TLJ News from July 1-5, 2005

People and Appointments

7/5. Kenneth Davidson left the Federal Trade Commission's (FTC) Bureau of Competition (BOC). He joined the American Antitrust Institute (AAI) as a Senior Fellow. Davidson also wrote a essay on his twenty-seven years at the BOC.

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7/5. The World Trade Organization (WTO) released a statement [1 page in PDF] in the Antigua and Barbuda internet gambling proceeding. It states that "On 30 June 2005, pursuant to the request received on 20 June 2005 from Antigua and Barbuda, the Director-General appointed Dr. Claus-Dieter Ehlermann to act as arbitrator under Article 21.3(c) of the Understanding on Rules and Procedures Governing the Settlement of Disputes in the matter United States -– Measures Affecting the Cross-Border Supply of Gambling and Betting Services." See also, story titled "WTO Appellate Body Upholds U.S. Laws Affecting Internet Gambling" in TLJ Daily E-Mail Alert No. 1,111, April 8, 2005; story titled "Allgeier Addresses Trade Agreements and Internet Gambling" in TLJ Daily E-Mail Alert No. 1,118, April 19, 2005; and story titled "WTO Panel Instructs Congress to Amend Wire Act to Legalize Internet Gambling" in TLJ Daily E-Mail Alert 1,016, November 11, 2004.

Broadcom Files Antitrust Complaint Against Qualcomm

7/1. Broadcom filed a complaint [48 pages in PDF] in U.S. District Court (DNJ) against Qualcomm alleging violation of federal antitrust laws in connection with WCDMA technology and the UMTS standard.

The complaint states that it pertains to "the illegal and anticompetitive conduct of defendant Qualcomm in the markets for technology and chipsets that operate cell phones employing Wideband Code Division Multiple Access ("WCDMA"), a third generation ("3G") technology that is implemented through a mobile telephone standard known as Universal Mobile Telephone System ("UMTS")."

Broadcom also makes UMTS chipsets. See also, Broadcom release.

The complaint alleges that "Qualcomm holds certain patents that it has asserted are "essential" to WCDMA technology and the UMTS standard. Thus, international and United States standard-setting bodies only adopted UMTS as a mobile telephone standard after Qualcomm represented in writing that it would license its WCDMA patents on fair, reasonable and non-discriminatory (that is, so-called "FRAND") terms. The adoption of the UMTS standard led mobile telephone services carriers to invest billions of dollars in developing UMTS phone systems."

The complaint further alleges that "after the UMTS standard was adopted, giving Qualcomm monopoly power in the WCDMA technology markets, Qualcomm disregarded its FRAND commitments. Qualcomm has instead leveraged its WCDMA patents in an attempt to expand its monopoly power into the separate market for the sale of the UMTS chipsets that provide basic operational functionality for UMTS phones. Indeed, Qualcomm is now employing with respect to WCDMA and UMTS the same types of unlawful and anticompetitive tactics that Qualcomm has already used to gain tight monopoly control of the markets for technology and chipsets applicable to another third-generation mobile phone standard based on Code Division Multiple Access ("CDMA") technology."

The complaint alleges monopolization in violation of Section 2 of the Sherman Act, which is codified at 15 U.S.C. § 2, attempted monopolization in violation of Section 2, unfair exclusive dealings and other exclusionary agreements in violation of Section 1 of the Sherman Act, 15 U.S.C. § 1, unlawful tying in violation of Section 1, exclusive dealing in violation of Section 3 of the Clayton Act, 15 U.S.C. § 14, unlawful tying in violation of Section 3 of the Clayton Act, and maintenance of monopoly in violation of Section 2 of the Sherman Act.

This shotgun complaint also alleges numerous violations of the state law of New Jersey, including violation of New Jersey Antitrust Act, tortious interference with prospective economic advantage, breach of contract, promissory estoppel, and fraud.

Qualcomm stated in a release that the complaint is "meritless". It stated that "Broadcom's accusation that QUALCOMM has not lived up to its commitments to standard setting organizations to license its essential patents on fair and reasonable terms is belied by the more than 130 licenses that QUALCOMM has granted to a broad range of companies. These licenses-including agreements with the world's largest and most sophisticated manufacturers of wireless telecommunications equipment-make QUALCOMM's patents the most extensively licensed portfolio in the cellular industry."

Qualcomm further stated that Broadcom frequently files lawsuits that fail. It added that it "believes that the patent infringement claims filed in May of this year by Broadcom in federal court and in the ITC are without merit and that QUALCOMM looks forward to proving that it has not infringed any of the asserted patents."

This case is Broadcom Corporation v. Qualcomm, Inc., U.S. District Court for the District of New Jersey. Broadcom is represented by the law firm of Boies Schiller & Flexner.

Libertelli Joins Skype

Christopher Libertelli7/1. Christopher Libertelli (at right) joined Skype as "Director, Government & Regulatory Affairs, North America". He was previously Senior Legal Advisor to former Federal Communications Commission (FCC) Chairman Michael Powell.

Before joining Powell's staff, he worked in the FCC's Common Carrier Bureau (Wireline Competition Bureau). Before that, he worked for the law firm of Dow Lohnes & Albertson.

Skype stated in a release that "Libertelli will represent Skype before North American government bodies and oversee initiatives to drive public policies that will grow and protect the use of innovative technologies. The Skype policy team will serve as advisors to government leaders and share technical and policy expertise." Skype makes voice over internet protocol (VOIP) software.

Justice O'Connor Resigns

7/1. Supreme Court Justice Sandra O'Connor announced her resignation. President Bush has not yet nominated a replacement.

Bush stated that "Under the Constitution, I am responsible for nominating a successor to Justice O'Connor. I take this responsibility seriously. I will be deliberate and thorough in this process. I have directed my staff, in cooperation with the Department of Justice, to compile information and recommend for my review potential nominees who meet a high standard of legal ability, judgment and integrity and who will faithfully interpret the Constitution and laws of our country." He added that "As well, I will continue to consult, as will my advisors, with members of the United States Senate. The nation deserves, and I will select, a Supreme Court Justice that Americans can be proud of. The nation also deserves a dignified process of confirmation in the United States Senate, characterized by fair treatment, a fair hearing and a fair vote. I will choose a nominee in a timely manner so that the hearing and the vote can be completed before the new Supreme Court term begins." See, transcript. See also, statement by Attorney General Alberto Gonzales.

Sen. Patrick Leahy (D-VT), the ranking Democrat on the Senate Judiciary Committee, stated in a release that "I renew my call to the President to consult with Members of the Senate from both sides of the aisle as he makes his decision about a nominee."

Sen. Charles Grassley (R-IA) stated in a release that "I expect that any nominee the President sends to the Senate will be treated with fairness and respect, including an up or down vote in the Senate. As a senior member of the Judiciary Committee, I'll be looking forward to hearing from a nominee who understands that the role of the courts is to interpret the law, not create the law." Sen. Orrin Hatch (R-UT) stated in a release that "The American people are tired of the confrontational partisanship that has characterized the judicial confirmation process in recent years. When President Bush nominates someone to replace Justice O’Connor, the Senate must fulfill its constitutional responsibility to treat the nominee fairly with a full debate on the merits and then an up-or-down vote."

See also, release of Alliance for Justice and release of People for the American Way, two Washington DC based interest groups that have frequently lobby against confirmation of judicial nominees of Republican Presidents.

More People and Appointments

7/1. Mark Feidler was named President and Chief Operating Officer of BellSouth, and was elected to the Board of Directors of BellSouth, effective July 1, 2005. He was the COO. He will report to Duane Ackerman, BellSouth's Ch/CEO.

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7/1. The U.S. Patent and Trademark Office (USPTO) announced that it has completed its move to its new headquarters. See, USPTO release.

7/1. The Copyright Office published a notice in the Federal Register that states that it is "removing its regulations governing the filing of claims to cable, satellite, and DART royalty funds. These claims now are to be filed with the Copyright Royalty Judges pursuant to the Copyright Royalty and Distribution Reform Act of 2004, which became effective on May 31, 2005." See, Federal Register, July 1, 2005, Vol. 70, No. 126, at Pages 38022 - 38023.

7/1. Microsoft announced that it has settled an antitrust action brought by IBM. Microsoft wrote in a release that "Microsoft Corp. and IBM today announced that they have entered into an agreement to resolve antitrust issues between the two companies. Today's settlement resolves claims arising from the United States v. Microsoft antitrust case in the mid-1990s, where IBM was identified in U.S. District Judge Thomas Penfield Jackson's findings of fact as having been impacted in its business by certain Microsoft practices. Under the agreement, Microsoft will pay IBM $775 million and extend $75 million in credit towards deployment of Microsoft software at IBM."

Go to News from June 26-30, 2005.