12/15. The Department of Justice (DOJ) settled its civil antitrust lawsuit against First Data Corporation and Concord EFS, Inc.. The DOJ had sued to stop the merger of these two personal identification number (PIN) debit networks. First Data has now agreed to divest its entire interest in NYCE Corporation in order to proceed with its proposed acquisition of Concord EFS.

On October 23, 2003, the DOJ, seven states, and the District of Columbia filed a complaint [28 pages in PDF] in U.S. District Court (DC) against First Data and Concord EFS, alleging that First Data's planned acquisition of Concord would violate Section 7 of the Clayton Act.

The complaint alleged that "Concord operates STAR, the nation's largest PIN debit network. STAR currently handles approximately half of all PIN debit transactions in the United States. First Data owns a controlling interest in NYCE, the nation's third-largest PIN debit network." Hence, "First Data's acquisition of Concord would combine the largest and third-largest point-of-sale ("POS") PIN debit networks in the United States".

See also, story titled "DOJ Sues to Stop Merger of PIN Debit Networks", also published in TLJ Daily E-Mail Alert No. 765, October 24, 2003.

The proposed Final Judgment submitted by the parties provides, in part, that "Defendant First Data is ordered and directed, within one hundred fifty (150) calendar days after the Court's signing of the Hold Separate Stipulation and Order in this matter, or five (5) days after notice of the entry of this Final Judgment by the Court, whichever is later, to divest NYCE Holdings in a manner consistent with this Final Judgment to an Acquirer acceptable to the United States in its sole discretion, after consultation with plaintiff states."

See also, Hold Separate Stipulation and Order and the United States' Memorandum Regarding Procedures for Entry of Final Judgments, both filed on December 15.

The trial had been scheduled to start on December 15 in the U.S. District Court (DC).

Hewitt Pate (at right), the Assistant Attorney General in charge of the DOJ's Antitrust Division, stated in a release that "This settlement is a victory for American businesses and consumers ... The Division was prepared to show at trial that the acquisition, as originally proposed, would have caused merchants to pay higher prices for PIN debit transactions, which could have forced them to pass on those price increases to consumers. This settlement ensures that American businesses will pay competitive prices for PIN debit transactions and that consumers will benefit from that competition."

Concord EFS stated in a release that "In connection with the DOJ settlement, the two companies also agreed to new financial terms, with a new value of approximately $6.9 billion, based on First Data’s closing price on Friday, December 12, 2003, of $39.30. The revised merger agreement also extends the original January 31, 2004 end date to April 30, 2004 to allow sufficient time to obtain the necessary shareholder approvals of the revised terms. The revised agreement increases transaction certainty by eliminating many, but not all, conditions to completing the merger. The boards of both companies have approved the revised agreement."

This case is USA v. First Data & Concord EFS, Inc., U.S. District Court for the District of Columbia, D.C. No. No. 03-2169 (RMC).

12/15. The Supreme Court of California issued its opinion [MS Word] in The People ex rel. Thomas J. Orloff v. Pacific Bell, a case regarding the authority of the California Public Utilities Commission (CPUC), and state prosecutors, to regulate telecommunications carriers. The Court held that carriers may be subject to simultaneous and overlapping proceedings before the CPUC and in the state courts.

The District Attorneys for the Counties of Alameda, San Mateo, and Monterey filed a complaint in California Superior Court against Pacific Bell and others alleging violation of California unfair competition law in connection with their offering of telecommunications services.

Pacific Bell is also regulated by the CPUC. It was conducting a parallel proceeding to investigate the same practices that were the subject of the prosecutors' Superior Court action.

The Superior Court of Alameda County, and the California Court of Appeal, both held that the District Attorneys' action in state court was barred by California Public Utilities Code section 1759. The California Supreme Court reversed.

The California Supreme Court wrote that "section 1759 provides that only this court and the Court of Appeal possess jurisdiction to review decisions of the California Public Utilities Commission (PUC) or ``to enjoin, restrain, or interfere with´´ the PUC in the performance of its duties. Thus, an action filed in superior court against a public utility subject to the jurisdiction of the PUC can be precluded by section 1759, where the action would ``interfere with´´ the authority of the PUC. Here, several district attorneys filed a civil action in superior court, alleging that a public utility violated the law by engaging in false advertising and unfair business practices. An administrative enforcement proceeding involving some of the same allegations of misconduct by this utility was pending in the PUC at the time the civil action was filed, and the superior court and the Court of Appeal concluded that because the present action might result in conflicting rulings with the parallel PUC proceeding, the action would interfere with the authority of the PUC and thus was barred by section 1759."

It concluded that the lower courts erred in determining that the prosecutors' action is barred by Section 1759. It elaborated that "the PUC does not have exclusive jurisdiction over all actions against a public utility" and "the mere possibility of, or potential for, conflict with the PUC is, in general, insufficient in itself to establish that a civil action against a public utility is precluded by section 1759".

The Supreme Court continued that "a number of statutory provisions expressly authorize public law enforcement officials (in addition to the PUC) to initiate civil enforcement actions against public utilities in instances of alleged misconduct by such utilities." (Parentheses in original.)

It concluded that "In expressly establishing overlapping enforcement authority against public utilities by both the PUC and public prosecutors, the Legislature has demonstrated that it contemplates that public prosecutors and the PUC will coordinate their enforcement efforts -- and that the superior court in such a civil action can tailor its proceedings and rulings -- to avoid any actual conflict. Nothing in the present action brought by public prosecutors inevitably would lead to conflicting rulings that would interfere with or undermine the regulatory authority of the PUC, and indeed the PUC itself has filed an amicus curiae brief in this matter, eschewing any suggestion that the initiation and prosecution of this civil action would interfere with the performance of its duties and instead maintaining that civil actions brought by public prosecutors are an important complement to the PUC’s consumer protection efforts. Under these circumstances, we conclude that the superior court erred in dismissing this action under section 1759, and we reverse the judgment of the Court of Appeal upholding the dismissal."

12/12. The U.S. Court of Appeals (9thCir) issued its opinion [15 pages in PDF] in Kalantari v. NITV, a copyright infringement case in which the Appeals Court held that a person who imported and copyrighted three films from Iran did not loose copyright protection as a result of the trade embargo on Iran.

Masood Kalantari obtained by contract the rights to copyright, distribute, and exhibit three Farsi language films in the United States. NITV, Inc., d/b/a National Iranian TV, broadcast the three films in the U.S. without Kalantari's permission.

Kalantari filed a complaint in U.S. District Court (CDCal) against NITV and others alleging copyright infringement. The defendants/copiers moved for summary judgment, arguing that Kalantari holds no valid copyright because he allegedly violated the U.S.'s trade embargo on Iran by purchasing the rights in the three films. The District Court granted summary judgment to the defendants.

The Appeals Court reversed. It wrote that the Iranian trade embargo, which is codified at 31 C.F.R. Part 560, is based upon the International Emergency Economic Powers Act, which was passed in 1977, and is codified at 50 U.S.C. §§ 1701, et seq. However, it contains an exemption for information (which was amended in 1994).

50 U.S.C. § 1702(b) provides that "The authority granted to the President by this section does not include the authority to regulate or prohibit, directly or indirectly ... (3) the importation from any country, ... whether commercial or otherwise, regardless of format or medium of transmission, of any information or informational materials, including but not limited to, publications, films, posters, phonograph records, photographs, microfilms, microfiche, tapes, compact disks, CD ROMs, artworks, and news wire feeds."

The Court also noted the legislative history. This language was introduced by Rep. Howard Berman (D-CA), who is now the ranking Democrat on the House Judiciary Committee's Subcommittee on Courts, the Internet and Intellectual Property, "to prevent the executive branch from restricting the international flow of materials protected by the First Amendment".

The Appeals Court held that "The Iranian embargo does not prohibit the commercial importation of an Iranian movie, the copyrighting of the movie, or the assignment to a United States person of rights to obtain and enforce such a copyright."

Judge Susan Graber wrote the opinion of the Court. Judges Betty Fletcher and Pam Rymer joined.

This case is Masood Kalantari v. NITV, Inc., et al., U.S. Court of Appeals for the 9th Circuit, No. 02-56592, an appeal from the U.S. District Court for the Central District of California, D.C. No. CV-01-05447-PA, Judge Percy Anderson presiding.

12/10. The Federal Communications Commission (FCC) published a notice in the Federal Register summarizing, and providing comment deadlines for, its notice of proposed rulemaking (NPRM) regarding unlicensed devices.

This notice states that comments are due by January 9, 2004, and that reply comments are due by January 26, 2004. See, Federal Register, December 10, 2003, Vol. 68, No. 237, at Pages 68823 - 68831.

The FCC adopted this NPRM on September 10, 2003. See, FCC release [PDF]. See also, story titled "FCC Announces NPRM Regarding Unlicensed Devices" in TLJ Daily E-Mail Alert No. 739, September 15, 2003.

It released the NPRM [35 pages in PDF] on September 17, 2003. This NPRM is FCC 03-223 in ET Docket No. 03-201.

The NPRM states that it proposes to " 1) modify the rules to permit the use of advanced antenna technologies with spread spectrum devices in the 2.4 GHz band; 2) modify the replacement antenna restriction for Part 15 devices; 3) modify the equipment authorization procedures to provide more flexibility to configure transmission systems without the need to obtain separate authorization for every combination of system components; 4) harmonize the measurement procedures for digital modulation systems authorized pursuant to Section 15.247 of the rules with those for similar U-NII devices authorized under Sections 15.401- 15.407 of the rules; 5) modify the channel spacing requirements for frequency hopping spread spectrum devices in the 2.4 GHz band in order to remove barriers to the introduction of new technology that uses wider bandwidths; 6) clarify the equipment authorization requirements for modular transmitters; and 7) make other changes to update or correct Parts 2 and 15 of our rules." (Footnote omitted.)

The NPRM also request comments on ways the FCC "might improve spectrum sharing among unlicensed devices".

12/15. The Federal Communications Commission (FCC) published two notices in the Federal Register regarding its Order on Remand, Further Notice of Proposed Rulemaking, and Memorandum Opinion and Order in CC Docket No. 96-45. It revises the FCC's high cost universal service support mechanism.

This item follows the July 31, 2001 opinion of the U.S. Court of Appeals (10thCir) in Qwest v. FCC, 258 F.3d 1191, which reversed and remanded the FCC's Ninth Order "because it does not provide sufficient reasoning or record evidence to support its reasonableness." See also, the FCC web page titled "Tenth Circuit Remand".

The FCC announced, but did not release, this item on October 16, 2003. See, FCC release [PDF]. See also, story titled "FCC Announces Order on Remand Regarding High Cost Universal Service Support Mechanism" in TLJ Daily E-Mail Alert No. 761, October 20, 2003.

The FCC released the text of this item on October 27, 2003. It is FCC 03-249.

The first notice summarizes the Order on Remand and Memorandum Opinion. It also states that its effective date is January 14, 2004. It is published at Federal Register, December 15, 2003, Vol. 68, No. 240, at Pages 69622 - 69627.

The second notice summarizes the Further Notice of Proposed Rulemaking (FNPRM). It also states that the deadline for comments is January 14, 2004, and that the deadline for reply comments in February 13, 2004. It is published at Federal Register, December 15, 2003, Vol. 68, No. 240, at Pages 69641 - 69647.

For more information, contact Katie King at 202 418-7400 or kking@fcc.gov.

The House is in adjournment.

The Senate is in adjournment. (It will convene on January 20, 2004.)

The Supreme Court is in recess. (It will return on January 12, 2004.)

8:30 AM - 5:00 PM. Day one of a two day meeting of the National Institute of Standards and Technology's (NIST) Information Security and Privacy Advisory Board (ISPAB). The agenda includes "Overview of Program Activities of the NIST Information Technology Laboratory's Computer Security Division", "Update by OMB on Privacy and Security Issues", and "Briefing by Department of Homeland Security Office Privacy Officer Nuala Connor-Kelly". See, notice in the Federal Register, November 21, 2003, Vol. 68, No. 225, at Page 65681. Location: Gaithersburg Hilton Hotel, 620 Perry Parkway, Gaithersburg, MD.

9:00 AM. Department of Homeland Security (DHS) Under Secretary Janet Hale and Chief Financial Officer Bruce Carnes will host an Industry Vendor Day for the eMERGE˛ (Electronically Managing Enterprise Resources for Government Efficiency and Effectiveness) program. Location: Crystal City Marriott Hotel, Crystal Forum Theater, 1999 Jefferson Davis Highway. Arlington, VA.

10:30 - 11:30 AM. The Department of Commerce (DOC) will hold a media roundtable to release and discuss a report titled "The Digital Economy 2003". Phil Bond, Under Secretary of Commerce for Technology, and Kathleen Cooper, Under Secretary for Economic Affairs, will speak. See, notice. Location: Room 4813, DOC, 14th Street and Constitution Ave.

12:00 NOON. AT&T will hold a press conference to announce a collaboration agreement with the Southeastern Universities Research Association (SURA). For more information, contact Jim McGann 703 506-5524. Location: Zenger Room, National Press Club, 529 14th St. NW, 13th Floor.

1:30 - 4:30 AM. The Executive Office of the President's (EOP) Office of Science and Technology Policy's (OSTP) National Science and Technology Council's (NSTC) Committee on Technology and Committee on Homeland and National Security will hold a meeting that is closed to the public. For more information, contact John Hoyt at john.hoyt@dhs.gov or 202 772-9959. Location: White House Conference Center, Truman Room.

Deadline to submit reply comments to the Federal Communications Commission (FCC) in response to its Notice of Proposed Rulemaking (NPRM) regarding implementation of 47 U.S.C. § 272(b)(1). This NPRM is FCC 03-272 in WC Docket No. 03-228. The FCC adopted this NPRM on November 3, 2003, and released it on November 4, 2003. For more information, contact Christi Shewman at 202 418-1686 or christi.shewman@fcc.gov. See, notice in the Federal Register, November 21, 2003, Vol. 68, No. 225 at Pages 65665 - 65667.

8:30 AM - 3:00 PM. The National Institute of Standards and Technology's (NIST) Board of Overseers of the Malcolm Baldrige National Quality Award will hold a meeting. The deadline to register to attend is December 15. Contact Virginia Davis at virginia.davis@nist.gov or 301 975-2361. See, notice in the Federal Register, November 25, 2003, Vol. 68, No. 227, at Page 66075. Location: NIST, Administration Building, Lecture Room A, Gaithersburg, MD.

8:30 AM - 5:00 PM. Day one of a two day meeting of the National Institute of Standards and Technology's (NIST) Information Security and Privacy Advisory Board (ISPAB). The agenda includes "Overview of Program Activities of the NIST Information Technology Laboratory's Computer Security Division", "Update by OMB on Privacy and Security Issues", and "Briefing by Department of Homeland Security Office Privacy Officer Nuala Connor-Kelly". See, notice in the Federal Register, November 21, 2003, Vol. 68, No. 225, at Page 65681. Location: Gaithersburg Hilton Hotel, 620 Perry Parkway, Gaithersburg, MD.

9:30 AM. The Federal Communications Commission (FCC) will hold a meeting. See, agenda [PDF]. Location: FCC, 445 12th Street, SW, Room TW-C05 (Commission Meeting Room).

10:00 AM - 12:00 NOON. The American Enterprise Institute (AEI) will host a panel discussion titled "Civil Liberties and the War on Terror". The speakers will be Michael Chertoff, David Cole, Patricia Wald, Ruth Wedgwood, and John Yoo. See, notice. Location: Twelfth floor, 1150 17th St., NW.

12:15 - 1:30 PM. The Federal Communications Bar Association's (FCBA) Wireless Committee will host a luncheon panel discussion titled "Wireless Telecommunications Bureau: Current Topics and Vision for the Future". The speakers will include John Muleta, Chief of the WTB. The price to attend is $15. For more information, contact laura.phillips@dbr.com or charla.rath@verizonwireless.com. RSVP to wendy@fcba.org. Location: Sidley Austin, 1501 K Street, NW, 6th Floor.

9:00 - 11:30 AM. The Executive Office of the President's (EOP) Office of Science and Technology Policy's (OSTP) National Science and Technology Council's (NSTC) Committee on Technology and Physical Infrastructure Working Group (formerly named the Subcommittee on Construction and Building) will hold a meeting that is closed to the public. For more information, contact Paul Domich at domich@nist.gov or 301 975-5624. Location: White House Conference Center, Jackson Room, 726 Jackson Place, NW.

12:00 NOON. The Federal Communications Bar Association's (FCBA) International Telecommunications Committee will host a brown bag lunch titled "The United Nations World Summit on Information Society (WSIS): Geneva 2003 and the Road to Tunisia 2005". The speaker will be David Gross, Deputy Assistant Secretary for International Communications and Information Policy, Department of State. RSVP to julie.kearney@mci.com. Location: Wiley Rein & Fielding, 1750 K Street, NW.

Deadline to submit reply comments to the Federal Communications Commission (FCC) regarding Northland Networks' petition pursuant to 47 U.S.C. § 252(e)(5) requesting that the FCC preempt the jurisdiction of the New York Public Service Commission to resolve a dispute between Northland and Verizon regarding reciprocal compensation and change of law provisions of their interconnection agreements. This is WC Docket No. 03-242. See, FCC notice [PDF].

Hanukkah.

Deadline to submit initial comments to the Copyright Office (CO) in response to its Notice of Inquiry (NOI) regarding notice and recordkeeping for use of sound recordings under statutory license. The CO published a notice in the Federal Register stating that it "is requesting public comment on the adoption of regulations for records of use of sound recordings performed pursuant to the statutory license for public performances of sound recordings by means of digital audio transmissions between October 28, 1998, and the effective date of soon-to-be-announced interim regulations." See, Federal Register: October 8, 2003, Vol. 68, No. 195, at Page 58054.

12/12. The U.S. Court of Appeals (1stCir) issued its opinion in Metheny v. Kembel, a dispute involving a local zoning board's issuance of a variance permitting Omnipoint Communications to construct a wireless telecommunications tower. Although, the present opinion addresses only the issue of federal question jurisdiction.

The Appeals Court held that, notwithstanding 47 U.S.C. § 332, and especially, 47 U.S.C. § 332(c)(7)(B)(i)(II), the federal courts lacked jurisdiction over this case. This case involved the preclusive effect of a prior federal judgment.

Judge Howard wrote the opinion of the Appeals Court, in which Judges Boudin and Lynch joined. This case is Karen Metheny, et al. v. Katherine Becker, et al., U.S. Court of Appeals for the 1st Circuit, No. 02-2424, an appeal from the U.S. District Court for the District of Massachusetts, Judge William Young presiding.

12/15. Sen. John Breaux (D-LA) announced that he will not seek reelection to the Senate in 2004. He has represented Louisiana in the Senate since 1986. Before that, he a member of the House of Representatives. He is a member of the Senate Commerce Committee and its Communications Subcommittee. He is also a member of the Senate Finance Committee. See, Sen. Breaux release and statement by President Bush.

12/15. Torie Clarke (at right) was named Senior Advisor for Communications and Government Affairs at Comcast Corporation, effective January 1, 2004. She was previously Assistant Secretary of Defense for Public Affairs. She has also worked for Sen. John McCain (R-AZ), the Chairman of the Senate Commerce Committee. She is also a former VP of the National Cable & Telecommunications Association (NCTA). See, Comcast release.

12/12. David Wajsgras was appointed to the Board of Directors of 3Com Corporation. Wajsgras is SVP and CFO of Lear Corporation, an automotive interiors supplier. See, 3Com release.

12/11. Computer Associates International stated in a release that "the United States District Court for the Eastern District of New York has approved the settlement of all outstanding litigation concerning past accounting issues including shareholder and ERISA class-action suits and related derivative litigation. The company announced the settlements in August 2003."

12/15. The Supreme Court granted certiorari in F. Hoffman-LaRoche v. Empagran, No. 03-724. See, Order List [7 pages in PDF at page 1]. This is an antitrust case involving vitamin companies. At issue is whether the Foreign Trade Antitrust Improvements Act of 1982, which is codified at 15 U.S.C. § 6a, provides jurisdiction under the Sherman Act over the claims of a foreign plaintiff injured by a conspiracy having direct, substantial, and reasonably foreseeable anticompetitive effects on U.S. trade or commerce, when the foreign plaintiff's claimed injury does not arise from those domestic effects. See also, January 17, 2003 opinion of the U.S. Court of Appeals (DCCir) in Empagran v. F. Hoffman-LaRoche, No. 01-7115.

12/12. Lucent Technologies stated in a release that "it received final district court approval of its agreement to settle pending shareowner and related litigation against the company, certain of its current and former officers and directors, and certain other defendants." This is In Re Lucent Technologies Securities Litigation, U.S. District Court for the District of New Jersey, D.C. No. 00-CV-621, and consolidated cases.

12/12. The U.S. District Court (DMass) issued an order [14 pages in PDF] in In Re Lernout & Hauspie Securities Litigation.