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July 27, 2006, Alert No. 1,419.
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7th Circuit Rules in Antitrust and Patent Case

7/26. The U.S. Court of Appeals (7thCir) issued its opinion [12 pages in PDF] in Schor v. Abbott Laboratories, an antitrust case involving a drug patent in which the Court of Appeals affirmed the judgment of the District Court, dismissing the complaint for failure to state a claim.

The Court of Appeals rejected a "monopoly leveraging" claim where the defendant held a patent monopoly on a drug. However, in reaching this conclusion, the Court of Appeals provided not only economic analysis and judicial precedent, but also an analogy to the computer and software industries.

This case involves Abbott Laboratories' sale of protease inhibitors, which are drugs that inhibit the progress of the human immunodeficiency virus (HIV) which causes the acquired immune deficiency syndrome (AIDS).

Abbott holds U.S. Patent No. 5,886,036 for the drug ritonavir, which it sells under the brand name Norvir. It also holds U.S. Patent No. 6,037,157 for ritonavir taken in combination with any protease inhibitor. Abbott also sells a drug under the brand name Kaletra that includes ritonavir plus the protease inhibitor lopinavir.

That is, Abbott sells ritonavir both as part of Kaletra, and alone as Norvir.

Gary Schor is a class action plaintiff who seeks to represent a class of everyone who uses protease inhibitors.

Schor filed a complaint in U.S. District Court (NDIll) against Abbott alleging violation of Section 2 of the Sherman Act, which is codified at 15 U.S.C. ß 2.

Section 2 provides, in full, that "Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States, or with foreign nations, shall be deemed guilty of a felony, and, on conviction thereof, shall be punished by fine not exceeding $10,000,000 if a corporation, or, if any other person, $350,000, or by imprisonment not exceeding three years, or by both said punishments, in the discretion of the court."

The Court of Appeals offered this summary of Schor's complaint. "He argues that Abbott charges too much for Norvir alone and too little for the Norvir component of Kaletra. ... the disparity between the unduly high price of Norvir and the unduly low price of Kaletra is designed to monopolize the market in protease inhibitors, in violation of ß2 of the Sherman Act, 15 U.S.C. ß2. Schor calls the strategy ďmonopoly leveragingĒ: Abbott is trying to use its patent to obtain a monopoly of all protease inhibitors by inducing HIV patients to buy Kaletra, which will lead other vendors to drop out of the market. Once rivalsí products have been vanquished, Abbott will be able to jack up the price of Kaletra as well as Norvir."

The District Court dismissed the complaint for failure to state a claim.

The Court of Appeals affirmed. Judge Frank Easterbrook wrote the opinion for the unanimous three judge panel.

The Court of Appeals wrote that "Schor's complaint does not allege any of the normal exclusionary practices --tie-in sales (or another form of bundling), group boycotts, exclusive dealing and selective refusal to deal, or predatory pricing. Abbott sells ritonavir as part of Kaletra, but this is not a tie-in because ritonavir is available separately as Norvir. Abbott will sell to anyone willing to pay its price: there is no refusal to deal." (Parentheses in original.)

It continued that "The price of Norvir cannot violate the Sherman Act: a patent holder is entitled to charge whatever the traffic will bear. This is true of both Norvir's price ... and of a claim that the patent holder has engaged in price discrimination by cutting ritonavirís price to people who buy it (through Kaletra) in combination with lopinavir." (Parentheses in original.)

The Court of Appeals, citing the Supreme Court's 2004 opinion [22 pages in PDF] in Verizon v. Trinko, added that "antitrust law does not require monopolists to cooperate with rivals by selling them products that would help the rivals to compete. ... Cooperation is a problem in antitrust, not one of its obligations."

This opinion is also published at 540 U.S. 398. See also, story titled "Supreme Court Holds That There is No Sherman Act Claim in Verizon v. Trinko" in TLJ Daily E-Mail Alert No. 815, January 14, 2004.

The Court wrote in the present case "The basic point is that a firm that monopolizes some essential component of a treatment (or product or service) can extract the whole monopoly profit by charging a suitable price for the component alone. If the monopolist gets control of another component as well and tries to jack up the price of that item, the effect is the same as setting an excessive price for the monopolized component. The monopolist can take its profit just once; an effort to do more makes it worse off and is self-deterring." (Parentheses in original.)

"The monopolist's profit-maximizing strategy is not to take over the market in related products (ritonavir and other protease inhibitors are complements, not substitutes, given the bad side effects when ritonavir is used alone) but to promote competition among the other producers. The less the complements cost, the more the monopolist can charge for its own product." (Parentheses in original.)

It then compared the facts of this case to computers and software. "Thus Microsoft does not make computers but encourages vigorous competition among Dell, Hewlett-Packard, Sony, Lenovo, and other participants in that market; the less it costs to buy the hardware, the more sales of operating system software there will be and the more Microsoft can charge. Similarly Abbott hopes that competition among other drug manufacturers will drive down the price of protease inhibitors; the less they cost, the more Abbott can charge for Norvir (or the ritonavir component in Kaletra). There's no reason to think that Abbott would be better off if it took over the market in protease inhibitors and tried to charge a monopoly price for substances that complement ritonavir." (Parentheses in original.)

The Court of Appeals also wrote that the 9th Circuit, which recognized a monopoly leveraging claim in Image Technical Services, Inc. v. Eastman Kodak Co., 125 F.3d 1195 (1997), "just got it wrong". The Supreme Court denied certiorari in that case, at 523 U.S. 1094 (1998).

This case is Gary Schor v. Abbott Laboratories, U.S. Court of Appeals for the 7th Circuit, App. Ct. No. 05-3344, an appeal from the U.S. District Court for the Northern District of Illinois, Eastern Division, D.C. No. 05 C 1592, Judge Robert Gettleman presiding. Judge Frank Easterbrook wrote the opinion of the Court of Appeals, in which Judges Manion and Sykes joined.

Negotiators Trade Accusations About Collapse of Doha Talks

7/27. The Office of the U.S. Trade Representative (USTR) continues to state that it will pursue Doha trade talks, following the World Trade Organization's (WTO) suspension of talks on July 24, 2006.

The Office of the USTR announced in a release on July 26 that USTR Susan Schwab will travel to Brazil on July 27 through 29. Schwab stated in this release that "The spirit of Doha lives even if a formal agreement eludes us at this time."

A successful conclusion of Doha talks has the potential to benefit technology and communications in many ways. However, the recent failed negotiations, and recriminations, have focused on agriculture. The flurry of speeches, statements, and accusations that has followed the collapse of negotiations is largely devoid of discussion of the tech related lost opportunities.

Susan SchwabSchwab (at left) stated in a speech on July 24 the the U.S. "remains determined to work with other Members to see the completion of an ambitious Doha agreement -- one that opens markets for agricultural and manufactured goods, as well as services. One that effectively disciplines trade distorting subsidies. And one that reflects many of the other interests associated with the single undertaking. Others may sound willing to walk away."

"The United States remains committed to the promise of the Doha Round and to the World Trade Organization and the multilateral system." She added, quoting President Bush, that "the United States is ready to eliminate all tariffs, subsidies and other barriers to free flow of goods and services as other nations do the same."

Trade negotiators and other government officials have traded accusations of blame.

For example, Peter Mandelson, the European Commissioner for Trade, gave a speech on July 25 in which stated that suspension of the Doha talks "is deeply regrettable, disappointing and it could have been avoided. This is not just another missed deadline. It is a major missed opportunity, with serious systemic implications for multilateral trade."

Peter MandelsonMandelson (at right) criticized the U.S. role. He said that "the United States, I regret to say, showed no flexibility at all in the end on the issue of domestic subsidies in agriculture. I regret this, although I do understand the domestic political considerations which influenced the United Statesí negotiating position. As a result, the United States have been asking too much from others in exchange for doing too little themselves. This is not my definition of leadership. And now, the United States seems to be saying to the rest of the world: ``we are right, you are isolatedīī."

He added that "The costs of this breakdown are high -- and will be even higher if it becomes permanent. As Pascal Lamy said yesterday, we are all losers. Let me remind you exactly what risks being lost: real cuts in tariffs in industry and agriculture in all developed and most large developing countries and thus a major boost to world trade; Duty Free Quota Free access to rich countriesí markets for the poorest. Greater investment, and choice in the provision of services, which are the backbone of modern economies; an ambitious agreement on trade facilitation, to reduce what is today a high tax on world trade flows. And, more importantly than any of the above, consolidation of a programme of fundamental reforms of farm subsidies in the rich world - something that ultimately only the WTO can deliver."

He concluded that "Doha will remain a central priority of European trade policy. We will work to bring it back to life and to success."

See also, EU release, which states that "it is clear that the principal reason for this failure lies at the door of the United States, whose lack of flexibility over reducing farm subsidies proved a deal-breaker."

The Office of the USTR issued a statement on July 25 that stated that "yesterday's statement by the European Union alleging that the United States failed to show flexibility in the Doha agriculture negotiations and attempting to divert blame for the stalemate is false and misleading. It cannot stand uncorrected."

The U.S. statement continues that "Ten months ago, the United States put forward the most bold agriculture proposal advanced to date to cut both tariffs and trade-distorting domestic supports. The proposal would have required substantial reform of the agricultural sectors in the U.S. and the EU -- which has average agricultural tariffs twice those in the US and domestic supports three times greater than the U.S. -- as well as greater opening of the fast-growing advanced developing economies."

Schwab also rebutted EU accusations. She said in a July 24 news conference that "the finger-pointing canít hide the fact that their average agriculture tariffs are twice as high as ours and that their farm subsidies are more than three times what ours are. So they have not been a profile on political courage here." See, transcript.

She elaborated. "Iíll just give you one quick example. Around the world many countries raise beef, therefore selling beef into a marketplace is very important. The current tariff for high quality beef in the European Union is 80 percent. With the tariff proposal out there, their new tariff would be 61 percent, so still a very very high tariff. They also indicated that they would likely designate this product as a sensitive product which means that they would put in place a TRQ. So we got to probing about how much beef was that? How much beef would the world be able to sell into the European Union? The answer to that was 160,000 metric tons. Thatís about two percent of their marketplace. That is virtually no market access. ... So it truly is a situation where we havenít been granted market access."

Schwab also criticized developing countries, including China, Brazil and Korea. She said that their proposal "basically says that they would have the right to protect 95 to 98 percent of their ag marketplace. Ninety-five to 98 percent in the growing economies of the world, they would have the ability under their proposal to say when they would deal with us, how they would deal with us, what products they would deal with us on. It just is a devastating proposal in terms of market access. It basically gives the developing countries a pass on market access."

See also USTR release and release [PDF] of July 24.

Pascal LamyPascal Lamy (at right), Director General of the WTO, gave a speech on July 24, 2006. He said that "From the discussions over this weekend, it is clear that the main blockage is on the Agriculture legs of the triangle of issues the G6 has been trying to address. Despite some improvement on numbers which were informally floated and in particular on market access for developed countries, the gap in level of ambition between market access and domestic support remained too wide to bridge. This blockage was such that the discussion did not even move on to the third leg of the triangle -- market access in NAMA." NAMA is non-agriculture market access.

He added that "The situation is now very serious. Without the modalities in Agriculture and NAMA, it is now clear that it will not be possible to finish the Round by the end of 2006."

Schwab also stated at her news conference of July 24 that "And only by completing the Doha Round negotiations by the end of 2006 would the agreement be ready in time for us to use Trade Promotion Authority before it expires on July 1, 2007. At this stage of the game we do not expect to be able to use the current TPA authority to enact a Doha Round agreement if and when one comes together."

Schwab was praised by U.S. legislators, particularly those with agricultural constituencies.

Sen. Max Baucus (D-MT), the ranking Democrat on the Senate Finance Committee (SFC), stated in a release on July 24 that ""It is unfortunate that negotiators were unable to bridge differences in the Doha talks. These negotiations had great potential to open new markets for Montana's and America's farmers and ranchers, as well as for our exporters of industrial goods and services."

But, he added, "no Doha deal is better than a bad Doha deal. It has become increasingly apparent that our trading partners -- especially the European Union and certain advanced developing countries -- are unwilling to offer meaningful access to their markets, especially for U.S. agricultural exports. Instead, these countries appear to believe that negotiations are one-way, expecting the United States to unilaterally disarm even as they seek to shelter their own markets from serious trade commitments. That is unacceptable."

Sen. Max BaucusSen. Baucus (at right) said that "Ambassador Schwab was right to hold firm and accept nothing less than real concessions. I commend her for her resolve."

He concluded that "Now that the clock has run out on Doha, it is time for the United States to turn its attention to trading partners and trade agreements from which we can derive results. Between now and the expiration of Trade Promotion Authority next year, we should focus on deliverables we can achieve -- like granting Vietnam Permanent Normal Trade Relations status, completing free trade agreement negotiations with Korea and Malaysia, and deepening our trade links with willing partners in East and Southeast Asia."

Sen. Charles Grassley (R-IA), the Chairman of the SFC, stated in a release [PDF] that "Iím very disappointed. And I wonder whether our trading partners truly appreciate how much we stand to lose if this round fails. The poorest developing countries have the most to gain from a successful round. And success rests on creating real market access opportunities. Unfortunately, too many of our trading partners have just been unwilling to allow enough market access. Iíve always said that no deal is better than a bad deal, and a ĎDoha liteí deal would be a bad deal. Iím glad our trade negotiators held their ground. They appreciate that lesser ambition doesnít serve our interests, and itís not in the best interest of the global trading community. Iím also frustrated that two of our more vocal critics, the EU and India, are also two of the biggest advocates of maintaining protectionist policies in the WTO negotiations. As long as they wear their blinders, weíll never see eye-to-eye on a good trade deal, and poorer countries will pay the highest price."

Rep. Roy Blunt (R-MO), the House Majority Whip, stated in a release that Schwab told him "that she would not come home with a bad deal and, as big a disappointment as this was, I know she fulfilled that promise."

He added that "What is clear from the temporary collapse of these trade talks is that America's trading partners are just not willing to make the concessions and difficult decisions that are required to reduce global trade barriers. It is a shame, because those difficult decisions are exactly what are required to produce the kind of global economic growth that will help lift people around the world out of poverty."

He concluded that "Today's news is a major setback for the Doha agenda, but it is not the end of the road. I urge the administration to continue its efforts, as I know it will, to engage closely with our trading partners to produce the right deal for American farmers and our economy as a whole."

Washington Tech Calendar
New items are highlighted in red.
Thursday, July 27

The House will meet at 10:00 AM for legislative business. The House will consider HR 4157, the "Health Information Technology Promotion Act of 2005", subject to a rule. See, Republican Whip Notice.

The Senate will meet at 9:30 AM. It will begin consideration of S 3711, the Gulf of Mexico energy security bill.

9:00 AM. The House Judiciary Committee's Subcommittee on Courts, the Internet and Intellectual Property will hold a hearing on HR 5055, an untitled bill to amend the Copyright Act to provide to protection for fashion design. See, notice. Press contact: Jeff Lungren or Terry Shawn at 202-225-2492. Location: Room 2141, Rayburn Building.

9:00 AM - 4:00 PM. Day one of a two day public meeting of the Federal Accounting Standards Advisory Board (FASAB). See, agenda [PDF] and notice in the Federal Register, July 12, 2006, Vol. 71, No. 133, at Pages 39318. Location: Room 7C13, GAO Building, 441 G St., NW.

10:45 AM. The Senate Judiciary Committee (SJC) may hold an executive business meeting. The agenda includes consideration of the nominations of Kimberly Moore to be a Judge of the U.S. Court of Appeals for the Federal Circuit, and Steven Bradbury to be Assistant Attorney General in charge of the Office of Legal Counsel. The agenda also includes consideration of S 2453, the "National Security Surveillance Act of 2006", S 2455, the "Terrorist Surveillance Act of 2006", S 2468, a bill to provide standing for civil actions for declaratory and injunctive relief to persons who refrain from electronic communications through fear of being subject to warrantless electronic surveillance for foreign intelligence purposes, S 3001, the "Foreign Intelligence Surveillance Improvement and Enhancement Act of 2006", S 2831, the "Free Flow of Information Act of 2006", and S 1845, the "Circuit Court of Appeals Restructuring and Modernization Act of 2005". See, notice. The SJC frequently cancels or postpones meetings without notice. The SJC rarely follows its published agenda. Press contact: Courtney Boone at 202-224-5225. Location: Room 226, Dirksen Building.

10:00 AM. The Senate Finance Committee will meet to review and make recommendations on proposed legislation implementing the U.S.-Peru Trade Promotion Agreement, and to consider favorably reporting S 3495, a bill to authorize the extension of nondiscriminatory treatment (normal trade relations treatment) to the products of Vietnam. Location: Room 215, Dirksen Building.

10:00 AM. The Senate Commerce Committee will host a brief by Jack Valenti (former head of the MPAA) regarding an industry initiative to inform and educate consumers on television blocking technology through public service announcements (PSAs). Location: Room 253, Russell Building.

10:30 AM. The House Judiciary Committee's Subcommittee on Courts, the Internet and Intellectual Property will meet to mark up HR 5418, an untitled bill "To establish a pilot program in certain United States district courts to encourage enhancement of expertise in patent cases among district judges." See, notice. Press contact: Jeff Lungren or Terry Shawn at 202-225-2492. Location: Room 2141, Rayburn Building.

10:30 AM. Robert Mocny, acting Director of the Department of Homeland Security's US-VISIT, will provide an update on future enhancements to US-VISIT. Location: Room 1890, 1616 N. Fort Myer Drive, Arlington, VA.

11:00 AM. The Senate Commerce Committee will to consider several nominations, including Nathaniel Wienecke to be the Department of Commerce's Assistant Secretary for Legislative and Intergovernmental Affairs, and Jay Cohen to be the Department of Homeland Security's Under Secretary for Science and Technology. See, notice. Press contact: Joe Brenckle (Stevens) at 202-224-3991, Brian Eaton (Stevens) at 202-224-0445, or Andy Davis (Inouye) at 202-224-4546. Location: Room 253, Russell Building.

11:45 AM - 1:15 PM. The Federal Communications Bar Association's (FCBA) Young Lawyers Committee will host a brown bag lunch titled "The Role of Communications Trade Association Counsel and Policymakers". The speakers will be Dan Brenner (National Cable & Telecommunications Association), Carolyn Brandon (Cellular Telecommunications & Internet Association), Ann Bobeck (National Association of Broadcasters), Colin Sandy (National Exchange Carriers Association), and David Cavossa (Satellite Industry Association). Location: Willkie Farr & Gallagher, 1875 K Street, NW.

3:00 PM. The House Rules Committee will meet to adopt a rule for consideration of HR 4157, the "Health Information Technology Promotion Act of 2005". Location: Room H-313, Capitol Building.

6:00 - 8:00 PM. The DC Bar Association will host a continuing legal education (CLE) seminar titled "Trade Secrets: Case Law Update 2006". The speakers will include Milton Babirak (Babirak Vangellow & Carr). 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.

Friday, July 28

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

9:30 AM. 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". The witnesses will be George Foresman (DHS's Under Secretary for Preparedness), Richard Schaeffer (NSA's Director of Information Assurance), Karen Evans (OMB), David Powner (GAO), Tom Noonan (ISS), Roberta Bienfait (AT&T), Michael Aisenberg (Verisign), Karl Brondell (State Farm, for the Business Roundtable). See, notice. Location: Room 342, Dirksen Building.

Monday, July 31

The House will not meet from Monday, July 31 (tentative), through Monday, September 4. See, Majority Whip's calendar.

Deadline to submit comments to the National Institute of Standards and Technology (NIST) regarding NIST Special Publication 800-53A [305 pages in PDF], titled "Guide for Assessing the Security Controls in Federal Information Systems".

Deadline to submit reply comments to the Federal Communications Commission (FCC) in response to its Further Notice of Proposed Rulemaking (FNPRM) regarding on 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.

Extended deadline to submit comments to the U.S. Patent and Trademark Office (USPTO) in response to its notice in the Federal Register regarding revisions to guidelines used by USPTO personnel in their review of patent applications to determine whether the claims in a patent application are directed to patent eligible subject matter. The USPTO seeks comments on, among other topics, "claims that perform data transformation" and "claims directed to a signal per se". With respect to the later, the USPTO asks "If claims directed to a signal per se are determined to be statutory subject matter, what is the potential impact on internet service providers, satellites, wireless fidelity (WiFi [reg]), and other carriers of signals?" See, Federal Register, December 20, 2005, Vol. 70, No. 243, at Pages 75451 - 75452. See also, story titled "USPTO Seeks Comments on Subject Matter Eligible for Patents" in TLJ Daily E-Mail Alert No. 1,278, December 22, 2005. See also, notice in the Federal Register (June 14, 2006, Vol. 71, No. 114, at Pages 34307-34308) extending deadline, and story titled "USPTO Seeks Further Comments on Patentable Subject Matter" in TLJ Daily E-Mail Alert No. 1,391, June 14, 2006.

Tuesday, August 1

LOCATION CHANGE. 9:00 AM. The Senate Homeland Security and Governmental Affairs Committee's Subcommittee on Investigations will hold a hearing titled "Offshore Abuses: The Enablers, The Tools & Offshore Secrecy". This hearing will focus on the use of foreign financial services companies by U.S. citizens, but not the use of U.S. financial services companies by foreign citizens. See, notice. Location: Room 106, Dirksen Building.

10:00 AM. The National Association of Manufacturers (NAM) will host an event to release a report on supply chain security. The speakers will include Jerry Jasinowski (NAM), Theo Fletcher (IBM), Lesley Sept (Stanford University), and Arnold Allemang (Dow Chemical Company). For more information, contact Laura Narvaiz at 202-637-3104 or lnarvaiz at nam dot org. Coffee and doughnuts will be served. Location: NAM, 1331 Pennsylvania Ave., NW, Suite 600.

Wednesday, August 2

9:45 AM - 12:00 NOON and 2:00 - 3:30 PM. The DC Bar Association will host two events titled "Visits to the U.S. Copyright Office". The price to attend ranges from $15-$25. For more information, call 202-626-3463. See, notice and notice. Location: Copyright Office, Room 401, James Madison Memorial Building, 1st Street & Independence Ave., SE.

Thursday, August 3

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).

PRC's Ministry of Commerce States It Has Perfect IPR Legal System

7/20. The Ministry of Commerce (MOC) of the Peoples Republic of China (PRC) published a statement on July 19, 2006, by MOC spokesman Chong Quan, in question and answer format, regarding Doha round negotiations, and intellectual property rights (IPR) protection in the PRC. He said that the PRC "has established a perfect IPR legal system". In addition, book publishers' groups in the US and UK recognized the PRC for its recent efforts to penalize textbook copiers.

Chong Quan stated that the "Chinese government always attaches importance to the IPR protection. Since China's entry into WTO, the government has established a perfect IPR legal system. In recent year, Chinese government has taken a series of effective measures and strongly strengthened IPR protection, especially conducted highly effective works in strengthening criminal enforcement, reinforcing coordination among law enforcement agencies in IPR and enhancing publicity of IPR protection. China made huge progress in IPR protection."

He added that "In April 2006, President Hu Jintao reiterated when visiting US that China had a firm position to protect IPR and fight against pirate and IPR infringement crimes. China will maintain improving the legal system of IPR protection, enhance law enforcement, severely fight against various crimes of IPR infringement and protect beneficiaries' legal rights in China according to law. In order to arrange works for IPR protection, China published Outline of IPR Protection Action from 2006 to 2007 and announced China's Action Plan on IPR Protection 2006, and the situation of China's IPR protection would be further improved with the implementation of the above-said plans."

See also, story titled "Hu Says PR China Will Strengthen Intellectual Property Rights and Increase Market Access" in TLJ Daily E-Mail Alert No. 1,355, April 21, 2006.

In a related matter, the Association of American Publishers (AAP) stated in a release on July 20 that "The Chinese government took action against illegal copying of English language textbooks on university campuses in June, with the Copyright Bureaus of two Chinese provinces announcing Punishment Decisions against three university textbook centers for copying books without authorization."

The AAP stated that it and the Publishers Association of the United Kingdom (PA) "recognized the efforts of the Hubei Province and Shanghai City Copyright Bureaus in targeting these activities. The Copyright Bureaus fined universities and/or related textbook service centers at Fudan University (Shanghai), Wuhan University and Wuhan University of Technology. Authorities also confiscated and destroyed pirated copies found on the premises."

The AAP added that Wuhan University of Technology, "where more than 700 infringing copies were seized, received a fine of RMB 20,000 from the Hubei Copyright Bureau. Wuhan University received a fine of RMB 10,000. The Copyright Bureau of Shanghai City levied a fine of RMB 2,000 against the textbook service center of Fudan University and directed the university to cease the infringing activity. The pirated books included titles by member companies of both PA and AAP."

The AAP concluded that "These activities constitute a positive first step in the fight against textbook piracy in China."

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