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February 4, 2005, 9:00 AM ET, Alert No. 1,070.
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FCC Announces Agenda for February 10 Event

2/3. The Federal Communications Commission (FCC) announced the agenda [PDF] for its Thursday, February 10, 2005 event titled "Open Meeting". Two items on the agenda may generate considerable interest: dual must carry and intercarrier compensation. The FCC scheduled these two items as the first and last items on a long nine item agenda.

First, the FCC will consider a Second Report and Order (R&O) and First Order on Reconsideration concerning the carriage obligations of cable operators with respect to digital broadcasters. This item may address the must carry and multicasting requirements of cable operators. This is CS Docket No. 98-120.

The final item on the agenda is a R&O and Further Notice of Proposed Rulemaking (FNPRM) in CC Docket No. 01-92. This is the FCC's four year old proceeding on intercarrier compensation. The agenda is vague. It states that this item "resolves a number of issues regarding application of the Commission’s intercarrier compensation rules and solicits comment on a number of reform proposals submitted by the industry as well as other issues related to intercarrier compensation reform."

The agenda item also references the "Sprint Petition for Declaratory Ruling Regarding Obligation of Incumbent LECs to Load Numbering Resources and Honor Routing and Rating Points", and the "T-Mobile et al. Petition for Declaratory Ruling Regarding Incumbent LEC Wireless Termination Tariffs".

There are also seven other items on the agenda. The FCC will consider a Second Order on Reconsideration regarding petitions for reconsideration filed regarding the national do not call registry and other Telephone Consumer Protection Act (TCPA) rules. This is CG Docket No. 02-278.

The FCC will consider a R&O and FNPRM regarding the mandatory exchange of customer account information among all local and interexchange carriers. This is CG Docket No. 02-386.

The FCC will consider a R&O regarding the FCC's policies governing the federally tariffed charges of ILECs for changing the presubscribed interexchange carrier for end user subscribers (PIC change charges). This is CC Docket No. 02-53.

The FCC will consider a Memorandum Opinion and Order (MO&O) concerning an Application for Review filed by various licensee subsidiaries of Sinclair Broadcast Group, Inc. seeking review of a decision by the FCC's Media Bureau dismissing applications through which Sinclair sought to acquire television stations from the licensee subsidiaries of Cunningham Broadcasting Corporation.

The FCC will consider a MO&O and Second Order on Reconsideration regarding the rules that permit the addition of ancillary terrestrial components (ATC) to the provision of Mobile Satellite Service (MSS) communications. This is IB Docket No. 01-185.

The FCC will consider a NPRM regarding the use of white space in the 900 MHz Business and Industrial Land Transportation Pool.

The FCC's Wireless Broadband Access Task Force will present a report on its findings and recommendations regarding the FCC's wireless broadband policies. This is GN Docket No. 04-163.

This event is scheduled for 9:30 AM on Thursday, February 14, 2005 in the Commission Meeting Room, Room TW-C305, 445 12th Street, SW. The event will be webcast by the FCC. The FCC does not always take up all of the items on its agenda. The FCC does not always start its monthly meetings at the scheduled time.

Sen. Baucus Discusses Trade with China, Technology, IPR, FTAs, R&D and Education

2/3. Sen. Max Baucus (D-MT) gave a speech [6 pages in PDF] titled "The U.S.-China Relationship in 2005: Priorities and Predictions". He advocated the benefits of a prosperous China, and U.S. trade with China. However, he said that the U.S. must press China on enforcing intellectual property rights and adhering to World Trade Organization (WTO) obligations.

However, it was a wide ranging speech. He also addressed other topics, including trade agreements, extending TAA to computer programmers and other service workers, research and development spending, education, and immigration policy.

He began by stating that "We can begin by reinforcing and even replicating successful channels of communication like the U.S.-China Joint Commission on Commerce and Trade. As you no doubt recall, last year’s JCCT meeting was critical in resolving a difficult issue involving China’s proposed wireless encryption standard."

"We should also reinforce our efforts to ensure China’s compliance with all of its WTO commitments. On trading and distribution rights, on transparency, and above all on intellectual property – we should not be hesitant to enforce our rights."

Sen. Max BaucusSen. Baucus (at left) said that "real action is necessary on intellectual property rights enforcement. China must follow up its legislative changes increasing penalties for counterfeiters with genuine and aggressive enforcement on its borders, in illegal factories, and in the infamous and abundant markets. Businesses operating in China point out continued – and often egregious -- cases of piracy and counterfeiting. Nothing is safe from this theft, be it software, optical media ..."

He added that "we may have reached a tipping point on this issue", not just because of concerns raised from outside of China, but also because "The drumbeat for stronger IP rights is increasing within China, too, as more and more innovative Chinese companies seek to protect their investments."

And, he said that "timely compliance with China's WTO commitments is critical. Considerable problems remain not only in enforcement of intellectual property rights, but also in the areas of transparency, telecommunications, services, and taxation."

He also discussed trade with other Asian nations. He said that "we should reengage Asia", and this should include negotiating free trade agreements (FTA) with Malaysia, Japan and Korea, as well as negotiating an APEC wide FTA.

Sen. Baucus is the ranking Democrat on the Senate Finance Committee, which has jurisdiction over trade issues.

He then said that with increased competition and trade, the U.S. should focus on the education and retraining of workers. He discussed Trade Adjustment Assistance (TAA). "Service industries like computer programming or calling centers also face competition from China and elsewhere, but service workers are not eligible for TAA. With over 80 percent of the U.S. economy comprised of service sector industries, I believe it is only a matter of time before we re-write TAA to add benefits for service workers."

He also said that the federal government should spend more on research and development. "Multibillion dollar industries have sprung from federal research and development dollars -- fiber optics, radar, wireless communication, nanotechnology, ultrasound and even the internet were all made possible with public sector funding."

Sen. Baucus lamented that "federal investment in the physical sciences and engineering, as a percentage of GDP, has actually declined by nearly one-third over the last two decades. We should reverse this trend." He did not, however, address the research and development tax credit in the prepared text of his speech.

He also addressed education. He said that the U.S. must spend more on "basic education" and "adopt policies to promote the training of more scientists and engineers".

FCC Order Allows SBC to Obtain Numbers from NANPA for IP Enabled Services

2/1. The Federal Communications Commission (FCC) released an order [pages in PDF] that grants to SBC Internet Services (SBCIS) "permission to obtain numbering resources directly from the North American Numbering Plan Administrator (NANPA) and/or the Pooling Administrator (PA) for use in deploying IP-enabled services, including Voice over Internet Protocol (VoIP) services, on a commercial basis to residential and business customers".

This order waives Section 52.15(g)(2)(i) of the FCC's rules. This proceeding is titled "In the Matter of Administration of the North American Numbering Plan". This order is FCC 05-20 in CC Docket 99-200

FCC Commissioner Kathleen Abernathy wrote in a separate statement [PDF] that she supports this order, but "would have preferred, however, to grant such access by adopting a rule of general applicability, rather than by waiver. All of the arguments that justify allowing SBCIP to obtain numbers directly appear to apply with equal force to many other IP providers, suggesting that this decision will trigger a series of ``me too´´ waiver petitions."

Kathleen AbernathyAbernathy (at right) added that "proceeding by rulemaking would have better enabled the Commission to address potential concerns associated with the direct allocation of numbers to IP providers. Particularly where, as here, the Commission already has sought public comment in a Notice of Proposed Rulemaking, I support adhering to the notice-and-comment rulemaking process established by the APA, rather than developing important policies through an ad hoc waiver process."

FCC Commissioner Michael Copps wrote in a concurring statement [PDF] that "numbers are a scarce public good", and that "numbering conservation is not an issue that the federal government can undertake by itself. States have an integral role to play."

He also wrote that "our approach today neglects the need for broader reform that could accommodate other IP service providers. It puts this off for another day, preferring instead to address what may soon be a stream of wavier petitions on this subject."

FCC Commissioner Jonathan Adelstein wrote in a separate statement [PDF] that "these issues would be more appropriately addressed in the context of the Commission’s IP-Enabled Services rulemaking."

The FCC has an open proceeding regarding IP enabled services generally. It is intended to address issues such as compensation, the Universal Service Fund, 911/E911, consumer protection, and disability access requirements. The FCC adopted its IP enabled services Notice of Proposed Rulemaking (NPRM) [97 pages in PDF] on February 12, 2004, and released it on March 10, 2004. It is FCC 04-28 in WC Docket 04-36.

The FCC briefly raised this issue in its 97 page NPRM. It wrote, in sentence four, of paragraph 76, that "we seek comment whether any action relating to numbering resources is desirable to facilitate or at least not impede the growth of IP-enabled services, while at the same time continuing to maximize the use and life of numbering resources in the North American Numbering Plan." See also, footnote number 226.

EU Adopts Regulation Regarding FSC/ETI Duties

1/31. The Council of the European Union stated in a release [PDF] that "The Council adopted today a Regulation suspending additional EU customs duties on imports of certain products from the United States that it imposed in December 2003, under Regulation 2193/2003, in response to illegal subsidies granted by the US under its legislation on Foreign Sales Corporations (FSCs)."

The 108th Congress enacted, and the President signed, HR 4520, the "American Jobs Creation Act of 2004", or Jobs Act. The primary and original purpose of this bill was to repeal the extraterritorial income (ETI) tax regime, which in turn replaced the foreign sales corporation tax regime. To compensate for this, the Jobs Act also reduced the top corporate tax rate from 35% to 32%, over several years, for domestic manufacturers, producers, farmers, and small corporations. The bill also included numerous unrelated provisions.

The impetus for repealing FSC/ETI was that the World Trade Organization (WTO) ruled that the FSC/ETI tax regime constituted illegal export subsidies, and authorized the EU to impose up to $4 Billion in retaliatory tariffs. See also, story titled "EU Imposes FSC/ETI Sanctions" in TLJ Daily E-Mail Alert No. 847, March 2, 2004.

The EU added that "The new Regulation provides for suspension of the duties until 1 January 2006 or 60 days after the World Trade Organisation's Dispute Settlement Body has confirmed the incompatibility with its rules of certain aspects of the FSC successor legislation, the American Jobs Creation Act. It is aimed at encouraging the United States to comply fully with WTO rules and remove the remaining trade distortion created by subsidies granted since adoption of the FSC Act."

It also stated that "The EU considers that, although it repeals the FSC legislation, the American Jobs Creation Act adopted last year contains transitional provisions and safeguard clauses that could still be incompatible with WTO rules. The WTO's Dispute Settlement Body is due to rule later this year on the compatibility of certain aspects of the Jobs Act."

Capitol Hill News

2/3. The Senate Judiciary Committee approved S 5, the "Class Action Fairness Act of 2005" by a vote of 14-5. The full Senate is scheduled to begin consideration on Monday afternoon, February 7. For a summary of this bill, see story titled "Senate Judiciary Committee to Mark Up Class Action Fairness Act" in TLJ Daily E-Mail Alert No. 1,068, February 2, 2005.

2/2. Rep. Bob Goodlatte (R-VA), Rep. Rick Boucher (D-VA), and 60 other members of the House, introduced, HR 517, titled the "Class Action Fairness Act of 2005".

More News

2/3. The Federal Trade Commission (FTC) released a paper [90 pages in PDF] titled "Transparency at the Federal Trade Commission: The Horizontal Merger Review Process, 1996-2003". It was written by two FTC economists, Malcolm Coate and Shawn Ulrick. This paper contains data on the FTC's merger enforcement decisions, and analysis of that data, by multivariate regression analysis, and other methods. It makes several findings. "First, increases in the Herfindahl and change in Herfindahl generally make enforcement more likely, as do reductions in the number of significant competitors. Second, the industry may matter as the model predicts that enforcement is more likely in the oil, grocery, and chemical industries. Third, the models show no structural shifts during the eight year period examined here; that is neither political control of the Federal Trade Commission nor the merger wave is statistically related to the enforcement outcome." See also, FTC release. See also, the Department of Justice (DOJ) Antitrust Division's web page titled "The Herfindahl-Hirschman Index".

2/3. Neelie Kroes, the European Competition Commissioner, gave a speech in Brussels, Belgium titled "Effective Competition Policy -- a Key Tool for Delivering the Lisbon Strategy".

2/2. The U.S. Court of Appeals (9thCir) issued its opinion [36 pages in PDF] in In Re Daou Systems, class action securities litigation against a public traded company that provided computer networking systems for use in the healthcare sector, and several of its officers and directors. The plaintiffs alleged violation of Section 10b Exchange Act of 1934 for alleged accounting fraud. The District Court dismissed the complaint for failure to satisfy the heightened pleading requirements of the Private Securities Litigation Reform Act (PSLRA). The Court of Appeals reversed and remanded. This case In Re Daou Systems, Inc. Securities Litigation, App. Ct. Nos. 02-56989 and 02-57018, appeals from the U.S. District Court for the Southern District of California, Judge James Lorenz presiding, D.C. Nos. CV-98-01537 and CV-98-01537. Judge Melvin Brunetti wrote the opinion of the Court of Appeals, in which Judges Betty Fletcher and Harry Pregerson.

2/4. The Federal Communications Commission (FCC) announced that "FCC website documents and E-Filing systems will be unavailable from 10:00 PM (EST) on Saturday February 5 until 8:00 AM (EST) on Sunday February 6 due to scheduled maintenance."

2/3. Federal Communications Commission (FCC) Commissioners Michael Copps and Jonathan Adelstein announced that Copps will replace Adelstein on the Federal-State Joint Board on Universal Service. They also said in their joint statement [PDF] that "universal service is critically important to this agency's mission."

People and Appointments

Alberto Gonzales2/3. The Senate confirmed Alberto Gonzales (at right) to be Attorney General by a vote of 60-36. See, Roll Call No. 3. Vice President Dick Cheney administered the oath of office later in the day. Gonzales will begin work at the Department of Justice (DOJ) on Friday, February 4.

Washington Tech Calendar
New items are highlighted in red.
Friday, February 4

The House will not meet.

The Senate will not meet.

The Supreme Court is in recess until February 22, 2005.

10:15 AM. Attorney General Alberto Gonzales will greet and speak to Department of Justice (DOJ) employees. The DOJ notice states that there will be "Pool camera and print reporter access" and "Media Arrival by 9:30 A.M. EST". Location: DOJ, 950 Pennsylvania Ave., NW.

9:30 AM - 1:30 PM. The WRC-07 Advisory Committee's Informal Working Group 4: Broadcasting and Amateur Issues will meet. See, FCC notice [PDF]. Location: Shaw Pittman, 2300 N St., NW, Room 1B.

Monday, February 7

The House will not meet.

The Senate will meet at 2:00 PM. It will begin consideration of S 5, the "Class Action Fairness Act of 2005".

9:30 AM. The U.S. Court of Appeals (DC) will hear oral argument in National Science and Technology Network, Inc. v. FCC, No. 03-1376. Judges Ginsburg, Henderson and Randolph will preside. This is an appeal of the FCC's cancellation of nine licenses to operate private land mobile radio stations in the Los Angeles, California area. See, FCC's brief [25 pages in PDF]. Oral argument is limited to 10 minutes per side. Location: Prettyman Courthouse, 333 Constitution Ave., NW.

12:00 NOON. The Cato Institute and the Discovery Institute will host a luncheon and panel discussion titled "The Telecom Act Nine Years Later: Why Reform Can't Wait". The speakers will be George Gilder (Discovery), Adam Thierer (Cato), John Wohlstetter (Discovery), and John Drescher (Discovery). Gilder is the author of Telecosm: The World After Bandwidth Abundance [Amazon]. Lunch will be served. The event is free. See, notice and registration page. Location: Room B-338, Rayburn Building, Capitol Hill.

6:00 PM. The Senate Committee on Homeland Security and Government Affairs will hold a business meeting to consider the nomination of Michael Chertoff to be Secretary of Homeland Security. Location: Room S-207, Capitol Building.

Deadline to submit comments to the National Science Foundation (NSF) regarding its notice of proposed rulemaking (NPRM) regarding amending the NSF patents regulation to require grantees to use an electronic reporting and management system for inventions made with NSF assistance. See, notice in the Federal Register, December 9, 2004, Vol. 69, No. 236, at Pages 71395 - 71396.

Deadline to submit comments to the National Institute of Standards and Technology (NIST) regarding its draft of SP 800-76. This is Special Publication 800-76, Biometric Data Specification for Personal Identity Verification [PDF]. Send comments and questions to

Tuesday, February 8

The House will meet at 2:00 PM.

9:30 AM - 12:30 PM. The Federal Communications Commission's (FCC) Media Bureau will host an event titled "Low Power FM Forum". Press contact: Rebecca Fisher at 202 418-2359. Location: FCC, Commission Meeting Room, 445 12th St., SW.

10:00 AM. The Senate Banking Committee will hold a hearing on the role of credit rating agencies in capital markets. Location: Room 538, Dirksen Building.

10:00 AM. The House Ways and Means Committee will hold a hearing on President Bush's Fiscal Year 2006 budget. Secretary of the Treasury John Snow will testify. Location: Room 1100, Longworth Building.

2:00 PM. The House Ways and Means Committee will hold a hearing on President Bush's Fiscal Year 2006 budget. Office of Management and Budget (OMB) Director Joshua Bolten will testify. Location: Room 1100, Longworth Building.

2:00 - 6:00 PM. The Federal Communications Bar Association's (FCBA) will host a continuing legal education (CLE) seminar titled "Communications Law 101". Prices ranges from $125 to $275. See, registration form [PDF]. The deadline to register is February 2. Location: Wiley Rein & Fielding, 1776 K St., NW.

2:15 PM. The Senate Finance Committee will hold a hearing on President Bush's Fiscal Year 2006 budget. Secretary of the Treasury John Snow will testify. Location: Room 215, Dirksen Building.

6:00 - 8:00 PM. The Advisory Committee for the Congressional Internet Caucus (ACCIC) will host a pre-conference reception. On February 9, the ACCIC will host an event titled "State of the Net Conference". Conference non-attendees RSVP to or 202 638-4370. Location: Thorton Room, Hyatt Regency on Capitol Hill, 400 New Jersey Ave., NW.

6:30 PM. The Federal Communications Bar Association's (FCBA) Young Lawyers Committee will host an event titled "Happy Hour". Location: Porter's, 1207 19th St. NW.

Deadline to submit reply comments to the Federal Communications Commission's (FCC) in response to the further notice of proposed rulemaking (FNPRM) portion of its Report and Order and FNPRM regarding the former ITFS, MDS, and MMDS, now named the Broadband Radio Service (BRS) and the Educational Broadband Service (EBS), in the 2496-2690 MHz band. The FCC adopted this item at its June 10, 2004 meeting. The FCC released the text on July 29, 2004 (FCC 04-135), and then released a modified item on October 29, 2004 (FCC 04-258). This is WT Docket 03-66. See, notice in the Federal Register, December 10, 2004, Vol. 69, No. 237, at Pages 72019 - 72047. See also, story titled "FCC Adopts RO & NPRM Re ITFS/MDS Band" in TLJ Daily E-Mail Alert No. 916, June 11, 2004.

Wednesday, February 9

7:30 AM - 4:30 PM. The Advisory Committee for the Congressional Internet Caucus will host an event titled "State of the Net Conference". The speakers will include Sen. Ted Stevens (R-AK). Registration is required. Prices range from free to $350. For more information, contact Danielle Yates at or 202 638-4370. See, notice and brochure [PDF]. Location: Hyatt Regency on Capitol Hill, 400 New Jersey Ave., NW.

10:00 AM. The House Commerce Committee's Subcommittee on Telecommunications and the Internet will hold a hearing titled "How Internet Protocol-Enabled Services are Changing the Face of Communications: A View from Technology Companies". The hearing will be webcast by the Committee. Press contact: Larry Neal or Jon Tripp at 202 225-5735. See, notice. Location: Room 2123, Rayburn Building.

12:00 NOON - 1:30 PM. The DC Bar Association will host a brown bag lunch titled "When Bad Things Happen To Good Computers". The topics will be security threats, both technology based and human, for law offices' computers, computer networks, PDAs and cell phones, and potential liabilities for failure to protect the confidential information. The speakers will be Don Philmlee (Potomac Consulting Group) and Todd Haley (Spriggs & Hollingsworth). See, notice. Prices vary from $15 to $25. For more information, call 202 626-3463. Location: D.C. Bar Conference Center, B-1 Level, 1250 H St., NW.

5:00 - 7:00 PM. The Advisory Committee for the Congressional Internet Caucus will host a technology fair and reception. The exhibitors will be ComCare Alliance, Consumer Electronics Association, eBay, Entertainment Software Association, Ericsson, Federal Trade Commission, Freedom Calls Foundation, Fujitsu, GetNetWise, i-Safe & VeriSign, Kodak, Microsoft, NetSmartz Workshop, NTT DoCoMo USA, NTT/Verio, PivX, Pulver, Qualcomm, RSA Security & i-Mature, SAP, SBC, Sony Connect, SunRocket, Symantec, Symbol, TRUSTe, Verizon Wireless, Visa USA, and Vonage. Location: Room SDG-50, Dirksen Building.

Thursday, February 10

9:30 AM. The Federal Communications Commission (FCC) will hold a meeting. The event will be webcast by the FCC. Location: FCC, 445 12th Street, SW, Room TW-C05 (Commission Meeting Room).

? 9:30 AM. The Senate Judiciary Committee may hold an executive business meeting. Press contact: Blain Rethmeier (Specter) at 202 224-5225 or Tracy Schmaler (Leahy) at 202 224-2154. Location: Room 226, Dirksen Building.

10:00 AM - 12:00 NOON. The WRC-07 Advisory Committee's Informal Working Group 5: Regulatory Issues will meet. See, FCC notice [PDF]. Location: The Boeing Company, 1200 Wilson Blvd., Arlington, VA.

12:15 PM. The Federal Communications Bar Association's (FCBA) Cable Practice Committee will host a brown bag lunch. The speakers will be Lisa Sutherland (Chief of Staff, Senate Commerce Committee), Christine Kurth (Deputy Chief of Staff, Senate Commerce Committee), and James Assey (Minority Counsel, Senate Commerce Committee). For more information, contact Catherine Bohigian at Location: Mintz Levin, 701 Pennsylvania Ave., NW.

12:30 - 1:30 PM. The DC Bar Association will host a program titled "Trade Secrets Damages: What Can a Successful Claimant Expect to Recover?". The speaker will be Carla Mulhern (Analysis Group, Inc.). See, notice. Prices vary from $10 to $30. For more information, call 202 626-3463. Location: D.C. Bar Conference Center, B-1 Level, 1250 H St., NW.

Deadline to submit comments to the U.S. Patent and Trademark Office (USPTO) regarding revisions to the rules of practice in patent cases to implement the Cooperative Research and Technology Enhancement Act of 2004 (CREATE Act). See, notice in the Federal Register, January 11, 2005, Vol. 70, No. 7, at Pages 1818-1824. This bill was S 2192 in the 108th Congress. President Bush signed it on December 10, 2004. See, story titled "President Signs CREATE Act" in TLJ Daily E-Mail Alert No. 1,037, December 14, 2004.

Friday, February 11

TIME? The Judicial Conference of the United States (JC) will hold a public hearing on its proposed amendment to Civil Rule 5 regarding electronic filings. The JC has proposed amendments to Civil Rule 5, Appellate Rule 25, and Bankruptcy Rule 5005. Each of these proposed amendments would permit the applicable court, by local rules, to "permit or require papers to be filed, signed, or verified by electronic means" (or similar language). Current rules provide that the applicable court may "permit" filing by electronic means. See, JC notice [PDF] and notice in the Federal Register, Federal Register, December 2, 2004, Vol. 69, No. 231, at Page 70156. Location: undisclosed.

5:00 PM. Deadline to submit comments to the Office of the U.S. Trade Representative (USTR) regarding countries that deny adequate and effective protection of intellectual property rights or deny fair and equitable market access to U.S. persons who rely on intellectual property protection. This is for the USTR's Special 301 review, pursuant to 19 U.S.C. § 2242. See, notice in the Federal Register, January 3, 2005, Vol. 70, No. 1, at Page 134.

Deadline to register for the Federal Communications Bar Association's (FCBA) lunch, featuring Mel Karmazin, CEO of Sirius Satellite Radio. See, registration form [MS Word].

Deadline to submit comments to the National Institute of Standards and Technology (NIST) regarding its final public draft of SP 800-53. This is "Special Publication 800-53 (Final Public Draft), Recommended Security Controls for Federal Information Systems". Send comments to

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