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October 19, 2004, 9:00 AM ET, Alert No. 999.
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District Court Modifies 2000 Judgment to Allow Cingular to Acquire Certain AT&T Wireless Licenses

10/13. The U.S. District Court (DC) issued its Memorandum Opinion and Order [6 pages in PDF] in USA v. SBC and BellSouth, modifying the final judgment issued in 2000 that required Cingular Wireless to divest certain spectrum licenses. This allows Cingular to acquire certain spectrum licenses of AT&T Wireless.

This case arose following the formation of Cingular Wireless, a joint venture of SBC Communications and Bellsouth Corporation. The U.S. filed a complaint in the District Court alleging that this joint venture would result in undue concentration of market share in markets for wireless telephone service in the states of California, Indiana, and Louisiana. The parties consented to entry of a judgment that required divestiture of certain spectrum licenses in those states. The judgment also barred Cingular from reacquiring the licenses.

AT&T Wireless subsequently acquired some of the divested licenses.

In February of 2004, Cingular agreed to acquire AT&T Wireless. In July it moved for a modification of the final judgment to enable it to acquire these licenses.

The District Court, following a Tunney Act review, concluded that allowing the modification of the final judgment is in the public interest, and modified the final judgment. It found that the competitive conditions for wireless mobile telephone services has changed in the relevant markets. More competitors have entered.

See also, Modified Final Judgment [26 pages in PDF] and Order to Modify Final Judgment [6 pages in PDF].

This case is United States of America v. SBC Communications, Inc. and BellSouth Corporation, D.C. No. 00-2073 (PLF), Judge Paul Friedman presiding.

Berman and Boucher Introduce Bill to Provide for Post Grants Reviews of Patents

10/8. Rep. Howard Berman (D-CA) and Rep. Rick Boucher (D-VA) introduced HR 5299, the "Patent Quality Assistance Act of 2004", a bill to amend the Patent Act to provide for post grant reviews.

The bill would add to Title 35 a new Chapter 32, titled "Post-Grant Opposition Procedures".

Rep. Howard BermanRep. Berman (at right) stated that this bill "contains a number of provisions designed to improve patent quality, deter abusive practices by unscrupulous patent holders, and provide meaningful, low-cost alternatives to litigation for challenging the patent validity."

He continued that "I am a strong believer that the prospect of patent protection promotes innovation. However, I also believe that the patent system is strongest, and incentives for innovation greatest, when patents protect only truly deserving inventions. When functioning properly, the patent system should encourage and enable inventors to push the boundaries of knowledge and possibility.  If the patent system allows questionable patents to issue and does not provide adequate safeguards against patent abuses, the system may stifle innovation and interfere with competitive market forces."

He added that "we introduce this bill at the end of this Congress with the intent of framing the debate going into the 109th Congress, and with every intention of passing legislation in the next two years."

This bill provides that "A person may request that the grant or reissue of a patent be reconsidered by the Patent and Trademark Office by filing an opposition seeking to invalidate 1 or more claims in the patent." This would be a public proceeding, with the contents of the file open to public inspection. However, the bill also provides that "if requested by the opposer, the identity of a real party in interest shall be kept separate from the file ..." This procedure would not be available "if the opposer relies upon factual evidence or expert opinions ... or if the opposer exercises the right to appeal ..."

An opposition request must be made within nine months of the grant (or issuance of a reissue patent), or six months after receiving notice from the patent holder alleging infringement of the patent, unless the patent holder otherwise consents in writing.

The bill further provides that the Director of the U.S. Patent and Trademark Office (USPTO) "may dismiss an opposition request that the Director determines lacks substantial merit." However, such a "dismissal of an opposition request shall not be admissible in any civil action related to the patent against which a dismissed request was filed."

The bill provides that "The Director shall assign the opposition proceeding to a panel of three administrative patent judges ... The panel shall decide the questions of patentability raised in each opposition request for which an opposition proceeding has been instituted. The decision shall be based upon the prosecution record that was the basis for the grant of the patent and the additional submissions by the parties to the opposition proceeding authorized under this chapter."

The bill provides that the patent owner may file responses to opposition requests, and may request amendment of any claims that are the subject of an opposition request. It further provides for limited discovery, hearings, briefs, and written decisions.

And, "The opposer in an opposition proceeding under this chapter shall have the burden to prove the invalidity of a claim by a preponderance of the evidence. The determination of invalidity shall be based upon the broadest reasonable construction of the claim."

Appeals of final determinations of the panel in an opposition proceeding would be made to the U.S. Court of Appeals for the Federal Circuit.

Then, "the determination with respect to an issue of invalidity raised by an opposer shall bar that opposer from raising, in any subsequent proceeding involving that opposer under this title, any issue of fact or law actually decided and necessary to the determination of that issue." But, the bill provides one exception. "If an opposer in an opposition proceeding demonstrates ... that there is additional factual evidence that is material to an issue of fact actually decided in the opposition proceeding, and necessary to the final determination in the opposition proceeding, that could not reasonably have been discovered or presented in the opposition proceeding by that opposer, the opposer may raise, in that subsequent proceeding, that issue of fact and any determined issue of law for which the issue of fact was necessary."

Rep. Berman is the ranking Democrat on the House Judiciary Committee's Courts, the Internet and Intellectual Property Subcommittee (CIIP). Rep. Boucher is the second most senior Democrat on the CIIP Subcommittee. Both were first elected at the same time. Rep. Berman has seniority because his name precedes Rep. Boucher's in alphabetical ordering.

On June 24, 2004, the CIIP Subcommittee held a hearing titled "Patent Quality Improvement: Post-Grant Opposition". See, prepared testimony [6 pages in PDF] of James Toupin (General Counsel of the U.S. Patent and Trademark Office), prepared testimony [PDF] of Jeffrey Kushan (outside counsel for Genentech), prepared testimony of Michael Kirk (Executive Director of the American Intellectual Property Law Association), and prepared testimony [PDF] of Karl Sun (Google).

The Federal Trade Commission (FTC) recommended in its October 2003 report titled "To Promote Innovation: The Proper Balance of Competition and Patent Law and Policy" that the Congress create "an administrative procedure for post-grant review and opposition that allows for meaningful challenges to patent validity short of federal court litigation. To be meaningful, the post-grant review should be allowed to address important patentability issues. The review petitioner should be required to make a suitable threshold showing." See, Executive Summary [18 pages in PDF] and Report [2.28 MB in PDF]. See, story titled "FTC Releases Report on Competition and Patent Law" in TLJ Daily E-Mail Alert No. 768, October 29, 2003.

The American Intellectual Property Law Association (AIPLA) hosted a panel discussion on Friday, October 15, 2004, as a part of its annual convention, that included a discussion of this proposal. There was wide agreement that a post-grant opposition process is necessary. However, there was disagreement over the details.

FCC Releases Fiber to the Curb Order

10/18. The Federal Communications Commission (FCC) released the text [28 pages in PDF] of its Order on Reconsideration that relieves incumbents LECs from Section 251 unbundling requirements for fiber to the curb (FTTC) loops, where fiber is extended within 500 feet of a customer's premises.

This Order states that "we conclude that the record here demonstrates that the same unbundling relief as provided for FTTH loops in the Triennial Review Order and MDU Reconsideration Order is warranted for FTTC loops provided certain architectural requirements are met as discussed below.28 In arriving at this conclusion, we are persuaded that making such a change in our rules is necessary to ensure that regulatory disincentives for broadband deployment are removed for carriers seeking to provide advanced services to mass market customers using FTTC technology."

The order defines FTTC loops as "a fiber transmission facility connecting to copper distribution plant that is not more than 500 feet from the customer’s premise". The order further specifies that "the fiber transmission facility in a FTTC loop must connect to copper distribution plant at a serving area interface from which every other copper distribution subloop also is not more than 500 feet from the respective customer’s premise."

This order states that "when fiber is brought within 500 feet of a subscriber's premise, carriers can provide broadband services comparable to that provided by FTTH architecture, including data speeds of 10 megabits per second (Mbps) in addition to high definition multi-channel video services."

The FCC order offers this rationale. "First, we conclude that requesting carriers are not impaired in greenfield areas and face only limited impairment without access to FTTC loops where FTTC loops replace pre-existing loops. Second, as with FTTH loops, competitive LECs deploying FTTC loops have increased revenue opportunities through the ability to offer voice, multi-channel video, and high-speed data services." (Footnotes removed from quotations.)

The FCC adopted this item at its October 14, 2004 meeting. See, story titled "FCC Rules ILECs Have No § 251 Unbundling Obligations for FTTC" in TLJ Daily E-Mail Alert No. 997, October 15, 2004. This item is FCC 04-248 in CC Docket No. 01-338, CC Docket No. 96-98, and CC Docket No. 98-147.

2nd Circuit Reverses Injunction In WorldCom Multidistrict Securities Litigation

10/18. The U.S. Court of Appeals (2ndCir) issued its opinion [21 pages in PDF] in Retirement Systems of Alabama v. J.P. Morgan Chase & Co., reversing the judgment of the U.S. District Court (SDNY), which is the venue for the multidistrict securities litigation arising from the collapse of WorldCom, enjoining respondents from pursuing a related action in the Alabama Circuit Court for Montgomery County.

The respondents are not plaintiffs in the action in the U.S. District Court. The District Court concluded that a trial date of October 18, 2004 in the Alabama action would disrupt the District Court trial date of January 10, 2005, and that an injunction postponing the Alabama action was therefore "necessary in aid of its jurisdiction."

The Court of Appeals reversed and remanded. It held that the District Court’s injunction was barred by the Anti-Injunction Act, 28 U.S.C. § 2283, which permits a federal court to enjoin a state court proceeding only where "expressly authorized by Act of Congress, or where necessary in aid of its jurisdiction, or to protect or effectuate its judgments."

This case is Retirement Systems of Alabama v. J.P. Morgan Chase & Co., App. Ct. No. 04-2275-cv. Judge Jose Cabranes wrote the opinion for the Court of Appeals.

More News

10/18. The Progress and Freedom Foundation (PFF) released a paper [7 pages in PDF] titled "Universal Service: Is It Still Relevant?". It was written by Ray Gifford of the PFF.

10/14. The Office of the U.S. Trade Representative (USTR) released a document [69 pages in PDF] titled "Annual Reform Recommendations from the Government of the United States to the Government of Japan under the U.S.-Japan Regulatory Reform and Competition Policy Initiative". It includes recommendations regarding regulation of telecommunications and information technology, intellectual property protection, competition law and policy, and government transparency and independent regulators. See also, USTR release.

Washington Tech Calendar
New items are highlighted in red.
Tuesday, October 19

The House is in recess until November 16, 2004. See, Republican Whip Notice.

The Senate is in recess until November 16, 2004.

10:00 AM. The U.S. District Court (DC) will hold a status conference in U.S. v. Microsoft, the government antitrust case against Microsoft.. On October 8, 2004, Microsoft, the Department of Justice (DOJ), and various state plaintiffs filed a Joint Status Report on Microsoft's Compliance with the Final Judgments. This case is D.C. No. 98-1232 (CKK), Judge Colleen Kotelly presiding. Location: Courtroom 11, Prettyman Courthouse, 333 Constitution Ave., NW.

12:00 NOON. The Federal Communications Bar Association's (FCBA) Executive Committee will meet. Location: Wiley Rein & Fielding, 1776 K Street, NW.

4:00 - 5:00 PM. The U.S. Chamber of Commerce will host an event titled "Intellectual Property Roundtable featuring Attorney General John Ashcroft". AG John Ashcroft will discuss the Department of Justice's (DOJ) report [96 pages in PDF] titled "Report of the Department of Justice's Task Force on Intellectual Property". See, story titled "DOJ IP Task Force Issues Recommendations" in TLJ Daily E-Mail Alert No. 995, October 13, 2004. See, notice. Prices vary. The event will be webcast by the U.S. Chamber. Location: U.S. Chamber, 1615 H St., NW.

4:00 PM. The Federal Communications Bar Association's (FCBA) Legislative Committee will host an event titled "Afternoon Chat with Howard Waltzman". Waltzman is the Chief Counsel to the House Commerce Committee's Subcommittee on Telecommunications and the Internet. RSVP to Location: Wiley Rein & Fielding,1776 K Street, NW.

Wednesday, October 20

8:00 AM. The Federal Communications Bar Association (FCBA) will host a breakfast. The speaker will be Dan Glickman, the new head of the Motion Picture Association of America (MPAA). Location: Capitol Hilton, 16th & K Streets, NW.

9:30 - 11:00 AM. The Progressive Policy Institute (PPI) will host a panel discussion titled "Privacy vs. Security: A False Choice?". The speakers will be Paul Rosenzweig (Heritage Foundation), David Sobel (Electronic Privacy Information Center), and Robert Atkinson (Director of the PPI's Technology and New Economy Project). See, notice. Location: PPI, 600 Pennsylvania Ave., SE, Suite 400.

10:00 AM - 3:00 PM. The Department of Justice (DOJ), the Motion Picture Association of America (MPAA) and the Recording Industry Association of America (RIAA), CourTV, and other entities will host a forum for students on intellectual property theft. Attorney General John Ashcroft will speak at 11:00 AM. Deputy Attorney General James Comey will also participate. The DOJ notice states that "All event activities are open press". Location: Great Hall, DOJ, 950 Pennsylvania Ave., NW.

10:00 AM. Jeffrey Carlisle, Chief of the Federal Communications Commission's (FCC) Wireline Communications Bureau (WCB), will hold an event titled "briefing for members of the media". RSVP to Mark Wigfield at 202 418-0253. Location: FCC, 445 12th St., SW, Room TW A-402/A-442.

11:00 AM - 12:30 PM. The Cato Institute will host a panel discussion titled "The Next Big Thing in Copyright? The Induce Act and Contributory Liability". Location: Cato, 1000 Massachusetts Ave., NW.

12:15 PM. The New America Foundation (NAF) will host a brown bag lunch. The speaker will be Leo Hindery (Chairman of HL Capital and Former CEO of TCI and AT&T Broadband). RSVP to Jennifer Buntman at 202 986-4901 or Location: NAF, 1630 Connecticut Ave., NW, 7th Floor.

6:00 - 8:15 PM. The DC Bar Association's Computer and Telecommunications Law Section will host a continuing legal education (CLE) program titled "Ethics and the Internet". The speaker will be J.T. Westermeier (Piper Rudnick). See, notice. Prices vary from $80 to $115. For more information, call 202 626-3488. Location: D.C. Bar Conference Center, B-1 Level, 1250 H St., NW.

Thursday, October 21

9:30 AM. The U.S. Court of Appeals (DCCir) will hear oral argument in In Re AT&T, No. 03-1397. Judges Ginsburg, Sentelle and Randolph will preside. Location: Prettyman Courthouse, 333 Constitution Ave., NW.

12:00 NOON. The Heritage Foundation will host a panel discussion titled "Secure Flight: Screening for Terrorists on Passenger Planes". The speakers will be Justin Oberman (Transportation Security Administration), Lisa Dean (TSA), and Paul Rosenzweig (Heritage). See, notice. Location: 214 Massachusetts Ave., NE.

12:15 PM. The Federal Communications Bar Association's (FCBA) Cable Practice Committee will host a brown bag lunch. Jeffrey Carlisle, Chief of the Federal Communications Commission's (FCC) Wireline Competition Bureau will speak on "VOIP and Cable". RSVP to Frank Lloyd 202 434-7309 or Location: 9th Floor, Mintz Levin, 701 Pennsylvania Ave., NW.

4:00 PM. Michael Carrier (Rutgers University Law School) will present a paper titled "Cabining Intellectual Property Through a Property Paradigm" at an event hosted by the Dean Dinwoodey Center for Intellectual Property Studies at the George Washington University Law School (GWULS). For more information, contact Robert Brauneis at 202 994-6138 or The event is free and open to the public. See, notice. Location: GWULS, Faculty Conference Center, Burns Building, 5th Floor, 716 20th Street, NW.

5:30 - 7:30 PM. The DC Bar Association's Intellectual Property Law Section will host an event titled "Intellectual Property Law Section Fall Reception". See, notice. Prices vary from $25 - $50. For more information, call 202 626-3463. Location: The Club at Franklin Square, 1300 Eye Street, NW, Lobby Level.

6:00 - 8:00 PM. The Federal Communications Bar Association (FCBA) will host the first part of a two part continuing legal education (CLE) seminar on Homeland Security. Prices vary. See, notice. Location: FCC, Commission Meeting Room, 445 12th St., SW.

Friday, October 22

12:15 PM. The Federal Communications Bar Association's (FCBA) Young Lawyers Committee will host a brown bag lunch. Harry Martin (President of the FCBA) and Michele Farquhar (President-Elect of the FCBA) will speak on involvement in the FCBA and building a career in communications law. For more information, contact Jason Friedrich at or Pam Slipakoff at Location: Drinker Biddle & Reath, 1500 K Street NW, Suite 1100.

12:30 - 2:00 PM. The Congressional Internet Caucus Advisory Committee, the Federal Trade Commission (FTC), and the National Cyber Security Alliance (NCSA) will host a panel discussion titled "Computer Security: What Your Constituents Need to Know". The speakers will be FTC Commissioner Orson Swindle, Susan Koehler (Microsoft), Martha Lockwood, (NCSA), and Wendy Tazelaar ( Lunch will be served. Registration is required; contact or 202 638-4370. Location: Room HC-5, Capitol Building.

Monday, October 25

Day one of a five day conference hosted by the Office of the Secretary of Defense (OSD) Networks and Information Integration (NII) and the Joint Chiefs of Staff titled "7th Annual DoD Spectrum Management Conference". See, notice. Location: Radisson Hotel, Annapolis, Maryland.

Tuesday, October 26

9:30 AM. The Department of Commerce's (DOC) Bureau of Industry and Security's (BIS/BXA) Sensors and Instrumentation Technical Advisory Committee (SITAC) will hold a partially closed meeting. The agenda includes discussion of Wassenaar Export Group proposals on semiconductor lasers and cameras. See, notice in the Federal Register, October 8, 2004, Vol. 69, No.195, at Page 60352. Location: Room 3884, DOC, 14th Street between Constitution and Pennsylvania Aves., NW.

Day two of a five day conference hosted by the Office of the Secretary of Defense (OSD) Networks and Information Integration (NII) and the Joint Chiefs of Staff titled "7th Annual DoD Spectrum Management Conference". See, notice. Location: Radisson Hotel, Annapolis, Maryland.

Deadline to submit reply comments to the Library of Congress in response to its notice of proposed rulemaking (NPRM) regarding continuation, with a few modifications, of the procedures adopted by the Copyright Office in 1995 that permit copyright applicants to request reconsideration of decisions to refuse registration. See, notice in the Federal Register, July 13, 2004, Vol. 69, No. 133, at Pages 42004-42007.

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