TLJ News from June 11-15, 2007.

TLJ News from June 11-15, 2007

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6/15. The Copyright Office (CO) published a notice in the Federal Register that contains a list of stations listed in affidavits sent to the CO in which the owner or licensee of the station attests that the station qualifies as a specialty station. This pertains to the cable compulsory license codified at 17 U.S.C. S 111. A cable operator may carry the signal of a television station classified as a specialty station at the base rate rather than at the higher 3.75% rate that is incurred for the carriage of a non-permitted signal. The deadline to submit comments to the CO is July 16, 2007. See, Federal Register, June 15, 2007, Vol. 72, No. 115, at Pages 33251-33252.

Administration Officials Promote KORUS FTA

6/14. Susan Schwab, the U.S. Trade Representative (USTR), gave a speech [PDF] in which she promoted the Korea U.S. free trade agreement (KORUS FTA), which has been negotiated, and released, by trade negotiators, but not ratified by the national legislatures.

She said that "When the history of the early 21st century is written, I hope the KORUS FTA will be listed among its great achievements. It should stand as an example of American and Korean leadership in trade and as a key event in America’s engagement in one of the most economically vibrant regions in the world. It should be remembered as a bipartisan achievement in the effort to offer a better life to the people of the United States and Korea."

Trade promotion authority expires at the end of this month. However, Schwab said that "The Office of the U.S. Trade Representative remains the same beehive of activity it has always been."

She also addressed the administration's "bipartisan agreement with the Congress". She said that "We have been working intensely over the past four weeks to turn that agreement into formal text.

She discussed the Doha round negotiations. She said that "The sense of urgency is there", and that "We will keep forging ahead in the hopes of finding a way".

Also, on June 13, 2007, the House Foreign Affairs Committee's Subcommittee on Terrorism, Nonproliferation, and Trade held a hearing titled "The United States-South Korea FTA: The Foreign Policy".

Karan Bhatia (at right), a Deputy U.S. Trade Representative, wrote in his prepared testimony [PDF] about the economic benefits of this FTA. He wrote that "In the area of intellectual property rights, the Agreement provides significantly enhanced standards for protection and enforcement of a broad range of intellectual property rights, including trademark-, copyright-, and patent-related provisions and will provide effective -protection and enforcement for emerging technologies."

He continued that "In the area of telecommunications services, U.S. suppliers will benefit from South Korea’s agreement to permit U.S.-controlled companies to own 100 percent of South Korean telecommunications operators within two years." He added that electronic commerce will also benefit.

Christopher Hill, an Assistant Secretary of State, wrote in his prepared testimony about the foreign policy benefits of this FTA.

Rep. Brad Sherman (D-CA), the Chairman of the Subcommittee, criticized the KORUS FTA in his opening statement. He said that before approval, "we should be certain that we are not setting into motion a plan that will once again lead to the demise of Detroit".

He also argued that "There is a Trojan Horse in this deal", referring to "outward processing zones in North Korea". He wants the agreement to be amended to provide that "No good or service produced in whole, or in part, in the portion of the Korean Peninsula located north of the Korean War Armistice Line shall be eligible for the benefit of this agreement ...".

Rep. Ed Royce (R-CA), the ranking Republican on the Subcommittee, responded in his opening statement that goods from the one applicable site, the Kaesong Industrial Complex, "were excluded from this agreement's tariff benefits". However, he noted that "South Korea hasn't lived-up to previous agreements to end its discriminatory treatment of American-made cars, which has choked off U.S. sales in South Korea."

See also, story titled "US and Korea Announce FTA" in TLJ Daily E-Mail Alert No. 1,559, April 2, 2007. And see, text of the agreement, and particularly, sections regarding telecommunications [17 pages in PDF], electronic commerce [4 pages in PDF], intellectual property rights [35 pages in PDF].

DC Superior Court Dismisses Lost Laptop Data Case for Lack of Standing

6/13. The Superior Court for the District of Columbia, Civil Division, issued an order [PDF] in Randolph v. ING, dismissing the plaintiffs' privacy related complaint for lack of jurisdiction. This is an action against an insurance company following the theft of a laptop computer from the home of an employee of the company that contained personal information regarding the plaintiffs.

The Court held that since the complaint alleged data loss, and exposure to a heightened risk of identity theft, but not actual injury, the plaintiffs lack standing to sue.

Previously, the U.S. District Court (DC) held that it lacks jurisdiction over these claims for lack of Article III standing. See, February 20, 2007, Memorandum Opinion and Order [17 pages in PDF], and story titled "District Court Holds that Injury in Fact is a Prerequisite for Standing in Lost Data Case" in TLJ Daily E-Mail Alert No. 1,544, February 27, 2007.

The just released order of the DC Superior Court states that the February order of the US District Court is a "thorough and well-reasoned opinion", but is not the law of the case, and not binding on the Superior Court.

The U.S. District Court for the District of Columbia is a trial court of the federal judicial system. It was created under Article III of the U.S. Constitution. The Superior Court for the District of Columbia is a trial court of the District of Columbia's judicial system. It was created pursuant to Article I of the Constitution. It is not a state court.

ING Life Insurance and Annuity Company provides a deferred compensation plan and other services to employees of the District of Columbia, including Regina Randolph and the other plaintiffs in this action. A burglar stole a laptop computer from the home of an ING employee. Plaintiffs allege that it contained personal and financial information. However, they do not allege that they are victims of identity theft or fraud resulting from the theft of the laptop.

Rather, they allege that the laptop theft has exposed them to a heightened risk of identity theft and that ING's negligence or gross negligence in allowing this information to be stored on an employee's computer and removed from otherwise secure facilities invaded their privacy and proximately caused them damages.

The plaintiffs filed a complaint in Superior Court for the District of Columbia against ING alleging two counts of invasion of privacy, one count of negligence, and one count of gross negligence. The plaintiffs amended their complaint to add claims of breach of fiduciary duty or confidential relationship and statutory causes of action.

ING moved to dismiss the complaint on several grounds. The Superior Court granted the motion, and dismissed for lack of jurisdiction.

The Court wrote that "To have standing, the Plaintiff ``must have suffered an injury in fact -- an invasion of a legally protected interest which is (a) concrete and particularized, …and (b) actual or imminent, not conjectural or hypothetical.ดด" (This quotes from Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992) and other opinions.)

The Court wrote that the plaintiffs have only alleged "that they are more vulnerable to identity theft now that their personal data has fallen into the hands of the thief of the computer or one who receives it from the thief, and the Plaintiffs who are police officers allege that their home addresses may be compromised, subjecting them to possible threats or violence. No Plaintiff alleges that his or her identity has in fact been stolen or used, and no police officer Plaintiff alleges that his or her residence has been revealed or threatened in any way." (Footnote omitted.)

The Court added that the plaintiffs are "worried", and might incur expenses "to protect their credit or to repair any damage if it occurs", but that all this is "insufficient to confer standing".

The Court also noted that it is possible "that the thief kept the computer or passed it to someone who erased its hard drive and memory to make it more pristine for resale".

The Court also cited other cases in which federal courts held that the plaintiffs lacked the requisite injury to establish standing to sue or to state a legally sufficient claim for relief. It added that it is aware of no cases to the contrary. All of the cited opinions are from federal courts.

The federal court opinions on standing apply Article III, Section 2, of the Constitution, which provides that "The judicial Power shall extend to all Cases ... Controversies ..."

The Superior Court is not an Article III court. Nevertheless, the Court wrote that "our local Article I courts will accept jurisdiction only over actual cases and controversies and insist on the same prudential prerequisites of standing as the Article III courts."

The Superior Court did not reach the question of whether the complaint should also be dismissed for failure to state a claim upon which relief can be granted, for failure to allege injury in fact.

This case is Regina Randolph et al. v. ING Life Insurance and Annuity Company, Superior Court for the District of Columbia, Civil Division, Civil Action No. 06 CA 4932, Judge Frederick Weisberg presiding.

ING is represented by Alan Charles Raul, Juan Morillo, and Stephen Nickelsburg of the Washington DC office of the law firm of Sidley Austin.

11th Circuit Rules in Collective Work Copyright Case

6/13. The U.S. Court of Appeals (11thCir) issued its opinion [19 pages in PDF] in Greenberg v. National Geographic Society, a copyright case.

Initially, copyright vests in the author of a work, or the photographer who takes a picture. However, the writer or photographer may work under a contract with an employer or other person or entity that provides that articles or pictures are works made for hire, in which case the employer holds the copyright. Alternatively, an independent or freelance writer or photographer may license works to the publisher of a collective work, such as a daily newspaper or periodical magazine. This case concerns this later scenario.

More specifically, this case, and other similar cases, address copyright in works that have been licensed to a publisher of a collective work when that publisher decides to later include the copyrighted article or photograph in subsequent collective works, such as electronic databases, or CD versions of print publications.

The Supreme Court held in New York Times v. Tasini that freelanced articles in newspapers, for which the author still owns the copyright, cannot be republished in electronic databases without permission from the author.

The present case involves National Geographic's (NG) replication of past issues of its print magazine in a CD collection. NG used articles of freelance writers and photographers, including Jerry Greenberg. The Second Circuit held in Faulkner v. National Geographic Society, and the 11th Circuit held in the present case, that this is permissible, under Section 201(c) of the Copyright Act, without further license from the freelance authors and photographers. Moreover, both Courts held that adding additional material to the CD collection that contains the replications does not negate the Section 201(c) privilege for reproducing the freelance works. However, the 11th Circuit held that while there is no infringement of a copyrighted freelance work that is included in the replication, there may be infringement if it is in the addition material that accompanies the replication.

Relevant Statute. The relevant statute is codified at 17 U.S.C. ง 201(c). It provides in full that "Copyright in each separate contribution to a collective work is distinct from copyright in the collective work as a whole, and vests initially in the author of the contribution. In the absence of an express transfer of the copyright or of any rights under it, the owner of copyright in the collective work is presumed to have acquired only the privilege of reproducing and distributing the contribution as part of that particular collective work, any revision of that collective work, and any later collective work in the same series."

Related Cases. This is another in a series of related cases regarding collective works and new electronic media. The just released opinion will likely be referred to as Greenberg II. In 2001 the 11th Circuit issued its Greenberg I opinion, Greenberg v. National Geographic Society, 244 F.3d 1267. There is also the Supreme Court's June 25, 2001 opinion in New York Times v. Tasini, which is reported at 533 U.S. 483, and the U.S. Court of Appeals (2ndCir)'s 2005 opinion in Faulkner v. National Geographic Enterprises, which is reported at 409 F.3d 26.

In Tasini, the Supreme Court addressed the republication of the articles of freelance writers in electronic databases, which articles were originally published in periodicals, such as the New York Times. The plaintiffs were freelance authors whose articles were previously published in these periodicals. The defendants were publishers and owners of electronic databases that republished their articles. None of the plaintiffs were employed by the periodical publications in which their articles appeared. Nor did they have work for hire contracts. All registered a copyright in each of the articles at issue. The authors' ownership of the copyright in their individual works was not in dispute. Subsequently, the periodical publications licensed much of the content of their periodicals, including the plaintiffs' works, to one or more of the electronic database providers.

The Supreme Court held that the defendant publishers did not have a privilege under Section 201(c) of the Copyright Act to include in electronic databases the freelance articles written for and licensed to print publications.

See also, story titled "Supreme Court Rules for Authors in NYT v. Tasini" in TLJ Daily E-Mail Alert No. 216, June 26, 2001. And see, story titled "Supreme Court Grants Cert in NYT v. Tasini", Tech Law Journal, November 7, 2000.

Faulkner was decided after Tasini. The plaintiffs in that case also sued the NGS for copyright infringement following republication of their work in the CNG. There is, however, a distinguishing fact in Greenberg's case. While his photographs were used in the CNG's replication of the print issues, one was also included in a new photographic sequence contained in the CNG.

Greenburg I was decided before Tasini and Faulkner.

Facts Related to Greenberg. The plaintiffs below in the present case are Jerry Greenberg, an independent photographer, and his wife. The defendants are the National Geographic Society, National Geographic Enterprises, Inc., and Mindscape, Inc., a software company.

Greenberg's photographs were published in the January 1962, February 1968, May 1971 and July 1990 issues of National Geographic magazine.

In 1997, National Geographic produced a 30 disc CDROM product titled "The Complete National Geographic" or CNG. It reproduced each monthly issue of the print magazine from 1888 through 1996, including Greenberg's pictures, in which he holds the copyright. NG did not obtain permission from Greenberg to include his pictures in CNG.

The Court of Appeals wrote that there are three relevant components of the CNG. First, there is the replica of the print issues. Second, there is a program created by Mindscape that compresses and decompresses the images and allows users to search an electronic index. Third, there is a sequence that includes a 25 second segment in which ten images of actual magazine covers from past issues, including Greenberg's January 1962 cover photograph, digitally fade into one another.

District Court. Greenberg and his wife filed a complaint in U.S. District Court (SDFl) against NGS, NGE, and Mindscape alleging copyright infringement.

The NG defendants filed a motion to dismiss on the ground that NG had a privilege to publish a revision of the originally licensed works under 17 U.S.C. ง 201(c). The District Court granted the motion. The Court of Appeals reversed in Greenberg I. (The Supreme Court issued its opinion in Tasani three months later.)

The Court of Appeals reasoned in Greenberg I that the subsequent work, the CNG, added independently copyrightable elements not present in the original collective work, and hence cannot be privileged by Section 201(c).

On remand, the District Court granted Greenberg judgment of infringement. The trial jury then returned a verdict finding willfulness, and awarded maximum statutory damages for willful copyright infringement.

Court of Appeals. The NG parties brought the present appeal. The Court of Appeals held the Tasini opinion created a new framework that overrules Greenberg I. Hence, the Court of Appeals is now no longer bound under collateral estoppel by its earlier decision.

Then, applying Tasini, the Court of Appeals held that both the replica and program are privileged under Section 201(c). The Court of Appeals also vacated the verdict of willful infringement and the damage award. The case now goes back to the District Court. Greenberg can proceed against the NG defendants only on the one photograph included in the sequence.

The Court of Appeals distinguished the facts of Tasini from those in the present case. In Tasini, the authors contributed articles to the print editions of periodicals, and these articles were later included in electronic databases. In contrast, in the present case, Greenberg contributed photographs to the print editions of the National Geographic magazine, and NG now replicates those issues on CD.

The Court of Appeals wrote that "The Supreme Court distinguished the electronic databases at issue in Tasini from microfilm and microfiche, which present an individual freelance contribution in the context of the original collective work, and implied, without directly stating, that such collections are privileged under ง 201(c)."

The Court of Appeals continued that "Under the Tasini framework, the relevant question is whether the original context of the collective work has been preserved in the revision. Clearly, the Replica portion of the CNG preserves the original context of the magazines, because it comprises the exact images of each page of the original magazines. Similarly, the Program is transparent to the viewer and does not alter the original context of the magazine contents."

The Court added that the "Sequence does not extinguish the privilege that attaches to the Replica." The Court noted that the sequence is a "brief visual introduction" and analogized it to the cover of a book.

However, Court also held that the CNG's sequence presents one of Greenberg's pictures out of the context in which the original photographs were presented, and hence, is not privileged under Section 201(c).

The Court of Appeals remanded the case to the District Court the question of whether NG is liable for infringement for its sequence, and if so, whether that infringement was willful. The Court of Appeals also reinstated other defenses raised by NG that were not previously decided on their merits.

This case is Jerry Greenberg v. National Geographic Society, et al., U.S. Court of Appeals for the 11th Circuit, App. Ct. No. 05-16964, an appeal from the U.S. District Court for the Southern District of Florida, D.C. No. 97-03924-CV-AMS. Judge David Trager (USDC/EDNY sitting by designation), wrote the opinion of the Court of Appeals, in which Judges Barkett and Kravitch joined.

Before this opinion, the 11th Circuit's opinion in Greenberg I was arguably in conflict with the 2nd Circuit's opinion in Faulkner. Then, a judge from the 2nd Circuit, sitting by designation in the 11th Circuit, wrote an opinion for the 11th Circuit that adopted the 2nd Circuit's position, and overturned the 11th Circuit's precedent.

6th Circuit Addresses Damages in Software Copyright Infringement Case

6/13. The U.S. Court of Appeals (6thCir) issued is opinion [9 pages in PDF] in Thoroughbred Software v. Dice, a software copyright case involving the award of actual damages, profits resulting from infringement, and attorneys fees.

The Court of Appeals held, among other things, that when a software copyright holder licenses software for a license fee for each copy, and the licensee makes more copies than it licenses, the copyright holder is entitled to recover as actual damages the amount of unpaid licensing fees. Moreover, this applies to unlicensed copies that are made, but not actually used.

Thoroughbred Software International, Inc. develops and sells business accounting software. Dice, Inc. provides computer hardware with pre-installed software to its business customers in the security and alarm monitoring industry. Dice licensed software from Thoroughbred. The agreement provided that a license fee is due for each copy of software purchased, and that Dice cannot make additional copies.

However, Dice also installed extra unlicensed copies of Thoroughbred software, and a disgruntled former Dice employee notified Thoroughbred.

District Court. Thoroughbred filed a complaint in U.S. District Court (EDMich) against Dice and two of its principals alleging copyright infringement. The District Court found that Dice exceeded the scope of its license and violated the Copyright Act.

The District Court also found that some of the unauthorized copies were used by Dice's customers, but some were not. The District Court awarded actual damages (the unpaid licensing fees) for the software that was used, and denied actual damages for the unused software. The District Court also declined to award Thoroughbred recovery for profits that Dice made from infringement. It also declined to award attorney's fees to either party on the ground that no party constituted a prevailing party under Section 505.

Relevant Statutes. 17 U.S.C. ง 504(b) provides in full that "The copyright owner is entitled to recover the actual damages suffered by him or her as a result of the infringement, and any profits of the infringer that are attributable to the infringement and are not taken into account in computing the actual damages. In establishing the infringer’s profits, the copyright owner is required to present proof only of the infringer’s gross revenue, and the infringer is required to prove his or her deductible expenses and the elements of profit attributable to factors other than the copyrighted work."

17 U.S.C. ง 505 provides in full that "In any civil action under this title, the court in its discretion may allow the recovery of full costs by or against any party other than the United States or an officer thereof. Except as otherwise provided by this title, the court may also award a reasonable attorney’s fee to the prevailing party as part of the costs."

Court of Appeals. Thoroughbred brought the present appeal. Dice did not cross appeal the judgment of infringement, or the award of actual damages as to the software that was used. Hence, the only issues on appeal pertain to the other remedies for infringement.

The Court of Appeals wrote that the proper measure of actual damages in this case is the amount Thoroughbred would have received but for Dice’s unlawful copying of the software. IT also held that Dice is liable for the unpaid license fees for all of the unauthorized copies, regardless of whether or not they were ultimately used by Dice's customers. Hence, it reversed the District Court on this issue.

The Court of Appeals affirmed the District Court's denial of profits. However, it based its affirmance upon Thoroughbred's failure to offer the appropriate evidence of profits at trial.

The Court of Appeals wrote that "In the instant case, the proper measure of the infringer’s profits is the amount that Dice Corp. charges its customers for the infringing software, minus the amount that Dice Corp. should have paid Thoroughbred for the infringing software (i.e., the lost license fee), which has already been included as actual damages." (Parentheses in original.)

Finally, the Court of Appeals held that Thoroughbred is the prevailing party. Hence, it vacated the District Court's denial of attorney's fees, and remanded for a determination of whether Thoroughbred, as the prevailing party, is entitled to an award for attorney's fees.

This case is Thoroughbred Software International, Inc. v. Dice Corporation, et al., U.S. Court of Appeals for the 6th Circuit, App. Ct. No. 06-2080, an appeal from the U.S. District Court for the Eastern District of Michigan at Bay City, D.C. No. 03-10259, Judge David Lawson presiding. Judge Solomon Oliver (USDC/NDOhio sitting by designation) wrote the opinion of the Court of Appeals, in which Judges Keith and Cole joined.

3rd Circuit Grants Panel Rehearing in Core Communications v. Verizon

6/13. The U.S. Court of Appeals (3rdCir) issued an order [2 pages in PDF] granting panel rehearing in Core Communications v. Verizon, a case regarding the proper procedure for adjudicating disputes regarding interconnection agreements between carriers. This order follows the late recusal of one member of the original three judge panel.

The Court of Appeals held in its May 9, 2007, opinion [29 pages in PDF] that the state public utility commissions that approve these interconnection agreements "are given the first crack at interpreting and enforcing" these agreements. See, story titled "3rd Circuit Holds Interconnection Actions Must First Be Brought in the State PUC" in TLJ Daily E-Mail Alert No. 1,579, May 10, 2007.

The just released order announces the recusal of one Judge who joined in the May 9 opinion, names his replacement, vacates the May 9 opinion, and grants panel rehearing.

The just released order states that "The Honorable D. Brooks Smith participated in the oral argument, panel conference, and joined in the decision in this case, but has discovered facts causing him to recuse from considering the petition for rehearing. As panel rehearing has been granted by the remaining members of the original panel, The Honorable Anthony J. Scirica will be added to complete the coram for further proceedings regarding the merits of the appeal."

This case is Core Communications, Inc. v. Verizon Pennsylvania, Inc., U.S. Court of Appeals for the 3rd Circuit, App. Ct. No. 06-2419, an appeal from the U.S. District Court for the Eastern District of Pennsylvania, D.C. No. 04-cv-04513, Judge Timothy Savage presiding. Judge Michael Fisher wrote the opinion of the Court of Appeals, in which Judges Brooks Smith and Gustave Diamond (USDC/WDPenn) joined.

More Court Opinions

6/13. The U.S. Court of Appeals (9thCir) issued an order and amended opinion [34 pages in PDF] in Sprint Telephony v. City of San Diego, a case regarding municipal regulation of wireless service providers. The Court of Appeals denied the petition for panel rehearing, denied rehearing en banc, and amended its March 13, 2007, opinion. The Court of Appeals affirmed the judgment of the District Court that the wireless zoning ordinance in question is preempted by 47 U.S.C. ง 253, but that this violation creates no private right of action for damages under 18 U.S.C. ง 1983. See also, story titled "9th Circuit Holds That Wireless Zoning Ordinance Violates ง 253(a), But This Creates No Private Right Of Action Under ง 1983" in TLJ Daily E-Mail Alert No. 1,551, March 13, 2007. This case is Sprint Telephony PCS and Pacific Bell Wireless v. County of San Diego, et al., U.S. Court of Appeals for the 9th Circuit, App. Ct. Nos. 05-56076 and 05-56435, appeals from the U.S. District Court for the Southern District of California, D.C. No. CV-03-1398-BTM, Judge Barry Ted Moskowitz presiding. Judge Myron Bright wrote the opinion of the Court of Appeals, in which Judges Wallace Tashima and Carlos Bea joined.

6/13. The U.S. Court of Appeals (FedCir) issued its opinion [PDF] in Entegris v. Pall, a patent infringement case involving technology for filtration systems for semiconductor manufacturing. The Court of Appeals affirmed the District Court's order dissolving the preliminary injunction. The Court of Appeals also dismissed Pall’s appeal of the District Court's contempt order for lack of jurisdiction. This case is Entegris, Inc. v. Pall Corporation, U.S. Court of Appeals for the Federal Circuit, App. Ct. Nos. 2004-1440, 2005-1265, 2005-1266, and 2006-1374, appeals from the U.S. District Court for the District of Massachusetts, Judge George O'Toole presiding.

More News

6/13. Microsoft and Linspire, which makes a Linux based operating system, announced "a broad interoperability, technical collaboration that also includes intellectual property assurances". See, Microsoft release and substantially identical Linspire release. Microsoft and Linspire stated that "Through the agreement, Microsoft and Linspire have developed a framework to provide patent covenants for Linspire customers. The patent covenants provide customers with confidence that the Linspire technologies they use come with rights to relevant Microsoft patents. As well, Linspire now joins a growing group of open source software (OSS) distributors collaborating with Microsoft on efforts to establish rich interoperability, deliver IP assurance to customers and build the bridge between open source and proprietary software."

US FTC and PRC SAIC Enter Into Information Exchange Agreement

6/12. The U.S. Federal Trade Commission (FTC) and the People's Republic of China's (PRC) State Administration for Industry & Commerce (SAIC) entered into a short and vaguely worded Memorandum of Understanding on Consumer Protection Matters [4 pages in PDF]. See also, FTC release.

This MOU states that the two nations "intend to use their best efforts to exchange information".

This MOU, on its face, might be construed to apply to the sharing of investigative information. Moreover, it might be construed within the context of the recently enacted US SAFE WEB Act, which authorizes the FTC to conduct investigations for, and share information with, foreign government agencies, and to enter into agreements with foreign government agencies regarding the sharing of investigative information.

However, this is not the FTC's interpretation of the MOU. TLJ spoke with Yael Weinman of the FTC's Office of International Affairs. She said that this MOU "relates to policy level cooperation, not investigative assistance".

See, full story.

House Approves Caller ID Spoofing Bill

6/12. The House amended and approved HR 251 [LOC | WW], the "Truth in Caller ID Act of 2007", by voice vote.

Caller ID spoofing can be used to facilitate fraud and identity theft. It can be used to defame a person or entity whose caller ID information is spoofed. It also frustrates certain business functions, such as credit card verification and automatic call routing.

This bill would amend 47 U.S.C. ง 227, which pertains to "Restrictions on use of telephone equipment". First, it would add the following prohibition: "It shall be unlawful for any person within the United States, in connection with any telecommunications service or VOIP service, to cause any caller identification service to transmit misleading or inaccurate caller identification information, with the intent to defraud or cause harm."

See, full story.

More News

6/12. The House approved HRes 455 [LOC], a resolution regarding "National Internet Safety Month", by voice vote.

Supreme Court Seeks OSG Brief in Sprint Nextel v. NASUCA

6/11. The Supreme Court of the United States (SCUS) issued an order in Sprint Nextel v. NASUCA, Sup. Ct. No. 06-1184. It states in full that "The Solicitor General is invited to file a brief in this case expressing the views of the United States." See, Orders List [11 pages in PDF], at page 2. The SCUS has not yet decided whether or not to take this case.

At issue is whether states can impose taxes on wireless services, and also prevent the wireless carriers from collecting these taxes through line items on their bills. States seek to collect taxes, and conceal those taxes from consumers. Also, wireless carriers offer uniform national service rates. Taxation and regulation of line items on bills that varies by state compels wireless carriers to either offer state by state business models, or not collect taxes on a state by state basis. The Federal Communications Commission (FCC) issued an order preempting such state by state regulation of line items. The Court of Appeals vacated. The legal issues for the SCUS go to Chevron deference.

This is a case pertaining to 47 U.S.C. ง 332(c)(3)(A). Subsection 332(c)(3)(A) provides in part that "no State or local government shall have any authority to regulate the entry of or the rates charged by any commercial mobile service or any private mobile service, except that this paragraph shall not prohibit a State from regulating the other terms and conditions of commercial mobile services".

On July 31, 2006, the U.S. Court of Appeals (11thCir) issued its opinion [44 pages in PDF] in NASUCA v. FCC, petitions for review of the FCC's order preempting the states from requiring or prohibiting the use of line items in customer billing for cellular wireless services.

The Court of Appeals granted the petition. It held that the FCC exceeded its authority when it preempted the states from requiring or prohibiting the use of line items. It wrote that "The scope of federal authority to regulate ``ratesดด or ``entryดด does not include the presentation of line items on cellular wireless bills. ... This billing practice is a matter of ``other terms and conditionsดด that Congress intended to be regulable by the states."

See, story titled "11th Circuit Rules on Preemption of State Regulation of Wireless Services" in TLJ Daily E-Mail Alert No. 1,430, August 11, 2006.

The Petition for Writ of Certiorari [34 pages in PDF], filed by Sprint Nextel and T-Mobile USA, states that the two issues are first, "Whether the Eleventh Circuit correctly held, under Step One of the analysis set forth in Chevron U.S.A. Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837 (1984), that the FCC erred in ruling that state and local laws prohibiting line item charges on wireless bills were preempted under Section 332(a)(c)(A)", and second, "Whether the Eleventh Circuit erred by applying the presumption against preemption to guide its analysis of Section 332(c)(3)(A) under Chevron Step One."

The Petition states that "wireless carriers typically use ``line itemsดด -- discrete charges on their bills that may vary by jurisdiction -- to collect taxes and fees. They do so in order to make clear that some charges result from taxes and fees and because the use of line items permits carriers to collect taxes and fees only from subscribers in the taxing jurisdiction."

It continues that "States and localities increasingly have imposed taxes and fees on wireless service. They also have recently taken steps to hide those taxes and fees from consumers by prohibiting wireless carriers from using line items to collect them."

See also, NASUCA's opposition brief [PDF].

This case is Sprint Nextel Corporation, et al. v. National Association of State Utility Consumer Advocates, et al., Sup. Ct. No. 06-1184, a petition for writ of certiorari to the U.S. Court of Appeals for the 11th Circuit, App. Ct. Nos. 05-11682 and 05-12601.

Sprint Nextel is represented by Christopher Wright of the law firm of Harris Wiltshire & Grannis. He is a former General Counsel of the Federal Communications Commission (FCC). The NASUCA is represented by Patrick Pearlman of the State of West Virginia Public Service Commission.