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Friday, January 13, 2012, Alert No. 2,326.
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Genachowski Addresses Incentive Auctions and Unlicensed Spectrum

1/11. Federal Communications Commission (FCC) Chairman Julius Genachowski gave a speech at the Consumer Electronics Show (CES) in Las Vegas in which he addressed legislation to give the FCC incentive auction authority.

An incentive auction would provide for the sharing of spectrum auction proceeds with the licensees who voluntarily relinquish that spectrum. It would provide a financial incentive for television broadcasters and other licensees to relinquish some of their spectrum.

Julius GenachowskiWhile there is broad support for the concept, there are many hotly debated issues regarding how to structure a regime for incentive auctions, as well as related matters. Genachowski (at left) engaged in legislative advocacy, and criticized components of some pending bills.

There are bills in both the House and Senate. One bill is drafted and backed by House Commerce Committee (HCC) Republicans. Another is drafted and backed by HCC Democrats. A third is a Senate Commerce Committee (SCC) bill. There are others.

Republicans hold a majority in the House, and the HCC. On December 1, 2011, the HCC's Subcommittee on Communications and Technology approved, over opposition from some Democrats, a discussion draft [113 pages in PDF] of the "Jumpstarting Opportunity with Broadband Spectrum Act of 2011" or "JOBS Act of 2011". This bill would create incentive auction authority. See, story titled "House Communications Subcommittee Approves Spectrum Bill" in TLJ Daily E-Mail Alert No. 2,317, December 1, 2011, for summaries of, and hyperlinks to, amendments approved at that meeting.

See also, story titled "House Commerce Committee Democrats Seek Delay of Spectrum Bill Mark Up" in TLJ Daily E-Mail Alert No. 2,316, November 30, 2011. In addition, this discussion draft was included as Title IV of HR 3630, which the House passed on December 13, 2011. However, this spectrum bill has not been enacted into law.

The HCC Democrats have a competing spectrum bill, HR 3509 [LOC | WW], the "Wireless Innovation and Public Safety Act of 2011".

HCC Republicans and Democrats diverge on several issues, including allowing the FCC to allocate for unlicensed use spectrum that is currently held by TV broadcasters, and that would be acquired pursuant to incentive auction authority.

Democrats hold a majority in the Senate, and the SCC. On June 8, 2011, the SCC approved, over opposition from some Republicans, its bill, S 911 [LOC | WW], the "Strengthening Public-safety and Enhancing Communications Through Reform, Utilization, and Modernization Act" or "SPECTRUM Act". (The Library of Congress has not yet published a copy of the bill as amended.)

Genachowski praised the SCC bill, praised components of the House Democrats' bill, and criticized components of the House Republicans' bill.

It was a political speech in which Genachowski departed from the idealized notion that the FCC is an expert, independent and non-political agency that merely implements the statutory directives of the Congress. He publicly took sides in an ongoing legislative debate.

Genachowski said that "the incentive auction concept needs to become law now".

He said the the SCC passed its bill "in a manner that would give the FCC sufficient flexibility to conduct incentive auctions in a way that would generate massive value. And the Senate Commerce bill also provided essential funding to fulfill a vital 9/11 Commission recommendation that we build an interoperable mobile broadband network for first responders."

All three bills would provide for an interoperable mobile broadband network for first responders. They differ in the details.

Genachowski continued that "the sticking points are proposals that would pre-empt the FCC's open, fact-based process and predetermine spectrum allocation and auction design in an unprecedented manner. One proposal would prohibit the FCC from allocating any recovered spectrum to innovative unlicensed use; another would eliminate traditional FCC tools for setting terms for participation in auctions."

He argued that Congressional legislation should not "prejudge or micromanage FCC auction design and band plans".

Genachowski offered an idealized vision of the FCC. He argued that such legislation "preempts an expert agency process that's fact-based, data-driven and informed". He asserted that the FCC possesses "technical expertise", and makes decisions "based on the evidence, on an open record", and in a timely manner.

Genachowski continued in his Las Vegas speech that "the proposal to prevent the FCC from designating any new spectrum for unlicensed use risks suppressing major innovation of the sort that gave us Wi-Fi."

He said that "Wi-Fi as an unlicensed innovation has gone from something that wireless carriers opposed and that wireless devices didn’t accommodate, to something that wireless carriers embrace as indispensible to their networks; and indeed, in a reversal from the norm for mobile phones where cellular networks have been the default and Wi-Fi the option, tablets today have Wi-Fi as the default and cellular networks as the option. We shouldn't ignore the lessons of history and close the door to consideration of new wireless platforms for innovation."

Genachowski also associated himself with a January 9 letter on this subject signed by four Senators. See, related story in this issue titled "Four Senators Advocate Use of Incentive Auction Process for Allocating Spectrum for Unlicensed Use"

Next, Genachowski addressed his opposition to "the proposal to prohibit the agency from imposing eligibility conditions on auction participants" by quoting extensively from the four Senators' letter.

One counterargument to Genachowski would be that in some previous auctions, FCC imposed eligibility conditions drove off some prospective bidders, and decreased auction revenues.

He also predicted that "Congress will make a decision on incentive auctions by March 1."

Four Senators Advocate Use of Incentive Auction Process for Allocating Spectrum for Unlicensed Use

1/9. Sen. John Kerry (D-MA), Sen. Olympia Snowe (R-ME), Sen. Mark Warner (D-VA), and Sen. Jerry Moran (R-KS) wrote a letter to Senate leaders in which they argued that spectrum legislation should provide for a incentive auction process that would also give the Federal Communications Commission (FCC) authority to allocate spectrum for unlicensed use.

They wrote that "Our first concern is whether or not the FCC should set aside some spectrum in certain bands for unlicensed use. We believe the FCC should be afforded some discretion to make this decision".

They added, without specifically referencing the House Commerce Committee (HCC) bill, that "Unfortunately, a proposal currently being considered prohibits the FCC from allocating spectrum cleared in the broadcast bands for unlicensed use."

They elaborated that "It may be that the spectrum cleared is best left for licensed use, but Congress should defer to the FCC to make the proper determination of optimizing the allocation of spectrum given the dynamic nature of the industry and wireless technologies."

In addition, they wrote that they have concerns about "proposals to limit the FCC's authority to carefully design future spectrum auctions. Some have proposed prohibiting the agency from imposing eligibility conditions on auction participants. While at first this may seem appropriate to ensure an open auction where all can take part and would be in a market with perfect competition, upon closer examination this could have a deterring effect on fostering competition and maximizing auction proceeds to pay for a public safety network and deficit reduction."

They concluded that "Maintaining the FCC’s current range of tools for structuring a spectrum auction, as prescribed by the statute, provides the agency with the requisite flexibility to attract a sufficient number of bidders to ensure the competitive bidding necessary to maximize auction revenues and that the market for spectrum remains competitive for companies of all sizes."

Commentary on FCC Spectrum Discretion

1/11. Federal Communications Commission (FCC) Chairman Julius Genachowski gave a speech at the Consumer Electronics Show (CES) in Las Vegas in which he offered an idealized vision of the FCC.

The main purpose his speech was to take sides in ongoing Congressional debates regarding incentive auction legislation. See, related story in this issue titled "Genachowski Addresses Incentive Auctions and Unlicensed Spectrum".

He argued, in effect, that the Congress should reject language in the House Republicans' incentive auction bill that would limit FCC discretion regarding allocation of spectrum for unlicensed uses, and regarding auction eligibility conditions.

He argued that such legislation "preempts an expert agency process that's fact-based, data-driven and informed". He asserted that the FCC possesses "technical expertise", and makes decisions "based on the evidence, on an open record", and in a timely manner.

And for these reasons, the FCC Chairman argued, it should be granted broad discretion with respect to spectrum auctions and allocations.

There exists another vision of the nature of FCC processes -- that it is an agency comprised of, and run by lawyers; that its is dependent upon information and analysis provided to it by interested companies and trade groups; that it is frequently influenced by political pressure from the Congress and President; and that is has limited commitments to transparent processes, Congressional statutes, and timely decision making.

In addition, when certain members of Congress back legislation that would give the FCC broad discretion, it is not necessarily because they hold an idealized vision of the FCC as an independent expert agency. Rather, it is sometimes because they hold an alternative vision of the FCC as an agency that is subject to pressure and manipulation from the Congress, and they look forward to exerting such influence over FCC decision making in the future.

Moreover, in recent years, Genachowski has often disregarded House Republicans, but not House Democrats, in key proceedings. Hence, some House Republicans have developed a tendency to support legislation that limits FCC discretion.

Harper Collins Sues Open Media Over E-Book Distribution

12/23. HarperCollins filed a complaint in the U.S. District Court (SDNY) against Open Road Integrated Media alleging copyright infringement in connection the copying and distribution of an ebook version of the children's book titled "Julie of the Wolves".

The complaint alleges that HarperCollins holds the rights to this book, including ebook rights, and that Open Road is distributing it in electronic format to various web sites for sale to the public, including Amazon.com, Apple, BN.com, Kobo Books, and Sony Reader Store. See for example, Amazon Kindle web page for this book. Amazon sells its Kindle download of this book for $5.69.

HarperCollins pleads one count of copyright infringement under 17 U.S.C. § 106.

HarperCollins seeks a declaration that Open Road is infringing its copyright, an injunction against copying, advertising, or distributing, statutory or actual damages as HarperCollins elects, profits earned by Open Road, and costs and attorney's fees.

The book at issue was first published in 1972. Harper Collins' complaint states that its agreement with the author grants it the exclusive right to publish the book "in book form," including via "computer, computer-stored, mechanical or other electronic means now known or hereafter invented."

People and Appointments

1/4. David Mao was named Law Librarian of Congress and Roberta Shaffer was named Associate Librarian for Library Services.

1/3. Bradley Gillen joined the law firm of Wilkinson Barker Knauer as a partner in its Washington DC office. He was previously Special Counsel to the Chief of the Federal Communications Commission's (FCC) Wireline Competition Bureau (WCB). He worked on reform of the FCC's Universal Service Fund. Before that, he was a Legal Advisor to former FCC Commissioner Meredith Baker for wireline, broadband, and media issues. Before joining the FCC, he worked for the DISH Network. And before that, he worked for the law firm of Wiley Rein.

12/30. David Fiske retired from the Federal Communications Commmission (FCC). He was Deputy Director of the Office of Media Relations (OMR). Tammy Sun joined the FCC as Director in April of 2011. Before then, Fiske had been the long time Director of the OMR. Neil Grace remains Chairman Julius Genachowski's personal Press Secretary. Fiske can be reached at davidfiske17 at gmail dot com. He worked at the FCC for 17 years.

12/27. Albert Tramposch joined the American Intellectual Property Law Association (AIPLA) as Deputy Executive Director for International and Regulatory Affairs, effective January 16, 2012. He was previously Administrator for Policy and External Affairs at the U.S. Patent and Trademark Office (USPTO). Before that he worked at the AIPLA in the position to which he now returns.

In This Issue
This issue contains the following items:
 • Genachowski Addresses Incentive Auctions and Unlicensed Spectrum
 • Four Senators Advocate Use of Incentive Auction Process for Allocating Spectrum for Unlicensed Use
 • Commentary on FCC Spectrum Discretion
 • Harper Collins Sues Open Media Over E-Book Distribution
 • People and Appointments
Washington Tech Calendar
New items are highlighted in red.
Calendar Notice
The House Judiciary Committee (HJC) has not yet announced a date for continuation of the mark up of HR 3261 [LOC | WW], the "Stop Online Piracy Act" or "SOPA".
Friday, January 13

The House will meet at 11:00 AM in pro forma session.

The Senate will meet at 12:00 NOON in pro forma session only .

Supreme Court conference day. See, calendar. Closed.

10:00 AM. The U.S. Court of Appeals (FedCir) will hear oral argument in Intermec Technologies v. Palm, App. Ct. No. 2011-1296, an appeal from the U.S. District Court (DDel) in a patent infringement case. This is the third case on the calendar. Location: Courtroom 201, 717 Madison Place, NW.

Monday, January 16

Martin Luther King's Birthday. This is a federal holiday. See, OPM list of 2012 federal holidays.

Tuesday, January 17

The House will meet at 2:00 PM in pro forma session. See, Rep. Cantor's calendar.

8:00 - 10:00 AM. Broadband Census News LLC will host a panel discussion titled "The Wired Home and Wireless Policy". The speakers will be Rick Kaplan (Chief of the FCC's Wireless Telecommunications Bureau), Fred Campbell (head of the Wireless Communications Association International), Walter McCormick (head of the US Telecom), Grant Seiffert (head of the Telecommunications Industry Association), and Drew Clark. Breakfast will be served. This event is open to the public. The price to attend is $47.12. See, notice and registration page. This event is also sponsored by Comcast, Google, ICF Intl., Intel, NCTA TIA, and US Telecom. Location: Clyde's of Gallery Place, 707 7th St., NW.

9:00 AM - 4:30 PM. Day one of the Net Caucus's annual State of the Net Conference. See, conference web site and schedule. Location: Hyatt Regency, Capitol Hill, 400 New Jersey Ave., NW.

9:00 AM - 5:45 PM. Day one of a three day event hosted by the International Intellectual Property Institute (IIPI) and U.S. Patent and Trademark Office (USPTO) titled "Seminar on Specialized Intellectual Property Rights Courts". The speakers will include David Kappos (head of the USPTO), Shinjiro Ono (former Deputy Commissioner of the Japan Patent Office), and Jorge Amigo (former Director of the Mexican Institute of Industrial Property). The deadline to register is January 13. Free. See, notice. Location: USPTO, 600 Dulany St., Alexandria, VA.

12:00 NOON - 2:00 PM. American Bar Association's (ABA) Section of International Law will host an on site and teleconferenced panel discussion titled "Trade Remedies Approaches of the US and EU Toward China: Similarities and Differences". The speakers will be Joseph Dorn (King & Spaulding), Gary Horlick (Gary Horlick), Edwin Vermulst (VVGB Advocaten), Matthew Yeo (Steptoe & Johnson), and Kristin Mowry (Mowry & Grimson). The price ranges from $15 to $20. Lunch will be provided for on site attendees. See, notice. Location: Sidley Austin, 1501 K St., NW.

12:15 - 1:30 PM. The Federal Communications Bar Association's (FCBA) Young Lawyers Committee will host a brown bag lunch titled "Industry Roundtable -- The Roles and Responsibilities of the Young Lawyer". For more information, contact Mark Brennan at Mark dot Brennan at hoganlovells dot com or Brendan Carr at BCarr at wileyrein dot com. Location: Wilmer Hale, Multi-Purpose Room on the ground level, 1875 Pennsylvania Ave., NW.

Wednesday, January 18

The House will meet at 10:00 AM for morning hour, and at 12:00 NOON for legislative business. It will consider a resolution of disapproval of the President's exercise of authority to increase the debt limit. See, Rep. Cantor's calendar.

9:00 - 11:00 AM. The Information Technology and Innovation Foundation (ITIF) will host an panel discussion titled "Bits and Bricks: Transforming the Construction Industry Through Innovation". The speakers will be Robert Atkinson (ITIF), Phillip Bernstein (Autodesk), Dorothy Robyn (Department of Defense), Robert Peck (GSA) and Shyam Sunder (NIST). See, notice. Location: National Press Club, Holeman Lounge, 529 14th St., NW.

9:00 - 11:30 AM. Day two of the Net Caucus's annual State of the Net Conference. See, conference web site and schedule. Location: Hyatt Regency, Capitol Hill, 400 New Jersey Ave., NW.

9:00 AM - 5:30 PM. Day one of a three day event hosted by the International Intellectual Property Institute (IIPI) and U.S. Patent and Trademark Office (USPTO) titled "Seminar on Specialized Intellectual Property Rights Courts". The speakers will include David Kappos (head of the USPTO), Shinjiro Ono (former Deputy Commissioner of the Japan Patent Office), and Jorge Amigo (former Director of the Mexican Institute of Industrial Property). The deadline to register is January 13. Free. See, notice. Location: USPTO, 600 Dulany St., Alexandria, VA.

10:00 AM - 12:00 NOON. The House Oversight and Government Reform Committee (HOGRC) will hold a titled "Government Mandated DNS Blocking and Search Takedowns -- Will It End the Internet as We Know It?" See, notice. The HOGRC does not have jurisdiction over HR 3261 [LOC | WW], the "Stop Online Piracy Act" or "SOPA". The House Judiciary Committee (HJC) does. However, this hearing is directed at provisions in the SOPA. The HOGRC will webcast this hearing. Location: Room 2154, Rayburn Building, with overflow seating in Room 2203.

12:00 NOON - 1:30 PM. American Bar Association's (ABA) Section of Antitrust Law will host a teleconferenced panel discussion titled "Monopolization Updates from China and Canada". The speakers will be Neil Campbell (McMillan) and Kate Wallace (Jones Day). Free. See, notice.

Thursday, January 19

The House will not meet. Day one of a three day event titled "House Republican Issues Conference". See, Rep. Cantor's calendar.

The Senate will not meet.

9:00 AM - 3:30 PM. Day one of a three day event hosted by the International Intellectual Property Institute (IIPI) and U.S. Patent and Trademark Office (USPTO) titled "Seminar on Specialized Intellectual Property Rights Courts". The speakers will include David Kappos (head of the USPTO), Shinjiro Ono (former Deputy Commissioner of the Japan Patent Office), and Jorge Amigo (former Director of the Mexican Institute of Industrial Property). The deadline to register is January 13. Free. See, notice. Location: USPTO, 600 Dulany St., Alexandria, VA.

11:45 AM - 1:45 PM. The Tech Freedom (TF), Competitive Enterprise Institute (CEI) and Cato Institute will host a panel discussion titled "Unintended Consequences of Rogue Website Crackdown". The program will address three bills under consideration by the House and Senate: (1) HR 3261 [LOC | WW], the "Stop Online Piracy Act" or "SOPA", (2) draft [18 pages in PDF] of the "Online Protection & Enforcement of Digital Trade Act", or "OPEN Act", and S 968 [LOC | WW], the "Preventing Real Online Threats to Economic Creativity and Theft of Intellectual Property Act of 2011" or "PROTECT IP Act". The speakers will be Berin Szoka (TF), Larry Downes (TF), Allan Friedman (Brookings Institution), James Gattuso (Heritage Foundation), Dan Kaminsky, Julian Sanchez (Cato Institute). Lunch will be served. Free and open to the public. The deadline to register is 12:00 NOON on January 18. See, notice and registration page. Location: Reserve Officers Association of the US, One Constitution Ave., NE.

12:30 - 1:45 PM. The Federal Communications Commission's (FCC) Wireless Telecommunications Bureau's (WB) Division Chiefs will hold a meeting. The speakers will include Mary Bucher (Technologies, Systems and Innovation Division), Nese Guendelsberger ( Spectrum and Competition Policy Division), Roger Noel (Mobility Division), Blaise Scinto (Broadband Division), and Margaret Weiner (Auctions and Spectrum Access Division). The price to attend is $17. Registrations and cancellations are due by 12:00 NOON on January 16. See, notice. The Federal Communications Bar Association (FCBA) states that this is an FCBA event. Location: Wiley Rein, 1776 K St., NW.

6:00 - 8:15 PM. The Federal Communications Bar Association's (FCBA) Wireline Committee will host an event titled "Understanding the Connect America Fund Order". CLE credits. Prices vary. See, notice. Location: Dow Lohnes, 1200 New Hampshire Ave., NW.

Friday, January 20

The House will not meet. Day two of a three day event titled "House Republican Issues Conference". See, Rep. Cantor's calendar.

The Senate will meet at 2:00 PM in pro forma session only.

Supreme Court conference day. See, calendar. Closed.

1:00 - 2:30 PM. American Bar Association's (ABA) Section on Intellectual Property Law will host a webcast panel discussion titled "Prosecution Strategies: Tackling USPTO Obviousness Rejections". The speakers will be Janet Hendrickson (Senniger Powers), Gregory Hillyer (Feldman Gale), Michelle O'Brien (O'Brien Jones), and Zachary Stern (Oblon, Spivak). The price ranges from $70 to $150. CLE credits. See, notice.

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