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June 18, 2009, Alert No. 1,958.
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Obama Picks IBM's Kappos for USPTO

6/18. President Obama announced his intent to nominate David Kappos to be head of the U.S. Patent and Trademark Office (USPTO). See, White House news office release.

He is VP and Assistant General Counsel, Intellectual Property Law, at IBM. His undergraduate degree is in electrical and computer engineering.

Several USPTO appointments during the Bush administration came from Capitol Hill, rather than from the private sector.

The position is Under Secretary of Commerce for Intellectual Property and Director of the USPTO. The most important responsibilities of the USPTO pertain to issuance of patents. However, the USPTO also is responsible for trademarks. It also has some duties regarding copyright.

The USPTO is a unit of the Department of Commerce, which is part of the executive branch. The Copyright Office is a unit of the Library of Congress, which is a part of the legislative branch. The USPTO is one of several executive branch entities involved in international copyright issues. The USPTO has some statutory responsibilities with respect to copyright, including providing technical assistance and advice to foreign governments on copyright enforcement. It also advises the President and executive branch agencies on copyright matters.

Patent Reform. On March 3, 2009, Sen. Patrick Leahy (D-VT) and others introduced S 515 [LOC | WW], the "Patent Reform Act of 2009", and Rep. John Conyers (D-MI) and others introduced HR 1260 [LOC | WW], the companion bill in the House. See also, story titled "Patent Reform Bills Introduced" in TLJ Daily E-Mail Alert No. 1,908, March 4, 2009.

The Senate Judiciary Committee (SJC) held a hearing on March 10, 2009, on S 515. Kappos testified.

He said that IBM urges passage of S 515.

He wrote in his prepared testimony [16 pages in PDF] that "The nature of innovation has changed. Today, we benefit from inventions made possible through highly collaborative and interconnected technologies. Many of the products that consumers demand are complex and include contributions from multiple innovators that incorporate hundreds if not thousands of patented inventions. At the same time, many new innovations require investments of unprecedented size to achieve a single new product protected by a single patent. For the United States to remain competitive our patent system must accommodate all of these innovation models. Yet our patent laws have not been significantly updated for over 50 years."

He continued that "IBM supports S 515's approach to improving patent quality, including ``first window创 post grant review, enhanced inter partes reexamination, and pre-issuance submission of information."

He elaborated on post grant review. He said the "IBM believes it is vitally important to have an administrative proceeding to allow the public to bring forward relevant information, post-issuance, about whether a patent was properly issued. This will increase the quality of patents and will provides a low cost alternative to litigation. The solution in the bill represents a reasonable compromise between the need to provide a meaningful way to bring forward relevant information and concerns that the administrative proceeding will be used to harass the patentee. The bill provides the ability to challenge the patent in a post-grant-review proceeding for one year following issuance based on a broad array of grounds related to patentability."

Then, "After one year, the public can bring forward relevant information through an ``improved创 version of the existing inter partes reexamination administrative proceeding. The improved inter partes reexamination proceeding will no longer prevent a challenger from going to court at a later time on an issue that was not raised in the proceeding. Further, in addition to patents and printed publications, a challenger may submit evidence that the claimed invention was in public use or on sale in the U.S. more than one year prior to the application. This is evidence that the examiner could have used to reject the patent application during prosecution, but which a third party currently can only use to challenge the validity of an issued patent by going to court."

He also addressed the subject of calculating damages for patent infringement. He said that patentees must be "appropriately compensated", but that "the current legal standard does not provide the certainty needed to enable modern business to operate effectively."

He continued that "IBM believes that the Supreme Court provided critical guidance in its recent, unanimous Quanta decision. ... An approach that uses the Quanta standard as a starting point will provide the guidance needed to properly compensate the inventor ..."

He also stated that IBM recommends that patent reform legislation focus on "(1) incorporating Quanta's ``essential features创 concept in to the damages determination; (2) ensuring district courts increase precision in Entire Market Value Rule (``EMVR创) and Convoyed Sales determinations; and (3) requiring district courts to better exercise their gatekeeper powers to cause rigorous expert analysis and review of damages evidence and reasonable royalty determinations."

See, June 9, 2008, opinion [22 pages in PDF] of the Supreme Court in Quanta Computers v. LG Electronics, 553 U.S. __. See also, story titled "Supreme Court Rules on Patent Exhaustion Doctrine" in TLJ Daily E-Mail Alert No. 1,778, June 9, 2008.

On September 1, 2008, Kappos gave $2,300 to the Obama campaign. He also gave a total of $1,000 to the American Intellectual Property Law Association's (AIPLA) political action committee in 2007 and 2008.

Reaction. Ed Black, head of the Computer and Communications Industry Association (CCIA), stated in a release that "We are very pleased with nomination of Dave Kappos. Kappos is widely regarded as one of the most thoughtful and creative members of the intellectual property community. He has played a leadership role in the development of the peer review experiment in patent examination (``peer-to-patent创 or ``community patent review创). He also has been a leader in grappling with the growing conflict between patents and standards, especially the problem of patent ambush. The patent system is facing monumental challenges today, as the growing diversity in innovation confronts an increasingly costly legal system in which one size fits all." (Parentheses in original.)

Teresa Rea, President of the AIPLA, stated in a release that Kappos "has been a stalwart proponent of a strong and effective patent and trademark system. We wish him the best in applying his experience and understanding to the challenges ahead. AIPLA is also very pleased to see that the long wait for a USPTO Director has ended with the nomination of an experienced and respected IP practitioner."

Todd Dickinson, Executive Director of the AIPLA, and head of the USPTO during the latter part of the Clinton administration, stated that Kappos's "nomination offers an opportunity for a fresh start, and we look forward to working together with him to meet those challenges."

Mark Bohannon of the Software and Information Industry Association (SIIA) stated in a release that "We urge the Senate to move quickly to confirm Mr. Kappos, whose skills and experience are needed in these challenging economic times."

Gigi Sohn, head of the Public Knowledge, praised Kappos in a release. She wrote that "We also hope that Kappos will reevaluate the role that PTO has played in copyright issues, concentrating instead on fixing the patent issues that need immediate attention."

Copps Discusses Unserved and Underserved

6/18. Federal Communications Commission (FCC) Chairman Michael Copps gave a speech in Washington DC in which he discussed, among other topics, whether to prioritize unserved or underserved areas in subsidizing broadband, the FCC's broadband plan proceeding, and transparency at the FCC.

Michael Copps Unserved v. Underserved. Copps (at right) spoke about whether to prioritize unserved or underserved areas in federal broadband grants.

HR 1 [LOC | WW], the huge spending bill passed in February, includes federal subsidies for the deployment of broadband infrastructure. It provides that the purposes of this funding include both to "provide access to broadband service to consumers residing in unserved areas" and to "provide improved access to broadband service to consumers residing in underserved areas". See, story titled "Summary of Broadband Grants Provisions in Spending Bill" in TLJ Daily E-Mail Alert No. 1,899, February 13, 2009.

He said that "I start from the premise that America as a country can be considered an underserved area."

"Certainly folks in rural America who don抰 receive broadband at all stand out. But how about small businesses in both rural and urban areas trying to compete on embarrassingly slow-speed broadband that is all that's available in so many places?", said Copps.

"Of course rural is a priority. But so are low-income residents in urban areas who don抰 have access to affordable broadband because providers don抰 find it profitable to go there."

He also said that "if we get side-tracked into some either-or debate over unserved versus underserved -- especially one that serves as a proxy for rural versus urban -- we will not get a national broadband plan that does justice to America's needs."

Broadband Plan. HR 1 also requires the FCC to write a broadband plan. The FCC adopted and released a Notice of Inquiry [PDF] on April 8, 2009. The deadline for initial comments was June 8, 2009. The deadline for reply comments is July 7, 2009. See, stories titled "FCC Releases NOI on Broadband Plan" and "Broadband Plan Statute: Public Law No. 111-5, 6001(k)" in TLJ Daily E-Mail Alert No. 1,924, April 11, 2009. This NOI is FCC 09-31 in GN 09-51.

Copps said that there is an "urgent, pressing, crying need to develop a national broadband plan".

He added that "Our challenge is to make sure a focused, practical, achievable broadband plan comes out -- instead of trying to resolve every contentious issue that has fueled so many years of seemingly-endless debates over telecommunications".

Transparency. Copps said that "beginning with the broadband proceeding, we can transform the old FCC into a new, more consumer-oriented and consumer-responsive agency. New technologies, techniques and non-traditional outreach can put the focus of this Commission where it was supposed to be for these past 75 years. This effort to create a more transparent and open FCC must not only be different in degree from what we have done before; it must be different in kind. So for my remaining time at the FCC, I am going to be working on this ..."

Copps' record during his tenure at the FCC has been as an advocate of less transparency. He has urged the Congress to amend the Open Meeting Act to allow the Commission to meet and conduct business in secret.

See, for example, story titled "Copps and Stevens Advocate Less Transparency at FCC" in TLJ Daily E-Mail Alert No. 1,272, December 14, 2004.

The relevant statute, which is codified at 5 U.S.C. 552b, requires that federal agencies must hold their meetings in public, and that they must give notice "at least one week before the meeting, of the time, place, and subject matter of the meeting". This statute further provides that "deliberations of at least the number of individual agency members required to take action on behalf of the agency" constitutes a meeting.

FCC Commissioners cannot by law meet in secret. The reaction of Copps and other Commissioners is not to hold public meetings, but rather to conduct little business in public, and use other means, such as relaying communications through staff, to reach decisions. This lessens the transparency of the FCC's activities and operations.

Bill Would Give FTC Authority to Regulate Service Plans of Broadband Internet Service Providers

6/16. Rep. Eric Massa (D-NY), Rep. Dan Perriello (D-VA), and Rep. Maurice Hinchey (D-NY), introduced HR 2902 [LOC | WW], the "Broadband Internet Fairness Act", a bill to give the FTC authority to regulate rates and terms of broadband internet access services.

This would provide that "It shall be unlawful for major broadband Internet service providers to offer volume usage service plans imposing rates, terms, and conditions that are unjust, unreasonable, or unreasonably discriminatory."

The bill defines a "major broadband Internet service provider" as one that "provides broadband Internet service to 2,000,000 or more subscribers".

The bill does not define either "unjust", "unreasonable", or "discriminatory".

This bill would give the Federal Trade Commission (FTC) both rulemaking and enforcement authority.

The bill would create a second regulator of broadband internet access providers. The Federal Communications Commission (FCC) has classified broadband internet access services as information services. Unless and until it changes these rulings, it cannot apply its Title II common carrier regulatory regime to broadband service providers. However, the FCC is creating, out of thin air, and its August 2005 Policy Statement, a new regulatory new regime for broadband internet access providers.

It asserted this authority in its August 2008 Comcast order. The FCC adopted this order on August 1, 2008, and released the text [67 pages in PDF] on August 17, 2009. It is FCC 08-183 in Docket No. 07-52. See also, story titled "FCC Asserts Authority to Regulate Network Management Practices" in TLJ Daily E-Mail Alert No. 1,805, August 4, 2008.

Rep. Massa issued a release that states that the bill "will prevent the monopolistic rate increases of broadband companies by promoting the interests of broadband customers".

He stated in this release that "Cable providers want to stifle the internet so they can rake in advertiser dollars by keeping consumers from watching video on the Internet. But so long as Americans can't choose which cable channels they want to pay for, I don't think cable operators should be able to determine consumers' monthly internet usage. Additionally, charging based on a bandwidth usage is a flawed model when the cost of usage is totally out of line with the price. Consumers are much better served by plans based on the speed of the connection rather than amount of bandwidth used. Competition is crucial to our economy and I refuse to let monopolistic corporations dominate the market and gouge my constituents."

Ben Scott of the Free Press stated in a release that "With monthly Internet bills on the rise, overcharges just add insult to injury ... This is an inspiring example of grassroots activism fighting against a big corporation and a member of Congress siding with the people. We don't see it often enough. This bill sends a message that Congress is watching and can take action to protect consumers."

Adam Thierer of the Progress & Freedom Foundation (PFF) offered a sarcastic response to this bill. "Oh my God, no ... you mean some people might be charged for the costs they impose? What's next? Are we going to force people to pay for their own energy use by metering gasoline, electricity, or water? Think of the horror!"

The bill was referred to the House Commerce Committee (HCC).

In This Issue
This issue contains the following items:
  Obama Picks IBM's Kappos for USPTO
  Copps Discusses Unserved and Underserved
  Bill Would Give FTC Authority to Regulate Service Plans of Broadband Internet Service Providers
  Jury Returns Verdict Against P2P Infringer
Jury Returns Verdict Against P2P Infringer

6/18. A trial jury of the U.S. District Court (DMinn) returned a verdict in Capitol Records v. Thomas, a music copyright infringement case involving use of the Kazaa peer to peer (P2P) network.

The jury found Jammie Thomas liable for copyright infringement under 17 U.S.C. 106, and awarded statutory damages of $80,000 per song for 24 songs under 17 U.S.C. 504.

See also, stories titled "District Court Grants New Trial to P2P Infringer" in TLJ Daily E-Mail Alert No. 1,833, September 26, 2008, and "Update on Capitol Records v. Thomas" in TLJ Daily E-Mail Alert No. 1,857, November 17, 2008.

Cara Duckworth of the Recording Industry Association of America (RIAA) stated in a release that "We appreciate the jury's service and that they take this as seriously as we do. We are pleased that the jury agreed with the evidence and found the defendant liable. Since day one, we have been willing to settle this case and we remain willing to do so."

Tom Sydnor of the Progress & Freedom Foundation (PFF) stated in a release that the jury "upheld the rule of law and sent a message: copyright piracy is illegal and morally wrong. Nor does the jury's award appear to be unconstitutionally excessive. Legally acquiring a license to give copies of a song to potentially millions of KaZaA users might well have cost $80,000 per song. Moreover, if the jury concluded that the defendant falsified her testimony, it could fairly seek to punish and deter such flagrant wrongdoing."

Sydnor added that "distributors of piracy-software can no longer use single mothers as human shields to protect their business models".

He also stated that "Thomas' conduct strongly suggests that if copyright owners could have invoked a notice-and-takedown or graduated-response process, neither a lawsuit nor a verdict would have been necessary".

Ed Black, head of the Computer and Communications Industry Association (CCIA), recalled that "When Sony BMG massively and illegally distributed music CDs containing spyware that compromised individual users' computer security and infected government and military networks worldwide, the FTC only ordered them in 2007 to reimburse end-users up to $150 for computer damages. Yet when Ms. Thomas shared 24 songs belonging to Sony BMG and other labels on the Internet, she was penalized $80,000 for each single track."

See, January 30, 2007, FTC Complaint [5 pages in PDF] and Agreement Containing Consent Order [11 pages in PDF]. This is FTC File No. 062-3019.

See also, stories titled "Texas Sues Sony BMG Alleging Violation of Texas Spyware Statute" in TLJ Daily E-Mail Alert No. 1,258, November 22, 2005, and "Texas Amends Spyware Complaint Against Sony BMG" in TLJ Daily E-Mail Alert No. 1,280, December 29, 2005.

Black continued that "This isn抰 a question about whether file-sharing is wrong -- the question is what does this say about our priorities? ... The application of existing law in this case may have been technically correct, but used to protect the recording industry from losses that could have cost them pennies, with a $1.9 million fine against a music fan."

This case is Capitol Records, Inc., et al. v. Jammie Thomas, U.S. District Court for the District of Minnesota, D.C. No. 06-1497.

Washington Tech Calendar
New items are highlighted in red.
Saturday, June 20

Deadline to submit certain reply comments to the Federal Communications Commission (FCC) in response to its supplemental Notice of Inquiry [22 pages in PDF] regarding its preparation of a video competition report for the years ending June 30, 2007, June 30, 2008, and June 20, 2009. This deadline pertains to comments regarding 2007 and 2008. See, notice in the Federal Register, April 27, 2009, Vol. 74, No. 79, at Pages 19085-19091. See also, story titled "FCC Resumes Its Statutory Obligation to Study Video Competition" in TLJ Daily E-Mail Alert No. 1,886, January 21, 2009, and story titled "FCC Releases Amended NOI on Annual Video Competition Reports" in TLJ Daily E-Mail Alert No. 1924, April 11, 2009.

Monday, June 22

The House will not meet. See, Rep. Hoyer's schedule for week of June 22.

The Senate will meet at 2:00 PM. It will resume consideration of S 1023 [LOC | WW], the "Travel Promotion Act of 2009".

8:30 AM - 4:30 PM. Day one of a two day public workshop hosted by the Department of Homeland Security's (DHS) Privacy Office titled "Government 2.0: Privacy and Best Practices". This workshop will address operational, privacy, security, and legal issues associated with government use of social media. This event is open to the public. See, notice in the Federal Register, April 17, 2009, Vol. 74, No. 73, at Pages 17876-17877. See also, story titled "DHS Privacy Office Seeks Comments on Government Use of Social Media" in TLJ Daily E-Mail Alert No. 1928, April 16, 2009. Location: Atrium Ballroom, Washington Court Hotel, 525 New Jersey Ave., NW.

12:00 NOON - 2:00 PM. There will be a closed brown bag lunch titled "Communications and Copyright in the 111th Congress" at which staff of the House and Senate Commerce and Judiciary Committees will meet with representatives of regulated entities. This meeting is subject to a reporter gag order. Location: National Cable & Telecommunications Association, 25 Massachusetts Ave., NW.

2:00 - 3:30 PM. The Information Technology and Innovation Foundation (ITIF) will host a panel discussion titled "The Cost of Privacy: A Debate on the Impact of Privacy Laws on Health IT Adoption". The speakers will be Daniel Casto (ITIF), Amalia Miller (University of Virginia), Catherine Tucker (MIT Sloan School of Management), and Deven McGraw (Center for Democracy and Technology). See, notice. Location: ITIF, Suite 610, 1101 K St., NW.

Effective date of, and deadline to submit comments regarding, the Department of Homeland Security (DHS) establishment of a new DHS system of records notice titled "DHS/USCIS -- 009 Compliance Tracing and Monitoring System". This CTMS will collect and use information related to the monitoring and compliance activities for researching and managing misuse, abuse, discrimination, breach of privacy, and fraudulent use of USCIS Verification Division's verification programs, the Systematic Alien Verification for Entitlements (SAVE), and E-Verify. See, notice in the Federal Register, May 22, 2009, Vol. 74, No. 98, at Pages 24022-24027.

Deadline to submit nominations to the Public Knowledge for its annual IP3 awards. For more information, contact Art Brodsky at abrodsky at publicknowledge dot org. Submit nominations to IP3nominees at publicknowledge dot org.

Tuesday, June 23

The House will meet at 10:30 AM for morning hour, and at 12:00 NOON for legislative business. Votes will be postponed until 6:30 PM. See, Rep. Hoyer's schedule for week of June 22.

8:30 AM - 12:30 PM. Day one of a two day public workshop hosted by the Department of Homeland Security's (DHS) Privacy Office titled "Government 2.0: Privacy and Best Practices". This workshop will address operational, privacy, security, and legal issues associated with government use of social media. This event is open to the public. See, notice in the Federal Register, April 17, 2009, Vol. 74, No. 73, at Pages 17876-17877. See also, story titled "DHS Privacy Office Seeks Comments on Government Use of Social Media" in TLJ Daily E-Mail Alert No. 1928, April 16, 2009. Location: Atrium Ballroom, Washington Court Hotel, 525 New Jersey Ave., NW.

3:00 PM. Deadline to submit grant applications to the National Institute of Standards and Technology (NIST) for funding under its Technology Innovation Program (TIP). The TIP is offering grants for research and development of, among other things, civil infrastructure sensing technologies. See, notice in the Federal Register, March 31, 2009, Vol. 74, No. 60, at Pages 14524-14531, and amendment notice in the Federal Register, May 19, 2009, Vol. 74, No. 95, at Page 23396.

Wednesday, June 24

9:00 - 10:30 AM. The Information Technology and Innovation Foundation (ITIF) will host a panel discussion titled "White House Leadership on Innovation Policy: The Case for an Office of Innovation Policy". The speakers will be Robert Atkinson (ITIF), Stuart Benjamin (Duke University law school), Arti Rai (Duke), and Stephen Merrill ( National Academy of Sciences). See, notice. Location: ITIF, Suite 610, 1101 K St., NW.

10:00 AM. The Senate Judiciary Committee (SJC) will hold a hearing on pending nominations, including that of Christopher Schroeder to Assistant Attorney General in charge of the Department of Justice's (DOJ) Office of Legal Policy (OLP). See, notice. Location: Room 226, Dirksen Building.

2:00 PM. The Senate Judiciary Committee (SJC) will hold a hearing titled "Promoting Job Creation and Foreign Investment in the United States: An Assessment of the EB-5 Regional Center Program". See, notice. The SJC will webcast this event. Location: Room 226, Dirksen Building.

5:00 PM. Deadline to submit petitions to the Office of the U.S. Trade Representative (OUSTR) to modify the list of products that are eligible for duty free treatment under the Generalized System of Preferences (GSP) program and to modify the GSP status of certain GSP beneficiary developing countries because of country practices. See, notice in the Federal Register, May 28, 2009, Vol. 74, No. 101, Page 25605-25607.

Thursday, June 25

12:00 NOON. The Senate Judiciary Committee (SJC) will hold an executive business meeting. The agenda again includes consideration of S 417 [LOC | WW], the "States Secret Protection Act", and HR 985 [LOC | WW] and S 448 [LOC | WW], both titled the "Free Flow of Information Act of 2009". See, stories titled "Senate Judiciary Committee to Consider State Secrets Bill" and "9th Circuit Rules in State Secrets Case" in TLJ Daily E-Mail Alert No. 1,933, April 29, 2009. The SJC rarely follows its published agendas. See, notice. Location: Room 226, Dirksen Building.

12:15 - 1:45 PM. The New America Foundation (NAF) will host a panel discussion titled "The End of Spectrum Scarcity: Opportunistic Access to the Airwaves". The speakers will be Kevin Werbach (University of Pennsylvania, and member of President Obama's FCC transition team), Preston Marshall, Michael Marcus, Tom Stroup (Shared Spectrum Company), Sascha Meinrath (NAF), and Michael Calabrese (NAF). See, notice. Location: NAF, 4th floor, 1899 L St., NW.

3:00 PM. Deadline to submit applications to the National Institute of Standards and Technology (NIST) for money to build research science buildings. See, notice in the Federal Register, June 1, 2009, Vol. 74, No. 103, at Pages 26213-26217.

6:00 PM. Deadline to submit applications to the Federal Communications Commission (FCC) to participate in Auction 79, regarding 122 construction permits in the FM broadcast service. See, May 29, 2009, public notice (DA 09-152), and notice in the Federal Register, May 29, 2009, Vol. 74, No. 102, at Pages 25737-25744.

6:00 - 8:00 PM. The Federal Communications Bar Association (FCBA) will host a reception. Location: Washington Hilton Hotel, 1919 Connecticut Ave., NW.

Friday, June 26

5:00 PM. Deadline to submit comments to the Department of Health and Human Services' (DHHS) Health Information Technology Policy Committee regarding the meaning of the term "meaningful use'' of electronic health records, as used in Sections 4101 and 4202 of HR 1 [LOC | WW], the huge spending bill enacted in February. See, notice in the Federal Register, June 18, 2009, Vol. 74, No. 116, at Page 28937.

Deadline to submit initial comments to the Federal Communications Commission (FCC) in response to it Fourth Further Notice of Proposed Rulemaking regarding whether or not to modify FCC Form 323-E, the Ownership Report filed by noncommercial educational (NCE) licensees of AM, FM, and TV broadcast stations, to obtain gender, race, and ethnicity data. This 4thFNPRM is FCC 09-33 in MB Docket Nos. 07-294, 06-121, 02-277 and 04-228, and MM Docket Nos. 01-235, 01-317, and 00-244. See, public notice DA 09-1195, and notice in the Federal Register, May 27, 2009, Vol. 74, No. 100, at Pages 25205-25208.

Deadline to submit comments to the National Institute of Standards and Technology's (NIST) Computer Security Division (CSD) regarding its SP 800-16 Rev. 1 [157 pages in PDF] titled "Information Security Training Requirements: A Role- and Performance-Based Model (DRAFT)".

Monday, June 29

The House will not meet the week of June 29 through July 3.

The Senate will not meet the week of June 29 through July 3. See, Senate calendar.

Deadline to submit reply comments to the Federal Communications Commission (FCC) in response to its public notice regarding commercial programming on school buses. This public notice is DA 09-913 in MB Docket No. 09-68.

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