10/21. The Department of Justice's (DOJ) Antitrust Division released a document titled "Antitrust Division Policy Guide to Merger Remedies".

Section 15 of the Clayton Act, which is codified at 15 U.S.C. § 25, and Section 4 of the Sherman Act, which is codified at 15 U.S.C. § 4, authorize the DOJ to challenge mergers and acquisitions. This Guide states that its purpose "is to provide Antitrust Division attorneys and economists with a framework for fashioning and implementing appropriate relief short of a full-stop injunction in merger cases."

The Guide states that it "sets forth the policy considerations that should guide Division attorneys and economists when fashioning remedies for anticompetitive mergers", but that it is not a "practice handbook" or "a compendium of decree provisions".

Hewitt Pate, the Assistant Attorney General in charge of the Antitrust Division, stated in a release that "The Remedies Guide provides the tools needed to more quickly identify critical legal and economic issues regarding merger remedies and devise a remedy specifically tailored to the competitive harm".

The Guide begins by listing and then discussing six principles. These are:

• "The Antitrust Division Will Not Accept a Remedy Unless There Is a Sound Basis for Believing a Violation Will Occur"
• "Remedies Must Be Based upon a Careful Application of Sound Legal and Economic Principles to the Particular Facts of the Case at Hand"
• "Restoring Competition Is the Key to an Antitrust Remedy"
• "The Remedy Should Promote Competition, Not Competitors"
• "The Remedy Must Be Enforceable"
• "The Antitrust Division Will Commit the Time and Effort Necessary to Ensure Full Compliance with the Remedy"

The Guide then addresses the form of remedies. "Merger remedies take two basic forms: one addresses the structure of the market, the other the conduct of the merged firm. Structural remedies generally will involve the sale of physical assets by the merging firms. In some instances, market structure can also be changed by requiring, for example, that the merged firm create new competitors through the sale or licensing of intellectual property".

Conversely, "A conduct remedy usually entails injunctive provisions that would, in effect, manage or regulate the merged firm's postmerger business conduct."

The Guide concludes that structural remedies are preferred. It states that "Structural remedies are preferred to conduct remedies in merger cases because they are relatively clean and certain, and generally avoid costly government entanglement in the market."

The Guide also concludes that a divestiture must include all assets necessary for the purchaser to be an effective, long term competitor. "The assets consolidated in a merger may be tangible (factories capable of producing automobiles or raw materials used in the production of some other final good) or intangible (patents, copyrights, trademarks, or rights to facilities such as airport gates or landing slots). The goal of a divestiture is to ensure that the purchaser possesses both the means and the incentive to maintain the level of premerger competition in the market(s) of concern." (Parentheses in original. Footnotes omitted.)

It continues that "there are certain intangible assets that likely should be conveyed whenever tangible assets are divested. Many of these simply provide valuable information to the purchaser -- for example, documents and computer records providing the purchaser with customer information or production information, research results, computer software, and market evaluations. Others pertain to patents, copyrights, trademarks, other IP rights, licenses, or access to key intangible inputs (for example, access to a particular range of broadcast spectrum) that are necessary to allow for the most productive use of any tangible assets being divested, or of any tangible assets already in the hands of the purchaser." (Parentheses in original.)

The Guide next concludes that the DOJ "favors the divestiture of an existing business entity that has already demonstrated its ability to compete in the relevant market. An existing business entity should possess not only all the physical assets, but also the personnel, customer lists, information systems, intangible assets, and management infrastructure necessary for the efficient production and distribution of the relevant product." (Footnote omitted.) Although, the Guide also lists several caveats to this principle.

Fourth, the Guide concludes that "Where the critical asset is an intangible one -- e.g., where firms with alternative patent rights for producing the same final product are merging -- structural relief must provide one or more purchasers with rights to that asset. Such rights can be provided either by sale to a different owner or through licensing." (Footnotes omitted.)

With respect to conduct remedies the Guide states that they are "generally are not favored in merger cases because they tend to entangle the Division and the courts in the operation of a market on an ongoing basis and impose direct, frequently substantial, costs upon the government and public that structural remedies can avoid. However, there are limited circumstances when conduct remedies will be appropriate: (a) when conduct relief is needed to facilitate transition to or support a competitive structural solution, i.e., when the merged firm needs to modify its conduct for structural relief to be effective or (b) when a full-stop prohibition of the merger would sacrifice significant efficiencies and a structural remedy would also sacrifice such efficiencies or is infeasible."

10/21. Stephen Kunin, Deputy Commission of Patent Examination Policy at the U.S. Patent and Trademark Office (USPTO), will leave the USPTO at the end of October. He will join the law firm of Oblon Spivak.

10/21. The Federal Communications Commission (FCC) released its Seventh Report and Order [45 pages in PDF], which takes further action to clear 45 MHz of spectrum in the 1710-1755 MHz band for Advanced Wireless Services (AWS) such as Third Generation (3G) wireless services. The FCC adopted, but did not release, this item at its October 14 meeting. This report and order is FCC 04-246 in ET Docket No. 00-258 and WT Docket No. 02-8. See also, story titled "FCC Adopts Report and Order Re 1710-1755 MHz Band" in TLJ Daily E-Mail Alert No. 997.

10/21. The Federal Communications Commission's (FCC) Enforcement Bureau (EB) released two consent decrees that resolve investigations pertaining to the FCC's children's programming rules. See, Order and Consent Decree [9 pages in PDF] in the proceeding Viacom International Inc.'s Nickelodeon, and Order and Consent Decree [10 pages in PDF] in the proceeding pertaining to ABC Family Worldwide, Inc. FCC Chairman Michael Powell stated in a release [PDF] that "As a result of routine audits conducted by Enforcement Bureau field agents, serious questions arose concerning the amount of commercial matter during children’s programs on the ABC Family Channel and Nickelodeon. Both channels are hugely popular with children and are carried on virtually all cable systems nationwide, each reaching in excess of 85 million households. The consent decrees entered into today will not only help protect children who watch these cable channels, but will have a much broader impact. All cable operators, DBS providers, commercial television broadcasters, and companies that provide children’s programming should know that we will vigorously enforce our children’s advertising limits."

10/21. Secretary of the Treasury John Snow gave a speech titled "New Directions for U.S. Economic Policy towards Japan and China" in St. Louis, Missouri. He said that the Bush administration has been actively engaging with the People's Republic of China on trade and intellectual property rights. For example, he sited that China has recently "agreed to non-discriminatory tax treatment for U.S. integrated circuits in China, the world's fastest growing semiconductor market." Yet, he said, "Despite these significant, tangible improvements, a major concern for the United States government remains China's failure to provide adequate protection for, and enforcement of, intellectual property rights. Real progress in this area requires China to show significant reductions in infringements of intellectual property rights and substantial improvements in enforcement."

The House is in recess until November 16, 2004. See, Republican Whip Notice.

The Senate is in recess until November 16, 2004.

12:15 PM. The Federal Communications Bar Association's (FCBA) Young Lawyers Committee will host a brown bag lunch. Harry Martin (President of the FCBA) and Michele Farquhar (President-Elect of the FCBA) will speak on involvement in the FCBA and building a career in communications law. For more information, contact Jason Friedrich at jason.friedrich@dbr.com or Pam Slipakoff at Pam.Slipakoff@fcc.gov. Location: Drinker Biddle & Reath, 1500 K Street NW, Suite 1100.

LOCATION CHANGE. 12:30 - 2:00 PM. The Congressional Internet Caucus Advisory Committee, the Federal Trade Commission (FTC), and the National Cyber Security Alliance (NCSA) will host a panel discussion titled "Computer Security: What Your Constituents Need to Know". The speakers will be FTC Commissioner Orson Swindle, Susan Koehler (Microsoft), Martha Lockwood, (NCSA), and Wendy Tazelaar (WellsFargo.com). Lunch will be served. Registration is required; contact rsvp@netcaucus.org or 202 638-4370. Location: Cannon Caucus Room.

Day one of a five day conference hosted by the Office of the Secretary of Defense (OSD) Networks and Information Integration (NII) and the Joint Chiefs of Staff titled "7th Annual DoD Spectrum Management Conference". See, notice. Location: Radisson Hotel, Annapolis, Maryland.

9:30 AM. The Department of Commerce's (DOC) Bureau of Industry and Security's (BIS/BXA) Sensors and Instrumentation Technical Advisory Committee (SITAC) will hold a partially closed meeting. The agenda includes discussion of Wassenaar Export Group proposals on semiconductor lasers and cameras. See, notice in the Federal Register, October 8, 2004, Vol. 69, No.195, at Page 60352. Location: Room 3884, DOC, 14th Street between Constitution and Pennsylvania Aves., NW.

Day two of a five day conference hosted by the Office of the Secretary of Defense (OSD) Networks and Information Integration (NII) and the Joint Chiefs of Staff titled "7th Annual DoD Spectrum Management Conference". See, notice. Location: Radisson Hotel, Annapolis, MD.

Deadline to submit reply comments to the Library of Congress in response to its notice of proposed rulemaking (NPRM) regarding continuation, with a few modifications, of the procedures adopted by the Copyright Office in 1995 that permit copyright applicants to request reconsideration of decisions to refuse registration. See, notice in the Federal Register, July 13, 2004, Vol. 69, No. 133, at Pages 42004 - 42007.

10:00 AM - 3:00 PM. The Federal Communications Commission's (FCC) Technology Advisory Council will meet. The topic will be ultrawideband (UWB) technology. See, FCC notice [PDF], and notice in the Federal Register, September 28, 2004, Vol. 69, No. 187, at Page 57915. Location: FCC, 445 12th St. SW., Room TW-C305.

2:00 - 4:00 PM. The Department of State's Telecommunication Advisory Committee (ITAC) will meet. See, notice in the Federal Register, October 14, 2004, Vol. 69, No. 198, at Page 61066.

Day three of a five day conference hosted by the Office of the Secretary of Defense (OSD) Networks and Information Integration (NII) and the Joint Chiefs of Staff titled "7th Annual DoD Spectrum Management Conference". See, notice. Location: Radisson Hotel, Annapolis, MD.

Deadline to submit comments to the Department of Commerce's Technology Administration in response to its request for comments regarding the recycling of electronics equipment, such as flat panel monitors. See, TA notice.

Day four of a five day conference hosted by the Office of the Secretary of Defense (OSD) Networks and Information Integration (NII) and the Joint Chiefs of Staff titled "7th Annual DoD Spectrum Management Conference". See, notice. Location: Radisson Hotel, Annapolis, Maryland.

8:30 - 11:30 AM. The Software and Information Industry Association (SIIA) will host a seminar titled "Software Licensing Best Practices Seminar Series: Licensing (and Other) Issues in Software Distribution". See, notice. Prices vary. Location: Mintz Levin, 12010 Sunset Hills Road, Suite 900 Reston, Virginia.

2:00 - 4:00 PM. The Federal Communications Commission's (FCC) WRC 07 Advisory Committee's Informal Working Group 3: IMT-2000 and 2.5 GHz Sharing Issues, will meet. See, FCC notice [PDF]. Location: FCC, 445 12th Street, SW, South Conference Room (8th Floor, Room 8-B516).

6:00 - 8:00 PM. The Federal Communications Bar Association (FCBA) will host the second part of a two part continuing legal education (CLE) seminar on Homeland Security. Prices vary. See, notice. Location: FCC, Commission Meeting Room, 445 12th St., SW.

Day five of a five day conference hosted by the Office of the Secretary of Defense (OSD) Networks and Information Integration (NII) and the Joint Chiefs of Staff titled "7th Annual DoD Spectrum Management Conference". See, notice. Location: Radisson Hotel, Annapolis, Maryland.

Deadline to submit comments to the Federal Communications Commission (FCC) in response to its notice of proposed rulemaking (NPRM) regarding the Emergency Alert System (EAS). The FCC adopted this NPRM at its August 4, 2004 meeting, and released it on August 12, 2004. This NPRM is FCC 04-189 in EB Docket No. 04-296. See, notice in the Federal Register, August 30, 2004, Vol. 69, No. 167, at Pages 52843 - 52847.

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