Tech Law Journal Daily E-Mail Alert
October 28, 2010, Alert No. 2,147.
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FTC Ends Investigation of Google WiFi Intercepts

10/27. The Federal Trade Commission (FTC) sent a letter [2 pages in PDF] to Google regarding its investigation into Google's interception of wireless communications. The FTC wrote that "we are ending our inquiry into this matter at this time".

The FTC wrote that Google was "collecting some ``"payload´´ data contents of communications sent over unsecured wireless networks".

The FTC rationalized its decision: "we note that Google has recently announced improvements to its internal processes to address some of the concerns raised above, including appointing a director of privacy for engineering and product management; adding core privacy training for key employees; and incorporating a formal privacy review process into the design phases of new initiatives. The company also publicly stated its intention to delete the inadvertently collected payload data as soon as possible. Further, Google has made assurances to the FTC that the company has not used and will not use any of the payload data collected in any Google product or service, now or in the future. This assurance is critical to mitigate the potential harm to consumers from the collection of payload data." (Footnotes omitted.)

This letter contains no legal analysis, and no reference to statutory sections. The FTC enforces no general privacy statute. It does, however, have broad civil authority, under Section 5 of the Federal Trade Commission Act (FTCA), which is codified at 15 U.S.C. § 45, to regulate unfair and deceptive trade practices. It has relied upon this section in many actions involving business's privacy related practices.

It does not have authority to bring criminal prosecutions under 18 U.S.C. § 2511, which prohibits interception of electronic communications. This section provides that "any person who ... intentionally intercepts, endeavors to intercept, or procures any other person to intercept or endeavor to intercept, any wire, oral, or electronic communication ... shall be punished".

Also, 18 U.S.C. § 2520 provides a private right of action. Class action complaints alleging violation of Section 2511 have been consolidated in the U.S. District Court (NDCal).

Marc Rotenberg, head of the Electronic Privacy Information Center (EPIC), told TLJ on October 25 that in addition to investigations by data protection and judicial officials outside of the U.S., "the Connecticut State Attorney General, Richard Blumenthal, also pursued a series of investigations, in coordination with 36 other state attorney generals".

Rotenberg continued "this is a very important case, and it goes to the privacy of internet users, the integrity of the communication networks, and the need to ensure clear standards to ensure privacy and security for wireless access".

He argued that "many of these investigations need to go forward".

He concluded that "we are very concerned, however, that neither the Federal Trade Commission nor the Federal Communications Commission seem to show much interest in this, even after members of Congress wrote to them and asked them to investigate the matter. They simply sat on their hands, and I don't think they came out of this looking particularly well."

John Simpson, of Consumer Watchdog, stated in a release that "Once again, Google, with its myriad of government connections, gets a free pass".

He continued that "the public deserved a full report about Google's abuses from the FTC's Bureau of Consumer Protection. Instead, the company announced a few steps that are little more than window dressing and the FTC caves in with a woefully inadequate two-page letter."

Simpson added that "It appears likely that the only way the American public will get to the bottom of the extent of Google’s Wi-Spying activities is through civil litigation or the state attorneys general investigation".

Rep. Barton Seeks Chairmanship of House Commerce Committee

10/27. Rep. Joe Barton (R-TX), the ranking Republican on the House Commerce Committee (HCC), wrote a piece, published in the Washington Times and the HCC Republicans web site, that "If the people agree and make Republicans the new majority in the House, I will ask my colleagues for the privilege of serving as chairman of the committee".

He also wrote that "I intend to uncover during the first six months of 2011 ... Why the Obama administration's Federal Communications Commission thinks the Internet needs federal government regulation for the first time".

House Republicans limit their members to three terms as Chairman or ranking member of a Committee. Rep. Barton was Chairman in the 109th Congress and ranking member in the 110th Congress. For Rep. Barton to continue as Chairman, House Republicans would have to waive their three term rule.

Rep. Barton's comments at a June 17, 2010, hearing regarding an Obama administration "shakedown" of British Petroleum may affect his prospects for obtaining such a waiver. See, story titled "Rep. Barton and Government Shakedowns and Takeovers" in TLJ Daily E-Mail Alert No. 2,098, June 21, 2010.

Rep. Ralph Hall Rep. Ralph Hall (R-TX) (at right) is next in seniority. He is 87 years old. Like Rep. Barton, he represents a District in the Dallas Ft. Worth, Texas, area.

Rep. Fred Upton (R-MI), who is a former Chairman of Subcommittee on Telecommunications and the Internet, follows Rep. Hall in seniority.

If Republicans were to regain a majority in the House, regardless of which member were selected Chairman, FCC Chairman Julius Genachowski would likely face an increasingly hostile HCC, as did former Chairman William Kennard late in his tenure, and former Chairman Kevin Martin after Democrats took control of the House in the 110th Congress.

Verizon Wireless to Pay Fine and Give Refunds for Overbilling Customers

10/28. The Federal Communications Commission's (FCC) Enforcement Bureau (EB) adopted and released an Order [PDF] and Consent Decree [9 pages in PDF] regarding Verizon Wireless's billing practices with respect to data usage.

The Consent Decree states that "Verizon Wireless shall distribute to the approximately 15 million Affected Customers
credits or refunds totaling approximately $52.8 million". It also requires Verizon Wireless to pay a fine (nominally a "voluntary contribution") of $25 Million.

Mignon ClyburnFCC Commissioner Mignon Clyburn (at left) stated in a release that "This month, the FCC has taken actions that send an important message about how seriously this agency takes its public interest obligation to protect consumers. In both the Bill Shock Notice of Proposed Rulemaking, which we adopted on October 14, and today’s Consent Decree with Verizon Wireless, the Commission’s initial examination demonstrated that voluntary steps to resolve the issues that wireless consumers identified in their complaints were insufficient and warranted further inquiry."

The FCC adopted and released this Notice of Proposed Rulemaking (NPRM) [32 pages in PDF] at its October 14, 2010, open meeting. See, story titled "FCC Adopts Bill Shock NPRM" in TLJ Daily E-Mail Alert No. 2,142, October 19, 2010.

The Consent Decree also requires Verizon Wireless to better train and supervise its employees, to create a "Data Charge Task Force", to provide customers "plain-language description" of its data charges, and to provide periodic compliance reports to the FCC.

Chris Riley of the Free Press stated in a release that "resolution of this action does not correct the fundamental problems that plague the wireless industry. Only in Washington can a company secretly fleece its own customers for years, get caught, initially deny the behavior, and then settle for a modest sum."

He continued that "These phantom fees should never have been levied in the first place -- and they could have been prevented by pro-consumer rules protecting against bill shock and ensuring transparency in billing practices. Importantly, Verizon would not have been willing to settle were the Commission not poised to pass rules against such practices. Threats of regulation have a very short shelf life if not consummated. If the FCC does not move forward on its pending proceedings on bill shock and truth-in-billing to establish common-sense rules of the road to protect consumers and prevent deception, the abuses of the past will recur, and consumers will be no better off in the long run."

Cablevision and News Corp. Write FCC Regarding Retransmission Consent

10/26. Cablevision and News Corp. sent letters to the Federal Communications Commission (FCC) responding to its letter [PDF] of October 22, 2010, regarding their not having negotiated a new retransmission consent agreement.

The FCC asked the two companies to "describe with specificity what has transpired since you initially began your negotiations, and detail the efforts your company is making to end the current impasse. If you are aware of any conduct by the other side that you believe violates the good faith requirement, please so indicate and provide supporting evidence". See, story titled "FCC Asks News Corp. and Cablevision for Information" in TLJ Daily E-Mail Alert No. 2,146, October 25, 2010.

See, Cablevision letter [17 pages in PDF] of October 25, 2010 and letter [2 pages in PDF] of October 26. See also, Fox/News Corp.'s letter [8 pages in PDF] of October 25 and letter [8 pages in PDF] of October 26.

Cablevision states that News Corp. "has negotiated in utter bad faith" and FCC "intervention at this point -- through mediation, arbitration, or any other process through which an independent entity determines a fair price -- is the only practical solution".

Fox/News Corp. states that it has negotiated in good faith, and that "Once Cablevision realizes that it has to negotiate with Fox, rather than the government, they will hopefully come back to the table and begin negotiating again in earnest."

Corie Wright of the Free Press stated in a release that there is a "market failure" and that the FCC "needs to fix this broken system and ensure that consumers are not caught in the crossfire of future spats between media giants.

She continued that "Transparency is critical to a functioning market, and the fact that neither side wants to discuss the industry's cost structure shows how badly this market is broken. To inject some much needed sunlight into the system, the FCC should force broadcasters and cable companies to publicly disclose the prices and terms of each and every channel. In this case, the FCC should require that Cablevision disclose how much it currently pays for Fox and other networks on a per-customer basis. Fox should be required to disclose how much it currently receives from Cablevision and how much it is asking for now. With mandated transparency, consumers can judge for themselves whether Fox is asking for a fair price for its content."

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In This Issue
This issue contains the following items:
 • FTC Ends Investigation of Google WiFi Intercepts
 • Rep. Barton Seeks Chairmanship of House Commerce Committee
 • Verizon Wireless to Pay Fine and Give Refunds for Overbilling Customers
 • Cablevision and News Corp. Write FCC Regarding Retransmission Consent
Washington Tech Calendar
New items are highlighted in red.
Thursday, October 28

The House is in recess until November 15.

The Senate is in recess until November 12, except for pro forma sessions.

2:40 PM. The Federal Trade Commission's (FTC) Bureau of Economics will host a presentation titled "Supersize It: The Growth of Retail Chains and the Rise of the Big Box Retail Format". The speaker will be Emek Basker (University of Missouri) one co-author of a paper [PDF] with the same title. For more information, contact Loren Smith at lsmith2 at ftc dot gov or Tammy John at tjohn at ftc dot gov. Location: ground floor Conference Center, 601 New Jersey Ave., NW.

4:00 - 5:30 PM. Vivek Wadhwa will give lecture titled "What is a Tech Entrepreneur, and How Can We Make More of Them?". This event is free and open to the public. To register, e-mail iep dot gmu at gmail dot com. Location: Room 120, George Mason University School of Law, 3301 Fairfax Drive, Arlington, VA.

7:00 - 9:30 PM. The Federal Communications Bar Association's (FCBA) Young Lawyers Committee and the FCBA Foundation will host an event titled "21st Annual Charity Auction". For more information, contact Micah Caldwell at FCBAAuction at gmail dot com. Location: Hamilton Crowne Plaza Hotel, 1315 K St., NW.

Deadline to register for the two day event hosted by the National Institute of Standards and Technology (NIST) titled "Cloud Computing Forum & Workshop II". See, event web page and notice in the Federal Register, October 19, 2010, Vol. 75, No. 201, at Page 64258.

Friday, October 29

9:00 AM. The Arizona State University (ASU) will host an event titled "Can Open Innovation Regain America's Competitive Edge?". The speakers will include Diana Wells (Ashoka), Amy Stursberg (Blackstone Charitable Foundation), Jim Whitehurst (Red Hat, Inc.), Santokh Badesha (Xerox), Matthew Von Ertfelda (Marriot International), Chris Thomas (Intel), Mitzi Montoya (ASU), Rob Pegoraro (Washington Post), and Michael Crow (ASU). See, notice. For more information, contact Kate Wells, 602-703-5231 or kate dot wells at asu dot edu. Location: Ballroom, 13th floor, National Press Club, 529 14th St., NW.

9:00 - 10:30 AM. The Washington International Trade Association (WITA) will host a panel discussion titled "Anti-Counterfeiting Trade Agreement Update". The speakers will be Kira Alvarez (OUSTR), Ed Black (CCIA), Emery Simon (BAA), and Bruce Wilson (King & Spalding). See, notice. Location: Horizon Ballroom, Ronald Reagan Building and International Trade Center, 1300 Pennsylvania Ave., NW.

12:15 - 1:30 PM. The Federal Communications Commission (FCC) and Federal Communications Bar Association's (FCBA) Mass Media and Video Programming and Distribution Committees will host a brown bag lunch titled "Perspectives from the FCC Media Bureau". The FCBA bars reporters from some of its events. Location: National Association of Broadcasters, 1771 N St., NW.

5:00 PM. Deadline to submit comments to the Department of Commerce's (DOC) International Trade Administration's (ITA) Office of Intellectual Property Rights (OIPR) regarding protecting intellectual property rights abroad. See, notice in the Federal Register, September 30, 2010, Vol. 75, No. 189, at Pages 60408-60409, and story titled "Department of Commerce Commences Review of Foreign Barriers to Protection of IPR" in TLJ Daily E-Mail Alert No. 2,137, October 1, 2010.

Saturday, October 30

Deadline to submit comments to the National Institute of Standards and Technology's (NIST) Computer Security Division (CSD) regarding its draft SP 800-56 C [13 pages in PDF] titled "Recommendation for Key Derivation through Extraction then Expansion".

Monday, November 1

Deadline to submit comments to the Federal Trade Commission (FTC) in response to its notice in the Federal Register requesting comments on how to conduct a survey on consumer fraud. See, Federal Register: September 1, 2010, Vol. 75, No. 169, at Pages 53697-53699.

Tuesday, November 2

Election Day.

8:30 AM - 3:15 PM. The National Institute of Standards and Technology's (NIST) Technology Innovation Program (TIP) Advisory Board will meet. See, notice in the Federal Register, October 8, 2010, Vol. 75, No. 195, at Page 62369. NIST, Advanced Measurement Laboratory, Building 215, Room C103, Gaithersburg, MD.

10:00 AM. The Supreme Court will hear oral argument in Schwartzenegger v. Entertainment Merchants Association, Sup. Ct. No. 08-1448, a petition for writ of certiorari to the U.S. Court of Appeals (9thCir). The question presented is s California state statute that prohibit the sale of violent video games to minors under 18 violates the First Amendment. See, Supreme Court docket, and 9th Circuit's February 20, 2009, opinion. See also, story titled "9th Circuit Holds California Video Games Statute Unconstitutional" in TLJ Daily E-Mail Alert No. 1,902, February 23, 2009; story titled "Supreme Court Grants Cert in Video Game 1st Amendment Case" in TLJ Daily E-Mail Alert No. 2,081, April 30, 2010; and, story titled "California Files Brief with Supreme Court in Video Games First Amendment Case" in TLJ Daily E-Mail Alert No. 2,104, July 14, 2010.

1:00 - 2:30 PM. The American Bar Association (ABA) will host a webcast and teleconferenced panel discussion titled "Lawyer Websites: Ethical Traps and How to Avoid Them". See, notice. Prices vary. CLE credits.

Wednesday, November 3

7:30 AM - 1:30 PM. The National Journal will host a post election day conference titled "The Day After". See, notice and registration page. This event is free. Location: Grand Hyatt Washington, Independence Ballroom, 1000 H St., NW.

8:30 AM - 4:30 PM. Day one of a two day meeting of the National Archives and Records Administration's (NARA) Advisory Committee on the Electronic Records Archives (ACERA). See, notice in the Federal Register, October 14, 2010, Vol. 75, No. 198, at Pages 63208-63209. Location: NARA, 700 Pennsylvania Ave., NW.

9:00 AM - 4:30 PM. Day one of a three day meeting of the National Institute of Standards and Technology's (NIST) Information Security and Privacy Advisory Board (ISPAB). See, notice in the Federal Register, September 23, 2010, Vol. 75, No. 184, at Pages 57904-57905. Location: Marriott Hotel Washington, 1221 22nd St., NW.

9:00 AM. Day one of a two day partially closed meeting of the Department of Commerce's (DOC) Bureau of Industry and Security's (BIS) Information Systems Technical Advisory Committee. The agenda includes discussion of "Fault Tolerant Computer" and "Intel Technology Roadmap". See, notice in the Federal Register, October 19, 2010, Vol. 75, No. 201, at Pages 64258-64259. Location: DOC, Room 3884, 1401 Constitution Ave., NW.

2:00 - 4:00 PM. Day one of a three day meeting of the National Science Foundation's (NSF) Directorate for Mathematical and Physical Sciences Advisory Committee. See, notice in the Federal Register, October 13, 2010, Vol. 75, No. 197, at Page 62891. Location: NSF, Room 1005, 4201 Wilson Blvd., Arlington, VA.

6:00 - 9:15 PM. The DC Bar Association will host a panel discussion titled "Introduction to Export Controls". The speakers will be Thomas Scott (Ladner & Associates) and Carol Kalinoski. The price to attend ranges from $89 to $129. Reporters are barred from attending most DC Bar events. CLE credits. See, notice. For more information, call 202-626-3488. Location: DC Bar Conference Center, 1101 K St., NW.

Deadline to submit initial comments to the Copyright Office (CO) in response to its notice of proposed rulemaking (NPRM) regarding "whether a cable operator may receive refunds in situations where it has failed to pay for the carriage of distant signals on a system-wide basis under the Copyright Act, before it was amended to allow a cable system to calculate its royalty fees on a community-by-community basis." See, original notice in the Federal Register, October 4, 2010, Vol. 75, No. 191, at Pages 61116-61118, and correction notice in the Federal Register, October 12, 2010, Vol. 75, No. 196, at Page 62488. See also, story titled "Copyright Office Issues NPRM Regarding Refunds Under the Cable Statutory License" in TLJ Daily E-Mail Alert No. 2,140, October 11, 2010.

Thursday, November 4

8:00 AM - 6:00 PM. Day two of a three day meeting of the National Science Foundation's (NSF) Directorate for Mathematical and Physical Sciences Advisory Committee. See, notice in the Federal Register, October 13, 2010, Vol. 75, No. 197, at Page 62891. Location: NSF, Room 1235, 4201 Wilson Blvd., Arlington, VA.

8:30 AM - 5:00 PM. Day two of a three day meeting of the National Institute of Standards and Technology's (NIST) Information Security and Privacy Advisory Board (ISPAB). See, notice in the Federal Register, September 23, 2010, Vol. 75, No. 184, at Pages 57904-57905. Location: Marriott Hotel Washington, 1221 22nd St., NW.

9:00 AM - 4:30 PM. Day one of a two day meeting of the National Archives and Records Administration's (NARA) Advisory Committee on the Electronic Records Archives (ACERA). See, notice in the Federal Register, October 14, 2010, Vol. 75, No. 198, at Pages 63208-63209. Location: NARA, 700 Pennsylvania Ave., NW.

9:00 AM. Day two of a two day partially closed meeting of the Department of Commerce's (DOC) Bureau of Industry and Security's (BIS) Information Systems Technical Advisory Committee. The agenda includes discussion of "Fault Tolerant Computer" and "Intel Technology Roadmap". See, notice in the Federal Register, October 19, 2010, Vol. 75, No. 201, at Pages 64258-64259. Location: DOC, Room 3884, 1401 Constitution Ave., NW.

9:30 AM. The Department of Commerce's (DOC) Bureau of Industry and Security's (BIS) Transportation and Related Equipment Technical Advisory Committee will hold a partially closed meeting. See, notice in the Federal Register, October 20, 2010, Vol. 75, No. 202, at Page 64700. Location: DOC, Room 6087B, 1401 Constitution Ave., NW.

9:30 AM - 5:00 PM. The President's Council of Advisors on Science and Technology (PCAST) will hold a partially closed meeting. See, notice in the Federal Register, October 12, 2010, Vol. 75, No. 196, at Page 62612. Location: Keck Center of the National Academies, 500 5th St., NW.

RESCHEDULED FOR NOVEMBER 30. 10:30 AM. The Federal Communications Commission (FCC) may hold an event titled "open meeting". Location: FCC, Commission Meeting Room, 445 12th St., SW.

12:00 NOON - 1:30 PM. The National Economists Club will host a lunch. The speaker will be William Reinsch (National Foreign Trade Council). His topic is "Recreating a 21st Century Trade Policy". Prices vary. Location: Darlington House, 1610 20th St., NW.

1:00 - 4:00 PM. The Federal Communications Commission's (FCC) Technological Advisory Council will hold its first meeting. See, FCC release and story titled "FCC Creates Technological Advisory Council" in TLJ Daily E-Mail Alert No. 2,145, October 22, 2010. Location: FCC, Commission Meeting Room, 445 12th St., SW.

TIME? Day one of a two day event hosted by the National Institute of Standards and Technology (NIST) titled "Cloud Computing Forum & Workshop II". See, event web page, and notice in the Federal Register, October 19, 2010, Vol. 75, No. 201, at Page 64258. This event is free. The deadline to register is October 28, 2010. Location: NIST, Red Auditorium, 100 Bureau Drive, Gaithersburg, MD.

Day one of a two day event hosted by the U.S. Patent and Trademark Office (USPTO) titled "Independent Inventors Conference". Location: USPTO, Alexandria, VA.