7/22. The House began its consideration of HR 2799, the "Commerce, Justice, State, and the Judiciary Appropriations, 2004", the CJS bill. The House is likely to pass the bill on Wednesday, July 23. The bill has become a vehicle for addressing the Federal Communications Commission's (FCC) recently announced changes to its media ownership rules.

This bill contains appropriations for most of the technology related executive branch entities. See, story titled "House to Consider CJS Appropriation Bill" in TLJ Daily E-Mail Alert No. 703, July 22, 2003, for a summary of the funding levels of the various technology related entities covered by the bill.

However, most of the debate on July 22 focused on policy, rather than funding levels. Some of the policies debates pertain to rules of the FCC. The House rejected an amendment that would have limited funding for the FCC to implement it recently announced changes to its media ownership rules. However, backers of the FCC's rules changes offered no amendment to remove the item that was added to the bill by the House Appropriations Committee (HAC) that prohibits the use of funds to grant licenses for a commercial TV broadcast station if the granting of that license would result in such party having an aggregate national audience reach exceeding 35%. The House removed, on points of order, two items in the bill that prohibit any FCC or Federal Trade Commission (FTC) employees from accepting payment of travel expenses from non federal entities to attend conventions.

Media Ownership Rules. The HAC, which approved the CJS appropriations bill on July 16, added an amendment that prohibits the use of funds to grant licenses for a commercial TV broadcast station if the granting of that license would result in such party having an aggregate national audience reach exceeding 35%.

The bill provides, at Section 624, that "None of the funds in this Act may be used to grant, transfer or assign a license for a commercial TV broadcast station to any party (including all parties under common control) if the grant, transfer or assignment of such license would result in such party or any of its stockholders, partners, members, officers or directors, directly or indirectly, owning, operating or controlling, or having a cognizable interest in TV stations which have an aggregate national audience reach, as defined in 47 C.F.R. 73.3555, exceeding thirty-five (35) percent." (Parentheses in original.)

This amendment would have the effect of preventing the FCC from fully implementing, during FY 2004, the national TV ownership provisions of its June 2, 2003 Report and Order and Notice of Proposed Rulemaking [257 pages in PDF] amending its media ownership rules. See, story titled "FCC Announces Revisions to Media Ownership Rules" in TLJ Daily E-Mail Alert No. 672, June 3, 2003.

Opponents of this provision did not offer any amendments on the House floor to remove it. Opponents could still seek to have the amendment removed by the conference committee that reconciles the differences between the House and Senate versions of the bill. Alternatively, President Bush could veto the bill.

However, Rep. Maurice Hinchey (R-NY) offered an amendment that prohibits the use of funds to grant, transfer or assign certain broadcast licenses, unless certain ownership conditions are met.

The amendment would have the effect of preventing the FCC from fully implementing, during FY 2004, the newspaper broadcast cross ownership and local TV multiple ownership rule provisions of its Report and Order and Notice of Proposed Rulemaking [257 pages in PDF] amending its media ownership rules.

It failed by a vote of 174-254. See, Roll Call No. 407. The vote correlated with party affiliation. 34 Republicans voted for the amendment, and 194 voted against. 139 Democrats voted for the amendment, and 60 voted against.

Points of Order Regarding FCC & FTC Travel Expenses. Rep. Fred Upton (R-MI), the Chairman of the House Commerce Committee's Subcommittee on Telecommunications and the Internet, raised two points of order against two provisions in the bill. First, he objected to the provision regarding travel expenses of FCC Commissioners and employees on the grounds that it constitutes legislation in an appropriations bill. The point of order was sustained.

It read, "Provided further, That, notwithstanding section 1353 of title 31, United States Code, no Commissioner or employee of the Federal Communications Commission may accept, nor may the Commission accept, payment or reimbursement from a non-Federal entity for travel, subsistence, or related expenses for the purpose of enabling a Commissioner or employee to attend and participate in a convention, conference, or meeting when the entity offering payment or reimbursement is a person or corporation subject to regulation by the Commission, or represents a person or corporation subject to regulation by the Commission, unless the person or corporation is an organization exempt from taxation pursuant to section 501(c)(3) of the Internal Revenue Code of 1986."

Second, Rep. Upton raised a point of order against a similarly worded restriction on Commissioners and employees of the FTC. That point of order was also sustained.

Other Amendments. The House approved, by voice vote, an amendment offered by Rep. Dave Weldon (R-FL) that prohibits funds from being used to issue patents on claims directed to or encompassing a human organism.

The House considered an amendment offered by Rep. Steve King (R-IA) to restrict the use of funds from being used to engage in negotiations respecting a trade agreement with another country which creates or expands a nonimmigrant visa category authorizing the temporary entry of professionals into the U.S. He withdrew the amendment.

7/21. Joshua Bolten, Director of the Office of Management and Budget (OMB), wrote a letter [PDF] to Rep. Billy Tauzin (R-LA), the Chairman of the House Commerce Committee, expressing the Bush administration's support for the Federal Communications Commission's (FCC) revisions of its media ownership rules.

He wrote regarding HR 2799, the "Commerce, Justice, State, and the Judiciary Appropriations, 2004". He stated that "In reaching its conclusions on media ownership, the FCC conducted an unprecedented and exhaustive review of its existing media ownership rules. The review lasted 20 months and included 12 FCC commissioned studies of the U.S. media market. This process led the FCC to update its rules to more accurately reflect the realities of the modern media marketplace, with the enormous proliferation of outlets for news and information. The Administration believes that it is not in the public interest to limit the FCC's ability to implement its new rules."

Bolten concluded that "If this amendment were contained in the final legislation to the President, his senior advisors would recommend that he veto the bill."

7/21. The House Commerce Committee's Subcommittee on Telecommunications and the Internet held a hearing titled "The Regulatory Status of Broadband Services: Information Services, Common Carriage, or Something in Between?" The Federal Communications Commission (FCC) has several open proceeding that pertain to the issue.

Positions of Senior Representatives. Rep. Fred Upton (R-MI), the Chairman of the Subcommittee, stated at the outset of the hearing that "To the casual observer of Title I versus Title II, and classifications of broadband as either a telecommunications service, or an information service, may seem mind numbingly arcane. However, the distinctions are critically important, and the FCC's decisions in this regard may have a profound effect on our nation's consumers, and our economy."

Upton (at right) stated that "outmoded regulation is getting in the way of investment in broadband deployment. The FCC needs to act now."

He advocated "deregulatory parity, not regulatory parity." He added, "in my view, we ought to endeavor to provide the same deregulatory treatment to all broadband services, regardless of the platform by which they are delivered. We need to knock down regulatory barriers which are stifling barriers to invest, if we are to bring the promise of broadband to the American people, and realize the economic stimulus which it will create."

He explained that "old legacy telephone regs are simply not appropriate for broadband services, particularly given that there are numerous technological platforms by which broadband services are delivered. And, it makes not sense to tie one hand behind the backs of the telephone companies seeking to provide the same service as the cable companies, or for that matter, satellite TV companies, wireless companies, or hopefully, in the not to distant future, powerline carrier companies."

Rep. Ed Markey (D-MA), the ranking Democrat on the Subcommittee, argued for parity, but based upon applying rules to both telephone and cable companies providing broadband services. He said the "distinction in nomenclature is important because the providers of information services has differing legal and regulatory obligations than those entities providing telecommunications services. Information services are largely unregulated, as opposed to providers of telecommunications services. Providers of information services do not currently have the universal service, consumer privacy, law enforcement, interconnection, unbundling, or resale obligations that telecommunications carriers have, just to name a few items."

Moreover, "By recently classifying broadband access to the internet over cable systems as an interstate information service, the FCC took jurisdiction away from state regulators, and local franchising authorities for such services, offered by cable operators, and rendered cable modem broadband services unregulated."

He added that "The telephone companies who compete with cable broadband offerings in the residential marketplace with their DSL offerings correctly point out that their service is comparable to that offered by cable operators", and "the fact that the telephone companies seek equal treatment for cable modem and DSL offerings is understandable. They should be treated the same way."

"However, not by deregulating the phone industry by redefining their services so that they have minimal obligations, in the public interest, but to spur on digital technologies and competition, the Congress enacted the Telecommunications Act of 1996. That Act broke down historic barriers to competition", said Rep. Markey. "Central to the Act was the notion that we would treat entities based on the services that they were providing, rather than based on their pedigree as a cable company, or phone company, or on the particular type of facilities used to deliver the service."

However, he continued that the argument that the Congress "also meant to obviate a phone company's or cable company's obligations to law enforcement, interconnection, equal access, universal service, or consumer privacy, is mistaken."

He concluded that "The latitude, however, that the Commission has afforded itself to redefine the very services that we sought to promote in the Telecommunications Act puts in jeopardy, not only many current provisions of law, it also undermines our ability to legislate in the future, especially if the words and terms we use to describe the rights and obligations of unregulated entities may be subsequently swapped for others by regulatory fiat, and in headlong pursuit of obtaining a level of deregulation that Congress did not endorse."

Rep. Billy Tauzin (R-LA), the Chairman of the full Committee, stated that "what we are talking about today is an area of free speech, in a new form. And, every time we talk about the capacity or the power of the federal government, and local governments, to regulate the manner in which Americans speak to one another, in whatever new form they find, I generally fall on the side of less regulation than more."

"It is governmentspeak as to whether or not this new digital world is really information or telecommunications", said Tauzin.

However, he got technical too. He reviewed to the FCC's triennial review order, and praised it for providing that "broadband facilities should not have to be provided on an unbundled basis". He added that "the fact that they decided these are not telecommunications services is a good start."

He also stated that "The underlying transmission component of broadband services is also at stake here. And if you decide that that underlying transmission is going to be subjected to the same sort of regulation by which telephone traffic was formerly regulated, then I think we could get into some deep trouble here."

Background on FCC Proceedings. There are many proceedings at the FCC that relate to this hearing. Several open proceeding are most important.

First, there is the FCC's cable modem service declaratory ruling (DR) and notice of proposed rulemaking (NPRM). On March 14, 2002, the FCC adopted a Declaratory Ruling and Notice of Proposed Rulemaking [75 pages in PDF] that addresses the legal classification and the appropriate regulatory framework for broadband access to the Internet over cable system facilities. It states that "we conclude that cable modem service, as it is currently offered, is properly classified as an interstate information service, not as a cable service, and that there is no separate offering of telecommunications service. In addition, we initiate a rulemaking proceeding to determine the scope of the Commission's jurisdiction to regulate cable modem service and whether (and, if so, how) cable modem service should be regulated under the law ..." (Parentheses in original.)

See also, March 14 FCC release. This is Docket No. 00-185 and Docket No. 02-52.

Second, there is the FCC's wireline broadband NPRM. On February 14, 2002, the FCC adopted this NPRM [58 pages in PDF] that addresses the appropriate regulatory framework for broadband access to the Internet over wireline facilities.

This NPRM states that "we examine the appropriate classification for wireline broadband Internet access service. As discussed more fully below, we tentatively conclude that, as a matter of statutory interpretation, the provision of wireline broadband Internet access service is an information service. In addition, we tentatively conclude that when an entity provides wireline broadband Internet access service over its own transmission facilities, this service, too, is an information service under the Act. In addition, we tentatively conclude that the transmission component of retail wireline broadband Internet access service provided over an entity’s own facilities is ``telecommunications´´ and not a ``telecommunications service.´´ We seek comment on these tentative conclusions and ask additional questions with regard to the proper classification of wireline broadband Internet access service." This is Docket 02-33.

See, TLJ story titled "So, Just What Are All of These FCC Broadband Proceedings About Anyway?", December 12, 2002.

Third, there is the FCC's triennial review proceeding. On February 20, the FCC adopted, but did not release, a report and order regarding the Section 251 unbundling obligations of incumbent local exchange carriers (ILECs). The FCC issued only a short press release [2 pages in PDF] and an attachment [4 pages in PDF]. See, stories in TLJ Daily E-Mail Alert No. 609, February 21, 2003.
 • FCC Announces UNE Report and Order
 • FCC Order Offers Broadband Regulatory Relief
 • FCC Announces Decision on Switching
 • Commentary: Republicans Split On FCC UNE Order
 • Congressional Reaction To FCC UNE Order
While the FCC announced this report and order on February 20, 2003, it has yet to release the order.

The order, among other things, provides that (1) there is no unbundling requirement for fiber to the home (FTTH) loops, (2) there is no unbundling requirement for a transmission path over hybrid loops utilizing the packet switching capabilities of their DLC systems in remote terminals (however, ILECs must still provide unbundled access to a voice grade equivalent channel and high capacity loops utilizing TDM technology, such as DS1s and DS3s), (3) ILECs must continue to provide unbundled access to copper loops and copper subloops, and (4) line sharing as an unbundled network element is eliminated.

Positions of Witnesses. Tom Tauke, SVP for Government Relations at Verizon, and a former member of the House, and its Commerce Committee, stated in his prepared testimony that "We believe that the FCC took the first step in that direction in the broadband sections of the Triennial Review order, limiting some of the ``old rules´´ to the ``old wires´´ of traditional telephony. And Verizon has reacted in the marketplace to what it believes that order says. The FCC now needs to finish the job and free the ``new wires´´ from the remaining ``old rules´´ by acting promptly to establish a consistent national policy that does not interfere with industry's deployment of broadband capabilities. If the Commission does that, Verizon and, I believe, others will respond with greater investment in and deployment of broadband."

"Verizon broadband today is primarily DSL services, which provide significant improvements in data transmission speeds. But DSL is only a first step, with the goal being fiber optic deployment into neighborhoods and homes. But as costly as the job is of making DSL capabilities widely available, the task of rewiring the country with fiber makes DSL deployment look like pocket change", said Tauke.

He argued that "we need a Triennial Review order on broadband that is clear and that cannot be gamed. We need the FCC to finally declare that Broadband technologies will not be subject to the unbundling rules that were devised for a voice network." He also stated that "we need the FCC to finish the job on broadband NOW. It needs to classify our broadband services the same way it already has classified comparable services provided by the dominant cable companies. The FCC should first decide that all broadband services should not be regulated under Title II, and instead should be classified under Title I of the Communications Act. Broadband is not telephony, and it should not be regulated like telephony. Imposing old telephony rules on broadband makes no sense."

In contrast, Thomas Jones, an attorney with the law firm of Willkie Farr & Gallagher, testified on behalf of three competitive local exchange carriers (CLECs), Allegiance Telecom, Conversent Communications, and Time Warner Telecom. He stated in his prepared testimony that "the FCC's proposal to reclassify the transmission used in ILEC broadband Internet access as an unregulated Title I service threatens Congress' established telecommunications policies".

He said that "by reclassifying these services out of Title II and reversing decades of precedent, the FCC would eliminate the ILECs' obligation to sell broadband loops to their CLEC competitors. For most small and medium-sized business customers, the ILECs own the only broadband loops. No other service provider, including cable, wireless or satellite, has deployed ubiquitous business end user connections that have the upstream capacity, reliability and security features of ILEC loops. The ILECs' market power over business loops remains, regardless of what is sent over its loop facilities, whether it be broadband or narrowband, or if the loop is old, new, borrowed or blue. Therefore, the only way for CLECs to serve the business market is by purchasing ILEC broadband loops. Eliminating their right to do so under Title II, which mandates reasonable prices and service quality, will likely destroy competition in this dynamic and innovative segment of the economy."

David Baker, VP for Law and Public Policy at Earthlink, a large ISP, stated in his prepared testimony that the effect of classifying all broadband services as information services "would be far reaching because the common carrier transmission services that are the foundation of the information economy would no longer be required to be made available to information service providers upon reasonable request on non-discriminatory terms and conditions. Network owners would be free to arbitrarily decide who can use their networks, at what price, and on what terms. This would not only work against consumer interests, but vital communications links that can be reached today under court order by law enforcement agencies would suddenly be beyond reach because laws like the Communications Assistance to Law Enforcement Act (CALEA) would no longer apply. Congress would have re-write an entire body of laws that have been carefully enacted over the years to promote competition, protect consumers, and provide for public safety."

He elaborated that all internet access services, whether provided by an ISP, a phone company, or cable company, are information services. However, he said that "all information services are, by definition, delivered via telecommunications, and the offering of such telecommunications, whether by a telco or a cable company, for a fee to the public makes them telecommunications services. This is true whether the Internet access is provided by an independent ISP or by the network operators themselves. Internet access, broadband or otherwise, is therefore an information service riding on top of a transmission component which is a telecommunications service."

Baker criticized the FCC suggestion, which he summarized as "so long as the facility owner refuses to offer consumers the option of buying the transmission link separately from the information services component, the bundled package of transmission and information service is an ``information service´´". He argued that "As a result, facility operators are able to shield their transmission networks from requirements for non-discriminatory access by other ISPs. This all but eliminates competition among broadband Internet service providers and not only violates the letter and intent of the Telecommunications Act, but also does great harm to independent businesses and to consumers."

The Subcommittee also heard from three regulators -- from the FCC, Michigan and Florida. See, prepared testimony of Robert Nelson (Michigan Public Service Commission), prepared testimony of Charles Davidson (Florida Public Service Commission), and prepared testimony of Robert Pepper, the Chief of Policy Development at the FCC's Office of Strategic Planning and Policy Analysis.

Nelson argued that the FCC's approach "is based on an obvious misreading of text of the Act" and "is misguided as a matter of both the law and policy". He stated that "As voice traffic continues to migrate to the broadband platform, all of the consumer protections attendant to even the most basic common carrier voice service will no longer automatically apply if the FCC declares that broadband services are a ``deregulated information service´´ instead of a common carrier service, as it is currently classified. The current common carrier protections under Title II also include the assurance of fair and reliable service at just and reasonable rates; the assurance of just and reasonable terms and conditions of service such as billing and service termination practices; and the assurance of compliance with basic service quality standards.  The FCC’s reclassification also undercuts additional goals that Congress established to ensure that low-income customers who live in rural high-cost areas, and disabled customers have reasonable and affordable access to the network."

In contrast, Davidson argued for a less regulatory approach. He stated that "The broadband sector is characterized by fairly robust intermodal competition. While cable modem service and DSL dominate the broadband market, overall take rates for other technologies (e.g., fixed wireless, Wi-Fi, satellite) are increasing. Of the competing technologies, DSL is potentially subject to greater regulation than the others. Where there is technological parity confronted with a regulatory disparity (i.e., where substitutable products are subject to asymmetrical regulation), the predicted economic outcomes in the long run include: a competitive advantage for the less burdened product; decreased investment in the more burdened technology; and less consumer choice." He added that "Technological parity should result in regulatory parity."

See, also prepared testimony of Robert Sachs (National Cable & Telecommunications Association), and prepared testimony of Debbie Goldman (Alliance for Public Technology).

Unimpeded Connectivity. Paul Misener, VP for Global Public Policy at Amazon.com, testified on behalf of Amazon and the Coalition of Broadband Users and Innovators.

His interest was not in the regulatory classification of broadband services. Rather, he focused on "unimpeded connectivity". He stated in his prepared testimony that "the defining characteristic of the Internet is unimpeded connectivity. Americans today may obtain online any lawful information, products, or services available or sold on the Internet, without any discriminatory interference or impairment by network operators." Misener wants the FCC to prohibit providers of broadband consumer access from imposing any impairments to unimpeded connectivity.

He explained that it is now technologically possible to impair connectivity, there are incentives to do so, and broadband service providers have the market power to do so.

"Broadband consumer access is completely digital and, thus, ... service providers can impair connectivity in ways that were virtually impossible in the narrowband, analog dial-up world. The most obvious impairment is blocking access to certain information, products, and services. ... Other likely impairments include the insertion of ``pop-up´´ advertisements or slower delivery rates based on a consumer's intended type or source of information", said Misener.

He continued that "Broadband service providers, especially those that are vertically integrated, also have clear economic incentives to impair consumer access to certain Internet-based information, products, and services. The economic incentive is obvious when the service providers have collateral businesses in competition with other Internet-based enterprises."

He also stated that "For the next several years, while broadband service providers have market power, competitive forces will not be able to check their technical opportunities and economic incentives to impair consumer access to various Internet-based information, products, and services. Put another way, absent regulatory intervention, consumers will have no choice but to accept such impairments until true competition emerges."

Next Subcommittee Hearing. Rep. Upton stated that "I hope that the FCC is listening because I expect to have the Commission back, shortly after we return in September. We will be asking them to explain, if they have not acted by then."

He also stated that "In February, the Commission announced the results of it Triennial Review. Five months later, the Commission still has not issued it order. It seems that the Commission is moving at dial up speeds. Nevertheless, I am cautiously optimistic that the Commission's order, once issued, will remove significant regulatory shackles from the backs of the ILECs' broadband facilities."

Rep. Upton asked the FCC's Robert Pepper whether the FCC will have released its triennial review order by Labor Day. Pepper said only, "I hope so."

7/22. The Senate Judiciary Committee held a hearing "Bankruptcy and Competition Issues in relation to the WorldCom Case".

Sen. Orrin Hatch (R-UT), the Chairman of the Committee, wrote in his opening statement that "Some have raised fairness concerns that WorldCom will be able to emerge from bankruptcy with much of the fruits of its widespread fraudulent conduct intact. They argue that it will emerge from Chapter 11 with an enhanced market position relative to its competitors, giving it not only a fresh start but a head start. They believe that, in view of the WorldCom case, our bankruptcy system is set up to make crime pay."

He added that "Others contend that the MCI which will emerge from bankruptcy is a new entity with new leadership. They point to the extraordinary measures it has taken to prevent the recurrence of past misdeeds. They further argue that MCI will not have a meaningful competitive advantage from its Chapter 11 reorganization. And, they argue that our bankruptcy laws appropriately are not designed to punish, but rather to permit a company to reorganize and emerge from bankruptcy as a viable entity."

Sen. Patrick Leahy (D-VT), the ranking Democrat on the Committee, wrote in his opening statement that "I understand that there are significant concerns about the competitive landscape as WorldCom emerges from bankruptcy. As a result of the bankruptcy proceeding, WorldCom may have less debt than some of its competitors. Lowered debt ratios are a serious concern and one that bankruptcy courts handle frequently. If, as we move forward, there is some reason to believe the bankruptcy system is breaking down, we are ready to step in and take appropriate action.

William Barr, who was an Attorney General in the first Bush administration, and is now EVP and General Counsel of Verizon, lashed out. He wrote in his prepared testimony that "The federal government’s response to date to the massive fraud committed by MCI is one of the most shameful episodes I have witnessed in Washington since starting my career in public service more than 25 years ago. MCI committed the largest securities fraud in American history, falsely manufacturing more than $11 billion in income. Investors lost roughly $180 billion -- more than three times the losses in Enron -- and MCI’s brazen scheme dramatically deepened the crisis of confidence in corporate America, imposing incalculable costs across the whole economy. In response, the federal government has taken several affirmative steps -- not to punish MCI, or to strip away the gains from its fraud, or to ensure that full restitution is paid to the tens of thousands of pensioners and companies victimized by the fraud -- but to resuscitate the company from its self-inflicted wounds by giving it a series of artificial advantages over law abiding competitors."

In rebuttal, Nicholas Katzenbach, who was an Attorney General in the Johnson administration, and is now a Director of MCI WorldCom, defended the actions of the bankruptcy court. He wrote in his prepared testimony that "I’d like to begin by asking those who would inflict further pain on MCI: Who is it, exactly, whom you intend to punish? Is it the 55,000 employees of MCI, who have already seen their jobs put at risk and their retirement savings driven toward oblivion? Or is it the creditors of the company, who have already seen the value of their investment plummet? Or is it the victims of WorldCom’s fraud who – because of our settlement with the SEC – now have a stake in the future success of MCI? Or is it the nation’s long-distance telephone customers, who would surely see their phone bills rise and see their service suffer if MCI were to be driven out of business? Nothing that MCI’s opponents suggest would hurt the already-departed and already-disgraced senior management of WorldCom, who were ousted and replaced after the fraud was discovered. The draconian punishment advocated by MCI’s opponents would, at best, be a futile gesture – and, at worst, would inflict further pain on the innocent."

See also, prepared testimony of other witnesses: Richard Thornburgh (Bankruptcy Examiner, Kirkpatrick & Lockhart), Marcia Goldstein (Weil Gotshal & Manges), Morton Bahr (President of the Communications Workers of America), Douglas Baird (Vice-Chair of the National Bankruptcy Conference), and Mark Neporent (COO of Cerberus Capital Management).

7/22. The House Science Committee approved, by voice vote, HR 2801, the "Minority Serving Institution Digital & Wireless Network Technology Opportunity Act of 2003".

HR 2801 was introduced on July 21, 2003, by Rep. Randy Forbes (R-VA), Rep. Edolphus Towns (D-NY) and others. It revises HR 2183, a bill by the same title introduced by Rep. Forbes on May 21. These bills are companion to S 196, which was introduced by Sen. George Allen (R-VA) on January 17, 2003. The Senate passed S 196 on April 30, 2003 by a vote of 97-0.

These bills would authorize the appropriation of $250,000,000 for each of the fiscal years 2004 through 2008 for grants to minority serving institutions ("a historically Black college or university", "a Hispanic-serving institution", and "a tribally controlled college or university") to acquire "networking capability, hardware and software, digital network technology, wireless technology, and infrastructure".

One significant difference between the bills is that HR 2801 would place the newly created "Minority Serving Institution Digital and Wireless Technology Opportunity Program" in the Department of Commerce's (DOC) Technology Administration. HR 2183 and S 196 would place the program at the National Science Foundation (NSF). The change would have consequences for the grant review process.

The Committee also adopted by voice vote an amendment offered by Rep. Sherwood Boehlert (R-NY), the Chairman of the Committee, that provides that the technology could be used to educate teachers in science, math, engineering, and technology.  The Committee also approved, by voice vote, an amendment offered by Rep. E.B. Johnson (D-TX) that acknowledges the achievements and contributions of African American scientists, mathematicians, and inventors.

See also, stories titled "Sen. Allen Introduces Bill to Create Technology Grant Program for MSIs" in TLJ Daily E-Mail Alert No. 586, January 20, 2003; "Senate Committee Approves Technology Grant Program for Minority Serving Institutions" in TLJ Daily E-Mail Alert No. 623, March 14, 2003; "Senate Passes Technology Grant Bill" in TLJ Daily E-Mail Alert No. 655, May 5, 2003; "Rep. Forbes Introduces Bill to Provide Grants for Digital and Wireless Technology for MSIs" in TLJ Daily E-Mail Alert No. 669, May 29, 2003; and "House Science Committee Holds Hearing on MSI Tech Grant Bill" in TLJ Daily E-Mail Alert No. 695, July 10, 2003.

7/22. The House Rules Committee adopted a closed rule for the consideration of HR 2738, the "U.S.-Chile Free Trade Agreement Implementation Act", and HR 2739, the "U.S.-Singapore Free Trade Agreement Implementation Act".

7/21. The Office of the U.S. Trade Representative (USTR) released a statement [2 pages in PDF] regarding the provisions in the Chile and Singapore Free Trade Agreements that allow the temporary entry of business professionals into the other party to facilitate trade in services. It states that "Pursuant to the agreements with Chile and Singapore, the movement of Chilean and Singaporean professionals in the United States will be provided by the H-1B visa."

7/22. The House Homeland Security Committee held a hearing titled "Putting the “R” Back into “R&D”: The Importance of Research in Cybersecurity and What More Our Country Needs to Do". See, prepared testimony of witness [in MS Word]: Daniel Wolf (Director for Information Assurance, National Security Agency), Shankar Sastry (Chair and Professor of Department, EE/CS, University of California Berkeley), and Steve Bellovin (AT&T).

7/22. The House Judiciary Committee and the House Homeland Security Committee held a joint hearing titled "The Terrorist Threat Integration Center (TTIC) and its Relationship with the Departments of Justice and Homeland Security". See, prepared testimony of witness [in MS Word]: John Brennan (Director of the TTIC), Larry Mefford (Federal Bureau of Investigation), Jerry Berman (Center for Democracy and Technology), William Parrish (Acting Assistant Secretary for Information Analysis in the Information Analysis and Infrastructure Protection Directorate).

The House will meet at 10:00 AM for legislative business. It may consider HR 2739, the "United States Singapore Free Trade Agreement Implementation Act", HR 2738, the "United States Chile Free Trade Agreement Implementation Act", and/or HR 2799, the "Departments of Commerce, Justice, and State, the Judiciary, and Related Agencies Appropriations Act for Fiscal Year 2004". See, Republican Whip Notice.

9:00 AM. Day one of a two day meeting to the Bureau of Industry and Security's (Bureau of Export Administration) Information Systems Technical Advisory Committee. Part of the meeting will be closed to the public. The agenda includes discussion of export controls on signal generators and arbitrary waveform generators, discussion of developments in micro-processors technology and export controls, discussion of proposal on encryption in network management, election of a new chairman, and secret matters. See, notice in the Federal Register, July 8, 2003, Vol. 68, No. 130, at Pages 40626 - 40627. Location: Room 3884, Hoover Building, 14th St. between Pennsylvania Ave. and Constitution Ave., NW.

LOCATION CHANGE. ? 9:00 AM. The Senate Judiciary Committee might hold an executive business meeting. Press contact: Margarita Tapia at 202 224-5225. This Committee frequently changes the time and agenda of its meetings without notice. Location: Room 216, Hart Building.

9:30 AM. The Senate Commerce Committee will hold a hearing to examine the "public interest and localism". The witnesses will be Robert Corn-Revere (Davis Wright Tremaine), Barry Faber (Sinclair Broadcasting Group), Dave Davis (WPVI-DT), Martin Kaplan (Annenberg School for Communication), and Brent Bozell (Media Research Center). See, notice. Press contact: Rebecca Hanks (McCain) 202 224-2670 or Andy Davis (Hollings) at 202 224-6654. Location: Room 253, Russell Building.

10:30 AM. The House Judiciary Committee will meet to mark up several bills, including HR 1417, the "Copyright Royalty and Distribution Reform Act of 2003". The meeting will be webcast. Press contact: Jeff Lungren or Terry Shawn at 202 225-2492. Location: Room 2141, Rayburn Building.

? 2:00 PM. The Senate Judiciary Committee might hold a hearing on the nominations of Rene Acosta to be an Assistant Attorney General in charge of the Civil Rights Division, and Daniel Bryant to be an Assistant Attorney General in charge of the Office of Legal Policy. Press contact: Margarita Tapia at 202 224-5225. This Committee frequently changes the time and agenda of its meetings without notice. Location: Room 226, Dirksen Building.

2:30 PM. The Senate Commerce Committee will hold a hearing "to examine privacy and digital rights management". Press contact: Rebecca Hanks (McCain) 202 224-2670 or Andy Davis (Hollings) at 202 224-6654. Location: Room 253, Russell Building.

The House will meet at 10:00 AM for legislative business. It may consider HR 2739, the "United States Singapore Free Trade Agreement Implementation Act", HR 2738, the "United States Chile Free Trade Agreement Implementation Act", and/or HR 2799, the "Departments of Commerce, Justice, and State, the Judiciary, and Related Agencies Appropriations Act for Fiscal Year 2004". See, Republican Whip Notice.

9:00 AM. Day two of a two day meeting to the Bureau of Industry and Security's (Bureau of Export Administration) Information Systems Technical Advisory Committee. Part of the meeting will be closed to the public. The agenda includes discussion of export controls on signal generators and arbitrary waveform generators, discussion of developments in micro-processors technology and export controls, discussion of proposal on encryption in network management, election of a new chairman, and secret matters. See, notice in the Federal Register, July 8, 2003, Vol. 68, No. 130, at Pages 40626 - 40627. Location: Room 3884, Hoover Building, 14th St. between Pennsylvania Ave. and Constitution Ave., NW.

? 9:30 AM. The Senate Judiciary Committee might hold an executive business meeting. The agenda might include consideration of several bills, and several judicial and Department of Justice (DOJ) nominations. The judicial nominations are Steven Colloton (U.S. Court of Appeals for the Eighth Circuit), James Browning (District of New Mexico), Brent McKnight (Western District of North Carolina), David Proctor (Northern District of Alabama), Kevin Castel (Southern District of New York), Sandra Feuerstein (Eastern District of New York), Richard Holwell (Southern District of New York), and Stephen Robinson (Southern District of New York). The DOJ nominations are Rene Acosta to be an Assistant Attorney General in charge of the Civil Rights Division, and Daniel Bryant to be an Assistant Attorney General in charge of the Office of Legal Policy. See, notice. Press contact: Margarita Tapia at 202 224-5225 or David Carle (Leahy) at 202 224-4242. This Committee frequently changes the time and agenda of its meetings without notice. Location: Room 226, Dirksen Building.

10:00 AM. The House Armed Services Committee's (HASC) Subcommittee on Terrorism, Unconventional Threats and Capabilities Subcommittee will hold a hearing titled "Cyber Terrorism: The New Asymmetric Threat". The witnesses will be Eugene Spafford (Purdue University), Robert Lentz (Information Assurance, Department of Defense), and Robert Dacey (General Accounting Office). Location: Room 2118, Rayburn Building.

10:00 AM. The House Judiciary Committee's Subcommittee on Courts the Internet and Intellectual Property (CIIP) will will hold a hearing titled "Patent Quality Improvement". The hearing will be webcast. Press contact: Jeff Lungren or Terry Shawn at 202 225-2492. Location: Room 2141, Rayburn Building.

10:00 AM. The Senate Commerce Committee and the House Science Committee will hold a joint hearing on the future of commercial human space flight. See, notice. Location: Room 216, Hart Building.

10:00 AM. Status conference in U.S. v. Microsoft, No. 98-1232.

12:00 NOON - 3:00 PM. The Department of Commerce (DOC) will hold a technology exhibition titled "Technology for all Americans". At 2:00 PM, Phil Bond, Under Secretary for Technology, will announce Secretary of Commerce Donald Evans' new departmental initiatives to support the development of assistive technologies. Location: main lobby, DOC, 14th and Constitution Ave., NW.

SOLD OUT. 1:45 - 3:30 PM. The Intellectual Property Law Section of the D.C. Bar Association will host a visit to the Copyright Office. Prices vary. For more information, call 202 626-3463. Location: Copyright Office, Room 401, Madison Building, First Street and Independence Avenue, SE.

2:00 PM. The The House Judiciary Committee will hold a hearing titled "Antitrust Enforcement Agencies: The Antitrust Division of the Department of Justice and the Bureau of Competition of the Federal Trade Commission". The hearing will be webcast. Press contact: Jeff Lungren or Terry Shawn at 202 225-2492. Location: Room 2141, Rayburn Building.

The House will meet at 10:00 AM for legislative business. It may consider HR 2739, the "United States Singapore Free Trade Agreement Implementation Act", HR 2738, the "United States Chile Free Trade Agreement Implementation Act", and/or HR 2799, the "Departments of Commerce, Justice, and State, the Judiciary, and Related Agencies Appropriations Act for Fiscal Year 2004". See, Republican Whip Notice.

The House is scheduled to begin its August recess.

9:30 AM. The Senate Governmental Affairs Committee will hold a hearing on several nominations, including Penrose Albright to be Assistant Secretary of Homeland Security for Plans, Programs and Budgets, and Joel Kaplan to be Deputy Director of the Office of Management and Budget (OMB). Location: Room 342, Dirksen Building.

? 9:30 AM. The Senate Judiciary Committee might hold an executive business meeting. The agenda includes consideration of several judicial nominations, including Henry Saad (U.S. Court of Appeals for the 6th Circuit), Larry Alan Burns (Southern District of California), Glen Conrad (Western District of Virginia), Henry Floyd (District of South Carolina), Kim Gibson (Western District of Pennsylvania), Michael Mosman (District of Oregon), and Dana Sabraw (Southern District of California)..  Press contact: Margarita Tapia at 202 224-5225 or David Carle (Leahy) at 202 224-4242. This Committee frequently changes the time and agenda of its meetings without notice. Location: Room 226, Dirksen Building.

9:30 AM. The Senate Commerce Committee will hold a business meeting. Press contact: Rebecca Hanks (McCain) 202 224-2670 or Andy Davis (Hollings) at 202 224-6654. Location: Room 253, Russell Building.

10:00 AM. The President's Export Council subcommittee on Export Administration (PECSEA) will hold a meeting. See, notice in the Federal Register: July 15, 2003, Vol. 68, No. 135, at Page 41782. Location: Room 3884, Department of Commerce, 14th Street between Pennsylvania and Constitution Avenues, NW.

Deadline to submit applications for loans or combination loans and grants to the Rural Utilities Service (RUS) under its FY2003 Distance Learning and Telemedicine Program. See, notice in Federal Register, March 3, 2003, Vol. 68, No. 41, at Page 9973.

2:30 PM. The Senate Commerce Committee's Communications Subcommittee will hold a hearing on the Internet Corporation for Assigned Names and Numbers (ICANN). Press contact: Rebecca Hanks (McCain) 202 224-2670 or Andy Davis (Hollings) at 202 224-6654. Location: Room 253, Russell Building.

7/22. The California Court of Appeal issued its opinion [MS Word] in Kaufman v. ACS Systems, a case involving private causes of action filed in state court under the Telephone Consumer Protection Act for unsolicited fax messages. This case addresses only faxes. However, the Court's analysis may be relevant to the current debate over how an e-mail spam bill should be drafted.

Barry Kaufman and David Amkraut are Californians who complain of unsolicited fax messages sent by ACS Systems and Fax.com. They filed two separate complaints in the Superior Court of Los Angeles County alleging violation of the Telephone Consumer Protection Act of 1991 (TCPA), Public Law No. 102‑243, which bans unsolicited faxes. They sought class action status.

The Court "informally coordinated" the two actions. Both of the junk faxers argued that the plaintiffs have no private right of action under the TCPA, that if such a right exists, it is unconstitutional, and that claims under the TCPA cannot be brought as class actions.

The trial court ruled that the plaintiffs could not pursue a TCPA claim in state court because the California Legislature had not enacted a statute expressly permitting such a claim. The trial court also ruled that the TCPA is constitutional and that TCPA claims may be brought as a class action.

This appeal followed. The Court of Appeal affirmed on the constitutional and class action issues. It reversed on the remaining issue. A TCPA action may be maintained in a state court because the California legislature has not prohibited such suits.

This is Barry Kaufman v. ACS Systems, Inc., Super. Ct. No. BC222588, and David Amkraut v. Fax.com, Inc., Super. Ct. No. BC240573, appeal numbers B155804 and B156082, appeals from the Superior Court of Los Angeles County, Judge Ann Kough presiding.

The plaintiffs are Communications Patents and Intellectual Property Development (IPD). Communications Patents is the assignee of U.S. Patent No. 4,135,202 titled "Broadcasting systems with fibre optic transmission lines". IPD is the exclusive licensee.

The defendants are UA-Columbia Cablevision of Westchester and Tele-Communications, Inc. (TCI). They own and operate cable TV systems. Plaintiffs filed a complaint in U.S. District Court (SDNY) against defendants alleging infringement of the '202 patent. The District Court granted summary judgment of non‑infringement and invalidity.

The Court of Appeals affirmed the summary judgment as to non-infringement, but reversed as to invalidity.

This is Intellectual Property Development, Inc. and Communications Patents, Ltd. v. UA-Columbia Cablevision of Westchester, Inc. and Tele-Communications, Inc., No. 02-1248, an appeal from the U.S. District Court for the Southern District of New York, Judge William Pauley presiding.

7/18. The U.S. Court of Appeals (DCCir) issued its opinion [13 pages in PDF] in Starpower v. FCC,

Starpower Communications, a competitive local exchange carrier (CLEC) operating in the state of Virginia, petitioned for review of a Federal Communications Commission (FCC) order holding that two interconnection agreements between Starpower and Verizon unambiguously do not require reciprocal compensation for telephone traffic bound for an internet service provider (ISP).

The Appeals Court held that the agreements are not unambiguous. Rather, they are "models of ambiguity". It granted Starpower's petition, and remanded to the FCC for further proceedings.

This is Starpower Communications, Inc., petitioner v. FCC, respondent, and Verizon, intervenor, No. 02-1131, a petition for review of a final order of the FCC.

7/22. The Office of Management and Budget (OMB) issued a release regarding the draft policy titled "Draft E -- E-Authentication for Federal Agencies". On July 11, 2003, the General Services Administration's (GSA) Office of Electronic Government and Technology published a notice in the Federal Register regarding electronic authentication. The notice attaches, and requests comments on, the draft policy. The OMB supported the GSA in writing the draft policy. Comments are due by August 11, 2003.

The OMB states that it is "is improving identity validation and security online as well as reducing the time citizens wait to access government services on the internet".

In addition, Mark Forman, Administrator of E-Gov and Information Technology at OMB, states in the release that "The E-Authentication E-Gov initiative will enable citizens to securely and easily engage government online. It helps citizens and businesses have confidence in the protection of electronic transactions with the federal government".

The Center for Democracy and Technology (CDT) stated in its web site that "Authentication can involve everything from passwords to biometrics. The issue of online authentication has many implications for privacy and security. For example, it may affect whether citizens can communicate with the government anonymously. It can also facilitate linking of data from online interactions." See, CDT web page titled "Identity, Authentication & Digital Certificates".

See, Federal Register, July 11, 2003, Vol. 68, No. 133, at Pages 41370 - 41374. See also, story titled "GSA and OMB Release Draft E-Authentication Policy" in TLJ Daily E-Mail Alert No. 697, July 14, 2003.

7/22. The U.S. Patent and Trademark Office (USPTO) announced that the USPTO and the World Intellectual Property Organization (WIPO) "held a seminar on July 14-18, 2003, for 16 supreme and appellate court judges from the Asia-Pacific region. The program exposed the judges to a wide range of policy considerations and challenges that their national court systems face in implementing the World Trade Organization (WTO) Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS)." See, USPTO release.