TLJ News from October 21-25, 2006

CEA and Others Announce Digital Freedom Campaign

10/25. The Consumer Electronics Association (CEA), Public Knowledge (PK), Computer and Communications Industry Association (CCIA), and Media Access Project (MAP) held a news conference in Washington DC to announce the launch of a "Digital Freedom Campaign", or DFC.

The speakers were Gary Shapiro (CEA), Gigi Sohn (PK), Ed Black (CCIA), Harold Feld (MAP), and Don Goldberg (Corvis). Derek Slater of the Electronic Frontier Foundation (EFF) spoke via telephone.

Shapiro, Sohn and Black all reiterated points that they have made many times in the past. The MAP's participation is notable. It is an interest group that has previously advocated policy goals, and filed lawsuits, related to the regulation of broadcast media.

All of these groups, except the EFF, are based in the Washington DC area. The audience was comprised of Washington DC based technology and communications reporters, and representatives of Washington DC based interest groups, trade groups, and think tanks.

Nevertheless, the speakers conveyed their assertion that they are launching a broad based public campaign regarding the rights of consumers, creators and innovators to use copyrighted digital works.

The speakers announced and demonstrated a website. This web site features video of three young people complaining about content companies' efforts to restriction innovators, creators and consumers, who are then bound, gagged, and paper bagged.

In response to a question from the Hollywood Reporter, Goldberg stated that the three persons are hired actors.

DFC Bill of Rights. The speakers announced and released a short document titled "The Digital Freedom Bill of Sights and Sounds". TLJ asked Shapiro after the event what was said at this event that he has not said many times before. He said that the speakers announced the launch of a new campaign, and that they released its bill of rights.

The document contains an preamble, and then recites five rights, which are as follows:

DFC Agenda. Shapiro stated that "new technologies, and consumers' right to use these technologies, and their fair use rights are under attack by some very big companies and associations. You are all no doubt familiar with all the lawsuits, there have been some many of them, XM Radio, Sima, go back to Replay, and many others, and all of the Google".

He also cited "the various bills that the labels have tried to ram through Congress, to essentially ban noncommercial uses of content, such as simple recording off of the radio. And who among us has not seen that MPAA warning label, that is actually FBI, with the support of the United States government, before you watch any movie, which says that you cannot do anything that is not authorized with that movie. Well, we think it is time to change this. We think that it is time to fight back."

In the XM Satellite Radio case the plaintiff record companies assert that XM's services are not like traditional terrestrial broadcast radio. The complaint alleges that XM provides a "digital download subscription service that obliterates the careful limits Congress imposed in Section 114". This case is Atlantic Recording Corporation, et al. v. XM Satellite Radio, Inc., U.S. District Court for the Southern District of New York. See also, amicus brief [25 pages in PDF] of the CEA and other groups, and stories titled "Summary of the RIAA Lawsuit Against XM Satellite Radio", "Summary of the Sen. Feinstein's Perform Act", and "Music Licensing, Satellite Radio, and Perform Act Debated" in TLJ Daily E-Mail Alert No. 1,384, June 5, 2006.

The Sima case is Macrovision Corporation v. Sima Products Corporation, U.S. Court of Appeals for the Federal Circuit, App. Ct. No. 2006-1441, an appeal from the U.S. District Court for the Southern District of New York, D.C. No. 05-CV-5587, a case regarding the anti-circumvention provisions of the DMCA pending before the Court of Appeals. See, amicus brief [24 pages in PDF] of the CEA and other groups.

The Replay TV case was MGM, et al. v. ReplayTV, Inc., U.S. District Court for the Central District of California, D.C. No. 01-09801, a copyright infringement case involving claims of inducement of infringement.

There are many Google suits. There is a lawsuit pending in the District Court in which the plaintiff book publishers allege that the Google Print for Libraries project, which involves copying of books under copyright, violates copyright law. This case is McGraw Hill Companies, Inc., Pearson Education, Inc., Penguin Group (USA) Inc., Simon & Schuster, Inc. and John Wiley & Sons, Inc. v. Google Inc., U.S. District Court for the Southern District of New York, D.C. No. 05-CV-8881.

There is a separate by similar suit brought by the Authors Guild in the same court. See, story titled "Google, Publishers and Authors Debate Google's Print for Libraries Program" in TLJ Daily E-Mail Alert No. 1,239, October 25, 2005.

On the other hand, Shapiro may have been referring to the Google Image Search copying of copyrighted pictures of Perfect 10. This case is Perfect 10 v. Google, Inc., et al., U.S. District Court for the Central District of California, D.C. No. CV 04-9484 AHM (SHx). See also, story titled "District Court Rules in Perfect 10 v. Google" in TLJ Daily E-Mail Alert No. 1,319, February 28, 2006.

Google is not at this time a member of the Digital Freedom Coalition. TLJ spoke with Michael Petricone, SVP for Government Affairs at the CEA. He said that the DFC is about more than just movies and music. He said that it is about the "right to receive and use and access information".

The DFC also issued a release that criticizes several pending bills. These include HR 6052, the "Copyright Modernization Act of 2006", S 2644 and HR 5361, the "PERFORM Act", and HR 4861, the "Audio Broadcast Flag Licensing Act of 2006".

The DFC release states that HR 4861 "gives the FCC authority to impose technical conditions on both satellite and HD radio potentially prohibiting home networking and noncommercial recording".

It also states that the PERFORM Act "severely limits the ability of XM and Sirius subscribers to record programming for later listening, even though the recordings are locked to the radio and cannot be uploaded to the internet or burned to CD". See also, stories titled "Summary of the RIAA Lawsuit Against XM Satellite Radio", "Summary of the Sen. Feinstein's Perform Act", and "Music Licensing, Satellite Radio, and Perform Act Debated" in TLJ Daily E-Mail Alert No. 1,384, June 5, 2006.

HR 6052 is a large composite bill that includes, among other things, the "Section 115 Reform Act of 2006", or SIRA. See, story titled "House Judiciary Committee Puts Off Consideration of Copyright Legislation Until Next Year" in TLJ Daily E-Mail Alert No. 1,457, September 27, 2006, and stories titled "CIIP May Mark Up SIRA" in TLJ Daily E-Mail Alert No. 1,386, June 7, 2006, and "CIIP Subcommittee Approves Section 115 Reform Act" in TLJ Daily E-Mail Alert No. 1,388, June 9, 2006.

The release states that HR 6052 "requires licensing of all incidental network, cache and buffer copies, then denies the license to services that enable noncommercial recording".

HR 6052 also includes the latest House version of the orphan works bill. Gigi Sohn (PK) spoke favorably about this part of the bill at the DFC event.

Sohn, the second speaker at the event, stated that "big content companies have launched a sustained assault on the freedom of consumers to legally enjoy, create and distribute music and video, and on the freedom of manufacturers to innovate in response to consumer demands. These powerful companies have worked non-stop through the Congress, the Federal Communications Commission, and the Copyright Office, to achieve their aims."

She added that "we are frankly skeptical that combating theft is the true goals of these industries. We sometimes think that it is more about controlling devices than it is about stopping illegal activity."

She continued that "the new tools are the U.S. Supreme Court, and now the District Court's new decision, in MGM v. Grokster case, which gives them more power, lawsuits against infringers, and the passage of the Family Entertainment Copyright Act, in addition to the already strict penalties of the copyright law."

On June 27, 2005, the Supreme Court issued its unanimous opinion [55 pages in PDF] in MGM v. Grokster, reversing the judgment of the U.S. Court of Appeals (9thCir) regarding vicarious copyright infringement by the distributors of peer to peer (P2P) systems.

The Supreme Court held that "one who distributes a device with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement, is liable for the resulting acts of infringement by third parties."

Rent Seeking and IP Regimes. Sohn did not elaborate upon her assertion that the content companies' goal is "controlling devices". She did not offer an explanation of the economic incentive of content companies for "controlling devices".

There is an argument, which neither Sohn, nor any of the other speakers at this event advanced, that content companies, who hold copyrights on works of authorship, are seeking to develop and use copyright law and procedure in a manner that would enable them to capture some of the monopoly rents that device makers hope to obtain through their patented consumer devices.

For example, the argument goes, through threats of litigation under the DMCA, or for inducement of infringement, and agreements not to sue, content owners may be able to license device technologies, in a manner that bears attributes of patent licensing.

The related but opposing argument is that device and software makers seek to weaken copyright protection in order to decrease the monopoly rents on copyrighted works collected by the copyright holders, and thereby enable device makers to increase the revenues that they derive from sale of their devices.

Membership and Organization of the DFC. The speakers did not announce details about the organization, management or financing of the DFC. However, Shapiro stated that the CEA is providing initial financing.

The speakers announced, and distributed releases that list, the groups that are members of the DFC. These groups are the CEA, PK, CCIA, MAP, EFF, Be The Media, New America Foundation, National Video Resources, and

None of the big Washington DC groups with the word "consumer" in their title, such as the Consumers Union, Consumer Federation of America, is now a member of the DFC.

None of the major groups representing authors and individual creators is a member of the DFC. For example, neither the Authors Guild (AG), Recording Artists Coalition (RAC), Songwriters Guild of America (SGA), Professional Photographers of America (PPA), nor the Illustrators' Partnership of America (IPA) are members.

The speakers at the DFC event asserted that they represent the interests of creators and consumers. Audio and video content companies often make the same claim. Perhaps it is the case that neither the content companies, nor the CEA and its partners in the DFC, represent consumers or creators. However, both the content industries and the CEA are far more effectively organized and represented in Washington DC than are either consumers or creators.

Red Lion and Copyright. Harold Feld (MAP), the third speaker at the event, argued for a First Amendment free speech right of consumers in the context of digital media. He also praised the Supreme Court's opinion in Red Lion v. FCC, 395 U.S. 367 (1969), both during the event, and afterwards in conversation with TLJ.

He said during the event that "what we are seeing here is a flowering of the promise that was first spoken in the Supreme Court's Red Lion case, of the public's freedom and ability to speak and hear information from the diversity of sources in the electronic media. The technologies that are under assault today make that more than a promise. They make it a reality."

In 1964, Red Lion Broadcasting Company, which operated a radio station, broadcast a show titled "Christian Crusade", starring the Reverend Billy James Hargis, a once famous crusader against "godless communism". In one program, the Hargis referenced a book by Fred Cook. Cook took exception, and demanded that Red Lion broadcast his viewpoints. Red Lion refused. The FCC ordered Red Lion to put Cook on the air. Red Lion went to court, but lost. Ultimately, the Supreme Court affirmed the FCC's power to compel broadcasters to carry speech. It was called the "fairness doctrine".

The Supreme Court ruled that the free speech protections that apply to printers, pulpits, and pedestrians do not apply to broadcasters. It wrote that "differences in the characteristics of new media justify differences in the First Amendment standards applied to them." The Court rationalized its ruling by stating that "Because of the scarcity of radio frequencies, the Government is permitted to put restraints on licensees in favor of others whose views should be expressed on this unique medium." It added that "It is the right of the viewers and listeners, not the right of the broadcasters, which is paramount." And, it is the function of the FCC to determine what speech viewers and listeners have a right to hear.

This case, which is much criticized today, pertains to spectrum and broadcasting. It has not heretofore been central to the debates over digital copyrights.

However, the Supreme Court also transformed a right understood to protect one group (speakers) into a governmental power to limit the right of that group under the rubric of protecting another group (viewers and listeners). Perhaps Feld's and the Digital Freedom Campaign's argument is that there is an analogy between free speech rights of broadcasters and copyrights of content owners. That is, perhaps the DFC argues that both of their rights should be reconstrued as protections of the users of their products.

The argument may be that just as Red Lion concluded that the free speech clause can actually limit free speech of broadcasters, so Red Lion, by analogy should also limit the copyrights of content companies.

The Supreme Court's based its conclusion on the now much mocked rationale of spectrum scarcity. This spectrum argument is not relevant to the DFC's copyright issues. Feld did not advance a substitute rationale.

Gary Shapiro (CEA) did not mention Red Lion. Instead, he praised the Supreme Court's opinion in Sony Corp. of America v. Universal City Studios, Inc., 464 U.S. 417 (1984), which is also known as the Betamax case.

TLJ spoke with Michael Petricone, SVP for Government Affairs at the CEA. He said that he is not familiar with the Red Lion case, but that "the First Amendment includes a right to receive information", and this is an important argument of the DFC.

Reaction. Patrick Ross of the Progress and Freedom Foundation (PFF) wrote in a short paper titled "Recognizing the Vibrant Market for Digital Content" that "consumers win if they have access to a choice both of devices and content, and the best way to guarantee continued content choice is ensuring artists have the ability, in a free market, to negotiate use of their content".

He argued that "We clearly have a healthy, functioning licensing market for music". He continued that while the members of the DFC "are aware of the existing market for rights, they just don't wish to participate in it; they wish to create methods to bypass it. How can such an argument be justified? A common method seems to be to attempt to identify victims of the market. Overlooking the concerns of the original creators of content, it is argued that the secondary creators -- the ones down the value chain who have chosen to put themselves in the delicate position of creating works that depend on someone else’s original work -- are occasionally being denied the ability to perform their work if they can't reach an agreement on their terms. We are told culture is lessened as a result."

Ross concluded that "Artists are not threatened by copyright; they are empowered by it. Artists wishing to make derivative works are not collectively prevented from doing so; a vibrant market exists to facilitate that, and there is almost always substitutable content for those rare occasions where terms can't be reached. Policymakers must recognize that regardless of the self-interest of any given party in the copyright debate, we want artists to maintain their copyrights in the digital age. If artists' rights are preserved, there will be a continuing stream of new content we can legally enjoy in new and unprecedented ways."

Also, a collection of music industry groups released a statement addressed "Dear CEA" on October 25. It is signed by the Recording Industry Association of America (RIAA), National Music Publishers Association (NMPA), The Harry Fox Agency, Recording Artists Coalition, Songwriters Guild of America, and other groups.

It states that "demagoguery does not advance the conversation or inform the public. Nor does a cavalier dismissal of the rights of the people who create music and bring it to the public."

They wrote that "Our position is basic: artists, songwriters, music publishers, musicians and record labels deserve to be paid when our music is downloaded and enjoyed by fans."

"This debate needs to be elevated and high-minded", that asserted. "We offered a truce and dialogue a month ago, and your response, unfortunately, has been to ratchet up the rhetoric."

Caroline Joiner, Executive Director of the U.S. Chamber of Commerce's intellectual property (IP) initiative, wrote in a release that "The coalition led by the Consumers Electronics Association is pursuing a self-defeating strategy. Demolishing the rights of creative artists will hurt consumers and technology providers, not help them. Musicians, artists, filmmakers, and others won't produce rich, diverse content if they don't believe their creations will be adequately protected from IP theft and other unfair, illegal uses. Without content, the market for technology designed to deliver it will dry up quickly."

She added that "The U.S. Chamber -- whose membership includes both content creators and technology providers -- is pursuing a policy that strikes the right balance between the need for the protection of IP and the fair, legal use of content. The Chamber is committed to protecting the technological and creative innovations that drive our economic growth and ensuring that these innovations are protected here and around the globe. We are committed to fight any effort that diminishes the rights granted to artists and innovators under U.S. copyright law. At the same time, we support the fair use of content by individuals as long as it is reasonable, equitable, and legal."

SGI Sues ATI for Patent Infringement in Western District of Wisconsin

10/25. Silicon Graphics Inc. (SGI) filed a complaint in U.S. District Court (WDWisc) against ATI Technologies alleging patent infringement. The complaint, filed on October 24, alleges infringement of U.S. Patent No. 6,650,327 which relates to graphics processing.

On October 25, 2006, Advanced Micro Devices (AMD) announced that it completed its acquisition of ATI Technologies. See, AMD release.

SGI is the assignee of U.S. Patent No. 6,650,327, titled "Display system having floating point rasterization and floating point framebuffering".

Dennis McKenna, CEO of SGI, stated in a release that "The Company's technology covered by the '327 patent is an important resource in achieving enhanced graphics processing demanded by today's computer systems ... SGI has licensed this technology to ATI's major competitors and, as I have previously been stating publicly, SGI intends to aggressively protect and enforce its IP. This is the first visible step in that process."

An AMD spokesman told TLJ that AMD is still reviewing the complaint, but will "aggressively defend" itself. He added that AMD does not expect the suit to create any issues for the merger, or with its plans going forward.

SGI is a Delaware corporation based in Mountain View, California. Neither ATI nor AMD incorporated in, or established a major presence in, Wisconsin.

Bush Discusses Electronic Surveillance

10/25. President Bush gave a speech at a Congressional campaign event in Sarasota, Florida on October 24. He discussed the extra-judicial electronic surveillance program of the National Security Agency (NSA) where one party in inside the U.S. and one party is outside the U.S.

He said that "We had a series of interesting votes in Washington, D.C. recently that should explain the fundamental differences between how we view the war on terror and how the Democrats view the war on terror. I felt that the President should do everything in his power within the Constitution to protect you. And therefore, after 9/11, I made a couple of decisions that recently were brought to a vote on the floor of the House of Representatives, which should give you an indication about the differences of opinion."

President Bush did not reference any bill numbers or titles. However, the House approved HR 5825, the "Electronic Surveillance Modernization Act", sponsored by Rep. Heather Wilson (R-NM), on September 28, 2006. The House vote was 232-191. Republicans voted 214-13, while Democrats voted 18-177. See, Roll Call No. 502. See also, story titled "Bush Discusses Surveillance, FISA and HR 5825" in TLJ Daily E-Mail Alert No. 1,461, October 4, 2006.

He continued that "I believe that we must work to prevent attacks from happening in the first place, but here in the homeland -- by staying on the offense. But here in the homeland, I understand that the enemy has to be right one time, and we have to be right a hundred percent of the time in order to protect you. And therefore I feel it's important to make sure our professionals have the tools necessary to protect you."

"I felt like that if al Qaeda or an al Qaeda affiliate was making a phone call into the United States of America from outside our country, our intelligence professionals need to know why. This is a different kind of war. Past wars -- in past wars, you could watch flotillas of ships or count airplanes to determine the intent or the strength of the enemy; you could watch manpower being moved. This is a different kind of war. It's a war that requires intelligence so that we can make sure our professionals are able to protect you", said Bush.

He added that "The idea of people -- professionals being able to listen to al Qaeda and its affiliates came to a vote on the floor of the United States Congress. The American people must fully understand that the vast majority of Democrats opposed the right of this administration to have a tool necessary to protect you. We just have a different view. They must not think we're at war. They must think that the best way to protect you is to respond after the attack."

President also held a long news conference in Washington DC on October 25 at which he discussed the war on terrorism, Iraq, Iran and North Korea. See, transcript.

He stated that terrorists "are lethal, cold-blooded killers. And we must do everything we can to protect the American people, including questioning detainees, or listening to their phone calls from outside the country to inside the country. And there was -- as you know, there was some recent votes on that issue. And the Democrats voted against giving our professionals the skill -- the tools necessary to protect the American people."

More News

10/25. The U.S. Court of Appeals (10thCir) issued its opinion [48 pages in PDF] in Allen v. Sybase, a case involving application of the Worker Adjustment and Retraining Notification (WARN) Act to layoffs by a software company. The WARN Act, which is codified at 29 U.S.C. §§ 2101-2109, requires certain employers to provide notice 60 calendar days in advance of plant closings and mass layoffs. This case is Julie Allen, et al. v. Sybase, Inc.and Financial Fusion, Inc., U.S. Court of Appeals for the 10th Circuit, App. Ct. No. 04-4045, an appeal from the U.S. District Court for the District of Utah, D.C. No. 2:03-CV-149-TC.

10/25. The U.S. Court of Appeals (4thCir) issued its opinion [PDF] in MCI v. Paetec Communications, a telecommunications access charges dispute, affirming the District Court's summary judgment for MCI. This is an "unpublished per curiam opinion". This case is MCI WorldCom Network Services, Inc. v. Paetec Communications, Inc., U.S. Court of Appeals for the 4th Circuit, App. Ct. No. 06-1013, an appeal from the U.S. District Court for the Eastern District of Virginia, at Alexandria, Judge Claude Hilton presiding, D.C. No. CA-04-1479-CMH-BRP.

FTC to Seek Information About Internet Advertising of Alcohol

10/24. The Federal Trade Commission (FTC) published a notice in the Federal Register announcing, and requesting public comment on, its proposal to issue orders to alcoholic beverage advertisers to produce information.

In addition to seeking information about advertising in old media, the FTC also proposes to seek information about expenditures for company web sites, sponsored web sites, web advertising, e-mail, text messaging, instant messaging, and "other digital advertising".

The notice states that the FTC proposes to issue "compulsory process orders to beverage alcohol advertisers for information concerning, inter alia, compliance with voluntary advertising placement provisions, sales and marketing expenditures, and the status of third-party review of complaints regarding compliance with voluntary advertising codes".

There is no industry specific statute involved. Rather, the U.S. alcoholic beverage industry engages in voluntary self regulation of advertising practices.

The deadline to submit public comments is November 24, 2006. See, notice in the Federal Register, October 24, 2006, Vol. 71, No. 205, at Pages 62261-62266. See also, FTC release.

More News

10/24. The U.S. Court of Appeals (9thCir) issued a short order [PDF] on remand in Dagher v. Texaco. It wrote simply that "Pursuant to the Supreme Court judgment, we affirm the district court’s grant of summary judgment to the defendants." On February 28, 2006, the Supreme Court issued its unanimous opinion [9 pages in PDF] reversing the judgment of the Court of Appeals. The Supreme Court held that it is not per se illegal under Section 1 of the Sherman Act for a lawful, economically integrated joint venture to set the prices at which the joint venture sells its products. See, story titled "Supreme Court Reverses in Texaco v. Dagher" in TLJ Daily E-Mail Alert No. 1,320, March 1, 2006.

10/24. The Securities and Exchange Commission (SEC) announced that it settled civil fraud charges against David Kreinberg, former Chief Financial Officer of Comverse Technology. The SEC that the settlement agreement "provides for the payment of nearly $2.4 million in disgorgement and prejudgment interest, a permanent injunction, a permanent officer-and-director bar, and suspension from appearing or practicing before the Commission as an accountant." See, SEC release and release. Kreinberg is one of three defendants in SEC v. Jacob Alexander, et al., a case in which the SEC alleged various violations of federal securities law in connection with the backdating of stock options. This case is pending in the U.S. District Court for the Eastern District of New York. It is D.C. No. CV-063844 (GJ).

10/24. The Progress and Freedom Foundation (PFF) released a short paper [6 pages in PDF] titled "The Patent Prejudice: Intellectual Property As Monopoly". The author is the PFF's Solveig Singleton. While the "assessment of IP as monopoly is now particularly predominant in international policy circles", writes Singleton, "Neither patents nor copyrights can be fairly thought of as creating economic monopoly in a way that injures consumers." She concludes that "rhetoric about monopolies is nothing but a distraction."

IBM Sues Amazon for Patent Infringement in Eastern District of Texas

10/23. IBM filed two complaints in U.S. District Court (EDTex) against Amazon alleging patent infringement.

John Kelly, an IBM SVP, stated in a release that "IBM's property is being knowingly and unfairly exploited ... IBM is one of the world's leading creators of intellectual property and one of the most progressive in embracing new, highly collaborative ways of driving and managing innovation. Everything we do is premised on the fundamental principle that IBM's intellectual property is one of our core assets, and represents the work product of tens of thousands of scientists and engineers and billions of dollars of investment."

The patents in suit are U.S. Patent No. 5,796,967, titled "Method for presenting applications in an interactive service", U.S. Patent No. 5,442,771, titled "Method for storing data in an interactive network", U.S. Patent No. 7,072,849, titled "Method for presenting advertising in an interactive service", U.S. Patent No. 5,446,891, titled "System for adjusting hypertext links with weighted user goals and activities", and U.S. Patent No. 5,319,542, titled "System for ordering items using an electronic catalogue".

IBM is a New York corporation based in Armonk, New York. Amazon is a Delaware corporation based in Seattle, Washington.

The connection of these companies and these lawsuits to the Eastern District of Texas is insignificant. However, the Eastern District of Texas is a court of choice for forum shopping plaintiffs in patent cases.

There are legislative proposals that would limit abuse of federal venue rules that enable forum shopping in patent cases. See for example, Section 7 of HR 5096, the "Patents Depend on Quality Act of 2006", or "PDQ Act", introduced by Rep. Howard Berman (D-CA) and Rep. Rick Boucher (D-VA) on April 5, 2006, and Section 8 of S 3818, the "Patent Reform Act of 2006 ", introduced by Sen. Orrin Hatch (R-UT) and Sen. Patrick Leahy (D-VT) on August 3, 2006.

A spokesman for Amazon stated in an e-mail message to TLJ that "We have a general policy of not commenting on active litigation outside of our court filings".

Federal Circuit Rules in Safeclick v. Visa

10/23. The U.S. Court of Appeals (FedCir) issued its opinion [PDF] in Safeclick v. Visa, a patent infringement case relating to security for online credit card transactions. The Court of Appeals affirmed the District Court's summary judgment of non-infringement.

Safeclick owns U.S. Patent No. 5,793,028, titled "Electronic transaction security system". It filed a complaint in U.S. District Court (NDCal) against Visa alleging that Visa's "Verified by Visa" service infringes several claims of the patent in suit. The District Court granted summary judgment of non-infringement to Visa. Safeclick brought this appeal. The Court of Appeals affirmed.

The Northern District of California has local patent rules, which the District Court concluded Safeclick had violated. Hence, the Court of Appeals opinion also addresses appellate review of District Court rulings based upon local rules.

This opinion states that it "is not citable as precedent".

This case is Safeclick LLC v. Visa International Service Association and Visa USA, Inc., App. Ct. No. 06-1182, an appeal from the U.S. District Court for the Northern District of California. Judge Clevenger wrote the opinion of the Court of Appeals, in which Judges Bryson and Gajarsa joined.

Fourth Round of Korea US FTA Negotiations Commence

10/23. Wendy Cutler, Assistant U.S. Trade Representative for Japan and Korea, held a news conference in Jeju, Korea, regarding the commencement of the fourth round of the Korea United Stated free trade agreement (KORUS FTA) negotiations. See, transcript [5 pages in PDF].

Cutler said that "We have sixteen negotiating groups and two working groups meeting here this week. And again, both sides have brought large and dedicated negotiating teams to the table. The U.S. delegation is comprised of about 100 delegates from nearly 20 different government agencies. We have come to Jeju well prepared and ready to make progress."

She said little about technology related trade issues. However, she said that "The progress we seek this week is not just limited to tariffs. It also involves movement on a series of non-tariff measures as well".

She added that "we're also looking for progress in the areas that have to do with rules and text and dealing with non-tariff measures, and for the United States, our priorities lie in many chapters, including automotive, pharmaceuticals, intellectual property protection, investment and other areas."

In addition, Karan Bhatia, a Deputy USTR, gave a speech [7 pages in PDF] at Yonsei University in Seoul, Korea. He said that "the KORUS FTA can be one of the pillars upon which a new 21st Century U.S.-Korea partnership is founded -- a partnership that benefits both of our countries economically, that binds the United States firmly to North Asia, and that serves as a model of open markets to countries on both sides of the Pacific."

He also noted that "Korea has also taken steps to ensure that its intellectual property laws keep pace with the global changes in this area."

Go to News from October 16-20, 2006.