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May 4, 2005, 9:00 AM ET, Alert No. 1,128.
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Leahy and Sununu Introduce E-Mail Privacy Act

4/28. Sen. Patrick Leahy (D-VT) and Sen. John Sununu (R-NH) introduced S 936, the "E-Mail Privacy Act of 2005".

This bill is a reaction to the split opinion of the three judge panel of the U.S. Court of Appeals (1stCir) in USA v. Bradford Councilman, a criminal case involving the Electronic Communications Privacy Act (ECPA) and unauthorized accessing of the content of stored e-mail messages. The Court of Appeals held that there was no violation of the Wiretap Act, as amended by the ECPA, when stored e-mail was accessed, because, since it was in storage, there was no interception within the meaning of the statute. See also, story titled "1st Circuit Holds Wiretap Act Does Not Apply to E-Mail in Storage" in TLJ Daily E-Mail Alert No. 930, July 1, 2004.

The Court of Appeals held a rehearing en banc on December 8, 2004. See, story titled "1st Circuit Grants Rehearing En Banc in Councilman Case" in TLJ Daily E-Mail Alert No. 992, October 7, 2004. Sen. Leahy filed an amicus curiae brief [PDF].

The Court of Appeals reasoned that whether there is a violation of 18 U.S.C. § 2511 in this case turns on the definitions found in 18 U.S.C. § 2510. That is, 18 U.S.C. § 2511(1) provides, in part, that "any person who (a) intentionally intercepts, endeavors to intercept, or procures any other person to intercept or endeavor to intercept, any wire, oral, or electronic communication ... shall be punished as provided in subsection (4) or shall be subject to suit as provided in subsection (5)." 18 U.S.C. § 2510 contains definitions of both "wire communication" and "electronic communication". The definition of "wire communication" includes "any electronic storage of such communication", while the definition of "electronic communication" makes no reference to stored communications. Thus, no interception can occur while the e-mails are in electronic storage. And, since there is no interception, there is no violation of 18 U.S.C. § 2511.

The Leahy Sununu bill amends 18 U.S.C. § 2510 to undo Councilman. The bill provides that "Section 2510(4) of title 18, United States Code, is amended by striking `through the use of any electronic, mechanical, or other device.' and inserting `contemporaneous with transit, or on an ongoing basis during transit, through the use of any electronic, mechanical, or other device or process, notwithstanding that the communication may simultaneously be in electronic storage;´"

Sen. Leahy explained his bill in the Senate. He stated that "In a strained reading of the Electronic Communications Privacy Act (ECPA), the majority in this case effectively concluded that it was permissible for an Internet Service Provider to systematically intercept, copy and read its customers' incoming e-mails for corporate gain. This outcome is an unacceptable privacy intrusion that is inconsistent with Congressional intent and the commonly-held understanding of the protections provided by ECPA, and requires swift Congressional response." See, Congressional Record, April 28, 2005, at Page S4553.

"In 1986 Congress passed ECPA to update the Wiretap Act so that Americans could enjoy the same amount of privacy in their online communications as they do in the offline world. ECPA", said Sen. Leahy. "The Councilman decision upset this careful distinction."

He added that "this decision essentially licenses ISPs to snoop. Even more worrisome is that this decision creates the opportunity for the type of Big Brother invasions that understandably make Americans cringe. For practical reasons, law enforcement often installs surveillance devices at these nanosecond storage points, but before doing so, they have obtained the appropriate legal permission to intercept e-mails -- a Title III order. Under the majority's interpretation in the Councilman decision, law enforcement would no longer need to obtain a Title III order to conduct such searches, but rather could follow the less rigorous procedures for stored communications."

The Councilman case has resulted in other legislative proposals. For example, on July 22, 2004, Rep. Jerrold Nadler (D-NY) and others introduced HR 4977 (108th Congress), the "E-mail Privacy Protection Act of 2004". This bill amends the Wiretap Act and the Stored Communications Act, to provide that accessing stored e-mail communications, including by e-mail service providers, can constitute criminal violations. See, story titled "Rep. Nadler Introduces Bill to Criminalize Accessing Stored E-Mail" in TLJ Daily E-Mail Alert No. 950, August 2, 2004.

Also on July 22, Rep. Jay Inslee (D-WA) and others introduced HR 4956 (108th Congress), the "E-mail Privacy Act of 2004". Like Rep. Nadler's bill, HR 4977, this bill responds to the opinion in USA v. Councilman, and provides increased legal protection under the Criminal Code for stored e-mail communications. However, Rep. Inslee's bill would provide less onerous limitations upon the activities of e-mail service providers. See, story titled "Rep. Inslee Introduces E-mail Privacy Act" in TLJ Daily E-Mail Alert No. 950, August 2, 2004.

Rep. Miller Introduces Bill to Repeal Excise Tax on Phones

4/27. Rep. Gary Miller (R-CA), and 39 other Representatives, introduced HR 1898, the "Telephone Excise Tax Repeal Act of 2005".

There were similar bills in the 105th, 106th, 107th, and 108th Congresses. None became law. See, HR 3648 in the 105th Congress, HR 3916 in the 106th Congress, HR 236 in the 107th Congress, and HR 2957 in the 108th Congress. The House passed HR 3916 (106th) on a roll call vote of 420-2, on May 25, 2000. See, Roll Call No. 233. However, the full Senate did not pass the bill. HR 236 (107th) had 149 sponsors.

This tax dates back to the Spanish American War. Hence, the sponsors waited until April to introduce the bill so that it would be assigned the number 1898, which is also the year in which the tax was first imposed.

"I think it is safe to say that the Spanish American War is over", said Rep. Miller in a release. He added, "like a cockroach, this tax refuses to die".

Senate Report 106-328 on HR 3916 (106th) states that "The first tax on telephone service was enacted in 1898 to help finance the Spanish-American War. That tax was repealed in 1902 and was not re-enacted until World War I required additional revenues. The World War I telephone tax was repealed in 1924 and was re-enacted in 1932. All of these initial telephone taxes applied only to toll (long distance) service. In 1941, with the advent of World War II, the tax was extended to general local service. An excise tax on telephone service has been in effect in every year since 1941, despite enactment of periodic legislation to repeal or phase-out the tax." (Parentheses in original. Footnotes omitted.)

26 U.S.C. § 4251 provides that "There is hereby imposed on amounts paid for communications services a tax equal to ... 3 percent". HR 1898 would, among other things, repeal this section.

§ 4251(b) provides that the term ''communications services'' means "(A) local telephone service; (B) toll telephone service; and (C) teletypewriter exchange service". Nevertheless, last year the Internal Revenue Service (IRS) announced that it might, by administrative fiat, expand the scope of the tax to include some internet protocol services. See story titled "IRS Publishes Advance NPRM Regarding Expanding the Excise Tax on Telephones to Include New Technologies" in TLJ Daily E-Mail Alert No. 931, July 6, 2004.

Phone companies, which do not like to have their customers singled out for a special tax, have long sought repeal of this tax. Steve Largent, P/CEO of the CTIA, stated in a release that the excise tax "is today slowing the development of innovative products and services that help make our lives more productive and enjoyable".

European Commissioner Discusses Innovation Gap

4/26. Viviane Reding, the European Commissioner for Information Society and Media, gave a speech in Brussels regarding innovation in Europe. She said that there is an innovation gap, in which Europe lags behind the U.S., and that Europe should do something about this, especially in the information and communications technology (ICT) sector.

Viviane RedingReding (at right) stated that "A significant innovation gap still exists between the US and the EU, as well as between Japan and the EU."

She said that "According to the European Innovation Scoreboard, an instrument developed to evaluate and compare the innovation performance of Member States with other countries, the US leads mainly because of more patents, a bigger working population with tertiary education, and higher R&D expenditure, in particular from private sources."

She said that "It is essential for Europe to catch up, to improve the conditions under which European companies can succeed, and to support innovation wherever possible." She added that ICT "play a key role", and are "enabling technologies" that "underpin innovation in all sectors of the economy and are responsible for around half of the productivity growth in modern economies."

She discussed Europe's lack of success in ICT. "In IT hardware, only two European companies are among the world’s top ten, and in software and computer services we have only one top ten company."

She then offered government policy solutions.

First, she said, create a "European information space ... to further develop the internal market in information goods and services in Europe, in particular through simple, flexible and market oriented regulation." She did not explain. Although, she added that the Europe should focus on several ICT sectors, "Voice over Internet, security and privacy issues, intellectual property rights, and on-line payments."

Second, she said, government should spend more on research and development (R&D). She argued that "Europe is under-investing in its future. Its ICT investments are only a third of those in the USA and only two thirds of those in Japan. Our overall target therefore is to raise European investment in R&D to 3% of GDP in all 25 EU Member States. At EU level, I would like to see the current R&D funding doubled ..."

Proponents of increased R&D funding by the U.S. similarly argue that the U.S. may fall behind Europe and Asia in a looming innovation gap. For a U.S. based view of how the U.S., Europe and Asia compare on innovation metrics, see, February 2005 report [PDF] titled "The Knowledge Economy: Is the United States Losing Its Competitive Edge?" This report is also subtitled "Benchmarks of Our Innovation Future". It concludes that "Nations from Europe to Eastern Asia are on a fast track to pass the United States in scientific excellence and technological innovation". See also, story titled "University and Industry Representatives Urge More R&D Funding" in TLJ Daily E-Mail Alert No. 1,079, February 17, 2005.

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Washington Tech Calendar
New items are highlighted in red.
Wednesday, May 4

The House will meet at 10:00 AM for legislative business. The agenda includes several non-technology related items.  See, Republican Whip Notice.

The Senate will not meet on Monday, May 2, through Friday, May 6. See, Senate calendar.

9:30 AM. The Center for American Progress (CAP) will host a panel discussion titled "No Place to Hide: Where the Data Revolution Meets Homeland Security". The speakers will be Robert Harrow (author of No Place to Hide: Behind the Scenes of Our Emerging Surveillance Society [Amazon]), Wesley Clark (former U.S. Army General), Nuala Kelly (Chief Privacy Office of the DHS), and James Dempsey (Center for Democracy and Technology). Location: CAP, 1333 H St. NW.

10:00 AM. The House Science Committee will meet to mark up several bills, including HR 921, the "Minority Serving Institution Digital and Wireless Technology Opportunity Act of 2005". The hearing will be webcast. Press contact, Joe Pouliot at 202 225-0581 or joe dot pouliot at mail dot house dot gov. Location: Room 2318, Rayburn Building.

10:00 AM. The House Financial Services Committee will hold a hearing titled "Assessing Data Security: Preventing Breaches and Protecting Sensitive Information". Location: Room 2128, Rayburn Building.

10:00 AM. The U.S. Court of Appeals (FedCir) will hear oral argument in Ericsson v. Harris. This is an appeal from the U.S. District Court (NDTex) in a patent infringement case involving cellular telephony. This case is D.C. No. 3-98 CV 2903-M and App. Ct. No. 04-1444. Location: Courtroom 203, 717 Madison Place, NW.

11:00 AM. The House Republican Hi-Tech Working Group will hold a news conference to announce its agenda for 109th Congress. The scheduled speakers include Speaker Dennis Hastert (R-IL), Rep. Roy Blunt (R-MO), Rep. Eric Cantor (R-VA), Rep. Bob Goodlatte (R-VA), Rep. Joe Barton (R-TX), Rep. David Dreier (R-CA),  and Rep. Lamar Smith (R-TX). Press contact: Larry Farnsworth at 202 225-2800. Location: Room HC-5, Capitol Building.

1:00 - 5:00 PM. The U.S. Patent and Trademark Office's (USPTO) Nanotechnology Customer Partnership will hold a meeting. RSVP to Jill Warden at jill dot warden at uspto dot gov or 571 272-1267. See, notice. Location: USPTO, Madison Auditorium, South Side, 600 Dulany Street, Alexandria, Virginia.

2:00 - 4:00 PM. The Federal Communications Commission's (FCC) World RadioCommunication 2007 (WRC-07) Advisory Committee's Informal Working Group 3: IMT-2000 and 2.5 GHz Sharing Issues will meet. Location: FCC.

9:00 AM - 6:00 PM. will host a one day conference titled "IP-Based Communications Policy Summit". See, conference web site. Location: Plaza Hotel.

Day three of a three day event hosted by Internet2 and titled "Spring 2005 Internet2 Member Meeting". See, notice. Location: Crystal Gateway Marriott, 1700 Jefferson Davis Highway, Arlington, VA.

Thursday, May 5

The House will meet at 10:00 AM for legislative business. The agenda includes several non-technology related items.  See, Republican Whip Notice.

9:15 AM - 12:15 PM. The American Enterprise Institute (AEI) will host an event titled "The Effect of Wireless Telecommunications on Economic Development in Africa". The speakers will be Gregory Sidak (AEI), Leonard Waverman (London Business School), Edward Graham (Institute for International Economics), Scott Wallsten (AEI), Diane Coyle (Enlightenment Economics), Neil Gough (Vodafone Group), and Claude Barfield (AEI). See, notice and registration page. Location: 12th floor, 1150 17th St., NW.

9:30 AM. The U.S. Court of Appeals (DCCir) will hear oral argument in American Bar Association v. FTC, No. 04-5257. Judges Sentelle, Randolph and Roberts will preside. This case involves challenges to the Federal Trade Commission's (FTC) application of the financial privacy provisions of the Gramm Leach Bliley Act to practicing attorneys. See, story titled "Court Hears Arguments on Bar Associations' Challenges to FTC's Financial Privacy Rules" in TLJ Daily E-Mail Alert No. 673, June 4, 2003. Location: Prettyman Courthouse, 333 Constitution Ave., NW.

9:30 AM. The U.S. District Court (DC) will hold a preliminary injunction hearing in Trudeau v. FTC, a false and deceptive telemarketing case. This is D.C. No. 1:2005-cv-00400-JDB. Judge Bates will preside. Location: Prettyman Courthouse, 333 Constitution Ave., NW.

10:00 AM. The House Judiciary Committee's (HJC) Subcommittee on Crime, Terrorism, and Homeland Security will hold the sixth of its oversight hearing on the implementation of the USA PATRIOT Act. This hearing will address § 212, titled "Emergency disclosure of electronic communications to protect life and limb". The hearing will be webcast by the HJC. Press contact: Jeff Lungren or Terry Shawn at 202 225-2492. Location: Room 2141, Rayburn Building.

10:00 AM. The Center for National Software Studies will hold a news conference to release a report. See, notice. For more information, contact Alan Salisbury at 703 319-2187. Location: Lisagor Room, National Press Club, 529 14th St. NW, 13th Floor.

Day one of a two day conference hosted by the Computer Law Association (CLA) titled "CLA World Computer and Internet Law Conference". See, conference brochure [PDF]. Location: Park Hyatt Hotel, 24th at M St. NW.

Friday, May 6

9:30 AM. The U.S. Court of Appeals (DCCir) will hear oral argument in Preston Small v. FCC, No. 04-1056. Judges Edwards, Henderson and Tatel will preside. Location: Prettyman Courthouse, 333 Constitution Ave., NW.

9:30 - 11:00 AM. The Progressive Policy Institute (PPI) will host a book forum titled "Can American Compete with Asia?". Kent Hughes will discuss his book, Building the Next American Century: The Past and Future of American Economic Competitiveness [Amazon]. Robert Atkinson, Director of the PPI's Technology and New Economy Project, will comment. For more information, contact Kyra Jennings or Austin Bonner at 202 547-0001. Location: 600 Pennsylvania Avenue, SE, Suite 400.

10:00 AM. The U.S. Court of Appeals (FedCir) will hear oral argument in Datamize v. Plumtree Software, No. 04-1564. This is patent case involving internet portal technology. Location: Courtroom 203, 717 Madison Place, NW.

12:15 - 1:45 PM. The New America Foundation (NAF) will host a brown bag lunch titled "Hot Property: The Threat of Intellectual Property Theft to our Economy and Safety". The speakers will be Pat Choate, author of Hot Property: The Stealing of Ideas in an Age of Globalization [Amazon], and Barry Lynn (NAF). RSVP to Jennifer Buntman at 202 986-4901 or buntman at newamerica dot net. See, notice. Location: NAF, 1630 Connecticut Ave, 7th Floor.

Day two of a two day conference hosted by the Computer Law Association (CLA) titled "CLA World Computer and Internet Law Conference". See, conference brochure [PDF]. Location: Park Hyatt Hotel, 24th at M St. NW.

Sunday, May 8

Mothers Day.

Monday, May 9

5:00 PM. Deadline to submit reply comments to the Copyright Office (CO) in response to its notice of inquiry (NOI) regarding orphan works -- copyrighted works whose owners are difficult or impossible to locate. The CO stated in a notice in the Federal Register that it seeks public comments on "whether there are compelling concerns raised by orphan works that merit a legislative, regulatory or other solution, and what type of solution could effectively address these concerns without conflicting with the legitimate interests of authors and right holders." See, Federal Register, January 26, 2005, Vol. 70, No. 16, at Pages 3739 - 3743.

Deadline to submit to the Federal Communications Commission (FCC) initial comments and petitions to deny in its antitrust merger review proceeding (transfer of control of licenses) associated with the acquisition of MCI by Verizon. See, FCC Public Notice DA 05-762 in WC Docket No. 05-75.

Deadline to submit initial comments to the Federal Communications Commission (FCC) in response to its notice of proposed rulemaking (NPRM) regarding implementation of Section 207 of the Satellite Home Viewer Extension and Reauthorization Act of 2004, extends Section 325(b)(3)(C) of the Communications Act until 2010 and amends that section to impose reciprocal good faith retransmission consent bargaining obligations on multichannel video programming distributors. This proceeding is MB Docket No. 05-89. See, FCC Public Notice DA 05-772, and notice in the Federal Register, March 24, 2005, Vol. 70, No. 56, at Pages 15048 - 15051. See also, story titled "FCC Adopts and Releases NPRM Implementing § 207 of SHVERA" in TLJ Daily E-Mail Alert No. 1,090, March 8, 2005.

Tuesday, May 10

10:00 AM. The House Judiciary Committee's (HJC) Subcommittee on Crime, Terrorism, and Homeland Security will hold the seventh of its oversight hearing on the implementation of the USA PATRIOT Act. This hearing is titled "Implementation of the USA PATRIOT Act: Prohibition of Material Support Under Sections 805 of the USA PATRIOT Act and 6603 of the Intelligence Reform and Terrorism Prevention Act of 2004". The hearing will be webcast by the HJC. Press contact: Jeff Lungren or Terry Shawn at 202 225-2492. Location: Room 2141, Rayburn Building.

2:30 PM. The Senate Commerce Committee (SCC) will hold a hearing on titled "Identity Theft and Data Broker Services". Press contact: Melanie Alvord (Stevens) at 202 224-8456 or Melanie_Alvord at commerce dot senate dot gov, or Andy Davis (Inouye) at 202 224-4546 or Andy_Davis at commerce dot senate dot gov. See, notice. The hearing will be webcast by the SCC. Location: Room 253, Russell Building.

Wednesday, May 11

11:00 AM. The Cato Institute will host a panel discussion titled "Does the World Trade Organization Serve America's Interests in the Global Economy?". The speakers will be Douglas Irwin (Dartmouth College), Grant Aldonas (recent Undersecretary of Commerce for International Trade), and Rep. Ron Paul (R-TX). See, notice. The event will be webcast by Cato. Lunch will follow the program. Location: Cato, 1000 Massachusetts Ave., NW.

RESCHEDULED FOR JUNE 22. The Federal Communications Bar Association (FCBA) will host a continuing legal education (CLE) seminar on voice over internet protocol (VOIP).

Deadline to submit nominations for the Federal Communications Bar Association's (FCBA) Young Lawyer's Committee's (YLC) elections, to be held on May 18. All nominations must be e-mailed to Jason Friedrich or Pam Slipakoff by May 11. For more information, contact Jason Friedrich at jason dot friedrich at dbr dot com or 202 354-1340 or Pam Slipakoff at pamslip at yahoo dot com or 202 418-7705.