Tech Law Journal Daily E-Mail Alert
March 2, 2009, Alert No. 1,907.
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Preliminary Budget Proposal Contains Spectrum License User Fee

2/26. The Office of Management and Budget (OMB) released a preliminary summary of President Obama's budget proposal for Fiscal Year 2010. It contains a "Spectrum license user fee".

This document is not the more detailed budget proposal that includes budget information for each of the departments, divisions, bureaus, and commissions that are engaged in technology related activities.

However, one notable disclosure in this preliminary document is a line item in Table S-6, titled "Mandatory and Receipts Proposals". It lists for the Federal Communications Commission (FCC) a "Spectrum license user fee". This is at page 126 by the document's pagination, and at PDF page 132.

This fee, which is not explained in this document, is projected to raise $50 Million in FY 2010, $200 Million in FY 2011, $300 Million in FY 2012, $425 Million in FY 2013, $550 Million in each of FYs 2010 through 2019.

There is also a line item in the table for "Provide permanent auction authority" to the FCC, and "Auction domestic satellite spectrum".

The section of the preliminary document that addresses the Department of Commerce (DOT), does not provide information on the NTIA, NIST, and USPTO. The section on the Department of Justice (DOJ) lacks information on the Antitrust Division and other components. However, it does state that the budget proposes $88 Million for the National Security Division (NSD). There is no section for the FCC or FTC.

Preliminary Budget Proposal Contains Proposal to Make R&D Tax Credit Permanent

2/26. The Office of Management and Budget (OMB) released a preliminary summary [PDF] of President Obama's budget proposal for Fiscal Year 2010. It references making the "research and experimentation tax credit permanent".

See, Table S-6, titled "Mandatory and Receipts Proposals", at page 122, or PDF page 128.

The Congress first enacted a research and development tax credit in 1981. It has repeatedly extended it, but only for short periods of time. The current credit expires at the end of this year.

It is codified at 26 U.S.C. § 41.

PFF Paper Addresses Parental Control Technologies and Parental Responsibility

2/27. The Progress & Freedom Foundation (PFF) released a paper [10 pages in PDF] titled "Who Needs Parental Controls? Assessing the Relevant Market for Parental Control Technologies".

The author is the PFF's Adam Thierer. He states that "A common refrain heard in debates about media, video game, or Internet content regulation is that government intervention may be necessary because parental control technologies are not widely utilized in most homes."

He argues that "the relevant universe of potential parental control users is actually quite limited". Moreover, "Regulation cannot be premised upon a lack of parental control uptake among all U.S. households. Policymakers and the courts should be skeptical of calls for regulation premised upon faulty statistical analysis and an over-estimation of the relevant universe of parental control users."

He also argues that "Parental control technologies are now ubiquitously available, increasingly easy to use, and also increasingly free-of-charge", and for families with children, but without parental control technologies, there should be education and awareness building activities.

He concludes that "Public officials should not act in loco parentis when parents have the power to make content and communications decisions on their own. And if parents are not exercising that responsibility, then they should be strongly encouraged to do so. Raising children, and determining what they watch, play, read, listen to, or download, is a quintessential parental responsibility."

FCC Fines Carriers Regarding CPNI Reporting

2/24. The Federal Communications Commission (FCC) adopted and released an Omnibus Notice of Apparent Liability (NAL) [30 pages in PDF] that fines over 600 carriers $20,000 each for failure to file of Customer Proprietary Network Information (CPNI) certifications.

The FCC also released numerous NALs that impose lesser fines for filing noncompliant CPNI certifications. See, FCC Enforcement Bureau headlines page, which currently has hyperlinks to these NALs.

These actions come 11 days after the Court of Appeals issues an opinion upholding the FCC's new CPNI rules.

The FCC's CPNI statute is codified at 47 U.S.C. § 222. In 2007, the FCC revised its rules to require the filing of CPNI certifications, including "an explanation of any actions taken against data brokers and a summary of all customer complaints received in the past year concerning the unauthorized release of CPNI".

The FCC adopted its Report and Order on March 13, 2007. It released the text [PDF] on April 2, 2007. It is FCC 07-22 in CC Docket No. 96-115 and WC Docket No. 04-36.

The U.S. Court of Appeals (DCCir) rejected a challenge to parts of these rules on February 13, 2009. See, opinion [14 pages in PDF] in NCTA v. FCC, and story titled "DC Circuit Rules in NCTA v. FCC" in TLJ Daily E-Mail Alert No. 1,900, February 16, 2009.

The FCC commenced a CPNI rulemaking as a result of the August 30, 2005, petition for rulemaking filed by the Electronic Privacy Information Center's (EPIC) to address the problem of third party data brokers and private investigators who obtain CPNI from carriers without authorization of customers.

Data brokers, private investigators, and Hewlett Packard lawyers were taking advantage of inadequate security through pretexting practices, such as pretending to be a customer seeking his own records.

Recent prosecutions by the Department of Justice (DOJ) suggest that pretexting remains a common and fruitful practice. See for example, story titled "Guilty Plea Reveals Pretexting, Social Engineering and Hacking of Verizon Phone Systems" in TLJ Daily E-Mail Alert No. 1,900, February 16, 2009.

Michael Copps, Chairman of the FCC, stated in a release that "Carriers' obligation to annually certify that they have implemented a CPNI protection plan is essential to ensuring their compliance with the Commission’s rules as well as our ability to monitor their compliance. The broad nature of this enforcement action hopefully will ensure substantial compliance with our CPNI rules going forward as the Commission continues to make consumer privacy protection a top priority."

More FCC News

2/27. The Federal Communications Commission (FCC) issued a Public Notice [PDF] regarding the mandate that it imposed upon XM Sirius in August of 2008 requiring that the four percent of audio channels on the XM and Sirius platforms be set aside for noncommercial, educational and informational programming. This PN extends the compliance deadline to May 29, 2009. This PN also requests public comments regarding these channels. Initial comments are due by March 30, 2009. Reply comments are due by April 14, 2009.

2/27. The Federal Communications Commission (FCC) adopted and released an order [PDF] that extends the deadline by which Sprint Nextel must complete the transition of the broadcast auxiliary service (BAS) to frequencies above 2025 MHz for 45 days, from March 5, 2009, to April 19, 2009. This order is FCC 09-13 in WT Docket No. 02-55, ET Docket No. 00-258, and ET Docket No. 95-18.

2/27. The Federal Communications Commission (FCC) issued two Public Notices related to planning a transition from analog to digital television. See, DA 09-528 and DA 09-521. The later announces that March 4, 2009, is the deadline to submit comments to the FCC in response to its February 20, 2009, Notice of Proposed Rulemaking (NPRM), which is FCC 09-11.

2/26. The Federal Communications Commission (FCC) released the agenda for its event on March 5, 2009, titled "Open Meeting". The only item is "presentations and discussion by senior agency officials as well as industry, consumer groups and others involved in the Digital Television Transition". This event is scheduled for 9:30 AM in the FCC Commission Meeting Room. The FCC will webcast this event. Its agenda asserts that this is "broadcast".

People and Appointments

2/28. Dan Brenner will join the Washington DC office of the law firm of Hogan & Hartson. He was previously SVP for Law and Public Policy at the National Cable & Telecommunications Association (NCTA). See, NCTA release.

2/27. President Obama announced his intent to nominate Jonathan Leibowitz to be Chairman of the Federal Trade Commission (FTC). Leibowitz is a former staff assistant to Sen. Herb Kohl (D-WI), including as counsel to the Senate Judiciary Committee's (SJC) Subcommittee on Antitrust. He is also a former lobbyist for the Motion Picture Association of America (MPAA). See, White House news office release, and story titled "Jonathan Leibowitz" in TLJ Daily E-Mail Alert No. 1,903, February 24, 2009. Patrick Ross, head of the Copyright Alliance, praised the nomination in a release. He said that "Leibowitz has a strong understanding of the policy challenges of the digital age, and recognizes the ways consumers have benefited from the digital revolution." Ross added, "We also look forward to the appointment of an intellectual property coordinator in the White House as specified in last year's PRO-IP Act". See, S 3325 [LOC | WW] (110th Congress), the "Prioritizing Resources and Organization for Intellectual Property (PRO-IP) Act of 2008", and story titled "Congress Passes IPR Enforcement Bill" in TLJ Daily E-Mail Alert No. 1,836, October 1, 2008.

2/27. Ralph Basham, Commissioner of Customs and Border Protection (CBP), retired. See, DHS release.

2/26. Chani Wiggins was named Assistant Secretary for Legislative Affairs at the Department of Homeland Security (DHS). Nelson Peacock and Sue Ramanathan were named Deputy Assistant Secretaries for DHS Legislative Affairs. See, DHS release.

More News

2/27. The U.S. Court of Appeals (4thCir) issued its opinion [13 pages in PDF] in OBX-Stock v. Bicast, a trademark case. The Court of Appeals held that the registered mark, OBX, which refers to the outer banks of the state of North Carolina, is a geographically descriptive mark without secondary meaning and therefore is not a valid trademark. This case is OBX Stock, Inc. v. Bicast, Inc., U.S. Court of Appeals for the 4th Circuit, App. Ct. Nos. No. 06-1769 and 06-1887, appeals from the U.S. District Court for the Eastern District of North Carolina, at Raleigh, D.C. No. 2:04-cv-00045-BO, Judge Terrence Boyle presiding.

2/23. The U.S. District Court (NDCal) issued a redacted order [51 pages in PDF] in Hynix v. Rambus, granting in part, and denying in part, Rambus' motion for post verdict relief in this patent case. This case is Hynix Semiconductor, Inc., et al. v. Rambus, Inc., U.S. District Court for the Northern District of California, D.C. No. C-00-20905 RMW, Judge Ronald Whyte presiding.

2/24. David Rehr, head of the National Association of Broadcasters (NAB), sent a letter [PDF] to President Obama regarding the Federal Communications Commission's (FCC) former regulatory regime sometimes referred to as the fairness doctrine. He wrote "I am writing to express our gratitude to you for the February 18, 2009, White House statement reiterating your view that the Fairness Doctrine should not be reinstated. The nation's broadcasters appreciate your support of fundamental First Amendment principles and agree with last week's statement by Ben LaBolt." Rehr added that "given that today's media environment includes cable and satellite TV channels, satellite radio, Web sites, blogs, podcasts, and other platforms, the public has more avenues than ever to express opinions and obtain a diversity of viewpoints".

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In This Issue

This issue contains the following items:
 • Preliminary Budget Proposal Contains Spectrum License User Fee
 • Preliminary Budget Proposal Contains Proposal to Make R&D Tax Credit Permanent
 • PFF Paper Addresses Parental Control Technologies and Parental Responsibility
 • FCC Fines Carriers Regarding CPNI Reporting
 • More FCC News (XM Sirius, Sprint, DTV transition, FCC meeting agenda)
 • People and Appointments (Brenner leaves NCTA, Obama picks Leibowitz, Basham retires from CBP)
 • More News (trademark ruling, Hynix v. Rambus order, fairness doctrine)

Washington Tech Calendar
New items are highlighted in red.
Monday, March 2

The House will meet at 12:30 PM for morning hour, and at 2:00 PM for legislative business. It will consider several non-technology related items under suspension of the rules. Votes postponed until Tuesday. See, Rep. Hoyer's schedule for the week of March 2, and schedule for March 2.

The Senate will meet at 2:00 PM. It will begins consideration of HR 1105 [LOC | WW], the "Omnibus Appropriations Act, 2009".

POSTPONED DUE TO WEATHER. 10:00 - 11:30 AM. The Interactive Advertising Bureau (IAB) will host an event titled "Political Online Advertising in the 2008 Election: Politics Will Never Be the Same Again". See, notice and registration page. Location: Venable, 575 7th St., NW.

10:00 AM. Deadline for foreign governments to submit comments to the Office of the U.S. Trade Representative (OUSTR) regarding countries that deny adequate and effective protection of intellectual property rights or deny fair and equitable market access to U.S. persons who rely on intellectual property protection. These comments assist the OUSTR in fulfilling its obligations under Section 182 of the Trade Act Act of 1974. See, notice in the Federal Register, January 23, 2009, Vol. 74, No. 14, Page 4263-4264.

Deadline to submit comments to the Federal Communications Commission (FCC) regarding possible revision or elimination of rules under the Regulatory Flexibility Act. See, notice in the Federal Register, December 30, 2008, Vol. 73, No. 250, at Pages 79667-79683.

EXTENDED TO MARCH 16. Deadline to submit FCC Form 477to the Federal Communications Commission (FCC). This is the FCC semi-annual form for collection of data on local telephone and broadband internet access lines. See also, February 12, 2009, Public Notice [2 pages in PDF]. See, February 23, 2009, order [3 pages in PDF].

Tuesday, March 3

The House will meet at 10:30 AM for morning hour, and at 12:00 PM for legislative business. The agenda for the week includes consideration of numerous non-technology related items. See, Rep. Hoyer's schedule for the week of March 2.

9:00 AM - 5:15 PM. Day one of a two day meeting of the Department of Energy's (DOE) Advanced Scientific Computing Advisory Committee (ASCAC) will meet. The agenda for March 3 includes "View from Washington", "ASCR Update", "Changes to INCITE Program", "Update on Extreme Scale Science Workshops", "Cyber Security R&D Planning", "Realizing Petascale Computing", "ESnet Update", "ASCAC Subcommittee Updates", and "Public Comment". See, notice in the Federal Register, February 10, 2009, Vol. 74, No. 26, at Page 6608. Location: American Geophysical Union (AGU), 2000 Florida Ave., NW.

10:00 AM. The House Appropriations Committee's (HAC) Subcommittee on Commerce, Justice, and Science will hold a hearing titled "Science Overview". The witness will be Ralph Cecerone (President of the National Academy of Sciences). Location: Room H-309, Rayburn Building.

CANCELLED. 10:00 AM. The House Judiciary Committee's (HJC) Subcommittee on Commercial and Administrative Law will hold a hearing titled "Circuit City Unplugged: Why Did Chapter 11 Fail To Save 34,000 Jobs?". See, notice. The HJC will webcast this hearing. Location: Room 2141, Rayburn Building.

12:30 PM. The House Ways and Means Committee will hold a hearing on President Obama's FY 2010 budget proposal. Secretary of the Treasury Timothy Geithner will testify. See, notice. Location: Room 1100, Longworth Building.

Wednesday, March 4

The House will meet at 10:00 AM. UK Prime Minister Gordon Brown will address a joint session of the House and Senate. The agenda for the week includes consideration of numerous non-technology related items. See, Rep. Hoyer's schedule for the week of March 2.

The Department of Energy (DOE) Office of Electricity Delivery and Energy Reliability (OE) will hold a conference titled "Design Concepts of Future Electric Transmission". See, notice in the Federal Register, February 2, 2009, Vol. 74, No. 20, at Page 5826. Location?

9:00 AM - 4:15 PM. The U.S.-China Economic and Security Review Commission will hold a meeting titled "China's Military and Security Activities Abroad". See, notice in the Federal Register, February 2, 2009, Vol. 74, No. 20, at Pages 5896-5897. Location: Room 562, Dirksen Building, Capitol Hill.

9:00 AM - 12:00 NOON. Day one of a two day meeting of the Department of Energy's (DOE) Advanced Scientific Computing Advisory Committee (ASCAC) will meet. The agenda for March 4 includes "Gordon Bell Petascale Application -- Superconductors International Collaboration", "INCITE User Perspective", and "Public Comment". See, notice in the Federal Register, February 10, 2009, Vol. 74, No. 26, at Page 6608. Location: American Geophysical Union (AGU), 2000 Florida Ave., NW.

10:00 AM. The Senate Finance Committee (SFC) will hold a hearing titled "The President’s Fiscal Year 2010 Budget Proposal: Part One". The witness will be Timothy Geithner (Secretary of the Treasury). See, notice. Location: Room 215, Dirksen Building.

10:00 AM. The House Judiciary Committee (HJC) will hold a hearing on HR 848 [LOC | WW], the "Performance Rights Act". See, notice. The HJC will webcast this hearing. See also, story titled "Performance Rights Act Reintroduced" in TLJ Daily E-Mail Alert No. 1,896, February 10, 2009. Location: Room 2141, Rayburn Building.

TIME AND ROOM CHANGE. 10:00 AM. The Senate Judiciary Committee (SJC) will hold a hearing titled "Getting to the Truth Through a Nonpartisan Commission of Inquiry". The SJC will webcast this event. See, notice. Location: Room 106, Dirksen Building.

2:00 PM. The House Ways and Means Committee will hold a hearing on President Obama's FY 2010 budget proposal. Peter Orszag (Director of the Office of Management and Budget) will testify. See, notice. Location: Room 1100, Longworth Building.

3:00 - 5:00 PM. The Federal Communications Commission's (FCC) Consumer Advisory Committee will meet. See, FCC notice [PDF] and notice in the Federal Register, February 17, 2009, Vol. 74, No. 30, at Page 7435. Location: FCC, Commission Meeting Room (Room TW-C305), 445 12th St., SW.

TIME? The Office of the U.S. Trade Representative (OUSTR) will hold a hearing regarding its plans to initiate negotiations on a Trans-Pacific Partnership free trade agreement with Singapore, Chile, New Zealand, Brunei Darussalam, Australia, Peru and Vietnam. See, notice in the Federal Register, January 26, 2009, Vol. 74, No. 15, at Pages 4480-4482. Location?

Deadline to register for the National Institute of Standards and Technology's (NIST) Office of Law Enforcement Standards' (OLES) March 11, 2009, meeting via the internet to bring Project 25 Compliance Assessment Program stakeholders together to discuss what the process will be to assess software based test tools for the Project 25 Compliance Assessment Program. See, notice in the Federal Register, February 17, 2009, Vol. 74, No. 30, at Pages 7397-7398.

Thursday, March 5

The House will meet at 10:00 AM for legislative business. The agenda for the week includes consideration of numerous non-technology related items. See, Rep. Hoyer's schedule for the week of March 2.

9:30 - 11:00 AM. The Information Technology and Innovation Foundation (ITIF) will host an event titled "The Need for Speed: The Importance of Next-Generation Broadband Networks". Location: ITIF, Suite 200, 1250 Eye St., NW.

10:00 AM. The Senate Judiciary Committee (SJC) may hold an executive business meeting. The agenda includes consideration of the nominations of Elena Kagan to be Solicitor General, Thomas Perrelli to be Associate Attorney General, and David Kris to be Assistant Attorney General in charge of the National Security Division. The SJC rarely follows its published agendas. The SJC will webcast this event. See, notice. Location: Room 226, Dirksen Building.

10:00 AM. The House Appropriations Committee's (HAC) Subcommittee on Commerce, Justice, and Science will hold a hearing titled "Science Education". Location: Room 2359, Rayburn Building.

2:00 PM. The House Appropriations Committee's (HAC) Subcommittee on Commerce, Justice, and Science will hold a hearing. The witness will be Norm Augustine. Location: Room H-309, Rayburn Building.

3:00 PM. The Senate Finance Committee (SFC) will hold a hearing on the nomination of Ron Kirk to be head of the Office of the U.S. Trade Representative (OUSTR). See, notice. Location: Room 215, Dirksen Building.

The Federal Communications Commission (FCC) will hold an event titled "Open Meeting". Location: FCC, Commission Meeting Room (Room TW-C305), 445 12th St., SW.

Friday, March 6

Rep. Hoyer's schedule for the week of March 2 states that the House will meet at 9:00 AM for legislative business.

10:00 AM. The U.S. Court of Appeals (FedCir), Panel I, will hear oral argument in Digital Impact v. Bigfoot Interactive, App. Ct. No. 2008-1255, a patent case regarding e-mail distribution technology. See, Federal Circuit oral argument calendar for March, 2009. Location: Courtroom 201, 717 Madison Place, NW.

Sunday, March 8

Daylight savings time begins.

Deadline to submit to the U.S. Patent and Trademark Office (USPTO) nominations of individuals to serve on the National Medal of Technology and Innovation Nomination Evaluation Committee. See, notice in the Federal Register, January 8, 2009, Vol. 74, No. 5, at Pages 800-801.

Monday, March 9

Deadline to submit initial comments to the Federal Communications Commission's (FCC) Media Bureau in response to the petitions for declaratory rulings of the Alliance for Community Media (ACM) and others regarding carriage of public, educational and governmental (PEG) channels. See, order [PDF] setting deadlines.

Deadline to submit comments to the Federal Trade Commission (FTC) regarding the proposed settlement agreement between the FTC and Genica Corporation and Compgeeks.com. See, notice in the Federal Register, February 10, 2009, Vol. 74, No. 26, at Pages 6627-6629. See, also story titled "FTC Brings and Settles Administrative Action Against Hacked Online Retailers" in TLJ Daily E-Mail Alert No. 1,893, February 6, 2009.

Deadline to submit reply comments to the Federal Communications Commission (FCC) regarding the October 8, 2008, Petition for Rulemaking [18 pages in PDF] submitted by the CTIA regarding transitioning certain cellular licensing rules to a geographic market area based licensing system. See, FCC's Public Notice numbered DA 09-5, and notice in the Federal Register, January 22, 2009, Vol. 74, No. 13, at Pages 4036-4037. This proceeding is RM No. 11510.