7/7. President Bush gave a speech at Cabot Microelectronic Corporation, in Aurora, Illinois, in which he discussed innovation and the collection of policy proposals that he titles "American Competitiveness Initiative". He gave a second speech in Chicago, Illinois, in which he discussed foreign investment and free trade.

Bush first announced his competitiveness initiative in his January 31, 2006, speech titled "State of the Union Address". See, story titled "Bush Announces American Competitiveness Agenda" in TLJ Daily E-Mail Alert No. 1,301, February 1, 2006. See also, Bush's speech of February 13, 2006, and story titled "Bush Awards National Medals of Technology and Science" in TLJ Daily E-Mail Alert No. 1,312, February 17, 2006.

Bush said in his July 7 speech in Aurora that "one way to make sure this country is competitive is to enhance math and science in early grades, and encourage people to take math and science in the later years. And there's all kinds of ways to do that. One is to encourage advanced placement programs in our nation's schools, and help train 30,000 teachers in advanced placement. Another is to get people from institutions like this to go into our middle schools and high schools and say, it's okay to be a scientist, you know; math and science will be important for your future. In other words, try to inspire people. We call that an adjunct professor program."

He continued that "We've got a role at the federal government to make sure that we're research oriented in a technology-driven economy, and that is to spend your money on basic research, so that, for example, nanotechnology is a really important part of the economy -- an important growing part of the economy. And I believe, and the Speaker believes -- as a matter of fact the House of Representatives believes that it makes sense to double the basic research budget of our federal government to help companies like this stay on the leading edge of change."

The innovation agendas of House Republicans, House Democrats, and President Bush are quite similar. See, story titled "House Democrats Promote Their Innovation Agenda" in TLJ Daily E-Mail Alert No. 1,312, February 17, 2006.

President Bush also said that "in order for us to be competitive in the future, we've got to emphasize math and science and research and technology."

He also praised Speaker Denny Hastert (R-IL) for bringing to the floor some bills that incorporate parts of his innovation agenda. (Aurora is in the 14th District, which Rep. Hastert represents.) Bush also called upon the Senate to act.

Also on July 7, Bush also gave a speech and answered questions at the Museum of Science and Industry in Chicago, Illinois. See, transcript.

He was asked this: "There's been a lot of mergers with companies in the technology industry, and one of the more recent ones was Lucent Technologies with Alcatel, which is French-owned. How do you feel about a lot of the foreign-owned companies buying out U.S. tech companies, especially those that have military contracts?"

Bush responded that "We have laws that prevent sensitive technologies from being transferred as a result of sale and/or merger. And we watch that very carefully." But, he added, "I have no problem with foreign capital buying U.S. companies; nor do I have a problem with U.S. companies buying foreign companies. That's what free trade is all about."

Bush continued that "A lot of the jobs in America exist as a result of foreign companies investing here in our country. So I believe in opening markets. I do believe in protecting secrets, but we've got laws on the books to prevent secrets from being transferred, or vital technology from being transferred. But I believe in free flows of capital, and I believe in free trade. And that's not a given in the United States. There are people who say, well, we can't compete with China, let's throw up roadblocks, let's protect ourselves. Or, we don't want foreigners coming to invest in our country. I think that would be a mistake. I think that's the early signs of protectionist sentiments, which would mean our economy wouldn't grow."

He added that "if we became isolationist, we would not do our duty to protect the American people and kind of lay the foundations for a better world."

Finally, he remarked that "People say, well, you know, China is too tough to compete with, let's just throw up tariffs. I completely disagree. I think competition is good and healthy. I think it's important to have a competitive world. It means that people are constantly producing a better product and a better service at a better price, which is good for consumers."

On Tuesday, July 11, the House Commerce Committee's (HCC) Subcommittee on Commerce, Trade, and Consumer Protection will hold a hearing titled "CFIUS Reform: HR 5337, the Reform of National Security Reviews of Foreign Direct Investments Act". See, HR 5337 and HCC notice. Also, back on April 27, 2006, the House Financial Services Committee's (HFSC) Subcommittee on Domestic and International Monetary Policy, Trade and Technology held a hearing titled "CFIUS and the Role of Foreign Direct Investment in the United States". See, HFSC web page with hyperlinks to prepared testimony.

6/30. The U.S. Court of Appeals (9thCir) issued its opinion [27 pages in PDF] in Simpson v. AOL, a class action securities fraud case against America Online and others involving the overstatement of revenues of Homestore.com. The District Court dismissed the securities claims. The Court of Appeals affirmed, but remanded to the District Court to allow the plaintiffs to amend their complaint.

This case involves primary violation liability under Section 10(b) of the Securities Exchange Act of 1934, which is codified at 15 U.S.C. § 78j(b). The Supreme Court held in its 1994 opinion in Central Bank of Denver v. First Interstate Bank of Denver, which is reported at 511 U.S. 164, that a private plaintiff may not maintain an aiding and abetting suit under Section 10(b).

In the present case the Court of Appeals held that "the scope of § 10(b) includes deceptive conduct in furtherance of a ``scheme to defraud,´´ when all elements of § 10(b) are otherwise satisfied". The Court of Appeals also concluded "that Plaintiff's complaint insufficiently alleged that Defendants were primary violators of § 10(b) based on their conduct in the furtherance of the scheme", but remanded to the District Court to allow the plaintiffs to amend their complaint.

This case is T. Jeffrey Simpson and California State Teachers Retirement System v. America Online, et al., U.S. Court of Appeals for the 9th Circuit, App. Ct. No. 04-55665, an appeal from the U.S. District Court for the Central District of California, D.C. No. CV-01-11115-MJP, Judge Marsha Pechman presiding. Judge Ronald Gould wrote the opinion of the Court of Appeals, in which Judges Robert Beezer and Thomas Nelson joined.

7/10. The Progress and Freedom Foundation (PFF) released a paper [11 pages in PDF] titled "Beginning to Limit ``Social´´ Regulation of Communications". The author is the PFF's Kyle Dixon.

Dixon was previously a legal advisor to former Federal Communications Commission (FCC) Chairman Michael Powell.

He argues that the focus of the Congress in drafting communications reform legislation is economic regulation. In contrast, social regulation provisions are being added to the legislation, but the topic is not being addressed in a coherent fashion.

He argues for limited social regulation. He also argues that the FCC's current powers (forbearance and biennial reviews) for limiting outmoded social regulation are inadequate. He offers suggestions for how the Congress might add to its legislation a provision that would institute processes to be followed by the FCC that might prompt the FCC to eliminate social policy mandates as they become outmoded.

He writes that in the Senate's ongoing consideration of communications reform legislation, there is an "absence of any coherent framework governing attempts by regulators to pursue various ``social´´ goals, such as universal service, ``911´´ emergency service and access by persons with disabilities."

He argues that "Current legislative proposals read, instead, like ``laundry lists´´ held together by naked (or tacit) political judgments. By leaving many of the objectives and interrelationships of social regulation inchoate, legislators make the reform process needlessly uncertain, while sacrificing the benefit of focused input on these issues by academics and other technical experts. And this, in turn, makes it harder for thoughtful policymakers to ensure that proposed social obligations do more good than harm."

He states that the Congress, in enacting the Telecommunications Act of 1996, "failed to anticipate the degree to which companies that did not compete historically would enter each others' markets using flexible Internet protocol technologies. The Act merely continued the distinct regulatory treatment afforded each type of company -- telephone, cable, broadcast, etc. The Act thereby frustrated attempts to reconcile disparities among the regulation of increasingly similar, competing services." And now, writes Dixon, the Congress is focusing solely on the economic regulation.

He argues that while "Pursuing social goals through regulation is not always or necessarily a bad thing", there can be pitfalls to social regulation. He argues, among other things, that market competition and innovation often benefit consumers more than regulation, that regulation often inhibits investment, and that some incumbent companies "may be more adept at shaping how rules are written to minimize their own burdens while maximizing those of their competitors". He elaborates that the new IP based services companies "often are no match for traditionally-regulated companies when it comes to the day-in, day-out minutiae of monitoring, influencing and ultimately complying with the actions of administrative agencies."

He also argues that the forbearance and biennial review provisions of Sections 10 and 11 of the 1996 Act are inadequate "to serve as a meaningful spur to regulators to eliminate social policy mandates as economic and technological forces obviate such mandates".

Hence, he offers suggestions for how the Congress might direct the FCC to deal with such social policy mandates. He suggests that the Congress direct the FCC to periodically re-examine the goals of regulation and how they derive them from statute, identify trade-offs among policy goals, and reconsider whether mandates are necessary, formulate actions to eliminate unnecessary rules, and justify implementation by the FCC (as opposed to some other agency).

7/10. The Senate Finance Committee (SFC) approved the nomination of Henry Paulson (at right) to be Secretary of the Treasury on June 28, 2006. The Senate confirmed Paulson on June 28. Paulson took the oath of office on July 10. President Bush spoke at a White House ceremony. He said that "Hank Paulson will be my leading policy advisor on a broad range of domestic and international economic issues, and he will be the principal spokesman for my administration's economic policies." Bush also said that "we will work to open up new markets to American products, and to ensure that our trading partners play by the rules and respect intellectual property rights, and maintain market-based exchange rates for their currencies." Bush also said that one "challenge is to keep America competitive by fostering a spirit that rewards innovation and risk-taking and enterprise. America is the most innovative nation in the world because our free enterprise system unleashes the talent and creativity of our people." See, transcript.

7/10. The Government Accountability Office (GAO) released a letter report [7 pages in PDF] to the Chairmen and ranking Democrats on the Senate Banking Committee and the House Financial Services Committee. This letter is titled "LOCAL Television Act: Status of Spending for Fiscal Year 2005". This act created the Local Television Loan Guarantee Program. The letter states that "Since inception of the program, no loan guarantees have been approved and there are no current or anticipated budgetary resources available for future loan guarantees. On December 13, 2004, the board authorized closing out one of two existing contracts. The other contract expired on December 31, 2005. Fiscal year 2005 administrative costs totaled about $6,500. Given that the President’s Budgets for Fiscal Years 2006 and 2007 both pointed out that the unobligated budget authority for this program had been rescinded and the administration was not proposing additional funds for this program, we reiterate our previous matter for congressional consideration to rescind the balance of the appropriation for administrative expenses."

7/9. The New York Times (subscription required) wrote in its July 9, 2006, issue that on May 18, 2006, Rep. Pete Hoekstra (R-MI), the Chairman of the House Intelligence Committee, sent a letter to President Bush regarding the administration's failure to keep Congressional intelligence committees informed of intelligence activities. Rep. Hoekstra also discussed the subject on television interview program titled "Fox News Sunday". See, Fox story.

7/7. The Progress and Freedom Foundation (PFF) released a short essay titled "Seeking Détente: Cablevision and the Content Industry". The author is the PFF's Patrick Ross.

7/3. The National Institute of Standards and Technology's (NIST) Computer Security Division released its Draft Special Publication 800-78-1 [22 pages in PDF], titled "Cryptographic Standards and Key Sizes for Personal Identity Verification". The deadline to submit comments is 5:00 PM on October 2, 2006.

6/28. The New York University School of Law's Brennan Center for Justice released a report [32 pages in PDF] titled "The Machinery of Democracy: Protecting Elections in An Electronic World". It analyses the security vulnerabilities in the three most commonly purchased electronic voting systems. It concludes that all have vulnerabilities.

The House will return from its Independence Day recess at 2:00 PM. 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 return from its Independence Day recess at 2:00 PM. It will begin consideration of HR 5441, the homeland security appropriations bill.

8:30 AM - 5:00 PM. The Intellectual Property Owners Association (IPO) will host a day long conference titled "Demystifying §337 Investigations at the ITC". For more information, contact Clara Stanfield at cstanfield at ipo dot org or 202- 466-2396. See, notice and brochure [PDF]. Location: Ronald Reagan Building & International Trade Center.

10:00 AM. The U.S. Court of Appeals (FedCir) will hear oral argument in Action Gaming, Inc. v. Alliance Gaming Corp., a patent infringement case involving computer gambling technology. This is App. Ct. No. 2005-1287, an appeal from the U.S. District Court (DNev). See, December 8, 2004 release. Location: Courtroom 201, 717 Madison Place, NW.

5:00 PM. The House Rules Committee will meet to adopt rules for consideration of HR 2990, the "Credit Rating Agency Duopoly Relief Act of 2006" and HR 4411, the "Unlawful Internet Gambling Enforcement Act of 2006". Location: Room H-313, Capitol Building.

Deadline to submit comments to the National Telecommunications and Information Administration (NTIA) in response to its notice of inquiry (NOI) regarding "implementation of the Spectrum Sharing Innovation Test-Bed (Test-Bed) where Federal and non-Federal users can study the feasibility of increasing the efficient use of the spectrum". See, notice in the Federal Register, June 8, 2006, Vol. 71, No. 110, at Pages 33282-33284.

Deadline to submit comments to the Antitrust Modernization Commission (AMC) regarding any topic related to the AMC's study. See, notice in the Federal Register, June 15, 2006, Vol. 71, No. 115, at Pages 34590-34591.

Deadline to submit comments to the Federal Trade Commission (FTC) regarding the proposed consent agreement with Take-Two Interactive Software, Inc. and Rockstar Games, Inc. This pertains to the alleged deceptive representations in advertising and on product packaging concerning the content in the video game named "Grand Theft Auto: San Andreas". See, notice in the Federal Register, June 15, 2006, Vol. 71, No. 115, at Pages 34620-34621.

The House will meet at 9:00 AM for morning hour, and at 10:00 AM for legislative business. It will consider HR  5646, a bill to require that the Environmental Protection Agency (EPA) study and promote the use of energy efficient computer servers. See, Republican Whip Notice.

10:00 AM. The House Financial Services Committee will hold a hearing titled "The Terror Finance Tracking Program". The witnesses will include Stuart Levey, Under Secretary for Terrorism and Financial Intelligence at the Department of the Treasury. Location: Room 2128, Rayburn Building.

10:00 AM. The House Commerce Committee's (HCC) Subcommittee on Telecommunications and the Internet will hold a hearing on HR 5319, the "Deleting Online Predators Act of 2006". The witnesses will be Greg Abbott (Texas Attorney General), Michelle Collins (National Center for Missing and Exploited Children), Amanda Lenhart (Pew Internet and American Life Project), Beth Yoke (ALA Young Adult Library Services Association), Ted Davis (Fairfax County Public Schools), Parry Aftab (WiredSafety.org), Chris Kelly (Facebook), and David Zellis (Office of the Bucks County District Attorney). See, notice. Location: Room 2123, Rayburn Building.

12:00 NOON - 2:00 PM. The DC Bar Association will host a panel discussion titled "The Supreme Court: The View from the Press Gallery". The speakers will include Joan Biskupic (USA Today), Charles Lane (Washington Post), Tony Mauro (Legal Times and American Lawyer Media), David Savage (Los Angeles Times), and Stuart Taylor (National Journal and Newsweek). The price to attend ranges from $15-$35. For more information, call 202-626-3463. See, notice. Location: Arnold & Porter, 555 12th Street, NW.

2:00 PM. The House Commerce Committee's (HCC) Subcommittee on Commerce, Trade, and Consumer Protection will hold a hearing titled "CFIUS Reform: HR 5337, the Reform of National Security Reviews of Foreign Direct Investments Act". See, HR 5337 and HCC notice. Location: Room 2123, Rayburn Building.

2:15 PM. The Senate Judiciary Committee (SJC) may hold a hearing on judicial nominations. The SJC frequently cancels or postpones hearings without notice. Press contact: Courtney Boone at 202-224-5225. See, notice. Location: Room 226, Dirksen Building.

POSTPONED. 2:30 PM. The Senate Homeland Security and Governmental Affairs Committee's Subcommittee on Federal Financial Management, Government Information, and International Security will hold a hearing titled "Cyber Security: Recovery and Reconstitution of Critical Networks". See, notice. Location: Room 342, Dirksen Building.

Deadline to submit initial comments to the Copyright Office regarding its proposal to amend its rules governing the submission of royalty fees to the Copyright Office to require such payments to be made by electronic funds transfer. See, notice in the Federal Register, April 27, 2006, Vol. 71, No. 81, at Pages 24829-24831.

The House will meet at 10:00 AM for legislative business. It may consider HR 4411, the "Unlawful Internet Gambling Enforcement Act of 2006". See, Republican Whip Notice.

9:00 AM. The U.S. District Court (DC) will hold a motion hearing in USA v. SBC. Judge Sullivan will preside. This case is U.S.A. v. SBC Communications, et al., D.C. No. 1:05CV02102 (EGS). See also, the Department of Justice's (DOJ) web page with hyperlinks to its pleadings in this case. Location: Courtroom 24A, 333 Constitution Ave., NW.

10:00 AM. The Senate Finance Committee will hold a hearing on S 3495, a bill to authorize the extension of nondiscriminatory treatment (normal trade relations treatment) to the products of Vietnam. See, notice. Location: Room 215, Dirksen Building.

10:00 AM. The House Judiciary Committee will meet to mark up several bills. The agenda does not include any technology related bills, but bills may be added to the agenda. See, notice. Press contact: Jeff Lungren or Terry Shawn at 202-225-2492. Location: Room 2141, Rayburn Building.

10:30 AM. The House Ways and Means Committee will hold a hearing titled "Implementation of the United States-Peru Trade Promotion Agreement". See, notice. Press contact: 202- 225-1721. Location: Room 1100, Longworth Building.

10:30 AM. The Senate Banking Committee will hold a hearing on several pending nominations, including that of Frederic Mishkin to be a member of the Board of Governors of the Federal Reserve System. See, notice. Location: Room 538, Dirksen Building.

12:15 PM. The Federal Communications Bar Association's (FCBA) Mass Media Practice Committee will host a brown bag lunch. Andrew Cotlar (Associate General Counsel of the Association of Public TV Stations) will speak on public broadcasting in the US. For more information, contact Robert Rini at rrini at rinicoran dot com or 202-463-4301. Dial-In Information: 1-866-443-4185, participant code #31665. Location: Sheppard Mullin, 1300 I Street, NW, 11th Floor.

12:30 PM. Sen. Arlen Specter (R-PA) will give a speech. Location: National Press Club, 529 14th St. NW, 13th Floor.

The calendar for the U.S. Court of Appeals (FedCir) states that it will consider, on the briefs, Eolas Technologies v. Microsoft. This is App. Ct. No. 2006-1238.

The House will meet at 10:00 AM for legislative business. It may consider HR 4411, the "Unlawful Internet Gambling Enforcement Act of 2006". See, Republican Whip Notice.

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

9:30 AM - 5:30 PM. The Antitrust Modernization Commission (AMC) will hold a meeting to deliberate on possible recommendations regarding the antitrust laws to Congress and the President. The meeting is open to the public, but registration is required. See, notice in the Federal Register, June 23, 2006, Vol. 71, No. 121, at Page 36059. Location: Morgan Lewis, main conference room, 1111 Pennsylvania Ave., NW.

10:00 AM. The Senate Finance Committee will hold a hearing on the nomination of Eric Solomon to be Assistant Secretary of the Treasury for Tax Policy. Location: Room 215, Dirksen Building.

10:00 AM. The Senate Homeland Security and Governmental Affairs will hold a hearing on the nomination of Eric McMillin to be Deputy Director of the Office of Management and Budget (OMB). See, notice. Location: Room 342, Dirksen Building.

10:30 AM. The House Ways and Means Committee's Subcommittee on Select Revenue Measures will hold a hearing titled "Issues Relating to the Patenting of Tax Advice". See, notice. Location: Room B-318, Rayburn Building.

12:00 NOON - 2:00 PM. The Alliance for Public Technology (APT) will host a brown bag lunch titled "Preemption of State Wireless Regulation: Where Do Consumers Fit In?". The speakers will be Brian Fontes (Cingular) and Dane Snowden (CTIA). RSVP to apt at apt dot org or 202-263-2970. Location: 919 18th St., NW, 10th Floor Conference Room.

2:00 - 5:00 PM. The Center for Democracy and Technology (CDT) and the Congressional E-9-1-1 Caucus will host a demonstration titled "Emergency Communications Services Tech Fair". See, notice. There will also be a reception at 5:00 - 7:00 PM. Location: Rayburn Foyer, Rayburn Building, Capitol Hill.

2:30 PM. The Senate Commerce Committee (SCC) will hold a hearing titled "Unmanned Aerial Systems in Alaska: A Framework for the Nation". Sen. Ted Stevens (R-AK) will preside. See, notice. Location: Room 562, Dirksen Building.

TIME? The Board of Directors of the American Intellectual Property Law Association (AIPLA) will meet. Location: AIPLA, Headquarters Board Room, Arlington, VA.

6:00 - 9:15 PM. The DC Bar Association will host a continuing legal education (CLE) seminar titled & "Antitrust Investigations: Tactical and Ethical Issues". The speakers will include Ray Hartwell (Hunton & Williams), Kathryn Fenton (Jones Day), Donald Klawiter (Morgan Lewis & Bockius), Ann Marie O’Brien (Antitrust Division). The price to attend ranges from $70-$125. For more information, call 202-626-3488. See, notice. Location: D.C. Bar Conference Center, 1250 H Street NW, B-1 Level.

The Republican Whip Notice states that there are no votes expected in the House.

5:00 PM. Deadline to submit comments to the Office of the U.S. Trade Representative (USTR) regarding its special provincial review (SPR) of intellectual property rights (IPR) protection in Peoples Republic of China (PRC). See, notice in the Federal Register, June 16, 2006, Vol. 71, No. 116, at Pages 34969-34970.

6:00 PM. Deadline for upfront payments for the Federal Communications Commission's (FCC) Auction 66. This is the auction of Advance Wireless Services (AWS) licenses in the 1710-1755 MHz and 2110-2155 MHz (AWS-1) bands. See also, notice in the Federal Register, June 2, 2006, Vol. 71, No. 106, at Pages 32089-32091.

Deadline to submit initial comments to the Federal Communications Commission (FCC) in response to its Further Notice of Proposed Rulemaking (FNPRM) regarding whether and how an open global database of proxy numbers of Video Relay Service (VRS) users may be created so that a hearing person may call a VRS user through any VRS provider without having to ascertain the first VRS user's current internet protocol address. See, notice in the Federal Register, May 31, 2006, Vol. 71, No. 104, at Pages 30848-30856. This FNPRM is FCC 06-57 in CG Docket No. 03-123.

Deadline to submit reply comments to the Federal Communications Commission (FCC) in response to its further notice of proposed rulemaking (FNPRM) regarding telecommunications relay services (TRS) and speech to speech services for individuals with hearing and speech disabilities, and misuse of internet protocol relay service and video relay service. This item is FCC 06-58 in CG Docket No. 03-123. See, notice in the Federal Register, June 1, 2006, Vol. 71, No. 105, at Pages 31131-31137.

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