1/5. The Supreme Court granted certiorari in Tellabs v. Makor. See, Order List [4 pages in PDF] at page 3. The case pertains to the scienter requirements of the Private Securities Litigations Reform Act (PSLRA).

The Congress enacted the PSLRA in 1995 to revise federal securities law to insulate defendants from abusive lawsuits. It was Public Law No. 104-67. It is now codified at 15 U.S.C. § 78u-4 and § 78u-5.

The PSLRA created both a safe harbor for forward looking statements, and a heightened pleading requirement. Plaintiffs must "state with particularity facts giving rise to a strong inference that the defendant acted with the required state of mind."

This language is vague, and has resulted in conflicting interpretations by the various circuit courts that have interpreted it. It is also important to the technology sector, since it is the target of many actions by law firms that specialize in class action litigation. Many of these suits are meritless.

The Supreme Court also ordered expedited briefing. It wrote that "The petition for a writ of certiorari is granted. The brief  of petitioners is to be filed with the Clerk and served upon opposing counsel on or before 2 p.m., Friday, February 9, 2007. The brief of respondents is to be filed with the Clerk and served upon opposing counsel on or before 2 p.m., Friday, March 9, 2007. A reply brief, if any, is to be filed with the Clerk and served upon opposing counsel on or before 2 p.m., Tuesday, March 20, 2007."

Tellabs makes equipment used in fiber optic cable networks. It is a publicly traded company. The plaintiffs, are nominally Makor Issues & Rights, Ltd. and others. This is a class action lawsuit brought by Milberg Weiss.

The plaintiffs filed a complaint in U.S. District Court (NDIll) against Tellabs, Richard Notebaert and others alleging securities fraud in violation of § 10(b) of the Securities Exchange Act of 1934 (which is codified in 15 U.S.C. § 78j) and Rule 10(b)(5) thereunder, and control person liability by Tellabs executives.

The District Court dismissed the complaint pursuant to Rule 12(b)(6) for failure to state a claim upon which relief can be granted. It held that the complaint failed to satisfy the scienter requirements established by the PSLRA. The Court of Appeals reversed in part.

A three judge panel of the U.S. Court of Appeals (7thCir) issued its initial opinion [28 pages in PDF] on January 25, 2006.

The same panel of the Court of Appeals issued its Order on Petition for Rehearing [2 pages in PDF] on July 10, 2006, in which it denied rehearing, and modified one paragraph in the original opinion regarding control person liability.

The Securities Industry and Financial Markets Association (SIFMA) and the U.S. Chamber of Commerce argued in their joint amicus brief [25 pages in PDF] that the SCUS should grant certiorari.

They wrote that "To avoid dismissal, the PSLRA requires that securities fraud plaintiffs plead ``with particularity´´ facts giving rise to a ``strong inference´´ of scienter. ... Because the courts of appeals are hopelessly divided over the meaning of this frequently litigated standard, ... deficient complaints like the one in this case often escape dismissal. That result frustrates the PSLRA’s goal of curbing abusive securities litigation, which has harmful consequences for the national economy. ... This Court’s review is needed now."

The petitioners are represented by Carter Phillips of the Washington DC office of the law firm of Sidley Austin. The respondents are represented by Richard Weiss of the law firm of Milberg Weiss Bershad & Schulman.

This case is Tellabs, Inc. and Richard Notebaert v. Makor Issues & Rights, Ltd., et al., Sup. Ct. No. 06-484, a petition for writ of certiorari to the U.S. Court of Appeals for the 7th Circuit, App. Ct. No. 04-1687. Judge Wood wrote the opinion of the Court of Appeals, in which Judges Ripple and Sykes joined. The Court of Appeals heard an appeal from the U.S. District Court of the Northern District of Illinois, Eastern Division, D.C. No. 02 C 04356, Judge Amy St. Eve presiding.

See also, Supreme Court docket.

1/5. Rep. Bennie Thompson (D-MS) and others introduced HR 1, which states that it is "A bill to provide for the implementation of the recommendations of the National Commission on Terrorist Attacks Upon the United States". This is a huge bill with many different provisions. One title relates to the protection of privacy and civil liberties. The House is scheduled to debate and approve this bill on Tuesday, January 9, 2007.

Privacy and Civil Liberties. Title XIII of the bill addresses the protection of privacy and civil liberties by federal agencies. It includes the "Protection of Civil Liberties Act", which revises the structure of the Privacy and Civil Liberties Oversight Board (PCLOB), and the "Privacy Officer With Enhanced Rights Act of 2007" or "POWER Act", which increases the power and effectiveness of the privacy officer at the Department of Homeland Security (DHS).

This title creates no new substantive rights or law. Nor does it delegate rule making authority to any agency. It pertains solely to the structure of executive departments and agencies, and administrative process.

The PCLOB, which was created by Section 1061(b) of the Intelligence Reform and Terrorism Prevention Act of 2004, which is codified at 5 U.S.C. § 601 note, is part of the Executive Office of the President (EOP). HR 1 would make it "an independent agency within the Executive branch".

The PCLOB is currently chaired by Carol Dinkins. Alan Charles Raul is the Vice Chairman. Both positions require Senate confirmation. The other members, who are not confirmed by the Senate, are Lanny Davis, Ted Olson, and Francis Taylor.

HR 1 would make all positions of a five member board subject to Senate confirmation. All would be for six year terms. However, for the first six years the appointments would be for two, three, four, five, and six years, so that thereafter, one position would open each year.

HR 1 also provides that "in no event shall more than 3 members of the Board be members of the same political party. The President shall, before appointing an individual who is not a member of the same political party as the President consult with the leadership of that party, if any, in the Senate and House of Representatives." That is, HR 1 would structure the PCLOB in a manner similar to the Federal Communications Commission (FCC).

HR 1 also gives the PCLOB, with the support of at least three members, the power to issue subpoenas, and to obtain orders enforcing these subpoenas from "the United States district court for the judicial district in which the subpoenaed person resides".

The PCLOB would also have the power to to hold hearings, and issue reports. It would not have any rulemaking or adjudicatory authority.

The bill requires the Department of Justice (DOJ), Department of Defense, Department of State, Department of the Treasury, Department of Health and Human Services, Department of Homeland Security, and all "intelligence community" agencies to have privacy and civil liberties officers. In addition, the bill provides that the PCLOB may designate any other department, agency, or element of the executive branch to have a privacy and civil liberties officers.

To date, some agencies with privacy officers have not provided those privacy officers with access to the information that they would need to assess the privacy implications of the activities and operations of the agency.

HR 1 addresses this. For example, it provides that "The head of each department, agency, or element shall ensure that each privacy officer and civil liberties officer -- (1) has the information, material, and resources necessary to fulfill the functions of such officer; (2) is advised of proposed policy changes; (3) is consulted by decisionmakers; and (4) is given access to material and personnel the officer determines to be necessary to carry out the functions of such officer."

HR 1 also contains a section that specifically addresses the powers of the privacy officer at the DHS, a agency which has obstructed the work of its privacy officer. The bill provides that this person's powers include subpoenas and taking of oaths.

Section 812 of HR 1 provides that Section 222 of the Homeland Security Act of 2002 is amended to provided that this privacy officer (senior official) is authorized to do the following:

"(A) to have access to all records, reports, audits, reviews, documents, papers, recommendations, and other materials available to the Department that relate to programs and operations with respect to which the senior official has responsibilities under this section;

(B) to make such investigations and reports relating to the administration of the programs and operations of the Department as are, in the senior official's judgment, necessary or desirable;

(C) to require by subpoena the production, by persons other than Federal agencies, of all information, documents, reports, answers, records, accounts, papers, and other data and documentary evidence necessary to performance of the functions of the senior official under this section;

(D) to administer to or take from any person an oath, affirmation, or affidavit, whenever necessary to performance of the functions of the senior official under this section; and

(E) to take any other action that may be taken by the Inspector General of the Department, as necessary to require employees of the Department to produce documents and answer questions relevant to performance of the functions of the senior official under this section."

Moreover, to protect this person from pressure or retaliation, this section provides job tenure of 5 years.

Other Provisions. Title II of HR 1 amends Title V of the Homeland Security Act of 2002, which is codified at Title 6 of the U.S. Code, by adding a new section that provides for grants to states and regions for interoperable emergency communications.

Title VIII of HR 1 requires the DHS to "establish a comprehensive information technology network architecture for the Office of Intelligence and Analysis.", which "shall, to the extent possible, incorporate the approaches, features, and functions of the network proposed by the Markle Foundation in reports issued in October 2002 and December 2003, known as the System-wide Homeland Security Analysis and Resource Exchange (SHARE) Network."

Title IX of HR 1 requires the DHS to create a "national database of nationwide critical infrastructure assets to identify and prioritize critical infrastructure and key resources and to protect them from terrorist attack". This would be named the "National Asset Database". The bill also requires the DHS to create, as a subset, a "National At-Risk Database".

1/5. House Democrats introduced bills to be approved by the House during the week of January 8, 2007. The bills, and their descriptions contained in the Congressional Record, are as follows.

Rep. George Miller (D-CA) and others introduced HR 2, "A bill to amend the Fair Labor Standards Act of 1938 to provide for an increase in the Federal minimum wage".

Rep. Diana DeGette (D-CO) and others introduced HR 3, "A bill to amend the Public Health Service Act to provide for human embryonic stem cell research".

Rep. John Dingell (D-MI) and others introduced HR 4, "A bill to amend part D of title XVIII of the Social Security Act to require the Secretary of Health and Human Services to negotiate lower covered part D drug prices on behalf of Medicare beneficiaries".

The House will not meet. See, House Majority Leader's weekly calendar [PDF].

Deadline to submit reply comments to the Federal Communications Commission (FCC) regarding competitive bidding procedures for Auction No. 72, the Phase II 220 MHz spectrum licenses auction scheduled to commence on June 20, 2007. See, notice in the Federal Register, December 20, 2006, Vol. 71, No. 244, at Pages 76332-76336.

The House will meet at 10:30 AM for morning hour, and at 12:00 NOON for legislative business. It will consider HR 1, a bill related to recommendations of the 9/11 Commission, and HRes 35, a resolution related to the Select Intelligence Oversight Panel. See, House Majority Leader's weekly calendar [PDF].

9:00 AM. The President's Council of Advisors on Science and Technology (PCAST) will meet. See, notice in the Federal Register, December 22, 2006, Vol. 71, No. 246, at Page 77019-77020. The PCAST web site states that this meeting will take place on January 9-10. Location: Congressional Ballroom, Renaissance Hotel, 999 9th St., NW.

9:30 AM. The Senate Homeland Security and Governmental Affairs Committee will hold a hearing titled "Ensuring Full Implementation of the 9/11 Commission’s Recommendations". See, notice. Location: Room 342, Dirksen Building.

10:00 AM. The Supreme Court will hear oral argument in Sinochem International v. Malaysia International Shipping, a petition for writ of certiorari to the U.S. Court of Appeals (3rdCir) in a case involving personal jurisdiction and the doctrine of forum non conveniens. See, SCUS calendar.

12:15 PM. The Federal Communications Bar Association's (FCBA) Mass Media Practice Committee will host a brown bag lunch titled "New rules for AM and FM allotments and channel assignments". The speakers will include Tom Nessinger and Jim Bradshaw of the FCC's Audio Division. For more information, contact David OConnor at david.oconnor at hklaw dot com or 202-828-1889. Location: Holland & Knight, Lower Level, 2099 Pennsylvania Ave., NW.

12:30 PM. Sen. Ted Kennedy (D-MA) will give a speech. Location: National Press Club, 529 14th St. NW, 13th Floor.

2:00 - 4:00 PM. The American Enterprise Institute (AEI) will host a book forum for John Taylor, author of Global Financial Warriors: The Untold Story of International Finance in the Post 9-11 World [Amazon]. The speakers will be Taylor (former Treasury Under Secretary for International Affairs), John Lipsky (International Monetary Fund), Faryar Shirzad (Goldman Sachs), and Steven Davis (AEI). See, notice. Location: AEI, 12th floor, 1150 17th St., NW.

The House will meet at 10:00 AM for legislative business. It will consider a bill HR 2, related to increase the mandatory minimum hourly wage. See, House Majority Leader's weekly calendar [PDF].

9:30 AM. The Senate Judiciary Committee (SJC) will hold a hearing titled "Balancing Privacy and Security: The Privacy Implications of Government Data Mining Programs". The witnesses will be former Rep. Robert Barr (R-GA), James Carafano (Heritage Foundation), Jim Harper (Cato Institute, author of Identity Crisis: How Identification Is Overused and Misunderstood, Leslie Harris (Center for Democracy and Technology), and Kim Taipale (Center for Advanced Studies in Science and Technology Policy). See, notice. Location: Room 226, Dirksen Building.

10:00 AM. The Senate Finance Committee will hold a hearing titled "Tax Incentives for Businesses in Response to a Minimum Wage Increase". See, notice. Location: Room 215, Dirksen Building.

11:00 AM - 12:30 PM. The National Science Foundation's (NSF) National Science Board Commission on 21st Century Education in Science, Technology, Engineering, and Mathematics will meet on site and by teleconference. See, notice in the Federal Register, December 29, 2006, Vol. 71, No. 250, at Page 78468. Location: NSF, Room 545, Stafford II Building, 4121 Wilson Blvd., Arlington, VA.

12:00 NOON - 1:00 PM. The Federal Communications Bar Association's (FCBA) Annual Seminar Committee Committee will host a brown bag lunch. For more information, contact Yaron Dori at ydori at hhlaw dot com or 202-637-5458. Location: Harris Wiltshire & Grannis, 1200 18th Street, NW.

2:00 PM. The House Ways and Means Committee (HWMC) will meet to organize for the 110th Congress. See, notice. Location: Room 1100, Longworth Building.

2:00 PM. The House Armed Services Committee (HASC) will meet to organize for the 110th Congress. Location: Room 2118 Rayburn Building.

6:00 - 9:15 PM. The DC Bar Association will host a continuing legal education (CLE) seminar titled "Patent Law for Non-Patent Lawyers". The speakers will include Anthony Son (Foley & Lardner) and Elizabeth Brenner (Rothwell Figg Ernst & Manbeck). The price to attend ranges from $80 to $135. For more information, call 202-626-3488. See, notice. Location: DC Bar Conference Center, 1250 H St NW B-1 Level.

The Federal Communications Commission (FCC) is scheduled to commence Auction No. 68 (FM broadcast auction). See, October 6, 2006, FCC Public Notice [60 pages in PDF] (DA 06-1949).

The House will meet at 10:00 AM for legislative business. It will consider HR 3, a bill related to stem cell research. See, House Majority Leader's weekly calendar [PDF].

TIME? The Department of Homeland Security's (DHS) Homeland Security Advisory Council will hold a partially closed meeting. See, notice in the Federal Register, December 22, 2006, Vol. 71, No. 246, at Page 77039. Locations: the open portions of the meeting will be held in the Congressional Room, Lobby Floor, Hyatt Regency Washington, 400 New Jersey Ave., NW. The closed portions will be held in the Thornton Room of the Hyatt Regency Washington, and at an undisclosed location.

? 9:30 AM - 5:00 PM. The Antitrust Modernization Commission (AMC) will meet to "deliberate on its report and/or recommendations to Congress and the President regarding the antitrust laws." See, notice in the Federal Register, December 15, 2006, Vol. 71, No. 241, at Pages 75495-75496. Location: Morgan Lewis, Main Conference Room, 1111 Pennsylvania Ave., NW.

10:00 AM. The Senate Finance Committee (SFC) will hold a hearing titled "Prescription Drug Pricing and Negotiation: An Overview and Economic Perspectives for the Medicare Prescription Drug Benefit". See, notice. Location: Room 215, Dirksen Building.

12:00 NOON - 1:30 PM. The DC Bar Association will host a program titled "Current Topics in Patent Law: Vanquishing the Patent Troll". The speakers will include Robert Resis (Banner & Witcoff). The price to attend ranges from $20 to $30. For more information, call 202-626-3463. See, notice. Location: DC Bar Conference Center, 1250 H St NW B-1 Level.

12:15 - 1:40 PM. The Federal Communications Bar Association's (FCBA) Transactional Practice Committee will host a brown bag lunch and fee based continuing legal education (CLE) seminar titled "Outsourcing Transactions". The FCBA stated that this lunch will address "Why do telecom companies do outsourcing transactions, what are they trying to accomplish, what issues arise in negotiating and drafting the agreements, and what are the best practices for addressing those issues?" The speakers will be Jonathan Spencer (VP and General Counsel of Shenandoah Telecommunications) and Glynna Christian (LeBoeuf Lamb). The price to attend ranges from $25 to $60. See, registration form [PDF]. Registrations and cancellations are due by 5:00 PM on January 9. For more information, contact Teresa Lloyd at tlloyd at llgm dot com or 202-986-8184 Location: Paul Hastings, 875 15th Street, NW.

6:00 - 8:15 PM. The DC Bar Association will host a continuing legal education (CLE) seminar titled "Trade Secrets in the District of Columbia, Maryland and Virginia". The speakers will include Milton Babirak (Babirak Vangellow & Carr). The price to attend ranges from $80 to $135. For more information, call 202-626-3488. See, notice. Location: DC Bar Conference Center, 1250 H St NW B-1 Level.

Deadline to submit initial comments to the Federal Communications Commission (FCC) in response to its 7th Further Notice of Proposed Rulemaking in its proceeding titled "Advanced Television Systems and Their Impact Upon the Existing Television Broadcast Service". This item proposes a new DTV Table of Allotments providing all eligible stations with channels for DTV operations after the DTV transition. The FCC adopted this item on October 10, 2006, and released it on October 20, 2006. See, story titled "FCC Adopts NPRM Proposing New DTV Table of Allotments" in TLJ Daily E-Mail Alert No. 1,473, October 23, 2006. This item is FCC 06-150 in MB Docket No. 87-268. See, notice in the Federal Register, November 15, 2006, Vol. 71, No. 220, at Pages 66591-66631.

Extended deadline to submit reply comments to the Federal Communications Commission (FCC) regarding the intercarrier compensation reform plan known at the Missoula Plan. This proceeding is titled "Developing a Unified Intercarrier Compensation Regime" and numbered CC Docket No. 01-92. See, notice in the Federal Register: September 13, 2006, Vol. 71, No. 177, at Pages 54008-54009, and extension notice in the Federal Register, December 6, 2006, Vol. 71, No. 234, at Pages 70709-70710.

The House will meet at 10:00 AM for legislative business. It will consider HR 4, a bill related to prescription drugs. See, House Majority Leader's weekly calendar [PDF].

12:15 - 1:45 PM. The Federal Communications Bar Association's (FCBA) Legislative and Mass Media Practice Committees will host a brown bag titled "Media Ownership Issues in the 110th Congress". For more information, contact Amy Levine at amy dot levine at mail dot house dot gov or 225-3861. Location: undisclosed.

2:30 PM. The National Science Foundation's (NSF) National Science Board's (NSB) Vannevar Bush Award Committee will hold a closed meeting. The NSB's web site states that this is awarded for "public service activities in science and technology". See, notice in the Federal Register, December 22, 2006, Vol. 71, No. 246, at Page 77071. Location: teleconference and NSF, 4201 Wilson Blvd., Arlington, VA.

5:00 PM. Deadline to submit requests to the Copyright Office (CO) to participate in the January 31, 2007, meeting of the Section 108 Study Group in Chicago, Illinois. See, 17 U.S.C. § 108 and notice in the Federal Register, December 4, 2006, Vol. 71, No. 232, at Pages 70434-70440.

EXTENDED FROM DECEMBER 15. Extended deadline to submit initial comments to the Federal Communications Commission (FCC) to assist the Wireless Telecommunications Bureau (WTB) in drafting a report on the ability of persons with hearing disabilities to access digital wireless telecommunications. This proceeding is WT Docket No. 06-203. See, original FCC Public Notice [4 pages in PDF] (DA 06-2285) and Public Notice (DA 06-2498) extending deadlines.

Martin Luther King's Birthday. The Federal Communications Commission (FCC) and other federal offices will be closed. See, Office of Personnel Management's (OPM) list of federal holidays and 5 U.S.C. § 6103. The National Press Club will be closed.

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