8/16. The Department of Justice's (DOJ) Antitrust Division and state of New York filed a complaint [19 pages in PDF] in the U.S. District Court (DC) against Verizon, Verizon Wireless, Comcast, Time Warner Cable, Cox Communications, and Bright House Networks that alleges violation of Section 1 of the Sherman Act in connection with a series of agreements between Verizon and cable companies.

Under these agreements, Verizon Wireless agreed to acquire unused Advanced Wireless Services (AWS) spectrum licenses from several cable companies, and Verizon and Verizon Wireless and cable companies agreed to market each other's services. Also, subsequently Verizon Wireless conditionally agreed to sell 700 MHz A and B block licenses to T-Mobile USA.

Nominally, the complaint seeks court injunction of the agreements. However, the parties simultaneously announced that they have settled this action. Verizon Wireless will acquire the AWS spectrum. The cross marketing agreements are allowed, but must be amended, and be of limited duration -- four years. See, Stipulation and Order and proposed Final Judgment.

The proposed settlement must be approved by the District Court.

The DOJ stated in a release that "the proposed settlement protects competition and consumers by removing provisions that would lessen the companies' incentives to compete aggressively in the areas where Verizon’s FiOS services offer a critical competitive alternative to the cable companies’ video and broadband products. The proposed settlement also limits the duration of the companies’ collaboration to December 2016 in important respects, ensuring that they retain incentives to compete against one another.

The complaint states that in December 2011 Verizon Wireless, which is a joint venture of Verizon Communications and Vodafone, and the cable defendants "entered into a series of commercial agreements ... that allow them to sell bundled offerings that include Verizon Wireless services and a Cable Defendant's residential wireline voice, video, and broadband services, including ``quad-plays.´´ In addition, the Commercial Agreements allow the Defendants to develop integrated wireline and wireless telecommunications technologies through a research and development joint venture."

David Cohen, EVP of Comcast, stated in a release that "We appreciate the timely completion of the antitrust review by the government of the proposed sale of spectrum and associated commercial agreements between Verizon Wireless, Comcast, and the other cable companies. And, we are pleased that the consent decree that we have negotiated with the Department of Justice preserves the most important goals of the agreements, including Comcast's ability to market Verizon Wireless services throughout our footprint in order to offer our customers a wireless option, Verizon Wireless' ability to market our products in virtually all of our footprint, our ability to opt into an MVNO relationship with Verizon Wireless, and the essential structure of the innovation R&D technology joint venture. We are also pleased that the FCC is circulating an order proposing approval of the spectrum sale and we are hopeful that a final order will be issued shortly."

Berin Szoka of the Tech Freedom stated in a release that "This deal is great news for consumers".

Gigi Sohn, head of the Public Knowledge (PK), stated in a release that "By allowing Verizon and the cable companies to sell each other's services, the DoJ and the FCC are acknowledging what has been clear for some time -- that broadband competition policy in the United States has failed. For years, policymakers have hoped that "facilities-based" competition between wired broadband providers would protect consumers, drive down prices, and encourage new deployment. It is clear that this promise has not been fulfilled."

"Instead", said Sohn, "Verizon has stopped deploying fiber, and will be marketing cable broadband instead of its own services in non-fiber markets. Nationwide, cable has opened up an unsurpassable lead over DSL. Meanwhile, the wireless broadband market has become a near-duopoly, as AT&T and Verizon acquire more and more spectrum, leaving all other competitors behind."

Joel Kelsey of the Free Press stated in a release that "Limiting the joint-marketing agreements between Verizon and the cable companies to four years is a start. But this concession doesn't deal with the deep structural problems in the market for at-home broadband service. There is still no meaningful competition".

This case is USA and State of New York v. Verizon Communications, Inc., et al., U.S. District Court for the District of Columbia, D.C. No. Case 1:12-cv-01354.

8/16. Federal Communications Commission (FCC) Chairman Julius Genachowski stated in a release that "I will be circulating a draft order to my colleagues" that will provide for FCC approval of the agreements between several cable companies and Verizon and Verizon Wireless, subject to concessions.

He stated that the concessions include build out and roaming obligations for Verizon Wireless. However, the FCC has publicly released nothing but a short publicity statement by Genachowski.

In it he states that "Verizon Wireless has undertaken an unprecedented divestiture of spectrum to one of its competitors, T-Mobile, and has committed to accelerate the build-out of its new spectrum and enhance its roaming obligations. In addition, the companies' commercial agreements will be modified to, among other things, preserve Verizon's incentives to build out FiOS, increase wireless competition, and ensure that the proposed IP venture is pro-consumer and that its products cannot be used in anti-competitive ways."

The FCC has statutory authority to conduct license transfer reviews. It also often leverages this authority to conduct de facto antitrust reviews, in large part redundant of those conducted by the Department of Justice (DOJ), albeit without statutory authority under the antitrust laws. However, the FCC does not sue to block license transfers, and its does not issue final orders with a finding of violation of antitrust law. Rather, it delays and investigates, mainly for the purpose of extracting concessions.

Geoffrey Manne of the Tech Freedom stated in a release that "the DOJ and FCC have appropriately divided their review of the deal, with the DOJ considering the competitive effects of the commercial agreements and the FCC assessing whether the spectrum license transfers are in the public interest. Congressional leaders and many self-appointed consumer advocates had demanded that the FCC evaluate the commercial agreements. But doing so would violate Section 310(d), which authorizes the agency to evaluate only license transfers".

8/15. The Department of Justice's (DOJ) Antitrust Division and the Federal Trade Commission (FTC) announced that they will host a series of panel discussion on September 10 titled "Most Favored Nation Clauses and Antitrust Enforcement and Policy".

The DOJ has found MFN clauses to be anticompetitive in tech related agreements, including the original proposed class action settlement of two Google Books cases brought by publishers and authors, and in the Apple e-books case filed in April.

The DOJ stated in a release that "The most commonly used MFN provisions guarantee a customer that it will receive prices that are at least as favorable as those provided to other buyers of the same seller, for the same products or services. Although at times employed for benign purposes, MFNs can under certain circumstances present competitive concerns. This is because they may, especially when used by a dominant buyer of intermediate goods, raise other buyers' costs or foreclose would-be competitors from accessing the market. Additionally, MFNs can facilitate collusion and stabilize coordinated pricing among sellers."

MFN clauses are at issue in the DOJ's e-book antitrust action against book publishers and Apple. See, story titled "DOJ Sues Apple and Book Publishers Alleging E-Book Price Collusion" in TLJ Daily E-Mail Alert No. 2,368, April 11, 2012.

MFN clauses were also an issue in the DOJ's objections to the original proposed class action settlement of some of the Google Books copyright infringement cases. The District Court rejected the proposed settlement.

On September 18, 2009, the Department of Justice's (DOJ) Antitrust Division filed a pleading [32 pages in PDF] titled "Statement of Interest of the United States of America Regarding Proposed Class Settlement" in which it urged the Court to "reject the Proposed Settlement in its current form". See also, story titled "DOJ Files Pleading in Google Books Case" in TLJ Daily E-Mail Alert No. 1,985, September 21, 2009.

The proposed settlement agreement provided for a Books Rights Registry to be created. The original agreement also provided that the Registry would give Google MFN treatment.

This clause provided that "The Registry (and any substantially similar entity organized by Rightsholders that is using any data or resources that Google provides, or that is of the type that Google provides, to the Registry relating to this Settlement) will extend economic and other terms to Google that, when taken as a whole, do not disfavor or disadvantage Google as compared to any other substantially similar authorizations granted to third parties by the Registry (or any substantially similar entity organized by Rightsholders that is using any data or resources that Google provides, or that is of the type that Google provides, to the Registry relating to this Settlement) ..." (Parentheses in original.)

The DOJ wrote that this MFN clause in the original proposed settlement agreement "discourages potential competitors (including those sponsored by rightsholders) from attempting to follow Google into digital-book distribution because it could not obtain better terms than Google." (At page 24. Parentheses in original.)

The parties to that settlement dropped the above quoted MFN language in the amended proposed settlement agreement. The District Court later rejected that agreement for reasons other than MFN. See, mark up copy of settlement agreement.

The upcoming event is open to the public. The DOJ and FTC request written comments. The deadline to submit comments is October 10, 2012. However, they have already selected speakers. The event will be held from 9:00 AM to 5:30 PM. it will be held in the FTC's Satellite Building and Conference Center at 601 New Jersey Ave., NW. See, event web site.

8/15. President Obama sent notices to the Speaker of the House of Representatives and the President of the Senate titled "Continuation of the National Emergency with Respect to Export Control Regulations".

The President stated that "Section 202(d) of the National Emergencies Act (50 U.S.C. 1622(d)) provides for the automatic termination of a national emergency unless, within the 90-day period prior to the anniversary date of its declaration, the President publishes in the Federal Register and transmits to the Congress a notice stating that the emergency is to continue in effect beyond the anniversary date. In accordance with this provision, I have sent to the Federal Register for publication the enclosed notice, stating that the emergency caused by the lapse of the Export Administration Act of 1979, as amended, is to continue in effect for 1 year beyond August 17, 2012."

This is the twelfth in a series of routine perfunctory annual declarations under which Presidents Bush and Obama have maintained the export regulation regime. This regime implements the "Export Administration Act", which expired in 2001.

Some members of the House and Senate worked on enacting replacement legislation a decade ago. However, no replacement bill was enacted, and there has been little legislative activity since on this subject.

The Department of Commerce's (DOC) Bureau of Industry and Security (BIS) -- previously named the Bureau of Export Administration (BXA) -- continues to revise and enforce implementing regulations for dual use items, which include many information and communications technology products. These regulations pertain to, among other things, exports and "deemed exports" of computers, software, and encryption products. These regulations also regulate employment in some situations.

The export control regime is outdated, complex, burdensome, and harms the competitiveness of some US companies. The Obama administration has revised the regime administratively rather than legislatively. See, story titled "Obama Addresses Export Control Reform Process" in TLJ Daily E-Mail Alert No. 2,185, December 21, 2010.

See also, story titled "President Issues Another Routine Emergency Declaration to Continue Export Regulation Regime" in TLJ Daily E-Mail Alert No. 2,288, August 13, 2011.

2:00 PM. The U.S. Court of Appeals (FedCir) will hear oral argument in Apple v. Samsung Electronics, App. Ct. No. 2012-1507, an appeal from the U.S. District Court (NDCal) in the patent infringement case involving smart phones and tablet computers. At issue in this oral argument is whether the District Court should have enjoined sale of Samsung's Galaxy Nexus smart phone. Panel I. Location: Courtroom 201.

Deadline to submit to the Copyright Royalty Board (CRB) Petitions to Participate in, and filing fees for, the CRB's proceeding to determine the distribution of the digital audio recording technology royalty fees in the 2005, 2006, 2007 and 2008 Musical Works Funds. See, notice in the Federal Register, Vol. 77, No. 140, July 20, 2012, at Pages 42764-42765.

Deadline to submit comments to the Department of Health and Human Services' (DHHS) Agency for Healthcare Research and Quality (AHRQ) in response to its Request for Information (RFI) regarding current strategies and challenges regarding quality measurement enabled by health information technology (IT). See, notice in the Federal Register, Vol. 77, No. 140, July 20, 2012, Pages 42738-42740.

The Senate will meet at 10:00 AM in pro forma session.

10:00 AM - 12:00 PM. The Center for American Progress (CAP) will host a panel discussion titled "Comparing U.S., Chinese, and Indian Investments in the Next-Generation Workforce". The speakers will be Eric Hanushek (Stanford University), Governor Jack Markell (D-DE), Bob Carpenter (Chesapeake Beach Consulting), Marilyn Reznick (AT&T), and Ann O'Leary (CAP). See, notice. Location: CAP, 10th Floor, 1333 H St., NW.

1:00 - 2:30 PM. The American Bar Association (ABA) will host a webcast and telecast panel discussion titled "Mayo v. Prometheus: The Supreme Court's New Methodology for Analyzing Patent Eligibility". The speakers will be Robert Armitage (Eli Lilly), Thomas Krauss (USPTO), and Denise DeFranco (Finnegan Henderson). Prices vary. CLE credits. See, notice.

9:30 AM - 1:00 PM. The Department of Commerce's (DOC) National Telecommunications and Information Administration (NTIA) will hold one in a series of meetings regarding consumer data privacy in the context of mobile applications. See, notice in the Federal Register, Vol. 77, No. 149, Thursday, August 2, 2012, Pages 46067-46068. Location: Auditorium, DOC, Hoover Building, 14th Street and Constitution Ave., NW.

12:00 NOON. The World Wide Web Consortium's (W3C) Tracking Protection Working Group will meet by teleconference. The call in number is 1-617-761-6200. The passcode is TRACK (87225).

11:00 AM - 12:30 PM. The American Bar Association (ABA) will host a webcast and telecast presentation titled "Protecting Your Intellectual Property: Best Practices for China in 2012". The speaker will be James Zimmerman (Sheppard Mullin). Prices vary. CLE credits. See, notice.

2:00 - 4:00 PM. The Small Business Administration (SBA) will host a webcast program on the Small Business Innovation Research (SBIR) and Small Business Technology Transfer Program (STTR) reauthorization act. See, notice in the Federal Register, Vol. 77, No. 151, Monday, August 6, 2012, at Page 46909.

6:00 - 9:15 PM. The DC Bar Association will host a presentation titled "Federal Lobbying 2012: A Guide to Regulation and Compliance". The speaker will be Andrew Siff (Siff & Associates). 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.

Day one of a two day event hosted by the American Intellectual Property Law Association (AIPLA) titled "AIPLA Patent Prosecution Practical Patent Prosecution Training for New Lawyers". See, notice. For more information, contact aipla at aipla dot org or 703-415-0780. Location: Alexandria, VA.

Deadline to submit initial comments to the Federal Communications Commission (FCC) in response to the Wireline Competition Bureau's WCB) Public Notice [23 pages in PDF] regarding expanding FCC subsidies for rural health care providers to include broadband. The FCC released this item on July 19, 2012. It is DA 12-1166 in WC Docket No. 02-60. See, notice in the Federal Register, Vol. 77, No. 144, Thursday, July 26, 2012, at Pages 43773-43780.

The Senate will meet at 10:00 AM in pro forma session.

12:00 NOON - 1:30 PM. The DC Bar Association will host a presentation titled "Building Momentum: Advanced LinkedIn for Lawyers". The speaker will be Tasha Coleman (Upward Action). Free. No CLE credits. See, notice. For more information, call 202-626-3488. The DC Bar has a history of barring reporters from its events. Location: DC Bar Conference Center, 1101 K St., NW.

1:00 - 2:30 PM. The American Bar Association (ABA) will host a webcast and telecast panel discussion titled "The America Invents Act: The Boundaries of Prior Art". The speakers will be Steve Chang (Banner & Witcoff), Susanne Jones (O'Brien Jones), and Janet Hendrickson (Senniger Powers). Prices vary. CLE credits. See, notice.

Day two of a two day event hosted by the American Intellectual Property Law Association (AIPLA) titled "AIPLA Patent Prosecution Practical Patent Prosecution Training for New Lawyers". See, notice. For more information, contact aipla at aipla dot org or call 703-415-0780. Location: Alexandria, VA.

Day one of four of the Republican National Convention.

Deadline to submit comments to the Office of the U.S. Trade Representative (OUSTR) regarding the complaints filed with the World Trade Organization (WTO) by the US, Japan and EU against the People's Republic of China (PRC) regarding its rare earth materials export policies. See, notice in the Federal Register, Vol. 77, No. 146, Monday, July 30, 2012, at Pages 44706-44707.

8/16. The nation of Ecuador granted political asylum to Julian Assange, who founded WikiLeaks in 2006. He is currently in the United Kingdom (UK), hiding from UK authorities in the Ecuadoran embassy, to evade efforts by Sweden to extradite him pursuant to a warrant issued in connection an investigation of sexual assault allegations against him. UK Foreign Secretary William Haig stated at a news conference that UK remains obligated under law to extradite Assange to Sweden, and will not grant him safe passage out of the UK. See also, story titled "Wikileaks Is Running Out of Money" in TLJ Daily E-Mail Alert No. 2,409, July 18, 2012.

8/14. Rep. Cliff Stearns (R-FL), the Chairman of the House Commerce Committee's (HCC) Subcommittee on Oversight and Investigations, narrowly lost in the Republican primary election for the 3rd District of Florida. Following redistricting, Rep. Stearns ran as a candidate in a district with little overlap with his current district.

8/14. Sen. Herb Kohl (D-WI), the Chairman of the Senate Judiciary Committee's (SJC) Subcommittee on Antitrust, Competition Policy and Consumer Protection, is not running for election in November. Tommy Thompson, a former Governor of Wisconsin, and former Secretary of Health and Human Services, won the Republican Senate primary election on August 14. He will run against Rep. Tammy Baldwin (D-WI), whose current House district includes Madison and the University of Wisconsin at Madison. She is a member of the House Commerce Committee (HCC). Previously, she was a member of the House Judiciary Committee (HJC).

8/14. Sen. Joe Lieberman (D-CT) is not running for election in November. On August 14 Linda McMahon won the Republican Senate primary election, defeating former Rep. Chris Shays (R-CT). The Democratic candidate is Rep. Chris Murphy (D-CT). In 2010, Sen. Richard Blumenthal (D-CT) defeated McMahon for the seat previously held by for former Sen. Chris Dodd (D-CT), who is now head of the Motion Picture Association of America (MPAA). Sen. Lieberman is the Chairman of the Senate Homeland Security and Governmental Affairs Committee (SHSGAC), and sponsor of S 3414 [LOC | WW], a bill that would impose a cyber security regulatory regime. Two other members of the SHSGAC are not running for re-election, Sen. Susan Collins (R-ME) and Sen. Daniel Akaka (D-HI).

8/14. The Public Knowledge (PK) hired Christopher Lewis as VP of Governmental Affairs. He will replace Ernesto Falcon, who will become Special Advisor. Lewis previously worked at the Federal Communications Commission's (FCC) Office of Legislative Affairs. Also, the PK recently hired Bartees Cox as Communications Associate. He was previously an intern at the Free Press.

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