| Rogan Announces USPTO FY
2003 Budget Proposal |
1/31. U.S. Patent and
Trademark Office (USPTO) Director James Rogan
announced that the administration's FY 2003 budget request for
the USPTO will be $1.365 Billion. He stated in a press
teleconference on January 31 that this is a 21.2% increase
over the FY 2002 appropriation, and that it will enable the
USPTO to hire more patent examiners, reduce patent pendency,
and improve patent quality.
Rogan stated that this will enable the USPTO to hire an
additional 950 patent examiners. Rogan noted that the average
pendency is now 25 months. "By hiring more examiners we
are hoping that it will help us with the backlog."
Nicholas Godici, the Commissioner for Patents, also
participated in the teleconference. He added that "with
this kind of hiring ... our projections are that we are going
to be able to act on 60,000 more patent applications than we
would have."
Rogan also said that the proposed budget would enable the
USPTO to complete the transformation of the trademark filing
system into a fully electronic operation by 2004.
The USPTO is entirely funded by user fees. However, for many
years, appropriations bills have diverted some of these fees
to fund other government programs. Opponents have argued that
this diversion leads to under funding of the USPTO, which in
turn delays the issuance of patents, and harms innovation and
the development of new technologies.
Rogan stated that "the administration is proposing a one
time surcharge" of $207 Million. "45 Million will be
budgeted for the USPTO's business plan" and $162 Million
will go for national security and homeland defense. Rogan
stated that "there will be a 19.3 percent proposed
surcharge for patents." Rogan reiterated that while this
is a one time surcharge, he can make no guarantees regarding
budget proposals in future years.
He also stated that the administration is proposing budget
increases of around 3% for agencies that are not related to
national defense or homeland security. Hence, the 21% proposed
increase for the USPTO reflects "an incredible investment
in the work at the Patent and Trademark Office."
Rogan will speak in Washington DC at a hearing on February 6
titled "Competition and Intellectual Property Law and
Policy in the Knowledge Based Economy". This hearing is
part of a series being hosted by the Federal Trade Commission (FTC)
and the Antitrust Division
of the Department of Justice (DOJ). |
|
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| FTC to Take Action Against
Spammers |
1/31. Howard Beales, Director of the FTC's Bureau of Consumer
Protection, spoke on "Privacy Regulation and the
Federal Trade Commission" at the 2nd Annual Privacy &
Data Security Summit sponsored by the International
Association of Privacy Officers. He also addressed
unsolicited e-mail.
He stated that "What we are planning to do, what we are
in the process of doing, actually, for the first time, is to
launch a systematic attack on spam that is itself fraudulent
and deceptive. And that is an enormous fraction of what we see
in our spam database. We have a database where you can forward
your spam if you like -- uce@ftc.gov.
We get about 10,000 pieces of spam a day."
He continued that "we are busy looking for cases. Some of
those cases will involve messages that are themselves
deceptive. We are also working on cases that involve claims
that you can opt out, when in fact what clicking on the link
to unsubscribe will do is simply verify that you have a valid
e-mail address, so that you can get lots of spam, instead of
just a little. Those cases take a little bit longer to
develop. But, we will be acting on that front, and you will
see the first set of cases very soon." |
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| USTR Zoellick Addresses
China, WTO and IT |
1/31. Robert Zoellick, the U.S.
Trade Representative (USTR), gave a speech
to the U.S. China Business Council in Washington DC in which
he discussed the PR China's accession to the WTO, and
information technology.
He stated that "China's 15-year long journey to attain
membership in the World Trade
Organization has been a modern long march, not to the
caves of the hinterland, but toward the seas of commerce and
the ports of new open doors." He added that "The
prospects for peace depend significantly -- but of course not
completely -- upon the maintenance and acceleration of China's
path in the last quarter century: toward openness to the
outside world and acceptance of international norms."
Zoellick also focused on information technology. He stated
that "The policies that have been at the core of China's
spectacular growth in the last twenty-five years -- progress
toward freer markets, greater openness to foreign competition
and investment, deregulation and privatization, tariff
reduction -- could serve as a model to others.
He continued: "Let me cite one example -- information
technology. China could have taken the route of East Asian
industrial policy, such as it experimented with through
automobiles in the mid-1990s, and tried to build up a domestic
industry behind high protectionist walls. Understanding the
global character of the emerging IT sector, China chose a
different course. It has joined the Information Technology
Agreement, agreeing to reduce its tariffs on all IT products
to zero by the year 2005."
"The result? Taiwanese companies, the IT powerhouses of
the region, have invested about $9 billion in assembly and
production plants on the Mainland. One quarter of the world's
desktop computers are already manufactured in China, and
one-half of the world's CD-ROMs. Within this decade, China
will become the world's largest supplier of IT hardware. It
will be the location of choice for IT assembly. It is becoming
a design and development partner, and will challenge Taiwan as
a semiconductor production center. It will soon be the second
largest market in the world for personal computers. This is a
spectacular example of how openness can lead to growth",
said Zoellick.
Zoellick also cautioned that "Japan's experience provides
a note of caution for China: If China tries to subvert the
free trade principles of the WTO by twisting them into
elements of a bureaucratic industrial policy, it will both
fail to derive the advantages of those principles and undercut
global WTO objectives. For example, it is critical for China
to understand that the benefits it has accrued from the zero
tariffs of the Information Technology Agreement will evaporate
if it attempts to distort the basic intent of the Agreement. I
have in mind provisions in China's new tariff schedule and
implementing regulations that would differentiate between
imports of IT products for domestic production and those
intended for domestic sale, with the latter being subject to a
tariff. We will make this point as often as necessary -- and
it will have to be made often -- to the Chinese." |
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| Cal App Holds for
Visa in Gambling Debts Case |
1/31. The Court
of Appeal of California (3) issued its opinion
[PDF] in Emery
v. Visa, holding that Visa cannot be held
liable under California consumer protection laws for the use
of Visa bank cards to pay illegal gambling debts.
Paul Emery filed a complaint in California Superior Court
against Visa International Service Association and Visa U.S.A.
Inc. alleging unfair and unlawful business practices and
deceptive advertising in connection with the use of VISA bank
cards to pay illegal gambling debts.
The trial court granted Visa's motion for summary judgment.
The Court of Appeal affirmed. It wrote that "This lawsuit
is misconceived legally and factually. As a so-called consumer
protection action, it lacks a defendant who has engaged in any
wrongful conduct and consumers who have been harmed. Because
plaintiff, a misguided private attorney general, has failed to
identify any triable issues of fact and bases his lawsuit on
mistaken legal concepts of expansive civil and criminal
liability where none exists, we affirm."
The Court of Appeal reasoned that "VISA does not approve
merchants, does not endorse their activities, does not
authorize any particular merchant transactions, and has no say
whatsoever in how the merchants operate their day to day
businesses. Indeed, the unrefuted evidence shows that VISA has
no regular, direct dealings at all with any of the merchants.
VISA merely makes available a payment system to member
financial institutions, which merchants can use, and adjusts
credit transactions among those members."
The Court continued: "In essence, plaintiff ascribes
vicarious liability to VISA for its failure to police millions
of merchants who allow payment with a VISA bank card. While
such expansive responsibility may be plaintiff’s idea of
needed social policy, he fails to present evidence of any
viable theory of agency. In the absence of sufficient evidence
to raise a genuine triable issue of fact, his lawsuit fails,
along with his misguided notion of consumerism."
Editor's Note: See, HR 556,
the Unlawful Internet Gambling Funding Prohibition Act, which
was passed by the House Financial
Services Committee on October 31, 2001. The bill would
attempt to stem illegal Internet gambling by preventing the
use of credit cards, wire transfers, and other financial
instruments in connection with illegal Internet gambling. It
provides that "No person engaged in the business of
betting or wagering may knowingly accept, in connection with
the participation of another person in unlawful Internet
gambling (1) credit ... (including credit extended through the
use of a credit card); (2) an electronic funds transfer ... ;
(3) any check ...; or (4) the proceeds of any other form of
financial transaction as the Secretary may prescribe by
regulation ..." See also, TLJ
Daily E-Mail Alert No. 299, November 1, 2001. |
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| European Commission
Approves HP Compaq Merger |
1/31. The European Commission approved the merger of Hewlett Packard Company and Compaq Computer Company.
It stated in a release
that its "analysis focused on the combination of HP's and
Compaq's activities in the markets for personal computers
(PCs), servers, handheld products, storage solutions and
services. In addition, the Commission also assessed the impact
of the merger on HP's joint development of the Itanium processor
with Intel as well as the
importance of HP's increased opportunity for joint sales of
PCs and printers following the integration of Compaq's PC
products."
PC Market. It concluded that in the PC market "the
merged entity will continue to face strong competition in
Europe from a number of credible rivals including IBM, Dell and Fujitsu Siemens,
which together with the absence of significant barriers to
entry and the practice of non-exclusive contractual
relationships between retailers and manufacturers would
prevent the new HP from any attempt to raise prices
significantly."
Server Market. It concluded that in the server market
"the proposed transaction was not likely to raise
competitive issues. Indeed, while the servers market can be
broken down according to price bands into entry level servers,
mid-range and large servers, HP and Compaq are largely
complementary except in the entry level market segment where
the combined entity will have relatively high market shares.
However, the Commission's analysis of that segment confirmed
that the new HP would not be able to act independently from
either customers or competitors as a result of the combination
of series of elements among which the dynamic and growing
nature of the market, the absence of entry barriers and the
presence of several strong competitors as well a series of
fringe suppliers, not to mention the white brands built around
Intel processors."
Itanium. In addition, "As to the potential impact
of HP and Intel's jointly developed Itanium processor, the
Commission's analysis concluded that the merged entity would
not be able to foreclose competitors' access to this component
and that it was in HP and Intel's interest to guarantee
unrestricted access."
HP Ch/CEO Carly
Fiorina said that this "announcement confirms that
the deal does not raise competition concerns in Europe, and we
see it as an encouraging step in the continuing process of
satisfying regulators worldwide that this deal will provide a
real stimulus for competition in information technology
markets." See, HP
release.
The deal still requires the approval of the Federal Trade Commission (FTC),
and shareholders. The FTC is not likely to raise objections. |
|
|
| FCC Commissioner Abernathy
Addresses Regulation, 3G, IP Telephony, and Trade |
1/31. FCC Commissioner Kathleen
Abernathy spoke at a luncheon hosted by the Federal Communications Bar
Association's International Practice Committee at the FCC
offices in Washington DC.
She stated that there are five key principles to her
regulatory philosophy: (1) Congress, through the
Communications Act, defines the agenda of the FCC, (2) the FCC
should rely upon competitive markets whenever possible, (3)
the FCC should write clear rules, with clear definitions, and
then enforce these rules, (4) the FCC should be humble about
what it can know, and (5) the FCC is a service based
organization that should act promptly.
She stated that both domestically, and internationally, there
are five areas where markets do not function efficiently, and
hence, there is a role for regulators: (1) interconnection,
(2) resale obligations, (3) colocation, (4) rights of way, and
(5) non discriminatory access to critical facilities.
IP Telephony. Abernathy was asked about promoting
Internet protocol telephony. She stated that "IP
telephony is not necessarily ready for prime time in the
U.S." She also noted that some engineers say that it is
vastly superior to analog, and that the FCC has increased its
hiring of engineers in this area.
3G Spectrum. Abernathy was also asked about what the
FCC is doing to make more spectrum available for Third
Generation (3G) wireless services, which are intended to bring
broadband Internet access to portable devices. She responded
that "we have less spectrum than any other country in the
world to assign to new technologies." She added that
"we have more spectrum devoted to defense" than any
other country, and that much spectrum is devoted to broadcast.
"There is a need for increased spectrum for
wireless," said Abernathy. "It is incumbent upon us
.. to figure out how we get it ... and how we balance 3G needs
with defense needs and public safety needs." She
concluded by saying that "we are in that process as we
speak."
She did not address any specific spectrum bands under
consideration for potential reallocation. Nor did she mention
the creation of secondary markets in spectrum rights.
Trade. Abernathy was also asked about the U.S. Trade Representative (USTR)
and telecom competition. February 1 is the extended deadline
for filing comments with the USTR regarding the operation and
effectiveness of the World Trade
Organization (WTO) Basic Telecommunications Agreement, the
telecommunications provisions of the North American Free Trade
Agreement (NAFTA), and other telecommunications trade
agreements. See, supplemental
notice in Federal Register.
Abernathy stated that "we cannot apply the trade pressure
that other entities in the U.S. can." She said that the
FCC can engage in dialogue with other nations, and can work
with the USTR on an "information sharing basis."
However, "at the end of the day, they are the ones making
the trades." |
|
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| FCC Comments on FTC's
Proposed Changes to Telemarketing Sales Rule |
1/31. Dane Snowden, Chief of the FCC's Consumer Information Bureau,
commented in a release
on the FTC's proposal to change
the Telemarketing Sales Rule (TSR). He stated that "We at
the Federal Communications Commission share the Federal Trade
Commission's commitment to ensuring that consumers' concerns
are addressed by telemarketing rules. We will be following
closely the progress of the FTC's recent proposal to create a
national do-not-call registry to help consumers in their
interactions with telemarketers."
On January 22, the FTC announced that it is proposing numerous
changes to its TSR. The proposals include the creation of a
national "do not call" registry, and a prohibition
on blocking caller ID systems by telemarketers. In addition,
the proposed rule contains several Internet related items.
The TSR, which is codified 16 CFR Part 310, implements the
1994 Telemarketing Consumer Fraud and Abuse Prevention Act, 15
U.S.C. §§ 6101-6108. The TSR prohibits specific
deceptive and abusive telemarketing acts or practices,
requires disclosure of certain material information, requires
express verifiable authorization for certain payment
mechanisms, sets record keeping requirements, and specifies
those transactions that are exempt from the TSR. The proposed
ruled is contained in an FTC notice
[150 pages in PDF]. |
|
|
| People and Appointments |
1/31. Microsoft named Scott Charney as its chief
security strategist, effective April 1. Charney is currently a
principal for Price
Waterhouse Coopers' Cybercrime Prevention and Response
Practice. From 1991 through 1999 he was chief of the Computer
Crime and Intellectual Property Section (CCIPS) of the
Criminal Division of the Department of Justice. See, MSFT
release.
1/31. President Bush named Jay Lefkowitz Deputy
Assistant to the President and Director of the Domestic Policy
Council. Lefkowitz has been General Counsel at the Office of Management and
Budget since March 2001. Before that, he was a partner in
the Washington DC office of the law firm of Kirkland & Ellis. He
also worked for the elder George Bush from 1991 to 1993. See, WH
release.
1/31. Tim Caruso was named Deputy Executive Assistant
Director of the FBI for Counterintelligence and
Counterterrorism. Pat D'Amuro was named Assistant
Director of the FBI for Counterterrorism. See, FBI release
and biographies
of Caruso and D'Amuro. |
|
|
| More News |
1/31. The Copyright
Office published a notice
in the Federal Register announcing that it is further
extending the time period for filing additional comments in
response to its March 9, 2001, Notice
of Inquiry concerning the interpretation and application
of the copyright laws to certain kinds of digital
transmissions of prerecorded musical works in light of an
agreement between the Recording
Industry Association of America (RIAA), the National Music Publishers
Association (NMPA), and The Harry Fox Agency (HFA). See, 17 U.S.C.
§ 115. Comments are due by February 6, 2002. Reply
comments are due February 27, 2002. See, Federal Register,
January 31, 2002, Vol. 67, No. 21, at Pages 4694 - 4695. This
is Docket No. RM 2000-7B.
1/31. The U.S.
Court of Appeals (9thCir) issued its opinion
[PDF] in Gardner
v. Nike, a case regarding the assignability of
exclusive licenses under the Copyright Act. Affirmed.
1/30. The Office of the U.S.
Trade Representative (USTR) announced that on January 30
"the United States and Hungary signed an agreement in
Budapest in which Hungary agreed to reduce or suspend its
tariffs on $180 million worth of key U.S. agricultural and
industrial exports annually, starting in April 2002." The
agreement covers, among other things, automatic data
processing machines, office machine parts, laser disks, and
telephone equipment. See, USTR
release. |
|
|
|
| Friday, Feb 1 |
The House will meet at 10:00 AM in pro forma session only.
Day three of the 2nd Annual Privacy & Data Security
Summit, sponsored by the International
Association of Privacy Officers. See, online
brochure [PDF]. Location: Hyatt Regency, 400 New Jersey
Ave., NW.
12:30 PM. The FCBA will
host a luncheon. The speaker will be FCC Commissioner Kevin Martin.
There will be a reception at 12:00 NOON. The price to attend
is $45 for FCBA members, $35 for government and law student
members, and $55 for non-members. Registrations and
cancellations due by 5:00 PM on Tuesday, January 29. To
register, contact Wendy Parish at wendy@fcba.org. Location:
Capital Hilton Hotel, 16th & K Streets NW.
12:30 - 2:00 PM. Harold Furchtgott
Roth will give a speech titled "A Tough Act to
Follow: The Telecommunications Act of 1996". To register,
contact Linzey Powers at lpowers
@aei.org. Location: American
Enterprise Institute, 12th floor, 1150 17th St., NW.
Deadline to submit comments to the Federal Election Commission (FEC)
in response to its requests comments on the second draft of
the revisions to the 1990 national voluntary performance
standards for computerized voting systems and the first draft
of the revisions to the 1990 national test standards. See, notice
in Federal Register, December 20, 2001, Vol. 66, No. 245, at
Pages 65708 - 65710.
12:00 NOON. Extended deadline to submit comments to the Office
of the United States Trade
Representative (USTR) regarding the operation and
effectiveness of the World Trade
Organization (WTO) Basic Telecommunications Agreement, the
telecommunications provisions of the North American Free Trade
Agreement (NAFTA), and other telecommunications trade
agreements. This request for comments is pursuant to an annual
review of telecom agreements required by Section 1377. The
original notice
(Federal Register, December 27, 2001, Vol. 66, No. 248, at
Pages 66963 - 66964) set January 28 as the deadline. A supplemental
notice (Federal Register, January 29, 2002, Vol. 67, No.
19, at Pages 4305 - 4306) extended the deadline to February 1. |
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| Monday, Feb 4 |
9:00 AM. The Cato Institute
will release a study titled "The Digital Dirty
Dozen" which lists and evaluates the worst high tech
legislative proposals of this Congress. The speakers will be Wayne Crews
and Adam
Thierer. This study will be released at an invitation only
press breakfast. For more information, contact Jerry Brito at
202-218-4621. Location: Cato, 1000 Mass. Ave., NW.
10:00 AM. The U.S. Court of
Appeals (FedCir) will hear oral argument in Telecom
Technical Services v. Siemens Rolm. Plaintiffs sued
Seimens Rolm alleging violation of federal antitrust laws;
they alleged monopolization of alleged markets for
telecommunications equipment; they also sought class action
status. Seimens asserted various counterclaims, including
patent infringement. The U.S.
District Court (NDGa) denied class action status. (This is
Appeals Court No. 01-5090 and D.C. No. 95-CV-549-WBH.)
Location: Courtroom 201, 717 Madison Place, NW.
10:00 AM. The House
Judiciary Committee will hold a hearing on HR 2341,
the Class Action Fairness Act of 2001, sponsored by Rep. Bob Goodlatte
(R-VA). Location: Room 2141, Rayburn Building.
Deadline to submit petitions and comments to the FCC's Cable Services Bureau
regarding the applications of Hughes Electronics Corporation
and EchoStar Communications Corporation to the FCC requesting
consent to the transfer of control of licenses and
authorizations involved in the EchoStar DirecTV merger. See,
FCC notice
[MS Word]. Oppositions and responses are due by February 25,
2002. This is CS Docket No. 01-348. |
|
|
| Tuesday, Feb 5 |
9:30 AM. The U.S.
Court of Appeals (DCCir) will hear oral argument in EchoStar
v. FCC, No. 01-1032. Judges Ginsburg, Edwards and Sentelle
will preside.
RESCHEDULED FOR FEB 12. 12:15
PM. The FCBA's
Transactional Practice Brown Committee will host a brown bag
lunch on wireless transactions.
1:30 PM. The U.S. International Telecommunication Advisory
Committee (ITAC) will hold a meeting. See, notice
in Federal Register. Location: State Dept.
2:30 PM. The Senate
Finance Committee will hold a hearing to hear testimony on
the President's FY 2003 budget and tax proposals. Treasury
Secretary Paul O'Neill will testify. Location: Room
215, Dirksen Building.
4:00 PM. The Cato Institute
will host a book forum on Against
the Dead Hand: The Uncertain Struggle for Global Capitalism
[Amazon], by Brink
Lindsey (Cato Institute). The commenters will be Robert
Zoellick (U.S. Trade
Representative), Sebastian Mallaby (Washington Post), and
Douglas Irwin (Dartmouth). See, online
information and registration page. Location: The Cato
Institute, 1000 Massachusetts Ave., NW.
Deadline to submit applications to the NTIA
for planning and construction grants for public
telecommunications facilities under the Public
Telecommunications Facilities Program (PTFP) for FY 2002. See,
notice
in Federal Register. |
|
|
| Wednesday, Feb 6 |
10:00 AM. The Senate
Finance Committee will hold a hearing titled Ongoing
U.S. Trade Negotiations. The scheduled witnesses are
Robert Zoellick (USTR),
Gary Broyles (National Association of Wheatgrowers), George
Scalise (Semiconductor
Industry Association), and Arthur Wainwright (National Association of
Manufacturers). Location: Room 215, Dirksen Building.
10:00 AM - 12:00 NOON. The FCC's Advisory Committee for the
2003 World Radiocommunication Conference (WRC-03) will meet.
Location: FCC, 445 12th Street, SW, Room TWC305 (Commission
Meeting Room), Washington DC. This meeting had previously been
scheduled for January 30. See, FCC
notice of postponement [PDF].
12:15 PM. The FCBA's
Online Committee will host a brown bag lunch. RSVP to Scott
Harris at sharris
@harriswiltshire.com.
2:00 PM. The Federal Trade
Commission (FTC) and the Antitrust Division of the
Department of Justice (DOJ) will hold the first of a series of
joint hearings on antitrust and intellectual property.
The hearings are titled "Competition and Intellectual
Property Law and Policy in the Knowledge Based Economy".
The speakers at the opening hearing will be Timothy Muris (FTC
Chairman), Charles James (Assistant Attorney General for the
Antitrust Division), James Rogan (Director of the USPTO), Judge
Pauline Newman (U.S. Court of
Appeals for the Federal Circuit), Robert Pitofsky
(Professor at Georgetown University Law Center), Todd
Dickinson (Howrey Simon),
Gerald Mossinghoff (Oblon
Spivak), Richard Gilbert (Professor at U.C. Berkeley), and
Richard Levin (President of Yale). See, FTC
release and DOJ
release. Location: Room 432, FTC, 600 Pennsylvania Ave.,
NW.
Deadline to submit comments to the Federal Communications Commission
(FCC) regarding Verizon's
Section
271 application to provide in region interLATA services in
the state of Vermont. See, FCC
notice [PDF]. This is CC Docket No. 02-7. |
|
|
| Thursday, Feb 7 |
10:00 AM. The Senate
Judiciary Committee will hold an executive business
meeting. Location: Room 226, Dirksen Building.
12:30 PM. Tom Ridge, Director of the Office of Homeland
Security will speak at a luncheon. Location: Ballroom,
National Press Club, 529 14th St. NW, 13th Floor. |
|
|
| Computer Crimes |
1/31. The U.S.
Court of Appeals (3rdCir) issued its opinion
in USA
v. Moore, an appeal of a sentence imposed for
violation of 18
U.S.C. § 491. The defendant is a juvenile who
participated in a scheme to create counterfeit $20 bills at
home using a personal computer, scanner, printer and paper
cutter, and then pass them at a Six Flags theme park. He was
caught, plead guilty, and was sentenced to 12 months
imprisonment, one year of supervised release, and restitution
to Six Flags. He appealed the sentence. The Appeals Court
affirmed.
1/22. The Department of Justice's (DOJ's) Computer
Crimes and Intellectual Property Section (CCIPS) announced
two criminal copyright infringement actions involving an
Internet piracy group. The DOJ stated that defendant Kentaga
Kartadinata operated an electronic mail server for the group,
and defendant Mike Nguyen "managed several of the file
servers that contained thousands of pirated software titles,
including Windows operating systems and various utility
programs. The file servers also contained video games and DVD
movies, which were often made available to group members prior
to the commercial release at movie theaters." See, CCIPS
release. |
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