12/5. The House approved HR 4742 by voice vote without amendment. This bill would amend the Title 35 to allow the Director of the US Patent and Trademark Office (USPTO) to extend patent and trademark related filing deadlines following hurricanes and other disasters.

The bill provides that the Director may "waive statutory provisions governing the filing, processing, renewal, and maintenance of patents, trademark registrations, and applications therefor to the extent the Director deems necessary in order to protect the rights and privileges of applicants and other persons affected by an emergency or a major disaster."

This short bill also provides that "A decision not to exercise, or a failure to exercise, the waiver authority provided by this subsection shall not be subject to judicial review."

Rep. Lamar Smith (R-TX), the Chairman of the House Judiciary Committee's (HJC) Subcommittee on Courts, the Internet and Intellectual Property, introduced this bill on February 14, 2006. The HJC approved the bill, without amendment, on March 15, 2006. See, story titled "HJC Approves Bill to Allow USPTO to Waive Statutory Requirements After Disasters" in TLJ Daily E-Mail Alert No. 1,330, March 16, 2006. See also, House Report No. 109-408.

12/4. The Department of Justice's (DOJ) Office of the Inspector General released a partial copy [112 pages in PDF] of a report titled "Sentinel Audit II: Status of the Federal Bureau of Investigation's Case Management System". "Sentinel" is the FBI's latest name for its botched efforts to build an electronic, web accessed, file system.

This report is another in a series of DOJ/OIG reports, Government Accountability Office (GAO) reports, and prepared testimonies for Congressional committees that details the FBI's long running failure to establish a secure, electronic, web based, case management file system. The report addresses past failures, current problems, and prospects for completion.

This report does not estimate or describe the harm done to law enforcement and anti-terrorism efforts by the FBI's failure to modernize its file system.

The FBI now uses the name "Sentinel" to describe its spending program for a case management system. It previously named this spending program "Virtual Case File" or "VCF". The "VCF" program, in turn, was a part of the FBI's "Trilogy" program. The just released report states that the "Virtual Case File" program was an "unsuccessful 3-year, $170 million effort".

The report also states that this "Sentinel" program will provide the FBI "with a web-enabled case management system that includes records management, workflow management, and evidence management; and records search and reporting capabilities, all of which will replace its current paper-based case management system."

The FBI has estimated the price of the "Sentinel" to be $425 Million. The report states, however, that the program will require more funding.

Sen. Patrick Leahy (D-VT), the incoming Chairman of the Senate Judiciary Committee (SJC), released a statement. He wrote that "The Bush Administration's mismanagement of this project seems to know no bounds. Today's finding by the Department of Justice Office of Inspector General that the FBI will need an additional $56.7 million over what the President requested in his budget for next year to continue the Sentinel project, and that these additional costs could have an adverse impact on the FBI’s counterterrorism and other programs, are cause for deep concern."

Sen. Leahy (at right) added that the "Congress has been told that Sentinel will cost the American taxpayers $425 million to complete and that this system will not be fully operational until 2009. Yet the OIG finding of significant funding problems with Sentinel at this early stage calls the FBI’s cost estimate for this program into serious question."

He added that "After watching the FBI waste five years and more than $170 million of taxpayer dollars on the Trilogy program, I remain seriously concerned about the handling of this project. The American people cannot afford another fiasco."

The SJC will hold a hearing titled "FBI Oversight" on Wednesday, December 6, 2006, at 9:30 AM.

11/22. The U.S. Court of Appeals (5thCir) issued its opinion [40 pages in PDF] in Fiber Systems International v. Roehrs, a case regarding private rights of action under Section 1030.

The Computer Fraud and Abuse Act (CFAA), which is codified at 18 U.S.C. § 1030, pertains to "Fraud and related activity in connection with computers". It contains numerous criminal prohibitions, some of which also give rise to private rights of action.

The CFAA is also known as the anti-hacking statute. However, the statute key language of the statute is the ban on accessing "a computer without authorization or exceeding authorized access". The present case, like many others, does not involve hacking of computer systems by outsiders. Rather, employment disputes, post-employment disputes, and disputes over control of corporations, sometimes also include allegations of unauthorized access to various computers by insiders.

Background. Fiber Systems International, Inc. (FSI) is a company that makes harsh environment fiber optic connectors for military use.

Daniel Roehrs and the other individual defendants in the present case were previously officers and directors of FSI. In 2001 Roehrs and others initiated previous litigation to determine ownership of FSI. That case settled in 2003 with Michael Roehrs (Daniel's brother) buying out the interest of Daniel Roehrs and other defendants. That settlement also terminated the employment of Daniel Roehrs and other defendants. Daniel Roehrs and the other defendants formed new companies.

FSI alleged that the defendants "knowingly and intentionally accessed, deleted, downloaded, copied, took, and stole FSI’s confidential business and proprietary information and trade secrets, without authorization, from FSI’s computers". FSI also alleged that the defendants were thieves of intellectual property.

District Court. FSI initiated the present litigation in 2004 by filing a complaint in U.S. District Court (EDTex) against Daniel Roehrs, the other individual defendants, and their new companies. FSI alleged violation of Section 1030. It sought an injunction, and damages. The defendants counterclaimed alleging defamation.

The trial jury found that none of the individual defendants violated Subsection 1030(a)(5), but that three defendants, Daniel Roehrs, Thomas Hazelton, and Rick Hobbs, violated Subsection 1030(a)(4). The jury awarded FSI $36,000 in total damages. However, the District Court entered a take nothing judgment, on the grounds that Subsection 1030(a)(4) does not create a private right of action.

The District Court granted partial summary judgment against FSI on its request for injunctive relief under Section 1030.

The jury also found defamation. It awarded the individual defendants $100,000 each in compensatory damages and $1,000,000 each in punitive damages. However, the District Court reduced the punitive damages awards to $250,000 each, because the state of Texas imposes a cap on punitive damage awards.

Statute. Subsection 1030(g) creates a private right of action. It provides that "Any person who suffers damage or loss by reason of a violation of this section may maintain a civil action against the violator to obtain compensatory damages and injunctive relief or other equitable relief. A civil action for a violation of this section may be brought only if the conduct involves 1 of the factors set forth in clause (i), (ii), (iii), (iv), or (v) of subsection (a)(5)(B). Damages for a violation involving only conduct described in subsection (a)(5)(B)(i) are limited to economic damages. No action may be brought under this subsection unless such action is begun within 2 years of the date of the act complained of or the date of the discovery of the damage. No action may be brought under this subsection for the negligent design or manufacture of computer hardware, computer software, or firmware."

Subsection 1030(a)(5) provides, in full, that "Whoever ..."

"(A)
  (i) knowingly causes the transmission of a program, information, code, or command, and as a result of such conduct, intentionally causes damage without authorization, to a protected computer;
  (ii) intentionally accesses a protected computer without authorization, and as a result of such conduct, recklessly causes damage; or
  (iii) intentionally accesses a protected computer without authorization, and as a result of such conduct, causes damage; and
(B) by conduct described in clause (i), (ii), or (iii) of subparagraph (A), caused (or, in the case of an attempted offense, would, if completed, have caused) --
  (i) loss to 1 or more persons during any 1-year period (and, for purposes of an investigation, prosecution, or other proceeding brought by the United States only, loss resulting from a related course of conduct affecting 1 or more other protected computers) aggregating at least $5,000 in value;
  (ii) the modification or impairment, or potential modification or impairment, of the medical examination, diagnosis, treatment, or care of 1 or more individuals;
  (iii) physical injury to any person;
  (iv) a threat to public health or safety; or
  (v) damage affecting a computer system used by or for a government entity in furtherance of the administration of justice, national defense, or national security;"

Subsection 1030(a)(4) provides that "Whoever ... knowingly and with intent to defraud, accesses a protected computer without authorization, or exceeds authorized access, and by means of such conduct furthers the intended fraud and obtains anything of value, unless the object of the fraud and the thing obtained consists only of the use of the computer and the value of such use is not more than $5,000 in any 1-year period".

Court of Appeals. FSI brought the present appeal. It first argued that there is a private right of action for violation of Subsection 1030(a)(4). The Court of Appeals agreed.

Subsection 1030(g) creates the private right of action. It provides that there is a private right of action "only if the conduct involves 1 of the factors set forth in clause (i), (ii), (iii), (iv), or (v) of subsection (a)(5)(B)". Subsection 1030(g) does not reference Subsection 1030(a)(4).

Nevertheless, the Court of Appeals reasoned that "Section 1030(g) extends the ability to bring a civil action to any person suffering damage or loss under ``this section,´´ which refers to § 1030 as a whole, as subsection (g) does not proscribe any conduct itself. And although § 1030(g) refers to subsection (a)(5)(B), the statute does not limit civil suits to violations of § 1030(a)(5). Indeed, if Congress intended to limit civil actions in this manner, it could have simply provided that civil actions may only be brought for violations of subsection (a)(5)."

Accordingly, the Court of Appeals held that "a civil action may be maintained under § 1030(a)(4) of the CFAA if the violative conduct involves any one of these factors" set out in Subsection 1030(a)(5). It vacated the District Court's take nothing order, and remanded.

The Court of Appeals cited as authority for this proposition the Third Circuit's 2005 opinion [19 pages in PDF] in P.C. Yonkers, Inc. v. Celebrations the Party & Seasonal Superstore, LLC, which is reported at 428 F.3d 504. See, story titled "3rd Circuits Holds Employer May Sue Former Employee Under § 1030" in TLJ Daily E-Mail Alert No. 1,249, November 8, 2005.

This article does not summarize the sections of the Court of Appeals' opinion that address other appeal issues, such as the defamation issue.

This case is Fiber Systems International, Inc. v. Daniel Roehrs, et al., U.S. Court of Appeals for the 5th Circuit, App. Ct. No. 05-41213, an appeal from the U.S. District Court for the Eastern District of Texas, Sherman Division. Judge King wrote the opinion of the Court of Appeals, in which Judges Jolly and Garwood joined.

This case was tried in the Eastern District of Texas. However, this is also a rare example of a technology related case that actually arose in the Eastern District of Texas. FSI is based in Allen, Texas, which is a short distance from the U.S. District Court in Sherman, Texas.

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The House will return from its Thanksgiving recess at 10:00 AM. See, Republican Whip Notice.

The Senate will meet at 12:00 NOON.

9:00 AM - 1:30 PM. The U.S. Chamber of Commerce will host an event titled "Minding Your Business: The Future of Privacy". The speakers will include Federal Trade Commission (FTC) Chairman Deborah Majoras. See, notice. The price to attend ranges from free to $249. There will also be a webcast. The Chamber adds that "CREDENTIALED MEMBERS OF THE MEDIA ARE INVITED TO ATTEND. For an Agenda and Full List of Speakers or to Register to Attend Please Call Chamber Media Relations at 202-463-5682 or" press at uschamber dot com. A continental breakfast will be served at 8:30 AM. Location: U.S. Chamber of Commerce, 1615 H Street, NW.

9:00 - 10:15 AM. The Washington Legal Foundation (WLF) will host a panel discussion titled "Self-Regulation of Advertising: Promoting Responsibility and Maintaining Commercial Speech". The speakers will be Jodie Bernstein (Bryan Cave), Lynne Omlie (Distilled Spirits Council of the United States), and Diane Bieri (Pharmaceutical Research and Manufacturers of America). See, notice [PDF]. Breakfast will be served. Location: WLF, 2009 Massachusetts Ave., NW.

10:00 AM. The U.S. Court of Appeals (FedCir) will hear oral argument in IPVenture v. Prostar Computer, App. Ct. No. 2006-1012, a patent infringement case involving thermal management for computers. Location: Courtroom 201, 717 Madison Place, NW.

10:00 AM. The U.S. Court of Appeals (FedCir) will hear oral argument in Quickview System v. Belo Interactive, App. Ct. No. 2006-1091. This is an appeal from the U.S. District Court (NDTex), D.C. No. 3:04-CV-1254-B. The District Court construed the term "computer" in the patent claim not to include a networked systems of two or more computers. Location: Courtroom 201, 717 Madison Place, NW.

12:00 PM. The Senate Finance Committee (SFC) will hold a hearing on pending nominations, including Phillip Swagel (to be Assistant Secretary for Economic Policy at the Department of the Treasury), Anthony Ryan (Assistant Secretary for Financial Markets, DOT), Dean Pinkert (US International Trade Commission), Irving Williamson (USITC). See, notice. Location: Room 215, Dirksen Building.

2:00 - 5:00 PM. The Privacy and Civil Liberties Oversight Board (PCLOB) will hold its first public meeting. The PCLOB notice states that "Members of the public interested in attending this meeting as audience members should contact the Board at (202) 456-1240. Space is limited. Credentialed representatives of the media wishing to attend should contact Andy Pino, Georgetown University Office of Public Affairs at (202) 687-4328 or" pinoa at georgetown dot edu. Location: Gaston Hall at Healy Hall, Georgetown University.

2:00 PM. The U.S. Court of Appeals (FedCir) will hear oral argument in Monster Cable Products, Inc. v. The Quest Group d/b/a AudioQuest, App. Ct. No. 2006-1111, a patent case involving audio cables. Location: Courtroom 203, 717 Madison Place, NW.

CANCELLED. 2:30 PM. The Senate Judiciary Committee (SJC) will hold a hearing titled "Judicial Nominations". See, notice. Press contact: Blair Latoff at 202-228-5860. Location: Room 226, Dirksen Building.

6:00 - 8:15 PM. The Federal Communications Bar Association's (FCBA) Transactional Practice Committee will host a continuing legal education (CLE) seminar titled "Equity Investments and Lending to FCC-Regulated Communications Companies: Legal Issues and Business Considerations". See, notice and registration form [PDF]. Registrations and cancellations are due by 5:00 PM on December 1. The price to attend ranges from $50 to $125. Location: Sidley Austin, 6th floor, 1501 K St., NW.

Deadline to submit initial comments to the Federal Communications Commission (FCC) regarding Autotel's petition for preemption of the jurisdiction of the Arizona Corporation Commission with respect to its decisions to dismiss Autotel’s request for arbitration of an interconnection agreement with Citizens Utilities Rural Company, Inc. and Autotel’s request for termination of the rural exemption under section 251(f) of the Act. See, FCC Public Notice [PDF] (DA 06-2083). This proceeding is WT Docket No. 06-194.

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

9:30 AM. The Senate Judiciary Committee (SJC) will hold a hearing titled "FBI Oversight". The witness will be FBI Director Robert Mueller. See, notice. Press contact: Blair Latoff at 202-228-5860. Location: Room 226, Dirksen Building.

9:30 AM - 1:00 PM. The Department of Justice's (DOJ) Antitrust Division and the Federal Trade Commission (FTC) will hold another in their series of hearings on single firm conduct. The hearing will address misleading and deceptive conduct. The speakers will include Michael Brockmeyer (Frommer Lawrence & Haug), George Cary (Cleary Gottlieb), Susan Creighton (Wilson Sonsini), Preston McAfee (California Institute of Technology), Gil Ohana (Cisco Systems), and Richard Rozek (NERA Economic Consulting). See, notice. Location: FTC's Conference Center, 601 New Jersey Ave., NW.

10:00 AM. The U.S. Court of Appeals (FedCir) will hear oral argument in New Generation v. Slocum Enterprises, App. Ct. No. 2006-1137. Location: Courtroom 203, 717 Madison Place, NW.

12:30 - 2:00 PM. The DC Bar Association will host a panel discussion titled "Identity Theft, Internet Privacy and Cell Phone Privacy -- What are the Rules of the Road?". The speakers will include Marc Groman (Federal Trade Commission), Al Gidari (Perkins Coie), Eric Wenger (DOJ's Computer Crimes and Intellectual Property Section), and Heidi Salow (Sprint Nextel). The price to attend ranges from $15 to $20. For more information, call 202-626-3463. See, notice. Location: D.C. Bar Conference Center, 1250 H Street NW, B-1 Level.

1:00 - 2:30 PM. The Department of Homeland Security's (DHS) Homeland Security Advisory Council's (HSAC) Secure Borders and Open Doors Advisory Committee will hold a partially open meeting. The open portion of the meeting will be from 1:00 to 2:30 PM. See, notice in the Federal Register, November 29, 2006, Vol. 71, No. 229, at Page 69139. Location: Hilton Washington, Washington Room, 1919 Connecticut Ave., NW.

2:00 PM. The U.S. Court of Appeals (FedCir) will hear oral argument in MyMail v. America Online, App. Ct. No. 2006-1147. Location: Courtroom 203, 717 Madison Place, NW.

2:00 - 4:00 PM. The Department of State's (DOS) International Telecommunication Advisory Committee (ITAC) will meet to discuss the upcoming meeting of the ITU Radiocommunication Sector's Conference Preparatory Meeting (CPM) for the 2007 World Radiocommunication Conference, to be held on February 19 through March 2, 2007 in Geneva, Switzerland. See, notice in the Federal Register, October 10, 2006, Vol. 71, No. 195, at Page 59580. Location: Boeing Company, 1200 Wilson Blvd., Arlington, VA.

2:30 PM. The Senate Homeland Security and Governmental Affairs Committee will hold a hearing on the nomination of Paul Schneider to be Under Secretary for Management, Department of Homeland Security. See, notice. Location: Room 342, Dirksen Building.

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

8:00 - 10:30 AM. The DC Bar Association will host an event titled "Trademark Office Speaks". The speakers will include Lynne Beresford (Commissioner for Trademarks), Sharon Marsh (Deputy Commissioner for Trademark Examination Policy), and David Sams (Chief Administrative Trademark Judge, Trademark Trial and Appeal Board). The price to attend ranges from $25 to $45. For more information, call 202-626-3463. See, notice. Location: Cosmos Club, 2121 Massachusetts Ave., NW.

8:30 AM - 5:00 PM. Day one of a two day meeting of the National Institute of Standards and Technology's (NIST) Information Security and Privacy Advisory Board. See, notice in the Federal Register, November 15, 2006, Vol. 71, No. 220, at Page 66504. Location: George Washington University, Cafritz Conference Center, Rooms 101 and 308, 800 21st Street, NW.

10:00 AM. The House Judiciary Committee's (HCC) Subcommittee on Commercial and Administrative Law will meet to consider a Motion to Approve the Interim Report on the Administrative Law, Process and Procedure Project for the 21st Century. Location: Room 2237, Rayburn Building.

11:00 AM. The Senate Judiciary Committee (SJC) will hold a hearing titled "Vertically Integrated Sports Programming: Are Cable Companies Excluding Competition?" See, notice. Press contact: Blair Latoff at 202-228-5860. Location: Room 226, Dirksen Building.

Day one of a two day closed meeting of the Library of Congress's (LOC) Section 108 Study Group. This meeting will address "Review of public roundtables", "Clarifications and conclusions", and "Report drafting". This meeting is closed to the public. See also, 17 U.S.C. § 108. Location: undisclosed.

Deadline to submit initial comments to the Federal Communications Commission (FCC) on the Supporters of the Missoula Plan's proposed interim process to address phantom traffic issues. See, FCC Public Notice [PDF] (DA 06-2294).

The House will meet at 9:00 AM. See, Republican Whip Notice.

8:30 AM - 5:00 PM. Day two of a two day meeting of the National Institute of Standards and Technology's (NIST) Information Security and Privacy Advisory Board. See, notice in the Federal Register, November 15, 2006, Vol. 71, No. 220, at Page 66504. Location: George Washington University, Cafritz Conference Center, Rooms 101 and 308, 800 21st Street, NW.

Day two of a two day closed meeting of the Library of Congress's (LOC) Section 108 Study Group. This meeting will address "Review of public roundtables", "Clarifications and conclusions", and "Report drafting". This meeting is closed to the public. See also, 17 U.S.C. § 108. Location: undisclosed.

8:50 AM - 1:30 PM. The American Enterprise Institute (AEI) will host an event titled "Tax Havens and Foreign Direct Investment". The luncheon speaker will be Rep. Bill Thomas (R-CA), the outgoing Chairman of the House Ways and Means Committee. See, notice. Location: AEI,12th floor, 1150 17th St., NW,

9:00 AM - 3:30 PM. Day one of a two day meeting of the National Commission on Libraries and Information Science (NCLIS). The agenda includes discussion of digitization. See, notice in the Federal Register, November 28, 2006, Vol. 71, No. 228, at Pages 68845-68846. Location: Dining Room A, Madison Building, Library of Congress, 101 Independence Ave., SE.

4:00 - 7:00 PM. The Progress and Freedom Foundation (PFF) will host its holiday party. RSVP to Eileen Goulding at EGoulding at pff dot org or 202-289-8928. Location: Suite 500, 1444 Eye St., NW.

Deadline to submit reply comments to the Federal Communications Commission (FCC) regarding the intercarrier compensation reform plan known at the Missoula Plan. This proceeding is titled "Developing a Unified Intercarrier Compensation Regime" and numbered CC Docket No. 01-92. See, notice in the Federal Register: September 13, 2006, Vol. 71, No. 177, at Pages 54008-54009.

9:00 AM - 12:00 NOON. Day two of a two day meeting of the National Commission on Libraries and Information Science (NCLIS). The agenda includes discussion of digitization. See, notice in the Federal Register, November 28, 2006, Vol. 71, No. 228, at Pages 68845-68846. Location: Large Conference Room 642, Madison Building, Library of Congress, 101 Independence Ave., SE.

9:00 AM - 5:00 PM. Day one of a two day meeting of the National Institute of Standards and Technology's (NIST) Visiting Committee on Advanced Technology. See, notice in the Federal Register: November 28, 2006, Vol. 71, No. 228, at Page 68800. Location: Employees Lounge, Administration Building, NIST, Gaithersburg, MD.

6:00 - 9:30 PM. The DC Bar Association will host a continuing legal education (CLE) seminar titled "2006 Intellectual Property Law Series, Part 1: Trademarks, Copyrights and Law of the Internet". The speakers will include Brian Banner (Rothwell Figg Ernst & Manbeck), Beckwith Burr (Wilmer Hale), and Terence Ross (Gibson Dunn & Crutcher). The price to attend ranges from $80 to $115. For more information, call 202-626-3488. See, notice. Location: D.C. Bar Conference Center, 1250 H Street NW, B-1 Level.

Deadline to submit nominations to the Federal Communications Commission (FCC) for membership on the newly created Commercial Mobile Service Alert Advisory Committee. This Committee was created by Section 603 of the "Warning, Alert and Response Network Act" or "WARN Act", which was attached to HR 4954, the port security bill that President Bush signed on October 13, 2006. See, FCC's Public Notice [PDF] and story titled "House and Senate Approve Port Security Bill With Tech Provisions" in TLJ Daily E-Mail Alert No. 1,461, October 4, 2006.

Deadline to submit comments to the President's National Security Telecommunications Advisory Committee (NSTAC) in advance of its December 19, 2006, meeting. See, notice in the Federal Register, December 4, 2006, Vol. 71, No. 232, at Pages 70413.