Source: http://www.techlawjournal.com/alert/2005/10/28.asp
Timestamp: 2017-09-23 16:32:38
Document Index: 589480221

Matched Legal Cases: ['§ 7', '§ 18', '§ 18', '§ 7', '§ 18', '§ 18']

TLJ Daily E-Mail Alert No. 1,242, October 28, 2005.
October 28, 2005, 9:00 AM ET, Alert No. 1,242.
DOJ Approves Verizon MCI and SBC AT&T Mergers Subject to Divestitures
10/27. The Department of Justice's (DOJ) Antitrust Division approved the two mergers of Verizon and MCI WorldCom and SBC and AT&T, subject to divestiture of some local fiber optic network facilities. See, DOJ release.
Thomas Barnett, the acting Assistant Attorney General in charge of the Antitrust Division, stated in the DOJ release that "Today's action by the Department ensures that business customers that provide or buy telecommunications services to locations in Verizon's and SBC's territories will continue to benefit from competition".
Barnett (at left) continued that "The Division thoroughly investigated not just the local private line issues covered by today's settlement but all areas in which the merging firms compete, including residential local and long distance service, Internet backbone services and a variety of telecommunications services provided to business customers. With the exception of the cities covered by today's action, in which the merging firms control the only wireline access to numerous buildings, the Division concluded that the transactions will not harm competition and will likely benefit consumers, due to existing competition, emerging technologies, the changing regulatory environment, and exceptionally large merger-specific efficiencies."
To put into effect these divestitures, the DOJ filed two civil complaints in U.S. District Court against the merging companies. The complaints plead violation of federal antitrust law, and seek to block the mergers. However, the DOJ and the merging companies simultaneously filed proposed settlements that allow the mergers to proceed, subject to divestitures.
These mergers are also subject to redundant merger reviews by the Federal Communications Commission (FCC). The FCC is scheduled to hold a meeting on Friday, October 28, 2005, at which it will consider two orders pertaining to these mergers. See, FCC agenda [PDF].
Verizon and MCI WorldCom stated in a release that "Final closure of the transaction, which the companies anticipate will occur later this year or early in 2006, is subject to approval by the Federal Communications Commission. International approvals are already complete, as are the majority of necessary state-level regulatory reviews."
SBC stated in a release that "approvals have been received from 33 of 36 states with clearance processes and from the District of Columbia. Reviews are pending with the Federal Communications Commission and in Arizona, California and Ohio. The companies expect that the approval process will be completed this fall and that the merger will close later this year."
DOJ Initiates Clayton Act § 7 Proceeding Against SBC and AT&T
10/27. The Department of Justice's (DOJ) Antitrust Division filed a complaint [12 pages in PDF] in U.S. District Court (DC) against SBC and AT&T alleging violation of Section 7 of the Clayton Act, which is codified at 15 U.S.C. § 18.
The complaint states that "For hundreds of commercial buildings in the metropolitan areas of Chicago, Illinois; Dallas-Fort Worth, Texas; Detroit, Michigan; Hartford-New Haven, Connecticut; Indianapolis, Indiana; Kansas City, Missouri; Los Angeles, California; Milwaukee, Wisconsin; San Diego, California; San Francisco-San Jose, California; and St. Louis, Missouri, SBC and AT&T are the only two firms that own or control a direct wireline connection to the building. These building connections are used to supply voice and data telecommunications services to business customers."
The complaint alleges that "The effect of the proposed acquisition of AT&T and SBC would be to lessen competition substantially in interstate trade and commerce in numerous geographic markets for (a) Local Private Lines and (b) voice and data telecommunications services that rely on Local Private Lines, in violation of Section 7 of the Clayton Act, 15 U.S.C. § 18."
The complaint requests a declaration of violation of Section 7 of the Clayton Act, and an injunction.
However, DOJ, SBC and AT&T simultaneously filed with the District Court a Stipulation [7 pages in PDF] and proposed Final Judgment [26 pages in PDF] that provide for District Court approval of the merger with divestitures.
See also, DOJ's explanation [2 pages in PDF] of consent decree procedure. This settlement is subject to the requirements of the Tunney Act. This proposed settlement and the DOJ's competitive impact statement will be published in the Federal Register, and any person will be allowed 60 days to submit comments before final Court approval.
SBC stated in a release that "SBC and AT&T have agreed to provide access to certain buildings in SBC's operating territory where AT&T has fiber and the two companies are the only providers with facilities serving those buildings. The Department of Justice found no other competitive concerns that would warrant seeking to preclude the merger from being completed."
This case is U.S.A. v. SBC Communications, Inc. and AT&T Corp., U.S. District Court for the District of Columbia, D.C. No. 1:05CV02102, Judge Emmet Sullivan presiding.
SBC also announced in a release that "it will adopt AT&T, Inc. as its name following completion of its acquisition of AT&T".
DOJ Initiates Clayton Act § 7 Proceeding Against Verizon and MCI
10/27. The Department of Justice's (DOJ) Antitrust Division filed a complaint [12 pages in PDF] in U.S. District Court (DC) against Verizon and MCI WorldCom alleging violation of Section 7 of the Clayton Act, which is codified at 15 U.S.C. § 18.
This complaint mirrors the complaint against SBC and AT&T. It states that "For hundreds of commercial buildings in the metropolitan areas of Washington, D.C.; Boston, Massachusetts; New York, New York; Richmond, Virginia; Providence, Rhode Island; Tampa, Florida; Philadelphia, Pennsylvania; and Portland, Maine, Verizon and MCI are the only two firms that own or control a direct wireline connection to the building. These building connections are used to supply voice and data telecommunications services to business customers."
The complaint alleges that the proposed merger would lessen competition in these geographic markets for Local Private Lines and voice and data telecommunications services that rely on Local Private Lines, in violation of Section 7 of the Clayton Act, 15 U.S.C. § 18. It requests a declaration of violation of Section 7 of the Clayton Act, and an injunction.
Also, the DOJ, Verizon and MCI simultaneously filed with the District Court a Stipulation [6 pages in PDF] and proposed Final Judgment [PDF] that provide for divestiture in the listed markets of local fiber optic network facilities.
This case is U.S.A. v. Verizon Communications, Inc. and AT&T Corp., U.S. District Court for the District of Columbia, D.C. No. 1:05CV02103, Judge Henry Kennedy presiding.
Copyright Office Publishes Interim Regulations for Preregistration of Unpublished Works
10/27. The Copyright Office (CO) published a notice in the Federal Register that describes, recites, and sets the effective date (November 15, 2005) of interim regulations promulgated pursuant to the Artists' Rights and Theft Prevention Act of 2005 (ART Act) governing the preregistration of unpublished works that are being prepared for commercial distribution in classes of works that the Register of Copyrights has determined have had a history of pre-release infringement.
The ART Act is Title I of the Family Entertainment and Copyright Act (FECA). The FECA was S 167. It is now Public Law No. 109-9.
The ART Act contains several provisions. One requires the Register of Copyrights to "establish procedures for preregistration of a work that is being prepared for commercial distribution and has not been published ... for any work that is in a class of works that the Register determines has had a history of infringement prior to authorized commercial distribution". It also provides that infringement actions may be based upon these preregistrations.
During Congressional consideration, members were clear about the purpose of these new preregistration provisions. Registration of copyright with the CO is a prerequisite for a suit for infringement of United States works and a prerequisite for awards of attorney's fees and statutory damages. Yet, pirates often obtain, copy, and disseminate works before they are reduced to final form and released to the public. These acts can cause significant commercial harm. These acts occur before the copyright holder has obtained a certificate of registration from the CO.
However, the Congress left it to the CO to identify precisely which classes of works are to be covered.
See also, story titled "House Approves Copyright Bill" in TLJ Daily E-Mail Alert No. 1,119, April 20, 2005, and story titled "Copyright Office Commences Rulemaking on Preregistration of Unpublished Works" in TLJ Daily E-Mail Alert No. 1,181, July 25, 2005.
The notice states that "The Register has now carefully reviewed the record in this rulemaking proceeding to determine the classes of works that have had a history of infringement prior to authorized commercial distribution. Based on that review of the comments, it appears that the case has been made for eligibility for preregistration of the following classes of works upon their fulfillment of the conditions specified in 37 CFR 202.16:
(iv) Literary works being prepared for publication in book form;
(v) Computer programs (including videogames); and
(vi) Advertising or marketing photographs."
Also, "Any class of work that the Register determines has had a history of pre-release infringement may be preregistered without regard to whether the work is intended to be distributed in physical formats or is intended for
online distribution."
The notice also states that the CO's "online preregistration system, which is in its final stages of preparation, will go online, and preregistration will be available, on November 15."
The notice also states that over the objection of some commenters, the CO has determined that "the preregistration record will be a public record, and information from the preregistration records will be available on the Copyright Office Web site".
See, Federal Register, October 27, 2005, Vol. 70, No. 207, at Pages 61905 - 61908.
10/27. President Bush withdrew the nomination of Harriet Miers to be an Associate Justice of the Supreme Court. He added that "she will continue to serve our Nation as White House Counsel".
Bush praised her "extraordinary legal experience, her character, and her conservative judicial philosophy". He continued, "I understand and share her concern, however, about the current state of the Supreme Court confirmation process. It is clear that Senators would not be satisfied until they gained access to internal documents concerning advice provided during her tenure at the White House -- disclosures that would undermine a President's ability to receive candid counsel. Harriet Miers' decision demonstrates her deep respect for this essential aspect of the Constitutional separation of powers -- and confirms my deep respect and admiration for her." See, Bush's statement.
Sen. Arlen Specter (R-PA), the Chairman of the Senate Judiciary Committee (SJC), stated that "I respect Ms. Harriet Miers’ decision to withdraw from consideration for the Supreme Court. At the same time, I do regret that our constitutional process was not completed. Instead of a hearing before the Judiciary Committee and a debate on the Senate floor, Ms. Miers’ qualifications were subjected to a one-sided debate in news releases, press conferences, radio and TV talk shows, and the editorial pages. I acknowledge the rights of everyone to express themselves as they see fit. But that should not have precluded Ms. Miers from getting basic due process."
Sen. Patrick Leahy (D-VT), the ranking Democrat on the SJC, stated that "I look forward to consulting with the President on his third nominee to succeed Sandra Day O’Connor on the Supreme Court, and I hope it is a decision he approaches with the necessary independence from partisan factions." See, statement.
Bush Makes Appointments to Foreign Intelligence Advisory Board
10/27. President Bush announced his intent to appoint eleven persons to be members of the President's Foreign Intelligence Advisory Board (PFIAB), for a term of two years: James Barksdale, Arthur Culvahouse, William DeWitt, James Ellis, Donald Evans, Martin Faga, Lee Hamilton, Ray Hunt, David Jeremiah, John Morrison, and Elizabeth Cornell. Several of these appointees are associated with information technology related entities.
James Barksdale is a Director of Time Warner, FedEx, and Sun Microsystems. He is also a member of the Board of Trustees of In-Q-Tel. He is also General Partner of Barksdale Group, a venture capital firm. He was P/CEO of Netscape until its acquisition by AOL.
Arthur Culvahouse is a partner in the Washington DC office of the law firm of O'Melveny & Myers. He was President Reagan's last White House Counsel, the position now held by Harriet Miers. Before that he was a long time assistant to former Sen. Howard Baker (R-TN).
William DeWitt is Managing Partner and Chairman of the St. Louis Cardinals, and a long time friend and financial supporter of Bush.
James Ellis is a recently retired Navy Admiral who was Commander in Chief of the U.S. Strategic Command.
Donald Evans was Bush's first Secretary of Commerce.
Martin Faga is P/CEO and a member of the Board of Trustees of MITRE Corporation.
Lee Hamilton is a former Congressman from the state of Indiana.
Ray Hunt is an oilman from Dallas, Texas. He is CEO of Hunt Oil Company and Ch/CEO/P of Hunt Consolidated, Inc. He is also a Director of Halliburton Company and Electronic Data Systems Corporation.
David Jeremiah is a former Navy Admiral and Vice Chairman of the Joint Chiefs of Staff who is now Partner and President of Technology Strategies & Alliances Corporation, a advisory and investment banking firm that focuses on aerospace, defense, telecommunications, and electronics. He is also a member of the Board of Trustees of In-Q-Tel.
John Morrison is Managing Director of Goldner Hawn Johnson and Morrison, Inc., a private investment company. He is also a Director of the Overseas Private Investment Corporation (OPIC). And, he attended Yale at the same time as Bush.
Elizabeth Cornell is a professor of engineering at Stanford University.
Bush also announced his intent to appoint Stefanie Osburn to be Executive Director of the PFIAB. She is Chief of Staff for the Deputy Director of National Intelligence for Management at the Central Intelligence Agency (CIA). She has worked for the CIA for over 20 years.
10/27. The House approved HR 420, the "Lawsuit Abuse Reduction Act of 2005", by a vote of 228-184. See, Roll Call No. 553. This bill that addresses FRCP Rule 11 violations, and forum shopping. The vote broke down along party lines, with all but five Republicans voting for the bill, and all but 16 Democrats opposing the bill.
10/26. Federal Communications Commission (FCC) published a notice in the Federal Register that describes and sets comments deadlines for its notice of proposed rulemaking (NPRM) regarding the specific relocation procedures applicable to Broadband Radio Service (BRS) operations in the 2150-2160/62 MHz band, which the FCC previously decided will be relocated to the newly restructured 2495-2690 MHz band. The FCC also seeks comment on the specific relocation procedures applicable to Fixed Microwave Service (FS) operations in the 2160-2175 MHz band. Initial comments are due by November 25, 2005. Reply comments are due by December 12, 2005. This NPRM is FCC 05-172 in ET Docket No. 00-258. See, Federal Register, October 26, 2005, Vol. 70, No. 206, at Pages 61752 - 61762.
FCC Releases Agenda for November 3 Meeting
10/27. The Federal Communications Commission (FCC) released the agenda [PDF] for its event titled "Open Meeting" on Thursday, November 3, 2005. There are currently three items on the agenda.
Section 621 and New Video Entrants. The agenda states that the FCC will consider a Notice of Proposed Rulemaking (NPRM) regarding Section 621(a)(1)'s directive that local franchising authorities not unreasonably refuse to award competitive cable franchises. The agenda reveals nothing further.
FCC Chairman Kevin Martin gave a speech [4 pages in PDF], remotely, to the U.S. Telecom Association (USTA) meeting in Las Vegas, Nevada, on October 26. He said that "Section 621 of the statute prohibits local authorities from granting exclusive franchises and from unreasonably refusing to award a second franchise."
Martin (at right) also stated that "I recently presented my colleagues with a Notice of Proposed Rulemaking that asks how the local franchising process is working and what actions, if any, the Commission should take to fulfill Congress's directive that franchising authorities not grant exclusive franchises or unreasonably refuse to award additional competitive franchises. I plan on the Commission considering this item at our November meeting which is just a few days away."
Martin did not disclose the contents of this NPRM. However, he did say that "I believe that new video entrants, regardless of the technology employed, should be encouraged -- not impeded from entry."
There are also legislative proposals to amend Section 621. See, for example, HR 3146, the "Video Choice Act of 2005", sponsored by Rep. Marsha Blackburn (R-TN), and the related bill in the Senate, S 1349, the "Video Choice Act of 2005 ", sponsored by Sen. Gordon Smith (R-OR). See also, HR 2726, the "Preserving Innovation in Telecom Act of 2005", sponsored by Rep. Pete Sessions (R-TX).
DTV Tuners. The agenda also states that the FCC will consider a Second Report and Order concerning its requirements for new television receivers to include the capability to receive digital television signals.
On June 9, 2005, the FCC adopted and released a Report and Order and Further Notice of Proposed Rule Making [25 pages in PDF]. The FNPRM portion proposed to advance the date for receivers with screen sizes of 13-25 inches, and other devices that receive television signals, including VCRs and DVD players and recorders, from July 1, 2007 to December 31, 2006. The FNPRM also sought comment on whether the requirement to include a DTV tuner in new receivers should be extended to receivers with screen sizes less than 13 inches.
See, story titled "FCC Adopts Order and NPRM Regarding Its Digital Tuner Rules" in TLJ Daily E-Mail Alert No. 1,153, June 14, 2005. This R&O and FNPRM is FCC 05-121 in ET Docket No. 05-24.
DTS Technologies. Finally, the agenda states that the FCC will consider a "Clarification Order and Notice of Proposed Rulemaking" to clarify the interim policy and propose rules for the use of distributed transmission system (DTS) technologies by digital television stations.
This event is scheduled for 9:30 AM on Thursday, November 3, 2005 in the FCC's Commission Meeting Room, Room TW-C305, 445 12th Street, SW. The event will be webcast by the FCC. The FCC does not always take up all of the items on its agenda. The FCC does not always start its monthly meetings at the scheduled time. The FCC usually does not release at its meetings copies of the items that its adopts at its meetings.
Highlights of AIPLA Annual Meeting (Friday, October 28)
8:45 AM - 11:45 PM. There will be a panel titled "How Companies Can Control Costs While Protecting and Enforcing IP".
8:45 AM - 11:45 PM. There will be a panel titled "International Litigation How To".
8:45 AM - 11:45 PM. There will be a panel titled "Making Good Use of ``Use In Commerce´´".
12:15 - 1:45 PM. Luncheon. The speaker will be Paul Michel, Chief Judge of the U.S. Court of Appeals for the Federal Circuit.
2:00 - 3:30 PM. There will be a panel titled "The Internet as a Vehicle for Entertainment: Law, Policy and Reality".
2:00 - 3:30 PM. There will be a panel titled "What Effect Will the Proposed New Interim PTO Guidelines Have on Section 101 Determinations of Patentable Subject Matter?".
2:00 - 3:30 PM. There will be a panel titled "Effective Amicus Participation".
10:00 AM. The House Judiciary Committee's (HJC) Subcommittee on Commercial and Administrative Law will hold an oversight hearing titled "Administrative Law, Process and Procedure Project". The hearing will be webcast by the HJC. Press contact: Jeff Lungren or Terry Shawn at 202 225-2492. Location: Room 2141, Rayburn Building.
4:00 PM. The House Ways and Means Committee's Subcommittee on Social Security will hold a hearing on Social Security Number (SSN) high risk issues. See, notice. For more information, call 202 225-9263. Location: Room B-318, Rayburn Building.
12:00 NOON. The House Homeland Security Committee's (HHSC) Subcommittee on Economic Security, Infrastructure Protection, and Cybersecurity will hold a hearing titled "The Future of TSA’s Registered Traveler Program". Location: Room 311, Cannon Building.
2:00 PM. House Judiciary Committee's (HJC) Subcommittee on Courts, the Internet, and Intellectual Property will hold a hearing titled "Content Protection in the Digital Age: The Broadcast Flag, High-Definition Radio, and the Analog Hole". The hearing will be webcast by the HJC. Press contact: Jeff Lungren or Terry Shawn at 202 225-2492. Location: Room 2141, Rayburn Building.