12/10. The House passed by unanimous consent, without discussion or debate, S 3663 [LOC | WW], the "Short-term Analog Flash and Emergency Readiness Act".

This bill provides an extension of authority to make analog television broadcasts for 30 days beyond the transition date of February 17, 2009, for "public safety information and digital transition information".

The Senate passed this bill on November 20, 2008. See, story titled "Senate Passes Bill to Allow Select Analog Broadcasts for 30 Days After DTV Transition" in TLJ Daily E-Mail Alert No. 1,862, November 24, 2008.

This bill is now ready for President Bush's signature.

12/10. The House passed HR 7321 [LOC | WW], the "The Auto Industry Financing and Restructuring Act", by a vote of 237-170. See, Roll Call No. 690.

This is a bill to bail out three mismanaged U.S. auto makers (GM, Ford and Chrysler) and impose further environmental constraints on them.

It was a largely partisan vote. Democrats voted 205-20. Republicans voted 32-150.

Rep. Steny Hoyer (D-MD), the House Majority Leader, spoke in the House. He asserted in his statement that this is not a "bridge loan to nowhere". He also said that this bill will make these three companies "greener".

12/10. The National Research Council (NRC) has put on sale a report titled "Review of the Federal Strategy for Nanotechnology-Related Environmental, Health, and Safety Research".

The NRC wrote in a release that there are "serious weaknesses in the government's plan for research on the potential health and environmental risks posed by nanomaterials, which are increasingly being used in consumer goods and industry."

Rep. Bart Gordon (D-TN), Chairman of the House Science Committee (HSC), responded in a release that "I share many of these concerns". He wrote that he supports legislation that would require the development of an environmental, health and safety (EHS) research plan for the federal government's nanotechnology initiative.

Rep. Gordon and others introduced HR 5940 [LOC | WW], the "National Nanotechnology Initiative Amendments Act of 2008", on May 1, 2008. The HSC approved this bill on June 4, 2008. The full House approved it on June 5, 2008. The Senate has not passed it.

Rep. Gordon, who has been re-elected HSC Chairman for the 111th Congress, added that he will seek passage of similar legislation in the next Congress, which starts in January.

He concluded that "The enormous promise of nanotechnology will not be achieved unless any potential risks of the technology are well understood through a thorough, transparent research process that will both protect the public health and allay any safety concerns."

12/10. Intel filed a complaint with a court in Korea seeking to set aside the June antitrust order of the Korea Fair Trade Commission (KFTC).

The KFTC imposed a corrective order on June 4, 2008. The KFTC released an English language document titled "Corrective measures against Intel's abuse of market dominance" on August 8, 2008. It states that "Intel leveraged its dominant market position in the CPU market to exclude its competitor AMD by providing various rebates to Samsung Electronics and Sambo Computer, No. 1 and No. 2 players of the local PC market respectively, conditional on them not buying CPUs from AMD."

The KFTC applied Article 3-2(5) of Monopoly Regulation and Fair Trade Act.

Ed Black, head of the Computer & Communications Industry Association (CCIA), stated in a release that "After losing on the merits of the case, Intel is now attacking legitimate government agencies which carefully weighed the balance of the evidence before finding this business practice violated antitrust laws. It is disappointing they are criticizing the investigators, rather than taking responsibility for the actions that have led to investigations around the world."

12/8. Whole Foods Markets filed a complaint [PDF] in U.S. District Court (DC) against the Federal Trade Commission (FTC) seeking an injunction of the FTC's administrative proceeding against Whole Foods. The FTC seeks to undo Whole Foods 2007 acquisition of Wild Oats Markets.

This matter does not involve technology. Whole Foods sells pricey fruits, vegetables and other groceries. However, this may be significant to technology companies.

This matter also goes to the procedures used by the FTC to block, or undo, mergers. These procedures apply to all mergers, including those involving technology related companies. If Whole Foods prevails, and obtains a precedential opinion that the FTC is not permitted to pursue that procedure that it now pursues, then this would limit the options available to the FTC.

What is at stake here is whether, and if so, under what circumstances, and pursuant to what procedure, the FTC can block mergers of technology companies (as well as other companies) by administrative orders, without having to obtain an order of the District Court.

There are two other federal agencies that exercise antitrust merger review authority in technology related transactions -- the Department of Justice's (DOJ) Antitrust Division, and the Federal Communications Commission (FCC). The DOJ, pursuant to its statutory authority, files actions in the District Court to block or condition mergers. The FCC acts administratively. It has no statutory authority to conduct antitrust merger reviews, and has slight regard for due process, but selects and conducts its proceedings in a manner that evades judicial review.

Whole Foods announced its plans to acquire Wild Oats almost two years ago. The FTC sought to block the merger. It filed a complaint in District Court seeking an injunction. The District Court refused to issue an injunction.

The District Court held that there is no distinct PNOS market. Rather, these are just two grocery store chains out of many competitors in the grocery store market. In August of 2007 the District Court issued an order [2 pages in PDF] and a redacted copy of its Memorandum Opinion [95 page PDF scan; 3.5 MB] denying the FTC's request for a preliminary injunction. The FTC sought an injunction pending appeal, which the Court of Appeals denied.

The two chains consummated their merger in August of 2007. Nevertheless, the FTC persisted.

On July 29, 2008, the U.S. Court of Appeals (DCCir) issued its redacted and divided opinion reversing the District Court. See, story titled "DC Circuit Reverses in FTC v. Whole Foods" in TLJ Daily E-Mail Alert No. 1,802, July 29, 2008. On November 21, 2008, the Court of Appeals issued a revised opinion [65 pages in PDF].

The FTC now seeks to undo the merger by administrative hearing and order. The FTC filed an amended complaint [11 pages in PDF] on September 8, 2008. It issued a scheduling order [14 pages in PDF] on September 10 that schedules the hearing in this matter for February 16, 2009.

In the just filed District Court complaint, Whole Foods has gone back to the court to assert that this administrative procedure violates both due process of law and the Administrative Procedure Act.

This is an new court case. However, it is brought in the same District Court as the FTC's earlier action. Also, it has been assigned to the same Judge, Paul Friedman, who rejected the FTC's theory and denied its injunction request in 2007.

Now, Whole Foods argues that the FTC has already prejudged Whole Foods, and cannot give it a fair hearing.

The complaint begins with a quote from the book [Amazon] titled "Alice in Wonderland":

" `Now for the evidence´, said the King, `and then the sentence.´
`No! said the Queen. `First the sentence, and then the evidence.´ "

The complaint states that the FTC already failed once to obtain an injunction from the District Court, and now, 18 months later, is "attempting to get a second bite at the apple by challenging this merger in administrative proceedings" conducted by the FTC.

The complaint continues that "To the extent this end-run around the independent federal courts is constitutionally sound at all, it is undeniable that Whole Foods is entitled to a fair and impartial proceeding that gives Whole Foods the ability to reasonably and adequately defend itself at trial."

The complaint enumerates numerous deficiencies with the process being afforded by the FTC. It alleges that the FTC has already prejudged the outcome before the administrative hearing, that the FTC is not allowing Whole Foods adequate pre-hearing discovery, that the FTC is not allowing Whole Foods adequate time to prepare for the hearing.

Whole Foods asks the District Court to terminate the FTC's administrative proceeding, and order the FTC to proceed with an action against Whole Foods in the District Court pursuant to Section 13(b) of the FTC Act.

Count I pleads violation of the due process clause of the 5th Amendment of the Constitution based on the FTC's prejudgment and bias. Count II pleads violation of due process based on an unreasonable scheduling order. Count III pleads violation of due process based on the FTC's failure to disqualify itself. Count IV pleads violation of due process based upon all of the above. Count V pleads violation of the Administrative Procedure Act based upon arbitrary and capricious conduct. Count VI seeks injunctive relief.

In November, after the Court of Appeals issued its revised opinion, David Wales, the acting Director of the FTC's Bureau of Competition, stated in an FTC release that opinion "reaffirms that the proper role of the district court in considering whether to grant the Commission's request for a preliminary injunction is limited to whether the case raises sufficiently serious and substantial issues so as to make them fair ground for litigation during the full trial on the merits in the administrative proceedings."

He continued that "Now that the appellate court has denied Whole Foods’ request for further review, we look forward to presenting our evidence as to why this merger is unlawful and should be undone at the plenary trial in a few months. We are also ready to address the public equities in further proceedings before the district court with the goal of preserving competition in the interim and ensuring that a meaningful remedy can be obtained."

The complaint was signed by Lanny Davis of the Washington DC office of the law firm of Orrick Herrington & Sutcliffe.

This case is Whole Foods Markets, Inc. v. FTC, U.S. District Court for the District of Columbia, D.C. No. 1:08-cv-02121, Judge Paul Friedman presiding.

12/2. The Federal Trade Commission (FTC) filed a civil complaint [21 pages in PDF; 7 MB] in U.S. District Court (DMd) against numerous defendants alleging violation of Section 5(a) of the FTC Act in connection with their fraudulent sale of scareware products.

Also on December 2, the District Court issued an ex parte temporary restraining order (TRO) [21 pages in PDF].

The defendants are Innovative Marketing, Inc., ByteHosting Internet Services, LLC, James Reno, Sam Jain, Daniel Sundin, Marc D'Souza, and Kristy Ross.

Section 5(a) of the FTC Act, which is codified at 15 U.S.C. § 45, provides in part that "Unfair methods of competition in or affecting commerce, and unfair or deceptive acts or practices in or affecting commerce, are hereby declared unlawful."

The complaint alleges that the defendants "operate a massive, Internet-based scheme that tricks consumers into purchasing computer security software. Known in Internet parlance as ``scareware,´´ Defendants' software -- and the misleading Internet advertising used to promote it -- exploits consumers' legitimate concerns about Internet-based threats like spyware and viruses by issuing false security or privacy warnings to consumers for the sole purpose of selling software to fix the imagined problem."

The complaint states that "The Defendants' scareware scheme relies on elaborate and technologically sophisticated Internet advertisements that Defendants place with advertising networks and many popular commercial websites. These exploitive ads display to consumers a ``system scan´´ that invariably detects on consumers' computers a host of malicious or otherwise dangerous files and programs, including viruses, spyware, or ``illegal´´ pornography."

"Once the scan is complete, the Defendants urge consumers to download and install their software to resolve the security or privacy problems detected by the scanner." Then, this "second, software-based, scan repeats many of the same warnings from the initial scan and urges consumers to purchase the Defendants' software at a cost of $39.95 or more to resolve the security or privacy issues found by the scanner."

But, the complaint alleges, "the scans displayed in the Defendants' Internet advertisements and by the Defendants' software are an elaborate ruse created to dupe consumers into purchasing the Defendants' security software products. Although the Defendants go to great lengths to make the scans appear legitimate, no actual computer scans take place and the purported virus, spyware, or illegal pornography purportedly detected by the Defendants' scanners does not exist on consumers' computers."

The complaint states that over one million consumers have purchased the defendants' software products.

This case is FTC v. Innovative Marketing, Inc. et al., U.S. District Court for the District of Maryland.

12/10. President elect Obama's transition office announced that former Sen. Tom Daschle (D-SD) would be nominated to be Secretary of Health and Human Services, and would be named Director of a new White House Office on Health Reform. This would give Daschle responsibility for several technology related topics, include digitization of medical records, and maintaining the privacy of personally identifiable health information. See, release.

12/10. President Bush announced his intent to nominate Matthew Friedrich to be Assistant Attorney General (AAG) in charge of the Department of Justice's (DOJ) Criminal Division. He is currently the acting AAG. The position requires Senate confirmation. He has worked for the DOJ since 1995. See, release.

12/10. Charles Boucher was named Chief Information Officer (CIO) and Director of the Office of Information Technology at the Securities and Exchange Commission (SEC). See, SEC release.

12/8. The Senate confirmed Neil Barofsky to be Special Inspector General for the Troubled Asset Relief Program. See, Congressional Record, December 8, 2008, at Page S10819

This issue contains the following items:
 • House Passes Limited Analog Broadcast Extension Bill
 • House Passes Auto Maker Bail Out Bill
 • Rep. Gordon Will Seek Passage of Nanotech Bill
 • Intel Challenges Korea FTC Order
 • Whole Foods Files Complaint Against FTC
 • FTC Shuts Down Scareware Sellers

The House will not meet. The House has adjourned until January 3, 2009, subject to recall by the Speaker of the House. See, HConRes 440.

The Senate will meet at 10:00 AM. It will consider HR 7005 [LOC | WW], the "Alternative Minimum Tax Relief Act of 2008".

8:30 AM - 3:00 PM. The Department of Commerce's (DOC) National Institute of Standards and Technology's (NIST) Malcolm Baldrige National Quality Award Board of Overseers will meet. See, notice in the Federal Register, November 28, 2008, Vol. 73, No. 230, at Page 72451. Location: NIST, Administration Building, Lecture Room B, Gaithersburg, MD.

9:00 - 10:30 AM. The Information Technology and Innovation Foundation (ITIF) will host an event to release and discuss a report titled "A Policymaker's Guide to Network Management". The speakers will be Robert Atkinson (ITIF), David Sohn (Center for Democracy and Technology), and George Ou (ITIF). A light breakfast will be served. Location: ITIF, Suite 200, 1250 Eye St., NW.

9:00 AM. The American Antitrust Institute (AAI) will host an event titled "Private Antitrust Enforcement Symposium". For more information, contact Sarah Frey at 202-408-7442. Location: Holeman Lounge, National Press Club,13th Floor, 529 14th St. NW.

9:30 AM. The Park City Center for Public Policy will hold a news conference titled "Defending Cyberspace: Recommendations for Action". For more information, contact Jim Souby at 435-649-6980 x100 or jsouby at parkcitycenter dot org. Location: Lisagor Room, National Press Club,13th Floor, 529 14th St. NW.

12:15 - 1:30 PM. The Federal Communications Bar Association's (FCBA) Engineering and Technical Practice Committee will host a brown bag lunch titled "The Harmful Interference Standard". The speakers will be Michael Marcus (Marcus Spectrum Solutions), Mitchell Lazarus (Fletcher Heald & Hildreth), Rick Engelman (Sprint Nextel), and Dean Brenner (Qualcomm). RSVP to Tami Smith at tsmith07 at sidley dot com or 202-736-8257. Location: Sidley Austin, 1501 K St., NW.

6:00 - 8:15 PM. The DC Bar Association (DCBA) will host part two of a two part event titled "2008 IP Law Year in Review Series". The speakers will be Bradley Wright (Banner & Witcoff) and Eric Wright (Morgan & Finnegan). The price to attend ranges from $80 to $115. For more information, contact 202-626-3488. See, notice. The DCBA has a record of excluding persons from its events. The event qualifies for continuing legal education credits. Location: DC Bar Conference Center, B-1 Level, 1250 H St., NW.

Deadline for the Office of the U.S. Trade Representative (OUSTR) to submit its annual report to the Congress on the People's Republic of China's compliance with the commitments made in connection with its accession to the World Trade Organization (WTO). This annual report is required by 22 U.S.C. § 6951.

Deadline to submit initial comments to the Office of the U.S. Trade Representative (OUSTR) regarding the operation, effectiveness, and implementation of and compliance with trade agreements regarding telecommunications products and services, including the World Trade Organization (WTO) General Agreement on Trade in Services, the North American Free Trade Agreement (NAFTA), free trade agreements (FTAs) with Australia, Bahrain, Chile, Morocco, and Singapore, the Dominican Republic-Central America-United States FTAs. See, notice in the Federal Register, November 25, 2008, Vol. 73, No. 228, at Page 71707-71708.

The House will not meet.

Deadline to submit comments to the Office of the U.S. Trade Representative (OUSTR) regarding the People's Republic of China's (PRC) complaint to the World Trade Organization (WTO) regarding Department of Commerce (DOC) anti-dumping and countervailing duty determinations and orders affecting imports from the PRC of steel pipe, tires, and other products. See, notice in the Federal Register, November 13, 2008, Vol. 73, No. 220, at Pages 67214-67215. In other WTO proceedings, the U.S., Japan, Taiwan, and other nations have complained to the WTO about the PRC's failure to protect intellectual property rights. See, story titled "US to Complain to WTO Regarding PR China's Failure to Protect IPR" in TLJ Daily E-Mail Alert No. 1,562, April 9, 2007, and story titled "US Requests WTO Dispute Settlement Panel Re PRC Failure to Protect IPR" in TLJ Daily E-Mail Alert No. 1,623, August 15, 2008. See also, the WTO's web page for DS362 and web page for DS363.

Deadline to submit comments to the National Institute of Standards and Technology's (NIST) Computer Security Division (CSD) regarding draft FIPS-186-3 [125 pages in PDF] titled "Digital Signature Standard (DSS)". See also, notice in the Federal Register, November 12, 2008, Vol. 73, No. 219, at Pages 66842-66844.

Deadline to submit nominations to the National Telecommunications and Information Administration (NTIA) for members of the NTIA's Online Safety and Technology Working Group (OSTWG) for a fifteen month term to commence in January of 2009. See, notice in the Federal Register, November 21, 2008, Vol. 73, No. 226, at Pages 70624-70625. See also, story titled "NTIA Seeks Members for Online Safety and Technology Working Group" in TLJ Daily E-Mail Alert No. 1,863, November 25, 2008.

9:00 AM - 1:00 PM. The U.S. Patent and Trademark Office's (USPTO) National Medal of Technology and Innovation Nomination Evaluation Committee will hold a closed meeting. See, notice in the Federal Register, November 28, 2008, Vol. 73, No. 230, at Page 72453. Location: USPTO, 600 Dulany St., Alexandria, VA.

2:00 - 3:15 PM. The National Governors Association (NGA) and Alliance for Public Technology (APT) will webcast an event titled "State Efforts to Expand Broadband Access". The speakers will be Michael Ramage (Connected Tennessee) and Karen Jackson (state of Virginia). See, notice.

Deadline to submit comments to the National Science Foundation's (NSF) National Coordination Office for Networking Information Technology Research and Development in response to its Request for Information (RFI) regarding "promising game-changing ideas with the potential to reduce vulnerabilities to cyber exploitations by altering the cybersecurity landscape". See, notice in the Federal Register, October 14, 2008, Vol. 73, No. 199, at Pages 60724-60726.

Deadline to submit reply comments to the Federal Communications Commission (FCC) in response to its Notice of Inquiry (NOI) regarding management and oversight of the Universal Service Fund (USF). The FCC adopted this NOI on August 15, 2008 and released the text [17 pages in PDF] on September 12, 2008. It is FCC 08-189 in WC Docket No. 05-195. See, notice in the Federal Register, October 14, 2008, Vol. 73, No. 199, at Pages 60689-60695.

Deadline to submit reply comments to the Federal Communications Commission (FCC) in response to the Notice of Proposed Rulemaking (NPRM) portion of its Memorandum Opinion and Order (MO&O) and NPRM regarding collecting and reporting of carrier service quality, customer satisfaction, and infrastructure and operating data. The FCC adopted and released this MO&O and NPRM [57 pages in PDF] on September 6, 2008. It is FCC 08-203 in WC Docket No. 08-190. See, notice in the Federal Register, October 15, 2008, Vol. 73, No. 200, at Pages 60997-61006. See also, story titled "FCC Grants Carriers Forbearance From ARMIS Reporting Rules" in TLJ Daily E-Mail Alert No. 1,822, September 8, 2008.

Deadline to submit initial comments to the Federal Communications Commission (FCC) regarding the National Telecommunications and Information Administration's (NTIA) petition for rulemaking [16 pages in PDF] requesting amendments to Part 87 of the FCC's Rules to allow use of the frequency 1090 MHz for runway vehicle identification and collision avoidance. See, Public Notice [3 pages in PDF]. This item is DA 08-2502 in RM 11503.

10:00 AM - 5:00 PM. The National Science Foundation's (NSF) Advisory Committee for Cyberinfrastructure will meet. See, notice in the Federal Register, November 13, 2008, Vol. 73, No. 220, at Page 67212. Location: NSF, Room 1235, 4201 Wilson Blvd., Arlington, VA.

12:00 - 1:30 PM. The DC Bar Association (DCBA) will host a panel discussion titled "CFIUS and FINSA: Comparisons With Other Countries' Investment Review Mechanisms". The speakers will be Johann Leaman (Department of Treasury), Michael Snarr (Baker Hostetler), Stephen Canner (U.S. Council for International Business), Matthew Edwards ( Department of Commerce). The price to attend ranges from $10 to $30. For more information, contact 202-626-3463. See, notice. The DCBA has a record of excluding persons from its events. Location: DC Bar Conference Center, B-1 Level, 1250 H St., NW.

12:30 - 2:00 PM. The Federal Communications Bar Association's (FCBA) International Telecommunications Practice Committee will host a brown bag lunch titled "Results of the 2008 Internet Governance Forum (IGF) in India and End of the Presidential Administration Telecoms Issues". The speaker will be David Gross (Department of State). For more information, contact Susan O'Connell at susan dot o'connell at fcc dot gov or Troy Tanner at troy dot tanner at bingham dot com. RSVP by December 12 to Jennifer Ullman at Jennifer dot ullman at verizon dot com. Location: Verizon, 5th floor, Suite 400 West, 1300 I St., NW.

Deadline to submit to the Federal Communications Commission (FCC) oppositions to the petition for reconsideration [PDF] filed on November 17, 2008, by the National Association of Broadcasters (NAB) and the Association for Maximum Service Television in the FCC's proceeding titled "In the Matter of Carriage of Digital Television Broadcast Signals: Amendment to Part 76 of the Commission's Rules" and numbered CS Docket No. 98-120. See, notice in the Federal Register, December 2, 2008, Vol. 73, No. 232, at Page 73327.

12:15 - 1:30 PM. The Federal Communications Bar Association's (FCBA) Young Lawyers Committee will host a brown bag lunch for planning purposes. For more information, contact Tarah Grant at tsgrant hhlaw dot com or 703-610-6155 or Cathy Hilke at chilke at wileyrein dot com or 202-719-7418. RSVP to Christy Hammond at chammond at wileyrein dot com. Location: Wiley Rein, 10 East Conference Center, 1750 K St., NW.

Effective date of the U.S. Patent and Trademark Office's (USPTO) new rules governing the conduct of individuals registered to practice before the USPTO. These new rules include an annual patent practitioner maintenance fee. See, notice in the Federal Register, November 17, 2008, Vol. 73, No. 222, at Pages 67750-67759.

? TIME? The Federal Communications Commission (FCC) may hold a meeting. Location?

5:00 PM. Deadline to submit to the National Telecommunications and Information Administration (NTIA) applications for planning and construction grants for public telecommunications facilities under the Public Telecommunications Facilities Program (PTFP). See, notice in the Federal Register, October 20, 2008, Vol. 73, No. 203, at Pages 62258-62259.

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