Adam Bender

The U.S. Supreme Court ruled 8-1 Thursday to strengthen Private Securities Litigation Reform Act curbs on “nuisance filings” by investors, in a case involving Tellabs. The 7th U.S. Circuit Court of Appeals used an “erroneously low standard” to decide if investors filing a 2002 class action against Tellabs satisfied a PSLRA standard requiring that “strong inference” existed to suggest Tellabs and then-CEO Richard Notebaert knowingly defrauded shareholders, Justice Samuel Alito said in a concurring opinion. Such a “strong inference” for knowing fraud (known as scienter) must be “cogent and at least as compelling as any opposing inference one could draw from facts alleged,” Supreme Justice Ruth Bader Ginsburg wrote for the U.S. Supreme Court, which vacated and remanded the 7th Circuit decision in Tellabs v. Makor.

Subpoenas will be issued for surveillance documents related to wiretapping and electronic surveillance, a Senate Judiciary Committee vote determined Thursday. The committee voted 13-3 to authorize Chairman Patrick Leahy, D-Vt., in consultation with ranking member Arlen Specter, R-Pa., to issue subpoenas to Attorney General Alberto Gonzales and the executive office records custodian for “all documents related to the Committee’s investigation into the Administration’s operation of a warrantless domestic surveillance program outside of the provisions of the Foreign Intelligence Surveillance Act, and its legal analysis for this program.” Republicans Specter and Sens. Orrin Hatch, R-Utah, and Charles Grassley, R-Iowa, supported the authorization, along with all Democratic committee members.

Congress should not amend the Foreign Intelligence Surveillance Act (FISA) until it subpoenas NSA warrantless wiretapping documents and related testimonies, Center of Democracy and Technology (CDT) policy director Jim Dempsey said Wednesday. It is “fundamentally premature” to amend FISA at this time, he said. CDT is “not satisfied with the level of disclosure the government has made,” said CDT Senior Counsel and Associate Director Gregory Nojeim: “It’s important they explain exactly what they've been doing.” Otherwise, it’s “hard to know if the statute ought to be changed and how,” he said.

NASCAR’s counterclaim against AT&T for $100 million in damages is “without merit,” an AT&T spokesman said: “We will deal with it accordingly.” NASCAR and AT&T are fighting over whether switching the logos on Richard Childress Racing’s (RCR) No. 31 car from Cingular to AT&T violates NASCAR’s exclusivity contract with Nextel for the Nextel Cup Series. AT&T and RCR signed a three-year contract extension Monday to keep the AT&T brand on the car (CD June 19 p9), which is driven by Jeff Burton.

AT&T invited the Electronic Frontier Foundation into its talks on developing a network copyright filter, Senior Intellectual Property attorney Fred von Lohmann told us. “We look forward to it,” he said. Last week, von Lohmann said AT&T should invite consumer advocates into talks to avoid criticism that the planned filter is an “unfortunate example of the way companies who need access to Hollywood content serve Hollywood needs before customers” (CD June 18 p4). AT&T sent von Lohmann a note Friday inviting him to open a dialogue, he said.

AT&T’s planned copyright network filter is raising telco interest and consumer group concern. The technology -- now at the “vaporware” stage, in one onlooker’s words -- aims to balance the need of Viacom and other Hollywood companies to protect copyrighted data with consumers’ right to access legitimate material, AT&T spokesman Claudia Jones said (CD June 14 p14). But EFF Senior Intellectual Property attorney Fred von Lohmann told Communications Daily he doubts such a “silver bullet” technology can be cast: “AT&T wants consumers to just trust them and Hollywood. But why should they?”

U.S. policy has “stifled” broadband and wireless build out, said Thomas Hazlett, Manhattan Institute senior fellow and former FCC chief economist, at the WCA Conference Fri. The U.S. needs to allocate more spectrum if it wants a wireless market on par with other countries’, he said. Much spectrum could be shifted from the analog TV band and elsewhere, he said: “It could be efficiently reallocated instead of dribbling out through rulemaking and 20-year transitions, micromanaged from Washington.” The FCC’s allowing spectrum to lie fallow is the real problem, said former NTIA Dir. Gregory Rohde. The FCC has no policy to push spectrum buyers to actually use that spectrum, he said. “We could allocate more, but we don’t ask about if it’s going to be used,” he said: “If a [spectrum buyer] refuses to use it, the FCC should give it to someone who will.” Hazlett agreed fallow spectrum is a problem, but he said he fears that an assertive FCC policy would increase govt. micromanagement. If more spectrum were allocated to begin with, the competitive market would prevent spectrum from lying fallow, he said.

The U.S. and Canada will push for an expansive and tech- neutral International Mobile Telecom (IMT) policy at the 2007 World Radiocommunication Conference (WRC) in Geneva, U.S. Ambassador Richard Russell and Canadian Dir. Gen.-Spectrum Engineering Robert McCaughern said Fri. at the WCA Conference. The U.S. wants a single IMT policy incorporating WiMAX, said Russell. Other U.S. priorities include space and terrestrial spectrum sharing, passive and active spectrum service coexistence, aeronautical spectrum needs and HF spectrum allocation, Russell said. Canadian objectives are similar, McCaughern said, citing satellite regulatory procedures and allotment, aeronautical frequency band identification, terrestrial and science service protection, and efficient HF spectrum usage. Canada has concerns about this year’s WRC structure, McCaughern said, noting that some agenda items have yet to be assigned to WRC’s 3 main committees, and that a WRC chair hasn’t been appointed.

Clearwire, DirecTV and EchoStar now can offer “triple play” bundles of voice, video and Internet thanks to 2 distribution agreements revealed Thurs., Clearwire said. DirecTV and EchoStar each signed agreements with Clearwire to sell the ISP’s wireless broadband, Clearwire said. Under the agreement, Clearwire also should be able to sell the satellite companies’ video services. But it’s unclear which satellite service Clearwire will offer customers -- if not both. Unlike major telcos, Clearwire likely will sell its “triple play” components unbundled, Clearwire spokeswoman Helen Chung told Communications Daily. Clearwire did not give the agreements’ terms. The pacts do not mark “a complete solution” for the satellite companies, given Clearwire’s limited coverage, Pali Research’s Walter Piecyk said. But if Clearwire succeeds at rolling out its network everywhere it has spectrum, “it would offer a differentiated service to cable operators based on its mobility and it could remain as a potential acquisition candidate,” he said. DirecTV previously has flopped at adding broadband to its service, trying a satellite broadband service and signing agreements with telcos, Piecyk said: “Broadband over satellite is plagued with latency and speed issues and the telephone companies are in the process of building fiber networks that would enable their own triple play service.” The ability of DirecTV and ClearWire to offer a wireless bundle to compete against cable and telcos will also benefit infrastructure contractor MasTec, ThinkEquity Partners said. DirecTV is MasTec’s largest customer, it said.

Cisco and IBM will collaborate on telecom software that cuts implementation and maintenance costs, the companies said Thurs. Cisco will add IBM technology to its service provider product portfolio; IBM Tivoli software will integrate with Cisco Active Network Abstraction (ANA), they said. Cisco Assurance Management Solution, combining ANA tech with Tivoli software, ships next month, they said. Managing different network elements in the same system can be a major challenge, even when made by the same company, IBM Tivoli Software CTO Alan Ganek told us. The new IBM/Cisco technology aims to simplify management of such IP-based services by offering a “more uniform structure,” he said. Ganek didn’t disclose financial terms.