7/3. The US SAFE WEB Act is scheduled to sunset next year. The House Commerce Committee (HCC) announced that its Subcommittee on Commerce, Manufacturing and Trade will hold a hearing on July 12 on a yet to be introduced bill that would extend this sunset. See, HCC notice.

This Act increased the investigatory and information sharing powers of the Federal Trade Commission (FTC). For example, the Act gave the FTC new powers to compel third party service providers to disclose the contents of stored wire and electronic communications, without notice to the owner of the communications, and with a gag order imposed upon the service provider.

The Act also contains a seven year sunset provision. It provides that it "shall cease to have effect on the date that is 7 years after the date of enactment of this Act". President Bush signed it into law on December 22, 2006.

The bill was S 1608 [109th Congress], the "Undertaking Spam, Spyware, And Fraud Enforcement With Enforcers beyond Borders Act". This title renders the near acronym of US SAFE WEB Act. It is now Public Law No. 109-455.

See, stories titled "Congress Expands Powers of FTC" in TLJ Daily E-Mail Alert No. 1,504, December 13, 2006, and "Senate Commerce Committee Approves Bill to Expand FTC Powers to Pursue Online Fraud" in TLJ Daily E-Mail Alert No. 1,274, December 16, 2006. See also, FTC summary [3 pages in PDF] of the Act.

This Act gave the FTC new powers that enhanced its ability to fight internet based fraud that crosses international borders. However, this Act also affected a wide range of other civil fraud and criminal law enforcement investigations and proceedings.

Section 5 of the FTC Act, which is codified at 15 U.S.C. § 45, provides, in part, that "Unfair methods of competition in or affecting commerce, and unfair or deceptive acts or practices in or affecting commerce, are hereby declared unlawful"

The 2006 Act expanded the definition of "unfair or deceptive acts or practices" to include "acts or practices involving foreign commerce that -- (i) cause or are likely to cause reasonably foreseeable injury within the United States; or (ii) involve material conduct occurring within the United States."

The 2006 Act also added a new subsection to 15 U.S.C. § 46, which pertains to "Additional powers of Commission". The new subsection 46(j) is titled "Investigative Assistance for Foreign Law Enforcement Agencies". It enumerates numerous powers to assist foreign agencies, including the conducting of investigations in the US. However, these new powers do not apply to common carrier activities, or to foreign governments that assist terrorists.

The 2006 Act also added a new subsection 46(k) that authorizes the sharing of information with domestic and foreign criminal enforcement agencies when the FTC has "evidence that any person, partnership, or corporation, either domestic or foreign, has engaged in conduct that may constitute a violation of Federal criminal law".

The 2006 Act also amended 15 U.S.C. § 57b-2, which pertains to "Confidentiality". It amended subsection 57b-2(b)(6) to provide broader sharing of information with foreign agencies investigating such things as "fraudulent or deceptive commercial practices" and "foreign criminal laws".

The 2006 Act also expanded the subsection 57b-2 Freedom of Information Act (FOIA) exemption for FTC investigation information. It expanded the exemption to include information acquired from foreign sources, including "any material obtained from a foreign law enforcement agency or other foreign government agency, if the foreign law enforcement agency or other foreign government agency has requested confidential treatment, or has precluded such disclosure under other use limitations, as a condition of providing the material".

The 2006 Act also created a new section of the FTC Act titled "Confidentiality and Delayed Notice of Compulsory Process for Certain Third Parties".

The 2006 Act provided that "The procedures for delay of notification or prohibition of disclosure under the Right to Financial Privacy Act (12 U.S.C. 3401 et seq.) and chapter 121 of title 18, United States Code, including procedures for extensions of such delays or prohibitions, shall be available to the Commission ..." (Parentheses in original.)

Chapter 121 of Title 18 is the Stored Communications Act (SCA).

The SCA provides, at 18 U.S.C. § 2705, that the government can get from a court "an order delaying the notification required under section 2703(b) of this title for a period not to exceed ninety days". 18 U.S.C. § 2703(b) provides, in part, that "A governmental entity may require a provider of remote computing service to disclose the contents of any wire or electronic communication ..."

The 2006 Act provided that the FTC can obtain from the court "an order delaying notification or prohibiting disclosure" if the court "finds that there is reason to believe that such notification or disclosure may cause an adverse result". In addition, the service provider is immune from liability for failure to notify its customers, even liability under "contract or other legally enforceable agreement, for failure to provide notice to any person that such process has been issued".

The 2006 Act also provided that "All judicial proceedings initiated by the Commission under the Right to Financial Privacy Act (12 U.S.C. 3401 et seq.), chapter 121 of title 18, United States Code, or this section may be brought in the United States District Court for the District of Columbia or any other appropriate United States District Court." (Parentheses in original.)

That is, the FTC is free to seek orders compelling disclosure of information from service providers and financial institutions in fora that are distant and inconvenient to the service providers and financial institutions.

Also, the 2006 Act provided that upon application of the FTC "all judicial proceedings pursuant to this section shall be held in camera and the records thereof sealed until expiration of the period of delay or such other date as the presiding judge or magistrate judge may permit".

6/21. Sen. Pat Toomey (R-PA) and others introduced S 3333 [LOC | WW], an information security and data breach notification bill.

This bill was referred to the Senate Commerce Committee (SCC). The original cosponsors of this bill are Sen. Olympia Snowe (R-ME), Sen. Jim DeMint (R-SC), Sen. Roy Blunt (R-MO), and Sen. Dean Heller (R-NV).

There are no Democratic cosponsors.

Sen. Toomey stated in a release that "A number of recent high-profile data breaches combined with the messy patchwork of 46 different state laws highlight how difficult it is for consumers to know their personal information is secure. Congress needs to provide businesses and consumers with certainty and establish a single reasonable standard for information security and breach notification practices. Our bill would eliminate the burden of complying with varying standards and laws, ensuring that all consumers and their personal information are afforded the same level of protection".

Michael Powell, head of the National Cable and Telecommunications Association (NCTA), praised this bill in a release. He wrote that "This important legislation instructs, in a straightforward manner, when and how notification is required in the event of a security breach of computerized data that includes personal information. We also appreciate that the bill takes the long-overdue step of establishing a level playing field that treats cable on the same basis as other covered entities."

Tim McKone, AT&T's EVP of Federal Relations, stated in a release that "The security of our customers' personal information is of utmost importance to us and is a priority in how we conduct our business. That is why we are pleased by Senator Toomey’s thoughtful and comprehensive bill, the ‘Data Security and Breach Notification Act of 2012.’  It is a common sense bill that will eliminate uncertainties and ultimately consumer confusion by establishing uniform requirements."

Information Security. The bill addresses both information security and data breach notification. However, Section 2 of the bill, which treats information security, is a single sentence.

It provides that "Each covered entity shall take reasonable measures to protect and secure data in electronic form containing personal information."

Data Breach Notification. The bill then addresses in greater detail, in Section 3, data breach notification.

The bill would mandate that "A covered entity that owns or licenses data in electronic form containing personal information shall give notice of any breach of the security of the system following discovery by the covered entity of the breach of the security of the system to each individual who is a citizen or resident of the United States whose personal information was or that the covered entity reasonably believes to have been accessed and acquired by an unauthorized person and that the covered entity reasonably believes has caused or will cause, identity theft or other financial harm."

In addition, "A covered entity shall notify the Secret Service or the Federal Bureau of Investigation of the fact that a breach of security has occurred if the number of individuals whose personal information the covered entity reasonably believes to have been accessed and acquired by an unauthorized person exceeds 10,000."

Also, the bill contains special requirements for data breaches involving third party agents and service providers.

Section 3 also addresses the method, timing and content of notifications.

Definitions. Section 5 contains definitions. It provides that with exemptions for entities already regulated by the Gramm Leach Bliley Act (GLBA) or the Health Insurance Portability and Accountability Act of 1996 (HIPAA), a "covered entity" means "a sole proprietorship, partnership, corporation, trust, estate, cooperative, association, or other commercial entity that acquires, maintains, stores, or utilizes personal information".

Also, with exclusions for encrypted data, and public record information, "personal information" means "an individual's first name or first initial and last name in combination with any one or more of the following data elements for that individual: (i) Social Security number. (ii) Driver's license number, passport number, military identification number, or other similar number issued on a government document used to verify identity. (iii) Financial account number, or credit or debit card number, and any required security code, access code, or password that is necessary to permit access to an individual's financial account."

Enforcement. Section 4 addresses enforcement. The bill gives the Federal Trade Commission (FTC) enforcement authority. Violations would be treated as unfair or deceptive trade practices.

The bill does not reference the promulgation of regulations.

The bill expressly provides that "Nothing in this Act shall be construed to establish a private cause of action against a person for a violation of this Act."

Preemption of CA/FCC Regulatory Regime. While this bill does not regulate the information security and data breach notification practices of entities already regulated by the GLB Act or HIPAA, it does expressly apply to entities regulated by the Communications Act and Federal Communications Commission (FCC) rules.

The bill provides that "Sections 222, 338, and 631 of the Communications Act of 1934 (47 U.S.C. 222, 338, and 551), and any regulations promulgated thereunder, shall not apply with respect to the information security practices, including practices relating to the notification of unauthorized access to data in electronic form, of any covered entity otherwise subject to those sections." (Parentheses in original.)

47 U.S.C. § 222 pertains to carriers' customer proprietary network information (CPNI).

47 U.S.C. § 338, at subsection (i), addresses "Privacy rights of satellite subscribers".

47 U.S.C. § 551 pertains to the collect and use of personally identifiable information by cable operators.

Preemption of State Law. This bill provides that "This Act preempts any law, rule, regulation, requirement, standard, or other provision having the force and effect of law of any State, or political subdivision of a State, relating to the protection or security of data in electronic form containing personal information or the notification of a breach of security."

6/26. The Senate confirmed Robin Rosenbaum to be a Judge of the U.S. District Court (SDFl) by a vote of 92-3. See, Roll Call No. 167.

6/25. President Obama nominated Sheri Chappell to be a Judge of the U.S. District Court (MDFl). See, White House news office release and release. She has been a US Magistrate Judge for the Middle District of Florida for nine years.

6/25. President Obama nominated Katherine Failla to be a Judge of the U.S. District Court (SDNY). See, White House news office release and release. She has been an Assistant U.S. Attorney for the last 12 years.

6/25. President Obama nominated Troy Nunley to be Judge of the U.S. District Court (EDCal). See, White House news office release and release. He has been a trial court judge in Sacramento, California, for the last ten years.

6/26. Sen. Orrin Hatch (R-UT), a senior member of the Senate Judiciary Committee (SJC), won the Republican Utah primary election. He will be the Republican candidate for the US Senate in the November 6 general election.

6/25. Facebook announced in a release that Sheryl Sandberg joined its Board of Directors. She is the company's Chief Operating Officer. The other directors are Mark Zuckerberg, Marc Andreessen (Andreessen Horowitz), Erskine Bowles, James Breyer (Accel Partners), Donald Graham (Ch/CEO of the Washington Post Company), Reed Hastings (Ch/CEO of Netflix), and Peter Thiel.

6/25. President Obama designated Irving Williamson as Chair of the U.S. International Trade Commission (USITC) for the term expiring June 16, 2014. See, letter to Congress.

The House will not meet on the week of Monday, July 2, through Friday, July 6.

The Senate will not meet on the week of Monday, July 2, through Friday, July 6.

12:00 NOON - 2:00 PM. The Federalist Society will host an event titled "2012 Annual Supreme Court Round Up". The price to attend is $50. Lunch will be served. Location: Mayflower Hotel, 1127 Connecticut Ave., NW.

The House will meet at 2:00 PM. The schedule for the week may include consideration of HR 4402 [LOC | WW], the "National Strategic and Critical Minerals Production Act of 2012".

The Senate will meet at 2:00 PM.

10:00 AM. The U.S. Court of Appeals (FedCir) will hear oral argument in Rembrandt Technologies v. Cablevision Systems, App. Ct. No. 2012-1022. See, Federal Circuit calendar. Location: Courtroom 201.

10:00 AM. The U.S. Court of Appeals (FedCir) will hear oral argument in Liquidnet Holdings v. Pulse Trading, App. Ct. No.2011-1508, an appeal from the U.S. District Court (SDNY). See, Federal Circuit calendar. Location: Courtroom 402.

2:00 PM. The House Foreign Affairs Committee's (HFAC) Subcommittee on Africa, Global Health and Human Rights will hold a hearing titled "Continued Human Rights Attacks on Families in China". See, notice. Location: Room 2200, Rayburn Building.

3:00 - 5:00 PM. The American Enterprise Institute (AEI) will host a speech by Keith Alexander (Director of the National Security Agency) "Cybersecurity and American Power: Addressing New Threats to America's Economy and Military". The AEI notice states that this event will focus on "Chinese hackers". Location: AEI, 12th floor, 1150, 17th St., NW..

Deadline to submit comments to the Copyright Office (CO) regarding its proposed rules changes regarding the filing of notices of intention to obtain a compulsory license, pursuant to 17 U.S.C. § 115. The CO proposes to provide an option for electronically filing the notice. Comments are due by 5:00 PM on July 9, 2012. See, notice in the Federal Register (FR), Vol. 77, No. 102, Friday, May 25, 2012, at Pages 31237-31240.

Deadline to submit initial comments to the Federal Communications Commission (FCC) in response to its Further Notice of Proposed Rulemaking (NPRM) [182 pages in PDF] regarding its collection of universal service taxes. The FCC adopted this item on April 27, 2012, and released the text on April 30. It is FCC 12-46 in WC Docket Nos. 06-122 and GN Docket No. 09-51. See, notice in the Federal Register, Vol. 77, No. 110, Thursday, June 7, 2012, at Pages 33896-33944.

10:00 AM. The Senate Banking Committee (SBC) will hold a hearing titled "Developing the Framework for Safe and Efficient Mobile Payments, Part 2". See, notice. Location: Room 538, Dirksen Building.

10:15 AM. The House Commerce Committee's (HCC) Subcommittee on Communications and Technology (SCT) will hold an oversight hearing on the Federal Communications Commission (FCC). The witnesses will be the five Commissioners of the FCC. See, notice. Location: Room 2123, Rayburn Building.

10:00 AM - 3:00 PM. The Department of Health and Human Services' (DHHS) Office of the National Coordinator for Health Information Technology 's HIT Policy Committee will meet. See, notice in the Federal Register, Vol. 77, No. 120, Thursday, June 21, 2012, at Pages 37407-37408. Location: Renaissance Washington, DC DuPont Circle Hotel, 1143 New Hampshire Ave., NW.

1:00 - 2:00 PM. The American Bar Association's (ABA) Section of Antitrust Law will host a webcast presentation titled "Privacy & Information Security Update". The speakers will be Aryeh Friedman (Dun & Bradstreet), Edward McNicholas (Sidley Austin), and Elisa Jillson (Sidley Austin). No CLE credits. See, ABA notice.

2:30 PM. The Senate Intelligence Committee (SIC) will hold a closed hearing or mark up titled "Intelligence Matters". See, notice. Location: Room 219, Hart Building.

9:30 AM. The Senate Judiciary Committee (SJC) will hold a hearing titled "Oversight of the Impact on Competition of Exclusion Orders to Enforce Standard-Essential Patents". See, notice. Location: Room 226, Dirksen Building.

10:00 AM. The House Judiciary Committee's (HJC) Subcommittee on Crime, Terrorism, and Homeland Security will hold a hearing titled "National Security Leaks and the Law". See, notice. Location: Room 2141, Rayburn Building.

10:00 AM - 12:00 NOON. The Heritage Foundation (HF) will host two panels titled "Scholars & Scribes Review the Rulings: The Supreme Court's 2011-2012 Term". The speakers will be Donald Verrilli (Solicitor General of the US), Richard Epstein (NYU law school), Michael Carvin (Jones Day), Edwin Meese (HF), David Savage (Los Angeles Times and Chicago Tribune), Mark Sherman (The Associated Press), Howard Bashman (How Appealing), and Todd Gaziano (HF). See, notice. Location: HF, 214 Massachusetts Ave., NE.

10:00 AM. The U.S. Court of Appeals (FedCir) will hear oral argument in Technology Patents v. Deutsche Telekom, App. Ct. No. 2011-1581. See, Federal Circuit calendar. Location: Courtroom 402.

12:00 NOON - 1:30 PM. The Technology Policy Institute (TPI) will host an event titled "The Effect of File Sharing on Music and Movie Sales: Reviewing the Research". Stan Liebowitz (University of Texas at Dallas) will present a paper titled "The Metric is the Message: How much of the Decline in Sound Recording Sales is due to File-Sharing?" See, notice. Location: First Amendment Lounge, National Press Club, 529 14th St., NW.

1:00 - 2:00 PM. The American Bar Association (ABA) will host a webcast and teleconferenced presentation titled "Recent Developments in Insider Trading and Market Abuse Regulation in the US, UK/EU and Asia". The speakers will be Edward Greene (Cleary Gottlieb), Manfred Ketzer (Hausmaninger Kletter), Piyasena Perera (Anderson Mori & Tomotsune), and Cheryl Nichols (Howard University School of Law). Prices vary. See, ABA notice.

1:00 - 2:00 PM. The American Bar Association (ABA) will host a panel discussion titled "Summer Associate and Intern Panel on Advertising, Privacy, and Consumer Protection Law: Exciting Career Opportunities in an Emerging Practice". The speakers will be Daniel Blynn (Kelley Drye & Warren), Katherine Campbell (FTC), Sang Lee (DOJ), Adrienne Fowler (DOJ), Kristin McPartland (Kelley Drye & Warren), and David Conway (Venable). No CLE credits. See, notice. Location: Bryan Cave, 1155 F St., NW.

1:00 PM. The DC Bar Association will host a panel discussion titled "The Politics of Copyright". The speakers will be Ernesto Falcon (Public Knowledge), Susan Ferrechio (D.C. Examiner), James Losey (New America Foundation), and Paige Gold. The price to attend ranges from $10 to $45. No CLE credits. See, notice. For more information, call 202-626-3488. The DC Bar has a history of barring reporters from its events. Location: DC Bar Conference Center, 1101 K St., NW.

6:00 PM. Deadline to submit short form applications to the Federal Communications Commission's (FCC) Wireless Telecommunications Bureau (WTB) and Wireline Competition Bureau (WCB) in connection with Auction 901. This is the reverse auction, scheduled to commence on September 27, 2012, to award $300 Million in one time Mobility Fund Phase I support scheduled to commence on September 27, 2012. See, notice in the Federal Register, Vol. 77, No. 105, Thursday, May 31, 2012, at Pages 32092-32111.

6:00 - 8:00 PM. The Federal Communications Bar Association's (FCBA) Young Lawyers Committee will host an event titled "Trivia Night". For more information, contact Matt Gerst at MGerst at ctia dot org or Justin Faulb at Faulb at lojlaw dot com. Location: Laughing Man Tavern, 1306 G St., NW.

10:00 AM. The House Commerce Committee's (HCC) Subcommittee on Commerce, Manufacturing and Trade will hold a hearing on HR __, a yet to be introduced bill to reauthorize the U.S. SAFE WEB Act. This Act, which sunsets in December, increases the investigatory and information sharing powers of the Federal Trade Commission (FTC). See, notice. Location: Room 2322, Rayburn Building.

10:00 AM. The Senate Judiciary Committee (SJC) will hold an executive business meeting. The agenda again includes consideration of the nominations of Terrence Berg (USDC/EDMich), Jesus Bernal (USDC/CDCal), and Lorna Schofield (USDC/SDNY). See, notice. The SJC will webcast this meeting. Location: Room 226, Dirksen Building.

10:00 AM. The U.S. Court of Appeals (FedCir) will hear oral argument in Cy Technology v. Groupon, App. Ct. No. 2011-1568. See, Federal Circuit calendar. Location: Courtroom 201.

10:00 AM. The U.S. Court of Appeals (FedCir) will hear oral argument in Function Media v. Google, App. Ct. No. 2012-1020. See, Federal Circuit calendar. Location: Courtroom 402.

12:00 NOON - 1:15 PM. The American Bar Association (ABA) will host a webcast and teleconferenced presentation titled "The JOBS Act in Ninety Minutes: What Business Lawyers Need to Know". See, HR 3606 [LOC | WW], the "Jumpstart Our Business Startups Act", an act that reduces regulatory burdens to increase access to the public capital markets for emerging growth companies. President Obama signed it into law on April 5, 2012. It is now Public Law No. 112-106. CLE credits. Prices vary. See, notice.

2:30 PM. The Senate Intelligence Committee (SIC) will hold a closed hearing or mark up titled "Intelligence Matters". See, notice. Location: Room 219, Hart Building.

4:00 - 7:15 PM. The DC Bar Association will host a presentation titled "Antitrust Investigations: Tactical and Ethical Issues". The speakers will be Ray Hartwell (Hunton & Williams), Donald Klawiter (Sheppard Mullin), and Ann O'Brien (DOJ Antitrust Division). 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.

The House will not meet.

10:00 AM. The U.S. Court of Appeals (FedCir) will hear oral argument in Fox Group v. Cree, App. Ct. No. 2011-1576, an appeal from the U.S. District Court (EDVA). See, Federal Circuit calendar. Location: Courtroom 201.

10:00 AM. The U.S. Court of Appeals (FedCir) will hear oral argument in Apple v. USITC, App. Ct. No. 2011-1592. See, Federal Circuit calendar. Location: Courtroom 201

12:00 NOON - 1:00 PM. The American Bar Association (ABA) will host a teleconferenced presentation titled "June Antitrust Update for In-House Counsel". No CLE credits. See, notice.

Deadline to submit initial comments to the Federal Communications Commission (FCC) in response to its Public Notice [MS Word], DA 12-818, regarding the privacy and data security practices of mobile wireless services providers with respect to customer information stored on their users' mobile communications devices. See also, notice in the Federal Register, Vol. 77, No. 114, Wednesday, June 13, 2012, at Pages 35336-35338.

Tech Law Journal publishes a free access web site and a subscription e-mail alert. The basic rate for a subscription to the TLJ Daily E-Mail Alert is $250 per year for a single recipient. There are discounts for subscribers with multiple recipients.

Free one month trial subscriptions are available. Also, free subscriptions are available for federal elected officials, and employees of the Congress, courts, and executive branch. The TLJ web site is free access. However, copies of the TLJ Daily E-Mail Alert are not published in the web site until two months after writing.

For information about subscriptions, see subscription information page.

Tech Law Journal now accepts credit card payments. See, TLJ credit card payments page.

TLJ is published by David Carney
Contact: 202-364-8882.
carney at techlawjournal dot com
3034 Newark St. NW, Washington DC, 20008.

Privacy Policy
Notices & Disclaimers
Copyright 1998-2012 David Carney. All rights reserved.