TLJ News from November 21-25, 2005

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11/24. Viviane Reding, the EU Commissioner for Information Society and Media, gave a speech in Manchester, United Kingdom, on electronic government in Europe.

Mandelson Discusses Status of WTO Trade Negotiations

11/23. Peter Mandelson, the EU Trade Commissioner, spoke to the European Parliament's Trade Committee in Brussels, Belgium, on November 23, 2005. He addressed the failure to make progress before the December ministerial meeting in Hong Kong. He also discussed pharmaceutical IPR. See, transcipt.

Peter MandelsonMandelson (at left) stated that "We are far from where we should be in the process. We have for too long exchanged statements of political positions instead of entering into real negotiation. For too long we have had too little to negotiate about, having existed in an agricultural silo and only recently started to look beyond this. As a result we have not had time to discover potential trade-offs and to narrow our differences so as to pin down the possible deals."

He added that "lowering expectations for HK does not mean lowering ambition for the round as such. Lowering expectations for HK means that the key decisions will have to come some time early next year, so that the Round can end as scheduled at the end of 2006 or early 2007."

He also offered a four part proposal. "First, all industrialised WTO members should commit to provide duty and quota-free access to all products from all LDCs".

"Second, we should adopt a package on special and differential treatment proposals to reconfirm the flexibilities for LDCs that already exist in the WTO".

"Third, it is crucial that we enshrine in the WTO’s intellectual property agreements the conditions for a better access to cheap drugs against pandemics".

"Fourth, we should agree on a strong Aid for Trade package along the lines of what was agreed at the Gleneagles G8 Summit. This is key to help strengthen the capacity of developing countries to trade. The Commission has set an example with the €1bn per year pledge made by President Barroso at the G8 Summit."

He concluded that "The WTO will produce a draft text within days that will make clear what we may agree in HK and what should be left for later."

The WTO released this draft on November 26. See story above titled "WTO Releases Draft Hong Kong Ministerial Text".

EU Commissioner Advocates EU Wide Copyright and Censorship Regimes

11/23. Viviane Reding, the EU Commissioner for Information Society and Media, gave a speech [6 pages in PDF] in Montpellier, France titled "Why Broadband Needs Content".

She said that "If we want growth and jobs, if we want better lives for citizens and if we want to retain Europe's position at the front of the global telecommunications industry then we have to clear away the barriers to the development of new, high-value, content-rich and interactive services."

She identified several such regulatory barriers. She advocated single European copyright regime. She advocated a single European content censorship regime that would apply to broadcast television, and all other audiovisual content services. She also spoke in vague terms about digital rights management (DRM).

See, full story.

People and Appointments

11/23. The Internet Corporation for Assigned Names and Numbers (ICANN) announced several news hirings: Bernadette Failla (Executive Assistant to the General Manager Global Partnerships and the Head of HR), Nicole Bihari (Executive Assistant to ICANN General Counsel), Sarah Trehern (IANA Project Assistant), Peter Sanchez (Network Engineer), and Michael Zupke (Registrar Liaison Manager). See, ICANN release.

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11/23. The Government Accountability Office (GAO) released a report [72 pages in PDF] titled "DOD Business Systems Modernization: Important Progress Made in Establishing Foundational Architecture Products and Investment Management Practices, but Much Work Remains".

Portman Discusses Status of WTO Trade Negotiations

11/22. Robert Portman and Peter Allgeier held a news conference in Geneva, Switzerland, at which they discussed the progress of talks leading up to the World Trade Organization's (WTO) Sixth WTO Ministerial Conference in Hong Kong, PR China, on December 13-18, 2005. See, transcript.

Portman said that "We intend to use our remaining time between now and Hong Kong as productively as possible. We want Hong Kong to be more than just a simple stock-taking exercise. Stock-taking is important and there is an educational process that needs to go on and I think that is an important aspect of Hong Kong, but we would like to go further. We'd like to be sure that Hong Kong provides the necessary guidance for our negotiators to complete the work in 2006. Hong Kong is, in my view, a very important gathering. It does create the road map for negotiations in 2006 and we want to be sure there is as much specificity as possible to achieve the ambitious results that we've talked about in this room before."

Portman was also asked "what discussions took place in regards to the post-Hong Kong agenda"? He responded that "I believe we ought to have another meeting. Without a meeting, without setting up sort of a backstop, it's tough to make progress. We've got to make sure that coming out of Hong Kong we don't simply all breathe a sigh of relief and go back home and start working on other very important issues and leave Doha behind. We need to keep the pressure on."

Much of the negotiating has focused on agriculture. However, Portman did reference telecommunications and information technology in passing at this news conference.

Portman was asked, "Can you highlight whether the U.S. is keen to join some of the sectorials the Chairman has highlighted in his Chairman's text today?" He responded that "... the sectoral approaches are also very important. Why? Because they almost leapfrog the normal negotiating process and provide for, among a critical mass of countries who are interested, immediate zeroing of tariffs. We've seen this before, by the way in telecommunications, and to a certain extent with information technology. So this is a good model."

Senate Commerce Committee to Hold Public Hearings

11/22. The Senate Commerce Committee (SCC) announced that it will hold a series 14 hearings on internet, telecommunications, spectrum and broadcasting issues over a two month period early in the Second Session of the 109th Congress.

Day Date Time Topic
Thurs. Jan. 19 10 AM Decency
Thurs. Jan. 19 2:30 PM Internet Pornography
Tues. Jan. 24 10 AM Video Franchising
Tues. Jan. 24 2:30 PM Video Content
Thurs. Jan. 26 10 AM Competition &
Tues. Jan. 31 10 AM Broadcast &
Audio Flag
Tues. Feb. 7 10 AM Net Neutrality
Tues. Feb. 14 10 AM State and Local Issues
& Municipal Networks
Tues. Feb. 28 10 AM USF Contributions
Tues. Feb. 28 2:30 PM USF Distribution
Thurs. Mar. 2 10 AM Wireless Issues &
Spectrum Reform
Tues. Mar. 7 10 AM Rural Telecom
Tues. Mar. 14 10 AM VOIP
Tues. Mar. 14 2:30 PM Wall Street Perspective
on Telecommunications

This marks a change in SCC procedure from the First Session of the 109th Congress. The incoming Chairman, Ted Stevens (R-AK), announced in January of 2005 that the SCC would handle most telecommunications, spectrum, internet and broadcast issues at the full Committee level, and that it would hold few public hearings or meeting. Instead, he conducted secret and closed hearings. He called closed meetings "listening sessions". He explained in several speeches that this would facilitate the quick enactment of legislation. Although, little has been enacted into law.

The SCC will continue to handle these issues at the full Committee level. However, it will hold the sort of public and open hearings that it evaded in 2005.

USPTO Releases Annual Report

11/22. The U.S. Patent and Trademark Office (USPTO) released a report [156 pages in PDF] titled "Performance and Accountability Report for Fiscal Year 2005".

This report is mostly devoted to an analysis of the finances, management, and patent and trademark operations of the USPTO.

Jon DudasIn addition, Jon Dudas (at right), the Director of the USPTO, and the Under Secretary of Commerce for Intellectual Property, wrote in this report that "The tremendous ingenuity of American inventors, coupled with an intellectual property system that encourages and rewards innovation, has propelled our nation from a small agrarian society to the world’s preeminent technological and economic superpower. And all of our patented technology finds its way to the public domain within 20 years -- freely available to any and all. The success of a strong system of intellectual property rights is not limited to the United States -- it has become the basis for economic development in nations throughout the world."

"Unfortunately," wrote Dudas, "a growing chorus of critics now questions whether this fundamental system of patents, trademarks, and copyrights enhances development in other nations. At the same time, there has been dramatic growth in the counterfeiting of products and pirating of digital content because of the advancement of digital technology, an increased focus by criminal organizations, and the lack of understanding by consumers that buying fake goods or illegally copying digital content is stealing and has victims."

See also, short USPTO release, which emphasizes that the USPTO "received a record number of patent and trademark applications" in fiscal year 2005.

SEC Seeks Contractor to Remake EDGAR

11/22. The Securities and Exchange Commission (SEC) published a set of documents titled "Draft Request for Proposal for New, Performance-based Contract for the Ongoing Support of the Electronic Data Gathering, Analysis, and Retrieval (EDGAR) Platform".

The SEC also issued a release. It states that "EDGAR has been the backbone of the SEC's disclosure program since the early 1980s. It receives approximately 700,000 filings each year from tens of thousands of corporate securities issuers, investment companies, and individuals. While EDGAR is regarded as one of the most valuable repositories of investment information in the United States, the information it contains isn't easily used by investors. Instead, the individuals and organizations that used EDGAR for over 375 million on-line searches in fiscal 2005 had to re-enter most of the data they found in order to analyze it."

It adds that the "last management contract for EDGAR was awarded in 1998. The draft RFP released today contemplates a significant, multi-year project to update the system's underlying technology. It will also cover ongoing management of the system."

The release also states that "The SEC has already begun to move toward the use of interactive data in its disclosure program. Since February 2005, the Commission has been testing the use of data tagging in periodic and investment company reports, using a format known as Extensible Business Reporting Language (XBRL). Filing financial data in XBRL is currently voluntary, and a number of registrants have begun to use the program."

SEC Chairman Chris Cox has been giving speeches recently on the subject of interactive data. See, November 7, 2005 speech in Tokyo, Japan, and November 11 speech in Boca Raton, Florida. See also, story titled "SEC Chairman Cox Discusses Use of Interactive Data in Corporate Reporting" in TLJ Daily E-Mail Alert No. 1,250, November 9, 2005.

The cover letter [PDF] states that this request for proposals (RFP) is "intended to establish a new, performance-based contract for the ongoing support of the EDGAR platform."

This letter states that the contract work will include "Conversion of an increasing amount of filed information to structured, interactive formats, building on the XML- and XBRL-based filing regimes already in place", "More robust use of metadata to describe specific characteristics of filings and registrants, and provide more effective searching and analysis", and "Restructuring of the data formats and transmission protocols used in disseminating filings to the public".

It also stated that "while today's EDGAR system is built on reasonably modern technology, it is in some ways based on processes and concepts that originated in a paper-based filing environment. Over the next few years, we anticipate developing a long-range strategy for more fully exploiting modern technology to make the filing process less burdensome, and the disclosed information more useful for both SEC staff and the investing public. This strategy will likely involve developing and implementing a new architectural vision for EDGAR, and substantially transforming it over time via a series of incremental upgrades and enhancements."

The draft RFP [154 pages in PDF] states that "A presolicitation conference will be held in Washington, DC on December 7, 2005." It also states that comments regarding improving the draft RFP are due by Monday, December 19, 2005.

New York Announces Settlement of Payola Investigation of Warner Music

11/22. The Office of the Attorney General of the State of New York announced in a release that "Warner Music Group Corp., the third largest record company in the United States, has agreed to abandon the industry-wide practice of providing radio stations and their employees with financial incentives and promotional items in exchange for ``airplay´´ for Warner's recordings." See also, document [57 pages in PDF] signed by Warner and New York titled "Assurance of Discontinuance".

Federal Communications Commission (FCC) Commissioner Jonathan Adelstein stated in a release [PDF] that "Attorney General Eliot Spitzer has once again achieved a breakthrough in the effort to combat payola and protect consumers from misleading broadcasts. The settlement with Warner Music Group adds more dirt to the mountain of evidence that payola is pervasive in the music business. This agreement once again raises serious concerns that not only has New York State law been violated, but Federal law under the FCC’s jurisdiction, as well. The FCC needs to act on this evidence and conclude as soon as possible the investigation we are now undertaking."

See also, stories titled "FCC Chairman Directs Enforcement Bureau to Conduct Payola Investigation" in TLJ Daily E-Mail Alert No. 1,191, August 9, 2005; "Adelstein Angles for More FCC Regulation of Speech" in TLJ Daily E-Mail Alert No. 1,143, May 26, 2005; and "Powell Announces FCC Investigation Regarding Armstrong Williams" in TLJ Daily E-Mail Alert No. 1,057, January 17, 2005.

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11/22. President Bush signed into law HR 2862, the "Science, State, Justice, Commerce, and Related Agencies Appropriations Act, 2006". This contains funding for the Federal Communications Commission (FCC), Federal Trade Commission (FTC), Securities and Exchange Commission (SEC), and National Science Foundation (NSF). It also contains funding for the Department of Commerce (DOC), and all of its components, including the U.S. Patent and Trademark Office (USPTO), National Institute of Standards and Technology (NIST), National Telecommunications and Information Administration (NTIA), and the Bureau of Industry and Security (BIS). It also contains funding for the Department of Justice (DOJ), and all of its components, including the Antitrust Division. See, White House release.

Texas Sues Sony BMG Alleging Violation of Texas Spyware Statute

11/21. The state of Texas file a complaint [8 pages in PDF] in state court in Texas against Sony BMG Music Entertainment alleging violation of its state statute titled "Consumer Protection Against Computer Spyware Act", or CPACSA. The complaint alleges that Sony has sold audio CDs with software, some of which is related to content protection, which software also degrades the consumers' PC performance, and exposes the PC to certain virus threats, without disclosure to consumers. See, full story.

Federal Circuit Affirms Holding Regarding Claim Invalidity in IPXL v. Amazon

11/21. The U.S. Court of Appeals (FedCir) issued its opinion [PDF] in IPXL Holdings v. Amazon, affirming the District Court's holding regarding invalidity of claims.

IPXL filed a complaint in U.S. District Court (EDVa) against Amazon alleging that Amazon's one click system infringes its U.S. Patent No. 6,149,055, titled "Electronic fund transfer or transaction system".

The District Court granted summary judgment to Amazon. It held that Amazon did not infringe the patent, and that all of the claims at issue are invalid. It also awarded attorneys fees to Amazon under 35 U.S.C. § 285. Its opinion is reported at 333 F. Supp. 2d 513.

The Court of Appeals affirmed the holdings regarding invalidity, did not reach the infringement issues, and reversed the award of attorneys fees on the grounds that the motion for attorneys fees was not timely filed.

This case is IPXL Holdings LLC v., Inc., U.S. Court of Appeals for the Federal Circuit, App. Ct. Nos. 05-1009 and 05-1487, appeals from the U.S. District Court for the Eastern District of Virginia, at Alexandria, No. 04-CV-70, Judge Leonie Brinkema presiding. Judge Clevenger wrote the opinion of the Court of Appeals, in which Judges Rader and Schall joined.

7th Circuit Holds Federal Wiretapping Statute Can Apply to Secret Use of Video Cameras

11/21. The U.S. Court of Appeals (7thCir) issued its opinion [PDF] in Doe v. Smith, a civil action for violation of the federal wiretapping statute, which is codified at 18 U.S.C. §§ 2510-22. The Court of Appeals reversed and remanded the District Court's dismissal. The Court of Appeals held that secretly recording with an video camera (that also captures an audio track), and then distributing the recording by e-mail, can constitute a civil violation of the federal wiretapping statute.

The defendant, Jason Smith, used a video camera to secretly record a bedroom encounter with the plaintiff, who brought this suit anonymously as Jane Doe. The camera may have captured audio and video. Smith then distributed the recording by e-mail. One recipient published the recording on the internet.

Doe filed a complaint in U.S. District Court (CDIll) against Smith alleging, among other claims, violation of the federal wiretapping statute. The District Court dismissed this claim. The Court of Appeals reversed.

Most cases involving application of the federal wiretapping statute involve wiretapping. However, the statute applies to interception of "any wire, oral, or electronic communication". Also, while the most common form of interception of oral communications is bugging to obtain the content of conversations, the language of the statute is much broader. Hence, the Court of Appeals reversed, and remanded to the District Court to determine such facts as whether there was an audio track, and whether Doe had an expectation of privacy.

The Court of Appeals wrote that "Doe may be able to establish that the recording had a sound track and that she had an expectation of privacy, the two ingredients of the statutory definition: `` `oral communication´ means any oral communication uttered by a person exhibiting an expectation that such communication is not subject to interception under circumstances justifying such expectation, but such term does not include any electronic communication´´. 18 U.S.C. §2510(2). A silent film would be outside this definition, but most video recorders capture sound as well."

The Court of Appeals continued that "Next comes the question whether Smith ``intercepted´´ the oral communication. This defined term ``means the aural or other acquisition of the contents of any wire, electronic, or oral communication through the use of any electronic, mechanical, or other device.´´ 18 U.S.C. §2510(4). If Doe and Smith engaged in ``oral communication´´ in Smith’s bedroom, then its acquisition by a video recorder -- an ``electronic . . . device´´ -- is covered. And if the interception was forbidden by §2511(1)(a), then its disclosure was forbidden by §2511(1)(c)."

This case is Jane Doe v. Jason Smith, U.S. Court of Appeals for the 7th Circuit, No. 05-1903, an appeal from the U.S. District Court for the Central District of Illinois, D.C. No. 04-3173, Judge Richard Mills presiding. Judge Frank Easterbrook wrote the opinion of the Court of Appeals, in which Judges Williams and Evans joined.

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11/21. The Federal Communications Commission (FCC) rescheduled its next meeting. It had been scheduled for December 15. It is now rescheduled for December 9. December 9 is Commissioner Kathleen Abernathy's last day at the FCC.

Go to News from November 16-20, 2005.