News from July 1-5, 2002

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 Communications.
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 companies.
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 release.
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.
More News
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 release.
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 2000."
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 Communications.
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 Bonuses
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 officer."
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 Bankruptcy
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 occur."
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 worldwide."
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 v. GSK
7/2. The U.S. Court of Appeals (DCCir) issued its opinion in FTC 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 contractors' work."
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 release.
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 release [PDF].
More News
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 notice [PDF].
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 architectures."
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 with law."
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 communications services."
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 Facilities".
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 broadband."
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 true."
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 ILECs.
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 public interest".
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 program."
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 services."
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 services."
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 these deliberations."
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 succeed."
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 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.
More News
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. See, ITAA release.
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 release.

Go to News from June 26-30, 2002.