Tech Law Journal Daily E-Mail Alert
June 30, 2005, 9:00 AM ET, Alert No. 1,165.
Home Page | Calendar | Subscribe | Back Issues | Reference
AMD Files Antitrust Complaint Against Intel

6/27. Advanced Micro Devices (AMD) filed a complaint [PDF] in U.S. District Court (DDel) against Intel alleging violation of Section 2 of the Sherman Antitrust Act, Sections 4 and 16 of the Clayton Act, and the California Business and Professions Code.

Hector Ruiz, Ch/P/CEO of AMD, stated in a release that "Everywhere in the world, customers deserve freedom of choice and the benefits of innovation -- and these are being stolen away in the microprocessor market ... Whether through higher prices from monopoly profits, fewer choices in the marketplace or barriers to innovation -- people from Osaka to Frankfurt to Chicago pay the price in cash every day for Intel’s monopoly abuses." See also, open letter from Ruiz.

Paul Otellini, P/CEO of Intel, stated in a release that "Intel has always respected the laws of the countries in which we operate ... We compete aggressively and fairly to deliver the best value to consumers. This will not change. Over the years, Intel has been involved in other antitrust suits and faced similar issues. Every one of those matters has been resolved to our satisfaction. We unequivocally disagree with AMD’s claims and firmly believe this latest suit will be resolved favorably, like the others."

The complaint alleges that Intel forced major customers to accept exclusive deals, withheld rebates and marketing subsidies as a means of punishing customers who buy more than prescribed quantities of processors from AMD, threatened retaliation against customers doing business with AMD, establishing quotas keeping retailers from selling the computers they want, and forced PC makers to boycott AMD product launches.

The prayer for relief requests that the Court "Find that Intel is wrongfully maintaining its monopoly in the x86 Microprocessor Market in violation of Section 2 of the Sherman Act and award AMD treble damages in an amount to be proven at trial, pursuant to Section 4 of the Clayton Act, 15 U.S.C. § 15(a)".

The complaint further requests that the Court "Find that Intel has made secret payments and allowances of rebates and discounts, and secretly and discriminatorily extended to certain purchasers special services or privileges, all in violation of California Business & Professions Code § 17045, and pursuant thereto award AMD treble damages for its resulting lost profits in an amount to be proven at trial".

The complaint further requests that the Court "Find that Intel has intentionally interfered with valuable business relationships of AMD to its economic detriment and award AMD damages in an amount to be proven at trial for its resulting losses, as well as punitive damages, as permitted by law".

The complaint further requests that the Court "Grant injunctive relief prohibiting Intel and all persons, firms and corporations acting on its behalf or under its direction or control from engaging in any further conduct unlawful under Section 2 of the Sherman Act or Section 17045 of the California Business and Professions Code".

The complaint further requests that the Court "Award AMD such other, further and different relief as may be necessary or appropriate to restore and maintain competitive conditions in the x86 Microprocessor Market"

Japan Fair Trade Commission. Thomas McCoy, EVP Legal Affairs for AMD, stated that "You don't have to take our word for it when it comes to Intel’s abuses; the Japanese government condemned Intel for its exclusionary and illegal misconduct ... We encourage regulators around the world to take a close look at the market failure and consumer harm Intel's business practices are causing in their nations. Intel maintains illegal monopoly profits at the expense of consumers and computer manufacturers, whose margins are razor thin. Now is the time for consumers and the industry worldwide to break free from the abusive Intel monopoly."

This is a reference to the recommendation of the Japan Fair Trade Commission (JFTC) regarding Intel's Japanese subsidiary, Intel Kabushiki Kaisha (IJKK), earlier this year. The JFTC wrote in a March 8 English language release that it "requires IJKK to cease and desist its conducts which violate Section 3 of the Antimonopoly Act". On March 31, 2005 Intel announced that it accepts the March 8 recommendation of the JFTC.

See also, story titled "Intel Accepts Recommendation of Japanese FTC Regarding Anticompetitive Marketing Practices" in TLJ Daily E-Mail Alert No. 1,107, April 1, 2005.

AMD's attorney of record is the Delaware law firm of Richards Layton & Finger.

This case is Advanced Micro Devices, Inc. and AMD International Sales & Service, Ltd. v. Intel Corporation and Intel Kabushiki Kaisha, U.S. District Court for the District of Delaware, D.C. No. 05-441.

House Rural Caucus Seeks Expansion of Universal Service Taxes and Subsidies and Interconnection Regulation

6/28. Rep. Gil Gutnecht (R-MN), Rep. Bart Stupak (D-MI), and fifty-five other Representatives with rural constituents wrote a letter [PDF] to Rep. Joe Barton (R-TX) and Rep. John Dingell (D-MI), the Chairman and ranking Democrat on the House Commerce Committee (HCC), urging that any rewrite of the Communications Act include an expansion of universal service subsidies, an expansion of the universal service tax base, and an expansion of interconnection regulation.

The Rural Caucus wants universal service subsidies to be expanded to include broadband DSL, cable internet access, and other services. The Rural Caucus also wants to expand the services subject to universal service taxes to all two way communications. The Rural Caucus also wants to the impose interconnection regulation upon non-telecommunications services.

The letter states that "As the United States moves into the broadband age, it is imperative that we do not forget the principles that have served us so well. Let's make sure that the commitment to universal service access to communications services is protected during a rewrite so that all Americans can have access to advanced communications, such as DSL, cable, wireless, and satellite."

The letter further requests that the HCC "incorporate the principles on the reverse when drafting legislation re-writing the Telecommunications Act. If incorporated, these principles will help ensure that all Americans have access to advanced broadband services at affordable rates."

The letter also includes an attached list of principles. It provides that "The base of contributors to universal service must be expanded to include everyone who uses the infrastructure. This includes, but is not limited to: all providers of 2-way communications regardless of technology used ...".

It also states that "The universal service fund must continue to be an industry funded mechanism and not supported through general tax revenues." And, "The fund must also not be subject to the Anti-Deficiency Act."

It further states that "All providers must continue to have the obligation to allow other providers to interconnect with their networks regardless of the technology utilized".

Currently, 47 U.S.C. § 251 requires, and regulates, interconnection by "telecommunications carriers". While telecommunications carriers have been subject to an interconnection mandate, and government regulation of the prices and terms of interconnection, the internet has successfully interconnected through voluntary agreements, without government mandates or regulation. The Rural Caucus proposal's use of the phrase "regardless of the technology" implies expansion of the interconnection requirement.

The Rural Caucus letter also proposes that "Carriers must be compensated for all traffic utilizing their networks".

The Independent Telephone and Telecommunications Alliance (ITTA), the National Telecommunications Cooperative Association (NTCA), the Organization for the Promotion and Advancement of Small Telephone Companies (OPASTCO), and the Western Telecommunications Alliance (WTA) all praised the Rural Caucus proposal. See, release.

Steve Largent, P/CEO of the Cellular Telecommunications and Internet Association (CTIA), stated in a release that "Since wireless consumers are significant and disproportionate payers into the universal service and intercarrier compensation systems, the wireless industry agrees with the Rural Caucus in supporting a universal service system that collects from all segments of the communications industry. CTIA appreciates the Rural Caucus's support for rules that ensure accountability of these systems. Consumers shouldn't have to pay any more into the universal service and intercarrier compensation systems than is necessary to provide them with the high quality and affordable services they deserve. To that end, CTIA supports regulatory reforms to the universal service and intercarrier compensation systems that would encourage and reward efficiency, while ensuring that the goals of universal service are maintained.  In addition, CTIA wholeheartedly agrees that the principle of competitive neutrality must be maintained in any Telecommunications Act re-write."

Walter McCormick, P/CEO of the U.S. Telecom Association (USTA), wrote diplomatically in a release that "This endeavor illustrates yet another influential group acknowledging the critical need for meaningful telecom reform now."

Bush Nominates McCormick and Jackson for Export Control Office

6/28. President Bush nominated David McCormick to be Under Secretary of Commerce for Export Administration. That is, he has been selected to lead the Department of Commerce's (DOC) Bureau of Industry and Security (BIS). The BIS was previously named the Bureau of Export Administration (BXA). See, White House release and release.

McCormick currently is the President of Ariba, Inc., a software company. He is a graduate of the U.S. Military Academy at West Point.

The previous head of the BIS was Kenneth Juster. Juster is now the EVP of Legal Affairs and Corporate Development at The acting head of the BIS is Peter Lichtenbaum.

The BIS regulates exports, and other activities, for national security, and other, purposes. This includes regulation of the export of dual use items, such as computers, microprocessors, software and encryption products. This BIS also regulates business practices that it identifies as "deemed exports", such as employment of foreign nationals, use of software by foreign nationals, and access to technical data by foreign nationals. The BIS has also used its regulation of exports to attempt to control domestic production and sales.

In addition, President Bush nominated Darryl Jackson to be the Assistant Secretary of Commerce (Export Enforcement). Jackson is a partner in the Washington DC office of the law firm of Arnold & Porter. His firm biography states that he handles civil litigation and white collar criminal defense. However, it makes no reference to export enforcement.

The previous Assistant Secretary for Export Enforcement was Julie Myers. The acting Assistant Secretary is Wendy Wysong.

Groups Debate Impact of DTV Transition

6/29. The Consumers Union (CU) and Consumer Federation of America (CFA), Washington DC based interest groups, released a report [11 pages in PDF] titled "Estimating the Consumer Costs of the Federally Mandated Digital TV Transition".

This report states that, based on a survey of 1,007 U.S. households conducted on June 10-13, 2005, there are over 80 Million over the air TV sets, and that 15% of U.S. households have only over the air TV.

The CU/CFA stated in a release that "Congress is considering legislation to require a firm deadline for the transition to digital-only television broadcasting which will eliminate analog signals that most televisions sets are designed to receive. Unless those sets are connected to cable or satellite services, they will stop receiving broadcasts after the final transition. Congress is also debating whether and how much to compensate consumers who must buy converter boxes to prevent their televisions from going dark."

The CU/CFA report also compares its survey results to other recent survey results.

The Consumer Electronics Association (CEA), a Washington DC based trade group that has also conducted a survey, responded that the CU/CFA report is methodologically flawed.

The CEA's Michael Petricone stated in a release that the CU/CFA survey "appears to assume that any TV not connected to cable or satellite is connected to a broadcast antenna. In fact, as our most recent (May 2005) survey found, a minimum of 31 million sets are not connected to broadcast antennas and are used exclusively for video games, DVDs or other purposes. For this reason, the CU and CFA survey appears to significantly overstate the number of televisions used to view OTA broadcasting." (Parentheses in original.)

More News

6/28. Microsoft stated in a release that "it has signed a Technical Cooperation Agreement with the High-Tech Crime Technology Division, Info-Communications Bureau of the National Police Agency (NPA) of Japan. Under this agreement, Microsoft will help support the division's cybercrime-fighting efforts by providing security training and a hot line for sharing technical information."

Washington Tech Calendar
New items are highlighted in red.
Thursday, June 30

The House will meet at 10:00 AM for legislative business. See, Republican Whip Notice.

The Senate will meet at 9:00 AM. It will resume consideration of  S 1307, the CAFTA bill.

8:00 AM. The Discovery Institute will host a "private breakfast" for "respected members of the media". George Gilder will discuss telecom reform. RSVP to 202 682-1201 or lgage at discovery dot org. Location: The University Club, 1135 16th Street, NW.

POSTPONED. The House Judiciary Committee's Subcommittee on Courts, the Internet and Intellectual Property (CIIP) will meet to mark up HR 2795, the "Patent Act of 2005". Rep. Lamar Smith (R-TX), the Chairman of the CIIP Subcommittee, announced this meeting at a hearing on June 9, 2005. See, story titled "House CIIP Subcommittee Holds Hearing on Patent Bill" in TLJ Daily E-Mail Alert No. 1,151, June 10, 2005. Location: Room 2141, Rayburn Building.

9:30 AM. Federal Communications Commission (FCC) Commissioner Kathleen Abernathy will host and event titled "press breakfast". Location: FCC, Room 8B115, 445 12th Street SW.

9:30 AM. The Senate Judiciary Committee (SJC) is scheduled to hold an executive business meeting. The SJC frequently cancels meetings without notice. The agenda includes consideration of several bills, including S __, the "Personal Data Privacy and Security Act of 2005", sponsored by Sen. Arlen Specter (R-PA) and Sen. Patrick Leahy (D-VT), S 751, the "Notification of Risk to Personal Data Act", sponsored by Sen. Diane Feinstein (D-CA), and S 1326, the "Notification of Risk to Personal Data Act", sponsored by Sen. Jeff Sessions (R-AL). See, notice and agenda. The SJC rarely follows its published agenda. 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.

TIME CHANGE. 9:30 AM. The Senate Commerce Committee's Subcommittee on Technology, Innovation, and Competitiveness will hold a hearing on health information technology. The witnesses will be Sen. Mike Enzi (R-WY), Sen. Debbie Stabenow (D-MI), David Brailer (Department of Health and Human Services), Carolyn Clancy (DHHS), Hratch Semerjian (National Institute of Standards and Technology), Jonathan Perlin (Department of Veterans Affairs), Susan Bostrom (Cisco Systems), John Glaser (Partners HealthCare System), Peter Basch (MedStar Health), Pamela Pure (McKesson Corporation), and Karen Ignagni (America’s Health Insurance Plans). See, notice. The hearing will be webcast. 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. Location: Room 253, Russell Building.

10:00 AM. The House Ways and Means Committee will meet to mark up HR 3045, the "Dominican Republic-Central America-United States Free Trade Agreement Implementation Act". See, notice. Location: Room 1100, Longworth Building.

11:00 AM - 12:00 PM. The National Science Foundation's (NSF) National Science Board's Committee on Programs and Plans will meet. The agenda includes "Review of NSF draft Cyber Infrastructure Vision document" and "Next steps for developing a Board-approved High Performance Computing Strategy for NSF". See, notice in the Federal Register: June 22, 2005, Vol. 70, No. 119, at Page 36213. Location: NSF, Public Meeting Room 130, 4201 Wilson Boulevard, Arlington, VA.

12:00 NOON - 1:30 PM. The Advisory Committee to the Congressional Internet Caucus will host a panel discussion titled "The U.S. Patriot Act and E-Surveillance". The speakers will be William Moschella (Department of Justice), James Dempsey (Center for Democracy and Technology), and Emily Sheketoff, (American Library Association). See, notice. Lunch will be served. RSVP to or 202 638-4370. Location: Room HC-5, Capitol Building.

Day three of a four day conference of the Wireless Communications Association International (WCA) titled "WCA 2005". See, notice. Location: Marriott Wardman Park Hotel.

Deadline to submit initial comments to the Copyright Office's Copyright Royalty Board regarding its interim regulations governing the organization, administration, and procedures of the Copyright Royalty Board. See, notice in the Federal Register, May 31, 2005, Vol. 70, No. 103, at Pages 30901 - 30916.

Friday, July 1

The House may meet at 9:00 AM for morning hour. See, Republican Whip Notice.

Day four of a four day conference of the Wireless Communications Association International (WCA) titled "WCA 2005". See, notice. Location: Marriott Wardman Park Hotel.

Effective date of the final rule of the Department of the Treasury's (DOT) Office of the Comptroller of the Currency (OCC), the DOT's Office of Thrift Supervision (OTS), the Federal Reserve System, and the Federal Deposit Insurance Corporation (FDIC) implementing § 216 of the Fair and Accurate Credit Transactions Act of 2003, which is also known as the FACT Act. The FACT Act was HR 2622 in the 108th Congress. It is now Public Law No. No. 108-159. § 216 of the FACT Act adds a new § 628 to the Fair Credit Reporting Act (FCRA) that pertains to protecting consumers against the risks associated with unauthorized access to information about the consumer contained in a consumer report, such as fraud and related crimes, including identity theft. The FCRA is codified at 15 U.S.C. § 1681 et seq. The new section is codified at 15 U.S.C. § 1681w. See, notice in the Federal Register, December 28, 2004,  Vol. 69, No. 248, at Pages 77610 - 77621. See also, story titled "Financial Regulators Publish Notice of Final Rule Implementing Section 216 of FACT Act" in TLJ Daily E-Mail Alert No. 1046, December 29, 2004.

Deadline to submit comments to the Antitrust Modernization Commission (AMC) in response to the AMC's request for public comments regarding the Robinson-Patman Act. See, notice in the Federal Register: May 19, 2005, Vol. 70, No. 96, at Pages 28902 - 28907.

Deadline to submit initial comments to the Federal Communications Commission (FCC) in response to its public notice regarding refreshing the record on issues raised in the Further Notice of Proposed Rulemaking (FNPRM) related to carrier identification code (CIC) conservation and the definition of "entity" as found in section 1.3 of the CIC Assignment Guidelines. This public notice is DA 05-1154 in CC Docket No. 92-237; it was released on April 26, 2005. See, notice in the Federal Register, June 1, 2005, Vol. 70, No. 104, at Pages 31405 - 31406.

Deadline for states and telecommunications relay services (TRS) providers to file with the Federal Communications Commission (FCC) their annual consumer complaint log summaries. See, FCC notice.

Monday, July 4

Independence Day.

The House will not meet on Monday, July 4 through Friday, July 8. See, House calendar.

The Senate will not meet on Monday, July 4 through Friday, July 8. See, Senate calendar.

The Federal Communications Commission (FCC) and other federal offices will be closed for Independence Day. See, Office of Personnel Management's (OPM) list of federal holidays.

Tuesday, July 5

Deadline to submit reply comments to the Federal Communications Commission's (FCC) Office of Engineering and Technology (OET) in response to its Public Notice [PDF] regarding the United Telecom Council (UTC) request to be the Access Broadband over Power Line (Access BPL) database manager. This is DA 05-1637, dated June 9, 2005, in ET Docket No. 04-37.

Wednesday, July 6

10:00 AM. The U.S. Court of Appeals (FedCir) will hear oral argument in Sicom Systems v. Agilent Technologies, a case regarding standing to sue for patent infringement. See, October 5, 2004 Memorandum Opinion [PDF] of the U.S. District Court (Del). This is D.C. No. 03-1171-JJF, and App. Ct. No. 05-1066. Location: U.S. Court of Appeals, LaFayette Square, 717 Madison Place, Courtroom 201.

12:00 NOON - 2:00 PM. The DC Bar Association will host a program titled "File Sharing and Copyright Infringement after MGM Studios v. Grokster". The price to attend ranges from $10-$20. For more information, contact 202-626-3463. See, notice. Location: D.C. Bar Conference Center, 1250 H Street NW, B-1 Level.

Thursday, July 7

10:00 AM. The U.S. Court of Appeals (FedCir) will hear oral argument in Ericsson Inc. v. Harris Corp., No. 04-1444. Location: U.S. Court of Appeals, LaFayette Square, 717 Madison Place, Courtroom 201.

10:00 AM - 12:00 NOON. The Department of State's (DOS) International Telecommunication Advisory Committee (ITAC) will meet to prepare for the Americas Regional Preparatory Meeting for the World Telecommunication Development Conference (WTDC-06) in Lima, Peru, from August 9-11, 2005. See, notice in the Federal Register, June 22, 2005, Vol. 70, No. 119, Page 36224. Location: DOS, Room 2533A.

About Tech Law Journal

Tech Law Journal publishes a free access web site and subscription e-mail alert. The basic rate for a subscription to the TLJ Daily E-Mail Alert is $250 per year. However, there are discounts for subscribers with multiple recipients. Free one month trial subscriptions are available. Also, free subscriptions are available for journalists, federal elected officials, and employees of the Congress, courts, and executive branch. The TLJ web site is free access. However, copies of the TLJ Daily E-Mail Alert are not published in the web site until one month after writing. See, subscription information page.

Contact: 202-364-8882.
P.O. Box 4851, Washington DC, 20008.

Privacy Policy
Notices & Disclaimers
Copyright 1998 - 2005 David Carney, dba Tech Law Journal. All rights reserved.