Tech Law Journal Daily E-Mail Alert
August 10, 2004, 9:00 AM ET, Alert No. 956.
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District Court Enters Final Order in FTC Case Against Defendants Who Exploited Microsoft Messenger to Display Pop Up Ads

7/28. The U.S. District Court (DMd) approved a Stipulated Final Order [15 pages in PDF] in FTC v. D Squared Solutions LLC, Dinesh Dhingra and Jeffrey Davis, which orders the defendants to cease sending pop up ads to computers using Windows Messenger. See, FTC release.

The Federal Trade Commission (FTC) filed a complaint [11 pages in PDF] last fall alleging unfair trade practices in violation of Section 5 of the Federal Trade Commission Act (FTCA) in connection with the exploitation of the Microsoft Windows Messenger Service to send to computers frequent and unwarranted pop up ads that offered for sale software that stops the ads.

See, story titled "FTC Files Complaint Against Company Exploiting Microsoft Messenger to Display Pop Up Ads" and "FTC Action Creates Uncertainty Regarding Application of FTCA to Internet Communications and Advertising" in TLJ Daily E-Mail Alert No. 774, November 7, 2003.

The District Court issued a Temporary Restraining Order and Order to Show Cause [12 pages in PDF] on October 30, 2003. The present order permanently bars the defendants from sending Windows Messenger Service pop-up advertisements, selling Windows Messenger Service pop-up blocking software, and selling Windows Messenger Service pop-up sending software.

The order also contains provisions pertaining to compliance monitoring, compliance reporting, and record keeping.

However, the defendants did not admit any wrongdoing or liability.

Moreover, the order imposes no fine. It does not require payment of restitution to persons who gave money to defendants. Nor does it require disgorgement of ill gotten gains. The order merely directs the defendants to stop doing what they had been doing.

The FTC and defendants agreed to settle this case early. There are no judicial opinions that might serve as precedent on the application of the FTC Act to unfair business practices online. The final order contains no conclusions of law regarding application of the FTC Act to online business activity.

Section 5 of the FTC Act, which is codified at 5 U.S.C. 45(a), is broad and vague statute. The provides that "Unfair methods of competition in or affecting commerce, and unfair or deceptive acts or practices in or affecting commerce, are hereby declared unlawful." It does not reference any online business practices. Moreover, the FTC has not promulgated any regulations in this area.

This settlement has not brought any clarity to this area of law. See also, story titled "FTC Action Creates Uncertainty Regarding Application of FTCA to Internet Communications and Advertising" in TLJ Daily E-Mail Alert No. 774, November 7, 2003.

This case is FTC v. D Squared Solutions LLC, Dinesh Dhingra and Jeffrey Davis, U.S. District Court for the District of Maryland, Baltimore Division, D.C. No. AMD 03 CV 3108, Judge Andre Davis presiding.

FCC Releases Order on Reconsideration Regarding FTTH to MDUs

8/9. The Federal Communications Commission (FCC) released its Order on Reconsideration [20 pages in PDF] regarding multiple dwelling units (MDUs) and the Section 251 unbundling obligations of incumbent local exchange carriers (ILECs).

The FCC adopted, but did not release, this Order on Reconsideration at its August 4, 2004 meeting. This order is FCC 04-191 in CC Docket Nos. 01-338, CC 96-98, and CC 98-147.

See, story titled "FCC Adopts Order on Reconsideration Re Unbundling Requirements of ILECs for FTTH to MDUs" in TLJ Daily E-Mail Alert No. 954, August 6, 2004.

This order states that "we reconsider certain of the Commission's determinations with regard to multiple dwelling units (MDUs) and conclude that the fiber-to-the-home (FTTH) rules will apply to MDUs that are predominantly residential. We further clarify that the definition of FTTH loops includes fiber loops deployed to the minimum point of entry (MPOE) of MDUs, regardless of the ownership of the inside wiring."

FCC Releases CALEA NPRM

8/9. The Federal Communications Commission (FCC) released its Notice of Proposed Rulemaking and Declaratory Ruling (NPRM & DR) [100 pages in PDF] regarding imposing CALEA obligations upon broadband internet access services, including voice over internet protocol (VOIP), and other information services. This NPRM is 100 pages, single spaced, with 432 footnotes.

It contains significant additional information about the FCC's reconstruction of the Communications Assistance for Law Enforcement Act (CALEA) that the FCC did not disclose at its meeting on August 4, 2004. See, story titled "FCC Adopts NPRM and Declaratory Ruling Regarding CALEA Obligations" in TLJ Daily E-Mail Alert No. 953, August 5, 2004. See also, stories titled "FCC Legislatively Expands Scope of CALEA Obligations" in TLJ Daily E-Mail Alert No. 953, August 5, 2004, and "Powell Discusses Brand X Case" in TLJ Daily E-Mail Alert No. 954, August 6, 2004.

This NPRM also contains a more detailed articulation of how the FCC has come to tentatively conclude that broadband internet access services are subject to CALEA requirements, and that managed or mediated VOIP services are also subject to CALEA requirements.

Comments will be due 45 days after publication of a notice in the Federal Register. Reply comments will be due 75 days after publication in the Federal Register. As of August 10, the FCC had not published this notice in the Federal Register. TLJ plans to publish in a subsequent issue a more detailed review of the content of this NPRM.

FCC Adopts Order Regarding Wireless SPAM

8/4. The Federal Communications Commission (FCC) adopted, but did not release, an order regarding wireless spam at its August 4 meeting. The FCC issued a short release describing this item, and two Commissioners wrote brief separate statements.

This order implements the recently enacted CAN-SPAM Act (Controlling the Assault of Non-Solicited Pormography and Marketing Act of 2003) which was S 877. President Bush signed the bill on December 16, 2003. It is now Public Law No. 108-187.

The CAN-SPAM Act gives primary rulemaking authority to the Federal Trade Commission (FTC), but also gives the FCC authority with respect to "unwanted mobile service commercial messages". It directs the FCC to write rules that "provide subscribers to commercial mobile services the ability to avoid receiving mobile service commercial messages unless the subscriber has provided express prior authorization to the sender", and "allow recipients of mobile service commercial messages to indicate electronically a desire not to receive future mobile service commercial messages from the sender".

The FCC release describing this order states that the FCC has "Interpreted the scope of material covered under the definition of mobile service commercial messages (MSCMs) in the CAN-SPAM Act to include any commercial message sent to an electronic mail address provided by a CMRS provider specifically for delivery to the subscriber's wireless device. The Commission found that Short Message Service messages transmitted solely to phone numbers (as opposed to those sent to addresses with references to Internet domains) are not covered by these protections, but all autodialed calls are already covered by the TCPA." (Parentheses in original.)

This release states that the order prohibits the sending of MSCMs unless the individual addressee has given the sender express prior authorization. This is an opt-in requirement. However, there is no requirement that the authorization be in writing.

The FCC release also states that the FCC "will create a publicly available FCC wireless domain names list containing the domain names used for mobile service messaging. This will enable senders of commercial mail to determine which addresses, containing those domain names, are directed at mobile services." The order also requires all CMRS providers to supply the FCC with names of all the internet domains on which they offer mobile service messaging service. It then prohibits the sending of commercial (but not transactional or relationship) messages to these domains.

See, statement [PDF] of FCC Chairman Michael Powell and statement [PDF] of FCC Commissioner Michael Copps. See also, story titled "FCC Announces Rulemaking on Wireless Provisions of CAN-SPAM Act" TLJ Daily E-Mail Alert No. 855, March 15, 2004.

Steve Largent, P/CEO of the Cellular Telecommunications & Internet Association (CTIA) stated in a release that "The wireless industry has made every effort to protect our consumers' privacy from unsolicited communications. We fought hard to limit telemarketing calls to wireless phones and more recently, have taken proactive steps to eliminate text messaging spam, including installing blocking features, monitoring email and directly targeting spammers ... Implementation of the CAN-SPAM Act will provide consumers additional protections from unwanted e-mails sent to mobile wireless devices".

This item is FCC 04-194 in CG Docket No. 04-53 and No. 02-278

People and Appointments

Jim Harper8/9. Jim Harper (at right) will join the Cato Institute as Director of Information Policy Studies in September. He will focus on privacy related issues, including privacy policy and regulation, database security, digital surveillance, spam, CALEA, and the PATRIOT Act. He will also work on intellectual property issues. He is also the Editor of Privacilla.org.

8/9. Scott Delacourt was named Deputy Bureau Chief of the Federal Communications Commission's (FCC) Wireless Telecommunications Bureau (WTB). He will oversee matters before the WTB's Broadband Division and Spectrum & Competition Policy Division. He was previously Chief of Staff and Associate Bureau Chief of the WTB. He also previously worked for the law firm of Wiley Rein & Fielding. See, FCC release [PDF].

8/4. Federal Communications Commission (FCC) Commissioner Jonathan Adelstein announced several changes in his personal staff at the August 4 meeting of the FCC. Sharon Stewart has moved from Adelstein's office to the FCC's Office of Communications Business Opportunities. Anne Perkins, his Special Assistant, will leave to become Director of Regulatory Affairs at the Satellite Broadcasting and Communications Association (SBCA). Before joining Adelstein's office, she worked at the National Telecommunications Cooperative Association (NTCA). Her last day at the FCC is August 10. Perkins will be replaced by Dionne McNeff who was previously an intern in Adelstein's office. She has one year remaining in her course of study at the Catholic University School of Law.

Washington Tech Calendar
New items are highlighted in red.
Tuesday, August 10

The House and Senate are in recess through September 6.

9:30 AM - 12:00 NOON. The Federal Communications Commission's (FCC) WRC 07 Advisory Committee, Informal Working Group 4: Broadcasting and Amateur Issues. See, notice [PDF]. Location: Shaw Pittman, 2300 N St., NW.

12:00 NOON. The House Armed Services Committee (HASC) will hold a hearing on the report of the National Commission on Terrorist Attacks Upon the United States, which is also known as the 9-11 Commission. Thomas Kean (Chairman of the 9-11 Commission) and Lee Hamilton (Vice Chairman) will testify. Location: Room 2118, Rayburn Building.

3:00 PM. The House Armed Services Committee (HASC) will hold a hearing on the report of the National Commission on Terrorist Attacks Upon the United States, which is also known as the 9-11 Commission. Paul Wolfowitz and others will testify. Location: Room 2118, Rayburn Building.

Deadline to submit reply comments to the Federal Communications Commission (FCC) in response to its further notice of proposed rulemaking (FNPRM) regarding Aviation Radio Service. This FNPRM is FCC 03-238 in WT Docket No. 01-289. See, notice in the Federal Register, April 12, 2004, Vol. 69, No. 70, at Pages 19140 - 19147.

Deadline to submit comments to the Federal Communications Commission (FCC) regarding reserve prices, minimum opening bids, and other auction procedures for the FCC's broadband PCS spectrum auction (Auction No. 58), which is scheduled to commence on January 12, 2005. See, FCC Public Notice [PDF] (DA 04-2451).

Wednesday, August 11

9:00 AM The House Armed Services Committee (HASC) will hold a hearing on the report of the National Commission on Terrorist Attacks Upon the United States, which is also known as the 9-11 Commission. Stephen Cambone (Under Secretary of Defense for Intelligence) and others will testify. Location: Room 2118, Rayburn Building.

2:00 PM The House Armed Services Committee (HASC) will hold a hearing on the report of the National Commission on Terrorist Attacks Upon the United States, which is also known as the 9-11 Commission. Location: Room 2118, Rayburn Building.

Thursday, August 12

Deadline to submit comments to the Library of Congress in response to its notice of proposed rulemaking (NPRM) regarding amendments its regulations to provide for the reporting of uses of sound recordings performed by means of digital audio transmissions pursuant to statutory license for the period October 28, 1998, through March 31, 2004. See, notice in the Federal Register, July 13, 2004, Vol. 69, No. 133, at Pages 42007 - 42010.

Monday, August 16

9:30 AM. The Senate Governmental Affairs Committee will hold a hearing titled "Reorganizing America's Intelligence Community: A View from the Inside". Location: Room 342, Dirksen Building.

Deadline to submit comments to the Federal Communications Commission's (FCC) Consumer and Governmental Affairs Bureau regarding informal complaints submitted to the FCC regarding slamming, or the unauthorized change of a subscriber's selection of telephone exchange or telephone toll service. See, FCC notice [PDF], and notice in the Federal Register, August 4, 2004, Vol. 69, No. 149, at Pages 47152 - 47153.

Deadline to submit reply comments to the Federal Communications Commission (FCC) regarding reserve prices, minimum opening bids, and other auction procedures for the FCC's broadband PCS spectrum auction (Auction No. 58), which is scheduled to commence on January 12, 2005. See, FCC Public Notice [PDF] (DA 04-2451).

Tuesday, August 17

1:30 - 4:00 PM. The Federal Communications Commission's (FCC) WRC 07 Advisory Committee, Informal Working Group 1: Terrestrial and Space Science Services, will meet. See, notice [PDF]. Location: FCC, 445 12th Street, SW, 8th Floor, Room 8-B411 (Conference Room #5).

6:00 - 8:15 PM. The DC Bar Association's Intellectual Property Law Section and Computer and Telecommunications Law Section will host a continuing legal education (CLE) program titled "Introduction to Anti-Spam Laws". The speakers will be Jason Levine (Covington & Burling) and Samuel Kaplan (Department of Justice). Prices vary. See, notice. For more information, contact 202-626-3488. Location: D.C. Bar Conference Center, B-1 Level, 1250 H Street, NW.

More News

8/9. The Federal Communications Commission (FCC) announced that it denied two complaints against broadcast television licensees alleging violation of the FCC's indecency rules. One complaint pertained to an episode of a television program titled "Buffy the Vampire Slayer". This Memorandum Opinion and Order (MOO) [PDF] is FCC 04-196. See, FCC release [PDF]. The other complaint pertained to an episode of a television program titled "Will & Grace". This MOO [4 pages in PDF] is FCC 04-197. See, FCC release [PDF].

8/9. The Federal Communications Commission (FCC) published a notice in the Federal Register announcing, and setting the effect date for, its final rule regarding two matters -- first, spectrum sharing among non-geostationary satellite orbit mobile satellite service systems in the 1610-1626.5 MHz (L-band) and 2483.5-2500 MHz (S-band), and second, allocation of spectrum below 3 GHz for mobile and fixed services to support the introduction of new advanced wireless services, including third generation (3G) wireless systems. The FCC adopted its Report and Order and Fourth Report and Order on June 10, 2004, and released it on July 16, 2004. This item is FCC 04-134 in IB Docket No. 02-364 and ET Docket No. 00-258. The effective date is September 8, 2004. See, Federal Register, August 9, 2004, Vol. 69, No. 152, at Pages 48157 - 48162. The FCC also published a separate notice in the Federal Register that describes and sets comment deadlines for comments on its further notice of proposed rulemaking (FNPRM) to determine whether mobile satellite service (MSS) operators using different technologies could share additional spectrum in the L-band. This item is also FCC 04-134. Comments are due by September 8, 2004, and reply comments are due by September 23, 2004. See, Federal Register, August 9, 2004, Vol. 69, No. 152, at Pages 48192 - 48194.

8/10. The Federal Communications Commission (FCC) published a notice in the Federal Register describing and setting comments deadlines for the FCC's notice of proposed rulemaking (NPRM) regarding amendments to FCC rules to permit VHF public coast (VPC) and automated maritime telecommunications system (AMTS) licensees to provide private mobile radio service to units on land. Written comments are due on or before October 12, 2004, and reply comments are due on or before November 8, 2004. The FCC adopted this item on July 8, 2004, and released it on July 30, 2004. It is FCC 04-171 in WT Docket No. 04-257 and RM-10743. See, Federal Register, August 10, 2004, Vol. 69, No. 153, at Pages 48440 - 48443.

8/9. The Federal Communications Commission (FCC) published a notice in the Federal Register that describes and sets comment deadlines for its notice of proposed rulemaking (NPRM) regarding  its proposal to eliminate paper filings and require applicants to file electronically filings related to international telecommunications services. Comments are due on or before October 8, 2004, and reply comments are due on or before November 8, 2004. This NPRM is FCC 04-133 in IB Docket No.04-226. The FCC adopted this item on June 10, 2004 and released it on June 30, 2004. See, Federal Register, August 9, 2004, Vol. 69, No. 152, at Pages 48188 - 48192.

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