Jimm Phillips

Leaks that began a year ago this month about controversial National Security Agency surveillance programs continue to damage U.S. relations with erstwhile and potential allies on Internet governance issues, but there are signs that damage can be and already is being repaired, experts said Wednesday at a Brookings Institution event. The U.S. has been trying to maintain and grow a coalition of national governments that back the existing multistakeholder Internet governance model, in the lead- up to upcoming international forums that will affect Internet governance. U.S. Coordinator for International Communications and Information Policy Daniel Sepulveda has acknowledged the NSA programs have affected his discussions with foreign governments on Internet governance issues (CD Nov 8 p5).

NSA Director Mike Rogers acknowledged Tuesday that the agency does use facial recognition as part of its surveillance programs. “We use facial recognition as a tool to help us understand these foreign intelligence targets,” he said during a Bloomberg Government cybersecurity event. The NSA doesn’t collect and analyze facial recognition data “on a unilateral basis against U.S. citizens,” but “in a digital age, we will encounter U.S. persons in the wilderness.” The New York Times reported Sunday that the NSA was using facial recognition technology to collect facial data from images transmitted through text messages, emails and other social media. That issue also came up at an NTIA meeting on a facial recognition code of conduct. (See separate report below in this issue.)

The Supreme Court ruled against Akamai Technologies Monday in its patent lawsuit versus Limelight Networks, saying a company can claim patent infringement against another entity only when that entity was involved in every step of the claimed infringement. The U.S. Court of Appeals for the Federal Circuit, which originally ruled on the case in 2012, “fundamentally misunderstands what it means to infringe a method patent,” Justice Samuel Alito wrote in the Supreme Court’s unanimous opinion (http://1.usa.gov/1hsV8ja). Oral argument was held in April (CD May 1 p16). The Federal Circuit had ruled Akamai and patent co-owner Massachusetts Institute of Technology could argue Limelight had committed “divided” or “inducing infringement” of its patents on content delivery methods by committing most steps in the infringement process and then inducing a third party -- its customers -- to take the final step in that process. The Federal Circuit’s “contrary view” would deprive U.S. law “of ascertainable standards and require the courts to develop two parallel bodies of infringement law,” the Supreme Court said. Limelight believes the Supreme Court’s ruling is a win for the entire country “by promoting clear rules governing liability for patent infringement,” a spokeswoman said. “We look forward to full resolution” of the case, she added. Akamai had no immediate comment. Supreme Court justices had spent much of oral argument debating whether a ruling on Akamai’s claim of “divided” or “inducing infringement” would have any lasting value since Akamai had the option to argue its case again before the Federal Circuit because that court hadn’t ruled on claims of direct infringement. The Supreme Court remanded the case back to the Federal Circuit, directing it to decide the direct infringement issue. Cisco, Facebook and Google were among the major tech companies backing Limelight’s case, arguing an Akamai win would open them up to more suits from patent assertion entities.

The U.S. wireless tower sector is likely to do very well over the next 12 months amid a confluence of telecom industry trends like increasing network expansions and network quality improvements, industry participants and observers told us. Those trends taken together are making the tower sector “as robust as it’s ever been,” said Clayton Funk, a managing director at broker Media Venture Partners. Wireless carrier consolidations -- such as a possible merger between Sprint and T-Mobile US -- will continue to be a top factor in the industry’s outlook, but not as large as in the past, observers said.

Network operators should avoid impairing or restricting VoIP applications “unless no reasonable alternatives are available to resolve technical issues,” said the Broadband Internet Technical Advisory Group’s (BITAG) Technical Working Group Thursday in a report. Some network management actions, such as port blocking or traffic limitations meant to impede hacking of vulnerable VoIP services, may limit or restrict VoIP traffic “as a method of ensuring network integrity,” BITAG said. VoIP impairments, failures and restrictions could potentially be construed as “anticompetitive, discriminatory or motivated by non-technical factors,” the group said. Network operators should ensure they take such actions in a way that will “minimize the impact of the approach on legitimate VoIP use,” BITAG said (http://bit.ly/SVotYb). BITAG, a non-profit formed to develop industry consensus on Internet rules, previously released a report in October on best practices to reduce network congestion (CD Oct 23 p10).

The removal of the Patent Transparency and Improvements Act (S-1720) from the Senate Judiciary Committee’s agenda virtually guarantees that comprehensive legislation to curb patent abuse will have to wait until the 114th Congress convenes in 2015, said industry stakeholders in interviews. Senate Judiciary Chairman Patrick Leahy, D-Vt., said Wednesday he was cutting S-1720 from the committee’s agenda because negotiations had still not produced a compromise on controversial provisions in the bill, prompting outcry from pro-revamp industry stakeholders (CD May 22 p11). Several stakeholders said they believe a patent revamp has a far better chance of passing Congress next year if Republicans take control of the Senate after the November elections.

The Senate Homeland Security Committee approved the Department of Homeland Security Cybersecurity Workforce Recruitment and Retention Act Wednesday. Introduced Tuesday by committee Chairman Tom Carper, D-Del. (http://1.usa.gov/1sVoqq6), S-2354 would give the DHS secretary authority that to hire cybersecurity professionals with the same speed and set salary pay scales at the same levels allowed in the Department of Defense and NSA. Larry Zelvin, director of the DHS National Cybersecurity & Communications Integration Center (NCCIC), said at a separate House Homeland Security Committee hearing that DHS needs additional clarification on its legal role in cybersecurity matters to better implement some of its programs.

Senate Judiciary Committee Chairman Patrick Leahy, D-Vt., removed the Patent Transparency and Improvements Act (S-1720) from the committee’s agenda Wednesday, which one industry executive told us seriously endangers the prospects for passing a patent revamp bill before the end of the current Congress. Senate Judiciary subsequently canceled a planned committee business meeting set for Thursday morning, at which an S-1720 markup had been the only planned agenda item. “There has been no agreement” after weeks of negotiations on a compromise manager’s amendment meant to address several controversial provisions sought in a final version of S-1720, Leahy said in a statement. “I have said all along that we needed broad bipartisan support to get a bill through the Senate,” he said. “Regrettably, competing companies on both sides of this issue refused to come to agreement on how to achieve that goal.” If stakeholders can craft a “more targeted agreement that focuses on the problem of patent trolls, there will be a path for passage this year and I will bring it immediately to the Committee,” Leahy said. The industry executive and a pro-revamp lobbyist had told us in separate interviews before Leahy’s announcement that there had been some movement in negotiations that signaled an increased likelihood of an S-1720 markup at the Thursday meeting. Pro-revamp industry groups expressed disappointment in Leahy’s decision, particularly given the House’s passage in December of the Innovation Act (HR-3309), which contained many of the provisions included in S-1720. CEA believes Leahy’s decision “makes this a day of celebration for patent trolls,” said CEA President Gary Shapiro in a statement. “We are profoundly disappointed the Senate has abdicated its responsibility to address the skyrocketing costs of patent abuse.” The bill’s removal is “a massive setback to the nationwide chorus of calls for reform after patent trolls expanded their targets in recent years to companies across a wide range of industries,” the Computer and Communications Industry Association said. Senate Majority Leader Harry Reid, D-Nev., should “stand with innovators and bring the House-passed Innovation Act to the floor of the Senate for an up or down vote,” said Internet Association President Michael Beckerman in a statement. ACT/The App Association believes “it is regrettable that the inability of Congress to advance widely supported legislation will expose many small companies to predatory litigation,” said President Jonathan Zuck in a statement. Engine Advocacy said it’s “hopeful that the Chairman means what he says and that he will work to pass much-needed legislation this year.” Charles Duan, Public Knowledge’s director-Patent Reform Project, said other House and Senate bills specifically target pre-litigation patent demand letter abuses, but those “cannot replace the comprehensive reform legislation that has now been withdrawn.” Leahy’s decision “shows pretty clearly that addressing these issues is more complicated than many may have thought,” said American Intellectual Property Law Association (AIPLA) President Todd Dickinson in a statement. AIPLA and Dickinson, former head of the Patent and Trademark Office, had been critical of some aspects of current patent revamp legislation. “More time and broader constituent input may make for even better legislation,” Dickinson said.

The House Oversight Committee will view any federal agency that doesn’t begin requiring all cloud service providers (CSPs) to abide by the Federal Risk and Authorization Management Program (FedRAMP) as an “ineligible player in the bidding process,” once a sufficient pool of vendors is FedRAMP compliant, said committee Chairman Darrell Issa, R-Calif., Tuesday.

AT&T’s proposed deal to buy DirecTV may be a signal the telco is prioritizing its domestic business over expanding its international presence, industry analysts told us Monday. AT&T is selling off its remaining stake in Latin American wireless carrier América Móvil for $6 billion to ease some of the regulatory hurdles for the DirecTV deal. The DirecTV deal (see separate reports in this issue), announced Sunday (CD Bulletin May 19), essentially puts to rest speculation about AT&T’s true level of interest in Vodafone, analysts said.