3/26. The Supreme Court of the United States (SCUS) granted certiorari in Stoneridge Investment v. Scientific-Atlanta, a securities fraud case involving the purchase of stock in Charter Communications, a cable television provider. At issue is the liability of secondary of actors Scientific Atlanta and Motorola, which had entered into contracts with Charter. See, order list [10 pages in PDF] at page 2.

The plaintiff in the District Court, appellant to the Court of Appeals, and petitioner to the SCUS is Stoneridge Investment Partners.

Stoneridge filed a complaint in U.S. District Court (EDMo) against Charter Communications, Scientific-Atlanta, Inc., Motorola, Inc., and others alleging Section 10b securities fraud. Scientific Atlanta and Motorola were equipment vendors to Charter.

Stoneridge alleged that Charter engaged in a pervasive and continuous fraudulent scheme intended to artificially boost its reported financial results by deliberately delaying the disconnecting of customers no longer paying their bills, improperly capitalizing labor costs, and entering into sham transactions with the two equipment vendors that improperly inflated Charter's reported operating revenues and cash flow.

The District Court dismissed the Section 10b claims against Scientific Atlanta and Motorola, relying on the 1994 SCUS opinion in Central Bank of Denver v. First Interstate Bank of Denver. The U.S. Court of Appeals (8thCir) affirmed. See, April 11, 2006, opinion [PDF], which is also reported at 443 F3d 987

The question presented [PDF] to the SCUS is "Whether this Court’s decision in Central Bank, N.A. v. First Interstate Bank, N.A., 511 U.S. 164 (1994), forecloses claims for deceptive conduct under § 10(b) of the Securities Exchange Act of 1934, 15 U.S.C. § 78j(b), and Rule 10b-5(a) and (c), 17 C.F.R. 240.l0b-5(a) and (c), where Respondents engaged in transactions with a public corporation with no legitimate business or economic purpose except to inflate artificially the public corporation’s financial statements, but where Respondents themselves made no public statements concerning those transactions."

The Supreme Court added that Chief Justice Roberts and Justice Breyer took no part in the decision to grant certiorari.

This case is Stoneridge Investment Partners, LLC v. Scientific-Atlanta, Inc., et al., Sup. Ct. No. 06-43, a petition for writ of certiorari to the U.S. Court of Appeals for the 8th Circuit, App. Ct. No. 05-1974. The Court of Appeals heard an appeal from the U.S. District Court for the Eastern District of Missouri. See also, Supreme Court docket.

3/27. The Federal Communications Commission (FCC) released the text [19 pages in PDF] of its Notice of Proposed Rulemaking (NPRM) regarding FCC regulation of exclusive contracts for the provision of video services to multiple dwelling units (MDUs) and other real estate developments.

The FCC adopted, but did not release, this NPRM on March 22, 2007. See, story titled "FCC Adopts MDU Forced Access NPRM" in TLJ Daily E-Mail Alert No. 1,556, March 26, 2007.

This NPRM states that "We tentatively conclude that the Commission has authority to regulate exclusive contracts for the provision of video services to MDUs or other real estate developments where we find that such contracts may impede competition and impair deployment of those services."

The NPRM seeks comments on these exclusive contracts, and "how we should regulate such contracts."

This NPRM also seeks comment on the FCC's authority to engage in such regulation. It identifies the statutory sections that may provide such authority -- Sections 623 and 706, as well as 1, 4(i) and 303(r), of the Communications Act.

Subsection 623(b), which is codified at 47 U.S.C. § 548(b), provides that "It shall be unlawful for a cable operator, a satellite cable programming vendor in which a cable operator has an attributable interest, or a satellite broadcast programming vendor to engage in unfair methods of competition or unfair or deceptive acts or practices, the purpose or effect of which is to hinder significantly or to prevent any multichannel video programming distributor from providing satellite cable programming or satellite broadcast programming to subscribers or consumers." Section 623(c) gives the FCC authority to write implementing regulations.

Section 706, which is codified at 47 U.S.C. § 157, note, states that the FCC and state regulators "shall encourage the deployment on a reasonable and timely basis of advanced telecommunications capability to all Americans (including, in particular, elementary and secondary schools and classrooms) by utilizing, in a manner consistent with the public interest, convenience, and necessity, price cap regulation, regulatory forbearance, measures that promote competition in the local telecommunications market, or other regulating methods that remove barriers to infrastructure investment."

It also gives the FCC authority to conduct inquiries. It adds that if the determination of such an inquiry is negative, then the FCC "shall take immediate action to accelerate deployment of such capability by removing barriers to infrastructure investment and by promoting competition in the telecommunications market."

47 U.S.C. at §§ 151 and 154(i) state in brief and general terms the purpose of the FCC. 47 U.S.C. § 543 pertains to the regulation of cable rates.

None of these provisions give the FCC sectoral regulatory authority over real estate owners.

This NPRM also sets comment deadlines. The deadline to submit initial comments is June 18, 2007. The deadline to submit reply comments is July 18, 2007.

This NPRM is FCC 07-33 in Docket 07-51.

3/26. The Federal Communications Commission (FCC) released the text [181 pages in PDF] of a document titled "Memorandum Opinion and Order" (MO&O) that approves, and imposes conditions upon, the merger of AT&T and BellSouth. The FCC simultaneously released a second document [5 pages in PDF] titled "Order on Reconsideration" (OR).

On December 29, 2006, the FCC asserted that it adopted this MO&O in concept. However, it did not then release any MO&O. See, story titled "FCC to Approve AT&T BellSouth Merger with Conditions" in TLJ Daily E-Mail Alert No. 1,512, January 2, 2007. This just released OR modifies this heretofore non-existent MO&O.

This OR states that the FCC acted "sua sponte" in issuing this OR. However, it addresses and responds to filings by Verizon, Qwest and AT&T. The OR also states that the conditions imposed by the MO&O and OR are "voluntary".

The OR states that "we revise Special Access Condition 6 in two salient respects. First, we require AT&T post-merger to comply with the pricing obligations of Special Access Condition 6 regardless of the pricing decisions of other incumbent local exchange carriers (LECs). Second, we reduce the duration of Special Access Condition 6 from 48 months to 39 months."

The OR elaborates that Special Access Condition 6 "sets a cap for the prices, terms and conditions at which AT&T may offer DS1 and DS3 channel termination services, DS1 and DS3 mileage services, and Ethernet services."

It states that under the December 29 concept MO&O "the cap would not apply to AT&T’s provision of such services to other price cap incumbent LECs or their affiliates that had obtained Phase II pricing flexibility for price cap services unless the other incumbent LEC offered comparable discounts for its own DS1, DS3 and price cap Ethernet services in Metropolitan Statistical Areas where it has received Phase II pricing flexibility and reciprocal discounts for Ethernet services offered outside of price cap regulation".

The OR eliminates this reciprocity limitation. The OR continues that "by eliminating the Reciprocity Limitation, AT&T will be required to extend the discount set forth in Special Access Condition 6 to all of its customers of DS1 and DS3 channel termination services, DS1 and DS3 mileage services, and Ethernet services, which should result in lower prices for many more end users."

It adds that "In light of the expanded application of Special Access Condition 6, we believe it is appropriate to shorten the time period under which Special Access Condition 6 applies to 39 months."

The MO&O is FCC 06-189 in WC Docket No. 06-74. The OR is FCC 07-44.

3/26. Freeconference.com, Inc. filed a complaint in U.S. District Court (DC) against AT&T alleging violation of federal antitrust law and the Communications Act in connection with AT&T's alleged blocking of calls to FreeConference, and AT&T's alleged termination of access fees from local exchange carriers (LECs) to which FreeConference is a subscriber.

The complaint alleges that "certain of its customers using Cingular cellular telephone service" are "unable to reach and join their teleconferences on certain telephone numbers assigned to" FreeConference. It further alleges that these calls "are being blocked by Cingular".

The complaint also alleges that AT&T has "suspended payments of terminating access fees to certain LECs, including at least one (1) LEC that provides local exchange services and assigned telephone numbers" to FreeConference.

The complaint adds that "AT&T's blocking of specific telephone numbers assigned to and used by one or more specific business subscribers and its suspension of payment of terminating access fees to particular LECs is not authorized by any state or federal statute or court decision or by any state or federal regulatory authority or justified by any applicable law or regulation."

Count I of the complaint alleges monopolization and monopoly maintenance in violation of Section 2 of the Sherman Act, 15 U.S.C. § 2.

Count II seeks relief under 47 U.S.C. § 406 for alleged violations of  47 U.S.C. §§ 201(a)&(b) and 202.

Section 201(a) provides in part that  "It shall be the duty of every common carrier engaged in interstate or foreign communication by wire or radio to furnish such communication service upon reasonable request therefor ..."

Section 201(b) provides in part that "All charges, practices, classifications, and regulations for and in connection with such communication service, shall be just and reasonable, and any such charge, practice, classification, or regulation that is unjust or unreasonable is declared to be unlawful ..."

Section 202 provides in part that "It shall be unlawful for any common carrier to make any unjust or unreasonable discrimination in charges, practices, classifications, regulations, facilities, or services for or in connection with like communication service, directly or indirectly, by any means or device, or to make or give any undue or unreasonable preference or advantage to any particular person, class of persons, or locality, or to subject any particular person, class of persons, or locality to any undue or unreasonable prejudice or disadvantage".

Then, Section 406 provides, in part, that "The district courts of the United States shall have jurisdiction upon the relation of any person alleging any violation, by a carrier subject to this chapter, of any of the provisions of this chapter which prevent the relator from receiving service in interstate or foreign communication by wire or radio, or in interstate or foreign transmission of energy by radio, from said carrier at the same charges, or upon terms or conditions as favorable as those given by said carrier for like communication or transmission under similar conditions to any other person, to issue a writ or writs of mandamus against said carrier commanding such carrier to furnish facilities for such communication or transmission to the party applying for the writ ..."

Count III seeks damages under 47 U.S.C. § 207. Count IV seeks a permanent injunction.

This case is Freeconference.com, Inc.v. AT&T, Inc., et al., U.S. District Court of the District of Columbia, D.C. No. 1:07-cv-00574, Judge Paul Friedman presiding.

FreeConference is represented by John Schryber and Jonathan Rubin of the Washington DC office of the law firm of Patton Boggs.

3/27. The Department of Justice (DOJ) announced that a grand jury of the U.S. District Court (WDVa), Roanoke Division, returned an indictment that charges ITT Corporation with violation of the federal export control regime. The DOJ also announced that ITT agreed to plead guilty and pay a fine of $100 Million. ITT did not physically export the underlying product, night vision equipment. Rather, it transferred data outside of the U.S. without a license, and omitted information from its export reports. The DOJ stated in a release that "ITT Corporation exported or caused to be exported defense-related technical data to the People’s Republic of China, Singapore, and the United Kingdom without having first obtained a license or written authorization from the U.S. Department of State. The technical data included information about a laser counter measure known as a ``light interference filter´´ for military night vision goggle systems." U.S. Attorney John Brownlee added in this release that this will "send a clear message that any corporation who unlawfully sends classified or export-controlled material overseas will be prosecuted and punished."

3/27. The Federal Communications Commission (FCC) announced in its web site that "The FCC website and related electronic filing systems and documents will be unavailable between 9:00 pm EDT Friday, March 30 and 6:00 am EDT Monday, April 2 for scheduled maintenance."

3/27. The Senate Judiciary Committee (SJC) held a hearing titled "Oversight of the Federal Bureau of Investigation". See, opening statement of Sen. Patrick Leahy (D-VT) and prepared testimony of FBI Director Robert Mueller, addressing the use of national security letters (NSLs).

The House will meet at 10:00 AM for legislative business. See, Rep. Hoyer's weekly calendar [PDF].

9:30 AM - 12:00 NOON. The Department of Justice's (DOJ) Antitrust Division and the Federal Trade Commission (FTC) will hold another in their series of joint hearings on single firm conduct. This hearing is titled "The Objectives and Goals of Remedies in Section 2 Cases". The speakers will be Robert Crandall (Brookings Institution), David Heiner (Microsoft), Per Hellström (European Commission's Directorate General for Competition), Abbott Lipsky (Latham & Watkins). Location: FTC, Room 432, 600 Pennsylvania Ave., NW.

10:00 AM. The Supreme Court of the United States (SCUS) will hear oral argument in Tellabs v. Makor Issues & Rights, a case regarding the scienter requirements of the Private Securities Litigations Reform Act (PSLRA). See, story titled "Supreme Court Grants Certiorari in PSLRA Case Regarding Pleading of Scienter" in TLJ Daily E-Mail Alert No. 1,515, January 8, 2007. See, SCUS calendar [PDF] and docket. This case is Sup. Ct. No. 06-484.

10:00 AM. The House Commerce Committee's (HCC) Subcommittee on Telecommunications and the Internet will hold a hearing titled "Status of the Digital Television Transition". The witnesses will be James Yager (Barrington Broadcasting Co.), Glenn Britt (Time Warner Cable), Mary Fetchet (Voices of September 11th), Alex Nogales (National Hispanic Media Coalition), John Taylor (LG Electronics USA), and Michael Vitelli (Best Buy). Location: Room 2123, Rayburn Building.

10:00 AM - 12:00 NOON. The House Science Committee will meet to mark up several items, including HR 362, a bill pertaining to science, technology, engineering, and mathematics (STEM) education. Location: Room 2318, Rayburn Building.

10:00 AM. The Senate Finance Committee (SFC) will hold a hearing titled "Risks and Reform: The Role of Currency in the U.S.-China Relationship". See, notice. Location: Room 215, Dirsksen Building.

10:00 AM. The House Foreign Affairs Committee's Subcommittee on Terrorism, Nonproliferation, and Trade will hold a hearing titled "Trade, Foreign Policy and the American Worker". The witnesses will include Lou Dobbs (CNN), Carla Hills, Scott Paul (Alliance for American Manufacturing), Thea Lee (AFL-CIO), and Yvette Lopes (Teamsters). See, notice. Location: Room 2172, Rayburn Building.

1:30 PM - 4:30 PM. The Department of Justice's (DOJ) Antitrust Division and the Federal Trade Commission (FTC) will hold another in their series of joint hearings on single firm conduct. This hearing is titled "Structural Versus Conduct Remedies". The speakers will be Richard Epstein (University of Chicago Law School), Franklin Fisher (Massachusetts Institute of Technology), Andrew Joskow (NERA Economic Consulting), Dietrich Kleemann (European Commission’s Directorate General for Competition), and John Thorne (Verizon). Location: FTC, Room 432, 600 Pennsylvania Ave., NW.

6:00 - 8:15 PM. The Federal Communications Bar Association (FCBA) will host a continuing legal education (CLE) seminar titled "Internet Freedom". The speakers will be David Gross (Department of State) and David Wu (Columbia University). The deadline to register is 5:00 PM on March 26. Prices vary. Location: Wiley Rein, 1776 K St., NW.

Day two of a three day conference hosted by the National Institute of Standards and Technology (NIST) and others titled "International Conference on Frontiers of Characterization and Metrology for Nanoelectronics". See, notice. The deadline to register is March 8, 2007. Location: NIST, Red Auditorium, 100 Bureau Drive, Gaithersburg, MD.

The House will meet at 10:00 AM for legislative business. See, Rep. Hoyer's weekly calendar [PDF].

9:00 AM - 5:00 PM. The National Aeronautics and Space Administration's (NASA) National Space-Based Positioning, Navigation, and Timing (PNT) Advisory Board will meet. See, notice in the Federal Register, March 13, 2007, Vol. 72, No. 48, at Page 11381. Location: Polaris Suite, Ronald Reagan Building and International Trade Center, 1300 Pennsylvania Ave., NW.

9:30 AM - 12:30 PM. The Department of Justice's (DOJ) Antitrust Division and the Federal Trade Commission (FTC) will hold another in their series of joint hearings on single firm conduct. This hearing is titled "Remedy in the Face of Technological Change". The speakers will be Michael Cunningham (Red Hat Inc.), Renata Hesse (Wilson Sonsini Goodrich & Rosati), Marina Lao (Seton Hall Law School), William Page (University of Florida's Levin College of Law), and Howard Shelanski (UC Berkeley law school). Location: FTC, Room 432, 600 Pennsylvania Ave., NW.

11:30 AM - 1:00 PM. The International Association of Privacy Professionals (IAPP) will host a lunch. The speaker will be Hugo Teufel, Chief Privacy Officer of the Department of Homeland Security (DHS). The IAPP states that this event is restricted to IAPP Members and TRUSTe Seal holders. The DHS states that this event is "OPEN PRESS". Location: Wiley Rein, 1776 K St., NW.

12:30 - 2:00 PM. The Federal Communications Bar Association's (FCBA) Communications Law, Copyright, and Digital Rights Management Committee will host a brown bag lunch titled "What's New at the Copyright Office". The speaker will be Marybeth Peters (Register of Copyrights). For more information, contact Ben Golant at bgol at loc dot gov or 202-707-9127. Location: National Association of Broadcasters, 1771 N Street, NW.

2:00 PM. The Senate Judiciary Committee (SJC) may hold a business meeting. The agenda includes consideration of S 236, the "Federal Agency Data Mining Reporting Act of 2007". This bill has been on many prior agendas. The SJC rarely follows its published agendas. Press contract: Tracy Schmaler (Leahy) at 202-224-2154 or Courtney Boone (Specter) at Courtney_Boone at judiciary-rep dot senate dot gov or 202-224-2984. See, notice. Location: Room 226, Dirksen Building.

2:00 PM. The House Appropriations Committee's Subcommittee on Commerce, Justice & Science will hold a hearing on the Office of the U.S. Trade Representative and the U.S. International Trade Commission. Location: Room H-309, Capitol Building.

2:00 - 3:00 PM. The President's National Security Telecommunications Advisory Committee (NSTAC) will hold a partially closed meeting by teleconference. See, notice in the Federal Register, December 29, 2006, Vol. 71, No. 250, at Page 78451, and notice in the Federal Register, March 15, 2007, Vol. 72, No. 50, at Pages 12179-12180. The open portion of the meeting pertains to the NSTAC's International Task Force (ITF). The closed portion of the meeting pertains to Global Infrastructure Resiliency (GIR).

2:00 - 4:00 PM. The Department of State's (DOS) International Telecommunication Advisory Committee (ITAC) will meet to prepare advice for the meeting of the Telecommunication Development Advisory Group (TDAG). See, notice in the Federal Register: February 12, 2007, Vol. 72, No. 28, at Pages 6640-6641. Location: DOS, Room 2533A.

6:30 - 8:30 PM. The Federal Communications Bar Association's (FCBA) Young Lawyers Committee will host an event titled "Happy Hour". For more information, contact Natalie Roisman at nroisman at akingump dot com or Chris Fedeli at chrisfedeli at dwt dot com. Location: The Bar at Morton's, 1050 Connecticut Ave., NW.

Day three of a three day conference hosted by the National Institute of Standards and Technology (NIST) and others titled "International Conference on Frontiers of Characterization and Metrology for Nanoelectronics". See, notice. The deadline to register is March 8, 2007. Location: NIST, Red Auditorium, 100 Bureau Drive, Gaithersburg, MD.

Rep. Hoyer's weekly calendar [PDF] states that "no votes are expected in the House".

9:00 AM - 1:00 PM. The National Aeronautics and Space Administration's (NASA) National Space-Based Positioning, Navigation, and Timing (PNT) Advisory Board will meet. See, notice in the Federal Register, March 13, 2007, Vol. 72, No. 48, at Page 11381. Location: Polaris Suite, Ronald Reagan Building and International Trade Center, 1300 Pennsylvania Ave., NW.

TIME? The Department of State's (DOS) International Telecommunication Advisory Committee (ITAC) will meet by teleconference to prepare for ITU-T Study Groups 11, 13, and 19. See, notice in the Federal Register, February 12, 2007, Vol. 72, No. 28, at Pages 6640-6641.

Effective date of the Securities and Exchange Commission's (SEC)rule [119 pages in PDF] regarding voluntary internet availability of proxy materials. See, notice in the Federal Register, January 29, 2007, Vol. 72, No. 18, at Pages 4147-4173. See also, story titled "SEC Adopts E-Proxy Rule Changes" in TLJ Daily E-Mail Alert No. 1,506, December 15, 2006.

Deadline to submit comments to the Securities and Exchange Commission (SEC) in response to it proposal to make mandatory internet availability of proxy materials. See, notice in the Federal Register, January 29, 2007, Vol. 72, No. 18, at Pages 4175-4188. See also, story titled "SEC Seeks Comments on Proposal to Mandate Internet Availability of Proxy Materials" in TLJ Daily E-Mail Alert No. 1,529, January 30, 2007.

Deadline for the Office of the U.S. Trade Representative to submit its annual report, as required by Section 1377 of the Omnibus Trade and Competitiveness Act of 1988, which is codified at 19 U.S.C. § 3106, regarding the operation, implementation and effectiveness of all trade agreements regarding telecommunications products and services. See, notice in the Federal Register, November 15, 2006, Vol. 71, No. 220, at Pages 66563-66564.

The House will not meet. See, House 2007 calendar.

The Senate will not meet. See, Senate 2007 calendar.

Passover begins at sundown.

Deadline to submit comments to the Federal Acquisition Regulation (FAR) Secretariat regarding its proposal to amend the FAR to delete references to the Federal Acquisition Computer Network (FACNET). See, notice in the Federal Register, February 1, 2007, Vol. 72, No. 21, at Pages 4675-4676.

Passover.

10:00 AM. The U.S. Court of Appeals (FedCir) will hear oral argument in Translogic Technology v. Hitachi, App. Ct. No. 2005-1387, and In Re Translogic Technology, App. Ct. No. 2006-1192. Location: Courtroom 203, 717 Madison Place, NW.

10:00 AM. The U.S. Court of Appeals (FedCir) will hear oral argument in Advanced Technology Materials v. Praxair, App. Ct. No. 2006-1540, a patent case involving semiconductor manufacturing technology. Location: Courtroom 203, 717 Madison Place, NW.

2:00 PM. The U.S. Court of Appeals (FedCir) will hear oral argument in UTStarcom v. Starent Networks, App. Ct. No. 2006-1295, an appeal from the U.S. District Court (NDCal) in a patent case involving technology for networking equipment that enables mobile data communications. Location: Courtroom 201, 717 Madison Place, NW.

Tech Law Journal publishes a free access web site and subscription e-mail alert. The basic rate for a subscription to the TLJ Daily E-Mail Alert is $250 per year. However, there are discounts for subscribers with multiple recipients. Free one month trial subscriptions are available. Also, free subscriptions are available for journalists, federal elected officials, and employees of the Congress, courts, and executive branch. The TLJ web site is free access. However, copies of the TLJ Daily E-Mail Alert are not published in the web site until one month after writing. See, subscription information page.

Contact: 202-364-8882.
P.O. Box 4851, Washington DC, 20008.

Privacy Policy
Notices & Disclaimers
Copyright 1998 - 2007 David Carney, dba Tech Law Journal. All rights reserved.