TLJ News from September 26-30, 2011

Copyright Office Opens 5th Triennial Proceeding on DMCA Anti-Circumvention Exemptions

9/29. The Copyright Office (CO) published a notice in the Federal Register that initiates a notice of inquiry, to be followed by a rulemaking proceeding, regarding designating exemptions to the anti-circumvention provisions of the Digital Millennium Copyright Act (DMCA).

The DMCA, enacted in 1998, requires these proceeding every three years. This is the fifth such proceeding. This notice asks for comments regarding what classes of works should be exempt. Comments are due by December 1. The CO will then issue a notice of proposed rulemaking in December that sets out proposed exemptions. The CO will also hold public hearings "in the Spring, in Washington DC and possibly in California".

The anti-circumvention provisions of the DMCA are codified at 17 U.S.C. § 1201, et seq. Subsection 1201(a)(1)(A) provides that "No person shall circumvent a technological measure that effectively controls access to a work protected under this title ...".

Then, § 1201(a)(2)(A) provides that "No person shall manufacture, import, offer to the public, provide, or otherwise traffic in any technology, product, service, device, component, or part thereof, that --- (A) is primarily designed or produced for the purpose of circumventing a technological measure that effectively controls access to a work protected under this title;"

Furthermore, § 1201(b)(1)(A) provides that "No person shall manufacture, import, offer to the public, provide, or otherwise traffic in any technology, product, service, device, component, or part thereof, that --- (A) is primarily designed or produced for the purpose of circumventing protection afforded by a technological measure that effectively protects a right of a copyright owner under this title in a work or a portion thereof; ..."

Then, Subsections 1201(a)(1)(B) through (E) provide for rulemaking proceedings conducted by the CO every three years to establish exemptions to the prohibition of (a)(1)(A) for certain non-infringing uses.

The rules currently in effect, which are codified at 37 C.F.R. § 201.40, designate six exemptions to the prohibition: (1) certain movies on DVD protected by CSC, (2) certain programs that enable wireless phones (especially the iPhone) to execute software applications, (3) programs that enable used wireless phones to connect to a wireless telecommunications network if allowed by the network operator, (4) certain video games, for the purpose of investigating or correcting security flaws, (5) certain programs protected by dongles, and (6) e-book when all e-book editions of the work do not allow read aloud functions.

See also, story titled "Copyright Office Releases 4th Triennial DMCA Exemptions" in TLJ Daily E-Mail Alert No. 2,115, July 30, 2010. It has been just over one year since the current rules were released and took effect. However, the CO was late in releasing those rules. It extended the effective term of the 3rd triennial rules. The FR notice states that the CO will release it 5th triennial rules by February 15, 2012.

The just released notice advises prospective commenters that "in order to make a prima facie case for a proposed exemption, certain critical points should be established. First, a proponent should identify the technological measure that is the ultimate source of the alleged problem, and the proponent should explain how the technological measure effectively controls access to a copyrighted work."

Second, "a proponent must specifically explain what noninfringing activity the prohibition on circumvention is preventing. In addition to describing the activity, the proponent should provide a factual basis for a determination that the technological measure has had or is likely to have a substantial adverse effect on noninfringing uses; demonstrating
only isolated instances of relatively minimal adverse effects is not likely to meet the proponent's burden."

Third, "a proponent should establish that the prevented activity is, in fact, a noninfringing use under current law. A proponent should also demonstrate why the access-protected copy of a work is needed for the noninfringing use and why alternate means of engaging in the noninfringing uses (including use of available copies of the work in unprotected formats), if they exist, are an insufficient substitute for accomplishing the noninfringing use."

Copyright Office Opens Rulemaking Proceeding on Section 512 Designation of Agents to Receive Notices of Copyright Infringement

9/28. The Copyright Office (CO) published a notice in the Federal Register that announces, describes, recites, and requests comments on, its proposed rules governing the designation by online service providers of agents to receive notifications of claimed copyright infringement. The CO proposes shifting to a system in which service providers must make their designation electronically, via the web. 

The safe harbor provision of 17 U.S.C. § 512 provides, at subsection (c)(1), that "A service provider shall not be liable for monetary relief, or, ... for injunctive or other equitable relief, for infringement of copyright by reason of the storage at the direction of a user of material that resides on a system or network controlled or operated by or for the service provider, if the service provider", among other things, "does not have actual knowledge that the material or an activity using the material on the system or network is infringing".

One of the requirements for qualifying for this immunity is complying with the notice and take down provisions of Section 512. The first component of this is maintaining an agent for receiving notices of claimed infringement.

Subsection 512(c)(2) provides that "The limitations on liability established in this subsection apply to a service provider only if the service provider has designated an agent to receive notifications of claimed infringement ... by making available through its service, including on its website in a location accessible to the public, and by providing to the Copyright Office, substantially the following information:
  (A) the name, address, phone number, and electronic mail address of the agent.
  (B) other contact information which the Register of Copyrights may deem appropriate.
The Register of Copyrights shall maintain a current directory of agents available to the public for inspection, including through the Internet, in both electronic and hard copy formats, and may require payment of a fee by service providers to cover the costs of maintaining the directory."

The Copyright Office (CO) has maintained implementing regulations, as required by this statute, since 1998. This notice states that "issues have arisen with respect to the currency and accuracy of the information in the directory, and the Office also intends to implement an electronic process by which service providers may designate agents to receive notifications of claimed infringement and an electronic database to search for designated agents of online service providers".

The CO proposed to eliminate paper filing, and mandate electronic filing as the only way to designate agents. The CO would then maintain an online database of designated agents that is accessible via the web to the public.

The CO proposes to allow the use of third party agents not employed by the service provider.

The CO proposes to require periodic validation of designations, either annually, or every two years, to weed out businesses that have ceased operations. Service providers would also be able to electronically amend their designation information at any time.

The proposed rules also address overlapping designations, such as when a web site is sold, and the new owner submits a designation of agent to the CO, while the previous owner's designation is still on record, or when someone makes a fraudulent designation.

The CO also proposes that all service providers must file anew under the new system. The proposed rules also address the transition period in which new filings are being made.

The notice also addresses fees.

The notice acknowledges that maintaining actual e-mail addresses in the CO's online database, rather that text (i.e., name at domain dot com) or graphic versions, would facilitate automated harvesting of these e-mail addresses in support of spam e-mailing. Nevertheless, it proposes the use of actual e-mail addresses. Perhaps is should be noted that this notice does not include the e-mail address of the CO attorney in charge of this proceeding in any format.

The statute requires the service provider to designate a "name". The notice asks "whether an online service provider must provide the actual name of a natural person or whether the name of a specific position or title will satisfy this requirement".

The notice also asks "whether requiring a separate designation for each web address is the preferable means of organizing the directory. If so, a further question arises as to whether service providers should continue to be able to identify additional names by which they are known, which would be searchable in the directory. Conceivably, the web address is the primary or even the only name that a person searching the directory would need to ascertain who the
designated agent of a service provider is." It also asks what would be meant by "web site".

The deadline to submit initial comments is November 28, 2011. The deadline to submit reply comments is December 27, 2011. See, Federal Register, Vol. 76, No. 188, Wednesday, September 28, 2011, at Pages 59953-59960.

ACTA Signing Set for October 1 in Tokyo

9/28. The parties to the Anti-Counterfeiting Trade Agreement (ACTA) will sign the agreement at a ceremony in Tokyo, Japan on October 1, 2011. See, weekly calendar of the Office of the U.S. Trade Representative (OUSTR).

The OUSTR also announced that Deputy USTR Miriam Sapiro will represent the US at the signing ceremony, and will participate in bilateral meetings.

The Ministry of Foreign Affairs of Japan stated in a release that "The Agreement was inspired in significant part by Japan's proposal at the G8 Gleneagles Summit in 2005 to create a new international framework against counterfeit and pirated products, in the context of the heightened awareness of the need for a higher degree of intellectual property protection. Its negotiation has been led by a strong initiative of Japan, the United States and other key partners."

The ACTA establishes certain minimum requirements for the nations that are parties to the ACTA, and permits parties to establish certain other requirements. It focuses on copyrights and trademarks. However, it does not state that none of its provisions apply in the context of patents. It addresses, among other things, civil enforcement, border measures, criminal enforcement, and digital works.

For more on the ACTA, see stories titled "ACTA Draft Released", "Summary of ACTA", and "Reaction to ACTA" in TLJ Daily E-Mail Alert No. 2,140, October 11, 2010.

The parties to the ACTA are Australia, Canada, the European Union and its Member States, Japan, Korea, Mexico, Morocco, New Zealand, Singapore, Switzerland, and the US.

Gigi Sohn, head of the Public Knowledge (PK), stated in a release that "the Obama Administration should make it clear that the Agreement is consistent with, and does not change, U.S. law, particularly the safe harbor provisions of the Digital Millennium Copyright Act".

She also complained that "the process by which it was reached was extremely flawed. ACTA should have been considered a treaty, and subject to public Senate debate and ratification or, in the alternative, debated in an open and transparent international forum such as the World Intellectual Property Organization (WIPO). Instead, public interest groups and the tech industry had to expend enormous resources to force the process open to permit public views to be presented and considered."

Senators Introduce Bill Regarding PRC Currency Exchange Rate

9/28. Sen. Sherrod Brown (D-OH) and others introduced S 1619 [LOC | WW], the "Currency Exchange Rate Oversight Reform Act of 2011", on September 22, 2011. The Senate may take up this bill as early as October 3.

The bill has 19 original cosponsors, from both parties, who are spread across the ideological spectrum. However, support for this bill in concentrated in the eastern states. Of the 20 sponsors, only one represents a state on or west of the Mississippi River.

The bill does not reference the People's Republic of China (PRC), but it is directed at the PRC. Sen. Brown's stated in a release that "The illegal and unfair manipulation of the yuan by the Chinese government has gone on for far too long ... We must equip the Obama Administration with the tools it needs to crack down on China's currency manipulation and help level the playing field for American businesses."

Sen. Olympia Snowe (R-ME), an original cosponsor of the bill, issued a release that states that "China's ongoing undervaluation of the Yuan continues to cause severe economic disruptions and imbalances globally and is taking a huge toll on manufacturers and workers across the United States. Moreover, failure to address China's currency manipulation has emboldened China to countenance other market-distorting policies, including discriminatory indigenous innovation policies and inadequate protection of intellectual property, that benefit companies in China at the expense of U.S. companies and workers."

Sen. Charles Schumer (D-NY) stated in a release that "This is not about China bashing". He wrote that "We are sending a clear message to the Chinese government: if you refuse to play by the same rules as everyone else, we will force you to."

The Club for Growth stated in a release that "This proposal would make it easier for the government to slap punitive tariffs on ``nonmarket´´ economies -- in particular China -- if an exporting country's currency is considered misaligned against the U.S. dollar. This is a disastrous proposal that would increase taxes on American consumers, stall the economic recovery, and spark an ugly trade war that would benefit no one."

This bill provides that the Department of the Treasury (DOT) "shall analyze on a semiannual basis the prevailing real effective exchange rates of foreign currencies", and "With respect to the currencies of countries that have significant bilateral trade flows with the United States, and currencies that are otherwise significant to the operation, stability, or orderly development of regional or global capital markets, the Secretary shall determine whether any such currency is in fundamental misalignment and shall designate such currency as a fundamentally misaligned currency".

The bill would also lessen the requirements for making such a finding.

If the DOT so designates a country, the DOT then "shall seek to consult bilaterally with the country that issues such currency in order to facilitate the adoption of appropriate policies to address the fundamental misalignment".

Next, if the DOT "determines that the country that issues such currency has failed to adopt appropriate policies, or take identifiable action, to eliminate the fundamental misalignment", it shall first resort to, among other things, the existing US antidumping process.

Next, the DOT shall resort to submitting a complaint with the World Trade Organization (WTO) and requesting the Federal Reserve Board (FRB) and other central banks to intervene in currency markets.

Ben Bernanke, Chairman of the FRB, gave a speech in Frankfurt, Germany, on this topic titled "Rebalancing the Global Recovery", on November 19, 2011. See also, story titled "Bernanke Addresses PR China and Global Economy" in TLJ Daily E-Mail Alert No. 2,162, November 22, 2011.

The Senate is scheduled to consider a motion to proceed to this bill on Monday, October 3, 2011.

Sen. Orrin Hatch (R-UT) sent a letter to Timothy Geithner (Secretary of the Treasury) and Ron Kirk (U.S. Trade Representative) on September 28 stating that "Before the Senate moves forward, it's imperative that the 100 members of this body have a full understanding of the Administration's views on this legislation."

He asked Geithner to address "constitutional, legal, or other policy concerns the Administration has with the currency provisions included in the bill".

He asked Kirk to address the bill's WTO and trade policy implications, such as whether enactment of the bill would violate the US's WTO obligations.

More News

9/28. Ben Bernanke, Chairman of the Federal Reserve Board (FRB), gave a speech in Cleveland, Ohio, titled "Lessons from Emerging Market Economies on the Sources of Sustained Growth". He stated that an "important lesson of the past two decades involves the pivotal role of technology in economic development. For emerging market economies, which tend to lag behind in technological sophistication, rapid gains in productivity can be achieved by adapting state-of-the-art technologies already developed by the advanced economies rather than by having to develop these technologies from scratch. But successful importing of technologies does not happen automatically or without preparation. For example, strong educational systems producing increasingly skilled workforces have proven crucial for climbing the technological ladder". He concluded that "advanced economies like the United States would do well to re-learn some of the lessons from the experiences of the emerging market economies, such as the importance of disciplined fiscal policies, the benefits of open trade, the need to encourage private capital formation while undertaking necessary public investments, the high returns to education and to promoting technological advances, and the importance of a regulatory framework that encourages entrepreneurship and innovation while maintaining financial stability".

9/28. Google disclosed in a release that it has received a second request from the Department of Justice's (DOJ) Antitrust Division, which is reviewed Google's planned acquisition of Motorola Mobility. See, story titled "Google to Acquire Motorola Mobility" in TLJ Daily E-Mail Alert No. 2,290, August 15, 2011.

9/28. The U.S. Patent and Trademark Office (USPTO) announced in a release that itsPatent and Trademark Depository Libraries (PTDLs) will become known as Patent and Trademark Resource Centers (PTRCs) on October 1, 2011.

9/28. Microsoft announced in a release that it and Samsung Electronics have signed a definitive agreement for patent cross licensing related to phones and tablets. Microsoft stated that "Microsoft will receive royalties for Samsung’s mobile phones and tablets running the Android mobile platform. In addition, the companies agreed to cooperate in the development and marketing of Windows Phone." Microsoft's Brad Smith and Horacio Gutierrez stated in a release that "Together with the license agreement signed last year with HTC, today’s agreement with Samsung means that the top two Android handset manufacturers in the United States have now acquired licenses to Microsoft’s patent portfolio. These two companies together accounted for more than half of all Android phones sold in the U.S. over the past year. That leaves Motorola Mobility, with which Microsoft is currently in litigation, as the only major Android smartphone manufacturer in the U.S. without a license."

9/28. The House Foreign Affairs Committee (HFAC) announced that it will hold a hearing titled "Why Taiwan Matters, Part II", on October 4, 2011, at 10:00 AM. See, notice.

Representatives Markey and Barton State That Facebook Tracking of Users Violates FTC Act

9/27. Rep. Ed Markey (D-MA) and Rep. Joe Barton (R-TX) sent a letter to Jonathan Leibowitz, Chairman of the Federal Trade Commission (FTC) regarding Facebook's use of cookies to surveil its users' web activity after visiting the Facebook website. See also, Rep. Markey's release and Rep. Barton's release.

They wrote that "Facebook has admitted that to collecting information about its users even after its users had logged out of Facebook."

The two wrote that "we believe that tracking user behavior without their consent or knowledge raises serious privacy concerns. When users log out of Facebook, they are under the expectation that Facebook is no longer monitoring their activities. We believe that this impression should be the reality. Facebook users should not be tracked without their permission."

They also stated that this practice constitutes a violation of Section 5 of the FTC Act, which is codified at 15 U.S.C. § 45. It provides in part that "Unfair methods of competition in or affecting commerce, and unfair or deceptive acts or practices in or affecting commerce, are hereby declared unlawful."

And, they ask about any actions that the FTC "has taken or plans to take to investigate this practice by Facebook".

Rep. Markey and Rep. Barton are senior members of the House Commerce Committee, but not currently the Chairman or ranking Democrat of the Committee or any of its Subcommittees. The two frequently work together on online privacy issues.

People and Appointments

9/27. The U.S. Patent and Trademark Office (USPTO), which administers the award of the National Medal of Technology and Innovation announced the latest set of winners: Rakesh Agrawal (Purdue University), Jayant Baliga (North Carolina State University), Donald Bateman (Honeywell), Yvonne Brill (formerly with RCA Astro Electronics), Michael Tompsett (TheraManager). See, USPTO release.

9/27. President Obama announced his intent to nominate Glen Post to be a member of the President's National Security Telecommunications Advisory Committee (PNSTAC). See, White House news office release. Post is P/CEO of CenturyLink, a provider of voice, video and internet access services based in the state of Louisiana.

More News

9/27. Lawrence Strickling, head of the National Telecommunications and Information Administration (NTIA), gave a speech in Nairobi, Kenya, regarding internet governance. He stated that "the future of the Internet is at risk.  The multistakeholder model is being challenged.  In the last year, we have seen more and more instances of restrictions on the free flow of information online, disputes between standards bodies and even appeals from incumbent carriers for government intervention on the terms and conditions for exchanging Internet traffic. We have seen statements from international organizations and some governments that call for more direct regulation of the Internet." He added that "All nations should step up in support of the free and open Internet and the multistakeholder process".

9/27. The National Telecommunications and Information Administration (NTIA) released a report [15 pages in PDF] titled "Broadband Technology Opportunities Program (BTOP) Quarterly Program Status Report". Also, Lawrence Strickling, head of the NTIA, gave a speech on September 23, 2011, in which he addressed BTOP spending.

9/27. The National Institute of Standards and Technology's (NIST) Computer Security Division (CSD) released its draft SP 800-121 Rev. 1 [49 pages in PDF], titled "Guide to Bluetooth Security". The deadline to submit comments is October 28, 2011.

People and Appointments

9/26. The Senate confirmed Robert Zimmer and Arnold Stancell to be members of the National Science Foundation's (NSF) National Science Board (NSB). See, Congressional Record, September 26, 2011, at Page S6009.

9/26. President Obama named 94 persons as recipients of the Presidential Early Career Awards for Scientists and Engineers. See, White House news office release.

More News

9/26. The National Institute of Standards and Technology's (NIST) Computer Security Division (CSD) released its draft SP 800-153 [24 pages in PDF], titled "Guidelines for Securing Wireless Local Area Networks (WLANs)". The deadline to submit comments is October 28, 2011.

Go to News from September 21-25, 2011.