TLJ News from January 11-15, 2013

House Bill Would Provide that Obama NS/EP EO Creates No Authority to Regulate Private Sector

1/15. Rep. Richard Nugent (R-FL) introduced HR 294 [LOC | WW], an untitled bill that would clarify that an  executive order (EO) issued by President Obama last July regarding "national security" and "emergency communications preparedness" does not give the Department of Homeland Security (DHS) regulatory authority over commercial or privately owned networks or service providers.

President Obama issued his broadly and vaguely worded Executive Order 13618 on July 6, 2012. It was published in the Federal Register (FR) on July 11, 2012. See, FR, Vol. 77, No. 133, July 11, 2012, at Pages 40779-40783.

This EO assigns responsibilities to various executive branch entities with respect to "national security" and "emergency preparedness" communications, also known as NS/EP.

This EO also purports to give the DHS regulatory authority over privately owned communications companies. This EO does not cite any authority for this provision, other than "the Constitution and the laws of the United States".

There is such authority. This represents an attempt by President Obama to expand executive powers by EO. President Obama has also threatened to impose a cyber security regulatory regime by EO.

Section 5.2 of the EO provides that "The Secretary of Homeland Security shall ... (e) satisfy priority communications requirements through the use of commercial, Government, and privately owned communications resources ..."

This bill states that "Section 5.2(e) of Executive Order 13618 ... is revoked to the extent that it refers to communications resources that are privately owned."

It adds that "No agency or instrumentality of the Federal Government may satisfy priority communications requirements (as such term is used in section 5.2(e) of Executive Order 13618) through the use of privately owned communications resources, and no funds appropriated pursuant to any provision of law may be used to take any action that expands the authority of the Federal Government to control privately owned communications resources."

This bill was referred to the House Commerce Committee (HCC). Rep. Nugent is not a member.

USPTO Seeks Comments on Preparation of Patent Applications

1/15. The U.S. Patent and Trademark Office (USPTO) published a notice in the Federal Register (FR) requesting comments regarding potential practices that patent applicants can employ at the drafting stage of a patent application in order to facilitate examination and bring more certainty to the scope of issued patents. The deadline to submit comments is March 15, 2013.

On January 3 the USPTO published a notice in the FR that announced two roundtables, to be held at Stanford University and New York University, regarding software patents. That notice also requested comments by March 15. See also, story titled "USPTO Announces Roundtables on Software Patents" in TLJ Daily E-Mail Alert No. 2,503, January 3, 2013.

The present notice also discloses that the USPTO "plans to issue a separate notice building on internal initiatives and further identifying potential practices the Office can employ to also facilitate examination and bring more certainty to the scope of issued patents."

The present notice lists numerous practices that applicants might employ in identifying the scope of each claim when preparing their patent applications, and asks for public comments on each.

This notice also lists numerous practices that applications might employ in writing the specification, and asks for public comments on each.

See, FR, Vol. 78, No. 10, January 15, 2013, at Pages 2960-2961.

USTR Kirk Writes Congress Regarding Negotiation of Services Trade Agreement

1/15. Ron Kirk, the U.S. Trade Representative, sent letters to Congressional leaders announcing that "the Administration intends to enter negotiations for a new trade agreement aimed at promoting international trade in services".

The letters add that "We will be conducting negotiations with an initial group of 20 trading partners -- Australia, Canada, Chile, Chinese Tapei, Columbia, Costa Rica, European Union on behalf of its member states, Hong Kong China, Iceland, Israel, Japan, Korea, Mexico, New Zealand, Norway, Pakistan, Panama, Peru, Switzerland, and Turkey."

"The agreement must seek to secure greater transparency and predictability from our trading partners regarding regulatory policies that present barriers to trade in services and hinder U.S. exports. To address this challenge, we will seek agreement on practices like providing the public with advance notice and an opportunity to comment on proposed regulations ..."

The letters also states that "the agreement must address new issues arising in the global marketplace and changes the way we trade", including increased internet usage. "The development of appropriate provisions to support services trade through electronic channels therefore must be an important component of any new agreement."

The OUSTR also noted in a release that "In 2011, the United States had a $178.5 billion surplus in services trade worldwide."

DC Circuit Grants Petitions for Review in Echostar v. FCC

1/15. The U.S. Court of Appeals (DCCir) issued its opinion in Echostar v. FCC, granting the petitions for review of the Federal Communications Commission's (FCC) encoding rules for satellite companies, and vacating.

On December 19, 2002, fourteen consumer electronics companies and seven cable operators announced that they entered into a Memorandum of Understanding (MOU) regarding a national plug and play standard between digital television (DTV) products and digital cable systems. However, the MOU contemplated imposing rules, not only on cable service providers, but all multichannel video programming distributors (MVPDs). The FCC then implemented this MOU with rules.

It issued a Further Notice of Proposed Rulemaking (FNPRM) regarding a proposed set of rules pertaining to plug and play cable compatibility. It received comments. It then released a Second Report and Order and Second Further Notice of Proposed Rulemaking (R&O). This R&O was FCC 03-225 in CS Docket 97-80 and PP Docket 00-67. The FCC also later released an Order on Reconsideration (OR).

See also, stories titled "FCC Seeks Comments on Cable TV Plug and Play MOU" in TLJ Daily E-Mail Alert No. 581, January 13, 2003, and "Comment Period Closes in FCC's Plug and Play Cable Compatibility Rulemaking Proceeding" in TLJ Daily E-Mail Alert No. 655, May 5, 2003, and "FCC Adopts Digital Plug and Play Cable Compatibility Rules" in TLJ Daily E-Mail Alert No. 737, September 11, 2003.

Echostar Satellite (now Dish Network) is a direct broadcast satellite (DBS) service provider. It challenged both the R&O and OR on the grounds that they impose encoding rules, which limit the means of encoding that cable and DBS service providers may employ to prevent unauthorized access to their broadcasts. Dish argued that the FCC lacked statutory authority to impose these encoding rules on DBS service providers, and that they are arbitrary and capricious.

The Court of Appeals held that the FCC lacked statutory authority to impose these encoding rules on DBS service providers. It did not reach the arbitrary and capricious argument. The Court of Appeals granted the petitions, and vacated.

The FCC argued that it had statutory authority under Section 629(a) of the Telecommunications Act of 1996, which is codified at 47 U.S.C. § 549(a).

It provides that the FCC "shall, in consultation with appropriate industry standard-setting organizations, adopt regulations to assure the commercial availability, to consumers of multichannel video programming and other services offered over multichannel video programming systems, of converter boxes, interactive communications equipment, and other equipment used by consumers to access multichannel video programming and other services offered over multichannel video programming systems, from manufacturers, retailers, and other vendors not affiliated with any multichannel video programming distributor."

The Court wrote that "§ 629 provides no explicit textual basis for the encoding rules", and the FCC's interpretation founders on the second step of the test set by the Supreme Court in Chevron U.S.A., Inc. v. Natural Resources Development Council, 467 U.S. 837 (1984).

The FCC also argued that it had ancillary authority under Section 629 and Section 624A of the Communications Act, which is codified at 47 U.S.C. § 544a, which gives the FCC rule making authority with respect to compatibility between electronics equipment and "cable systems".

The Court wrote that "The FCC contends the encoding rules are reasonably ancillary to its mission of assuring the commercial availability of navigation devices because they removed one of the ``stumbling blocks´´ to the consumer electronics industry's production of such equipment for retail: the ``inability of industry to agree on a comprehensive set of technical copy protection measures and corresponding encoding rules´´ that would ``ensure the availability of high value content to consumers in a protected digital environment.´´ ... Yet by this standard, there is little the FCC could not regulate in the name of fulfilling § 629's mandate."

The National Cable and Telecommunications Association (NCTA) intervened in support of the FCC. It wrote in its brief that "Section 624A provides the Commission authority to adopt such rules with respect to cable operators. If Section 629 means anything, it means that the Commission now has authority to apply the same encoding rules to all MVPDs. On that basis, the Court should affirm the encoding rules."

This case is Echostar Satellite LLC v. FCC and USA, respondents, and National Cable and Telecommunications Association, intervenor, U.S. Court of Appeals for the District of Columbia, App. Ct. Nos. 04-1033 and 04-1109, petitions for review of a final order of the FCC. Judge Brown wrote the opinion of the Court of Appeals, in which Judge Randolph joined. Judge Edwards wrote a concurring opinion.

FAA Act and Proposed Rule Limit Flight Crew Use of Laptops and Wireless Devices on Aircraft

1/15. The Department of Transportation's (DOT) Federal Aviation Administration (FAA) published a notice in the Federal Register (FR) that announces, describes, recites, and sets the comment deadline for, its proposed rule regarding limiting flightcrew members personal use of personal wireless communications devices or laptop computers on aircraft.

However, this proposed rule would merely implement by rule the parallel statutory prohibition enacted in Section 307 of HR 658 [LOC | WW], the "FAA Modernization and Reform Act of 2012".

The proposed rule provides that "During all flight time as defined in 14 CFR 1.1, no flight crewmember may use, nor may any pilot in command permit the use of, a personal wireless communications device or laptop computer while at a flight crewmember duty station unless the purpose is directly related to operation of the aircraft, or for emergency, safety-related, or employment-related communications, in accordance with air carrier procedures approved by the Administrator."

The deadline to submit comments is March 18, 2013. See, FR, Vol. 78, No. 10 January 15, 2013, at Pages 2912-2916.

IPR News

1/15. Authors Guild (AG) published a short piece on January 14 titled "Condé Nast Moves to Seize, Lowball Freelancers' Film/TV Rights", and another short piece on January 15 titled "Condé Nast query: What makes a rights grab?" The AG complains that Conde Nast, which owns Ars Technica, Wired, The New Yorker, and numerous other publications, has changed its standard contract for free lance writers to obtain an option in dramatic and multimedia rights to articles appearing in its magazines. See also, January 13, 2013 article in the New York Times by Christine Haughney titled "Condé Nast Writer Deals Stir Dispute".

1/15. David Kappos, head of the U.S. Patent and Trademark Office (USPTO), wrote a short piece titled "Interviews and Patent Quality". He wrote that "well-documented interviews lead to high quality patents by enhancing understanding and issue-resolution for both applicants and examiners". Moreover, the USPTO has just analyzed data to back this up. Kappos wrote that "The findings, which are statistically significant, show that interviews conducted prior to final disposition (allowance or final rejection) of the application increase the probability that the subsequent action will be in full compliance with all applicable quality standards. The data shows that interviews help decrease both improper allowances and improper rejections by approximately 40 percent compared to applications without interviews prior to the final disposition." (Parentheses in original.)

1/15. The U.S. Court of Appeals (1stCir) issued its opinion in Latin American Music v. Media Power Group, a music copyright infringement case. The main issue was proof of ownership of copyrights. The plaintiff, Latin American Music, lost in the District Court as to all copyrights, either on summary judgment, or by jury verdict. The Court of Appeals affirmed the judgment of the District Court. This case is Latin American Music Co., Inc., et al.  v. Media Power Group Inc., et al., U.S. Court of Appeals for the 1st Circuit, App. Ct. No. 11-2108, an appeal from the U.S. District Court for the District of Puerto Rico. Judge Howard wrote the opinion of the Court of Appeals, in which Judges Torruella and Thompson joined.

People and Appointments

1/15. The National Telecommunications Cooperative Association (NTCA) appointed Don Richards of the law firm of Richards Elder & Green it chief counsel. See, NTCA release.

1/15. David Grim was named Deputy Director of the Securities and Exchange Commission's (SEC) Division of Investment Management. See, SEC release. Grim is a long time SEC employee.

1/15. Greg Berman was named Associate Director of the Securities and Exchange Commission's (SEC) Division of Trading and Markets' (DTM) Office of Analytics and Research. See, SEC release.

More News

1/15. IBM joined the Business Software Alliance (BSA). See, BSA release.

1/15. The Public Knowledge (PK), which often complains about data caps and network management practices of broadband internet access service providers, complained on January 15 about AT&T. It wrote in a release that "AT&T is using the data caps that it imposes on its home broadband subscribers to disadvantage competitors to AT&T Wireless." The PK elaborated that "The AT&T 3G MicroCell acts as a miniature cell tower that can be used to supplement and improve cell phone service for voice calls or data applications. However,  AT&T is exempting data from AT&T Wireless MicroCells from the data caps it imposes on its wireless home broadband users. This is similar to Comcast's decision last year to exempt its own online video service from its data cap."

1/15. The National Telecommunications and Information Administration (NTIA) released a discussion draft [5 pages in PDF] titled "Mobile App Voluntary Transparency Screens". The NTIA will host an on site and telecast meeting on this subject on Thursday, January 17 from 1:00 to 5:00 PM at the American Institute of Architects, 1735 New York Ave., NW. See, notice.

1/15. The Department of Homeland Security's (DHS) Customs and Border Protection (CBP) published a notice in the Federal Register (FR) that announces, describes, sets the comment deadline for, and sets the effective date of, the DHS/CBP's plan to establish a new system of records titled "U.S. Customs and Border Protection, DHS/CBP-004-Intellectual Property Rights e-Recordation and Search Systems System of Records". The deadline to submit comments is February 14, 2013. The effective date is also February 14. See, FR, Vol. 78, No. 10, January 15, 2013, at Pages 3015-3019.

1/15. The Federal Trade Commission (FTC) granted early termination on January 14, 2013 of the Hart Scott Rodino Act (HSR) waiting period for the transaction involving Oracle Corporation and Eloqua, Inc. See, January 15 FTC notice. Oracle stated in a December 20 release that Eloqua is a "provider of cloud-based marketing automation and revenue performance management software".

Obama Signs Patent, Economic Espionage and Intelligence Authorization Bills

1/14. President Obama signed three bills that contain technology related provisions. First, he signed HR 6621 [LOC | WW], an untitled bill that would make numerous non-controversial changes to patent law.

Rep. Lamar Smith (R-TX) introduced this bill on November 30, 2012. See, story titled "Rep. Smith Introduces Patent Bill" in TLJ Daily E-Mail Alert No. 2,487, December 10, 2012. The House passed this bill on December 18. See, story titled "House Passes Rep. Smith's Patent Bill" in TLJ Daily E-Mail Alert No. 4,494, December 19, 2012.

The Senate passed it on December 28, but deleted one controversial provision regarding pre-GATT patent applications. The Senate passed a substitute amendment offered by Sen. Patrick Leahy (D-VT) and Sen. Charles Grassley (R-IA). See, "Senate Amends and Passes Rep. Smith's Patent Bill" in TLJ Daily E-Mail Alert No. 2,499, December 30, 2012. The House then passed the Senate version on January 1, 2013. See, story titled "House Passes Smith Patent Bill" in TLJ Daily E-Mail Alert No. 2,501, January 1, 2013.

Second, President Obama signed HR 6029 [LOC | WW], the "Foreign and Economic Espionage Penalty Enhancement Act of 2012," a bill to increase the maximum fines.

Rep. Lamar Smith (R-TX), Rep. John Conyers (D-MI), and others introduced this bill on June 27, 2012. See, story titled "Representatives Introduce Bill to Increase Penalties for Economic Espionage" in TLJ Daily E-Mail Alert No. 2,405, July 9, 2012. The House passed this bill on August 1. See, story titled "House Passes Bill that Increases Penalties for Economic Espionage" in TLJ Daily E-Mail Alert No. 2,418, August 2, 2012.

The Senate amended and passed this bill on December 19, 2012. See, story titled "Senate Passes Economic Espionage Penalties Bill" in TLJ Daily E-Mail Alert No. 2,496, December 21, 2012. The House then passed this Senate version on January 1, 2013. See, story titled "House Passes Senate Version of Foreign and Economic Espionage Penalty Enhancement Act of 2012" in TLJ Daily E-Mail Alert No. 2,501, January 1, 2013.

Third, President Obama signed S 3454 [LOC | WW], the "Intelligence Authorization Act for Fiscal Year 2013". See, White House news office release.

Supreme Court Denies Cert in Case Involving Patent Settlement No-Challenge Clause

1/14. The Supreme Court denied certiorari in Rates Technology v. Speakeasy. See, Orders List [15 pages in PDF] at page 2. This lets stand the judgment of the U.S. Court of Appeals (2ndCir), which affirmed the judgment of the U.S. District Court (SDNY). The lower courts held void a patent settlement agreement no-challenge clause.

The issue is whether a clause in a settlement agreement which bars a patent licensee from later challenging the patent's validity is void for public policy reasons under the Supreme Court's 1969 opinion in Lear  v. Adkins, 395 U.S. 653, where the parties entered into the agreement after an accusation of infringement by the patent owner but prior to any litigation. The Court of Appeals held that the clause is void under Lear v. Adkins. See, July 10, 2012 opinion.

This case is Rates Technology, Inc. v. Speakeasy, Inc., et al., Sup. Ct. No. 12-402, a petition for writ of certiorari to the U.S. Court of Appeals for the 2nd Circuit, App. Ct. No. 11-4462. The Court of Appeals heard an appeal from the U.S. District Court for the Southern District of New York. See also, Supreme Court docket.

People and Appointments

1/14. Gene Kimmelman joined the American Antitrust Institute's (AAI) Advisory Board. See, AAI release. He recently worked for three years in the Obama Antitrust Division. Before that he worked for the Consumers Union. He has also worked for the Senate Judiciary Committee's (SJC) antitrust subcommittee, and for Public Citizen's Congress Watch.

1/14. The Ontario Superior Court of Justice issued its judgment in Her Majesty The Queen v. Frank Dunn, Douglas Beatty and Michael Gollogly, finding the three former Nortel executives not guilty of financial fraud.

More News

1/14. Facebook announced the launch of the beta version of a new functionality titled "Graph Search". Facebook stated in its release that this "is a new way for you to find people, photos, places and interests that are most relevant to you on Facebook". To what extent does this compete with Google search or Microsoft's Bing? Facebook wrote that "Graph Search and web search are very different. ... With Graph Search you ... get people, places, photos or other content that's been shared on Facebook. We believe they have very different uses." Facebook also made the assertion that "We've built Graph Search from the start with privacy in mind".

1/14. The U.S. District Court (SDNY) issued its opinion [58 pages in PDF] in Agence France Press v. Daniel Morel, a copyright infringement case involving copying photographs from social media sites. This case is Agence France Press v. Daniel Morel, U.S. District Court for the Southern District of New York, D.C. No. 1:10-cv-02730-AJN-MHD, Judge Alison Nathan presiding.

1/14. The Copyright Royalty Board (CRB) published a notice in the Federal Register (FR) that announces receipt from SoundExchange of a notice of intent to audit the 2009, 2010, and 2011 statements of account submitted by, Ltd., concerning the royalty payments made pursuant to two statutory licenses. See, FR, Vol. 78, No. 9, January 14, 2013, at Page 2694.

Aaron Schwartz Commits Suicide

1/11. Aaron Schwartz, a troubled young programmer who was facing criminal charges related to hacking and theft of academic articles, hung himself.

He held a deep disrespect for intellectual property rights in works that contain contributions to knowledge. He used his skills in programming, hacking, breaking and entering, and online distribution to make available millions of such works for free.

He stood apart from the most other prosecuted hackers and copyright infringers in several respects. For example, he focused on works that contributed to knowledge, such as scientific and academic journal articles and judicial opinions, rather than music, movies, games, and productivity software. Also, he did not seek to financially profit from his theft of other people's works.

One of his projects resulted in federal criminal charges -- theft and redistribution of 4.8 million JSTOR system articles.

JSTOR Criminal Case. On July 19, 2011, the U.S. District Court (DMass) unsealed an indictment [15 pages in PDF], returned by a grand jury on July 14, 2001, that charged Schwartz with unauthorized access to a protected computer system in violation of 18 U.S.C. § 1030, and wire fraud, in connection with his unauthorized accessing of the Massachusetts Institute of Technology's (MIT) computer systems to download digital copies of 4.8 million articles from academic journals in the JSTOR system.

The indictment stated that "JSTOR generally charges libraries, universities, and publishers a subscription fee for access to JSTOR's digitized journals" and does not permit users "to download or export content from its computer servers with automated computer programs such as web robots, spiders and scrapers".

The indictment detailed a long running effort by Schwartz, which began on September 24, 2010, and ended on January 6, 2011, to evade repeated countermeasures taken my MIT and JSTOR to block his downloading.

The indictment alleged that Schwartz, among other things, "contrived to ... break into a restricted computer wiring closet at MIT ... access MIT's network without authorization from a switch within that closet ... connect to JSTOR's archive of digitized journal articles through MIT's computer network ... use this access to download a major portion of JSTOR's archive onto his computers and computer hard drives ... avoid MIT's and JSTOR’s efforts to prevent this massive copying, measures which were directed at users generally and at Swartz’s illicit conduct specifically; and ... elude detection and identification".

He was not affiliated with MIT.

Carmen OrtizU.S. Attorney Carmen Ortiz (at right) stated at the time in a release that "Stealing is stealing whether you use a computer command or a crowbar, and whether you take documents, data or dollars. It is equally harmful to the victim whether you sell what you have stolen or give it away."

See also, story titled "Grand Jury Returns Indictment for Unauthorized Downloading of 4.8 Million JSTOR Articles" in TLJ Daily E-Mail Alert No. 2,264, July 20, 2011.

This case is U.S.A. v. Aaron Schwartz, U.S. District Court for the District of Massachusetts, D.C. No. 1:11-cr-10260-NMG.

Schwartz's Political Activities. Schwartz also campaigned against the Stop Online Piracy Act and PROTECT IP Act. See, HR 3261 [LOC | WW], the "Stop Online Piracy Act" or "SOPA", and S 968 [LOC | WW], the "Preventing Real Online Threats to Economic Creativity and Theft of Intellectual Property Act of 2011", "PROTECT IP Act", or "PIPA".

He gave a speech [22:52 minutes in YouTube] on May 21, 2012 titled "How We Stopped SOPA".

Schwartz also wrote a piece titled "Guerilla Open Access Manifesto" in 2008 in which he stated that "The world's entire scientific and cultural heritage, published over centuries in books and journals, is increasingly being digitized and locked up by a handful of private corporations."

"Large corporations, of course, are blinded by greed. The laws under which they operate require it -- their shareholders would revolt at anything less. And the politicians they have bought off back them, passing laws giving them the exclusive power to decide who can make copies."

"There is no justice in following unjust laws. It's time to come into the light and, in the grand tradition of civil disobedience, declare our opposition to this private theft of public culture." Schwartz continued that "We need to take information, wherever it is stored, make our copies and share them with the world. ... We need to buy secret databases and put them on the Web. We need to download scientific journals and upload them to file sharing networks. We need to fight for Guerilla Open Access."

Commentary on Section 1030. Section 1030 is a broadly and vaguely worded statute. It does enable the government to prosecute malicious hackers who deserve hard time in a federal penitentiary. However, it also enables abusive application in both private rights of action and criminal prosecutions.

Its flexibility enables lawyers in civil cases to manufacture diversity jurisdiction in some cases otherwise comprised entirely of state law claims. It has also been used by employers against former employees for normal computer and network uses. See, story titled "7th Circuit Applies Computer Hacking Statute to Use of Trace Removers on Employee Laptops" in TLJ Daily E-Mail Alert No. 1,326, March 9, 2006, and story titled "9th Circuit Construes Meaning of Without Authorization in Section 1030" in TLJ Daily E-Mail Alert No. 1,983, March 15, 2009.

In criminal cases, there is no consensus regarding just which cases lack merit. For example, some criticized the prosecutions of Schwartz or Lori Drew under Section 1030 as prosecutorial abuse. Others defended these prosecutors.

See, stories titled "Lori Drew Pleads Not Guilty in Section 1030 Case" in TLJ Daily E-Mail Alert No. 1,794, June 23, 2008, "Law Professors Argue for Dismissal of MySpace Section 1030 Prosecution" in TLJ Daily E-Mail Alert No. 1,810, August 11, 2008, and "Jury Returns Guilty Verdict in Lori Drew Case" in TLJ Daily E-Mail Alert No. 1,865, December 2, 2008.

See also, stories titled "Groups Urge Reform of Section 1030" in TLJ Daily E-Mail Alert No. 2,279, August 4, 2011, and "SECURE IT Act Addresses TOS Violations and Lori Drew" in TLJ Daily E-Mail Alert No. 2,367, April 10, 2012.

More Information. Schwartz was one of the developers of RSS. Later, he was one of the founders of Reddit, which Conde Nast acquired in late 2006. Schwartz left the company in 2007.

The U.S. Attorney, Ortiz, filed a Dismissal on January 14.

9th Circuit Addresses Filed Rate Doctrine

1/11. The U.S. Court of Appeals (9thCir) issued its amended opinion [62 pages in PDF] in Carlin v. Dairy America.

This case involves milk, which is regulated by the U.S. Department of Agriculture. However, the issue in this case is when the filed rate doctrine, which is also known as the filed tariff doctrine, applies, and if so, whether it bars certain state law causes of action. These issues also arise in some common carrier telecommunications cases.

The District Court held that the filed rate doctrine does apply to the USDA program at issue, and that it bars the plaintiff's state law claims. The Court of Appeals held that the filed rate doctrine applies, but that it does not operate as a bar to the state law causes of action. The amended opinion did not alter the original opinion of the majority.

This case is Gerald Carlin, et al. v. Dairy America, Inc., et al., U.S. Court of Appeals for the 9th Circuit, App. Ct. No. 10-16448, an appeal from the U.S. District Court for the Eastern District of California, D.C. No. 1:09-CV-00430, Judge Anthony Ishii presiding. Judge George Wu (USDC/CDCal sitting by designation) wrote the opinion of the Court of Appeals, in which Judge Johnnie Rawlinson joined. Judge Raymond Fisher wrote a concurring opinion; in the original opinion he joined with the majority.

People and Appointments

1/11. Sen. John Rockefeller (D-WVa) announced that he will not run for re-election in 2014. He is the Chairman of the Senate Commerce Committee (SCC). He issued a release in which he listed his major accomplishments, including "authoring the E-Rate program". He added that he "will use the next two years to secure the future of the E-Rate program ... to incorporate new technologies", and to "continue his work on Internet privacy and security -- from Do Not Track to data brokering to cyber security to cyber bullying". See also, statement by President Obama, and statement by FCC Chairman Julius Genachowski.

1/11. Joshua Wright was sworn in as Commission of the Federal Trade Commission (FTC). See, FTC release.

More News

1/11. The U.S. China Economic and Security Review Commission (USCESRC) released a staff report [6 pages in PDF] titled "The U.S. Balance of Trade with China". This report states that "the cumulative trade deficit with China through November 2012 was nearly $291 billion, more than $18 billion higher than a year ago". It adds that "computer and electronic products accounted for nearly half of all imports". It also states that "The Chinese government has yet to release the official GDP growth statistic for the final quarter of 2012. Nonetheless, on January 11, a prominent official at the National Development and Reform Commission (NDRC) suggested a growth rate of 7.7 percent."

1/11. The U.S. Court of Appeals (DCCir) issued its opinion in GameFly v. Postal Regulatory Commission, a petition for review of an order of the Postal Rate Commission (PRC) rejecting GameFly's allegation of discriminatory treatment. GameFly and Netflix both use the U.S. Postal Service (USPS) to mail DVDs to their customers. GameFly filed a discrimination complaint, because it is charged more than Netflix, and proposed remedies. The PRC rejected the complaint. The Court of Appeals vacated and remanded. This case is GameFly, Inc. v. PRC and USPS, intervenor, U.S. Court of Appeals for the District of Columbia Circuit, App. Ct. No. 11-1179, a petition for review of a final order of the PRC.

1/11. The U.S. Court of Appeals (7thCir) issued its opinion in Nationwide Insurance v. Central Laborers' Pension Fund, a case regarding an insurer's duty to defend and indemnify under a homeowner's insurance policy  in a data theft case. Central Laborers Pension Fund (CLPF) hired an accounting firm. CLPF gave to the firm a CD containing the names, birth dates, and Social Security Numbers of approximately 30,000 individual participants and beneficiaries in its funds. An employee of the firm, Jeanne Hentz, put the CD in her laptop, left the laptop in her car, and parked her car in front of her house, from which the laptop and CD were stolen. The CLPF filed a complaint in state court against the Hentz alleging negligence. She tendered the defense to her home insurer, Nationwide Insurance. Nationwide filed a complaint in the U.S. District Court (NDIll), based upon diversity of citizenship, against Hentz and CLPF seeking a declaratory judgment that the policy did not cover this incident, and hence, that it had no duty to defend or indemnify her. The District Court granted summary judgment to Nationwide. The Court of Appeals affirmed. This case is Nationwide Insurance Company v. Central Laborers' Pension Fund, et al., U.S. Court of Appeals for the 7th Circuit, App. Ct. No. 12-1784, an appeal from the U.S. District Court for the Southern District of Illinois, D.C. No. 11 CV 00618, Judge Phil Gilbert presiding. Judge Manion wrote the opinion of the Court of Appeals, in which Judges Williams and Hamilton joined.

Go to News from January 6-10, 2013.