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January 27, 2004, 9:00 AM ET, Alert No. 824.
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Bush Signs Omnibus Appropriations Bill

1/23. President Bush signed into law HR 2673, known as the omnibus appropriations bill, and the consolidated appropriation act. See, White House release.

On January 22, the Senate passed the conference report on HR 2673 by a vote of 65-28. See, Roll Call No. 3. First, the Senate passed a motion to invoke cloture (to end a Democratic filibuster) by a vote of 61-32. See, Roll Call No. 2. The House passed this conference report on December 8, 2003.

HR 2673, is a consolidation of many long overdue appropriations bills. It includes the CJS bill. This bill includes appropriations for the Department of Commerce (DOC), Department of Justice (DOJ) (which includes the Antitrust Division), Department of State (DOS), the federal judiciary, and numerous independent agencies, including the Federal Communications Commission (FCC), Federal Trade Commission (FTC), and Securities and Exchange Commission (SEC).

The DOC, in turn, includes the National Telecommunications and Information Administration (NTIA), National Institute of Standards and Technology (NIST), Bureau of Industry and Security (BIS/BXA), and the U.S. Patent and Trademark Office (USPTO). Hence, this CJS bill contains most of the technology related provisions found in appropriations bills.

HR 2673 also includes the appropriations for the Department of Veterans Affairs, Department of Housing and Urban Development, Department of Transportation, Department of the Treasury, Department of Labor, Department of Health and Human Services, Department of Education, and the Department of Agriculture. The Agriculture bill is significant because this department includes the Rural Utilities Service (RUS), which is now involved in loans and grants for broadband deployment, distance learning and telemedicine.

President Bush wrote a separate signing statement. He wrote that many of the provision in the bill "are inconsistent with the constitutional authority of the President to conduct foreign affairs, command the Armed Forces, protect sensitive information, supervise the unitary executive branch, make appointments, and make recommendations to the Congress. Many other provisions unconstitutionally condition execution of the laws by the executive branch upon approval by congressional committees." He added that "The executive branch shall construe as advisory" such provisions. He then listed these provisions.

See also, following article, titled "Summary of Technology Related Provisions of the Omnibus Appropriations Bill".

Summary of Technology Related Provisions of the Omnibus Appropriations Bill

1/23. HR 2673, the omnibus appropriations bill, signed by President Bush on January 23, 2004, contains appropriations for many technology related departments, agencies and other units. It also contains several technology related substantive law provisions.

FCC and the National Television Ownership Cap. The bill appropriates to the Federal Communications Commission (FCC) for FY 2004 $273,958,000.

The bill also contains substantive language regarding the national TV ownership cap. It amends the Communications Act to provide a cap of 39 percent. Section 629 provides as follows:

"The Telecommunications Act of 1996 is amended as follows--
  (1) in section 202(c)(1)(B) by striking `35 percent' and inserting `39 percent';
  (2) in section 202(c) by adding the following new paragraphs at the end:
    `(3) DIVESTITURE- A person or entity that exceeds the 39 percent national audience reach limitation for television stations in paragraph (1)(B) through grant, transfer, or assignment of an additional license for a commercial television broadcast station shall have not more than 2 years after exceeding such limitation to come into compliance with such limitation. This divestiture requirement shall not apply to persons or entities that exceed the 39 percent national audience reach limitation through population growth.
    `(4) FORBEARANCE- Section 10 of the Communications Act of 1934 (47 U.S.C. 160) shall not apply to any person or entity that exceeds the 39 percent national audience reach limitation for television stations in paragraph (1)(B);'; and
  (3) in section 202(h) by striking `biennially' and inserting `quadrennially' and by adding the following new flush sentence at the end:
`This subsection does not apply to any rules relating to the 39 percent national audience reach limitation in subsection (c)(1)(B).'."

RUS Broadband, Distance Learning and Telemedicine Loans and Grants. The bill contains appropriations for the Department of Agriculture's Rural Utilities Service (RUS), for among other things, loans for broadband deployment, distance learning and telemedicine loans and grants.

It provides the following: "For the principal amount of direct distance learning and telemedicine loans, $300,000,000; and for the principal amount of direct broadband telecommunication loans, $602,000,000."

It further provides: "For grants for telemedicine and distance learning services in rural areas, as authorized by 7 U.S.C. 950aaa et seq., $39,000,000, to remain available until expended: Provided, That $14,000,000 shall be made available to convert analog to digital operation those noncommercial educational television broadcast stations that serve rural areas and are qualified for Community Service Grants by the Corporation for Public Broadcasting under section 396(k) of the Communications Act of 1934, including associated translators, repeaters, and studio-to-transmitter links."

It also provides: "In addition, $9,000,000, to remain available until expended, for a grant program to finance broadband transmission in rural areas eligible for Distance Learning and Telemedicine Program benefits authorized by 7 U.S.C. 950aaa."

Children's Internet Protection Act (CIPA). The bill contains two sections that implement the Children's Internet Protection Act (CIPA) [20 pages in PDF]. The CIPA requires that schools and libraries receiving federal subsidies for telecommunications, internet access or internal connections adopt an internet safety policy and employ technological protections that block or filter certain visual depictions deemed obscene, pormographic, or harmful to minors.

Section 516 of the bill requires that "None of the funds made available by this Act to carry out the Library Services and Technology Act may be made available to any library covered by paragraph (1) of section 224(f) of such Act (20 U.S.C. 9134(f)), as amended by the Children's Internet Protections Act, unless such library has made the certifications required by paragraph (4) of such section."

Section 517 of the bill requires that "None of the funds made available by this Act to carry out part D of title II of the Elementary and Secondary Education Act of 1965 may be made available to any elementary or secondary school covered by paragraph (1) of section 2441(a) of such Act (20 U.S.C. 6777(a)), as amended by the Children's Internet Protections Act and the No Child Left Behind Act, unless the local educational agency with responsibility for such covered school has made the certifications required by paragraph (2) of such section."

On June 23, 2003, the Supreme Court issued its opinion [56 pages in PDF] in US v. American Library Association, upholding the constitutionality of the CIPA. See, story titled "Supreme Court Upholds Children's Internet Protection Act" in TLJ Daily E-Mail Alert No. 686, June 24, 2003. See also, story titled "NTIA Releases Report to Congress Re Internet Filtering Technology" in TLJ Daily E-Mail Alert No. 721, August 19, 2003.

Prohibition on Federal Agency Monitoring of Certain Internet Use. Section 633(a) provides that "None of the funds made available in this or any other Act may be used by any Federal agency (1) to collect, review, or create any aggregate list, derived from any means, that includes the collection of any personally identifiable information relating to an individual's access to or use of any Federal Government Internet site of the agency; or (2) to enter into any agreement with a third party (including another Government agency) to collect, review, or obtain any aggregate list, derived from any means, that includes the collection of any personally identifiable information relating to an individual's access to or use of any nongovernmental Internet site." (Parentheses in original.)

However, the Section 633(b) includes several exceptions: "(1) any record of aggregate data that does not identify particular persons; (2) any voluntary submission of personally identifiable information; (3) any action taken for law enforcement, regulatory, or supervisory purposes, in accordance with applicable law; or (4) any action described in subsection (a)(1) that is a system security action taken by the operator of an Internet site and is necessarily incident to the rendition of the Internet site services or to the protection of the rights or property of the provider of the Internet site."

Department of Commerce. The bill appropriates $6,411,000 for the Office of Technology Policy. It appropriates $68,203,000 for the Bureau of Industry and Security (BIS), which is still also know as the Bureau of Export Administration (BXA).

The bill appropriates $1,222,460,000 for the U.S. Patent and Trademark Office (USPTO). The bill also continues the practice of diverting USPTO user fees to subsidize other government programs.

The bill also provides that "no employee of the United States Patent and Trademark Office may accept payment or reimbursement from a non-Federal entity for travel, subsistence, or related expenses for the purpose of enabling an employee to attend and participate in a convention, conference, or meeting when the entity offering payment or reimbursement is a person or corporation subject to regulation by the Office, or represents a person or corporation subject to regulation by the Office, unless the person or corporation is an organization exempt from taxation pursuant to section 501(c)(3) of the Internal Revenue Code of 1986."

The bill also contains appropriations for the National Telecommunications and Information Administration (NTIA). It provides $14,604,000 for salaries and expenses. It provides $22,000,000 for public telecommunications facilities, planning and construction. Finally, it provides $15,000,000 for information infrastructure grants.

Other Entities. The bill appropriates $41,994,000 for the Office of the U.S. Trade Representative (USTR). It also provides that "negotiations shall be conducted within the World Trade Organization to recognize the right of members to distribute monies collected from antidumping and countervailing duties."

The bill appropriates $133,133,000 for the Department of Justice's (DOJ) Antitrust Division.

The bill appropriates $811,500,000 for the Securities and Exchange Commission (SEC). This is an increase of $66 Million over FY 2003.

The bill appropriates $186,041,000 for the Federal Trade Commission (FTC). This is an increase of $9 Million over FY 2003.

The bill also addresses telemarketing. It provides that "$23,100,000 in offsetting collections derived from fees sufficient to implement and enforce the Telemarketing Sales Rule, promulgated under the Telephone Consumer Fraud and Abuse Prevention Act (15 U.S.C. 6101 et seq.), shall be credited to this account, and be retained and used for necessary expenses in this appropriation".

It also provides that "not later than 60 days after the date of enactment of this Act, the Federal Trade Commission shall amend the Telemarketing Sales Rule to require telemarketers subject to the Telemarketing Sales Rule to obtain from the Federal Trade Commission the list of telephone numbers on the `do-not-call´ registry once a month."

Electronic Government (E-Gov) Fund. The bill appropriates $3,000,000 "For necessary expenses in support of interagency projects that enable the Federal Government to expand its ability to conduct activities electronically, through the development and implementation of innovative uses of the Internet and other electronic methods".

See also, House Appropriations Committee's summary of the bill.

House Commerce Committee Takes Up Broadcast Indecency

1/21. Rep. Fred Upton (R-MI), Rep. Ed Markey (D-MA), Rep. Billy Tauzin (R-LA), Rep. John Dingell (D-MI), and others introduced HR 3717, the "Broadcast Decency Enforcement Act of 2004". Also on January 21, Rep. Chip Pickering (R-MS) and others introduced HRes 500, a related resolution. The House Commerce Committee's Subcommittee on Telecommunications and the Internet will hold a hearing on broadcast indecency on Wednesday, January 28, at 10:00 AM.

HR 3717 bill would amend 47 U.S.C. § 503(b)(2) to increase the maximum monetary penalties that the Federal Communications Commission (FCC) can impose upon broadcasters for broadcasting obscene, indecent, or profane language. The bill would allow the FCC to impose a fine of up to $275,000 per violation, or each day of a continuing violation.

18 U.S.C. § 1464 provides that "Whoever utters any obscene, indecent, or profane language by means of radio communication shall be fined under this title or imprisoned not more than two years, or both."

The introduction of this bill follows the imposition of several fines by the FCC for particularly egregious broadcasts that some Commissioners have described as an insufficient deterrent, but nevertheless, the maximum statutory fine.

For example, on December 8, 2003, the FCC released a Forfeiture Order [11 pages in PDF] in its proceeding titled "In the Matter of Infinity Broadcasting Operations, Inc. Licensee of Station WKRK-FM Detroit, Michigan". This order fines Infinity $27,500, the maximum fine for a single utterance in violation of 18 U.S.C. § 1464 and section 73.3999 of the FCC's rules. Commissioner Michael Copps wrote in a separate statement [PDF] that "a fine of $27,500 is not even a slap on the wrist to Infinity". See, story titled "FCC Fines Infinity for Broadcasting Garbage" in TLJ Daily E-Mail Alert No. 795, December 9, 2003.

See also, stories titled "FCC Fines Infinity for Indecent Broadcasts" in TLJ Daily E-Mail Alert No. 752, October 3, 2003, and "FCC Fines Broadcaster for Indecency, Threatens Revocation" in TLJ Daily E-Mail Alert No. 637, April 4, 2003.

This bill also follows the FCC's October 3, 2003 Memorandum Opinion and Order in its proceeding titled "In the Matter of Complaints Against Various Broadcast Licensees Regarding Their Airing of the `Golden Globe Awards´ Program". The FCC did not impose a fine in this matter. It concluded that the broadcasters that aired the Golden Globe Awards program on January 19, 2003, did not violate the law. (A rock music performer who goes by the name "Bono" used an obscene word.)

The bill provides, in part, that "if the violator is (i) a broadcast station licensee or permittee, or (ii) an applicant for any broadcast license, permit, certificate, or other instrument or authorization issued by the Commission, and the violator is determined by the Commission under paragraph (1) to have broadcast obscene, indecent, or profane language, the amount of any forfeiture penalty determined under this section shall not exceed $275,000 for each violation or each day of a continuing violation, except that the amount assessed for any continuing violation shall not exceed a total of $3,000,000 for any single act or failure to act."

It was referred to the House Commerce Committee. The bills' sponsors include the Chairman and ranking Democrat on both the full Committee and the Telecommunications Subcommittee, as well as twenty-two other Representatives, most of whom are members of the Commerce Committee. Support for this bill is bipartisan.

Rep. Chip PickeringMeanwhile, Rep. Chip Pickering (R-MS) (at right) and a group of Republican Representatives introduced HRes 500, "Expressing the sense of the House of Representatives that the Federal Communications Commission should vigorously enforce indecency and profanity laws pursuant to the intent of Congress in order to protect children in the United States from indecent and profane programming on broadcast television and radio."

The findings recited in this resolution include this. The FCC "has not used all of its available authority to impose penalties on broadcasters that air indecent material even when egregious and repeated violations have been found ..."

This resolution states that the FCC should reverse the Enforcement Bureau's decision in the Golden Globe Awards proceeding, "in light of the public policy considerations of protecting children from indecent and profane material".

This resolution also states that the FCC should "return to vigorously and expeditiously enforcing the indecency and profanity statute pursuant to its declaratory order In the Matter of a Citizen's Complaint Against Pacifica Foundation Station WBAI(FM), 56 F.C.C.2d 94 (1975), which was affirmed by the United States Supreme Court", in FCC v. Pacifica Foundation, 438 U.S. 726 (1978).

This resolution was also referred to the House Commerce Committee. Rep. Pickering is a member.

HRes 500 is very similar, but not identical, to SRes 283, introduced on December 9, 2003 by Sen. Jeff Sessions (R-AL) and others.

On Wednesday, January 28, the House Commerce Committee's Subcommittee on Telecommunications and the Internet will hold a hearing titled "Can you say that on TV?': An Examination of the FCC's Enforcement with Respect to Broadcast Indecency".

Court Rules on Jurisdiction Over Suit for Breach of Contract by Cell Phone Company

1/22. The U.S. Court of Appeals (7thCir) issued its opinion [10 pages in PDF] in Fedor v. Cingular Wireless, a case regarding whether the federal or state courts have jurisdiction over a claim that a cell phone company breached its contract with its customers as a result of the timing of its billing for certain calls. Cingular Wireless argued that while the complaint pleads breach of contract, the claim is preempted by 47 U.S.C. § 332(c)(3)(A), and hence, may be removed to federal court. The Appeals Court disagreed, and sent the case back to the state court.

James Fedor filed a complaint in state court against Cingular alleging only state causes of action. He also sought class action status. Fedor wants this action to proceed in state court. Cingular wants it to proceed in federal court.

Fedor contracted with Cingular for cellular telephone service under a fixed rate plan. That is, for a fixed monthly rate, he was entitled to use a certain number of minutes. Pursuant to the contract, if he exceeded the maximum number of minutes, he incurred an additional change.

Cingular did bill him additional charges for exceeding the maximum number of minutes allowed under his rate plan. However, Cingular billed Fedor in one month for calls made in another month. Had Cingular only billed Fedor for calls according to the month in which they were made, it would not have billed him for exceeding his monthly time limit.

Federal jurisdiction must be based upon either diversity of citizenship or a federal question. This case lacks diversity of citizenship. Hence, Cingular asserted federal question jurisdiction, on the argument that Fedor's state law contract claim was preempted by Section 332 of the Communications Act.

Cingular removed the action from Illinois state court to the U.S. District Court (NDIll), pursuant to 28 U.S.C. § 1441(b), which provides, in part, that "Any civil action of which the district courts have original jurisdiction founded on a claim or right arising under the Constitution, treaties or laws of the United States shall be removable without regard to the citizenship or residence of the parties".

Fedor then moved to remand the case back to state court. The District Court held that Fedor's claim was preempted by Section 332.

Subsection 332(c)(3)(A) provides that "no State or local government shall have any authority to regulate the entry of or the rates charged by any commercial mobile service or any private mobile service, except that this paragraph shall not prohibit a State from regulating the other terms and conditions of commercial mobile services."

Cingular argued both components -- both "rates changed" and "entry". The Court of Appeals rejected both arguments, reversed the U.S. District Court, and remanded the case to the Illinois state court.

The Appeals Court reasoned that "A state court civil action may be removed to federal court if the claim arises under federal law." In addition, "Under the well-pleaded complaint rule, absent diversity jurisdiction, a case will not be removable if the complaint does not affirmatively allege a federal claim."

"Moreover, the availability of a federal defense to those state claims does not provide a basis for removal." The Appeals Court continued that "Where a federal statute completely preempts the state-law cause of action, the claim, although pleaded in terms of state law, is in reality based on federal law, and therefore the claim is removable under 28 U.S.C. § 1441(b)."

Hence, the Appeals Court concluded that the issue "is whether the complaint actually challenges rates or market entry."

The Court summarized Cingular's argument: "the complaint involves the timing of the billing and the amount billed, and therefore constitutes a challenge to rates. Essentially, Cingular would interpret the preemption provision as covering any claim that touches on the rates charged in any manner. Because the complaint alleges that Fedor’s calls were improperly billed, Cingular asserts that it challenges the rates."

The Court concluded that this "overstates the scope of the preemption" and is inconsistent with judicial and FCC precedent.

The Appeals Court reasoned that "Fedor asserts that Cingular agreed to provide him with a certain number of minutes of call-time each month, and that calls within that month that exceeded the allotted time would be subject to an additional fee. Fedor does not challenge the reasonableness of those charges, nor does he ask the court to determine whether the services provided were sufficient to justify the charges. Fedor merely argues that Cingular inappropriately attributed calls made in one month to the call-time for a different month, thus assessing charges that were different from the contract terms. A state court analyzing this claim would need to refer to the rates in assessing damages, but would never examine the reasonableness of those rates."

The Court concluded that "these claims address not the rates themselves, but the conduct of Cingular in failing to adhere to those rates. That is precisely the type of state law contract and tort claims that are preserved for the states under § 332 as the ``terms and conditions´´ of commercial mobile services."

Next, the Appeals Court addressed Cingular's argument that Fedor's contract claim challenges "market entry" within the meaning of Section 332.

The Court summarized Cingular's argument: "the claims would necessarily require alterations to its infrastructure because the calls for which billing is delayed are those that involve roaming (calls outside the service territory). Cingular cannot bill for those calls immediately because it must wait for the operators of the cellular towers in those areas to provide the billing information. Accordingly, Cingular argues that success on this complaint would require it to build its own cellular towers in all of those areas, thus mandating changes in its infrastructure and thereby impacting market entry."

The Court was not impressed. It wrote, "That argument stretches the allegations of the complaint beyond recognition."

The Court explained that "The claims merely require Cingular to bill its customers in accordance with the terms of its agreements. That is an accounting problem, not an infrastructure problem, and at most would require Cingular to either (1) adjust its billing system so that the amount owed is calculated based on the minutes remaining and fees applicable to the months in which the call was made or, (2) alter its contract to provide that roaming charges are separately billed under the contract and may be attributed to another month."

This case is James Fedor v. Cingular Wireless Corporation, U.S. Court of Appeals for the 7th Circuit, No. 02-3332, an appeal from the U.S. District Court for the Northern District of Illinois, Eastern Division, No. 01 C 6849, Judge William Hibbler presiding.

Greenspan Addresses Info Tech and Economic Flexibility

1/26. Federal Reserve Board Chairman Alan Greenspan gave a speech via satellite to the HM Treasury Enterprise Conference, in London, England, titled "Economic Flexibility".

He praised free markets, deregulation, flexible labor markets, and Joseph Schumpeter, while dismissing government planning and John Maynard Keynes. And, in the process, he analyzed the role on innovative information technologies in contributing to economic flexibility. Flexibility, said Greenspan "implies a faster response to shocks and a correspondingly greater ability to absorb their downside consequences and to recover from their aftermath."

Greenspan stated that "Joseph Schumpeter, the renowned Harvard professor, called ``creative destruction,´´ the continuous scrapping of old technologies to make way for the innovative. In that paradigm, standards of living rise because depreciation and other cash flows of industries employing older, increasingly obsolescent, technologies are marshaled, along with new savings, to finance the production of capital assets that almost always embody cutting-edge technologies. Workers, of necessity, migrate with the capital."

He added that "Through this process, wealth is created, incremental step by incremental step, as high levels of productivity associated with innovative technologies displace lesser productive capabilities. The model presupposes the continuous churning of a flexible competitive economy in which the new displaces the old."

He also addressed the role of information technologies. He stated that "Beyond deregulation and culture change, innovative technologies, especially information technology, have been major contributors to enhanced flexibility. A quarter-century ago, companies often required weeks to unearth a possible inventory imbalance, allowing production to continue to exacerbate the excess. Excessive inventories, in turn, necessitated a deeper decline in output for a time than would have been necessary had the knowledge of their status been fully current. The advent of innovative information technologies has significantly foreshortened the reporting lag, enabling flexible real-time responses to emerging imbalances."

In addition, "Deregulation and the newer information technologies have joined, in the United States and elsewhere, to advance financial flexibility, which in the end may be the most important contributor to the evident significant gains in economic stability over the past two decades."

He elaborated that "recent regulatory reform coupled with innovative technologies has spawned rapidly growing markets for, among many other products, asset-backed securities, collateral loan obligations, and credit derivative default swaps."

Also, "Financial derivatives, more generally, have grown throughout the world at a phenomenal rate of 17 percent per year over the past decade. Conceptual advances in pricing options and other complex financial products, along with improvements in computer and telecommunications technologies, have significantly lowered the costs of, and expanded the opportunities for, hedging risks that were not readily deflected in earlier decades."

Washington Tech Calendar
New items are highlighted in red.
Tuesday, January 27

New Hampshire Presidential Primary.

The House will meet at 12:30 PM for morning hour and at 2:00 PM legislative business. The House will consider several non technology related items under suspension of the rules. Votes will be postponed until 6:30 PM. See, Republican Whip notice.

10:00 AM - 4:00 PM. The Federal Communications Commission (FCC) will host an event titled "Satellite Rural Forum". The agenda includes, among other topics, broadband access, information and mass media entertainment, telemedicine and distance learning. See, notice and agenda [5 pages in PDF]. Location: FCC, 455 12th Street, SW.

12:15 PM. The Federal Communications Bar Association's (FCBA) Cable Practice Committee will host a brown bag lunch. The topic is "Meet the FCC Internet Policy Working Group Co-Directors". The speakers will be Jeff Carlisle and Bob Pepper. RSVP to

Wednesday, January 28

The House will meet at 10:00 AM for legislative business. It will consider S 1920 (a bankruptcy related bill) and S 610 (a NASA related bill).See, Republican Whip notice.

9:30 AM. The U.S. Court of Appeals (DCCir) will hear oral argument in USTA v. FCC, No. 00-1020. Judges Edwards, Randolph and Williams will preside. Location: 333 Constitution Ave., NW.

10:00 AM. The House Commerce Committee's Subcommittee on Telecommunications and the Internet will hold a hearing titled "Can you say that on TV?': An Examination of the FCC's Enforcement with Respect to Broadcast Indecency". The hearing will be webcast. See, notice. Press contact: Ken Johnson or Jon Tripp at 202 225-5735. Location: Room 2123, Rayburn Building.

10:00 AM. The House Judiciary Committee will meet to mark up seven bills, including HR 2824, the "Internet Tobacco Sales Enforcement Act", HR 1768, the "Multidistrict Litigation Restoration Act of 2003 ", and HR 1073, an untitled bill to repeal Section 801 of the Revenue Act of 1916, which is codified at 15 U.S.C. § 72. The event will be webcast. Press contact: Jeff Lungren or Terry Shawn at 202 225-2492. Location: Room 2141, Rayburn Building.

10:00 AM. The Senate Judiciary Committee will hold a hearing on the nomination of Franklin Van Antwerpen to be a Judge of the U.S. Court of Appeals for the 3rd Circuit. See, notice. Press contact: Margarita Tapia (Hatch) at 202 224-5225 or David Carle (Leahy) at 202 224-4242. Location: Room 226, Dirksen Building.

12:15 PM. The Federal Communications Bar Association's (FCBA) Online Communications Practice Committee will host a brown bag lunch titled "Legislative and Regulatory Update on Internet and E-Commerce Privacy Issues". The speakers will be Chris Hoofnagel (EPIC) and Heidi Salow (Nextel). For more information, contact Vincent Paladini, Karlyn Stanley (CRB, 202 828-9835), or Amy Wolverton. Location: Cole Raywid & Braverman, 1919 Pennsylvania Ave., NW, Suite 200.

6:00 - 8:15 PM. The Federal Communications Bar Association (FCBA) Wireless Practice Committee will host a Continuing Legal Education (CLE) program titled "Implementing the FCC's Secondary Markets Order". The prices to attend range from $50 to $125. Location: Wiley Rein & Fielding, 1750 K Street, NW, 10th Floor.

Deadline to submit requests to participate in the U.S. Patent and Trademark Office (USPTO) public round table meeting on the effectiveness of inter partes reexamination proceedings, tentatively scheduled for February 17, 2004. See, notice in the Federal Register, December 30, 2003, Vol. 68, No. 249, at Pages 75217 - 75218.

Thursday, January 29

CANCELLED. 10:00 AM - 12:00 NOON. The American Enterprise Institute (AEI) will host a program titled "The Dynamics of Two-Sided Markets". The AEI notice states nothing further about the program or its speakers. However, economists use the term "two sided markets" to describe markets for products that must be promoted to two groups to succeed, such as operating systems (developers and users) and payment systems (merchants and consumers). Location: AEI, 12th floor, 1150 17th St., NW.

11:00 AM. The Cato Institute will host a panel discussion titled "Antitrust in the High-Tech Marketplace: The Real Irrational Exuberance?". The speakers will be Lawrence Lindsey (Lindsey Group), Fred Smith (Competitive Enterprise Institute), Jonathan Zuck (Association for Competitive Technology), and Ed Black (Computer and Communications Industry Association). See, notice. The event will be webcast. Lunch will follow the program. Location: Cato, 1000 Massachusetts Avenue, NW.

2:00 - 4:00 PM. The State Department's International Telecommunication Advisory Committee --Radiocommunication Sector (ITAC-R) will hold a meeting to discuss "matters related to the preparations for ITU-R study group meetings taking place in 2004". See, notice in the Federal Register, January 15, 2004 Vol. 69, No. 10, at Page 2380. Location: The Boeing Company, Harry C. Stonecipher Conference Center, 1200 Wilson Boulevard, Arlington, VA.

TIME? Rosemary Coombe (York University) will give a lecture titled "The Globalization of Intellectual Property: Informational Capital and Its Cultures". This is a part of Georgetown University Law Center's (GULC) Colloquium on Intellectual Property & Technology Law Series. For more information, contact Julie Cohen at 202 662-9871. Location: GULC, 600 New Jersey Ave., NW.

6:00 - 8:15 PM. The Federal Communications Bar Association (FCBA) Wireless Practice Committee will host a Continuing Legal Education (CLE) program titled "Political Broadcasting Regulations". Bobby Baker (Assistant Chief of the FCC's Media Bureau's Policy Division), Jack Goodman (General Counsel of the National Association of Broadcasters), and Dawn Sciarrino. The prices to attend range from $50 to $125. Location: 8th Floor Conference Room, Dow Lohnes & Albertson, 1200 New Hampshire Ave., NW.

Friday, January 30

10:00 AM - 12:00 NOON. The Federal Communications Commission's (FCC) Advisory Committee for the 2007 World Radiocommunication Conference will hold its first meeting. See, FCC notice and agenda [PDF] and notice in the Federal Register, December 22, 2003, Vol. 68, No. 245, at Page 71106. See also, TLJ story titled "Powell Appoints Nancy Victory to WRC-07 Post". Location: FCC, Commission Meeting Room (TW-C305), 445 12th Street, SW.

Extended deadline to submit comments to the Federal Communications Commission (FCC) regarding BellSouth's request for a declaratory ruling that the state commissions may not regulate broadband internet access services by requiring BellSouth to provide wholesale or retail broadband services to voice service customers of competitive local exchange carriers (CLECs) using unbundled network elements (UNEs). BellSouth submitted its 334 page filing on December 9, 2003. See, "Emergency Request for Declaratory Ruling" (without attachments) [35 pages in PDF]. This is WC Docket No. 03-251. See, FCC notice [PDF].

Saturday, January 31

Deadline to submit comments to the National Institute of Standards and Technology (NIST) regarding the first public draft [238 pages in PDF] of NIST Special Publication (SP) 800-53, titled "Recommended Security Controls for Federal Information Systems". See, NIST release, and story titled "NIST Releases Draft Information Security Guidelines for Federal Agencies", in TLJ Daily E-Mail Alert No. 777, November 12, 2003.

Deadline to submit comments to the Internal Revenue Service (IRS) regarding its notice in the Federal Register stating that it "will provide the ability for IRS e-file program participants to use approved encryption methods for the 2005 and later filing seasons, beginning with the Acceptance Testing System (ATS) in late 2004. For the 2005 filing season, IRS intends to begin discontinuing support of non-encrypted transmissions whether by dedicated or dial-up links on the Public Switched Telephone Network (PSTN)." See, Federal Register, December 29, 2003, Vol. 68, No. 248, at Pages 75022 - 75023.

Tuesday, February 3

Presidential primaries will be held in the states of Arizona, Delaware, Missouri, Oklahoma, and South Carolina. New Mexico will hold presidential caucuses.

Day one of a two day Continuing Legal Education (CLE) program titled "Communications Law 101: Everything You Wanted (or Didn't Want) to Know About Communications Technology". The event is sponsored by the Federal Communications Bar Association (FCBA) and the Georgetown University Law Center (GULC). Location: GULC.

The Department of State's (DOS) ITU-T Study Group 13 will meet from February 3 through February 13, 2004. See, notice in the Federal Register, October 31, 2003, Vol. 68, No. 211, at Pages 62158.

Deadline to register to attend the National Institute of Standards and Technology's (NIST) event titled "Spam Technology Workshop". The price to attend is $70. See, notice in the Federal Register, November 25, 2003, Vol. 68, No. 227, at Pages 66075 - 66076.

Deadline to submit comments to the Federal Bureau of Investigation (FBI) regarding its document titled "Final notice of capacity". This pertains to the FBI's implementation of  the Communications Assistance for Law Enforcement Act (CALEA), which is codified at 47 U.S.C. § 1001, et seq. The FBI published this notice in the Federal Register, December 5, 2003, Vol. 68, No. 234, at Pages 68112 - 68121. See also, story titled "FBI Publishes CALEA Final Notice of Capacity" in TLJ Daily E-Mail Alert No.797, December 11, 2003.

Deadline to register for the National Institute of Standards and Technology's (NIST) Computer Security Division's (CSD) and Advanced Network Technologies Division's (ANTD) one day conference titled "Spam Technology Workshop", to be held on February 17. See, notice and conference website.

Appeals Court Affirms in CBC v. Disney

1/26. The U.S. Court of Appeals (8thCir) issued its opinion [16 pages in PDF] in Children's Broadcasting Corp. v. Disney, a case involving misappropriation of trade secrets in the broadcast radio industry. This is the second time that this case has come before the Court of Appeals. In this appeal, the Appeals Court affirmed the District Court

The Children's Broadcasting Corp. (CBC) created a 24 hour radio format aimed at children and their parents in the early 1990s. (It sold its radio stations to the Catholic Radio Network in 1998). In 1995 CBC entered into a contract with ABC Radio. (Disney acquired ABC Radio in 1996.)

ABC Radio, which did not have a competing format in 1995, contracted to provide CBC services, including advertising sales, affiliate development, and consulting. CBC and ABC Radio agreed to keep information developed during the term of the agreement confidential and to use this information only for the purposes of the agreement. However, the agreement was terminable at will. In 1996 ABC Radio terminated the agreement, and began its own children's radio format.

CBC filed a complaint in U.S. District Court (DMinn) against Disney and ABC Radio, alleging a variety of claims. The claims that survived the defendants' motion for summary judgment were misappropriation of trade secrets, breach of contract for failure to use reasonable efforts to sell advertising and develop affiliates, and breach of the contractual duty of confidentiality.

In the first trial, the jury found that the defendants had misappropriated CBC's advertiser list and rate information, and awarded it $10 Million from each defendant. The jury also found that ABC Radio breached the contract with respect to advertising sales and confidentiality and awarded $20 Million. The District Court then granted defendants judgment as a matter of law (JMOL) on the grounds that CBC had not presented sufficient evidence as to causation and damages. It also granted an alternative motion for a new trial on the issue of damages.

In the first appeal, the Appeals Court reversed the JMOL, but affirmed the grant of a new trial on damages. The Appeals Court issued its first opinion [19 pages in PDF] on April 10, 2001. That opinion is reported at 245 F.3d 1008. See also, story titled "Misappropriation of Trade Secrets" in TLJ Daily E-Mail Alert No. 163, April 11, 2003.

On remand, CBC presented evidence that ABC Radio and Disney had accelerated their entry into the children’s radio market by using information about advertising and marketing they obtained from CBC and its children's radio network. The trial jury awarded CBC $1.5 Million for breach of contract, and $8 Million for breach of the contractual duty of confidentiality and misappropriation of the trade secret.

The present cross appeals followed. The Appeals Court affirmed the District Court on all issues.

This case is Children's Broadcasting Corporation v. The Walt Disney Company and ABC Radio Networks, Inc., U.S. Court of Appeals for the 8th Circuit, Nos. 02-3161 and 02-3310, appeals from the U.S. District Court for the District of Minnesota.

USTR Makes Announcement Re Costa Rica, CAFTA, Communications and IPR

1/26. The Office of the U.S. Trade Representative (USTR) announced that "United States and Costa Rica today concluded negotiations to finalize Costa Rica's participation in the U.S.-Central America Free Trade Agreement (CAFTA)". See, USTR release [4 pages in PDF].

The USTR added that "Costa Rica made specific commitments to gradually open its telecommunications market in three key areas -- private network services, Internet services, and wireless services and committed to establishing a regulatory framework to help foster effective market access."

In addition, the USTR stated that "Costa Rica's full participation in CAFTA will streamline trade, promote investment, slash tariffs on goods, open trade in services, protect advanced intellectual property ..."

The draft CAFTA agreement has not been released. However, the USTR stated that it "will be made public before the end of January."

The USTR further stated that this agreement will provide "State-of-the-art protections and non-discriminatory treatment are provided for digital products such as U.S. software, music, text, and videos. Protections for U.S. patents, trademarks and trade secrets are strengthened."

NTIA Official Addresses Rights of Way and Broadband Deployment

1/22. Meridith Attwell, the just hired Special Advisor to Michael Gallagher, the not yet confirmed Administrator of the National Telecommunications and Information Administration (NTIA), gave a speech to the International Rights of Way Association (IRWA) in Washington DC.

With respect to federal rights of way, she stated that "A key to widespread broadband deployment is ensuring that broadband providers have timely and cost-effective access to rights-of-way -- so that they can build out their networks across the Nation. In the broadband context, rights-of-way include access to the conduits, corridors, trenches, tower sites, undersea routes and other locations that broadband networks occupy. These passageways often cross large areas of land owned or controlled by the Federal Government. Thus, effective and efficient federal rights-of-way policies and practices are critical for promoting broadband deployment."

She continued that "To ensure the Federal Government's rights-of-way policies and practices facilitate the aggressive deployment of broadband networks, and to lead by example, the Bush Administration created a Federal Rights-of-Way Working Group in July 2002. The Working Group was composed of representatives of most of the major federal agencies with land management responsibilities. The Working Group's mission was to identify and recommend changes in federal laws, regulations, policies, and practices that would improve the process for obtaining rights-of-way on federally-owned of federally-controlled real property for the deployment of broadband networks."

The Working Group has not released its report. Attwell stated that a draft report is "now circulating for final review by affected agencies. We expect that the process will be completed soon."

She added that the Working Group "looked for ways to streamline and standardize applications", "examined practices that could facilitate timely review" of applications, "studied various fee structures", and "sought examples of remediation and maintenance requirements" to ensure that "broadband providers construct, operate, and maintain rights-of-way as authorized".

With respect to state and local rights of way, Attwell stated that the "NTIA has no jurisdiction over states and municipalities".

See also, January 7, 2004 NTIA release announcing the hiring of Attwell.

People and Appointments

1/20. Rep. Ralph Hall (R-TX) resigned as a member of the House Democratic Caucus. See, Congressional Record, January 20, 2004, at page H2. Earlier this month, he switched his party affiliation. See, story titled "Rep. Hall Becomes a Republican" in TLJ Daily E-Mail Alert No. 809, January 5, 2004. Rep. Hall had also been a member of the House Commerce Committee and House Science Committee. He currently has no committee assignments.

1/21. Rep. Charles Gonzalez (D-TX) was appointed to the House Commerce Committee. See, HRes 495, approved by the House on January 21, 2004. Rep. Gonzalez resigned as a member of the House Financial Services Committee, House Select Committee on Homeland Security, and House Small Business Committee. Rep. Gonzalez replaces Rep. Ralph Hall (R-TX).

1/21. Rep. Bart Gordon (D-TN) was named ranking Democrat on the House Science Committee. He replaces the former ranking Democrat, Rep. Ralph Hall (R-TX).

Barry Ohlson

1/26. Federal Communications Commission (FCC) Commissioner Jonathan Adelstein named Scott Bergmann to be his his Wireline Legal Advisor, effective March 1. He will replace Lisa Zaina. She was recently appointed CEO of the FCC's Universal Service Administrative Company (USAC). Adelstein also announced that Barry Ohlson, who is his Spectrum and International Legal Advisor, will also become his Senior Legal Advisor. Zaina had previously been Senior Legal Advisor. See, FCC release [PDF]. Bergmann has worked at the FCC since 1996, most recently as Deputy Chief of the Wireline Competition Bureau's (WCB) Competition Policy Division. Before that, he was an Interim Legal Advisor to Commissioner Adelstein. He has held various other positions in the WCB. Ohlson joined the FCC in 2001 as a Legal Advisor to Adelstein. Before that, he worked for Winstar Communications as Senior Director for Federal Regulatory Affairs. He has also worked for the law firms of McDermott Will & Emery and Keller & Heckman.

More News

1/26. The Librarian of Congress published a notice in the Federal Register announcing it has accepted in full the determination of the Copyright Arbitration Royalty Panel (CARP) and is announcing the final Phase I distribution of cable royalties for 1998 and 1999. See, Federal Register, January 26, 2004, Vol. 69, No. 16, at Pages 3606 - 3620.

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