8/2. The Senate rejected a motion to invoke cloture on S 3414 [LOC | WW | PDF], the "Cybersecurity Act of 2012", by a vote of 52-46. A super majority of 60 is required to pass a cloture motion. Later in the day the Senate recessed until September.

The two main causes of opposition were the inclusion of Title I of the bill, which imposes a regulatory regime on private sector entities, and the ruthlessly fast and closed process by which Sen. Harry Reid (D-NV), the Senate Majority Leader, attempted to force this bill upon the Senate.

Voting correlated with party affiliation. Most Democrats voted yes. Most Republicans voted no.

New England Republicans Sen. Scott Brown (R-MA), Sen. Susan Collins (R-ME), and Sen. Olympia Snowe (R-ME) voted yes, as did Indiana Republicans Sen. Dan Coats (R-IN) and Sen. Richard Lugar (R-IN).

Sen. Jon Tester (D-MT), Sen. Max Baucus (D-MT), Sen. Mark Pryor (D-AR), Sen. Jeff Merkley (D-OR), and Sen. Ron Wyden (D-OR) voted no. Sen. Frank Lautenberg (D-NJ) initially voted no. Sen. Reid kept the vote open long after the expiration of the voting period while he and Sen. Joe Lieberman (D-CT), sponsor of the bill, conferred on the floor with Sen. Lautenberg. Sen. Lautenberg switched his vote to yes. Then Sen. Reid voted no, to preserve his right to bring a motion to reconsider, and the vote was closed.

Privacy. The bill also would create end runs around the 4th Amendment, 5th Amendment due process, the Wiretap Act, Stored Communications Act, state wiretap laws, and generally, individuals' and business's legitimate expectations of privacy in electronic communications and stored data.

Sen. Wyden (at right) who joined with Republicans in voting no, explained that privacy was a reason for his opposition.

Sen. Wyden (at right) stated in a release that "Senators were asked to sacrifice Internet users’ privacy and civil liberties for weak proposals to improve cyber security; I voted no. In its current form, the Cybersecurity Act does not sufficiently safeguard Internet users’ privacy and civil liberties, nor would it create the correct incentives to adequately protect the nation’s critical infrastructure from cyber threats."

He noted that Sen. Al Franken (D-MN) had amendments that would have addressed privacy concerns, but that they could not have been offered. He concluded that "I hope that the Senate will return to this issue soon after addressing both the privacy and security short-comings of the current legislation."

The other Senator from Oregon, Sen. Merkley, also voted no. He stated in a release that the bill "provides companies with broad authority to collect and monitor Americans' internet communications. This bill needs more debate, and there are many amendments Senators have proposed that deserve consideration, and that's why I voted against ending debate on the bill."

Standards. The House passed a bill in April that would not impose government mandates or standards on the private sector. See, HR 3523 [LOC | WW], the "Cyber Intelligence Sharing and Protection Act" or "CISPA".

Sen. John McCain (R-AZ), a leader of the opposition to S 3414, is the sponsor of a cyber security bill without government compulsion, S 2151 [LOC | WW], the "Secure IT Act".

S 3414 lost much support in the Senate because of its compulsory standards approach.

Fast and Closed Process. The fast and closed process also generated opposition. Although, Sen. Reid was likely pursuing the very rational legislative strategy of moving a bill from introduction to passage so quickly that many affected people and businesses would not have time to study the bill, organize, develop legislative strategies, and work with Senators.

The bill was introduced just 14 days before the failed cloture vote. Moreover, it is over two hundred pages of technical and complex provisions. There were no committee hearings. There were no committee markups. Sponsors' and proponents' summaries and statements were usually cursory, and sometimes inconsistent with the content of the bill. Sen. Reid sought approval of the bill without significant floor debate, or opportunity to offer amendments.

Sen. Charles Grassley (R-IA) stated on August 1 that "The bill before us was introduced 13 days ago" and "before a real debate began the Majority Leader cut it off". He said that there is a "lack of a real process in the Senate". He added that "this is eerily reminiscent of the debate surrounding Obamacare. During that time, then-Speaker of the House Pelosi declared, ``We have to pass the bill so that you can find out what is in it.´´" See, statement.

Post Vote Comments. Sen. Reid (at right) stated in a release after the vote on August 2 that "Despite a unanimous chorus of national security leaders demanding urgent action, Republicans recklessly obstructed cyber security legislation today, filibustering it with irrelevant, political amendments that serve no purpose other than catering to the Tea Party."

Sen. John Rockefeller (D-WV), a cosponsor of the bill, issued a release promptly after the vote. He stated that "Today's political maneuvering by Republican leadership is more than disappointing. It’s reckless. We worked hard for more than three years and now because a handful of Republican Senators are afraid of crossing the Chamber of Commerce's beltway lobbyists, we may end up with nothing on this urgent issue."

Similarly, the White House news office issued a release that states that "the politics of obstructionism, driven by special interest groups seeking to avoid accountability, prevented Congress from passing legislation".

NDAA. Finally, it might be noted that not only did the Senate not approve a cyber security bill this week, but it consumed much time and energy that might have been devoted to passage of S 3254 [LOC | WW], the "National Defense Authorization Act for Fiscal Year 2013" or "NDAA", a bill with cyber warfare provisions.

The main purpose of S 3414 is to increase the capacity of critical infrastructure in the US to withstand cyber attacks.

S 3254 deals with, among other topics, US offensive cyber warfare, and supply chain threats to US cyber security. See, story titled "SASC Approves Defense Authorization Bill with Cyber Warfare and ICT Provisions" in TLJ Daily E-Mail Alert No. 2,397, June 15, 2012.

8/2. AT&T announced in a release that "it has agreed to acquire NextWave Wireless, Inc."

NextWave is a company that holds, but does not use, spectrum licenses in the Wireless Communication Services (WCS) and Advanced Wireless Service (AWS) bands. NextWave wrote in its Form 10-Q, filed with the Securities and Exchange Commission (SEC) on May 9, 2012, that it is trying to sell its spectrum licenses.

This transaction, and transfer of licenses, requires regulatory review by the Federal Communications Commission (FCC). The parties will also likely make a Hart Scott Rodino filing.

The FCC adopted and released a Report and Order and Second Report and Order [154 pages in PDF] on May 20, 2010 that amended the FCC's WCS technical rules. It is FCC 10-82 in WT Docket No. 07-293, IB Docket No. 95-91 and GEN Docket No. 90-537.

AT&T and Sirius XM Radio filed a joint proposal [19 pages in PDF] with the FCC on June 15, 2012 that proposes further changes to the FCC's WCS technical rules. See also, June 19 piece by AT&T's Joan Marsh titled "Breaking Down Barriers in the WCS Band".

AT&T stated in its August 2 release that "the proposed WCS rule changes and NextWave acquisition represent an alternative approach to creating additional wireless network capacity to help support skyrocketing wireless data usage on smartphones and tablets. If approved, the proposal will enable AT&T to begin initial deployment of WCS spectrum for added 4G LTE capacity, in approximately three years."

AT&T also explained the financial aspects of the proposed transaction thus: "AT&T will acquire all the equity of NextWave for approximately $25 million plus a contingent payment of up to approximately $25 million and, through a separate agreement with NextWave’s debtholders, all of the company’s outstanding debt will be acquired by AT&T or retired by NextWave, for a total of $600 million in cash. The outstanding debt held by NextWave’s bondholders will be satisfied through cash and a transfer of selected NextWave assets. NextWave’s debtholders have agreed to the terms, and a majority of its shareholders have agreed to support the transaction."

NextWave wrote in its May Form 10-Q that "As of March 31, 2012, the aggregate principal amount of our secured indebtedness was $1,061.8 million."

The Public Knowledge's (PK) John Bergmayer stated in a release that "The 'spectrum gap' between AT&T and Verizon and the rest of the industry is already unacceptably large. These proposed transactions would worsen it. They are a symptom of our broken spectrum policy, which rewards concentration rather than competition."

He added that "An important question to ask is why this valuable spectrum was allowed to go unused for so long. To prevent this waste, the FCC needs to adopt build-out policies that discourage speculation, and 'use it or share it' policies that allow for unlicensed use of fallow spectrum. Finally, the FCC needs to update its spectrum screen to discourage the same few companies from acquiring more and more of this vital resource."

8/1. The Superior Court of the State of California, Santa Clara County issued a Proposed Statement of Decision Hewlett-Packard v. Oracle. HP described this as a "tremendous win for HP". Oracle announced that it would appeal.

Oracle announced in release on March 22, 2011 that "it has decided to discontinue all software development on the Intel Itanium microprocessor". HP makes Itanium based servers. HP filed a complaint [heavily redacted] against Oracle on June 15, 2011.

HP asserts that there was a contract between HP and Oracle that obligated Oracle to offer future versions of Oracle's software on Itanium. HP's claims include breach of contract, breach of implied contract, and promissory estoppel.

HP issued a release on August 1, 2012 that describes some aspects of the ruling. It wrote that "Today's proposed ruling is a tremendous win for HP and its customers." The trial court "has confirmed the existence of a contract between HP and Oracle that requires Oracle to port its software products to HP's Itanium-based servers. We expect Oracle to comply with its contractual obligation as ordered by the Court."

HP's release quotes from the court decision. "In this action for declaratory relief, the Court finds in favor of HP and against Oracle on both the breach of contract and promissory estoppel causes of action brought by HP."

Also, "The Settlement and Release Agreement entered into by HP, Oracle and Hurd on September 20, 2010, requires Oracle to continue to offer its product suite on HP’s Itanium-based server platforms and does not confer on Oracle the discretion to decide whether to do so or not."

Oracle's Deborah Hellinger stated in a release that "Last March, Oracle made an engineering decision to stop future software development on the Itanium chip. We made the decision as we became convinced that Itanium was approaching its end of life".

Hellinger continued that "Nothing in the Court's preliminary opinion changes that fact. We know that Oracle did not give up its fundamental right to make platform engineering decisions in the 27 words HP cites from the settlement of an unrelated employment agreement. HP's argument turns the concept of Silicon Valley 'partnerships' upside down."

"We plan to appeal the Court's ruling while fully litigating our cross claims that HP misled both its partners and customers", said Hellinger.

This case is HP v. Oracle, Superior Court of the State of California for the County of Santa Clara, No. 1-11-CV-203163, Judge James Kleinberg presiding.

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The House will meet at 10:00 AM in pro forma session. The House will not meet, except for pro forma sessions, until September 10.

The Senate will meet at 10:15 AM in pro forma session. The Senate will not meet, except for pro forma sessions, until September 10.

8:30 AM. The Department of Labor's (DOL) Bureau of Labor Statistics (BLS) is scheduled to release its July 2012 unemployment data.

The House will not meet on the weeks of Monday, August 6, through Friday, August 10, Monday, August 13, through Friday, August 17, Monday, August 20, through Friday, August 24, Monday, August 27, through Friday, August 31, or Monday, September 3, through Friday, August 7.

The Senate will not meet on the weeks of Monday, August 6, through Friday, August 10, Monday, August 13, through Friday, August 17, Monday, August 20, through Friday, August 24, Monday, August 27, through Friday, August 31, or Monday, September 3, through Friday, August 7.

10:00 AM. The U.S. Court of Appeals (FedCir) will hear oral argument in Accenture Global Services v. Guidewire Software, App. Ct. No. 2011-1486, an appeal from the U.S. District Court (NDCal) in a patent infringement case. Location: Courtroom 201.

Deadline to submit reply comments to the Federal Communications Commission (FCC) in response to its Further Notice of Proposed Rulemaking (NPRM) [182 pages in PDF] regarding its collection of universal service taxes. The FCC adopted this item on April 27, 2012, and released the text on April 30. It is FCC 12-46 in WC Docket Nos. 06-122 and GN Docket No. 09-51. See, notice in the Federal Register, Vol. 77, No. 110, Thursday, June 7, 2012, at Pages 33896-33944.

Deadline to submit reply comments to the Federal Communications Commission (FCC) in response to its Notice of Proposed Rulemaking (NPRM) [22 pages in PDF] regarding creating a Do-Not-Call registry for public safety answering points (PSAPs). The FCC adopted this item on May 21, 2012, and released the text on May 22. It is FCC 12-56 in CG Docket No. 12-129. See, notice in the Federal Register, Vol. 77, No. 120, Thursday, June 21, 2012, Pages 37362-37367.

10:00 AM. The U.S. Court of Appeals (FedCir) will hear oral argument in Trans Video Electronics v. Sony Electronics, App. Ct. No.2012-1110, an appeal from the U.S. District Court (NDCal) in a patent infringement case involving video distribution technology, D.C. No. 09-civ-3304. Location: Courtroom 201.

6:00 - 8:15 PM. The DC Bar Association will host a presentation titled "Ethics of E-Mail and Social Media". The speaker will be Thomas Spahn (McGuire Woods). The price to attend ranges from $89 to $129. Reporters are barred from attending most DC Bar events. CLE credits. See, notice. For more information, call 202-626-3488. Location: DC Bar Conference Center, 1101 K St., NW.

No events listed.

10:00 AM. The U.S. Court of Appeals (FedCir) will hear oral argument in Northrup Grumman Computing Systems v. US, App. Ct. Nos. 2011-5124 and 2012-5044, appeals from the U.S. Court of Federal Claims. Location: Courtroom 402.

5:00 PM. Deadline to register to present comments at the President's National Security Telecommunications Advisory Committee (NSTAC) August 16 meeting. The agenda includes discussions of (1) the Nationwide Public Safety Broadband Network (NPSBN), (2) the DHS's National Cybersecurity and Communications Integration Center (NCCIC), and (3) the proposal to develop a separate out of band data network supporting communications among carriers, ISPs, vendors, and additional critical infrastructure owners and operators during a severe cyber incident that renders the internet unusable. See, notice in the Federal Register, Vol. 77, No. 146, Monday, July 30, 2012, at Pages 44641-44642.

Deadline to submit written comments to the President's National Security Telecommunications Advisory Committee (NSTAC) in advance of its August 16 meeting. The agenda includes discussions of (1) the Nationwide Public Safety Broadband Network (NPSBN), (2) the DHS's National Cybersecurity and Communications Integration Center (NCCIC), and (3) the proposal to develop a separate out of band data network supporting communications among carriers, ISPs, vendors, and additional critical infrastructure owners and operators during a severe cyber incident that renders the internet unusable. See, notice in the Federal Register, Vol. 77, No. 146, Monday, July 30, 2012, at Pages 44641-44642.

7/31. Ted Cruz won the Texas Republican Senate primary election with 57% of the vote. He defeated Lieutenant Governor David Dewhurst.

Dewhurst had the support of Gov. Rick Perry, and had much more campaign funding. Now, given Texas's Republican leaning, and Cruz's effectiveness as a campaigner, he will likely be elected in November to the Senate seat being vacated by retiring Sen. Kay Hutchison (R-TX).

News publications directed a mass audiences have focused on Cruz's status as a tea party candidate. In contrast, this article focuses on Cruz's background and expertise in several technology related areas of law.

For example, he successfully argued a patent case before the Supreme Court that is of importance to tech companies. And, as head of the Federal Trade Commission's (FTC) Office of Policy Planning (OPP) early in the Bush administration he advocated the removal of regulatory barriers to e-commerce.

Patent Litigation. Recently, he briefed, argued and won a patent case before the Supreme Court. He is a partner in the Houston and Washington DC offices of the law firm of Morgan Lewis.

He represented SEB in Global Tech Appliances  v. SEB., a case regarding inducement of patent infringement under 35 U.S.C. § 271(b), which provides that "Whoever actively induces infringement of a patent shall be liable as an infringer." See, SEB's brief.

The Supreme Court issued its 8-1 opinion [23 pages in PDF] on May 31, 2011. The Supreme Court wrote, "we now hold that induced infringement under § 271(b) requires knowledge that the induced acts constitute patent infringement."

Major tech companies, including Google, eBay, Facebook, Intel, Dell, Cisco, Comcast, and Microsoft joined in one of several tech sector amicus curiae briefs in support of Global Tech. While these companies own patents, their concern was that they are sometimes alleged to induce infringement by others, for example, by distributing a product with a multitude of noninfringing uses that, when combined with another product, allegedly infringes a patent on the larger combination apparatus or system.

Cruz does not, however, focus on patent law. Rather, he handles Supreme Court and other appellate litigation generally. See also, his Morgan Lewis biography web page.

Removing Regulatory Barriers to E-Commerce. From June 2001 to early 2003, Cruz was the Director of the FTC's Office of Policy Planning (OPP). This was during Timothy Muris' term as FTC Chairman. One of Cruz's main activities there was studying and advocating the reduction of unnecessary regulatory barriers to electronic commerce.

He chaired the FTC's Internet Task Force. He also helped organize a workshop at the FTC on October 8 through 10, 2002, titled "Possible Anticompetitive Efforts to Restrict Competition on the Internet". See, workshop web site, with links to testimony of participants.

He also testified for the FTC on September 26, 2002, at the House Commerce Committee's (HCC) Subcommittee on Commerce, Trade and Consumer Protection's hearing titled "State Impediments to E-Commerce: Consumer Protection or Veiled Protectionism?" See, his prepared testimony.

He also engaged in advocacy, on behalf of the FTC, to limit regulatory barriers to e-commerce.

For example, he co-signed the FTC's March 27, 2002 comment to the state of Connecticut criticizing state bans on sales of contact lens by out of state vendors as unnecessary to protect health, and an impediment to e-commerce.

He also co-signed the FTC's August 29, 2002 amicus curiae brief [PDF] filed with the U.S. District Court (WDOkla) in a case filed by an internet based casket retailer against the state of Oklahoma challenging the constitutionality of Oklahoma's Funeral Services Licensing Act.

See also, stories titled "Muris Appoints More Top Staff at FTC" in TLJ Daily E-Mail Alert No. 212, June 12, 2001, and "E-Commerce Proponent to Become Solicitor General of Texas" in TLJ Daily E-Mail Alert No. 582, January 14, 2003.

Solicitor General of Texas. Cruz left the FTC in 2003 to become Solicitor General (SG) of the state of Texas. He served in that position until 2008.

He was the Texas SG when the Department of Justice's (DOJ) Antitrust Division, Texas, and several other states filed a complaint against Oracle alleging that its proposed acquisition of PeopleSoft would lessen competition substantially in interstate trade and commerce in violation of Section 7 of the Clayton Act, which is codified at 15 U.S.C. § 18. The plaintiffs sought an injunction of the proposed acquisition. See, story titled "Antitrust Division Sues Oracle to Enjoin Its Proposed Acquisition of PeopleSoft" in TLJ Daily E-Mail Alert No. 846, March 1, 2004.

In short, that action crashed and burned in the U.S. District Court (NDCal), the plaintiffs dropped the case, and Oracle completed its acquisition of PeopleSoft.  See, story titled "DOJ Loses Oracle Case" in TLJ Daily E-Mail Alert No. 974, September 10, 2004, and "DOJ Will Not Appeal Oracle Antitrust Case" in TLJ Daily E-Mail Alert No. 989, October 4, 2004.

That complaint lists five attorneys for Texas, including Greg Abbot, the Attorney General, who was Cruz's boss. However, Cruz's name does not appear on the complaint. But, as Solicitor General, Cruz was the top appellate lawyer for the state. The antitrust action was in a trial court.

More About Cruz. Before joining the FTC, he was briefly Associate Deputy Attorney General at the DOJ. Before that, he was DOJ coordinator for the Bush transition team. Before that he worked for the Bush Cheney 2000 campaign, with responsibility for legal policy. He also worked on briefs for the U.S. Supreme Court and Florida Supreme Court on behalf of George Bush during the Florida election contest.

He has a BA cum laude from Princeton, and a JD magna cum laude from Harvard law school. He was a law clerk to Judge Mike Luttig of the U.S. Court of Appeals (4thCir), who is now General Counsel of Boeing. Cruz was then a law clerk to Chief Justice of the United States William Rehnquist.

And, to bolster his tea party credentials, he served food from Chick-fil-A at a recent victory dinner.

8/2. The Senate confirmed four of the five nominees for the Privacy and Civil Liberties Oversight Board (PCLOB): James Dempsey, Elisebeth Cook, Rachel Brand, and Patricia Wald. The Senate has not yet confirmed David Medine. See, story titled "Senate Judiciary Committee Holds Hearing on PCLOB Nominees" in TLJ Daily E-Mail Alert No. 2,375, April 19, 2012.

8/2. The Senate confirmed Meredith Broadbent to be a member of the U.S. International Trade Commission (USITC) for a term expiring June 16, 2017.

8/2. The Senate confirmed Patricia Falcone to be an Associate Director of the Executive Office of the President's (EOP) Office of Science and Technology Policy (OSTP).

8/2. The Senate confirmed Mark Mazur to be an Assistant Secretary of the Treasury.

8/2. The Senate confirmed Matthew Rutherford to be an Assistant Secretary of the Treasury.

8/2. The Senate confirmed Gershwin Drain to be a Judge of the U.S. District Court (EDMich), by a vote of 55-41. See, Roll Call No. 189. It was a nearly straight party line vote. The Senate then recessed until September. Sen. Patrick Leahy (D-VT) released a statement in which he urged the Senate to confirm more pending judicial nominees when it returns from its recess. However, the Senate is not likely to confirm more Court of Appeals nominees, such as Richard Taranto for the Federal Circuit. See, story titled "Confirmations and Presidential Elections" in TLJ Daily E-Mail Alert No. 2,417, August 1, 2012.

8/2. The Senate Judiciary Committee (SJC) held an executive business meeting at which approved the nominations of Jon Tigar (USDC/NDCal), William Orrick (USDC/NDCal), and Thomas Durkin (USDC/NDIll).

8/1. President Obama announced his intent to nominate Christopher Meade to be General Counsel of the Department of the Treasury. See, White House news office release.