|News from September
House Subcommittee Holds Hearing on DTV Transition
9/25. The House Commerce Committee's
Subcommittee on Telecommunications and the Internet held a hearing on the
transition to digital television. See, draft of
proposed bill [16 pages in PDF] and summary of draft
See also, prepared testimony of witnesses: Robert
Wright (NBC), Richard Lewis (Zenith Electronics Corp.), Michael
Fiorile (Dispatch Broadcast Group, on behalf of the NAB), Michael
Willner (Insight Communications, on behalf of the NCTA), Lana
Corbi (Crown Media USA, on behalf of the NCTA), Jim
Gleason (Cable Direct, on behalf of the American Cable Association), Alan
McCollough (Circuit City Stores, for the Consumer Electronics Association), Richard
Lewis (Association of Public Safety Communications Officals International), Thera
Bradshaw (Association of Public Safety Communications Officials), and Gene
Kimmelman (Consumers Union).
House Subcommittee Holds Hearing on Check Clearing and Tech
9/25. The House Financial Services
Committee's Subcommittee on Financial Institutions held a hearing on HR 5414,
the Check Clearing for the 21st Century Act.
HR 5414 was introduced on September 19 by Rep. Mike Ferguson (R-NJ). It would
update banking laws by giving electronic versions of checks the same legal
validity as paper checks.
the Vice Chairman of the Federal
Reserve Board (FRB), stated in his prepared
testimony that the bill "removes existing legal barriers to the use of
new technology in check processing and holds the promise of a more efficient
check collection system."
He said that while "Check processing is far more efficient than it once was
... Legal impediments, however, have prevented the banking industry from fully
using these new electronic technologies, such as digital imaging, to improve
check processing efficiency and provide improved services to customers."
Ferguson elaborated. "This is because existing law requires that the
original paper checks be presented for payment unless the banks involved agree
otherwise. ... Therefore, legal changes are needed to facilitate the use of
technologies that could improve check processing efficiency, which should lead
to substantial reductions in transportation and other check processing
He added that "The act might also better position banks to provide new and
improved services to their customers. For example, banks might allow some
corporate customers to transmit their deposits electronically. Because the act
will likely encourage greater investments in image technology, banks might also
be able to expand their customers' access to enhanced account information and
check images through the Internet."
Gail Hillebrand of the Consumers Union
criticized the bill. She said that it would "make it impossible for the
estimated 45.8 million U.S. households who now get their paper checks back to
get all their paper checks back every month" and "not effectively
protect consumers from new errors that could be caused by electronic imaging of
checks." She also argued that "Information on the electronic image of
a check could be used to invade consumer privacy."
See also, prepared statements of witnesses in PDF: Roger Ferguson
(Federal Reserve Board), Curtis Hage
(Home Federal Bank), Joel
Biggerstaff (AirNet Systems), Lee Schram
(NCR Corporation), Robert Fenner
(National Credit Union Administration), David Walker
(Electronic Check Clearing House Organization), and Gail Hillebrand
House Subcommittee Holds Hearing on Local Tax Exemption for
9/25. The House Judiciary Committee's
Subcommittee on Commercial and Administrative Law held a legislative hearing on HR 4869,
the "Satellite Radio Freedom Act", and HR 5429,
the "Satellite Services Act of 2002".
Rep. Tom Davis (R-VA) introduced
HR 5429 on September 23. It would provide that "A provider of direct
to subscriber satellite service shall be exempt from the collection or
remittance, or both, of any tax or fee imposed by any local taxing jurisdiction
on direct to subscriber satellite service".
Rep. Davis stated that "Satellite television services have been with us for
a number of years, and we are now seeing the emergence of satellite radio
service providers. With satellite radio, new benefits arise. Signals can be
received by listeners in their vehicles, not only at home. In addition, since
this service is available nationwide, it has the ability to aggregate small,
dispersed listener populations, making niche educational, ethnic, religious, or
specialized music programming economically feasible.
"the extraordinary administrative obstacle that would arise if such
providers were forced to collect and remit local taxes in approximately 15,000
different jurisdictions. This reality has already been recognized in reference
to satellite television, and appropriate legislative steps have been
taken." Davis stated that currently Section 602 of the Telecom Act provides
an exemption for satellite TV, but that "additional legislation is required
to include satellite radio and certain other satellite programming services that
may evolve in the future".
The bill has also been referred to the House Commerce Committee, of which
Rep. Davis is a member.
Copps Addresses Media Ownership
9/25. Federal Communications Commission (FCC)
Commissioner Michael Copps
gave a speech
in Washington DC in which he addressed the FCC's review of all of its media
ownership rules, the public interest obligations of digital television
broadcasters, and broadband as a civil right.
He said that "Two weeks ago the Commission commenced a far reaching review
of all our media ownership rules. This was done in the context of the
Congressionally mandated biennial review of FCC ownership rules, and also as a
result of some occasionally curious court decisions mandating further review of
He said that "At stake is how this industry is going to look in the next
generation and beyond. At stake are core values of localism, diversity,
competition and maintaining the multiplicity of voices and choices that
undergird our precious marketplace of ideas and that sustain American democracy.
At stake ... is equal opportunity writ large -- the opportunity to hear and be
heard; the opportunity to make this country as open and diverse and creative as
it can possibly be; and the opportunity for jobs, career advancement, promotion
and ownership in our media industries."
Copps also argued that access to broadband is a civil right. He stated that
"Those who have access to advanced communications like broadband in this
new century will win. Those who don’t will lose. For my part, I don’t think
it exaggerates a bit to characterize access to modern communications in this
modern age as a civil right. But civil rights always have to be won, don’t
they? Herein, perhaps, is our next great challenge." See also, release
Former Homestore.com Execs Charged
9/25. The Office of the U.S. Attorney for the Central District of California
filed a criminal information in U.S. District Court (CDCal) charging
John Giesecke, Joseph Shew and John Desimone. The three are former executives of
Homestore.com, an Internet provider of
real estate listings.
The information charges Giesecke and Shew with conspiracy to commit securities
fraud in connection with a scheme to fraudulently inflate the earnings of
Homestore.com. The information also charges Giesecke with wire fraud, and
Desimone with insider trading. The three also entered into plea agreements with
the Department of Justice whereby they agreed to plead guilty. See, DOJ release
by Attorney General John
In addition, the Securities and Exchange
Commission (SEC) filed a civil complaint in U.S. District Court (CDCal) charging
John Giesecke, Joseph Shew and John Desimone with securities fraud. See also, SEC release.
9/25. Rep. Judy Biggert (R-IL), Rep. Carolyn Maloney (D-NY), and
others, introduced HR 5457, a bill to amend the Gramm Leach Bliley Act to
exempt attorneys from the privacy provisions of that Act. The bill was referred
to the House Committee on Financial Services.
9/25. Sen. Tim Johnson (D-SD) introduced S 3006, a bill pertaining to
Internet gambling. It was referred to the Senate Judiciary Committee.
9/25. The Federal Communications Commission
(FCC) approved Verizon's Section 271
application to provide in-region, interLATA service in the states of Delaware
and New Hampshire. See, FCC release.
9/25. The General Accounting Office (GAO)
released a report [105
pages in PDF] titled "Information Management: Update on Implementation of
the 1996 Electronic Freedom of Information Act Amendments".
9/25. The U.S.
Court of Appeals (4thCir) issued its opinion [17
pages in PDF] in In
Re Carefirst of Maryland, a trademark infringement and unfair
competition case. The Appeals Court did not reach the merits. It dismissed the
appeal and petition for writ of mandamus as interlocutory.
NTIA Requests More Comments on E-SIGN Act
9/24. The National Telecommunications and
Information Administration (NTIA) published a notice
in the Federal Register that it is seeking public comments on the product recall
notices exception to the E-SIGN Act.
The Electronic Signatures in Global and National Commerce (E-SIGN) Act provides,
at Section 101, for the acceptance of electronic signatures in interstate
commerce, with certain enumerated exceptions. Section 103 of the Act provides
that "The provisions of section 101 shall not apply to ... (2) any notice
of ... (D) recall of a product, or material failure of a product, that risks
endangering health or safety". The Act also requires the NTIA to review,
evaluate and report to Congress on each of the exceptions.
The deadline to submit written comments to the NTIA regarding the product recall
notices exception is November 25, 2002. See, Federal Register, September 24,
2002, Vol. 67, No. 185, at Pages 59828 - 59830.
On September 3, the NTIA published a pair of notices in the Federal Register
regarding two other exceptions -- court records and hazardous materials notices.
The deadline for comments on those exceptions is November 4. See also, NTIA release,
in Federal Register, September 3, 2002, Vol. 67, No. 170, at Pages 56277 -
56279, regarding court records, and notice
in Federal Register, September 3, 2002, Vol. 67, No. 170, at Pages 56279 -
56281, regarding hazardous materials notices.
9/24. The House Commerce
Committee's Subcommittee on Commerce, Trade, and Consumer Protection held a
hearing on HR 4678,
the Consumer Privacy Protection Act of 2002, sponsored by Rep. Cliff Stearns (R-FL). See, opening
statement of Rep. Stearns, and opening
statement of Rep. Billy Tauzin
(R-LA), the Chairman of the full Committee. See also, prepared statements of
Palafoutas (AeA), Philip
Servidea (NCR, on behalf of the Computer Systems Policy Project), John
Schall (National Business Coalition on E-Commerce and Privacy), Rebecca
Whitener (EDS Security & Privacy Services), Paul
Misener (Amazon), Jennifer
Barrett (Acxiom), and Marc
9/24. The House Commerce Committee's
Subcommittee on Oversight and Investigations held a hearing titled "Capacity
Swaps by Global Crossing and Qwest: Sham Transactions Designed to Boost
Revenues?" See, prepared testimony of witnesses: Patrick
Joggerst (formerly with Global Crossing), Roy
Olofson (formerly with Global Crossing), Robin
Szeliga (Qwest Communications), Jackie
Armstrong (Global Crossing), Greg
Casey (formerly with Qwest), Kym
Smiley (formerly with Qwest), and Ken
Floyd (FLAG Telecom).
PPI Report Advocates Government Action to Boost Broadband
9/24. The Progressive Policy
Institute (PPI), a Democratic party think tank, released a report [36
pages in PDF] titled "Unleashing the Potential of the High Speed Internet:
Strategies to Boost Broadband Demand".
The report states that "most people who are able to subscribe to a home
broadband connection choose not to do so. The reason is simple: Most Americans
feel that the current offerings on the Internet do not justify paying two or
three times more for a broadband connection than they do for a dial-up
connection. Because of the low take-up rate, providers of advanced broadband
connections have little economic justification to engage in the large scale
rollout that could drive prices down. Likewise, providers of services requiring
broadband connections have little incentive to roll these out, given the low
take up rate of broadband."
The report calls this a "chicken or egg conundrum"; moreover, it
states that solving this conundrum should be a goal of public policy.
The report argues that "governments at all levels should pursue policies
that: Encourage greater Internet penetration and more robust use by expanding
e-commerce and e-government ... Encourage the availability of digital content
... Encourage the development and deployment of transformative
The Report also offers many specific policy recommendations. It argues that
government should "Oppose actions designed to protect the status quo
against e-commerce competition and resist efforts to prevent consumers from
capturing the savings realized by online transactions."
It also states that government should "Support digital transformation of
industries by calling for government agencies to examine how their procurement,
regulatory, and other functions can speed the digitization of the sectors they
The report also recommends that the Congress should pass the Driver’s License
Modernization Act, the E-Government Act of 2002, and "appropriate federal
privacy and spam legislation while encouraging technologies that empower users,
such as the Platform for Privacy Preferences (P3P) and the Internet Content
Rating Association (ICRA) rating system".
In the area of encouraging the availability of digital content, the report
recommends that the government "Harmonize the royalties paid by terrestrial
broadcasters and webcasters and simplify the process for collecting and
distributing royalties", give $50 Million to PBS for webcasting their
shows, establish a "National Digital Lending Library", and fund
Finally, the report advocates "passing telework incentive legislation;
ensure that home offices are not subject to workplace regulations; and develop
telework programs for government employees". It also advocates legislation
to make it easier for distance learning to qualify for federal support.
The report was written by Robert Atkinson, Shane Ham, and Brian Newkirk.
FCC Media Ownership NPRM Seeks Comments on Impact of Internet
9/24. The Federal Communications
Commission (FCC) finally released its Notice
of Proposed Rulemaking (NPRM) [68 pages in PDF] regarding its comprehensive
review of the FCC's various media ownership rules. The FCC it announced this
NPRM back at its September 12 meeting. The document seeks public comment on
hundreds of specific questions. One theme that runs through many of the
questions is what impact does the Internet now have on achieving the FCC's goals
of promoting diversity, competition, and localism in its various ownership
rules. See, full story.
GAO Releases Report on PR China's Membership in WTO
9/24. The General Accounting Office (GAO)
released a report [81
pages in PDF] titled "World Trade Organization: Selected U.S. Company Views
about China's Membership".
The GAO conducted a survey of U.S. companies to analyze their view regarding
"(1) the importance of WTO related commitments to their business operations
in China, (2) the anticipated effects of China’s WTO related reforms on their
businesses, and (3) China's prospects for implementing these reforms."
The GAO found that most respondents believe that China's WTO commitments are
important to their companies. The GAO reported that "Respondents identified
many rule of law related reforms as more important than other reforms.
Specifically, three quarters of the respondents selected intellectual property
rights; consistent application of laws, regulations, and practices; and
transparency of laws, regulations, and practices as the most important
commitment areas for their companies. Company representatives that we
interviewed also explained the importance of other reforms, including reductions
to market access barriers (such as tariffs and product quotas) and investment
related measures for their future operations in China."
Out of the thirty WTO related commitments areas listed in the survey, more
respondents identified intellectual property rights as important than any other
The GAO also reported that "Respondents expected many of China's WTO
related commitment areas to be relatively difficult for Chinese officials to
implement". In particular, "U.S. companies expected rule of law
related commitment areas regarding consistent application of laws, regulations,
and practices, and intellectual property rights to be the most difficult areas
to carry out."
191 out of 551 companies responded to the GAO's survey. The report does not
identify the companies that participated in the survey.
The report was prepared for Sen. Max Baucus
(D-MT), the Chairman of the Senate
Finance Committee (SFC), Sen. Charles
Grassley (R-IA), the ranking Republican on the SFC, Rep. Bill Thomas (R-CA), the
Chairman of the House Ways and Means
Committee (HWMC), and Rep. Charles
Rangel (D-NY), the ranking Democrat on the HWMC.
People and Appointments
9/24. Verizon named Kathryn Brown
SVP for Public Policy Development and International Government Relations. She is
currently a partner in the law firm of Wilmer
Cutler & Pickering. She was previously Chief of Staff of the Federal Communications Commission (FCC) and Chief
of the FCC's Common Carrier Bureau during the chairmanship of William Kennard.
She will start at Verizon on October 15.
9/24. Sanjay Kumar, P/CEO of Computer Associates
International, gave a speech regarding
corporate governance and financial reporting.
9/24. Kevin Clark, a former VP of Sales at Critical Path, plead guilty in U.S. District Court (NDCal) to insider
trading in violation of 15 U.S.C. § 78j(b), 15 U.S.C. § 78ff(a), and 17 CFR
240.10b-5. See, USAO
9/24. The U.S.
Court of Appeals (3rdCir) issued its opinion [8 pages
in PDF] in Nextel
v. City of Margate, a dispute over Nextel's construction of a telecommunications
facility atop a condominium building. Nextel filed a complaint in U.S. District Court (DNJ) against the
City of Margate and others seeking relief under 47 U.S.C. § 332(c)(7)
following Margate's efforts to reopen hearings on Nextel construction of
previously approved facilities. The District Court denied Nextel's motion for
preliminary injunction. The Appeals Court dismissed the appeal, and vacated the
District Court's order, for lack of ripeness, with further instructions to
dismiss the complaint, without prejudice.
Important Breaking News
9/24. The Federal Trade Commission (FTC)
announced that it will introduce Dewie The Turtle,
its "Internet security mascot", at the Privacy 2002 conference on
September 26 in Cleveland, Ohio. See, FTC release. FTC
officials have not commented publicly on why McGruff The Crime Dog was passed
over for the job. The appointment does not require Senate confirmation.
9th Circuit Rules in US West v. Jennings
9/23. The U.S.
Court of Appeals (9thCir) issued its opinion
[24 pages in PDF] in US West
v. Jennings, an appeal from a ruling of the District Court
regarding various interconnection agreements between an ILEC and CLECs
arbitrated by a state PUC. The Appeals Court affirmed in part and reversed in
Background. US West (now Qwest) is
the incumbent local exchange carrier (ILEC) in the state of Arizona. Following
passage of the Telecommunications Act of 1996, US West failed to negotiate
interconnection agreements with competitive local exchange carriers (CLECs)
operating in Arizona. It petitioned the Arizona
Corporations Commission, which is the public utilities commission (PUC) in
Arizona, to arbitrate. The ACC arbitrated various interconnection agreements.
District Court. Various lawsuits were then filed in U.S. District Court (DAriz)
challenging these agreements. These lawsuits were consolidated. The District
Court affirmed some provisions of the various interconnection agreements, and
Appeals Court. These consolidated appeals followed. The Appeals Court
affirmed in part and reversed in part. This appeal raised the questions of
whether the terms of the interconnection agreements are consistent with the 1996
Act, and whether Federal Communications Commission
(FCC) regulations that took effect after the ACC's decisions are applicable.
Appeals Court held that the FCC regulations are applicable, thus reversing the
District Court on this issue. The Appeals Court then went on to apply those
regulations to the provisions of the interconnection agreements, including
provisions pertaining to: cable sheath mileage; four wire loop price; geographic
deaveraging; conditions on access to subloops; reciprocal access to poles,
ducts, conduits, and rights of way; collocation of remote switching units;
single points of access; tandem switch rates; conditions on resale of centrex
services; non-recurring charges for unbundled network elements; and conditions
on access to dark fiber.
VOD Over IP Company Files Antitrust Suit Against AOLTW, Sony,
9/23. Intertainer filed a
complaint [68 pages in
PDF] in U.S. District Court (CDCal)
against AOL Time Warner, Sony, Universal, and others alleging violation of
federal antitrust law, and other claims, in connection with the provision of
video on demand (VOD) services over Internet protocol (IP). See also, Intertainer release.
Intertainer is a Culver City, California based company that has developed and
marketed VOD over IP services.
The complaint alleges that AOL Time Warner, Sony and Universal, and various of
their companies, have violated antitrust law. Intertainer summarizes the suit in
a release by stating that
the three content companies have "attempted to control the marketplace for
entertainment content on demand, thereby hindering and delaying the emergence of
the broadband content industry and Intertainer's video on demand services.
Intertainer maintains that the defendants have deliberately caused the delay so
that they may have the opportunity to deploy a service called Movielink, owned
in material part by the named defendants and other studios, that would
monopolize the Internet video on demand market."
The complaint alleges that the VOD services delivered by IP technology to
consumers is the relevant market for antitrust purposes. It further alleges that
Intertainer's streaming technology is of superior quality to the downloading
technology of the defendants. It further alleges that they "have attempted
to hinder and delay the emergence and expansion of IP video on demand services
provided by businesses independent of Defendants in order to protect and control
The complaint alleges violation of §1 of the Sherman Act (15 U.S.C. §1), and
violation of §7 of the Clayton Act (15 U.S.C. §18). The complaint prays for
damages, treble damages, an order requiring divestiture of MovieLink, and other
It also pleads, in shotgun fashion, many other causes of action: breach of
contract, breach of implied covenant of good faith and fair dealing, breach of
fiduciary duty, aiding and abetting and conspiring to breach fiduciary duties,
misappropriation of confidential information, intentional interference with
contractual relations, unfair competition, and unjust enrichment.
Technology Administration Releases Report on Broadband Demand
9/23. The Commerce Department's Technology
Administration released a report
[23 pages in PDF] titled "Understanding Broadband Demand: A Review of
Critical Issues". The report argues that widespread broadband deployment
will bring many social benefits, and that federal, state and local government
entities should work to promote broadband. This report focuses on "demand
The report is based on the premise that an analysis of government policy with
respect to promotion of broadband deployment is divisible into two sets of
issues -- supply side issues, and demand side issues.
The report states that "many nations, states, cities and communities are
trying to accelerate the deployment and usage of broadband networks. To date,
these efforts have predominantly focused on the supply side -- promoting
infrastructure build-out and determining appropriate competition and regulatory
policies." However, the report continues, "It is also important and
appropriate to consider the demand side -- factors impacting business and
The report notes that the Federal Communications
Commission (FCC) and National
Telecommunications and Information Administration (NTIA) are focused on
supply side issues, while the President's
Council of Advisers on Science & Technology (PCAST) and the Technology
Administration are focused on demand side issues.
The TA report continues that "There are several factors that impact the
robustness of demand. For consumers these include concerns over cost;
disappointment with the quality and types of content available, especially lack
of movies, music and local information; inadequate customer support and lack of
plug and play consumer premises equipment; and lack of confidence in the
Internet due to security and privacy concerns. For businesses, barriers to
greater broadband demand stem from price concerns (exacerbated by economic
uncertainty); lack of access to DSL or cable; failure to perceive the returns on
investment in broadband; lack of understanding about how to implement broadband
business solutions that make sense for company strategy; and concerns over
security and other legal uncertainties." (Parentheses in original.)
The report argues that "federal, state and local leaders can take steps to
accelerate broadband demand ... actions to accelerate demand are justified and
The report identifies four things that determine demand for broadband: cost,
content, convenience and confidence.
The report then lists and discusses several things government can do to impact
demand. The federal government should support business investment in broadband
equipment, support R&D new applications and technologies, create compelling
content and leading by example, protect intellectual property, oppose taxation
of new content and online services, promote efficient and broadband friendly
management of radio spectrum, and promote consumer confidence and cyber
security, ensure free flow of goods, services and ideas online.
With respect to intellectual property rights, the report states that
"governments can take several steps to strengthen the intellectual property
rights framework. By prosecuting clear violations of law, educating citizens and
students to respect IPR in the digital medium, protecting consumers’ interests
(such as fair use rights), and encouraging market players to cooperate and
coordinate, the federal government hopes to increase the pace with which movies
and music venture online." (Parentheses in original.)
The TA report also states that state and local government should consider
"bandwidth when addressing issues such as rights of way, taxes and
application fees, tower siting, zoning, building and construction codes,
building access, franchise agreements, historic preservation and environmental
GAO Releases Report on Internet Gambling Funding
9/23. The General Accounting Office (GAO)
released a report [22
pages in PDF] titled "Interim Report on Internet Gambling". It reviews
current law at the federal level, and in five states (Massachusetts, Nevada, New
Jersey, New York, and Utah). It also reviews the structure and operation of the
credit card industry, and how illegal gambling on the Internet could be affected
by prohibiting the use of credit cards in gambling. Finally, the report reviews
the vulnerability of Internet gambling to money laundering.
The report was prepared for Rep. Mike
Oxley (R-OH), Chairman of the House Financial Services
Committee (HFSC), Rep. John LaFalce
(D-NY), ranking Democrat on the HFSC, Rep.
Spencer Bachus (R-AL), Chairman of the Subcommittee on Financial
Institutions and Consumer Credit, and Rep.
Sue Kelly (R-NY), Chairman of the Subcommittee on Oversight and
Investigation. This Committee has jurisdiction over Internet gambling to the
extent that financial instruments are involved.
which is sponsored by Rep. Jim Leach
(R-IA), and HR 2579,
the Internet Gambling Payments Prohibition Act, which is sponsored by Rep. John LaFalce (D-NY), both attempt
to stop illegal gambling over the Internet by prohibiting the use of certain
financial instruments, including credit extended via a credit card, electronic
fund transfers, and checks.
The HFSC amended and approved HR 556 on October 31, 2001. See, story titled
"House Committee Passes Internet Gambling Funding Bill" in TLJ Daily E-Mail Alert
No. 299, November 1, 2001. The GAO report states that "In your letter
dated September 10, 2002, you noted plans to bring H.R.556, the Unlawful
Internet Gambling Funding Prohibition Act, to the House floor for debate later
The GAO labeled this report an "interim report". It added that it will
complete a "final report" in November 2002. This will be after the
107th Congress has completed its work, unless there is a lame duck special
session after the November elections.
Tech Bills Signed in California
9/23. California Gov. Gray Davis signed SB 772,
sponsored by Senator Debra Bowen (D-Marina del Rey), a bill pertaining to
termination of e-mail addresses. The bill provides that "Unless otherwise
permitted by law or contract, any provider of electronic mail service shall
provide each customer with notice at least 30 days before permanently
terminating the customer's electronic mail address." The bill further
provides that "No contract for electronic mail service may permit
termination of service without cause with less than a 30-day notice. For
purposes of this subdivision, ``termination of service without cause´´ means
termination of service at the unfettered discretion of the service provider
without regard to any conduct of the customer that violates the service
provider's terms of service or acceptable use policy." Finally, the bill
provides that "For purposes of this section, ``provider´´ shall mean the
entity that controls the customer's electronic mail address, and not the entity
making the underlying network or access available to the provider or the
9/23. California Gov. Gray Davis signed AB 885,
sponsored by Assemblymember Lynn Daucher (R-Brea). The bill allows high school
students taking approved Internet based courses to be counted toward a school's
average daily attendance. Gov. Davis wrote in a signing statement the bill
"establishes a distance learning pilot program for a limited number of
California public high schools. This pilot program is a pivotal first step in
exploring an important new mode of instruction. The potential benefits to
expanding internet based instruction are immense, including more one-on-one
communication between teachers and students, increases in technology training to
prepare students for the workforce, and improvements in the breadth and quality
of curriculum in urban, small, and remote schools."
9/23. The Federal Communications Commission
(FCC) released a Notice
of Apparent Liability for Forfeiture in a proceeding titled "In the
matter of One Call Communications, Inc. d/b/a Opticom", in which it
proposed to assess a forfeiture in the amount of $5,120,000 against Opticom for
widespread violations of the FCC's rules governing operator service providers (OSPs).
The FCC stated that these rules require OSPs "to identify itself audibly
and distinctly at the beginning of each call, before the consumer incurs any
charge; to permit the consumer to terminate the call at no charge before it is
connected; to provide its rates to consumers upon request; and to provide
instructions to the consumer on how to obtain the total cost of the call, which
must be available either by dialing no more than two digits or by remaining on
the line." The FCC further detailed 64 of Opticom's violation of these
rules. See also, FCC
9/23. The Federal Communications Commission
(FCC) released a second Notice of Apparent
Liability for Forfeiture in a proceeding titled "In the matter of ASC
Telecom, Inc. d/b/a Alternatel", in which it proposed to assess a
forfeiture of $1,440,000 for 16 violations of its OSP rules.
9/23. The Commerce Department's Bureau of
Industry and Security (formerly known as the Bureau of Export
Administration) published a notice
in the Federal Register containing its final rule amending the Export
Administration Regulations (EAR) to provide which "space qualified'' items
and telecommunications items for use on board satellites are controlled on the
Commerce Control List (CCL) and are therefore subject to the EAR. This rule also
removes the License Exception eligibility and amends the CCL for certain
"space qualified'' items. See, Federal Register, September 23, 2002, Vol.
67, No. 184, at Pages 59721 - 59733.
9/23. Securities and Exchange Commission (SEC)
Chairman Harvey Pitt
gave a speech to the
Council of Institutional Investors' Fall Conference in New York, New York. He
also gave a speech at
the September Symposium On Corporate Governance and Accounting Reform in
Washington DC on September 20.
9/23. The Department of Justice (DOJ) issued
in which it stated that the DOJ announced "three new guidelines designed to
institutionalize the ongoing sharing of information between federal law
enforcement and the U.S. intelligence community".
9/23. The U.S.
Court of Appeals (5thCir) issued its opinion
[22 pages in PDF] in IQ
Products v. Pennzoil, a Lanham Act case involving the advertising
of competing canned tire inflator products. The Appeals Court affirmed the grant
of summary judgment to defendants.
9/22. Qwest Communications announced in a release
that it will again restate its 2000 and 2001 financial statement, resulting in a
$950 Million change in revenues. It stated that the restatement pertains to
"revenue recognition and accounting treatment for exchanges and sales of
optical capacity assets (IRUs). In restating its 2000 and 2001 financial
statements with respect to these matters to be in conformance with generally
accepted accounting principles, the company will reverse $ 950 million in
revenues and related costs related to exchanges of optical capacity assets
Go to News from September 16-20, 2002.