|News Briefs from
August 26-31, 2001
Solicitor General Files Amicus Brief in Festo Case
8/31. The Office of the Solicitor General
(OSG) filed its amicus
curiae brief with the Supreme Court
of the U.S. in Festo
v. Shoketsu Kinzoku Kogyo Kabushiki, a patent infringement
case. The OSG argued that the Appeals Court judgment should be vacated.
The U.S. Court of Appeals (FedCir) issued
its divided en banc opinion
on November 29, 2000, narrowing the doctrine of equivalents, which
prevents an accused infringer from avoiding liability for infringement by
changing only minor or insubstantial details of a claimed invention while
retaining the invention's essential identity. The Appeals Court sought to answer
several questions that remained following the Supreme Court's decision in Warner
- Jenkinson v. Hilton Davis Chemical, 520 U.S. 17 (1997). The Supreme Court
granted certiorari in the Festo case on June 18.
The OSG wrote in the amicus brief that the "doctrine of equivalents
provides that a product or process that does not literally infringe upon the
express terms of a patent claim may nevertheless be found to infringe if there
is an "equivalence" between the elements of the accused product or
process and the claimed elements of the patented invention. ... That doctrine is
limited by the concept of prosecution history estoppel, which recognizes that,
if a patent claim is amended during patent prosecution, the amendment may
curtail application of the doctrine of equivalents to the amended claim."
The OSG stated that the questions presented are "Whether an amendment of a
patent claim that narrows the scope of the claim for any reason related to the
statutory requirements for a patent gives rise to prosecution history estoppel
with respect to the amended portion of the claim" and "Whether an
amendment of a patent claim that gives rise to prosecution history estoppel
completely precludes invocation of the doctrine of equivalents for the amended
portion of the claim."
The OSG argued that Federal Circuit "correctly ruled that an amendment of a
patent claim that narrows the scope of the claim for reasons of patentability
gives rise to prosecution history estoppel with respect to the amended portion
of that claim." However, it continued that the Court "erred in ruling
that a patent claim amendment that gives rise to prosecution history estoppel
completely bars invocation of the doctrine of equivalents for the amended
portion of the claim." Hence, it argued that the judgment of the Court of
Appeals should be vacated.
DOJ Argues Supreme Court Should Deny Certiorari in Microsoft
8/31. The Department of Justice (DOJ) filed
with the Supreme Court of the United States its brief in opposition to
for writ of certiorari. Microsoft's petition raises the sole issue of
whether Judge Jackson's improper out of Court contacts warrant vacating Judge
Jackson's finding of fact and conclusions of law in their entirety.
The DOJ argues in its brief that Microsoft's petition should be denied for three
reasons. First, it argues that this is an interlocutory appeal in a case that
could later generate another petition for writ of certiorari; the Supreme Court
should not take interlocutory appeals.
Second, the DOJ argues that "Microsoft's assertion that the court of
appeals' decision conflicts with decisions of this Court and other courts of
appeals rests squarely on a mischaracterization of the court of appeals' ruling,
which simply applies the controlling authority, Liljeberg v. Health
Services Acquisition Corp., 486 U.S. 847 (1988), to the facts of this
Third, the DOJ argues that "the court of appeals' unanimous en banc
decision properly applied Liljeberg, which specifically recognizes that
courts of appeals have considerable discretion in resolving the factbound
question of the proper remedy for specific instances of judicial
Federal Reserve and Technology
8/31. Federal Reserve Board Vice
Ferguson gave a speech at a
conference sponsored by the Federal Reserve
Bank of Kansas City, in Jackson Hole, Wyoming. The speech was titled
"Technology, Information Production, and Market Efficiency." The
conference was titled "Economic Policy for the Information Economy."
See also, agenda,
with links to some of the presentations.
Ferguson reviewed a paper on the effects of information technology on markets,
which he summarized as follows: "Improvements in information technology --
most notably, the rapid growth of the Internet -- have made participating in the
market much easier and cheaper and, as a result, the market has drawn in many
new and unsophisticated investors. These "noise traders" cannot
differentiate between accurate and distorted information about a given company.
Thus, company managers see greater opportunity to boost their firm's stock price
by fooling investors through the release of distorted information -- and have a
strong incentive to do so because of the shift toward stock-based compensation
and the widespread use of equity financing in the "new economy." In
the end, according to the paper, more information is available, but its quality
has deteriorated, which reduces the benefit from information technology for
market efficiency." See, paper
[PDF] titled "Technology, Information Production, and Market
Efficiency," by Gene D’Avolio, Efi Gildor, and Andrei Shleifer.
Ferguson challenged the argument that "information technology has greatly
expanded the presence of uninformed investors in the equity market." He
stated that "households have been reducing the portion of their equities
that they hold directly and have increasingly invested through mutual funds and
variable annuities ... That is, households have been handing over more and more
of their equity portfolio to professional managers, who tend to be relatively
well informed investors."
He argued that instead, "The late 1990s were a period of optimism about the
prospects for the U.S. economy, reflecting the pickup in productivity growth
that was generated, in large part, by information technology. The resultant
optimism about the economy's growth prospects was accompanied by a complacent
attitude toward risk ..."
On a related topic, he stated that new information technologies have benefited
consumers. He stated that "new technologies have surely led to a general
increase in welfare. New delivery technologies, such as the Internet, when
combined with automated underwriting and credit scoring, have given borrowers
the opportunity to select from a broader set of providers of credit cards,
mortgages, and even some types of small business loans ..." He also praised
"web sites to allow Internet banking and software to permit PC
However, he also cautioned that "the implications of these newer delivery
channels for banking products other than mortgages and credit cards seem more
potential than real for the vast majority of bank retail customers." He
cited the statistic that "Only 6 percent of households reported having used
a computer to conduct business with a financial institution in 1998."
FCC Updates Licensing Records to Reflect Court Mandate In
8/31. The FCC announced that its
"Wireless Telecommunications Bureau will update its licensing records to
reflect the court's mandate" in NextWave v. FCC. The FCC added that
"The United States and the Commission have indicated their intention to ask
the Supreme Court of the United States to review the D.C. Circuit decision. In
addition, related litigation is pending in the Bankruptcy Court for the Southern
District of New York, Case No. 98 B 21529 (ASH); and there are potential or
ongoing related regulatory proceedings before the Commission. These litigation
and/or regulatory matters may affect the status of the involved licenses."
NextWave Communications obtained
spectrum licenses at FCC auctions in 1996. The FCC permitted NextWave to obtain
the licenses under an installment plan, thus creating a debtor creditor
relationship between NextWave and the FCC. NextWave did not make payments
required by the plan, and filed a Chapter 11 bankruptcy petition. The FCC was
blocked by the bankruptcy court, citing § 525 of the
Bankruptcy Code. The U.S. District Court (SNDY) affirmed. The U.S. Court of Appeals (2ndCir)
issued its order reversing and remanding the case on Nov. 24, 1999; it issued
explaining its reversal in May 2000. The FCC then re-auctioned this spectrum to
Verizon Wireless, VoiceStream and
other successful bidders, which intend to use it for 3G wireless, and other,
However, NextWave petitioned the FCC to reconsider its cancellation of its
licenses. The FCC refused, and NextWave petitioned for review by the Court of
Appeals in the District of Columbia. The DC Circuit ruled on June 22 that the
2nd Circuit had not already addressed NextWave's bankruptcy claims. It also
wrote in its opinion
that the FCC is prevented from canceling the spectrum licenses by § 525 of the
Bankruptcy Code. It wrote that the FCC "violated the provision of the
Bankruptcy Code that prohibits governmental entities from revoking debtors'
licenses solely for failure to pay debts dischargeable in bankruptcy. The
Commission, having chosen to create standard debt obligations as part of its
licensing scheme, is bound by the usual rules governing the treatment of such
obligations in bankruptcy." See, NextWave Personal Communications Inc. v.
FCC, 254 F.3d 130 (D.C. Cir. 2001).
Indictment Returned for Violation of Export Rules
8/31. A grand jury of the U.S.
District Court (NDCal) returned an indictment
[PDF] of Berkeley Nucleonics
Corporation (BNC) and three of its employees, David Brown, Richard Hamilton,
and Vincent Delfino, alleging violation of 18 U.S.C. § 371 and the Export
Administration Regulations regarding exports to India in violation of 50 U.S.C.
The indictment alleges that BNC and its employees solicited business for and
knowingly exported nuclear pulse generators and related parts to various
entities in India without the export license required by the Bureau of Export Administration of the
Department of Commerce. Jeff Cole and Candace Kelly are the Assistant U.S.
Attorneys who are prosecuting the case.
Bush Addresses Deployment of Broadband Internet Access
8/31. President Bush stated at a press conference that broadband deployment is
resulting from market activity, and that broadband access in rural areas will
come from "over the air" rather than wireline service.
President and Mrs. Bush held a press conference to announce revisions to the
White House web site at which President Bush was asked, "what role should
the federal government play in helping deploy high speed Internet access?"
He responded, "Well, a lot of that is going to be taking place through the
market. And technology is such that areas that might not get access quickly as a
result of no economies of purchase, or economies of scale, will be able to have
Internet access. I think, for example, of Crawford, Texas. It's a place where
you're not going to generally get a lot of fiber-optics, although I think there
may be some there as a result of Laura's and my presence. Hopefully that high
speed access will come as a result of -- over the air, as opposed to through
fiber-optics. And once we get over the air high speed access, then a lot of
rural America that heretofore hasn't had access will get it. The technologies
are evolving. One of my concerns, of course, is the economic slowdown will
perhaps slow down some of the progress made, as far as high speed access. And
we've done something about it. I'm going to remind Congress that they need not
overspend, and should not overspend. It's going to affect economic growth; that
all of us in Washington need to be thinking about how to grow the economy.
..." See, transcript.
People and Appointments
8/31. Scott Marcus was named Senior Advisor for Internet
Technology at the FCC. He was previously CTO of Genuity. The FCC stated in a release
[PDF] that his "research interests include the economics and public policy
implications of internet backbone interconnection, the measurement and
prediction of Internet usage, the management and operation of data networks, and
general data network design." He is also the author of Designing
Wide Area Networks and Internetworks: A Practical Guide (Amazon sales rank:
60,573). See also, Genuity
8/31. President Bush announced his intent to nominate Rockwell Schnabel
to be Representative of the U.S. to the European Union. He is currently
Co-Chairman of Trident Capital, a
private equity venture capital firm that focuses on information services
companies. It is based in Los Angeles, California. See, White
Xerox and CSU Settle
8/31. Xerox announced that it has reached a
settlement of its remaining claims against Copier Services Unlimited. See, Xerox
Copyright Office Releases DMCA Report
8/30. The Copyright Office
(CO) released its report
on the effects of Title 1 of the Digital Millennium Copyright Act (DMCA) and the
development of electronic commerce and associated technology on the operation of
§§ 109 and 117 of Title 17. The report also evaluates the relationship between
existing and emerging technology and the operation of those sections. The report
was required by § 104 of the DMCA.
Franchising for Profit
8/30. The U.S.
Court of Appeals (5thCir) issued its opinion
v. Williams, affirming a conviction of a city councilman, who as
a member of a local franchising authority, sought a cash bribe for voting for a
renewal of a cable TV franchise.
The Defendant, Robert Williams, was a City Councilman for the City of Jackson,
Mississippi. Time Warner sought a renewal of its cable TV franchise. Williams
sought $150,000 in cash from Time Warner for his vote. He was convicted of
conspiracy to commit extortion and solicitation of bribery payments. The Court
of Appeals affirmed.
CDT Releases Privacy Report
8/30. The Center for Democracy and Technology
(CDT) released a report
[7 MB in PDF] regarding the privacy practices of online financial services
providers. The CDT report states that out of 100 banks studied that offer their
customers the ability to open accounts online and use other banking services
online, only 22% provide their customers equally convenient online means of
preventing information sharing with other companies.
The CDT also submitted a complaint to the
Federal Trade Commission (FTC) in which it
stated that five mortgage companies (Advantage Mortgage,
Ameriwest Mortgage, Central New England
Mortgage, GM Mortgage,
and Online Mortgage
Corporation) are in violation of FTC regulations promulgated pursuant to the
Gramm Leach Bliley Act. The complaint states that these companies collect
personally identifiable financial information on their web sites in connection
with granting mortgages to consumers, but do also offer clear and conspicuous
notice of their privacy policies. The complaint also requests that the FTC
initiate an investigation of the privacy practices of the five companies.
EU Initiates Proceeding Against Microsoft
8/30. The European Commission announced that Microsoft "may have violated
European antitrust rules by using illegal practices to extend its dominant
position in the market for personal computer operating systems into the market
for low-end server operating systems. Low-end server systems are cheaper servers
usually used as file and print servers as well as Web servers. In a Statement of
Objections, the Commission also alleges that Microsoft is illegally tying its
Media Player product with its dominant Windows operating system. This Statement
of Objections supplements one sent to the company a year ago and adds a new
dimension to the Commission's concerns that Microsoft's actions may harm
innovation and restrict choice for consumers. A Statement of Objections is a
formal step in European antitrust proceedings, which does not prejudge the final
outcome." See, EU release.
Microsoft issued a release
in which it asserted that the EU's latest action is "a constructive step in
the ongoing dialogue on these issues." Microsoft also stated that it
"confirmed today in discussions with European Commission staff that the
Commission has no plans to seek to block the launch of Windows XP or any other
Microsoft product in Europe."
Jean Philippe Courtois, President of Microsoft EMEA, stated in the same release
that "We are confident that once it has completed its investigation, the
European Commission will be assured that we run our business in full compliance
with EU law".
Ken Wasch, President of the SIIA, an anti
Microsoft group based in Washington DC, stated that "The filing of this
case confirms that Microsoft's anti- competitive practices are not confined to
the desktop. Rather than replaying the debate about the desktop, applications
and the browser, the Commission has appropriately focused on the new challenges
resulting from Microsoft's leveraging its monopoly on the PC." See, SIIA release.
8/30. The U.S.
Court of Appeals (6thCir) issued its opinion
Hill Publications v. ABC, a case involving claims of copyright
infringement, violation of the Lanham Act, and other claims. The Appeals Court
affirmed the District Court's grant of summary judgment to defendant, ABC (dba
8/30. The USPTO published a notice
in the Federal Register that it is temporarily amending its rules regarding the
timing of national stage commencement in the U.S. for Patent Cooperation Treaty
(PCT) applications. It is amending its regulations to include the current
statutory provisions that define when national stage commencement occurs in an
application filed under the PCT. See, Federal Register, August 30, 2001, Vol.
66, No. 169, at Pages 45775 - 45777.
8/30. The USPTO published a notice
in the Federal Register regarding its notice of proposed rulemaking (NPRM)
proposing to amend its rules to make electronic filing of trademark documents
mandatory, subject to certain exceptions. Comments must be received by October
29, 2001. A public hearing will be held at 10:00 AM on October 12, 2001, in Room
911, Crystal Park 2, 2121 Crystal Drive, Arlington, Virginia. Requests to
present oral testimony are due by October 5, 2001. See, Federal Register, August
30, 2001, Vol. 66, No. 169, at Pages 45792 - 45797.
Sklyarov and Elcomsoft Indicted
8/28. A grand jury of the U.S.
District Court (NDCal) returned a five count indictment
[PDF] against Elcom Ltd. aka Elcomsoft Co. Ltd. and Dmitry Sklyarov for criminal
violations of copyright law in connection with their marketing and sale of a
program that circumvents Adobe's e-book reader. Elcomsoft and Sklyarov are
charged with violation of the anti circumvention section of the Digital
Millennium Copyright Act (DMCA), 17 U.S.C. § 1201.
Adobe Systems makes the eBook Reader, a
program which can read books in an electronic format named eBook. The program is
downloadable at Adobe's web site. Users can then purchase encrypted electronic
books in eBook format from online bookstores, such as Amazon.com, and read them
with the eBook Reader. The books are encrypted to protect copyright interests.
Elcomsoft and Sklyarov produced software that enables people to copy and read
these electronic books without paying.
The indictment states that Elcomsoft, a software company based in Moscow,
Russia, and Sklyarov, an employee of Elcom, designed, produced, and marketed a
program named the Advanced eBook Processor (AEBPR). This program circumvents the
Adobe Acrobat eBook Reader by removing all limitations on an ebook purchaser's
ability to copy, distribute, and print ebooks.
Count One alleges conspiracy to traffic in technology primarily designed to
circumvent and marketed for use in circumventing, technology that protects a
right of a copyright owner in violation of 18 U.S.C. § 371. Counts Two and
Three both allege trafficking in technology primarily designed to circumvent
technology that protects a right of a copyright owner in violation of 17 U.S.C.
§ 1201(b)(1)(A) and 18 U.S.C. § 2. Count Four and Five both allege trafficking
in technology marketed for use in circumventing technology that protects a right
of a copyright owner in violation of 17 U.S.C. § 1201(b)(1(C) and 18 U.S.C. §
Sklyarov was previously charged by criminal
complaint [PDF] with a single count of trafficking in a product designed to
circumvent copyright protection measures, on July 17.
Both defendants are scheduled to be arraigned at 9:30 AM on August 30, 2001
before Judge Seeborg.
This is case number CR-01-20138. Assistant U.S. Attorneys Scott Frewing and
Joseph Sullivan are prosecuting the case. See also, USAO
Copyright Office Seeks Comments on NPRM on Compulsory
8/28. The Copyright Office (CO)
published a notice
in the Federal Register seeking public comments on proposed amendments to the
regulations governing the content and service of certain notices on the
copyright owner of a musical work. The notice is served or filed by a person who
intends to use the work to make and distribute phonorecords, including by means
of digital phonorecord deliveries, under a compulsory license, pursuant to 17 U.S.C. § 115.
Comments are due by September 27, 2001. See, Federal Register, August 28, 2001,
Vol. 66, No. 167, Page 45241 - 45245.
10th Circuit Rules in Stock Options Case
8/28. The U.S.
Court of Appeals (10thCir) issued its opinion
v. WorldCom, a dispute over stock option agreements. Mauldin
entered into four stock option agreements with MFS Intelenet, which was
subsequently acquired by WorldCom. Mauldin sought to exercise these options.
WorldCom refused. Mauldin filed a complaint in U.S. District Court (NDOkla)
against WorldCom. The District Court granted summary judgment to WorldCom.
Mauldin brought the appeal. The Court of Appeals reversed.
8/28. The NTIA is
advertising to fill the position of Associate Administrator for
Telecommunication Sciences and Director of the Institute for Telecommunication
Sciences in Boulder, Colorado. The position pays $122,083 to $133,700 per year.
See, job announcement.
5th Circuit Upholds Protectionist Car Dealership Law
8/27. The U.S.
Court of Appeals (5thCir) issued its opinion
Motor Company v. Texas, upholding the constitutionality of a
protectionist Texas statute backed by car dealerships that prevents the car
makers from selling cars over the Internet. The Court rejected a Commerce Clause
challenge to the statute by 3 to 0. However, Judge Edith Jones condemned the
existing precedent, argued that the statute harms consumers, and invited the
Supreme Court to review the case.
Background. Electronic commerce provides the potential for producers of
goods or services to reduce or remove the role of dealers, brokers and other
middlemen. It can enable producers to interact directly with customers, thereby
enabling consumers to realize significant savings. In some situations, middlemen
who risk losing some or all of their role have resorted to seeking legislative
or regulatory protection. In the present case, auto dealers threatened by
competition from Internet sales have lobbied for, and obtained, legislative
protection. In Texas, for example, one statutory section prohibits the selling
cars without a dealer's license, while its companion section prohibits car
makers from obtaining dealer's licenses.
Facts. Ford marketed pre-owned vehicles in Texas via a web site. On November 2, 1999, the Texas
Motor Vehicle Division filed an administrative complaint against Ford with the
Texas Motor Vehicle Board for selling cars without a dealer's license.
District Court. Ford filed a complaint in U.S District Court (WDTex) against the
state of Texas alleging that Texas' dealership statute violates Ford's rights
under the U.S. Constitution, including the dormant Commerce Clause, the speech
clause of the First Amendment, and the Equal Protection and Due Process clauses
of the 14th Amendment. Ford also asserted that the statute is unconstitutionally
vague. Both parties filed motions for summary judgment. The District Court
granted Texas's motion for summary judgment as to all of Ford's claims.
Dormant Commerce Clause. The Commerce Clause, at Art. I, Section 8,
provides that "The Congress shall have Power ... To regulate Commerce with
foreign Nations, and among the several States ..." The "dormant
Commerce Clause" is the judicial concept that the Commerce Clause also
blocks states from regulating in a way that materially burdens or discriminates
against interstate commerce. The Appeals Court held that the Texas statute does
not discriminate against interstate commerce. It relied heavily on a case
growing out of the 1973 oil embargo and resulting shortage -- Exxon v. Maryland,
437 U.S. 117 (1978). During the 1973 shortage gas stations owned by producers
and refiners received preferential treatment. Afterwards, Maryland passed a law
prohibiting producers and refiners from operating gas stations in Maryland. The
Supreme Court found this to be a bar on vertical integration that did not burden
interstate commerce. It rejected a Commerce Clause challenge.
In the Ford case, the Appeals Court reasoned that Exxon is controlling. It
elaborated that the dormant Commerce Clause only bars state discrimination
against out of state businesses. Discrimination against a class of businesses
that is defined by some characteristic other than its state is not violative of
the dormant Commerce Clause. The Court wrote that the Texas statute "does
not discriminate based on Ford's contacts with the State, but rather on the
basis of Ford's status as an automobile manufacturer." Moreover, it
"does not protect dealers from out-of-state competition, it protects
dealers from competition from manufacturers."
District Court Affirmed. The Appeals Court also rejected Ford's argument
that the Texas statute limits speech -- i.e., the content of its web site.
Similarly, it rejected the remaining claims. The District Court was affirmed in
full. The opinion was written by Judge Benavides. Judges DeMoss and Jones
Edith Jones Invites Supreme Court Review. Jones wrote a
"concurring" opinion which reads more like a dissent. She wrote that
she concurred only because Exxon v. Maryland "compelled" that result.
She continued that "Exxon seems woefully out of step with the
Court's more recent cases." She also wrote that "Texas's outright
prohibition on retail competition from out-of-state auto manufacturers is about
as negative toward interstate commerce as legislative action can get. If, as the
Court says, its negative commerce clause jurisprudence intends to prevent
"economic protectionism" of local businesses, ... , and to stop states
from imposing higher (in this case prohibitive) costs on products from
out-of-state sources, ... , then Ford's dealer-cooperative, consumer-friendly
program ought not be stymied by parochial state legislation. It should be
obvious that the flow of interstate goods is diminished when barriers to entry
totally prevent fair competition by a class of potential distributors: the
favored local distributors' price and service incentives become less keenly
competitive, prices rise, and overall sales will decline from the free-market
equilibrium point. Since this Texas statute appears to reflect a genre of state
laws favoring local automobile dealers over out-of-state manufacturers, perhaps
the Supreme Court will give us further guidance."
The elder President Bush had once seriously considered Judge Jones, now 52, for
a seat on the Supreme Court. Former President Reagan appointed her to the
Appeals Court at the age of 36. She is a graduate of the University of Texas.
3rd Circuit Reverses Gag Order in Key Logger System Case
8/27. The U.S.
Court of Appeals (3rdCir) issued its opinion in USA
v. Scarfo, regarding "a lawyer's right to make extrajudicial
statements to the press relating to a former client's pending criminal
case." This opinion is noteworthy because the underlying case, which
involves government search and seizure of information from personal computers,
has attracted wide attention from technology writers and legal scholars, their
readers, and practitioners.
Background. Nicodemo Scarfo is an encryption savvy mobster who is charged
with various illegal gambling acts. The FBI obtained Scarfo's encryption
passphrase by surreptitiously installing on his personal computer the FBI's
"Key Logger System", which records keystroke entries. Most recently,
the FBI has invoked the Classified Information Procedures Act, Title 18, U.S.C,
Appendix III, to avoid producing information about the "Key Logger
System" to a Scarfo. He seeks discovery regarding the FBI's "Key
Logger System" to support his motion to suppress evidence gathered as a
result of use of the system. His first attorney in this case, Donald Manno, was
disqualified by the District Court. Manno subsequently talked to the
Philadelphia Enquirer about legal and privacy issues raised by the FBI's
"Key Logger System."
Gag Order. The Court then ordered that: "no lawyer representing or
who has represented a party in this criminal matter could make any extrajudicial
statement to the press regarding legal issues which may be raised concerning
electronic or computer surveillance techniques, which a reasonable person would
expect to be disseminated by means of public communication, which he knows or
reasonably should know will have a substantial likelihood of causing material
prejudice to the determination of the anticipated or filed pre-trial motion, or
the conducting of a fair trial in the case."
Appeals Court. The Appeals Court reversed the gag order. It wrote that
the attorney's "comments on an interesting legal issue did not pose a
threat to the fairness of the trial or to the jury pool. Nor did the District
Court identify a risk of a carnival-type atmosphere in the case, although
organized crime cases often draw massive public interest. ... There having been
no identifiable prejudice or risk of prejudice, the gag order was
James Bond 007: Doctrine of Laches Bars Claims of Infringement
8/27. The U.S. Court of Appeals (9thCir)
issued its opinion
[PDF] in Danjaq v. Sony, a case
applying the equitable doctrine of laches to ancient claims of infringement of
intellectual property rights in the name James Bond. The Appeals Court affirmed
the District Court ruling that the doctrine of laches bars the plaintiffs' forty
year old claims.
This is a long but fascinating opinion that recounts the history and content of
the James Bond books and screenplays, and the law of the doctrine of laches in
the context of intellectual property claims.
Standard Files Chapter 11 Bankruptcy Petition
8/27. Standard Media International, the parent company of the Industry Standard
and TheStandard.com, filed a Chapter
11 petition in U.S. Bankruptcy Court (NDCal).
Standard Media also stated that "The court will now oversee the sale of
Standard Media's assets, which include the magazine's subscriber list ..."
states that "The Industry Standard will not release your personal data to
anyone else without your consent."
Tristani to Leave FCC
8/27. FCC Commissioner Gloria
Tristani announced that she will leave the FCC, effective September 7, 2001.
release. Tristani is a Democrat from New Mexico who was appointed in 1997 by
former President Clinton. She will return to New Mexico, where she will likely
run for public office. She has spoken in the past about challenging Rep. Heather Wilson (R-NM), who sits on
the House Commerce Committee and
its Telecom Subcommittee. More recently, she has spoken about running against Sen. Pete Domenici (R-NM).
Tristani was generally supportive of former Chairman William Kennard. She
distinguished herself from other Commissioners by promoting the V-Chip, and
constantly scolding radio and TV broadcasters for indecency, violence and lack
of diversity in their programming. She also outraged religious broadcasters by
seeking to limit their eligibility for educational licenses. She also was the
most consistent opponent of media consolidation.
Tristani was also a supporter of the e-rate subsidy program, universal service
generally, and programs to increase the used of telecommunications services in
Indian country specifically.
There are currently three Republicans (Powell, Martin, and Abernathy) and two
Democrats (Copps and Tristani) on the FCC. Tristani's departure will not upset
the Republican majority. By law, President Bush must nominate a Democrat, who
must be confirmed by the Senate.
FCC Commissioner Gloria Tristani gave a speech in
Albuquerque, New Mexico, on August 24. She complained about obscenity on
broadcast radio, the lack of Hispanic characters on broadcast TV, and the
"digital divide" in Internet access.
Spread Spectrum Devices
8/27. August 27 was the deadline to submit comments to the FCC in its further
notice of proposed rule (FNPRM) making of May 10 regarding spread spectrum
devices. See, Further
Notice of Proposed Rule Making and Order, adopted by the FCC on May 10,
2001, and released on May 11, 2001. This is the proceeding titled "In the
Matter of Amendment of Part 15 of the Commission's Rules Regarding Spread
Spectrum Devices" and numbered ET Docket No. 99-231.
This FNPRM proposes to amend Part 15 of the FCC's rules to improve spectrum
sharing by unlicensed devices operating in the 2.4 GHz band (2400 - 2483.5 MHz),
provide for introduction of new digital transmission technologies, and eliminate
unnecessary regulations for spread spectrum systems. Specifically, this FNPRM
proposes to revise the rules for frequency hopping spread spectrum systems
operating in the 2.4 GHz band to reduce the amount of spectrum that must be used
with certain types of operation, and to allow new digital transmission
technologies to operate pursuant to the same rules as spread spectrum systems.
It also proposes to eliminate the processing gain requirement for direct
sequence spread spectrum systems, which will provide manufacturers with
increased flexibility and regulatory certainty in the design of their products.
The FCC published comments in its web site. See, for example, comment
[PDF] submitted by Apple Computer, comment
[PDF] submitted by Intel, comment
[PDF] submitted by Texas Instruments, and comment
[PDF] submitted by IEEE 802.
SEC Files Securities Fraud Complaint
8/27. The SEC filed a civil complaint in
U.S. District Court (DOre)
against Alpha Telecom and others alleging violation of federal securities laws
in connection with a fraudulent offering of securities that raised about $100
Million. The District Court issued a temporary restraining order halting
operations by defendants.
The defendants are Alpha Telecom Inc., American Telecommunications Company Inc.,
Strategic Partnership Alliance LLC, SP Marketing LLC, Paul Rubera, Robert
McDonald, Ross Rambach, and Mark Kennison. The SEC stated that defendants raised
at least $100 Million from over 7,000 investors for purported investments in pay
telephones, which are actually a Ponzi scheme. The District Court (1) granted
the SEC's motion for a TRO (2) ordered appointment of a receiver, (3) froze
assets, (4) prohibited destruction of documents, (5) ordered an accounting, and
(6) granted expedited discovery. See, SEC release.
This is case number CV-01-1283 HA.
8/27. The USPTO published in notice
in the Federal Register requesting comments on issues associated with the
development of a plan to remove the patent and trademark classified paper files
from the USPTO's public search libraries. Comments are due by September 26,
2001. See, Federal Register, August 27, 2001, Vol. 66, No. 166, at Pages 45012 -
8/27. Arif Hyder Ali joined the Houston office of the law firm of Fulbright & Jaworski as counsel. He
previously was senior counsel at the Word
Intellectual Property Organization's (WIPO) Arbitration and Mediation
Center. He will focus on international commercial arbitration, alternative
dispute resolution, representations before inter-governmental tribunals and
organizations and dispute resolution involving information and communications
technologies and the Digital Economy. See, F&J
8/27. A jury of the U.S.
District Court (CDCal) convicted Craig Smith of obstructing an investigation
by the SEC
into alleged insider trading of stock in Ancor Communications. See, SEC release.
Go to News Briefs for August 21-25, 2001.