes in this article.)

The FTC comment states that "Internet websites should be treated as DTC advertising, unless the site is also used to sell products or contains other indicia of labeling. We believe that the FDA may be able to provide consumers with additional protection – and manufacturers with greater certainty -- by spelling out basic guidelines for websites in a guidance document. We recommend that these websites include the same brief summary information that all other DTC advertising would include under our recommendations above. If the FDA decides to retain its distinction between the brief summary requirements for DTC print and broadcast ads, then we recommend that the standards for print ads apply to websites: both media allow the communication of more information in text in a manner that broadcast advertisements do not."

The FTC also wrote that "The FDA may wish to consider developing an approach to the Internet that would require or encourage manufacturers to ensure that websites have certain minimum elements. For example, if a company website provides information about the benefits of a drug, the major statement of risks should be on the first web page that discusses its benefits, accompanied by an appropriate link to a source of more complete risk information that may be located elsewhere on the website. Consumers thus would receive the most important risk information about the advertised drug, with easy and ready access to more complete risk information, if they are interested in such information."

Finally, the FTC wrote that "For other Internet advertisements, such as banner ads or pop-up ads, many ads in these formats will be reminder ads or help-seeking ads. These ads need not include a brief summary, consistent with the current treatment of similar ads in other media. Other ads in these formats should be required to disclose the brief summary information to the same extent as ads in other media. Here, however, advertisers should be able to satisfy this requirement by sending consumers who click on the banner ad or pop-up ad to the first web page on the company’s website that discusses the benefits of the drug, that is, the web page that will have the major statement of risks and an appropriate link to more complete risk information. Sending consumers who receive DTC ads online -- who, by definition, have Internet access -- to a web page with a major statement of risks and an appropriate link to more complete risk information should satisfy the brief summary requirement. Similarly, advertisers should be able to meet the brief summary requirement for commercial email by including an appropriate disclosure that additional information is available on a specific page of a website."

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