Source: http://www.techlawjournal.com/alert/2008/02/26.asp
Timestamp: 2019-04-23 10:19:31+00:00

Document:
TLJ Daily E-Mail Alert No. 1,723, February 26, 2008.
February 26, 2008, Alert No. 1,723.
2/27. The European Commission (EC) demanded more money from Microsoft. This time, it wants 899 Million Euros. The EC again asserted that Microsoft is violating European competition laws.
The EC alleged in a release that this action is a "fine" for Microsoft for its "non-compliance with its obligations under the Commission’s March 2004 Decision"
The EC demanded back in 2004, among other things, that Microsoft license certain proprietary technology and intellectual property rights to its competitors. See, stories titled "European Commission Seeks 497 Million Euros and Code Removal from Microsoft" in TLJ Daily E-Mail Alert No. 863, March 25, 2004, and "European Commission Releases Microsoft Decision" in TLJ Daily E-Mail Alert No. 883, April 23, 2004. See also, Microsoft web page for this proceeding.
Microsoft then sought judicial review in Europe of the EC's 2004 action. On September 17, 2007, the European Court of First Instance (CFI) released its opinion [248 pages in PDF] upholding much of the EC's 2004 decision. See, story titled "European Court of First Instance Rejects Key Parts of Microsoft's Appeal" in TLJ Daily E-Mail Alert No. 1,639, September 14, 2007.
The EC's Nellie Kroes (at left) stated in the EC release that "I hope that today's Decision closes a dark chapter in Microsoft's record of non-compliance with the Commission's March 2004 Decision and that the principles confirmed by the Court of First Instance ruling of September 2007 will govern Microsoft's future conduct".
An alternative interpretation of the EC's latest action against Microsoft, and its pending action against Intel, is that these are the beginning of a dark chapter of EC regulation of U.S. technology companies, under the rubric of competition law, in the absence of any mergers, acquisitions, or collusive conduct among competitors, and without regard for economic analysis of the underlying single firm conduct.
See also, story titled "European Commission Initiates Proceeding Against Intel Alleging Anticompetitive Behavior" in TLJ Daily E-Mail Alert No. 1,617, July 26, 2007.
The EC's release is short. The EC also released a second short release in question and answer format. The EC released no accompanying order, opinion, report, or memorandum. The release does not articulate arguments regarding how this latest action might reduce anti-competitive behavior, maximize consumer welfare, or promote innovation.
The EC wrote only that "the interface information of how to ``communicate´´ with Microsoft’s PC and server operating systems that Microsoft refused to disclose to its competitors, is vital for them to viably compete in the market for work group server operating systems and to be able to bring innovative products to that market."
On February 21, 2008, Microsoft announced in a release and news conference that it is implementing four new interoperability principles. See, story titled "Microsoft Announces Commitment to Open Connections" in TLJ Daily E-Mail Alert No. 1,722, February 25, 2008.
The EC, which is regulating by news release, responded in release dated February 21. It wrote that "This announcement does not relate to the question of whether or not Microsoft has been complying with EU antitrust rules in this area in the past. The Commission would welcome any move towards genuine interoperability. Nonetheless, the Commission notes that today's announcement follows at least four similar statements by Microsoft in the past on the importance of interoperability."
The release continues that "In January 2008, the Commission initiated two formal antitrust investigations against Microsoft -- one relating to interoperability, one relating to tying of separate software products". See, EC release of January 14, 2008, and story titled "EC Again Targets Microsoft" in TLJ Daily E-Mail Alert No. 1,700, January 15, 2008.
The EC's February 21 release continues that "In the course of its ongoing interoperability investigation, the Commission will therefore verify whether Microsoft is complying with EU antitrust rules, whether the principles announced today would end any infringement were they implemented in practice, and whether or not the principles announced today are in fact implemented in practice. Today's announcement by Microsoft does not address the tying allegations."
"In its Microsoft judgment of 17 September 2007 the Court of First Instance established clear principles for dominant companies with regard to interoperability disclosures and the tying of separate software products" the EC wrote in its February 21 release. "In January 2008 the Commission initiated two formal antitrust investigations in order to verify whether Microsoft is complying with the principles established by the Court."
The February 21 release then restates information contained in the January 14 release.
Commentary. The EC has a record of enforcing its competition laws to reduce anti-competitive behavior involving collusion among competitors. Those actions are explainable. In contrast, explaining its actions involving single firm conduct by technology companies is more difficult.
One hypothesis would be that its actions are grounded in economic analysis and expert application of competition law. However, the EC has failed to articulate sound economic rationales for its actions. Moreover, U.S. antitrust agencies, which possess superior resources and expertise in economic analysis to the EC technology regulators, have take no parallel actions. Indeed, some US officials have politely criticized the EC in public statements and speeches and offered more colorful characterizations in discreet communications.
A second hypothesis would be that EC regulators are abusing antitrust enforcement powers to benefit EC companies, to the detriment of US technology companies. However, to date, the EC has primarily targeted US companies in a manner that benefits their US competitors. A related hypothesis would be that the EC is laying the groundwork for a regime that will in the future be used to compel to US companies to transfer proprietary rights and secrets to EC companies, to compel unbundling by US companies for the benefit of EC companies, and to regulate prices charged by US companies to companies and consumers in the EC.
A third hypothesis is that the EC is building an additional tax on foreign technology companies. For example, the EC stated in one of February 27 releases that the money that it confiscates from Microsoft will be "paid into the EU Budget" and that this "reduces the contribution from Member States".
A fourth hypothesis would be that the EC seeks to establish itself as the global regulator and planner of new technologies. For example, Kroes, the EC Competition Commission, stated in a speech earlier this month that "we want to exercise appropriate political influence on the global scene" and "we have to ask ourselves how best to keep a grip on global actors in a global economy". Perhaps Kroes believes that Brussels bureaucrats would be good at planning the global economy. Alternatively, perhaps she believes that getting a grip on global technology companies would increase the business opportunities of Brussels based lawyers, lobbyists, consultants, and regulators.
TLJ offers no assertions as to which, if any, of these hypotheses are correct.
2/25. The Supreme Court denied certiorari in Darden v. Peters, a case regarding the meaning of the intellectual property clause of the Constitution. See, Orders List [10 pages in PDF] at page 3.
This lets stand the May 24, 2007, opinion [14 pages in PDF] of the U.S. Court of Appeals (4thCir). This is a little noted case about standards of review in judicial review of decisions of the Copyright Office. However, to determine which standard of review to apply, the courts had to determine whether or not the review concerns a "constitutional right" within the meaning of the Administrative Procedure Act (APA), at 5 U.S.C. § 706.
Article I, Section 8, of the Constitution provides that "To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries".
The District Court and Court of Appeals ruled that while copyright is in the Constitution, and the Constitution states that it is a "Right", it does not follow that copyright is a Constitutional right.
The Court of Appeals wrote that this clause "grants Congress the power to provide copyright protection to the extent Congress sees fit", that "Congress is under no mandate from this clause, however, to provide copyright protection", and that "whatever rights and remedies exist do so only because Congress provided them".
This is all quite consistent with long standing Supreme Court and lower court precedent. It is also consistent with how the Congress has long treated the intellectual property clause. Nevertheless, it is inconsistent with the plain words of the Constitution, and arguably, the original understanding of the drafters and ratifiers of the Constitution. It is also inconsistent with judicial interpretation of other Constitutional provisions that both identify a right and provide Congressional authority to enact legislation. For example, 14th Amendment (which includes due process and equal protection rights) provides that "The Congress shall have power to enforce, by appropriate legislation, the provisions of this article", but the courts have not held that "whatever rights and remedies exist do so only because Congress provided them".
See also, story titled "4th Circuit Rules Copyright is Not a Constitutional Right" in TLJ Daily E-Mail Alert No. 1,588, May 29, 2007.
2/25. The Supreme Court denied certiorari in Convolve v. Seagate Technology, a case regarding the scope of the waiver of attorney client privilege and work product protection that results when an accused patent infringer asserts an advice of counsel defense to a charge of willful infringement. See, Orders List [10 pages in PDF] at page 4.
This lets stand the August 20, 2007, en banc opinion [42 pages in PDF] of the U.S. Court of Appeals (FedCir) which held that the waiver extends to opinion counsel, but not to trial counsel.
The Court of Appeals wrote that "we conclude that the significantly different functions of trial counsel and opinion counsel advise against extending waiver to trial counsel. Whereas opinion counsel serves to provide an objective assessment for making informed business decisions, trial counsel focuses on litigation strategy and evaluates the most successful manner of presenting a case to a judicial decision maker. ... Therefore, fairness counsels against disclosing trial counsel’s communications on an entire subject matter in response to an accused infringer’s reliance on opinion counsel’s opinion to refute a willfulness allegation."
The Court of Appeals therefore held, "as a general proposition, that asserting the advice of counsel defense and disclosing opinions of opinion counsel do not constitute waiver of the attorney-client privilege for communications with trial counsel."
However, it added that "We do not purport to set out an absolute rule. Instead, trial courts remain free to exercise their discretion in unique circumstances to extend waiver to trial counsel, such as if a party or counsel engages in chicanery."
Similarly, the Court of Appeals held, with respect to work product protection, that the waiver does not extend to trial counsel's work product, "absent exceptional circumstances".
This case is Convolve, Inc. v. Seagate Technology, LLC, U.S. Supreme Court, Sup. Ct. No. 07-656, a petition for writ of certiorari to the U.S. Court of Appeals for the Federal Circuit, App. Ct. No. 06-M830. The Court of Appeals heard a petition for writ of mandamus to the U.S. District Court for the Southern District of New York. See also, Supreme Court docket.
Buc International filed a complaint in U.S. District Court (SDFl) against six defendants alleging direct, vicarious and contributory copyright infringement. Buc also alleged antitrust law violations, unfair and deceptive trade practices under state law, and breach of contract; those claims are not pertinent to the present appeal.
Buc settled with several defendants, for a total of $790,000. Buc then prevailed at the bench trial against the non-settling defendants, and received an award of $1,598,278. These non-settling defendants argued that this award should be reduced, pursuant to the one satisfaction rule, by the amount of the settlement amounts. The District Court denied the request.
This appeal followed. The Court of Appeals reversed.
The Court of appeals wrote that the one satisfaction rule "has its roots in elementary principles of tort law. ... The rule generally provides that a plaintiff is entitled to only one satisfaction for a single injury, such that amounts received in settlement from an alleged tortfeasor are credited against judgments for the same injury against non-settling tortfeasors." The Court added that the rule "operates to prevent double recovery, or the overcompensation of a plaintiff for a single injury."
The Court of Appeals held that copyright infringement is in the nature of tort, and that principles of tort law limiting multiple recoveries for one injury apply to copyright infringement actions.
It wrote, "To hold otherwise would allow a plaintiff to recover multiple times for a single injury, frustrating this elementary principle of tort law in a manner that we cannot imagine envisioned by Congress."
This case is Buc International, Inc. v. International Yacht Council Ltd., et al., U.S. Court of Appeals for the 11th Circuit, App. Ct. No. 05-16151, an appeal from the U.S. District Court for the Southern District of Florida, D.C. No. 02-60772-CV-WPD. Judge Barkett wrote the opinion of the Court of Appeals, in which Judges Anderson and Trager, sitting by designation, joined.
2/25. The Supreme Court denied certiorari in Autotech Tech v. Integral Research, a case regarding jurisdiction of a U.S. District Court over a claim against a semiconducter maker owned by a foreign government. This lets stand the opinion of the U.S. Court of Appeals (7thCir), which vacated the judgment and writ of execution of the District Court. The Court of Appeals held that the District Court properly exercised jurisdiction over a claim by a U.S. company (Autotech) against a commercial semiconductor manufacturer (Integral) that is owned by a foreign government (Belarus). However, it vacated the judgment against the Integral on other procedural grounds. See also, story titled "7th Circuit Addresses Jurisdiction in Actions Against Companies Owned by Foreign Governments" in TLJ Daily E-Mail Alert No. 1,631, August 30, 2007. This case is Autotech Technologies L.P. v. Integral Research & Development Corporation, U.S. Supreme Court, Sup. Ct. No. 07-879, a petition for writ of certiorari to the U.S. Court of Appeals for the 7th Circuit, App. Ct. No. 06-1718. The Court of Appeals heard an appeal from the U.S. District Court for the Northern District of Illinois, Eastern Division, D.C. No. 96 C 3193, Judge David Coar presiding. Judge Wood wrote the opinion of the Court of Appeals, in which Judge Kane and Williams joined. See also, Supreme Court docket.
2/25. The U.S. Court of Appeals (5thCir) issued its divided opinion [PDF] in American Rice v. Producers Rice Mill, a trademark and contract case involving marketing of rice in Saudi Arabia. This case addresses several issues, including extraterritorial applications of US law, likelihood of confusion, and remedies. This case is American Rice, Inc. v. Producers Rice Mill, Inc., U.S. Court of Appeals for the 5th Circuit, App. Ct. No. 06-20645, an appeal from the U.S. District Court for the Southern District of Texas. Judge Eugene Davis wrote the opinion of the Court of Appeals, in which Judge Higginbotham joined. Judge Jerry Smith dissented on the likelihood of confusion issue.
Tech Law Journal experienced technical difficulties sending e-mail on Monday and Tuesday, February 25-26, 2008. TLJ also received numerous e-mail error messages indicating non-delivery of TLJ Daily E-Mail Alert No. 1,722. Hence, this issue has been published in the TLJ web site.
The House will meet at 10:00 :AM for legislative business. See, Rep. Hoyer's schedule for week of February 25.
The Senate will meet at 9:30 AM. It will resume consideration of the motion to proceed on S 2633, [LOC | WW], a bill related to Iraq.
8:30 AM - 5:00 PM. The U.S.-China Economic and Security Review Commission will hold a public hearing titled "China's Views of Sovereignty and Methods of Access Control". The hearing will also address "ways that China may be influencing the development of international sovereignty laws and norms in space and cyberspace". See, notice in the Federal Register, January 30, 2008, Vol. 73, No. 20, at Pages 5631-5632. Location: Room 562, Dirksen Building, Capitol Hill.
10:00 AM. The House Commerce Committee's (HCC) Subcommittee on Telecommunications and the Internet will hold a hearing regarding "H.R. __, a Discussion Draft on Wireless Consumer Protection and Community Broadband Empowerment". The witnesses will be Steve Largent (CTIA), Larry Darby (American Consumer Institute), Chris Murray (Consumers Union), and Joey Durel (City of Lafayette, Louisiana). This event will be webcast by the HCC. Location: Room 2322, Rayburn Building.
1:30 PM. The House Judiciary Committee's (HJC) Subcommittee on Courts, the Internet and Intellectual Property will hold an oversight hearing on the U.S. Patent and Trademark Office (USPTO). See, notice. Location: Room 2141, Rayburn Building.
6:00 - 8:15 PM. The Federal Communications Bar Association's (FCBA) Enforcement Committee will host a closed event titled "FCC Hearings and Investigations -- Nuts and Bolts Review". See, notice and registration page. Registrations are due by 5:00 PM on February 25. This event offers continuing legal educations (CLE) credits. The price to attend ranges from $25 to $135. Location: Wilmer Hale, 1875 Pennsylvania Ave., NW.
Day three of a three day conference hosted by the National Association of Broadcasters (NAB) titled "2008 NAB State Leadership Conference". See, conference web site. Location: Mandarin Oriental Hotel.
Deadline to submit requests to the Federal Trade Commission (FTC) to be panelists at its May 6-7, 2008, workshop titled "Beyond Voice: Mapping the Mobile Marketplace". See, notice.
The House will meet at 10:00 AM for legislative business. See, Rep. Hoyer's schedule for week of February 25.
9:00 AM - 12:00 NOON. The Department of Commerce's (DOC) National Telecommunications and Information Administration (NTIA) will hold a public meeting to to discuss the mid-term review of the Joint Project Agreement (JPA) between the DOC and the Internet Corporation for Assigned Names and Numbers (ICANN). See, notice in the Federal Register, January 24, 2008, Vol. 73, No. 16, at Page 4181. Location: DOC, Auditorium, 1401 Constitution Ave., NW.
10:00 AM. The Senate Judiciary Committee (SJC) may hold an executive business meeting. The agenda includes consideration of several bills, including S 2449 [LOC | WW], the "Sunshine in Litigation Act of 2007", and S 352 [LOC | WW], the "Sunshine in the Courtroom Act of 2007". The agenda also includes consideration of the nominations of Kevin O'Connor (to be Associate Attorney General) and Gregory Katsas (to be Assistant Attorney General in charge of the Civil Division). The SJC rarely follows its published agendas. All of the above listed agenda items have been on prior agendas. See, notice. Location: Room 226, Dirksen Building.
10:00 AM. The House Homeland Security Committee (HHSC) will hold a hearing titled "Cyber Initiative". The witnesses will be Robert Jamison (DHS's Under Secretary for National Protection and Programs), Scott Charbo (DHS's Deputy Under Secretary for National Protection and Programs Directorate), Karen Evans (OMB), and Shawn Henry (FBI's Deputy Assistant Director of the Cyber Division). This hearing will be webcast by the HHSC. For more information, contact Dena Graziano or Adam Comis at 202-225-9978. Location: Room 311, Cannon Building.
12:00 NOON - 2:00 PM. The Federal Communications Bar Association's (FCBA) International Telecommunications Practice Committee will host a panel discussion titled "EU Telecommunications Law Developments". The speakers will be Gerry Oberst (Hogan & Hartson), Winston Maxwell (Hogan & Hartson), and David Gross (Department of State). Lunch will be provided by Hogan & Hartson. RSVP to aqfitzgerald at hhlaw dot com. Location: Hogan & Hartson, Litigation Center, 555 13th St., NW.
12:15 PM. The Federal Communications Bar Association's (FCBA) Wireless Practice and Privacy and Data Security Committees will host a panel discussion titled "Protecting Wireless Consumer Privacy". The speakers will be Michael Altschul (CTIA) and David Solomon (Wilkinson Barker & Knauer). Lunch will be served. The price to attend is $15.00. See, notice and registration page. Registrations are due by 12:00 NOON on February 26. Location: Sidley Austin, 1501 K St., NW.
2:00 - 3:00 PM. The President's National Security Telecommunications Advisory Committee (NSTAC) will hold a partially closed meeting by teleconference. The agenda of the open portion of the meeting, which begins at 2:00 PM, includes a discussion and vote on the NSTAC's Global Positioning Systems report. The agenda of the closed portion of the meeting, which begins at 2:30 PM, includes a discussion of the results of the NSTAC's investigation of the global network infrastructure environment, and a discussion of the work of the NSTAC's Network Security Scoping Group. See, notice in the Federal Register, February 4, 2008, Vol. 73, No. 23, at Pages 6521-6522.
Deadline for the Department of Education's National Mathematics Advisory Panel to submit its final report to the President. See, notice in the Federal Register, August 20, 2007, Vol. 72, No. 160, at Pages 46452-46453.
Rep. Hoyer's schedule for week of February 25 states that "no votes are expected in the House".
10:00 AM. Deadline for foreign governments to submit comments to the Office of the U.S. Trade Representative (OUSTR) to assist it in making Special 301 identifications of countries that deny adequate and effective protection of intellectual property rights or deny fair and equitable market access to U.S. persons who rely on intellectual property protection. See, story titled "OUSTR Seeks Special 301 Comments on Countries that Deny Adequate IPR Protection" in TLJ Daily E-Mail Alert No. 1,703, January 22, 2008, and notice in the Federal Register, January 16, 2008, Vol. 73, No. 11, at Pages 2958-2959.
12:00 NOON - 2:00 PM. The iGrowthGlobal (IGG) will host a panel discussion titled "Network Management: The Latest Battle Over Net Neutrality". The speakers will be Scott Wallsten (IGG), David Burstein (DSLPrime), Jay Monahan (Vuze, Inc.), George Ou (ZDNet), Haruka Saito (Counselor for Telecom Policy, Embassy of Japan), and Christopher Yoo (University of Pennsylvania). Lunch will be served. Register by contacting Ashley Creel at 202-828-4405 or creela at igrowthglobal dot org. Location: Room 2322, Rayburn Building (House Commerce Committee's 3rd floor hearing room).
Deadline to submit to the Department of Commerce's (DOC) National Telecommunications and Information Administration (NTIA) expressions of interest to participate in the spectrum sharing innovation test-bed. See, notice in the Federal Register, February 5, 2008, Vol. 73, No. 24, at Pages 6710-6711.
Deadline to submit comments or objections to the Copyright Royalty Judges' proposed rules that set the rates and terms for the making of an ephemeral recording of a sound recording by a business establishment service for the period 2009-2013. See, notice in the Federal Register, January 30, 2008, Vol. 73, No. 20, at Pages 5466-5470.
Deadline to submit petitions to participate (and filing fees) in the Copyright Royalty Judges' proceeding to determine the Phase II distribution of 1998 and 1999 royalties collected under the cable statutory license. See, notice in the Federal Register, January 30, 2008, Vol. 73, No. 20, at Page 5596-5597.
Deadline to submit comments to the Copyright Royalty Judges in response to its request for comments regarding controversies at Phase I and Phase II for distribution of the 1999 through 2005 royalty funds collected under the satellite carrier statutory license. The deadline to submit comments is February 29, 2008. See, notice in the Federal Register, January 30, 2008, Vol. 73, No. 20, at Page 5597.
Deadline to submit comments to the Copyright Royalty Judges regarding a motion for partial distribution funds under the partial Phase I settlement in connection with the 2004 and 2005 cable royalty funds. Comments are due by February 29, 2008. See, notice in the Federal Register, January 30, 2008, Vol. 73, No. 20, at Pages 5597-5598.
Deadline to submit initial comments to the Federal Communications Commission (FCC) in response to its Third Further Notice of Proposed Rulemaking regarding cable carriage of digital television broadcast signals. The FCC adopted this item on September 11, 2007, and released the text [68 pages in PDF] on November 30, 2007. This item is FCC 07-120 in CS Docket No. 98-120. See, notice in the Federal Register, February 1, 2008, Vol. 73, No. 22, at Pages 6099-6101, and story titled "FCC Adopts R&O and Further NPRM Regarding Cable Carriage of Digital Broadcast TV Signals" in TLJ Daily E-Mail Alert No. 1,640, September 17, 2007.
10:00 AM - 4:00 PM. The U.S. Patent and Trademark Office's (USPTO) National Medal of Technology and Innovation Nomination Evaluation Committee will hold a closed meeting to discuss persons and companies that have been nominated for awards. See, notice in the Federal Register, February 12, 2008, Vol. 73, No. 29, at Pages 8033-8034. Location: USPTO, 600 Dulany Street, Alexandria, VA.
Day one of a three day conference hosted by the National Institute of Standards and Technology (NIST) and others titled "7th Symposium on Identity and Trust on the Internet" or "IDtrust 2008". See, notice. The basic price to attend is $110. Location: NIST, 100 Bureau Drive, Gaithersburg, MD.
Day one of a two day conference hosted by the George Washington University's (GWU) Graduate School of Public Management's (GSPM) Institute for Politics, Democracy & the Internet titled "Politics Online Conference 2008". See, conference web site. Location: Renaissance Hotel, 999 9th St., NW.
2/25. The Computer and Communications Industry Association (CCIA) issued a release regarding its August 1, 2007, complaint [PDF] submitted to the Federal Trade Commission (FTC) regarding copyright notices.
The CCIA alleged in its complaint that Major League Baseball, National Football League, NBC/Universal, and others violated Section 5 of the FTC Act, which is codified at 15 U.S.C. § 45, in connection with their alleged use of deceptive and threatening copyright notices. See also, CCIA's August 1, 2007, release.
Section 5 is not directed at copyright notices or sports programming. Rather, it is a broad prohibition of unfair and deceptive trade practices. It provides that "Unfair methods of competition in or affecting commerce, and unfair or deceptive acts or practices in or affecting commerce, are hereby declared unlawful."
The CCIA requested that the FTC order the copyright holders to cease making deceptive statements. It also sought an order directing copyright holders to "forebear from attempting to force consumers into waiving their rights through contractual instruments". It also sought an order directing the copyright holders to "provide for educational awareness programs" from third parties regarding "fair use rights".
Nevertheless, Ed Black, head of the CCIA, stated that "We are pleased with the statements of the FTC that acknowledge the risks to consumer rights ... The FTC letter issues an early warning to copyright owners that they are not immune from consumer protection laws and that the FTC will be monitoring the situation."
Also, TLJ spoke with Black. He added that "we will be submitting more information to the FTC of various types".
The FTC letter states that "Copyright warnings can serve the valuable purpose of notifying consumers in a succinct fashion that infringement has potentially serious legal consequences. ``FBI copyright warnings´´ on DVD and VHS tape cases, as well as in the motion pictures embodied in the DVDs and tapes therein, can be evidence in criminal piracy cases that defendants' copyright infringement was willful."
"Copyright owners are not, however, entitled to engage in deceptive and unfair practices to protect their copyrighted works against infringement."
It continues that "After reviewing the various warnings cited in the CCIA's complaint, the FTC staff concludes that consumers would likely interpret the statements as representations that the material at issue is copyrighted and that there can be significant penalties for infringing that copyright. We do not have a sufficient basis to conclude that consumers would view those brief warnings as complete statements of their rights with respect to the works. Nor do we have a sufficient basis to conclude that consumers would be likely to refrain from engaging in lawful activities as a consequence of reading those warnings."
However, the letter adds that "FTC staff encourages copyright owners to be accurate in their characterizations of their rights and any limitations on consumers' rights to use copyrighted works. Widespread use of inaccurate copyright warnings could contribute to consumers' misunderstanding of the statutory protections available to them under the Copyright Act. Further, if consumers routinely confront exaggerated and inaccurate copyright warnings they may tend to disregard them altogether, to the detriment of consumers and copyright owners alike."
See also, August 3, 2007, letter [PDF] of the Public Knowledge and other groups, and August 1, 2007, letter [4 pages in PDF] of the Library Copyright Alliance (LCA).

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