Tech Law Journal Daily E-Mail Alert
February 27, 2004, 9:00 AM ET, Alert No. 845.
Home Page | Calendar | Subscribe | Back Issues | Reference
Commerce Department Releases Report on TeleHealth

2/26. The Department of Commerce released a report [118 pages in PDF] titled "Innovation, Demand, and Investment in Telehealth".

The report states that "Tens of thousands of Americans are accessing healthcare remotely from medically underserved areas such as Arctic villages, Native American reservations, prisons, and rural communities. Many more are being diagnosed, treated and monitored from ships at sea, battlefields, urban centers, and homes. However, only a fraction of the potential for technology to increase access to, improve quality of, and reduce the cost of the nation’s healthcare has been realized to date."

The report states that "The market for telehealth technology (products and services) is relatively small and has historically been considered a technical specialty separate from traditional medicine. One of the most important challenges to (and opportunities for) telehealth providers is the integration of technology with clinical medicine." (Parentheses in original.)

The report finds that "Telehealth innovation, adoption and deployment have been impeded by legal, financial and regulatory barriers." It also finds that "progress in addressing public policy issues is often limited by insufficient coordination among stakeholder groups and organizations."

The report identifies some of these barriers. For example, it states that "The issue of state licensure continues to play a role in limiting a national market for and in dampening user acceptance of telehealth technologies, with some suggesting it is less restrictive to sell technologies and services into foreign markets than into a neighboring state."

The report elaborates that "Providers practicing in the field of medicine have traditionally been subject to licensure by state medical and nursing "boards" in the state or other jurisdiction in which the provider’s practice is located. Each state, territory, and the District of Columbia independently determines its own requirements for health care providers to practice in their jurisdiction. Executives interviewed for this report suggested that telehealth has been an enigma to the boards because it extends the practice of medicine into a different jurisdiction. State boards have restricted the practice by out-of-state telehealth providers in a variety of ways, from prohibition to permitting reciprocity to declining to take a position at all."

The report also identifies liability issues. It states that "Issues such as protection of healthcare and telecommunications entities from undue liability arising out of the use of telehealth have not yet been addressed."

The report also addressed intellectual property rights. It finds that "Additional innovation may be stimulated through greater use of ``fast track´´ protection of intellectual property." That is "Additional innovation may be stimulated through "fast track" protection of intellectual property. A good portion of innovation in telehealth occurs locally as a result of improvements in currently operating programs and lessons learned. Innovators in this field, however, tend to be small companies or individuals that often choose not to pursue intellectual property protection for financial reasons, among them the time and possible expense of seeking exclusive rights. As a result, the disclosure of significant advancements in tele health may be delayed. Reducing the time for granting patents by encouraging inventors to use existing ``fast track´´ processes would allow innovative technologies to reach the marketplace and healthcare consumer sooner."

The primary authors of the report are David Brantley and Karen Cummings of the DOC's Technology Administration's Office of Technology Competitiveness, and Richard Spivack of the National Institute of Standards and Technology's Advanced Technology Program.

Phil Bond, the Under Secretary of Commerce for Technology, presented the report at an event on Capitol Hill hosted by the Steering Committee on Telehealth and Healthcare Informatics.

Rep. DeLauro and Rep. Dingell Introduce Outsourcing Protectionism Bill

2/24. Rep. Rosa DeLauro (D-CT) and Rep. John Dingell (D-MI) introduced HR 3820, the "United States Workers Protection Act of 2004". The bill would amend the Office of Federal Procurement Policy Act, which is codified at 41 U.S.C. § 403 et seq., to bar most outsourcing by the federal government

Rep. Rosa DeLauroRep. DeLauro (at right) stated in a release that "Outsourcing these jobs is wrong and should not even be an option for the federal government".

The bill provides that "An activity or function of an executive agency that is converted to contractor performance under Office of Management and Budget Circular A-76 may not be performed by the contractor or any subcontractor at a location outside the United States except to the extent that such activity or function was previously performed by Federal Government employees outside the United States."

The bill also provides, that subject to certain exceptions, "A contract for the procurement of goods or services that is entered into by the head of an executive agency may not be performed outside the United States except to meet a requirement of the executive agency for goods or services specifically at a location outside the United States."

The bill was referred to the House Committee on Government Reform.

Panitchpakdi Addresses Doha Round, Multilateralism and Outsourcing

2/26. Supachai Panitchpakdi, Director General of the World Trade Organization (WTO), gave a speech at the National Press Club (NPC) in Washington DC. He advocated free trade, multilateralism, and the Doha round of negotiations. He also addressed the political debate in the US over outsourcing.

Supachai PanitchpakdiPanitchpakdi (at right) stated that "The United States, more than any single country, created the world trading system. The US has never had more riding on the strength of that system. And US leadership -- especially in the current Doha trade talks -- is indispensable to the system's success."

"The Doha Round is a crucial test", said the Director General. "But what is at stake in these talks is more than the economic benefits that would flow from a successful deal. The real issue is the relevance of the multilateral trading system."

He said that "Advancing the Doha agenda would confirm the WTO as the focal point for global trade negotiations, and as the key forum for international economic cooperation. The credibility of the institution would be greatly enhanced. But if the Doha negotiations stumble, doubts may grow, not just about the WTO's effectiveness, but about the future of multilateralism in trade."

He argued that the US has two interests in the Doha negotiation. First, "the US is now integrated with the world economy as never before". And second, "strengthening the world trading system is essential to America's wider global objectives. Fighting terrorism, reducing poverty, improving health, integrating China and other countries in the global economy -- all of these issues are linked, in one way or another, to world trade."

He then discussed the debate in the US over outsourcing of services. He said that "We especially need to inject some clarity -- and facts -- into the current debate over the outsourcing of services jobs. Over the next decade, the US is projected to create an average of more than 2 million new services jobs a year -- compared to roughly 200,000 services jobs that will be outsourced."

He continued that "I am well aware that this issue is the source of much anxiety in America today. Many Americans worry about the potential job losses that might arise from foreign competition in services sectors. But it's worth remembering that concerns about the impact of foreign competition are not new. Many of the reservations people are expressing today are echoes of what we heard in the 1970s and 1980s."

"But people at that time didn't fully appreciate the power of American ingenuity", said Panitchpakdi. "Remarkable advances in technology and productivity laid the foundation for unprecedented job creation in the 1990s and there is no reason to doubt that this country, which has shown time and again such remarkable potential for competing in the global economy, will not soon embark again on such a burst of job-creation."

"America's openness to service-sector trade -- combined with the high skills of its workforce -- will lead to more growth, stronger industries, and a shift towards higher value-added, higher-paying employment. Conversely, closing the door to service trade is a strategy for killing jobs, not saving them. Americans have never run from a challenge and have never been defeatist in the face of strong competition. Part of this challenge is to create the conditions for global growth and job creation here and around the world."

He concluded by stating that "It would be a tragic mistake if the Doha Round, which offers the world a once in a generation opportunity to eliminate trade distortions, to strengthen trade rules, and open markets across the world, were allowed to founder. We need courage and the collective political will to ensure a balanced and equitable outcome."

"What is the alternative? It is a fragmented world, with greater conflict and uncertainty", said Panitchpakdi.

Lamy Addresses Doha Agenda

2/26. EU Trade Commissioner Pascal Lamy gave a speech titled "Moving the Doha Development Agenda Forward". He spoke to the European-American Business Council (EABC) in Washington DC.

Pascal LamyLamy (at right) stated that "here we are in early 2004, with the Round officially coming out of its post-Cancun swoon. And this time round, the prediction that I keep hearing is that it is completely hopeless to try to make progress in 2004, because, they all tell me, the US never moves on trade in an election year. Well let me tell you, I find these kinds of statements pretty annoying. And I imagine that Bob Zoellick does, too. Because, if that it is true, both of us have wasted the best part of two months flying just about everywhere to push the case for the Doha Development Agenda [DDA], and we aren't alone in that."

"Do not assume that 2004 is a year for the dogs on the Doha Round." He continued; "what can we achieve in 2004? Answer: significant progress across the board. Sort of between half and two-thirds of the way to the end of the Round."

Senators Write in Opposition to State Taxation of Internet Access

2/24. Sen. George Allen (R-VA), Sen. Ron Wyden (D-OR), Sen. John Sununu (R-NH), Sen. Conrad Burns (R-MT), Sen. Gordon Smith (R-OR), and Sen. John Ensign (R-NV) sent a "Dear Colleague" letter to other members of the Senate regarding S 150, the "Internet Tax Nondiscrimination Act", and S 2084, the "Internet Tax Ban Extension and Improvement Act".

  Sen. Ron

They write that S 150 "will likely be before the Senate in the very near future. Opponents of this legislation are floating a new bill seeking your support to tax consumers of Internet access. As Members of the Senate Committee on Commerce, Science, and Transportation, we think that it is important to provide context, truth and clarity to their position and proposal."

They proceed to offer criticism of S 2084, which is sponsored by Sen. Lamar Alexander (R-TN), Sen. Tom Carper (D-DE), and others.

They state that "Represented as a so-called ``compromise,´´ the new bill is far from it." They state that it "is an effort to gain Federal legal protection for the actions of several State and local revenue authorities that have used administrative rulings to do an end-run on the moratorium on Internet access taxes."

Sen. Lamar Alexander  
Sen. Lamar

They continue that S 2084 would "Authorize existing illegal taxes on Internet access for high-speed broadband connections (e.g., taxes on Digital Subscriber Lines) that some States and localities have imposed today." (Parentheses in original.)

They also state that S 2084 would "Authorize new taxes by narrowing the definition of Internet Access to cover only the connection between purchaser of Internet access and the Internet service provider. Tax collectors will merely push the taxes up the network line and consumers will pay these taxes in one form or another."

They conclude, "Simply put, supporting this bill would mean that you support taxing internet access".

See also, story titled "Sen. Alexander Introduces Bill Regarding Internet Tax Moratorium", also published in TLJ Daily E-Mail Alert No. 838, February 17, 2004.


2/26. TLJ corrects three errors in the story titled "Sen. Alexander Introduces Bill Regarding Internet Tax Moratorium" in TLJ Daily E-Mail Alert No. 838, February 17, 2004.

First, in paragraph 27, the words "the bill" should have appeared after the word "passed". That is, the sentence is corrected to read as follows: "The full House passed the bill on September 17, 2003." (Emphasis added.)

Second, in paragraph 35, sentence 2, the word "not" should have appeared after the word "has". That is, the story first states that the House passed HR 49, and the Senate Commerce Committee passed S 150. Then, the following sentence is corrected to read as follows: "However, the full Senate has not passed either this bill, or the House version." (Emphasis added.)

Third, the description of the grandfather language of S 150 was incorrect. Paragraph 37 incorrectly stated that "S 150 sunsets the grandfather clause of the 1998 ITFA after three years." This sentence is corrected to read as follows: "S 150 expands the scope of the grandfather provision, and sunsets it after three years". Also, in paragraph 48 (which is part of the discussion of the grandfathering language of S 2084) the following sentence is added: "S 150 contains similar language."

That is, the original Internet Tax Freedom Act (ITFA) grandfathered existing taxes that were "generally imposed and actually enforced" in 1998. HR 49 deletes this grandfather clause. S 150 expands the scope of the grandfather provision, but also sunsets it after three years. S 2084 also expands the scope of the grandfather provision, with language similar to that of S 150. However, it does not sunset it. The TLJ story was incorrect to the extent that it did not identify that S 150, like S 2084, includes language that expands the scope of the grandfather provision.

These errors have been corrected in the TLJ web site.

Washington Tech Calendar
New items are highlighted in red.
Friday, February 27

8:25 AM - 3:00 PM. The Department of Homeland Security's (DHS) Homeland Security Science and Technology Advisory Committee (HSSTAC) will meet in closed session. See, notice in the Federal Register, February 13, 2004, Vol. 69, No. 30, at Page 7245. Location: The Bolger Center, 9600 Newbridge Drive, Potomac, MD.

9:00 AM - 4:00 PM. The National Institute of Standards and Technology's (NIST) will host an 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. Location: NIST, Administration Building (Building 101), Green Auditorium, Gaithersburg, MD.

The National Institute of Standards and Technology's (NIST) Computer Security Division (CSD) will hold a workshop on DRAFT Special Publication 800-60, titled "Guide for Mapping Types of Information and Information Systems to Security Categories". See, Volume I [PDF] and Volume II [PDF]. This is a repeat of the February 26 workshop. The workshop is open to government workers only. For more information, contact Elaine Frye at

Deadline to submit comments to the National Telecommunications and Information Administration (NTIA) in response to its notice in the Federal Register requesting comments to assist it in developing recommendations to the Federal Communications Commission (FCC) on the use of the 3650-3700 MHz band for unlicensed devices, such as 802.11 (WiFi) and BlueTooth. The FCC released its Notice of Inquiry [MS Word] on December 20, 2002. This is ET Docket No. 02-380. See, Federal Register, January 28, 2004, Vol. 69, No. 18, at Pages 4118 - 4120. See also, story titled "FCC Announces Notice of Inquiry Re More Spectrum for Unlicensed Use" in TLJ Daily E-Mail Alert No. 566, December 12, 2002, and story titled "NTIA Seeks Comments on Use of 3650-3700 MHz Band By Unlicensed Devices" in TLJ Daily E-Mail Alert No. 832, February 9, 2004.

Monday, March 1

10:30 AM. The Senate Appropriations Committee's Defense Subcommittee will hold a hearing on the proposed budget for the Department of Defense. Location: Room 192, Dirksen Building.

Deadline to submit comments to the Federal Communications Commission (FCC) regarding Level 3 Communications' petition for forbearance requesting the FCC to forbear from application of 47 U.S.C. § 251(g), the exception clause of § 51.701(b)(1) of the FCC's rules, and § 69.5(b) of the FCC's rules to the extent those provisions could be interpreted to permit local exchange carrier (LECs) to impose interstate or intrastate access charges on internet protocol (IP) traffic that originates or terminates on the public switched telephone network (PSTN), or on PSTN-PSTN traffic that is incidental thereto. This is WC Docket No. 03-266. See, FCC notice [3 pages in PDF].

Deadline to submit reply comments to the Federal Communications Commission (FCC) to update the record concerning petitions for reconsideration of rules that the FCC adopted in the 1997 access charge reform docket. See, notice in the Federal Register, January 16, 2004, Vol. 69, No. 11, at Pages 2560 - 2561.

Tuesday, March 2

9:30 AM. The Senate Armed Services Committee will hold a hearing on President Bush's defense authorization request for FY 2005 and the future years defense program. See, notice. Location: Room 216, Hart Building.

10:00 AM. The Senate Appropriations Committee's Subcommittee on Commerce, Justice, State, and the Judiciary will hold a hearing on the proposed budget  for the Department of Commerce (DOC). Location: Room S-146, Capitol Building.

10:00 AM. The Senate Appropriations Committee's Subcommittee on Homeland Security will hold a hearing on the proposed budget for science and technology programs, information analysis, and infrastructure protection. Location: Room 124, Dirksen Building.

10:00 - 11:30 AM. The Federal Communications Commission's (FCC) Media Security and Reliability Council will meet. See, notice in the Federal Register, October 21, 2003, Vol. 68, No. 203, at Page 60104. For more information, contact Barbara Kreisman at 202 418-1600 or Susan Mort 202 418-1043. Location: FCC, Commission Meeting Room, TW-C305, 445 12th Street, SW.

4:00 PM. Gretchen Ann Bender (University of Dayton School of Law) will present a paper titled "The Return to Core Values: Intellectual Property as a Commercialization Tool" in which she argues that intellectual property is simply a tool by which the U.S. distributes, spreads, and commercializes human creativity. 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.

Wednesday, March 3

10:00 AM. The House Financial Services Committee will hold a hearing on Hearing on HR 3574, the "Stock Option Accounting Reform Act". Location: Room 2128, Rayburn Building.

Deadline to submit comments to the Federal Communications Commission (FCC) in response to its Notice of Proposed Rulemaking (NPRM) regarding modifying it frequency coordination rules to promote sharing between non-geostationary satellite orbit (NGSO) and geostationary satellite orbit (GSO) fixed-satellite service (FSS) operations and various terrestrial services operating in several frequency bands. This NPRM considers a joint proposal submitted by SkyBridge and the Fixed Wireless Communications Coalition (Growth Zone Proposal). This is ET Docket No. 03-254.

Thursday, March 4

12:00 NOON - 2:00 PM. The Progress and Freedom Foundation (PFF) will host a luncheon. The speakers will include Charlie Ergen, Ch/CEO of EchoStar Communications. RSVP to Brooke Emmerick at 202 289-8928 or The PFF notice also states that "Members of the media should contact David Fish at 202-289-8928 or" Location: Rotunda Room, Ronald Reagan Building and International Trade Center, 1300 Pennsylvania Ave., NW.

10:00 AM. The House Appropriations Committee's Subcommittee on Homeland Security will hold a hearing on the proposed budget for the Department of Homeland Security (DHS). Secretary Tom Ridge is scheduled to testify. Location: Room 2359, Rayburn Building.

1:00 PM. The House Appropriations Committee's Subcommittee on Commerce, Justice, and State, the Judiciary, and Related Agencies will hold a hearing on the proposed budget for the Department of Justice (DOJ). Location: Room H-309, Capitol Building.

Friday, March 5

12:15 PM. The Federal Communications Bar Association's (FCBA) Wireless Practice Committee will host a luncheon. The topic will be "Meet CTIA's New Federal Regulatory and Congressional Affairs Senior Team". The price to attend is $15. RSVP by 5:00 PM on March 3 to Wendy Parish at For more information contact Laura Phillips at 202 842-8891. Location: Sidley Austin, 1501 K Street, NW, 6th Floor.

CBO Issues Report on FTS/ETI Replacement Proposals

2/24. The Congressional Budget Office (CBO) wrote a report [17 pages in PDF] titled "An Economic Analysis of Alternatives to Tax Reductions in S. 1637". This is a broad bill that includes replacement legislation for the FSC/ETI tax regime.

S 1637, the "Jumpstart Our Business Strength Act", sponsored by Sen. Charles Grassley (R-IA), includes replacement legislation for the Foreign Sales Corporation (FSC) and Extraterritorial Income (ETI) tax regimes, which the World Trade Organization (WTO) held to be illegal export subsidies. S 1637 would  repeal the current  ETI regime and replace it with a tax cut for all manufacturers, including family-held S corporations and partnerships that produce goods within the U.S.

Sen. Don Nickles (R-OK), who requested the CBO report, and Sen. Jon Kyl (R-AZ), have proposed a 2 percentage point cut in the corporate tax rate. The CBO report provides an economic analysis, including the impact on growth, efficiency, jobs, and the competitiveness of U.S. businesses, of these proposals.

The CBO summarized the findings in a cover letter. It stated that "First, an across-the board reduction in the corporate tax rate would improve economic efficiency in all three of the contexts specified. Second, both that cut and one targeted solely toward manufacturing would produce a relatively minor increase in long-term growth compared with the current tax regime and the provisions of S. 1637. Third, none of the alternatives considered would have any significant short-term effect on employment. And fourth, a corporate rate cut would improve the country’s international economic position compared with the current tax regime, but it would have roughly the same effects as the tax cuts embodied in S. 1637 or as a rate cut targeted solely toward manufacturing."

Sen. Grassley also released a memorandum [2 pages in PDF] that responds to the CBO report.

More Trade News

2/25. Rep. Charles Rangel (D-NY) introduced HR 3827, the "Job Protection Act of 2004", a bill that includes replacement legislation for the FSC/ETI tax regime. The bill was referred to the House Ways and Means Committee, of which Rep. Rangel is the ranking Democrat.

2/24. Rep. Marcy Kaptur (D-OH) introduced HRes 532. It is a long and rambling list of charges against international trade, free markets, and investment. It states that it seeks to advance "the common good", "the Earth's natural environment", "the most vulnerable stakeholders", "the integrity of creation, and our common humanity".

Japanese FTC Investigates Microsoft

2/26. Microsoft stated in a release that "The Japanese Fair Trade Commission (JFTC) sent officers to Microsoft's offices in Tokyo today to collect information regarding a patent-related provision in Microsoft's Windows and WinCE OEM contracts with PC and device manufacturers."

Microsoft described the provision under review. "This patent-related provision provided that OEMs who took a license to Microsoft's Windows operating system products, including Microsoft's patents on Windows, should not later sue each other, or Microsoft, on claims that Windows violates their patents."

The Computer & Communications Industry Association (CCIA), a Washington DC based interest group that is devoted in significant part to complaining about Microsoft's business practices, offered an alternative description. It wrote in a release that "Japan is currently investigating the ``non-assertion´´ clauses Microsoft employs against computer manufactures. If a computer manufacturer wants to license Microsoft's Windows, they are forced into agreeing they will not assert any patent license fees against Microsoft."

Microsoft further stated that "This specific provision was reviewed and passed muster under a competition law assessment conducted by the European Commission in 2001. The U.S. Department of Justice reviewed the provision in the mid-1990s. More recently, information concerning the provision was presented to the U.S. District Court of the District of Columbia in connection with the remedies phase of the antitrust lawsuit brought by the U.S. Department of Justice and various states."

The CCIA further stated that "For a monopolist to withhold its monopoly product in order to coerce compliance is unconscionable."

More Capitol Hill News

2/26. Rep. Joe Barton (R-TX), the new Chairman of the House Commerce Committee, scheduled, and then cancelled an event to announce a new Committee structure. He stated in a short release that "I will have additional announcements as to new committee structure and placements next week, and look forward to continuing an active agenda."

2/26. The House Financial Services Committee's Subcommittee on Capital Markets, Insurance and Government Sponsored Enterprises scheduled a hearing for Wednesday, March 3 on HR 3574, the "Stock Option Accounting Reform Act", sponsored by Rep. Richard Baker (R-LA), Rep. Anna Eshoo (D-CA), Rep. David Dreier (R-CA), and 43 others. This is the House companion bill to S 1890, sponsored by Sen. Mike Enzi (R-WY), Sen. Harry Reid (D-NV) and others. These bills would require the expensing of stock options, but only for the top executives of companies, with exemptions for small businesses and start ups.

Computers as Nuisances

2/25. The U.S. Court of Appeals (10thCir) issued its opinion in Santana v. Tulsa, a constitutional challenge to a municipality's enforcement of its nuisance ordinance. One Eddie Santana filed a pro se complaint in U.S. District Court (NDOkla) against the City of Tulsa, where he lives, after it had seized and removed some items from the back yard of his house. The City argued that it had legitimately seized junk pursuant to the city ordinance banning nuisances. The City prevailed below, and Santana brought the present appeal. The Appeals Court affirmed. What is notable about this case is that it did not involve junk autos sitting atop cinderblocks, rusting refrigerators, or such other typical yard junk. The City of Tulsa seized computer parts. This case is Eddie Santana v. City of Tulsa, App. Ct. No. 03-5056, and D.C. No. 02-CV-577-H.

About Tech Law Journal
Tech Law Journal publishes a free access web site and subscription e-mail alert. The basic rate for a subscription to the TLJ Daily E-Mail Alert is $250 per year. However, there are discounts for subscribers with multiple recipients. Free one month trial subscriptions are available. Also, free subscriptions are available for journalists, federal elected officials, and employees of the Congress, courts, and executive branch. The TLJ web site is free access. However, copies of the TLJ Daily E-Mail Alert are not published in the web site until one month after writing. See, subscription information page.

Contact: 202-364-8882; E-mail.
P.O. Box 4851, Washington DC, 20008.
Privacy Policy
Notices & Disclaimers
Copyright 1998 - 2004 David Carney, dba Tech Law Journal. All rights reserved.