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May 10, 2005, 9:00 AM ET, Alert No. 1,132.
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GAO Reports on Electronic Substitutes for USPS Mail Service

5/9. The Government Accountability Office (GAO) released a report [PDF] titled "U.S. Postal Service: The Service’s Strategy for Realigning Its Mail Processing Infrastructure Lacks Clarity, Criteria, and Accountability".

This report addresses the U.S. Postal Service's (USPS) lack of clear strategy for responding to changes in the marketplace. However, it also touches on one of those changes -- consumers' substitution of electronic mail and electronic payments for the USPS's First Class Mail delivery service.

The report states that "Questions remain about how the Service intends to realign its processing and distribution infrastructure and workforce. The Service’s strategy for realigning has not been clear because the Service has outlined several seemingly different strategies over the past 3 years. None of these strategies include criteria and processes for eliminating excess capacity, which may prolong inefficiencies. Also, the strategy lacks sufficient transparency and accountability, excludes stakeholder input, and lacks performance measures for results."

The report finds that "First-Class Mail volume, the class that contributes the majority of revenue to institutional costs, declined 5 percent from fiscal year 2000 to 2004 and this downward trend is expected to continue. The Service has attributed the declining First-Class Mail volume to the impact of electronic diversion as businesses, nonprofit organizations, governments, and households increasingly automate their financial transactions and divert correspondence to the Internet. For example, electronic bill payment allows users to pay bills using the Internet rather than sending checks through the mail."

The report adds that "recent legislation that became effective October 28, 2004, is intended to improve the efficiency of check processing and may reduce reliance on the physical movement of checks through the mail.5 It is likely that this change will accelerate the decline in First-Class Mail volume."

11th Circuit Rules in Cell Tower Case

5/6. The U.S. Court of Appeals (11thCir) issued its opinion [PDF] in Michael Linet, Inc. v. Village of Wellington, a cell tower construction case. The Court of Appeals affirmed the District Court's judgment in favor of the local government that refused permission to construct a cell tower on a golf course. The Court of Appeals construed 47 U.S.C. § 332 in a manner that imposes minimal restraints on local governments.

Michael Linet, Inc. is a Florida corporation that serves as an agent to various cellular phone service providers, including Metro PCS, Inc. Linet sought to construct a 120 foot flagpole, with a cellular communications antenna concealed inside, on a golf course. The Village of Wellington refused permission.

Linet filed a complaint in U.S. District Court (SDFla) against the Village of Wellington alleging violation of 47 U.S.C. § 332 and 42 U.S.C. § 1983. The District Court dismissed the § 1983 claim, and held that the city did not violate § 332. The Court of Appeals affirmed.

The Supreme Court's March 2005 opinion [22 pages in PDF] in City of Rancho Palos Verdes v. Abrams resolved the § 1983 issue. The Supreme Court held that an individual who brings an action to enforce the limitations on state and local authority to regulate the location, construction, and modification of wireless communications facilities under 47 U.S.C. § 332, cannot also recover damages under 42 U.S.C. § 1983. See also, story titled "Supreme Court Holds That Individuals Who Sue Under §332 Cannot Also Recover Damages Under §1983" in TLJ Daily E-Mail Alert No. 1,101, March 23, 2005.

The Court of Appeals also affirmed the District Court on the § 332 claim.

47 U.S.C. § 332 provides, at § 332(c)(7)(A) that "Except as provided in this paragraph, nothing in this chapter shall limit or affect the authority of a State or local government or instrumentality thereof over decisions regarding the placement, construction, and modification of personal wireless service facilities." § 332(c)(7)(B) then provides limitations to this general rule.

§ 332(c)(7)(B) prevents state and local governments from unreasonably discriminating among providers, and from prohibiting the provision of service. It also provides that "Any decision by a State or local government or instrumentality thereof to deny a request to place, construct, or modify personal wireless service facilities shall be in writing and supported by substantial evidence contained in a written record."

Linet argued that the city unreasonably discriminated, and rejected the request without substantial evidence.

The Court of Appeals wrote that "Aesthetic objections coupled with evidence of an adverse impact on property values or safety concerns can constitute substantial evidence." It noted too that the city "heard objections from residents and a realtor concerning the cell site's negative impact on real estate values."

This case is Michael Linet, Inc. v. Village of Wellington, Florida, App. Ct. No. 04-14759, an appeal from the U.S. District Court for the Southern District of Florida, D.C. No. 03-80856-CV-DMM.

People and Appointments

5/6. John Stanley will join the General Counsel's office at Lenovo International. He has been Federal Communications Commission (FCC) Commissioner Kathleen Abernathy's acting legal advisor for wireline competition issues. See, FCC release. Lenovo acquired IBM's personal computing division earlier this year.

5/6. Lauren (Pete) Belvin will become acting legal advisor on wireline competition issues for Federal Communications Commission (FCC) Commissioner Kathleen Abernathy. Belvin's prior work experience includes positions at the law firm of Wilkinson Barker & Knauer, Qwest Communications, the Senate Commerce Committee, and the FCC. She has worked as legal advisor to FCC Commissioners, in the Office of Strategic Planning, in the Office of General Counsel, in the Office of Legislative Affairs, and in the Cable Television Bureau. See, FCC release.

5/6. President Bush announced his intent to nominate Edmund Hawley to be Assistant Secretary of Homeland Security for the Transportation Security Administration (TSA). See, White House release.

5/3. The Motion Picture Association of America (MPAA) announced in a release that Bill Murray, the EVP and C-Chief Operating Officer, will leave on May 10.

5/8. Lloyd Cutler died. He was one of the founding partners of the Washington DC law firm of Wilmer Cutler & Pickering, which is now Wilmer Cutler Pickering Hale & Dorr. See, release.

Trade News

5/9. On May 5, 2005, the Board of Directors of the National Council of Textile Organizations (NCTO) voted to support the Dominican Republic Central American Free Trade Agreement (DR-CAFTA). See also, May 9 statement by the new U.S. Trade Representative, Robert Portman.

5/5. Jian Guo Qu pled guilty in U.S. District Court (EDWisc) to one count of violating 18 U.S.C. § 371 in connection with his efforts to export dual-use semi-conductors and other electronic components from the United States to the People's Republic of China without export licenses issued by the Department of Commerce's Bureau of Industry and Security (BIS/BXA). See, BXA release. Section 371 criminalizes a conspiracy by two or more persons to violate some underlying statute. In addition, Ruo Ling Wang, the wife of Jian Guo Qu, pled guilty to one count of violating 50 U.S.C. § 1705(b). The BXA stated in a release that this count relates to "falsifying and undervaluing a shipment of illegally exported electronics valued at $11,000 from the United States to China in an attempt to avoid scrutiny or inspection". Section 1705 criminalizes the violation of DOC regulations. The BXA also stated that two other defendants, Ning Wen and his wife Hailin Lin, are scheduled to be tried in September of 2005.

5/4. World Trade Organization (WTO) Director General Supachai Panitchpakdi gave a speech at the OECD Council at Ministerial Level in Paris, France regarding trade negotiations under the Doha Development Round. He stated that "The question now is whether we are on course or not. I am afraid that the short reply is that we are not." He reviewed the progress in each area of negotiations. He concluded that "A successful outcome would have a substantial positive effect on the world economy and on your peoples. Failure would be a major setback for growth, development and the multilateral system."

5/3. European Commissioner for Trade Peter Mandelson wrote an essay on the Doha Development Round, published in both Financial Times and his web site, in which he asserted that "As trade ministers from across the world meet in Paris this week, they will be aware of growing scepticism about the outlook for further liberalising international trade. I understand the anxiety but I think the pessimism is misplaced. There is still time -- just -- to deliver on the original development-through-trade agenda envisaged in the World Trade Organisation's Doha round of talks before negotiating fatigue takes over." He went on to explain the benefits of a successful Doha round.

More News

William Donaldson5/8. William Donaldson (at right), the Chairman of the Securities and Exchange Commission (SEC), gave a speech in Philadelphia, Pennsylvania at the 2005 CFA Institute Annual Conference. He said that "As the structures supporting the analyst profession changed, so did the information upon which it rested. Data which was once available to a privileged few, and was difficult to obtain, became available to anyone with an Internet connection. But this transparency, and ``information proliferation,´´ did not necessarily translate into better analysis. Indeed, there’s probably more unreliable information -- masquerading as ``analysis´´ -- floating around today than ever before." He continued that "In the aftermath of the dot-com bubble, and the Global Settlement, investment research remains in transition. A number of fundamental questions have yet to be answered: How can we ensure the continued development of a robust marketplace and compensation for comprehensive, high-quality research?"

5/5. Hewitt Pate, the Assistant Attorney General in charge of the Department of Justice's (DOJ) Antitrust Division, wrote an amicus curiae brief for the U.S. Court of Appeals (2ndCir) in the Billing v. Credit Suisse First Boston. The Court of Appeals requested the views of the DOJ on implied antitrust immunity.

5/3. Comcast announced in a release that AT&T "reached a settlement of certain At Home litigation. Comcast will pay AT&T Corp. $170 million to reimburse it for Comcast's portion of AT&T's settlement. Pursuant to the terms of its acquisition of AT&T Broadband from AT&T, Comcast is contractually liable for 50% of the $340 million settlement amount for these lawsuits, which are described below. The settlement also releases all claims by AT&T and AT&T Broadband in the At Home bankruptcy. The settlement is subject to the approval of the United States Bankruptcy Court for the Northern District of California." Comcast continued that "The lawsuits are: (i) a lawsuit filed against AT&T and others in Santa Clara, California state court alleging various breaches of fiduciary duties, misappropriation of trade secrets and other causes of action and (ii) an action filed against AT&T in the District Court for the Northern District of California alleging patent infringement. As part of the settlement, a lawsuit filed in the United States Bankruptcy Court against AT&T, AT&T Broadband and others seeking to recover alleged "preference" payments will be dismissed."

5/2. EMC Corporation and HP announced in a release that "they have agreed to amicably dismiss all claims and counterclaims with no findings or admissions of liability in a settlement of a longstanding patent dispute involving patent infringement allegations between the two companies." They added that "As part of this settlement agreement, HP will pay a net $325 million balancing payment to EMC, which can be satisfied through the purchase for resale or internal use of complementary EMC products, such as the VMware product line, over the next five years. EMC and HP also have signed a five-year patent cross-license agreement." See also, EMC release.

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

The House will meet at 12:30 PM for morning hour, and at 2:00 PM for legislative business. It will consider several non-technology related items under suspension of the rules. Votes will be postponed until 6:30 PM. See, Republican Whip Notice.

The Senate will meet at 9:45 AM for morning business. It will then begin consideration of the Conference Report on HR 1268, the Iraq/Afghanistan Supplemental Appropriations bill.

9:30 AM. The Senate Judiciary Committee (SJC) has scheduled a hearing regarding implementation of the USA PATRIOT Act. The SJC frequently cancels meetings without notice. The scheduled witnesses include Sen. Larry Craig (R-ID) and Sen. Richard Durbin (D-IL), sponsors of S 737, the SAFE Act. The scheduled witnesses also include former Rep. Bob Barr (R-GA), David Cole (Georgetown University Law Center), Daniel Collins (Munger Tolles & Olsen), James Dempsey (Center for Democracy and Technology), Andrew McCarthy (The Foundation for the Defense of Democracies), Suzanne Spaulding (The Harbour Group). See, notice. Press contact: Blain Rethmeier (Specter) at 202 224-5225, David Carle (Leahy) at 202 224-4242 or Tracy Schmaler (Leahy) at 202 224-2154. Location: Room 226, Dirksen Building.

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 witnesses will be Glenn Fine (Inspector General of the Department of Justice), Gregory Katsas (a Deputy Assistant Attorney General), Barry Sabin (Chief of the Counterterrorism Section for the DOJ's Criminal Division), and Ahilan Arulanantham (ACLU). 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 titled "Identity Theft and Data Broker Services". Press contact: Melanie Alvord (Stevens) 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

The House will meet at 10:00 AM for legislative business. There are no technology related items on the agenda. See, Republican Whip Notice.

9:30 AM. The Senate Judiciary Committee (SJC) has scheduled an executive business meeting. The SJC frequently cancels meetings without notice. See, notice. Press contact: Blain Rethmeier (Specter) at 202 224-5225, David Carle (Leahy) at 202 224-4242 or Tracy Schmaler (Leahy) at 202 224-2154. Location: Room 226, Dirksen Building.

10:00 AM. The Senate Commerce Committee (SCC) will hold a hearing on spyware. Press contact: Melanie Alvord (Stevens) 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.

11:00 AM. The House Commerce Committee's Subcommittee on Commerce, Trade, and Consumer Protection will hold a hearing titled "Securing Consumers' Data: Options Following Security Breaches". The hearing will be web cast by the Committee. Location: Room 2123, Rayburn Building.

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.

TIME CHANGE. 2:00 - 4:00 PM. The House Science Committee's Subcommittee the Environment, Technology, and Standards will hold a hearing titled "Europe, China, and the Use of Technical Standards as Trade Barriers: How should the U.S. Respond?" The witnesses will be Hratch Semerjian (acting Director of the National Institute of Standards and Technology), Don Deutsch (Oracle), David Karmol (American National Standards Institute), Robert Noth (Deere & Company), and Joe Bhatia (Underwriters Laboratory). The hearing will be webcast. Location: Room 2318, Rayburn Building.

4:00 PM. The House Judiciary Committee's (HJC) Subcommittee on Courts, the Internet and Intellectual Property will hold a hearing titled "Oversight of Public Performance Rights Organizations". The hearing will be webcast by the HJC. Press contact: Jeff Lungren or Terry Shawn at 202 225-2492. Location: Room 2141, Rayburn Building.

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.

Thursday, May 12

The House will meet at 10:00 AM for legislative business. There are no technology related items on the agenda. See, Republican Whip Notice.

POSTPONED. The House Judiciary Committee's Subcommittee on Courts, the Internet, and Intellectual Property will hold its third hearing on the Committee Print of HR __ [52 pages in PDF], the "Patent Act of 2005". Press contact: Jeff Lungren or Terry Shawn at 202 225-2492. Location: Room 2141, Rayburn Building.

8:00 AM. The Federal Communications Bar Association (FCBA) will host a breakfast. The speaker will be Gary Shapiro, P/CEO of the Consumer Electronics Association (CEA). The price to attend varies from $30 to $55. See, registration form [MS Word]. Location: J.W. Marriott Hotel, 1331 Pennsylvania Ave., NW.

RESCHEDULED FOR MAY 19. 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 U.S. Court of Appeals (DC) will hear oral argument in Christopher Shays v. FEC, No. 04-5352. Judges Edwards, Henderson and Tatel will preside. Location: Prettyman Courthouse, 333 Constitution Ave., NW.

10:00 AM - 12:00 NOON. The House Science Committee will hold a hearing titled "The Future of Computer Science Research in the U.S." The witnesses will be John Marburger (Director of the President's Office of Science and Technology Policy), Anthony Tether (Director of the Defense Advanced Research Projects Agency), William Wulf (President of the National Academy of Engineering), and Tom Leighton (Chief Scientist of Akamai Technologies). Location: Room 2318, Rayburn Building.

10:00 AM. The Senate Commerce Committee (SCC) will hold a hearing on S 967 and issues related to the broadcast of prepacked news stories produced by government agencies. Press contact: Melanie Alvord (Stevens) 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.

10:00 - 11:30 AM. The American Enterprise Institute (AEI) and the National Defense University (NDU) will host a panel discussion titled "Will Technology Be a Source of Chinese Influence in Asia?" The speakers will be Ernest Preeg (Manufacturers Alliance), Tai Ming Cheung (University of California San Diego), Will Martin (World Bank), Claude Barfield (AEI), and Phillip Saunders (NDU). See, notice. Location: AEI, 12th floor, 1150 17th St., NW.

10:15 AM. The American Enterprise Institute (AEI) will host a panel discussion titled "Antitrust Policy and Vertical Restraints". The speakers will include David Evans (LECG), Luke Froeb (FTC), and Michael Waldman (Cornell University). See, notice. Location: AEI, 12th floor, 1150 17th St., NW.

12:00 NOON. The National Telecommunications and Information Administration (NTIA) and the Federal Communications Commission (FCC) will hold a meeting. The agenda includes the role of NTIA in spectrum management, the IRAC process, and the FCC-NTIA interaction with respect to license applications, rulemaking proceedings, and spectrum management policy issues at the FCC. The speakers will be Fred Wentland (NTIA), Karl Nebbia (NTIA), Julius Knapp (FCC), and other FCC officials. The Federal Communications Bar Association (FCBA) states that this is an FCBA brown bag lunch, and that attendees should RSVP to Wendy Parish at wendy@fcba.org. Location: FCC, 7th Floor South Conference Room.

12:15 - 2:00 PM. The Forum on Technology and Innovation will host a luncheon titled "Future of U.S. Manufacturing". The speakers will be Mark Bamforth (Genzyme), Gary Heiman (Standard Textile), and Mark Mills (Digital Power Group). See, notice. Location: Room 902, Hart Building, Capitol Hill.

4:00 PM. The Senate Judiciary Committee (SJC) has scheduled a hearing on executive branch nominations. The SJC frequently cancels meetings without notice. See, notice. Press contact: Blain Rethmeier (Specter) at 202 224-5225, David Carle (Leahy) at 202 224-4242 or Tracy Schmaler (Leahy) at 202 224-2154. Location: Room 226, Dirksen Building.

6:00 - 8:00 PM. Federal Communications Bar Association's (FCBA) Young Lawyers Committee will host an event titled "Happy Hour". For more information, contact Pam Slipakoff at pamslip at yahoo dot com. Location: Modern Brasserie, 555 8th Street, NW.

Friday, May 13

The House will meet at 10:00 AM for legislative business. There are no technology related items on the agenda. See, Republican Whip Notice.

Monday, May 16

Day one of a two day event hosted by the American Cable Association titled "Annual Washington Summit".

Tuesday, May 17

9:00 AM - 5:30 PM. The Federal Communications Commission's (FCC) North American Numbering Council (NANC) will meet. See, notice and agenda [2 pages in PDF]. Location: FCC, 445 12th Street, SW, Room TW-C305.

10:00 AM. The House Ways and Means Committee's Subcommittee on Trade will hold a hearing titled on the future of the World Trade Organization (WTO). See, notice. Location: Room 1100, Longworth Building.

11:30 AM - 1:00 PM. The Business Software Alliance (BSA) and Center for Strategic and International Studies (CSIS) will host a panel discussion titled "Battling International Organized Cyber Crime". The keynote speaker will be Ralph Basham (Director of the U.S. Secret Service). The panelists will be Ed Appel (Joint Council of Information Age Crime), Bill Conner (Ch/CEO of Entrust), James Lewis (CSIS), Brian Nagel (U.S. Secret Service), Kim Peretti (Trial Attorney in the DOJ's Computer Crime and Intellectual Property Section), Phil Reitinger (Microsoft), and Jody Westby (PricewaterhouseCoopers). Lunch will be served. RSVP to rsvp at bsa dot org by May 11. Press contact: Wendy Rosen at 202 530-5127 or wendyr at bsa dot org. Location: 1800 K Street, NW, B-1 conference center.

12:15 PM. The Federal Communications Bar Association's (FCBA) Mass Media Committee will host a brown bag lunch. Location: Dow Lohnes & Albertson, 1200 New Hampshire Ave., NW, Suite 800.

Day two of a two day event hosted by the American Cable Association titled "Annual Washington Summit".

Day one of a three day event hosted by the Armed Forces Communications and Electronics Association (AFCEA) titled "TechNet International 2005: Network Centric Operation: Balancing Speed and Agility with Security". See, event web site and schedule. Location: Washington Convention Center.