| Online Survey Shows
Decrease in Collection of Information by Web Sites |
3/27. The Progress and Freedom
Foundation (PFF) released a report
[92 pages in PDF] titled "Privacy Online: A Report on the
Information Practices and Policies of Commercial
Websites." It presents the results of a survey of web
sites similar in methodology to previous surveys conducted by
the Federal Trade Commission
(FTC). The report found that compared to the year 2000, when
the FTC last conducted a survey, web site operators are now
collecting less personally identifying information, fewer are
using third party cookies, and their privacy policies provide
more information and are more accessible.
Collection of Personally Identifying Information. The
PFF report found that "commercial Web sites are
collecting less information than they were two years ago.
Among the most popular domains, for example, the proportion
collecting Personally Identifying Information ("PII")
other than email fell from 96 percent to 84 percent; it fell
from 87 percent to 74 percent for sites in the Random
Sample."
3rd Party Cookies. The report also found that "the
use of third party cookies to track surfing behavior across
multiple Web sites, is also down significantly. The proportion
of Web sites that utilize third party cookies fell from 78
percent to 48 percent for the most popular group and from 57
percent to 25 percent for the Random Sample."
P3P. The report found that "Although P3P enabled
browsers were only available in late summer, and the adoption
of the standard is not yet final, one quarter of the most
popular domains and five percent of the random sample domains
have already implemented this technology.
Seal Programs. The report found that "Privacy seal
programs ... do not appear to be making major strides: the
proportion of random sample sites displaying seals increased
from eight percent to 12 percent, while the proportion in the
most popular group was essentially unchanged."
Sharing of Information. The report found that "the
percentage of the most popular sites that offer choice over
sharing consumer information with third parties -- a key
consumer concern -- jumped from 77 percent to 93
percent."
The FTC last issued a report
to Congress on online privacy on May 22, 2000. Its report was
titled "Privacy Online: Fair Information Practices in the
Electronic Marketplace: A Federal Trade Commission Report to
Congress." That report also recommended that Congress
pass legislation to empower the FTC to pass rules requiring
web sites to give notice of their information practices, to
allow individuals to control how their data is used, to allow
individuals to access and correct their data, and to require
security measures.
Jeffrey Eisenach, of the PFF, suggested "that the market
is responding to consumer concerns". However, he also
pointed out that the FTC conducted its survey in 2000 at the
peak of the technology boom, when companies tended to think
that a database of personally identifying information had more
value they they now believe that it does.
The report was written by William Adkinson, Jeffrey Eisenach,
and Thomas Lenard. Ernst & Young conducted the survey upon
which the report is based. |
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| FTC Officials Comment on
PFF Privacy ReportNews |
3/27. Several Federal Trade
Commission (FTC) officials spoke at the Progress and Freedom Foundation
(PFF) event to release its report
[PDF] titled "Privacy Online: A Report on the Information
Practices and Policies of Commercial Websites." Chairman
Timothy Muris, Commissioners Orson Swindle and Thomas Leary,
and Consumer Protection Bureau Director Howard Beales all
commended the report.
Muris stated that "these think tanks also are an
important source of data for developing public policy."
He said that he has yet to read the full results of the study,
but "from the preliminary results that I see, it appears
that there is continued progress towards the goal of
protecting consumer privacy. These are real results that
should have real benefits for consumers. These improvement are
both good news for consumers, and exactly the type of market
driven costs you would expect from a dynamic economy like
ours."
However, he said that "despite these gains, industry
should continue to improve". He also stated that "I
hope to see the gains documented in the survey translated into
marketing over privacy and information collection." Muris
also cautioned that "having made these promises, industry
must be sure they comply with them. Unfulfilled privacy
promises will remain a top priority at the FTC."
FTC Bureau of Consumer Protection Director Howard Beales
called the PFF report a "valuable perspective." He
continued that "I think it is really kind of interesting
to think about what you found here in the online world,
compared to what we are seeing in the offline world of
financial privacy notices. We still only have one round of
Gramm Leach Bliley notices. But, round two is beginning. And,
what we are looking at, in a sense, is a market driven privacy
notice policy in the online world, and a regulation driven
privacy policy approach in the offline world of financial
privacy."
"It is online versus offline, and that may make some
difference. Notice is somewhat easier. But, it will be very
interesting to see whether in fact there is comparable levels
of change in the notices and the privacy practices that we see
in the financial sector, where it is regulated, rather than
market," said Beales.
He also said that "we are seeing trends that are
encouraging. But what is making the most encouraging thing
about them, and again, we are seeing this a little offline as
well, is what they indicate is that marketing based on privacy
to try to convey information to consumers about what privacy
practices really are. And if notices, whether online or
offline are going to have a real impact, that is where it is
going to have to come from, is from marketing based on what
that notice has to say".
FCC Commissioner Orson Swindle said that "industry is
competing with its competition based on good privacy
practices." FCC Commissioner Thomas Leary stated that
"I am content with our current posture ... we are in the
mode now of retreating somewhat from telling law makers
what they ought to do."
Commissioners Swindle and Leary dissented from the FTC's
recommendation in 2000 that Congress pass legislation to
regulate online privacy. Commissioners Mozelle Thompson and
Sheila Anthony, who were in the majority in 2000, did not
speak at the PFF event on March 27. |
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| Kolasky Addresses
International Antitrust |
3/22. William Kolasky, a Deputy Assistant Attorney General
in the Antitrust Division
of the Department of Justice, gave a speech
titled "International Convergence Efforts: A U.S.
Perspective" to the International Dimensions of
Competition Law Conference in Toronto, Canada.
He discussed the International Competition Network (ICN), a
framework for interaction and cooperation among government
officials, private firms and non-governmental organizations
that was begun last October.
He also addressed the relationship between the EU and the US.
He stated that "In merger review and cartel enforcement,
Washington and Brussels have, over the years, developed an
excellent working relationship. This relationship has helped
foster a considerable degree of substantive convergence,
especially in how we define markets and how we evaluate the
likely competitive effects of horizontal mergers. As a result,
we have tended to reach similar conclusions on matters when we
become fully engaged with one another on the analysis and we
are working from a common set of facts." He added that
"until last year in the GE/Honeywell case,
neither of us had prohibited a merger over the other's
objection."
He stated that "As cross border trade and investment
grows, and as markets become increasingly global, there is
real value in seeking to have competition authorities
worldwide develop a common approach to common problems."
He advocated the adoption of six principles: "Protect
competition, not competitors. Recognize central role of
efficiencies in antitrust analysis. Base decisions on sound
economics and hard evidence. Acknowledge the limits to our
predictive capabilities. Be flexible and forward looking.
Impose no unnecessary bureaucratic costs."
He concluded that "one thing we have learned in the wake
of GE/Honeywell is that ... there is a considerable gap in how
we understand and apply these principles in practice, not just
on mergers, but in the nonmerger area as well. We have, for
example, identified at least five key areas where the EC
approach seems to be significantly different from our
approach: treatment of efficiencies, predatory pricing,
fidelity rebates and bundled discounts, essential facilities,
and monopoly leveraging." |
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| FTC Official Addresses Spam
and Online Fraud |
3/27. Howard Beales, Director of the Federal Trade Commission's
Bureau of Consumer Protection, spoke at a Cato Institute panel
discussion on spam. He addressed the FTC's recent actions, and
views, related to spam and online fraud.
Fraudulent and Deceptive E-Mail. He stated that the FTC
is bringing civil enforcement actions where the e-mail itself
is fraudulent and deceptive. He said that "As we surveyed
the landscape on privacy, and tried to figure out what areas
and what actions were most appropriate for the Federal Trade
Commission, we focused most heavily on consequences. And one
of the consequences of invasions of privacy is simply annoying
intrusions -- the telemarketing call at dinner is one example,
and unwanted spam is clearly another. In trying to think of
what is the FTC's role in addressing that particular problem,
we decided that we should focus on the cases that involve spam
that is itself worthless. It doesn't raise any of the
difficulties that legislation or regulatory proposals may
raise. We are looking at spam where the message itself is
fraudulent and deceptive."
He continued that "In those kinds of cases, it is fairly
clear that nobody would like to get that kind of spam. It is
fairly clear that it is illegal to send that kind of spam in
the first place. But, there has never been any systematic
attempt to go after it, until this program. The Commission has
had in place for years a spam database. We are actually
probably the only people in town who want spam. ... We use
that flow to look for cases where the spam itself is
deceptive, where the message itself has no value to anybody,
as best we can tell, and to bring prosecutions in those
cases."
Beales reviewed several cases recently brought by the FTC, and
touched on some cases yet to be filed. For example, he said
that "there are others that are in the pipeline that will
be announced very shortly. ... One case involves a product
very attractive to teen age boys. The spam says ``get one of
these free by clicking here´´. Four clicks latter, and you
are on a pormo site. And it isn't free."
Removal from Spam Lists. Beales also stated that the
FTC is currently studying claims by some spammers regarding
removal from their spam lists. "We have also been very
interested in looking at removal claims. One of the solutions
for consumers, in some ways, is to ask to unsubscribe to lists
that are out there. But, there is this myth, or report -- we
don't know if it is a myth -- that is what we are trying to
find out -- that if you click on ``remove me´´ or
``unsubscribe´´ what you actually do is confirm that the
spammer has a valid email address, and that rather than being
removed, what you get is more spam. Well, we went through a
process of setting up ... hundreds of e-mail accounts ... to
see what we get, and then unsubscribing to whatever we got,
and seeing what happened. And we will have the results of that
to announce fairly shortly. But, claims to remove me, when in
fact either you don't get removed, or when in fact you get
more spam, are very clearly deceptive. There is no question
about that. And, cases that we would very much like to
bring."
Spamming Tools. Beales also stated that "we are
looking at cases that involve the sale of the tools of the
spamming trade, if you will, involving bulk spammers -- people
who sell e-mail lists with deceptive claims about how much
everybody on that list would really like to get email from
you, or that sell software to automate the process of sending
spam with deceptive claims. But, we are looking at sort of the
tools of the spamming trade, and trying to interrupt the
commerce there, wherein that commerce is dependent on a
deceptive claim."
Domain Blacklisting. Beales was asked about the FTC's
views on blacklisting, or blocking, of e-mail domains. He
responded that the FTC has no concerns about blacklists,
unless someone is marketing such a list, and making fraudulent
statements about the list.
Spam Related Legislative Proposals. Beales was also
asked about legislative proposals that address spam. He said
that one problem with legislating e-mail standards is that the
fraudsters would not comply with the legislative requirements.
He said that "The biggest part of the spam problem in
terms of the consequences it creates is the fraudsters. And,
sadly, our experience is that this is a group of people that
is pretty poor about playing by the rules. That leads -- a
large chunk of the problem, that in many ways is the most
objectionable chunk of the problem, unaffected because they
simply won't comply. Partly, that is what we are trying to do,
is to figure out whether we could enforce, whether it's that,
or the underlying fraud prohibition in the first place. And I
guess the second part of that problem is what we have seen
about ``remove me´´ of people thinking they can't click
because if they do, they will get more spam. I don't know that
the legislative solution of the required ``remove me´´
really would address that."
The other speakers at the event were Rebecca Richards (TRUSTe),
Chris Hoofnagle (Electronic
Privacy Information Center), and Jerry Cerasale (Direct
Marketing Association). Wayne Crew (Cato) moderated. |
|
|
| Campaign Act Challenged in
Court |
3/27. President Bush signed HR
2356, the "Bipartisan Campaign Reform Act of
2002" (BCRA), in Washington DC. He then flew to South
Carolina and Georgia to raise money for Republican Senate
candidates. See, White
House release.
Later in the day, Sen.
Mitch McConnell (R-KY) filed a complaint
in U.S. District Court
(DC) against the Federal
Election Commission (FEC) and the Federal Communications Commission
(FCC) challenging the constitutionality of the act. See, McConnell
release.
The complaint states that "The BCRA limits and
criminalizes speech and related activities touching on the
widest range of public issues. In doing so, it dramatically
extends the scope of the Federal Election Campaign Act of 1971
(FECA) and the Federal Communications Act of 1934 (FCA) in a
manner that violates several provisions of the
Constitution."
The complaint continues that "Central to the BCRA is its
effort to regulate core political speech. When such speech,
long and correctly viewed as entitled to the highest degree of
First Amendment protection, is broadcast in the form of an
issue advertisement on television or radio and merely mentions
a federal officeholder or candidate in the months leading up
to an election, it can be a crime, with penalties of up to
five years in prison. If the BCRA had been in effect in 2000,
criminal punishments could have been meted out simply for the
sponsorship of ads urging a Member of Congress to vote yes or
no on pending proposals to ... regulate speech on the Internet
... Not since the Alien and Sedition Acts, enacted in the
earliest days of our Republic, could criminal sanctions be so
easily incurred simply by engaging in such core political
speech."
The attorneys who signed the complaint are Ken Starr (Kirkland
& Ellis), Floyd Abrams (Cahill
Gordon & Reindel), Kathleen
Sullivan (Dean of the Stanford University Law
School), Jan Baran (Wiley
Rein & Fielding), and James Bopp (Bopp Coleson &
Bostrom). |
|
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| Bush Addresses Selection of
Judges |
3/27. President Bush gave a speech
at a fundraising dinner in Atlanta, Georgia, for Rep. Saxby Chambliss
(R-GA), who is running against Sen. Max Cleland (D-GA)
for the Senate. One of the topics that President Bush
addressed was judicial selection.
He stated that "There is no more fundamental issue than
to making sure we have a judiciary of people that do not
interpret the law from the bench; people who do not try to
write law from the bench. People who interpret the law and not
try to write it. And I put up a good man from Mississippi the
other day. And I don't remember the senior senator from
Georgia defending this man's honor. And we're going to have
more fights when it comes to the judiciary. And I'm going to
put strict constructionists on the bench. And I expect people
in the United States Senate from a great state like Georgia to
do what Zell Miller did, and stood up and defended the honor
and integrity of Judge Pickering. And that's what Saxby
Chambliss is going to do." |
|
|
| People and Appointments |
| 3/27. Paul Jackson was named Deputy Director of the Federal Communications Commission's
(FCC) Office of Legislative Affairs (OLA). He has been Acting
Director and Acting Deputy Director of the Office of
Legislative and Intergovernmental Affairs. Jackson has worked
for Michael Powell since 1997. Before that, he worked in the
Washington DC office of the law firm of O'Melveny & Myers.
See, FCC
release. |
|
|
|
| FCC Refunds Down Payments
Made by NextWave Spectrum Reauction Winners |
3/27. The Federal
Communications Commission (FCC) issued an Order
[PDF] in which it announced that it will refund a substantial
portion of the down payments made by winning bidders in
Auction No. 35 for licenses previously issued to NextWave and
Urban Comm. See also, FCC
release.
The 15 page order states that "This Order grants in part,
and denies in part, a Joint Request for refund of down
payments made by certain winning bidders
("Petitioners") in Auction No. 35. Petitioners seek
a full refund of the down payments made for spectrum
associated with licenses that had previously been issued to
NextWave Personal Communications Inc., NextWave Power Partners
Inc. (collectively "NextWave") and Urban Comm-North
Carolina, Inc. ("Urban Comm")."
The order continues that the FCC "will refund to the
payors of record a substantial portion of the monies on
deposit for spectrum formerly licensed to NextWave and Urban
Comm, but will retain an amount equal to three percent of the
net winning bids for these licenses."
The order also states that the FCC "will maintain the
pending status of the applications for these licenses. As
discussed below, neither the Commission's determination to
refund, in part, certain deposits nor the continued litigation
associated with particular licenses relieves winning bidders
of the obligation to pay their full bid amounts for licenses
won in Auction No. 35. Should the Commission prevail in its
ongoing litigation with NextWave, winning bidders in the
auction will be required to either pay their full bid amounts
or be subject to default payments."
NextWave obtained spectrum licenses at FCC auctions in 1996.
The FCC permitted NextWave to obtain the licenses, and make
payments under an installment plan, thus creating a debtor
creditor relationship between NextWave and the FCC. NextWave
did not make payments required by the plan, and filed a
Chapter 11 bankruptcy petition. The FCC cancelled the
licenses. It then proceeding to re-auction the disputed
spectrum. The U.S.
Court of Appeals (DCCir) ruled in its June 22, 2001, opinion
that the FCC is prevented from canceling the spectrum licenses
by § 525
of the Bankruptcy Code. The Supreme Court has granted the
FCC's petition for writ of certiorari. |
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| Thursday, March 28 |
Passover begins.
The House and Senate are both in recess for the Spring
District Work Period. Both bodies will return on Monday, April
8.
12:15 PM. The FCBA's
Young Lawyers Committee will host a brown bag luncheon. The
topic will be "Putting the ``Mass´´ Back in Media -- A
First Amendment Right to Bulk Up." The speaker will be Paul
Gallant, Special Advisor to Kenneth Ferree, Bureau Chief
of the Cable Services Bureau, and a member of the Media
Ownership Working Group. RSVP to rwallach @willkie.com.
Location: Willkie Farr &
Gallagher, 1155 21st Street, NW (between L & M), 6th
Floor.
4:00 PM. John
Duffy (Marshall Wythe School of Law) will give a lecture
titled "The Puzzling Persistence of the Ideal of Marginal
Cost Pricing in the Economic Analysis of Patents". For
more information, contact Robert Brauneis at rbraun @main.nlc.gwu.edu
or 202 994-6138. Location: George Washington University Law
School, 2000 H Street, NW.
Deadline to submit comments to the FCC regarding
ways to improve its electronic licensing systems. See, FCC
notice [PDF]. |
|
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| Friday, March 29 |
Good Friday.
The Library of Congress's THOMAS
web site will be unavailable from 6:00 AM to 1:00 PM due
to system testing.
Extended deadline to submit public comments to the FTC
regarding the use of disgorgement as a remedy for competition
violations, including those involving the Hart Scott Rodino
(HSR) Premerger Notification Act, FTC Act, and Clayton Act.
See, original FTC release
and Federal Register notice,
and FTC release
and Federal Register notice
extending deadline from March 1 to March 29.
Deadline to submit comments to the FTC
regarding proposed new Privacy Act system of records. This
system, if adopted, would include telephone numbers and other
information pertaining to individuals who have informed the
Commission that they do not wish to receive telemarketing
calls. See, notice
to be published in the Federal Register. |
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| Monday, April 1 |
The Supreme Court of the U.S. will go on recess until
Monday, April 15.
The USTR will
hold a hearing regarding negotiation of a U.S. Singapore
Free Trade Agreement. The USTR stated in its notice
in the Federal Register that the agreement is "expected
to include provisions on trade in services, investment, trade
related aspects of intellectual property rights, competition,
government procurement, electronic commerce, trade related
environmental and labor matters, and other issues." See,
Federal Register, Vol. 67, No. 40, at pages 9349 - 9351.
10:00 AM. The U.S.
Court of Appeals (FedCir) will hear oral argument in Philip
Jackson v. Casio PhoneMate, No. 01-1456, a patent
infringement case involving telephone answering machines. The
U.S. District Court (NDIll) granted summary judgment to Casio.
Location: Courtroom 201, LaFayette Square, 717 Madison Place,
NW.
EXTENDED TO APRIL 22. Deadline
to file reply comments with the FCC in response
to its notice of proposed rulemaking (NPRM) regarding the
appropriate regulatory requirements for incumbent local
exchange carriers' (ILECs') provision of broadband
telecommunications services. The FCC adopted this NPRM at its
December 12 meeting. This is CC Docket No. 01-337. See, notice
in the Federal Register. See, Order
[PDF] extending deadline to April 22.
Deadline to submit written requests to participate as a
panelist in the workshop to be hosted by the FTC
on May 16 and 17 to explore issues relating to the security of
consumers' computers and the personal information stored in
them or in company databases. See, notice
in Federal Register. |
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| Tuesday, April 2 |
| 10:00 AM. The U.S.
Court of Appeals (FedCir) will hear oral argument in Netscape
Communications v. Allen Konrad, No. 01-1455. Location:
Courtroom 201, LaFayette Square, 717 Madison Place, NW. |
|
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| Wednesday, April 3 |
| 12:15 PM. The FCBA's
International Practice Committee will host a brown bag lunch.
The speakers will be Tom Tycz (Chief of the FCC's
International Bureau's Satellite Division), James Ball
(Chief of the FCC's International Bureau's Policy Division),
and Kathryn O'Brien (Chief of the FCC's International
Bureau's Strategic Analysis and Negotiations Division). RSVP
to Laurie Sherman at 202 223-7365 or Patricia Paoletta at 202
719-7532. Location: FCC, 445 12th Street, SW, Conference Room
6-B516. |
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