TLJ News from January 26-31, 2011

GAO Reports on H1B Visa Program

1/31. The Government Accountability Office (GAO) released a report [118 pages in PDF] on January 14, 2011, titled "H-1B Visa Program: Reforms Are Needed to Minimize the Risks and Costs of Current Program".

Sen. Charles Grassley (R-IA) and Sen. Dick Durbin (D-IL) sent a letter [PDF] on January 31, 2011, to the DHS regarding this GAO report.

Information technology companies have long relied upon, and lobbied for extensions and expansions of, this program. This report also states that it is plagued with fraud and abuse.

See also, story titled "H1B Visas, Tech Sector Jobs, and Visa Fraud" in TLJ Daily E-Mail Alert No. 1,808, August 7, 2008.

The GAO report offers this description. "The current H-1B program, which permits U.S. employers to hire foreign workers in specialty occupations, was authorized in 1990.The same law also placed a cap of 65,000 on H-1B visas issued per fiscal year beginning in fiscal year 1992. However, since then, the cap has fluctuated with legislative changes, reaching a peak of 195,000 in fiscal years 2001 to 2003. Today, the cap is set at 65,000 ..." (Footnote omitted.)

The Department of Homeland Security's (DHS) U.S. Customs and Immigration Service (USCIS) has primary responsibility for administering the H1B program. However, the Department of State and Department of Labor are also involved.

The report states that "Congress sought to strike a difficult balance between satisfying the needs of a wide variety of businesses for high-skilled foreign labor while protecting access to jobs and appropriate compensation for U.S. workers."

"The initial temporary nature of the program and the annual cap were key tools to protect U.S. workers. Over its history, however, Congress has made numerous changes to the program, including broadening the eligibility requirements and allowing for exemptions to the cap and for H-1B workers to pursue long-term residency."

The report finds that as a result "the number of H-1B workers approved to enter the United States each year greatly exceeds the numeric limit established by the cap, and the majority of applicants are categorized as entry-level. Moreover, a substantial proportion appears to remain in the country beyond the 6-year visa period in pursuit of permanent residency."

The report also finds that "Lack of information on the total H-1B workforce makes it impossible to understand the long-term impact of the program and leaves the program vulnerable to fraud and abuse -- a known issue in this program." The report also points to the lack of information sharing within and between federal agencies, limitations on enforcement, and the use of intermediary staffing companies, furthers fraud, abuse and lack of enforcement.

The report also addresses business's concerns about the structure of the program.

Also, it notes that "start-up companies, which some argue are the backbone of innovation in the United States, cannot use the H-1B visa for their employees until their company is fully established."

The report concludes that "the program may not be used to its full potential and may be detrimental in some cases. Some improvements can be made."

Sen. Grassley and Sen. Durbin stated in their letter to the DHS that "We are committed to restoring integrity to the H-1B visa program". The two Senators asked for explanations and elaborations of many of the findings contained in the GAO report.

The two stated in a release that "The H-1B visa program is riddled with loopholes and is in need of serious reform. It's time to put integrity back into the program, and ensure that the program works for American workers and businesses".

President Obama alluded to H1B visas in his speech to the Congress on January 25, 2011. He said that "Others come here from abroad to study in our colleges and universities. But as soon as they obtain advanced degrees, we send them back home to compete against us. It makes no sense."

More News

1/31. The Department of Justice (DOJ) announced in a release that Oracle has agreed to give the federal government $46 Million to settle claims that Sun Microsystems, which Oracle acquired in 2010, submitted false claims to the General Services Administration (GSA) and other federal agencies in violation of the Federal Claims Act.

Senate Judiciary Committee Begins Consideration of Patent Bill

1/27. Sen. Patrick Leahy (D-VT), Sen. Charles Grassley (R-IA), Sen. Orrin Hatch (R-UT), and others introduced S 23 [LOC | WW], the "Patent Reform Act of 2011", on January 25, 2011. The bill was on the agenda for the Senate Judiciary Committee's (SJC) executive business meeting on January 27, but was held over until the meeting of February 3.

This bill provides a first inventor to file rule, and addresses damages for patent infringement, post grant review, the best mode requirement, and venue in patent cases, among other topics. The text of S 23, and Sen. Leahy's statement, is in the January 25, 2011, issue of the Congressional Record, beginning at Page S130.

Sen. Grassley requested that it be held over for one week

Sen. Hatch said to Sen. Leahy, the Chairman of the SJC, at the meeting that "I would like to compliment you on this patent bill. To make that a focal point at the beginning of this session is very very important. We haven't amended the patent laws for well over fifty years. It is time that we do it, and go to conference, and hopefully come up with a bill that both sides will enthusiastically support. Without your leadership I don't think that can happen, and we need to do that."

Sen. Leahy said that Rep. Lamar Smith (R-TX), the Chairman of the House Judiciary Committee (HJC), "is committed to doing something". Sen. Leahy also compared this process to a civil litigation. "Sometimes you settle the case on the courthouse steps". He concluded, "It is jury drawing time."

Sen. Grassley said that "it is going to spur innovation and economic growth. ... I am supportive of these efforts and I am hopeful that we will see comprehensive patent reform implemented expeditiously in this Congress".

He also said the he wants this Congress to "pass legislation to rid the courts of frivolous lawsuits".

HR 243 [LOC | WW], the "Patent Lawsuit Reform Act of 2011", introduced by Rep. Robert Latta (R-OH) on January 7, 2011, deals only with 35 U.S.C. 292, and the issue of penalties for false markings.

Judicial Nominees Held Over

1/27. The Senate Judiciary Committee (SJC) held an executive business meeting at which it held over all judicial nominees on the agenda: James Graves (USCA/5thCir), Edward Davila (USDC/NDCal), Amy Jackson (USDC/DC), Max Cogburn (USDC/WDNC), Marco Hernandez (USDC/DOre), Steve Jones (USDC/NDGa), Amy Totenberg (USDC/NDGa), James Boasberg (USDC/DC), Paul Holmes (USDC/WDArk), Anthony Battaglia (USDC/SDCal), and Diana Saldana (USDC/SDTex).

Sen. Charles Grassley (R-IA), the ranking Republican on the SJC, requested that all nominations be held over for one week. Sen. Patrick Leahy (D-VT), the Chairman of the SJC, announced that all are held over, but complained about Republican refusal to hold votes in the full Senate on some nominees who have the support of their home state Senators, and have been approved by the SJC.

Sen. Orrin Hatch (R-UT), who has served on the SJC for over thirty years, noted that over the decades both parties have blocked nominees. He said that "we have to work together better on Judges". Sen. Hatch also said that "it is insane to have to have a vote on everybody who comes to the floor".

President Obama's judicial nominees will face more difficulties in being confirmed in the 112th Congress. The decreased size of the Democrats' majority in the Senate will make it easier for Republican opponents of certain nominees to sustain a filibuster.

The discussion at this SJC meeting regarding the qualifications of particular nominees, and what in general ought to be the criteria for assessing judicial nominees, again lacked any mention of expert knowledge in core areas of law that fall within federal jurisdiction, such as patent, copyright, communications, and antitrust law.

People and Appointments

1/27. Sen. Ben Cardin (D-MD) is leaving the Senate Judiciary Committee (SJC). He will join the Senate Finance Committee (SFC). Sen. Patrick Leahy (D-VT) and Sen. Orrin Hatch (R-UT) praised his service on the SJC at the January 27, 2011 meeting of the SJC.

Obama Picks Verrilli to Be Solicitor General

1/26. President Obama nominated Donald Verrilli to be Solicitor General (SG) of the United States, at the Department of Justice (DOJ). See, White House news office release and release. If confirmed, he would replace former SG Elena Kagan, who is now a Justice of the Supreme Court. Neal Katyal is the acting SG.

Verrilli has recently worked for the Obama administration at the DOJ and White House, working on, among other issues, the state secrets privilege. The state secrets privilege is a judicial privilege, belonging to the executive, against disclosure of information in judicial processes, that may harm national security.

The Obama administration, like the Bush administration before it, has aggressively asserted the privilege not merely to preclude disclosure of certain information, but to preclude entire adjudicatory processes, in effect to confer immunity upon itself and the companies that assist it in conducting surveillance activities.

The privilege is not inherently a technology related matter. It has been invoked in some cases, such as those involving rendition of terrorists to foreign governments, that are not technology related. However, it is also invoked in cases that do involve information and communications technologies (ICT), such as suits involving warrantless wiretaps.

See also, story titled "Holder Issues Memorandum on State Secrets Privilege" in TLJ Daily E-Mail Alert No. 1,988, September 24, 2009, subsection titled "TLJ Analysis" in story titled "9th Circuit Rules in State Secrets Case" in TLJ Daily E-Mail Alert No. 1,933, April 29, 2009, and subsection titled "State Secrets Privilege" in story titled "House Judiciary Subcommittee Holds Hearing on Civil Liberties and ICT Issues" in TLJ Daily E-Mail Alert No. 2,177, December 13, 2010.

Both the House and the Senate considered bills regarding the privilege in the 110th and 111th Congresses. However, no bill became law. See for example, S 417 [LOC | WW], the "State Secrets Protection Act", and HR 984 [LOC | WW], the "State Secret Protection Act of 2009", both from the 111th Congress.

Verrilli is currently Deputy Counsel to the President. Before that, he was an Associate Deputy Attorney General.

Before that, Verrilli was a long time partner in the Washington DC office of Jenner & Block, and an entertainment industry copyright lawyer. For example, Verrilli argued before the Supreme Court on behalf of the movie industry in the peer to peer infringement case, MGM v. Grokster. See, opinion [55 pages in PDF] and stories titled "Supreme Court Rules in MGM v. Grokster" and "Reaction to the Supreme Court's Opinion in MGM v. Grokster" in TLJ Daily E-Mail Alert No. 1,163, June 28, 2005.

Verrilli has also represented communications companies. For example, he successfully argued before the Supreme Court in FCC v. Next Wave Personal Communications, 537 U.S. 293. See, January 27, 2003, opinion, and story titled "Supreme Court Rules Against FCC in NextWave Case" in TLJ Daily E-Mail Alert No. 592, January 28, 2003.

Obama Picks Cohen for Treasury Position

1/26. President Obama nominated David Cohen to be the Department of the Treasury's (DOT) Under Secretary for Terrorism and Financial Crimes, the position previously held by Stuart Levey. See, White House news office release and release.

Cohen has been the DOT's Assistant Secretary for Terrorist Financing since May of 2009. Before that he was briefly Counselor to the Secretary of Treasury. See, March 8, 2009 release. Before that he worked for the law firm of Wilmer Hale.

The primary task of this Under Secretary is to attempt to monitor and limit financing of terrorism. In performing this task, the DOT acquires personal and financial transactions data, and builds electronic databases. See, June 23, 2006 story in the New York Times by Eric Lichtblau and James Risen titled "Bank Data Is Sifted by U.S. in Secret to Block Terror".

Obama Picks Cablevision Lawyer for SDNY

1/26. President Obama nominated Paul Oetken to be a Judge of the U.S. District Court for the Southern District of New York. See, White House news office release and release.

He is SVP and Associate General Counsel of Cablevision Systems Corporation. Before that, he worked for the law firm of Debevoise & Plimpton.

Before that, he worked in the Department of Justice's (DOJ) Office of Legal Counsel (OLC) and the White House Counsel's Office in the Clinton administration. And before that, he worked for the law firm of Jenner & Block.

More Judicial Appointments

1/26. President Obama nominated Henry Floyd to be a Judge of the U.S. Court of Appeals (4thCir). He has been a Judge of the U.S. District Court (DSCar) since 2003. Before that he was a South Carolina state court judge before that. See, White House news office release and release.

1/26. President Obama nominated Michael Green to be a Judge of the U.S. District Court for the Western District of New York. See, White House news office release and release.

1/26. President Obama nominated Nelva Ramos to be a Judge of the U.S. District Court for the Southern District of Texas. See, White House news office release and release.

1/26. President Obama nominated Natasha Silas to be a Judge of the U.S. District Court for the Northern District of Georgia. See, White House news office release and release.

1/26. President Obama nominated Linda Walker to be a Judge of the U.S. District Court (NDGa). See, White House news office release and release.

More People and Appointments

1/26. President Obama renominated several persons for trade related positions:

Go to News from January 21-25, 2011.