Source: http://www.techlawjournal.com/alert/2003/09/22.asp
Timestamp: 2019-04-20 10:13:18+00:00

Document:
TLJ Daily E-Mail Alert No. 743, September 22, 2003.
September 22, 2003, 9:00 AM ET, Alert No. 743.
9/20. The Internet Corporation for Assigned Names and Numbers (ICANN) released a statement on September 19, 2003 regarding VeriSign's deployment of wildcard service into the .com and .net top level domain zones. It asked VeriSign to "voluntarily suspend the service". On September 20 the Internet Architecture Board (IAB) released a report that reviews the nature of the service, and the problems that it has created. For example, it finds that the service "broke several simple spam filters", and creates "significant privacy concerns".
"Since the deployment, ICANN has been monitoring community reaction, including analysis of the technical effects of the wildcard, and is carefully reviewing the terms of the .com and .net Registry Agreements." The ICANN added that "In response to widespread expressions of concern from the Internet community about the effects of the introduction of the wildcard, ICANN has requested advice from its Security and Stability Advisory Committee, and from the Internet Architecture Board, on the impact of the changes implemented by VeriSign. ICANN's Security and Stability Advisory Committee is expected to release an objective expert report concerning the wildcard later today."
The ICANN stated that it "called upon VeriSign to voluntarily suspend the service until the various reviews now underway are completed."
IAB Report. The IAB subsequently released its report titled "IAB Commentary: Architectural Concerns on the use of DNS Wildcards". It explains what wildcards are and why they create problems, reviews several examples of problems that they create, and offers policy recommendations.
The IAB explained that "Web browsers all over the world stopped displaying ``page not found´´ in the local language and character set of the users when given incorrect URLs rooted under these TLDs. Instead, these browsers now display an English language search page from a web server run by the zone operator."
The IAB reported that one of the problems that has resulted from VeriSign's installation of these wildcards is that it "broke several simple spam filters commonly used to front end inbound mail servers, as well as more complex filtering that checks for the existence of a sending domain in order to screen out obviously bogus senders".
The IAB also reported that the installation creates privacy problems. It wrote that "An interception service with this kind of scope raises significant privacy concerns, since traffic received by the interception service is, pretty much by definition, not going where its sender originally intended. The potential for abuse in this situation is very high, and makes the interception service an even more attractive target, this time for attackers who wish to gain control of it in order to practice such abuse."
The IAB also addressed security problems. It states that "Even for cases in which the redirection service works as intended, such a service creates a very large single point of failure. Single points of failure are obvious targets both for deliberate attacks and for the sort of accidental "attacks" caused by bugs and configuration errors which already generate much of the traffic at the DNS name servers for the root zone. Furthermore, the IP address associated with this single point of failure is a likely target both for routing attacks intended to redirect the IP address to some other server.
The IAB proposed the following guidelines. "If you want to use wildcards in your zone and understand the risks, go ahead, but only do so with the informed consent of the entities that are delegated within your zone."
Also, "we do not recommend the use of wildcards for record types that affect more than one application protocol. At the present time, the only record types that do not affect more than one application protocol are MX records."
The IAB added that "We hesitate to recommend a flat prohibition against wildcards in ``registry´´-class zones, but strongly suggest that the burden of proof in such cases should be on the registry to demonstrate that their intended use of wildcards will not pose a threat to stable operation of the DNS or predictable behavior for applications and users."
Finally, the IAB stated that "We recommend that any and all TLDs which use wildcards in a manner inconsistent with this guideline remove such wildcards at the earliest opportunity."
9/19. The U.S. Court of Appeals (5thCir) issued its opinion [PDF] in Southwestern Bell Telephone Company v. El Paso, a case involving the laying of fiber optic cable, public rights of way, and local authorities who seek to extract fees. The Appeals Court upheld the District Court's grant of summary judgment to SWBT, which is laying the cable, and against a local water district, which is trying to charge fees for laying cable across its ditches.
Southwestern Bell Telephone Company (SWBT) is a telephone phone company that provides services in, among other places, the City of El Paso, which is located in west Texas. The El Paso County Water Improvement District (EPCWID) is a water district organized under Texas law. In 1996, the federal government deeded to the EPCWID certain irrigation canals, laterals and ditches, which the Appeals Court refers to as "facilities".
The EPCWID established application procedures that include the payment of an application fee of $500, followed by an ad hoc charge for the crossing. SWBT is placing lines, including fiber optic cable, across the EPCWID's facilities.
The incident that gave rise to this litigation was SWBT's laying of fiber optic cable along a public road that crossed one of EPCWID's facilities. The EPCWID threatened to arrest the line crews for trespass and remove the cables there and elsewhere if SWBT did not comply with EPCWID's application process and pay it the fees that it demanded.
SWBT filed a complaint in U.S. District Court (WDTex) against the City of El Paso and EPCWID seeking declaratory and injunctive relief. It alleged that EPCWID's application process and fees for the crossing of its facilities constituted an illegal taking in violation of the 5th Amendment and the Contract Clause of the U.S. Constitution, a violation Section 151 of the Communications Act, codified at 47 U.S.C. S 151, and a violation of the Texas Utility Code, § 181.082.
The District Court granted summary judgment to SWBT, but denied its request for attorney's fees. The Appeals Court affirmed the summary judgment on state law grounds, declined to address federal issues, and reversed and remanded the denial of attorney's fees. The Appeals Court also rejected several frivolous procedural issues raised by the EPCWID on appeal.
The is the second time that this dispute has been to the Fifth Circuit. On March 19, 2001, the Appeals Court issued its opinion rejecting the EPCWID's 11th Amendment immunity argument. The District Court denied the motion, on the grounds that the EPCWID is not an arm of the state. The Appeals Court affirmed. See, TLJ Daily E-Mail Alert No. 147, March 20, 2001; see also, Southwestern Bell Tel. Co. v. City of El Paso, 243 F.3d 936.
In the present appeal, the District Court had granted summary judgment to SWBT, first, on the grounds that SWBT had authority, pursuant to Texas Utilities Code § 181.082, to lay the fiber optic cable across the EPCWID's ditch because it was laying within the right of way of a public road that crossed the ditch.
Section 181.082 provides that "A telephone or telegraph corporation may install a facility of the corporation along, on, or across a public road, a public street, or public water in a manner that does not inconvenience the public in the use of the road, street, or water."
"The roadways are public, and § 181.082 applies", wrote Judge Higginbotham for a unanimous three judge panel of the Appeals Court. "It is well established in Texas law that § 181.082 and its predecessor statutes grant telephone companies broad powers to install their lines within the rights-of-ways of public roads, and that local governments cannot deny this right."
The Appeals Court added that "it is contrary to the policy of § 181.082 to allow EPCWID to regulate or charge a fee for SWBT's facilities that are within the rights-of-ways of public roads."
The Appeals Court declined to rule on several other grounds upon which it might have also affirmed the District Court. For example, the District Court held, in the alternative, that the EPCWIC's canals and ditches carry waters, which are public waters, which bring the EPCWID's facilities within the scope of § 181.082. The Appeals Court wrote that "This alternative basis is in fact much broader than simply allowing SWBT to utilize the rights-of-ways of public roads to cross EPCWID's facilities since it would allow SWBT to cross EPCWID’s property at any point. Given that the summary judgment evidence before the court concerns only cables laid within the rights-of-ways of public roads, and the fact that there is no guidance from the state courts on this difficult issue, we decline to address this alternative basis to sustain the summary judgment."
Finally, the Appeals Court ducked the Communications Act and constitutional claims. It wrote only that "Because state law provides an adequate basis for deciding the issue, we also decline to consider" the federal claims.
This case is Southwestern Bell Telephone Company v. City of El Paso, El Paso County Water Improvement District, et al., Nos. 02-50825 and 02-50899, appeals from the U.S. District Court for the Western District of Texas.
9/12. The U.S. Court of Appeals (3rdCir) issued its opinion [11 pages PDF] in WorldCom v. GraphNet. The Appeals Court reversed the District Court's dismissal of a complaint brought by one communications carrier against another for failure to make payments under a pair of contracts. The Appeals Court ruled that the District Court erred in it application of Section 211 of the Communications Act, and regulations thereunder, and the filed rate doctrine.
WorldCom (now known as MCI) is a large telecommunications company. Graphnet provides communications services and network products. WorldCom and Graphnet entered into a contract under which WorldCom provided two-way telex transmissions between their respective networks for telex traffic originating on each other's networks. Graphnet failed to pay Worldcom pursuant to the contract. Graphnet also failed to pay for over three hundred thousand dollars for additional telecommunications equipment and services provided pursuant to second contract. WorldCom did not file either of these contracts with the Federal Communications Commission (FCC).
WorldCom filed a complaint in U.S. District Court (EDVa) against Graphnet alleging breach of contract and unjust enrichment. The action was transferred to the District of New Jersey. Graphnet sought to avoid judgment by raising a number of issues, including jurisdiction, statute of limitations, and an alleged prior settlement agreement. However, the noteworthy aspect of this case is Graphnet's affirmative defense of failure to state a claim, arising out of WorldCom's not having filed the contracts at issue with the FCC.
The District Court held that Worldcom could not recover under any of the contracts at issue because they were never filed with the FCC. It held that 47 U.S.C. § 211 requires the filing of all contracts with the FCC, and that failure to do so bars any recovery, even under the theory of unjust enrichment. It further held that WorldCom's claims are barred by the filed rate doctrine.
The Appeals Court reversed. First, it held that the District Court misread Section 211.
Section 211 provides, at subsection (a), that "Every carrier subject to this chapter shall file with the Commission copies of all contracts, agreements, or arrangements with other carriers, or with common carriers not subject to the provisions of this chapter, in relation to any traffic affected by the provisions of this chapter to which it may be a party."
However, subsection 211(b) qualifies this. It provides that "The Commission shall have authority to require the filing of any other contracts of any carrier, and shall also have authority to exempt any carrier from submitting copies of such minor contracts as the Commission may determine."
The Appeals Court wrote that "The district court erred by concluding that Worldcom was required to file the contracts at issue. This complex issue could not be resolved at this stage in the litigation. The fact that there was no filed tariff does not itself violate the FCA. Under the FCA, a carrier may conduct its business either by tariff or by contract."
The Court continued that if a common carrier chooses to conduct business by contract, it is required file copies of all contracts with other common carriers. However, it added that subsection 211(b) empowers the FCC to exempt carriers from filing certain contracts. Moreover, the FCC has promulgated regulations exempting certain contracts.
The relevant regulation, 47 C.F.R. § 43.51, provided, at the relevant time, in part, that "(a) Any communications common carrier engaged in domestic or foreign communication, or both, which has not been classified as non-dominant pursuant to Section 61.12(e) of the Commission's Rules, 47 C.F.R. § 61.12(e), is not treated under the regulatory forbearance policies established by the Commission, and which enters into a contract with another carrier must file with the Commission, within thirty (30) days of execution, a copy of each contract, agreement, concession, license, authorization or other arrangement to which it is a party ..."
The Appeals Court wrote that "this language exempts non-dominant carriers from the filing requirement", and hence, "the district court erred by finding that Worldcom was required to file the contracts at issue." However, the Court added that "At this stage in the litigation, it cannot be determined that Worldcom was so required." The District Court must, on remand, determine whether "Worldcom was, in fact, non-dominant in the national long distance field at the time and that the contracts at issue involved national long distance services."
The Court also addressed what would be the consequences of a finding that the WorldCom Graphnet contracts are covered by the filing requirements of subsection 211(a), and are not exempted by subsection 2119b) and FCC regulations.
The Appeals Court wrote that "the district court held that if a party fails to file a contract under section 211, it will suffer a complete and total forfeiture. It erroneously relied on the inapposite ``filed rate doctrine´´ in reaching this conclusion. We find nothing in either the FCA, the decisions of the Common Carrier Bureau or in the caselaw from the federal courts that would support such an extreme penalty for failing to file a contract. In fact, relevant authority is to the contrary."
The Court reasoned that "section 211 says nothing about any penalty for failing to file a contract. Other sections of the FCA, however, specifically lay out penalties for violation of their provisions. ... If Congress intended the extraordinary penalty that Graphnet advocates, we would expect it to say so explicitly."
Hence, the Court concluded that "Absent an express statutory statement to the contrary, we conclude that a violation of section 211’s filing requirement does not require that Worldcom forfeit any right to be compensated for services and equipment provided to Graphnet pursuant to an unfiled contract."
Finally, the Appeals Court held that the filed rate doctrine does not apply to this situation. "The filed rate doctrine forbids charging or collecting rates for services that vary with the rates scheduled for those services in a filed tariff", wrote the Court. "Here, however, no filed tariff appears to have covered the services provided pursuant to the contracts at issue. The doctrine is therefore inapposite because there is no filed tariff with which the contracts conflict."
The Court added that "If Worldcom was required to file the contracts at issue, its failure to do so would not by itself preclude Worldcom from recovering under those contracts. If the contracts are not enforceable for some other reason, Worldcom could still recover the value of its services under a theory of unjust enrichment. The district court erred by concluding otherwise."
This case is WorldCom, Inc. v. GraphNet, Inc., an appeal from the U.S. District Court for the District of New Jersey, D.C. No. 00-cv-05255, Judge William Walls presiding.
9/18. President Bush nominated Kenneth Karas to be a Judge of the U.S. District Court (SDNY). See, White House release. Karas has been an Assistant U.S. Attorney since 1992. He handles terrorism related cases.
9/17. The Senate confirmed Stephen Robinson to be a Judge of the U.S. District Court for the Southern District of New York. See, Congressional Record, September 17, 2003, at S11623.
9/17. The Senate confirmed Kevin Castel to be a Judge of the U.S. District Court for the Southern District of New York. See, Congressional Record, September 17, 2003, at S11623.
9/17. The Senate confirmed Richard Howell to be a Judge of the U.S. District Court for the Southern District of New York. See, Congressional Record, September 17, 2003, at S11623.
There was no issue of the TLJ Daily E-Mail Alert on Friday, September 19.
The Senate will meet at 2:00 PM. It is schedule to resume consideration of HR 2691, the Department of the Interior Appropriations Act of 2004.
1:00 -3:00 PM. The Federal Communications Commission's (FCC) Office of Engineering and Technology (OET) will sponsor a tutorial titled "Technical Challenges Associated with the Evolution to VoIP". The speakers will include Susan Spradley (Wireline Networks) and Alan Stoddard (Nortel Networks). The tutorial will cover (1) an overview of IP telephony, (2) the routing of information through the packet network, (3) provision of voice and IP communication services on a single data network, (4) network engineering rules and parameters, (5) various transition models to IP telephony, and (6) business models for service providers and end users. See, FCC release [PDF]. Location: FCC, Commission Meeting Room (TW-C305), 445th 12th Street SW., Washington, D.C.
6:00 - 9:15 PM. The Intellectual Property Law Section of the D.C. Bar Association will host a CLE course titled "Patent Damages: Discovery, Pre-trial and Litigation Strategies". Prices vary. For more information, call 202 626-3488. Location: D.C. Bar Conference Center, 1250 H Street, NW, B-1 level.
Day one of a two day meeting hosted by the International Trademark Association (INTA) titled "Trademarks in Cyberspace". See, conference web site. Location: The Ritz-Carlton, Pentagon City, Arlington, VA.
DEADLINE EXTENDED TO OCTOBER 6. Deadline to submit comments to the Executive Office of the President's (EOP) Office of Science and Technology Policy's (OSTP) National Science and Technology Council's (NSTC) Subcommittee on Research Business Models regarding the relationship between federal agencies and researchers. The NSTC published its original notice in the Federal Register on August 6 stating that it "is undertaking a review of policies, procedures, and plans relating to the business relationship between federal agencies and research performers with the goal of improving the performance and management of federally sponsored basic and applied scientific and engineering research." See, Federal Register, August 6, 2003, Vol. 68, No. 151, at Pages 46631 - 46632. See also, notice of extension in the Federal Register, September 16, 2003, Vol. 68, No. 179, at Pages 54226 - 54227.
Deadline to submit comments to the Copyright Office (CO) in response to its Notice of Proposed Rulemaking (NPRM) regarding rates and terms for the use of sound recordings in eligible nonsubscription transmissions made by noncommercial licensees, and for the making of related ephemeral recordings. See, notice in the Federal Register, August 21, 2003, Vol. 68, No. 162, at Pages 50493 - 50495.
9:30 AM. John Muleta, Bureau Chief of the Federal Communications Commission's (FCC) Wireless Telecommunications Bureau (WTB), will hold a "briefing for members of the media". RSVP to Marybeth McCarrick at 202 418-0654. Location: FCC, 445 12th St., SW, Room TW A-402/A-442.
9:30 AM. The Senate Committee on Aging will hold a hearing on "to examine HIPAA medical privacy and transaction rules". Location: Room 628, Dirksen Building.
12:00 NOON - 12:00 PM. The Computer & Telecommunications Law Section, and the Antitrust Section, of the D.C. Bar Association will host a brown bag lunch. The topic will be "Telecommunications Access". Location: D.C. Bar Conference Center, 1250 H Street NW, B-1 level.
12:15 PM. The Federal Communications Bar Association's (FCBA) Cable Practice Committee will host a brown bag lunch on "current cable issues". For more information, contact Frank Buono at fbuono@willkie.com. RSVP to wendy@fcba.org Location: Willkie Farr & Gallagher, 1875 K Street, NW.
1:00 PM. The House Commerce Committee's Subcommittee on Telecommunications and the Internet will meet to mark up HR 2898, the "E-911 Implementation Act of 2003". Press contact: Ken Johnson or Vikki Riley at 202 225-5735. Location: Room 2322, Rayburn Building. This meeting was previously scheduled for September 18.
2:00 PM. The Senate Banking Committee will hold a meeting to mark up several bills, including the "National Consumer Credit Reporting System Improvement Act of 2003" and the "Defense Production Reauthorization Act of 2003". See, notice. Location: Room 538, Dirksen Building.
4:00 PM. House Commerce Committee's Subcommittee on Commerce, Trade and Consumer Protection and the House Judiciary Committee's (HJC) Subcommittee on Courts, the Internet and Intellectual Property will hold a hearing on HR __, the "Database and Collections of Information Misappropriation Act of 2003". Press contact: Ken Johnson or Vikki Ehrlich at 202 225-5735. Location: Room 2141 (HJC hearing room), Rayburn Building.
4:00 PM. Douglas Lichtman (University of Chicago Law School) will speak on "Prosecution History Estoppel: Empirical Evidence from Patent Prosecution". For more information, contact Robert Brauneis at 202 994-6138 or rbrauneis@law.gwu.edu. Location: George Washington University Law School, Faculty Conference Center, 5th Floor, Burns Building, 716 20th Street, NW.
Day two of a two day meeting hosted by the International Trademark Association (INTA) titled "Trademarks in Cyberspace". See, conference web site. Location: The Ritz-Carlton, Pentagon City, Arlington, VA.
Deadline to submit comments to the Federal Communications Commission (FCC) regarding its notice of proposed rulemaking (NPRM) pertaining to its rules governing the provision of air ground telecommunications services on commercial airplanes in order to enhance the options available to the public. The FCC adopted this NPRM on April 17, 2003, and released it on April 28, 2003. This is WT Docket No. 03-103. See, notice in the Federal Register, July 25, 2003, Vol. 68, No. 143, at Pages 44003 - 44011.
Deadline to submit reply comments to the Federal Communications Commission (FCC) in response to its notice of proposed rulemaking (NPRM) regarding making more spectrum available for unlicensed devices, including WiFi, in the 5 GHz band. See, stories titled "FCC Adopts NPRM to Increase Unlicensed Spectrum" in TLJ Daily E-Mail Alert No. 663, May 16, 2003; "FCC Releases NPRM Regarding Increasing Amount of Unlicensed Spectrum" in TLJ Daily E-Mail Alert No. 674, June 5, 2003, and "Delegates Discuss World Radiocommunications Conference" in TLJ Daily E-Mail Alert No. 703, July 22, 2003. See also, notice in the Federal Register, July 25, 2003, Vol. 68, No. 143, at Pages 44011 - 44020. This is ET Docket No. 03-122. The FCC adopted this NPRM on May 15, 2003, and released June 4, 2003.
9/17. The Department of Commerce (DOC) and the Internet Corporation for Assigned Names and Numbers (ICANN) entered into a Memorandum of Understanding (MOU) that extends for three years the DOC's agreement with the ICANN. The current agreement was scheduled to expire on September 30, 2003.
9/15. The U.S. Court of Appeals (9thCir) issued its opinion [14 pages in PDF] in Albingia Versicherungs A.G. and Siemens Components Pte. Ltd. v. Schenker International, Inc., a case involving procedural issues regarding supplemental jurisdiction after removal to federal court and choice of law. The underlying dispute involves liability in a waybill for shipping computer chips made by Siemens, which were stolen. This case is Albingia Versicherungs A.G. and Siemens Components Pte. Ltd. v. Schenker International, Inc., No. 01-16558, an appeal from the U.S. District Court for the Northern District of California, Judge Marilyn Patel presiding, D.C. No. CV-99-02989-MHP.
9/18. The National Institute of Standards and Technology (NIST) Computer Security Division (CSD) released its "Pre-Publication Final" draft of its document [13 pages in PDF] titled "Standards for Security Categorization of Federal Information and Information Systems". The E-Government Act of 2002 (Public Law 107-347) tasked the NIST with preparing this set of standards to be used by federal agencies to categorize all information and information systems collected or maintained by or on behalf of each agency based on the objectives of providing appropriate levels of information security according to a range of risk levels. This is Federal Information Processing Standards (FIPS) Publication 199. This document states that public comments are welcome. However, it sets no deadlines.
9/17. The House Government Reform Committee's Subcommittee on Technology, Information Policy, Intergovernmental Relations and the Census held a hearing titled "Should the Common Criteria be Applied to ALL Government Software Purchases?" See, prepared testimony [PDF] of Edward Roback, Chief of the Computer Security Division (CSD) at the National Institute of Standards and Technology (NIST).
9/16. The Executive Office of the President's (OEP) Office of Science and Technology Policy's (OSTP) National Science and Technology Council's (NSTC) Committee on Science's Subcommittee on Research Business Models published a notice in the Federal Register announcing a series of public meetings around the U.S. regarding the policies, procedures, and plans relating to the business relationship between federal agencies and research performers. The subcommittee will meet on October 27 at the Lawrence Berkeley National Laboratory in Berkeley, California, on November 12 at the University of Minnesota in Minneapolis, Minnesota, on November 17 at the University of North Carolina in Chapel Hill, North Carolina, and on December 9-10 at the Department of Agriculture in Washington DC. The subcommittee requests public presentations at these meetings, and written comments. For more information contact Michael Holland at 202 456-6130. See, Federal Register, September 16, 2003, Vol. 68, No. 179, at Pages 54225 - 54226. The subcommittee also published a second notice in the Federal Register extending until October 6 its deadline to submitting written comments. See, original notice in the Federal Register, August 6, 2003, Vol. 68, No. 151, at Pages 46631 - 46632, and notice of extension in the Federal Register, September 16, 2003, Vol. 68, No. 179, at Pages 54226 - 54227.

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