House Approves NSF Authorization Bill
6/5. The House approved HR 4664,
the Investing in America's Future Act, a bill to authorize appropriations for
the National Science Foundation, by a vote of
397-25. See, Roll
Call No. 212.
HR 4664 would authorize the appropriation of $5.5 Billion for FY 2003 for the
NSF. Included in the funding authorization is $704 Million for networking and
information technology research, $238 Million for the Nanoscale Science and
Engineering Priority Area, and $60 Million for the Mathematical Sciences
The bill authorizes an increase in funding for the NSF of 15% in FY 2003, and
similar increases in future years. If the funding authorized by this bill were
actually appropriated, it would double the NSF's budget within five years.
The bill is sponsored by Rep. Nick
Smith (R-MI) and others. It was reported by the House Science Committee on May 22.
Rep. Sherwood Boehlert (R-NY),
Chairman of the Committee, stated during the floor debate that "When we
look at the new fields of science and engineering that will boost our economy in
this new century, fields like nanotechnology, where do we turn to ensure that
our nation's researchers stay at the cutting edge? NSF. When we look at the
field of information technology, which facilitates every activity in today's
economy, where do we turn to ensure that the U.S. remains at the cutting edge?
NSF. When we consider our ever more urgent need for a highly skilled,
technologically literate workforce, where do we turn to ensure that our
education system from kindergarten through post-graduate work is preparing the
people we need? NSF. We turn to NSF to solve some of our most pressing problems;
we can't turn from NSF when we decide where to invest federal funds. It's time
to give NSF the money it needs."
Rep. Boehlert also pointed out that the bill is backed by tech groups, such as
the Semiconductor Industry Association
The bill only authorizes the appropriation of funds. Whether the House Appropriations Committee
will actually appropriate this level of funding is another question.
See, HR 4664
[PDF], as reported by the Subcommittee on Research on May 9. The full Committee
approved one amendment
[PDF] on May 22 offered by Rep. Boehlert. It authorizes the appropriation of $50
Million for the Advanced Technological Education Program established under the
Scientific and Advanced Technology Act of 1992, and $30 Million for the Minority
Serving Institutions Undergraduate Program.
House Subcommittee Holds Hearing on UWB
6/5. The House Commerce Committee's
Subcommittee on Telecommunications and the Internet held a hearing titled
"The FCC's UWB Proceeding: An Examination of the Government's Spectrum
statement of Rep. Billy Tauzin
(R-LA), Chairman of the full Committee. See also, prepared testimony of
Knapp (Deputy Chief of the FCC's Office of
Engineering and Technology), Michael
Gallagher (Deputy Assistant Secretary of Commerce, NTIA), Stephen
Price (Deputy Assistant Secretary for Spectrum, Space, Sensors and C3
Policy, Department of Defense), Jeff
Shane (Department of Transportation), Richard
Nowakowski (Chicago Office of Emergency Communications R&D), Ralph
Petroff (Time Domain Corporation), Dennis
Johnson (Geophysical Survey Systems).
Sen. Lieberman Introduces Broadband Bill
6/5. Sen. Joe Lieberman
(D-CT) introduced a bill titled the National
Broadband Strategy Act of 2002, a bill that would require the President to
adopt a broadband strategy.
Sen. Lieberman stated in the Senate that "I rise today to introduce what I
believe will be a roadmap to revitalization. It's premised on the extraordinary
promise of high speed Internet to help us return to high intensity growth;
by revolutionizing the way we communicate and live our lives. Its goal is to
highlight the challenges we face in tapping the transformative potential of
broadband technology, to spur agreement on a national strategy for accelerating
its development and deployment, and ultimately to help bring on what we all hope
will be the broadband boom." See, transcript.
However, this bill has only one substantive provision -- a requirement that the
President develop a broadband policy. The bill provides that "Not later
than six months after the date of the enactment of this Act, the President shall
submit to Congress a report setting forth a strategy for the nationwide
deployment of high speed broadband Internet telecommunications services."
Sen. Lieberman also said that he will introduce more broadband related
legislation later. He stated that "The follow-up legislation I'll propose
in the coming months will call on the FCC to develop a regulatory framework to
meet the challenges of the next generation Net ... propose tax credits for the
deployment of advanced broadband ... encourage research and development on
advanced broadband infrastructure that will enable this technology to reach into
all the corners and crevices of the country ... and present a program to
incentivize research and development on major applications in areas where
government plays a central role, including education, healthcare, and
e-government." (Dots in original.)
Cal App Affirms Conviction for Knowingly Accessing and Taking
Data from a Computer
6/5. The California
Court of Appeal (6) issued its opinion [PDF]
v. David Hawkins, affirming a conviction for the felony of
knowingly accessing and taking data from a computer system.
The defendant, David Hawkins, was charged with taking the source code of his
former employer Network Translation Incorporated (NTI). Cisco Systems acquired NTI in 1995, and Hawkins
then worked for Cisco until August of 1996. Hawkins later worked on the
development of an application that was similar to a Cisco product. San Jose
police officers executed a search warrant for Hawkin's apartment. They found NTI
source code on one of his computers. Police investigators further determined
that these source code files had been accessed after he stopped working for
Hawkins was charged with misappropriating a trade secret (California Penal Code
§ 499) and knowingly accessing and taking data from a computer system (§ 502(c)(2)).
The trial jury returned a verdict of not guilty on the trade secret charge.
However, he was convicted on the § 502 charge.
Section 502(c)(2) of
the California Penal Code provides "... any person who commits any of the
following acts is guilty of a public offense ... (2) Knowingly accesses and
without permission takes, copies, or makes use of any data from a computer,
computer system, or computer network, or takes or copies any supporting
documentation, whether existing or residing internal or external to a computer,
computer system, or computer network."
On appeal, Hawkins argued that his crime should not be a felony because § 502(c)(2)
lacks a mens rea requirement, that the statute is unconstitutionally vague, and
that the trial court erred in admitting evidence of prior misconduct and in
admitting printouts of computer access times.
The Appeals Court affirmed. It wrote that the requirement that defendant act
"knowingly" satisfies the mens rea requirement. On the vagueness
argument, the Appeals Court concluded that the statute is "sufficiently
clear to avoid constitutional problems". The Appeals Court also found no
error in the admission of evidence of prior misconduct (that Hawkins had also
possessed proprietary source code of Sun Microsystems on his computer), or in
the admission of the printouts of access times.
People and Appointments
6/5. The Cellular Telecommunications &
Internet Association (CTIA) elected its new Board of Directors and Executive
Committee for 2002-2003. Tim Donahue of Nextel will be Chairman, Scott
Ford of ALLTEL will be Vice Chairman, Terry Addington of First
Cellular of Southern Illinois will be Treasurer, and Mikal Thomsen of
Western Wireless will be Secretary. Two new Board members were also named: Robert
Dawson of Southern LINC and Mick Mullagh of Telephia.
DC Circuit Rules in Global Naps v. FCC
6/4. The U.S.
Court of Appeals (DCCir) issued its opinion
Naps v. FCC, a petition for review of a Federal Communications Commission (FCC) order
refusing to preempt the regulatory authority of Massachusetts Department of
Telecommunications and Energy (DTE) in a matter regarding the interpretation
of the reciprocal compensation provisions of an interconnection agreement
between Global NAPs and Verizon. The Court
rejected the petition.
Global NAPs is a local exchange carrier (LEC) in Massachusetts and other states.
Verizon is the incumbent local exchange carrier (ILEC) in Massachusetts. Global
NAPs and Verizon entered into an interconnection agreement that provides for
reciprocal compensation (i.e., for completing local calls made by customers of
one company to customers of the other). Many of Global NAPs' customers are
Internet Service Providers (ISPs).
Global NAPs sought a declaratory ruling from the DTE that ISP bound traffic is
subject to reciprocal compensation under this interconnection agreement. Global
NAPs then petitioned the FCC to preempt DTE's jurisdiction and decide the
question. Before the FCC responded, the DTE issued an order dismissing GNAPs'
claim as moot in light of the DTE's decision that ISP bound calls were not local
within the meaning of an identically worded interconnection agreement between
Verizon and MCI WorldCom.
The FCC then concluded that the DTE had not failed to act to carry out its
responsibility under 47
U.S.C. § 252 and, therefore, that preemption was not warranted. Global NAPs
then filed the present petition for review.
The Appeals Court rejected the petition. The Court held that "the FCC's
conclusion that § 252(e)(5) does not empower it to look behind a state
agency's dismissal of a carrier's claim to evaluate the substantive validity of
that dismissal is both a reasonable interpretation of that provision and
consistent with the Commission's past practices and precedents."
Fed Circuit Rules on Patent Unenforceability Due to Failure to
Name an Inventor
6/4. The U.S.
Court of Appeals (FedCir) issued its opinion in Frank's
Casing Crew and Rental Tools v. PMR Technologies, a patent case
involving failure by named inventors to list a true inventor, and
unenforceability due to inequitable conduct by named inventors in failing to
name an inventor.
This action involves U.S.
Patent No. RE 34,063, which is directed to a method and apparatus for
monitoring torque while connecting threaded tubular goods; it has utility in oil
and gas drilling. PMR obtained a license to it shortly after its issuance in
1992. PMR then attempted to sell licenses to the patent to oil and gas
companies. PMR also sent cease and desist letters. One letter was sent to
Frank's Casing Crew and Rental Tools.
Frank's Casing then filed a complaint in U.S.
District Court (WDLa) against PMR seeking a declaratory judgment that the
'063 patent is invalid, unenforceable, and not infringed. Others actions were
instituted, and consolidated into this one action.
The District Court held that an inventor had been omitted. It further found that
the parties who prosecuted the patent had engaged in inequitable conduct by
failing to name this person as an inventor. It further found that they
deliberately omitted him from the patent and acted to hide his involvement in
the invention throughout the patent prosecution process. As a result, the
District Court held the patent unenforceable.
The Appeals Court affirmed the District Court's findings that a true inventor of
at least one of the '063 patent claims was not named on the patent, and that the
'063 patent was unenforceable because of inequitable conduct during its
prosecution. However, the Appeals Court remanded to the District Court for the
limited purpose of determining the correct inventorship of the patent.
Nader Writes OMB Re Government Software Procurement
6/4. Ralph Nader and Jamie Love, of the Consumer
Project on Technology, wrote a letter to Mitch Daniels,
Director of the Office of Management
and Budget (OMB), regarding federal government procurement of Microsoft
software. The letter both asks for information from the OMB, and makes
suggestions for using procurement policies to promote competition.
The letter states that "OMB should consider if Microsoft should be required
(as a matter of procurement policy) to fully disclose the file formats of its
office productivity and multimedia programs, so that the data created in such
programs could be reliably read by non-Microsoft software."
The letter also states that "OMB should consider a cost benefit analysis to
determine whether dominant software providers should make their source code
public, in order to enhance interoperability with products offered by smaller
competitors" and that "OMB should consider if limits on the number of
purchases from any one firm would enhance competition for PC operating systems
and office productivity tools, and if such enhanced competition would have
significant benefits in terms of licensing fees."
APEC Ministers Issue Statement Regarding New Economy and IPR
6/4. Asia Pacific Economic Cooperation (APEC) trade ministers met in Puerto
Vallarta, Mexico, on May 29-30. They issued a statement
which contains some technology and intellectual property rights (IPR) related
The statement provides that "Ministers emphasized the positive impact of
the new economy on growth and development. In this regard, Ministers welcomed
Officials' work to identify key trade policies on services liberalization and
tariff and intellectual property regimes that support the new economy, and
reviewed their report on the exchange on trade policy information in these
It states that "Ministers also discussed ways to improve IPR enforcement,
including Japan's proposal to establish an IPR Service Centre Network, and
instructed Officials to continue their discussion in order to report the
proposal of appropriate mechanism by next Ministerial Meeting. Ministers called
on APEC members to encourage wide participation from business sector in the
upcoming "APEC Seminar on Venture Capital and Start-up Companies" to
be held in Beijing in December this year."
SEC Commissioner Addresses Fake Scam Web Sites
6/4. Securities and Exchange Commission (SEC)
Glassman gave a speech
at a Federal Deposit Insurance Corporation
(FDIC) symposium on Enhancing Financial Transparency, held in Washington DC.
She discussed, among other topics, the SEC's use of the fake scam web sites to
educate investors. She stated that "In January 2002, the SEC launched a
fake ``scam´´ website to warn investors about fraud before they lose
their money. Anyone who tried to invest was greeted with an educational message
that warns of potential scams. Within weeks of its launch, the site got more
than 1.5 million hits, and our Office of Investor Education and Assistance
received more than 500 emails, nearly all of which were overwhelmingly positive.
We have launched two additional fake scam websites and plan to create more in
the months ahead."
Rep. Capuano Writes FCC Re Classification of Cable Modem
Service as Interstate Information
6/4. Rep. Michael Capuano (D-MA)
wrote a letter
[PDF] to the Federal Communications Commission
(FCC) regarding its notice of proposed rulemaking (NPRM) titled
"Appropriate Regulatory Treatment for Broadband Access to the Internet over
He wrote that "It is my understanding that on March 15, 2002, the FCC
issued a Declaratory Ruling that found cable modem service provided on a cable
system should be classified as an ``interstate information service´´. This
ruling has broad implications for the ability of local communities to regulate
He argued that "the NPRM will drastically impact the ability of local
governments to charge franchise fees based on cable modem service revenues. This
creates economic hardship for thousands of cities and towns, many already
struggling with revenue shortfalls. In addition, it will also deny these
communities the opportunity to recoup the expense of providing right of way for
The FCC announced its Declaratory
Ruling and Notice of Proposed Rulemaking [PDF] at its meeting on March 14.
It released the 75 page document on March 15. It addresses the legal
classification and the appropriate regulatory framework for broadband access to
the Internet over cable system facilities. The vote was three to one.
Commissioner Michael Copps
wrote strenuous dissent.
This is GN Docket No. 00-185 and CS Docket No. 02-52. See also, FCC
The FCC concluded "that cable modem service, as it is currently offered, is
properly classified as an interstate information service, not as a cable
service, and that there is no separate offering of telecommunications service.
In addition, we initiate a rulemaking proceeding to determine the scope of the
Commission's jurisdiction to regulate cable modem service and whether (and, if
so, how) cable modem service should be regulated under the law ..."
The DR & NPRM further states that "The Communications Act does not
clearly indicate how cable modem service should be classified or
regulated", but nevertheless "conclude[s] that cable modem service as
currently provided is an interstate information service, not a cable service,
and that there is no separate telecommunications service offering to subscribers
This declaratory ruling is also the subject of petitions for review pending in
the U.S. Court of Appeals.
Reps. Tauzin and Upton Write FCC Re Cross Ownership Rule
6/4. Rep. Billy Tauzin (R-LA) and Rep. Fred Upton (R-MI) wrote a letter
to Federal Communications Commission (FCC)
Chairman Michael Powell
urging the FCC to repeal its newspaper broadcast cross ownership rule.
The two argued that much has changed since the rule was promulgated in 1975,
when "there were 7,785 radio stations, 952 television stations, three major
broadcast networks (ABC, CBS, and NBC), cable television systems served 13 per
cent of television households, direct broadcast satellite (DBS) providers were
nonexistent, and the Internet was not commercially available."
The two wrote that today, "there are approximately 12,900 radio stations,
1,600 full power television stations, 2,390 low power television stations, and
230 Class A television stations. There are now four major broadcast networks
(ABC, CBS, NBC, and Fox), along with other emerging broadcast networks (e.g.,
UPN and WB). Today, cable television systems serve approximately 70 per cent of
television households (with over 200 video programming services available on
such systems, including significant news programming). Today, DBS is serving
approximately 15 per cent of multichannel video programming distribution (MVPD)
They added that "the Internet also has become a significant source of local
and national news for many Americans."
"We believe this explosion of media sources should eliminate any concern
regarding a lack of diversity of views in the marketplace and competition, which
have been the principal justifications for the rule", they concluded.
The FCC released a Notice of
Proposed Rulemaking (NPRM) [PDF] on September 20, 2001 on this matter. It is
MM Docket 01-235. Rep. Tauzin is Chairman of the House Commerce Committee; Rep. Upton
is Chairman of the Telecommunications and the Internet Subcommittee.
House to Vote on NSF Authorization Bill
6/4. The House will likely debate and vote on HR 4664,
the Investing in America's Future Act, on Wednesday, June 5. The bill is
sponsored by Rep. Nick Smith
(R-MI) and others. The House Science
Committee amended and approved the bill on May 22.
HR 4664 would authorize the appropriation of $5.5 Billion for FY 2003 for the National Science Foundation (NSF). Included in
the funding authorization is $704 Million for networking and information
technology research, $238 Million for the Nanoscale Science and Engineering
Priority Area, and $60 Million for the Mathematical Sciences Priority Area.
The bill authorizes an increase in funding for the NSF of 15% in FY 2003, and
similar increases in future years. If the funding authorized by this bill were
actually appropriated, it would double the NSF's budget within five years.
See, HR 4664
[PDF], as reported by the Subcommittee on Research on May 9. The full Committee
approved one amendment
[PDF] on May 22 offered by Rep.
Sherwood Boehlert (R-NY). It authorizes the appropriation of $50 Million for
the Advanced Technological Education Program established under the Scientific
and Advanced Technology Act of 1992, and $30 Million for the Minority Serving
Institutions Undergraduate Program.
House Crime Subcommittee Approves Information Sharing Bill
6/4. The House Judiciary Committee's
Subcommittee on Crime held a hearing and a mark up session for HR 4598,
the Homeland Security Information Sharing Act, sponsored by Rep. Saxby Chambliss (R-GA). The
Subcommittee approved the bill with minor technical amendments. The full
Committee is currently scheduled to mark up the bill on Friday, June 7. The
purpose of this bill is to provide for increased sharing of federal government
information relating to homeland security with state and local governments.
People and Appointments
6/4. California Governor Gray Davis announced the appointments of Marcel Poché
Tondreau as Judges of the Santa Clara County Superior Court. Poché was
appointed to the Santa Clara County Superior Court in 1977, and to the Court of
Appeal in 1979. He retired in 2000. Tondreau is a partner in the Santa Clara law
firm of McTernan Stender Walsh Weingus
6/4. Peggy Binzel, EVP of the National
Cable & Telecommunications Association (NCTA) will leave the NCTA on
June 30 to become CEO of CoreNet Global, an Atlanta based professional
association representing corporate real estate executives. See, release.
6/4. The Department of Education published a notice
in the Federal Register regarding applying for Community Technology Centers
Program grants for Fiscal Year 2002 to create or expand community technology
centers that provide disadvantaged residents of economically distressed urban
and rural communities with access to information technology and related
training. The deadline for submitting applications is July 19, 2002. See,
Federal Register, June 4, 2002, Vol. 67, No. 107, at Pages 38555 - 38577.
SEC Brings and Settles Improper Accounting Charges Against
6/3. The Securities and Exchange Commission
(SEC) instituted an administrative proceeding against Microsoft alleging
violation of federal securities law in connection with its accounting practices
from 1995 through 1998.
instituting the proceeding alleges that "During Microsoft's fiscal years
ended June 30, 1995, June 30, 1996, June 30, 1997 and June 30, 1998 (the
``relevant period´´), Microsoft maintained undisclosed reserves, accruals,
allowances and liability accounts (collectively ``reserves´´ or ``reserve
accounts´´) that (a) were not in conformity with generally accepted accounting
principles (``GAAP´´) to a material extent, and/or (b) lacked properly
documented support and substantiation, as required by the federal securities
The Order also states that "Microsoft failed to maintain internal controls
that were adequate under the federal securities laws. Specifically, during the
relevant period, Microsoft maintained between approximately $200 million and
$900 million in unsupported and undisclosed reserves, a significant portion of
which did not comply with GAAP, which resulted in material inaccuracies in
filings made by Microsoft with the Commission."
Microsoft and the SEC simultaneously settled the matter. Microsoft admitted no
wrongdoing. The SEC imposed no fine or other penalty. Microsoft also stated in a
that "The agreement has no impact on Microsoft’s reported financial
results; no restatement of any reported financial results is required and no
penalty has been assessed."
Stephen Cutler, Director of the SEC's Division of Enforcement
stated in a release that
"This case emphasizes that the Commission will act against a public company
that issues financial statements with material inaccuracies, even in the absence
of fraud charges".
Supreme Court Rules on Appellate Jurisdiction of Federal
6/3. The Supreme
Court issued its opinion
[PDF] in Holmes
Group v. Vornado Air Circulation Systems, a case regarding the
appellate jurisdiction of the U.S. Court of
Appeals for the Federal Circuit. The Supreme Court held that when a
complaint does not allege a claim arising under federal patent law, but the
answer contains a counterclaim based upon federal patent law, the Federal
Circuit does not have appellate jurisdiction.
Lower Court Proceedings. Holmes Group filed a complaint in U.S. District Court (DKan) against Vornado Air Circulation Systems
seeking a declaratory judgment that its products did not infringe Vornado's
trade dress and an injunction restraining Vornado from accusing it of trade
dress infringement in promotional materials. Vornado's answer asserted a
compulsory counterclaim alleging patent infringement.
The District Court granted Holmes the declaratory judgment and injunction it
sought. Vornado appealed to the Federal Circuit. Holmes challenged the
jurisdiction of the Federal Circuit. However, the Federal Circuit rejected the
argument, and vacated and remanded. The Supreme Court granted certiorari on the
issue of jurisdiction.
Relevant Statutes. 47 U.S.C. § 1338
provides, in part, that "The district courts shall have original
jurisdiction of any civil action arising under any Act of Congress relating to
patents, plant variety protection, copyrights and trademarks. Such jurisdiction
shall be exclusive of the courts of the states in patent, plant variety
protection and copyright cases."
47 U.S.C. § 1295(a),
in turn, provides, in part, that "The United States Court of Appeals for
the Federal Circuit shall have exclusive jurisdiction (1) of an appeal from a
final decision of a district court of the United States ... if the jurisdiction
of that court was based, in whole or in part, on section 1338 of this title
Supreme Court. The Supreme Court reversed. It wrote that " Section
1338(a) uses the same operative language as 28 U. S. C. §1331, the statute
conferring general federal question jurisdiction, which gives the district
courts ``original jurisdiction of all civil actions arising under the
Constitution, laws, or treaties of the United States. ... The well- pleaded-
complaint rule has long governed whether a case ``arises under´´ federal law
for purposes of §1331.´´ ... As ``appropriately adapted to §1338(a),´´ the
well- pleaded- complaint rule provides that whether a case ``arises under´´
patent law ``must be determined from what necessarily appears in the plaintiff's
statement of his own claim in the bill or declaration. ... The plaintiff's well
pleaded complaint must ``establis[h] either that federal patent law creates the
cause of action or that the plaintiff's right to relief necessarily depends on
resolution of a substantial question of federal patent law ...´´ ... Here, it
is undisputed that petitioner's well pleaded complaint did not assert any claim
arising under federal patent law. The Federal Circuit therefore erred in
asserting jurisdiction over this appeal." (Citations omitted.)
The Supreme Court also rejected the argument that it should give different
meaning to "arising under" in determining Federal Circuit jurisdiction
because of Congress' goal of promoting uniformity of patent law. The Court wrote
that "Our task here is not to determine what would further Congress' goal
of ensuring patent-law uniformity, but to determine what the words of the
statute must fairly be understood to mean."
It added that "It would be an unprecedented feat of interpretive necromancy
to say that §1338(a)'s ``rising under´´ language means one thing (the
wellpleaded- complaint rule) in its own right, but something quite different
(respondent's complaint- or- counterclaim rule) when referred to by §1295(a)(1)."
(Justice Antonin Scalia wrote the opinion of the Court.)
The Court concluded that "Not all cases involving a patent-law claim fall
within the Federal Circuit's jurisdiction. By limiting the Federal Circuit's
jurisdiction to cases in which district courts would have jurisdiction under §1338,
Congress referred to a well- established body of law that requires courts to
consider whether a patent-law claim appears on the face of the plaintiff's well
pleaded complaint. Because petitioner's complaint did not include any claim
based on patent law, we vacate the judgment of the Federal Circuit and remand
the case with instructions to transfer the case to the Court of Appeals for the
Supreme Court Vacates and Remands in Nine Cases Following
6/3. The Supreme
Court granted certiorari in nine cases, following its May 28 landmark opinion
[PDF] in Festo
v. Shoketsu Kinzoku Kogyo Kabushiki. In each case the Supreme
Court merely vacated and remanded to the U.S.
Court of Appeals (FedCir).
Festo is a patent case regarding the doctrine of equivalents and the rule of
prosecution history estoppel. The unanimous Supreme Court reversed the Court of
Appeals and remanded. The Court again affirmed the doctrine of equivalents,
articulated its purpose, held that the narrowing of a patent claim may give rise
to prosecution history estoppel (but that it does not absolutely bar application
of the doctrine of equivalents), and listed circumstances under which it might
or might not operate as a bar.
In each of the nine orders granting certiorari, the Supreme Court wrote this:
"The petition for a writ of certiorari is granted. The judgment is vacated
and the case is remanded to the United States Court of Appeals for the Federal
Circuit for further consideration in light of Festo Corp. v. Shoketsu Kinzoku
Kogyo Kabushiki Co., 535 U.S. __ (2002)."
The nine cases are Pioneer Magnetics, Inc. v. Micro Linear Corp., No. 00-1765,
Instituform Technologies v. Cat Contracting, No. 00-1946, Senior Technologies,
Inc. v. R.F. Technologies, Inc., No. 01-35, Creo Products, Inc. v. Dainippon
Screen, No. 01-269, Semitool, Inc. v. Novellus Systems, Inc., No. 01-423,
Lockheed Martin Corp. v. Space Systems/Loral, Inc., No. 01-506, Accuscan, Inc.
v. Xerox Corp., No. 01-541, PTI Technologies, Inc. v. Pall Corp. Techn., Inc.,
No. 01-677, and Mycogen Plant Science v. Monsanto Company, No. 01-740. See, Order
More Supreme Court News
6/3. The Supreme Court denied certiorari in Hagenbuch v. Compaq, No. 01-1448,
and Circuit City Stores v. Adams, No. 01-1460. See, Order
List [PDF] at page 6.
6/3. The Supreme Court announced that it will be on recess until Monday, June
GAO Releases Report on Government Use of Social Security
6/3. The General Accounting Office (GAO)
released a report [PDF]
titled "Social Security Numbers: Government Benefits from SSN Use but Could
Provide Better Safeguards".
The report discussed the benefits of government use of SSNs. "When federal,
state, and county government agencies administer programs that deliver services
and benefits to the public, they rely extensively on the SSNs of those receiving
the benefits and services. Because SSNs are unique identifiers and do not
change, the numbers provide a convenient and efficient means of managing
records. They are also particularly useful for data sharing and data matching
because agencies can use them to check or compare their information quickly and
accurately with that from other agencies. In so doing, these agencies can better
ensure that they pay benefits or provide services only to eligible individuals
and can more readily recover delinquent debts individuals may owe."
The report continued that "While government agencies are making wide use of
SSNs, they are also taking some steps to safeguard the numbers; however, certain
measures that could help protect SSNs are not uniformly in place at any level of
government. First, when requesting SSNs, government agencies are not
consistently providing individuals with information required by federal law.
This information, such as how the SSNs will be used and whether individuals are
required to provide their SSNs, is the first line of defense against improper
disclosure because it allows SSN holders to make informed decisions about
whether to provide their SSN to obtain the services in question. Second, ... our
survey identified potential weaknesses in the security of information systems at
all levels of government."
The report then addressed the use of SSNs in identity theft. "This growth
in the use of SSNs is important to individual SSN holders because these numbers,
along with names and birth certificates, are among the three personal
identifiers most often sought by identity thieves. Identity theft ... occurs
when an individual steals another individual's personal identifying information
and uses it fraudulently."
The report also states that "identity thieves most often gained access to
this personal information by taking advantage of an existing relationship with
the victim. The next most common means of gaining access were by stealing
information from purses, wallets, or the mail. In addition, individuals can also
obtain SSNs from their workplace and use them or sell them to others. Finally,
SSNs and other identifying information can be obtained legally through Internet
sites maintained by both the public and private sectors and from records
routinely made available to the public by government entities and courts."
NTIA Seeks Comments on Internet Filtering Technologies
6/3. The National Telecommunications and
Information Administration (NTIA) published in its web site a release
and a notice
[PDF] requesting comments on the effectiveness of Internet blocking and
filtering technologies. Comments are due by August 27, 2002.
§ 1703 of the Children's
Internet Protection Act (CIPA) [PDF] directs the NTIA to initiate a notice
and comment proceeding to evaluate whether currently available Internet blocking
or filtering technology protection measures and Internet safety policies
adequately address the needs of educational institutions. It also directs NTIA
to make recommendations to Congress on how to foster the development of
technology protection measures that meet these needs.
The NTIA published a notice in the Federal Register last week regarding this
proceeding. See, Federal Register, May 29, 2002, Vol. 67, No. 103, at Pages
37396 - 37398.
On May 31, a three judge panel of the U.S.
District Court (EDPenn) issued its opinion
in American Library Association v. U.S., finding
unconstitutional library related provisions of the CIPA. The Act requires, among
other things, that schools and libraries receiving e-rate subsidies certify that
they are using a "technology protection measure" that prevents library
users from accessing "visual depictions" that are "obscene,"
"child pormography," and in the case of minors, "harmful to
minors." However, the CIPA, as it applies to schools, remains unaffected by
this opinion. Also, the Court did not find unconstitutional Section 1703,
requiring the NTIA to conduct this evaluation.
FCC Seeks Comments on Study of Horizontal Concentration Among
6/3. The Federal Communications Commission
(FCC) published a paper [121
pages in PDF] titled "Horizontal Concentration in the Cable Television
Industry: An Experimental Analysis".
The paper examines the effects of changes in horizontal concentration among
cable operators on the flow of video programming to consumers. It is based on an
experimental economics study in which experiment participants played the roles
of actual market participants.
The paper was written by Mark Bykowsky and William Sharkey of the FCC's Office of Plans and Policy, and Anthony
Kwasnica of Pennsylvania State University. The paper is also known as OPP
Working Paper Series 35.
In addition, the FCC's Media Bureau
announced that it is seeking public comment on the study. Comments are due by
July 18. Reply comments are due by August 2. See, notice
USPTO Releases Strategic Plan
6/3. The U.S. Patent and Trademark Office (USPTO)
released a document titled The
21st Century Strategic Plan [18 pages in PDF]. USPTO Director James Rogan states in the
introduction that this plan "is our road map for transformation. It lays
out exactly what we will do over the next five years to reduce to 18 months the
total time it takes to receive a patent, to make both patent and trademark
processes almost paperless, and to work with intellectual property offices
around the world to create a global framework for enforceable intellectual
"The time has come to transform the USPTO from a one size fits all
government bureaucracy into a quality focused, responsive, market driven
intellectual property institution," wrote Rogan.
The plan states that the USPTO will "Achieve an average time to first
action in patent applications that is more than 50 percent lower than the time
projected in the 2003 Business Plan ; i.e., 5.8 months in 2008 rather than 12.3
months." It states that the USPTO will "Achieve and maintain 18 months
patent pendency by 2008". The plan also states that the USPTO will
"Competitively source classification and search functions, and concentrate
Office expertise as much as possible on the core government functions."
Electronic Processing of Applications. "As a first priority, we have
made electronic end to end processing of both patents and trademarks the
centerpiece of our business model." The plan then promises to "Deliver
an operational system to process patent applications electronically by October
1, 2004, including electronic image capture of all incoming and outgoing paper
documents" and to "Develop an automated information system to support
a post grant patent review process."
Pendency. The plan states that it will "ensure a steady 18-month
average pendency time in Patents -- by far the fastest in the world -- and a
12-month pendency time in Trademarks. This will be accomplished through a
radical redesign of the entire patent search and examination system based upon
four examination tracks, greater reliance on commercial service providers, and
variable, incentive driven fees."
Four Track Process. The plan states that the USPTO will "Move from a
``one size fits all´´ patent examination process to a four track examination
process that leverages search results of other organizations and permits
applicants to have freedom of choice in the timing of the processing of their
applications. This new process will eliminate duplication of effort, encourage
greater participation by the applicant community and public, permitting
lapse of applications when examination is not requested, and improving the
quality of our patents and decreasing processing time."
Rocket Docket. It also states that the USPTO will "Offer patent
applicants the market driven ``new rocket docket´´ option of choosing an
accelerated examination procedure with priority processing and a pendency time
of no longer than 12 months."
Fee Schedule. To facilitate these changes, the USPTO will "Seek
legislation to restructure the USPTO fee schedule by October 1, 2002, and
thereby create incentives and disincentives that contribute to achievement of
USPTO goals, for example, the filing fee will be reduced to incentivize
applicants to file, and a separate examination fee will be established to permit
applicants to choose the timing for examination."
Post Grant Review. The plan states that the USPTO will "Make patents
more reliable by proposing amendments to patent laws to improve a post
grant review of patents."
Congressional Action Needed. Implementation of the plan will require
changes at the USPTO, including the promulgation of rules. However, it is also
contingent upon Congressional action. The plan states that "We will need
enactment of legislation by the Congress to adjust certain patent and trademark
fees by October 1, 2002. ... We will need enactment of an appropriation for
fiscal year 2003 that is consistent with the level of the President’s 2003
budget." Legislation would also be required to change the post grant review
People and Appointments
6/3. Jane Cobb was named Director for the Securities
and Exchange Commission's (SEC) Office of Legislative Affairs. She replaces
Casey Carter. Peter Kiernan was named Deputy Director. See, SEC release.
6/3. Robert Dellinger was named EVP and Chief Financial Officer of Sprint. He replaces Arthur Krause, who
retired. See, release.
6/3. Karan Bhatia was named Deputy Under Secretary for Industry and
Security at the Department of Commerce's (DOC)
Bureau of Industry and Security, which was
formerly known as the Bureau of Export Administration. The DOC stated in a release
that Bhatia "will advise and assist the Under Secretary in overseeing all
aspects of Bureau management and policymaking, including the administration and
enforcement of dual-use export controls, promoting the assurance of public and
private sector critical infrastructures, ensuring compliance with U.S.
antiboycott laws, and ensuring the viability of the U.S. defense industrial
base." He has been Chief Counsel for Export Administration since July 2001.
Before that, he was a partner in the law firm of Wilmer Cutler & Pickering.
6/3. Alan Nugent was named Chief Technology Officer of Novell. See, release.
Microsoft Publishes Essay on Digital Copyrights
6/3. Microsoft published in its web site an essay
titled "Art & Commerce in the Digital Decade: Protecting intellectual
property will take cooperation and innovation". It states that "At
stake is the continued growth of the digital economy. Copyright holders --
authors, musicians, filmmakers, software developers and others -- will be able
to take full advantage of the Internet as a powerful distribution channel only
if their creations are appropriately protected." The essay argues that
"a government mandated standard could actually hinder anti-piracy efforts
by stifling technical innovation." It concludes that "A more effective
solution would be for entertainment companies to invest in digital distribution.
Few companies have made much content available online, yet the popularity of
file sharing among music fans suggests that the market is large. Making
legitimate content available easily and affordably would help to counter the
6/1. President Bush gave a graduation speech
at West Point. He stated that "The gravest danger to freedom lies at the
perilous crossroads of radicalism and technology."
Go to News from May 26-31, 2002.