House Commerce Committee Seeks Corporate Governance Records
7/5. Rep. Billy Tauzin (R-LA) and Rep. Jim Greenwood (R-PA) sent a
letter to 13 companies asking for information pertaining to corporate governance
and financial reporting. The recipients include WorldCom, Tyco,
Global Crossing, Xerox, Qwest,
Adelphia, Peregrine Systems and MicroStrategy.
Rep. Tauzin is Chairman of the House
Commerce Committee, which is investigating questionable financial accounting
practices, and board of directors oversight of corporate management. Rep.
Greenwood is Chairman of the Subcommittee on Oversight and Investigations.
The letter states that the Committee "is undertaking a comprehensive review
of corporate governance in light of the alarming number of recent business
accounting scandals and failures. Specifically, we are reviewing the extent and
quality of management oversight by the boards of directors of several of the
companies now in crisis. A thorough examination of this matter is vital to
restore confidence in American business and financial markets."
The letter includes both a detailed request for production of documents, and
interrogatories. It requests documents and information pertaining to the current
and past members of the boards or directors, policies of the boards of
directors, external auditors, reviews of external auditors, reviews of
management, communications with the SEC, presentations to the boards of
directors, and other matters.
On July 2 Rep. Tauzin and Rep. Greenwood wrote a letter
to Securities and Exchange Commission (SEC)
Chairman Harvey Pitt
requesting information and documents pertaining to the SEC's investigations of
the accounting practices of WorldCom, Tyco, Global Crossing, Xerox, and Qwest
On June 5 Reps. Tauzin and Greenwood wrote another letter to Chairman Pitt which
expands the companies covered, from five, to the thirteen above referenced
Shakeup at Qwest
7/5. Drake Tempest, Qwest Communications EVP
and General Counsel, stated in a release
that "We have no reason to believe that we are the subject of any
investigation by the U. S. Department of Justice ... It's outrageous that we
would learn about such an investigation through the media. We have disclosed
everything asked of us and have cooperated fully with the Securities Exchange
Commission and Congress".
7/7. Qwest announced the replacement of Robin Szeliga as Chief Financial
Officer. Oren Shaffer, who was formerly CFO of Ameritech, joined Qwest as
Vice Chairman and CFO. See, Qwest
7/7. Qwest also announced that Gary Lytle will replace Pete Belvin
as VP for Policy and Law. Lytle was interim President of the U.S. Telecom Association (USTA) in 2000 and
2001. Before that, he was VP for federal relations at Ameritech.
7/5. The Federal Communications Commission
(FCC) published a notice
[PDF] in its web site that it has adopted a revised Schedule of Regulatory Fees
on July 3. However, it did not publish the Schedule of Regulatory Fees.
7/5. The World Intellectual Property Organization
(WIPO) published online a database
containing information about cybersquatting cases before the WIPO Arbitration and Mediation Center.
The WIPO Center is a dispute resolution service provider under the Uniform Domain Name Dispute Resolution
Policy (UDRP) of the Internet Corporation for Assigned Names and Numbers (ICANN).
See also, WIPO
FCC Releases Annual CMRS Report
7/3. The Federal Communications Commission
(FCC) released its 7th
annual report [140 pages in PDF] on CMRS competition. The FCC adopted this
report back on June 13. It is titled "Annual Report and Analysis of
Competitive Market Conditions With Respect to Commercial Mobile Services".
The report concludes that "In the year 2001, the CMRS industry continued to
experience increased competition, innovation, lower prices for consumers, and
increased diversity of service offerings. The year saw a number of operators
continue to fill in gaps in their national coverage through mergers,
acquisitions, license swaps, and joint ventures. In parallel with this process
of footprint building, mobile telephone operators continue to deploy their
networks in an increasing number of markets, expand their digital networks, and
develop innovative pricing plans."
The report also contains the FCC's detailed assessment (at pages 53-80) of the
state the technology and deployment of mobile data services. The report states
that "Estimates of the number of mobile Internet users at the end of 2001
range from approximately 8 to 10 million, up from 2 to 2.5 million at the end of
This section of the report addresses 3G wireless technologies, personal data
assistants (PDAs), PDA operating systems, smartphones, paging mobile data,
mobile web browsing, e-mail, server access, location based services, Bluetooth,
802.11, and telemetry and telematics.
People and Appointments
7/3. Greg Jenner was named Senior Advisor and Acting Deputy Assistant
Secretary for Tax Policy at the Department of the Treasury, effective July 8,
2002. Jenner was a partner in the Tax and Legislative Groups at the Venable law firm. Prior to that, he was a partner
with Price Waterhouse Coopers. Before
that, he worked in the Treasury Department in the first Bush administration. And
before that, he worked for the Senate Finance Committee. See, Treasury release.
WorldCom: Rep. Tauzin Requests Information From SEC
7/2. Rep. Billy Tauzin (R-LA) and Rep. Jim Greenwood (R-PA) wrote a letter
to Securities and Exchange Commission (SEC)
Chairman Harvey Pitt
requesting information and documents pertaining to the SEC's investigations of
the accounting practices of WorldCom, Tyco, Global Crossing, Xerox, and Qwest
For example, they asked, "For the period from January 1998 through the date
upon which the SEC began its current formal inquiry into the company, did the
SEC review any of the 10-Qs or 10-Ks filed by the company? If so, identify the
filings reviewed, provide a brief description of the reviews conducted, and
provide all records relating to such reviews."
Rep. Tauzin is Chairman of the House
Commerce Committee. Rep. Greenwood is Chairman of its Subcommittee on
Oversight and Investigations.
WorldCom: Sen. Grassley Questions SEC and WorldCom About
7/2. Sen. Charles Grassley (R-IA)
wrote two letters
[PDF] to Securities and Exchange Commission
(SEC) Chairman Harvey
Pitt and WorldCom President John
Sidgmore asking for information about large bonuses paid recently to WorldCom
officers, directors and employees.
Sen. Grassley stated to Pitt: "I commend you for taking action that bars
WorldCom from paying its officers, directors or employees more than $100,000 in
severance. It appears that many top executives viewed WorldCom as their personal
piggy bank, and that practice must be stopped. While these recent actions
hopefully shut the barn door, a lot of questionable bonuses and payments were
made earlier by WorldCom. For example, Bernard J. Ebbers, the chief executive of
WorldCom, got a $10 million bonus, as did Scott Sullivan, the chief financial
Sen. Grassley also asked for "the dollar figure, name and title of every
employee, director or officer of WorldCom who received a bonus (in any form)
with a value of greater than $100,000 (at the time it was awarded) for any year
since January 1, 1999."
He asked for the same information from WorldCom. He also asked Sidgmore to
inform him of "what actions that WorldCom has taken, or is considering
taking, to have bonuses returned (or to not provide a bonus) to the company to
improve its financial situation."
WorldCom: Representatives Write FCC Re Continuity During
7/2. Rep. Ed Markey (D-MA) sent a letter [PDF]
to Federal Communications Commission (FCC)
Chairman Michael Powell
regarding a possible WorldCom bankruptcy.
Rep. Markey, who is the ranking Democrat on the House Telecom Subcommittee,
wrote that "I am concerned that any decision by WorldCom management to seek
bankruptcy protection could prove disruptive to essential communications as well
as economic activity in our country."
He also stated that "I believe it wise, however, for the Commission to
prepare adequately for such an event in order to minimize any harm to the public
and to ensure that telecommunications services continue if bankruptcy does
Rep. Markey continued. "While the Commission chose not to intervene
directly to ensure continuity of service when Excite@Home and Northpoint
Communications went bankrupt last year and cut-off Internet access for ten of
thousands of Americans, I hope you agree that the hazards posed to the public if
WorldCom were to go bankrupt go to the core of the Commission's
responsibilities. In addition to the millions of Americans who subscribe to
WorldCom for traditional telephone service, WorldCom is also responsible for
carrying a vast portion of the nation's email traffic. In fact, some analysts
calculate WorldCom's email traffic carriage to be as high as 70 percent of those
emails that travel within that Unites States and 50 percent of all such traffic
Rep. Markey cited 47
U.S.C. § 214(a), which provides, in part, that "No carrier shall
discontinue, reduce, or impair service to a community, or part of a community,
unless and until there shall first have been obtained from the Commission a
certificate that neither the present nor future public convenience and necessity
will be adversely affected thereby."
Rep. Billy Tauzin (R-LA) and Rep. Fred Upton (R-MI) also wrote to
Chairman Powell. They wrote that "In the wake of recent revelations
regarding WorldCom's accounting improprieties and given the distinct possibility
that WorldCom may soon file for bankruptcy, we urge that all necessary steps
should be taken to ensure that our nation's telecommunications infrastructure
and consumers are protected from disruptions in service and degradation of
service quality which could result from such an occurrence."
They also stated that "WorldCom owns MCI, the nation's second largest long
distance carrier, and it is the world's largest Internet backbone provider,
carrying approximately 50% of the Internet's total traffic and 70% of e-mail in
the United States."
However, unlike Rep. Markey, they did not assert that Section 214 covers
Internet backbone or e-mail service, or that regulating Internet services is a
"core" responsibility of the FCC.
DC Circuit Rules on Waiver of Attorney Client Privilege in FTC
7/2. The U.S.
Court of Appeals (DCCir) issued its opinion
v. Glaxo Smith Kline, a case regarding the scope of the attorney
client privilege in a drug patent related proceeding. The District Court held
that the privilege was waived because GSK had distributed the documents subject
to the claim of privilege to various attorneys, consultants and third parties,
and thus, not kept the documents confidential. The Appeals Court reversed.
Background. Glaxo Smith Kline (GSK)
makes paroxteine hydrochloride hemihydrate, a drug used in the treatment of
depression and panic disorder. It markets this drug under the brand name Paxil. Other companies applied to the Food and Drug Administration (FDA) for permission
to sell generic versions of Paxil when GSK's patents expire.
FTC Proceeding. The Federal Trade
Commission (FTC) commenced an investigation into whether GSK, in an attempt
to prevent or delay competition from generic versions of Paxil, abused the
process for listing its patents in the FDA's compilation of "Approved Drug
Products with Therapeutic Evaluations." The FTC issued a subpoena
requesting documents from GSK, including documents that it had been ordered to
disclose in a previous patent infringement lawsuit against generic
manufacturers, and documents related to the manufacturing and marketing of Paxil,
the listing and use of any patents regarding Paxil, and any filings with the FDA
regarding Paxil. GSK did not produce all requested documents.
District Court. The FTC filed a complaint in U.S. District
Court (DC) to enforce its subpoena. The dispute was reduced to whether GSK
must produce 91 documents. GSK raised both the attorney client privilege and
work product privilege. The FTC argued that GSK had forfeited its claim to
confidentiality by disseminating the documents widely both within GSK and to
consultants and other third parties. The FTC also belatedly argued that the
documents lacked confidential content. The District Court ordered GSK to produce
the 91 documents. It reasoned that GSK had failed to meet its burden with
respect to two requisite elements of the attorney client privilege: that the
documents were kept confidential, and that the documents contained confidential
information. It wrote that GSK had "not sustained its burden of
demonstrating that the relevant documents were distributed on a 'need to know'
basis or to employees that were 'authorized to speak or act' for GSK". It
also rejected the work product argument. GSK appealed.
Court of Appeals. The Court of Appeals reversed. It wrote that the
District Court had placed an overreaching burden on GSK. It wrote that "The
Company's burden is to show that it limited its dissemination of the documents
in keeping with their asserted confidentiality, not to justify each
determination that a particular employee should have access to the information
therein. Not only would that task be Herculean -- especially when the sender and
the recipient are no longer with the Company -- but it is wholly unnecessary.
After all, when a corporation provides a confidential document to certain
specified employees or contractors with the admonition not to disseminate
further its contents and the contents of the documents are related generally to
the employees' corporate duties, absent evidence to the contrary we may
reasonably infer that the information was deemed necessary for the employees' or
The Appeals Court also reversed the District Court's determination regarding
lack of confidential content, but on procedural grounds. (The FTC did not raise
this argument until its reply brief for the District Court, thereby depriving
GSK an opportunity to respond.) The Appeals Court did not address the work
product privilege issue, because it reversed on other grounds.
People and Appointments
7/2. President Bush announced his intent to nominate Daniel Pearson to be
a Commissioner of the U.S. International Trade
Commission for a nine year term expiring June 16, 2011. Pearson has worked
for Cargill since 1987. Before that he
worked for former Sen. Rudy Boschwitz (R-MN). See, White House
7/2. Ira Keltz has been named Deputy Chief of the Federal Communications Commission's (FCC) Office of Engineering and Technology's (OET)
Policy and Rules Division (PRD). The PRD writes rules pertaining to the
allocation of electromagnetic spectrum and technical issues pertaining to radio
equipment and electronic devices. It also handles the coordination of spectrum
issues with other agencies of the federal government. Keltz, an electrical
engineer, has worked for the FCC since 1994. Before that, he worked for Loral. See, FCC
7/2. The U.S. District Court (DC)
issued a memorandum opinion
[36 pages in PDF] in USA v. Microsoft regarding compliance with the Tunney Act.
FCC Seeks Comments on Strategic Plan
7/1. The Federal Communications Commission
(FCC) announced that "the public is welcome to review and comment on a
draft of its revised strategic plan for 2003-2008." See, FCC
The draft strategic
plan [19 pages in PDF], which is prepared pursuant to the Government
Performance and Results Act (GPRA), states that the FCC has core goals in six
areas: broadband, spectrum, media, homeland security, competition and
modernizing the FCC.
The plan states that the FCC's goal regarding broadband is to "Establish
regulatory policies that promote competition, innovation, and investment in
broadband services and facilities while monitoring progress toward the
deployment of broadband services in the United States and abroad." The plan
further states that it is an FCC goal to "Harmonize regulation of competing
broadband services that are provided via different technologies and network
The plan states that the FCC's goal regarding broadband spectrum management is
to "Encourage the highest and best use of spectrum domestically and
internationally in order to encourage the growth and rapid adoption of new
technologies." The plan also states that it is a goal to "Develop and
implement market oriented allocation and assignment policies, where consistent
The plan states that the FCC's goal regarding media is to "Revise media
regulations so that timely development and delivery of new technologies is
encouraged, media ownership rules promote competition and diversity in a
comprehensive, legally sustainable manner, and the migration to digital modes of
delivery is facilitated."
The plan states that the FCC's goal regarding homeland security is to
"Provide leadership in evaluating and strengthening the Nation's
communications infrastructure, in ensuring rapid restoration of that
infrastructure in the event of disruption, and in ensuring that essential public
health and safety personnel have effective communications services available to
them in emergency situations."
The plan states that the FCC's goal regarding competition is to "Support
the Nation's economy by ensuring there is a comprehensive and competitive
framework within which the communications revolution can continue so that all
consumers can make meaningful choices among and have equal access to
The plan states that the FCC's goal regarding modernization is to
"Emphasize performance and results through excellent management, develop
and retain independent mission critical expertise, and align the FCC with
dynamic and converging communications markets."
FCC Receives Comments on Broadband Internet Access
7/1. Monday, July 1, was the extended deadline to submit reply comments to the FCC in
response to its Notice of Proposed Rulemaking (NPRM) titled "In the Matter
of Appropriate Framework for Broadband Access to the Internet over Wireline
BellSouth submitted a comment
[65 pages in PDF] in which it argued that the FCC "should (1) adopt its
tentative conclusion in the Notice that broadband Internet access service
is an information service with the transmission offered via telecommunications
and not a telecommunications service; (2) find that to the extent an ILEC offers
a stand alone transmission service for broadband services that it does so as
private carriage and not common carriage; and (3) eliminate the Computer
Inquiry requirements from BOCs for their provision of broadband information
services." It added the the FCC "must act in the UNE Triennial
Review to eliminate existing unbundled network elements related to
Similarly, SBC submitted a comment
[71 pages in PDF]. It wrote that "Contrary to the apocalyptic proclamations
of some commenters, the deregulatory initiatives that the Commission is
considering in this proceeding are neither extreme nor revolutionary.
Classification of wireline broadband Internet access services as information
services does not represent a departure from the Commission's prior
conclusions." See also, SBC release.
In contrast, the Information Technology
Association of America (ITAA) submitted a comment
[PDF] in which it argued that the FCC "should decline the Bell Operating
Companies' invitation to completely dismantle the pro-competitive regulatory
regime governing their participation in the broadband telecommunications and
information services markets."
The ITAA continued that "The foundation of the BOC's proposals to eliminate
the Commission's existing regulatory regime is thier assertion that -- given the
growth of cable and other broadband transmission ``platforms´´ ILECs no longer
have either the incentive or the ability to discriminate in the provision of
broadband telecommunications services to non-affiliated ISPs. This simply is not
The ITAA elaborated that "While some retail customers may have their choice
of broadband Internet access providers, ISPs remain critically dependent on the
ILECs for wholesale broadband telecommunications service necessary to serve
their subscribers. Cable systems are not yeat a viable alternative source of
local broadband transmissiono service for most ISPs.
The ITAA also argued that the FCC cannot permit the ILECs to offer stand alone
broadband telecommunications services on a private carrier basis. The ITAA
further argued that the FCC cannot eliminate unbundling obligations imposed upon
Sprint submitted a comment
[PDF] in which it asserted that the FCC "has for the first time ...
instituted a rulemaking proceeding in which the ultimate issue is whether to
eliminate Title II regulation of bottleneck "last-mile" common carrier
facilities." This, wrote Sprint, is "contrary to fact, law and the
Sprint stated that it has "no quarrel with the Commission's tentative
conclusion that the provision of wireline broadband Internet access service is
an information service." However, it argued that ILECs "must unbundle
their basic common carrier wireline broadband transmission facilities from their
information services and offer the transmission capacity on a standalone basis
to other information service providers ..."
Time Warner Telecom Corporation
submitted a comment
[PDF] in which it stated that "There is little question that broadband
Internet access provided by ILECs is currently classified as an information
service with a telecommunications service transmission component and that there
is no basis for pursuing further the wholesale reclassification of broadband
transmission as ``telecommunications´´ or ``private carriage.´´ All
commenters, including the ILECs, agree that the regulatory treatment of
broadband should be determined based on a market power analysis. That analysis
must be performed in the Non-Dominanceand Triennial Review proceedings.
The Commission should conclude in those proceedings that ILECs continue to
exercise market power in the provision of broadband transmission for all
relevant product markets, but most especially for the high capacity end user
circuits needed to provide frame relay, ATM, and similar services demanded by
medium sized and large businesses. Given this market power, reclassification of
broadband transport would give ILECs the opportunity to harm competition by
denying inputs needed by competitors."
The National Association of Broadcasters (NAB)
submitted a comment
[PDF] in which it stated that the "NAB emphasizes that the Commission's
failure to adopt access and nondiscrimination requirements will inevitably
produce a broadband marketplace characterized by minimal competition, a lack of
innovation, and severely restricted consumer choice."
The NAB continued that however the FCC categorizes broadband Internet access
over wireline facilities, it must "insure that consumers have meaningful
choices among competing service and content providers in the broadband
environment." Specifically, the FCC "should therefore retain the
access and nondiscrimination policies that have been consistently applied in the
narrowband Internet marketplace, and continue to apply them to high speed
Internet access services provided over wireline facilities."
The Alliance of Local Organizations Against Preemption (ALOAP) submitted a comment
[PDF] in which it argued that the FCC "should leave to Congress the major
questions of how to classify wireline broadband internet access for purposes of
Communications Act oversight."
The State of New York submitted a comment
[PDF] in which it argued that the FCC "recognized long ago that the
underlying transmission facilities used to carry and connect so-called enhanced
services or information services, when bundled by the incumbent local exchange
carrier (``ILEC´´), must be offered by their monopoly owners on an unbundled
and nondiscriminatory basis, as common carriage under Title II of the
Communications Act." New York continued that "This NPRM threatens
to unravel the FCC's longstanding policy success, and to do so at the very
moment when unbundled nondiscriminatory access to monopoly owned transmission
facilities is necessary to the continued growth and availability of high speed
Internet services using wireline facilities.
Universal Service Subsidies. The American
Library Association (ALA) submitted a comment
in which it argued that the FCC should include "broadband providers among
the entities that support universal service". The FCC's e-rate program
subsidizes both schools and libraries, under the rubric of universal service.
The ALA wrote that "In order to effectively fulfill their educational
roles, libraries need to offer their patrons broadband Internet access."
The National Cable and Telecommunications
Association (NCTA) submitted a comment on the issue of contributions to the
Universal Service Fund (USF). It wrote that "Before the Commission extends
the universal service contribution requirement to all providers of facilities
based broadband Internet access services, it must first determine whether such
an extension is in the public interest. In doing so, the Commission should
evaluate the current size of the USF, all potential contributors to the USF, the
effect that requiring USF contributions from all facilities based broadband
Internet access services would have on the Commmission's goal of promoting
broadband deployment, whether potential contributors offer public switched
service or the functional equivalent, and the special circumstances facing
providers of cable modem services."
The ITAA also commented on universal service subsidies. It wrote that the FCC
cannot require ISPs to make payments to the USF.
This is CC Docket No. 02-33. See, May 29 notice
[PDF] extending deadline from June 3 to July 1. See also, Order
[PDF] extending deadline from May 14 to June 3, and original
notice in Federal Register, February 28, 2002, Vol. 67, No. 40, at Pages
9232 - 9242.
IIPA Comments on Copyright and Andean Trade
7/1. The International Intellectual Property
Alliance (IIPA) submitted comments [PDF] to the U.S. International Trade Commission (ITC)
regarding copyright issues associated with the Andean Trade Preferences Act (ATPA).
The IIPA wrote that the "ATPA is not solely an anti-narcotics
The ITC, among other things, makes determinations in investigations involving
unfair practices in import trade involving allegations of infringement of U.S.
patents and trademarks by imported goods. The ITC may order the exclusion of the
imported product from the United States. The ITC requested comments to assist it
in the preparation of its 2001 annual ATPA report to Congress.
The IIPA commented that "Inadequate and ineffective copyright enforcement
continues to inflict significant trade distortions in the Andean region. High
levels of piracy of music, audiocassettes and compact discs, business,
entertainment and multimedia software on all platforms, films, television
programs, videocassettes, textbooks, tradebooks, reference and professional
publications and journals, all hurt U.S. creators."
It continued that "Business software piracy appears in various formats,
including counterfeiting, resellers, mail order houses, bulletin boards, other
internet based distributions and end user piracy. The greatest threat comes from
end user piracy ..."
The IIPA also wrote that "as the forms of piracy shift from hard goods and
more toward digital media, the challenges faced by the copyright industries and
national governments to enforce copyright laws grow exponentially.
Fundamentally, the Internet transforms copyright piracy from a mostly local
phenomenon to a global plague. It makes it cheaper and easier than ever for
thieves to distribute unauthorized copies of copyrighted materials around the
globe. Modern copyright laws must respond to this fundamental change by
providing that creators have the basic property right to control distribution of
copies of their creations. Copyright owners must be able to control delivery of
their works, regardless of the specific technological means employed. Criminal
and civil justice systems must work in a transparent and expeditious manner and
result in deterrent penalties and remedies."
Incoming EU Competition DG Addresses Antitrust
7/1. Philip Lowe, who will take office as the EU Competition Director General on
September 1, gave a speech
to the American Antitrust Institute
in Washington DC. He discussed the principles underlying EU competition policy,
aids provided by national governments, different standards employed by the EU
and the US in merger reviews, efficiencies, economic analysis, and other topics.
USTR Proposes Reducing Barriers to Trade in Services
7/1. The Office of the U.S. Trade Representative
(USTR) announced that it has proposed liberalizing global trade in services,
including information technology, telecommunications, financial, and legal
services. The proposal is made in the World Trade
Organization (WTO) negotiating round recently launched at a meeting in Doha.
See, USTR release.
IT Services. The USTR published a summary
of its proposal, but not the proposal, in its web site. The summary states that
"The United States is requesting increased access for data processing
services, software and hardware related services, and other computer related
Communications Services. The USTR summary also states that the U.S.
"is requesting increased access for telecommunications services, including
basic and value added services. In addition, the United States requests that WTO
members adopt commitments in the WTO Basic Telecommunications Reference Paper,
which sets out a number of key pro-competitive regulatory obligations. In
addition, the United States may urge members who have not fully privatized their
incumbent telecommunications carrier to do so in the near future. The United
States also is requesting commitments in cable network services, defined as
owning or leasing cable facilities for the distribution of video programming
Legal Services. The USTR summary also states that "With the
acceleration of world economic integration, law firms have become increasingly
important in advising clients on a variety of business matters, including
mergers and acquisitions with foreign companies and business contracts involving
multiple jurisdictions. ... The United States is requesting increased access to
make it easier for these professionals to serve clients internationally as
foreign legal consultants or fully licensed legal professionals (for example,
remove citizenship requirements for licensing and remove restrictions on foreign
ownership, form of organization and association with local professionals)."
Transparency. The USTR summary also proposes "transparent regulatory
regimes", including establishing "clear, publicly available domestic
procedures for application for licenses or authorizations, and their renewal or
extension" and "domestic procedures providing for a standard formal
process of informing the public of regulations, or changes to existing
regulations, prior to their final consideration by the relevant authority and
entry into effect. Procedures should also provide meaningful opportunities for
comments and questions by interested parties."
The Information Technology Association of America
(ITAA) praised the proposal. ITAA President Harris Miller stated in a release
that "Services are a major contributor to the global $2.4 trillion
information and communications technology marketplace ... We are gratified that
the U.S. Trade Representative has included services sectors critical to both the
delivery and the consumption of information technology products and services in
The Competitive Telecommunications Association
(CompTel) also praised the USTR's proposal. It stated in a release that "CompTel's
members are harmed by the trade barriers maintained by our trading partners.
This round of trade talks is especially important to the U.S. economy in light
of the difficult market conditions currently faced by telecommunications
providers in the U.S. CompTel hopes that international recognition of problems
exacerbated by closed telecommunications markets will spur negotiators and
regulators in the WTO member countries to expand or live up to their market
opening obligations and create an environment where competition can
GAO Reports on IT in Executive Office of the President
7/1. The General Accounting Office (GAO)
released a report [PDF]
dated June 28 regarding the use of information technology by the Executive
Office of the President (EOP).
The GAO found that "the office is in the process of developing an
officewide blueprint for modernizing its operations and supporting technology,
commonly referred to as an enterprise architecture. Thus far, it has developed
parts of the architecture, most notably the rules and definitions governing the
technical characteristics of IT investments and explaining EOP-wide technical
service categories (e.g., network services, security services, etc.). Moreover,
the steps it has taken to complete the architecture are consistent with
recognized best practices."
It further found that the "EOP has taken steps toward defining an
officewide IT capital planning and investment control process that is to be used
to implement the enterprise architecture".
The report was prepared for Sen. Byron
Dorgan (D-ND), Sen. Ben Campbell
(R-CO), Rep. Ernest Istook (R-OK),
and Rep. Steny Hoyer (D-MD), the
Chairmen and ranking members of the Senate and House appropriations
subcommittees that handle appropriations for the EOP.
8th Circuit Rules in PSLRA Pleading Standards Case
7/1. The U.S. Court of Appeals
(8thCir) issued its opinion [PDF] in
Re Navarre Securities Litigation, a class action securities case
involving the pleading standards of the PSLRA.
Navarre Corporation provides distribution
and related services to developers and retailers of home entertainment content,
including PC software, audio and video titles, and interactive games. Plaintiffs
filed a complaint in U.S. District Court
(DMinn) against Navarre and certain of its officers and directors alleging
violation of Sections 10b and 20 of the Securities Exchange Act of 1934. The
District Court held that the plaintiffs' complaint failed to satisfy the
heightened pleading requirements of the Private Securities Litigation Reform Act
of 1995 (PSLRA), 15 U.S.C. § 78u-4(b)(1)-(2).
The Court of Appeals affirmed. The Court followed the reasoning of the First
Circuit stated in Greebel
v. FTP Software, 194 F.3d 185 (1999).
People and Appointments
7/1. Rep. J.C. Watts (R-OK)
announced that he will not run for re-election. See also, statement
by President Bush.
7/1. Federal Communications Commission (FCC)
Chairman Michael Powell
commenced his second term as FCC Commissioner for a term expiring June 30, 2007.
7/1. Scott Ford became the President and Chief Executive Officer of Alltel. See, release.
7/1. The Information Technology Association of
America (ITAA) stated that it wrote a letter to Tom Ridge, Director
of the Office of Homeland Security, urging the creation of separate physical and
cyber security reporting structures in the new Department of Homeland Security.
7/1. The Washington Utilities and
Transportation Commission (WUTC) recommended that Qwest's Section 271
application to provide in region interLATA services in the state of Washington
be approved. See, WUTC
release and Qwest
Go to News from June 26-30, 2002.