In latest development in legal battle between Microsoft and Lindows.com, latter said Tues. it had filed motion for summary judgment. In May, Microsoft lost its appeal to block San Diego software company from calling itself Lindows.com and its Linux- based programs LindowsOS (CED May 20 p2). Microsoft’s original complaint charged Lindows with trademark infringement and unfair competition under Latham Act. Software giant argued that use of names Lindows.com and LindowsOS traded off goodwill of Windows trademark to distinguish its products from competing products. In 7-page decision in May, U.S. Dist. Court, Seattle, Judge John Coughenour said his March 15 ruling denying Microsoft request to shut down Lindows was appropriate despite Microsoft’s claims to contrary. Coughenour had said in March that “at most, Microsoft has raised serious questions about the validity of its trademark, but has fallen short” of showing Lindows.com should be prevented from using names as part of its business. In latest motion filed by Lindows, company contended that, since late 1970s, graphical user interfaces had been referred to as “windows programs,” “windowing interfaces,” “windowing systems,” “window managers.” Lindows said it had “investigated the matter further, taken depositions of current and former Microsoft employees, and gathered additional evidence to establish conclusively the terms’ generic usage during the critical 1980-1984 period.” Lindows said “for the purpose of this motion and for the remainder of the case, Microsoft is no longer entitled to the statutory presumption of validity [and] Microsoft now has the burden or proving that the Windows mark falls into a protectable category.” Microsoft comment was unavailable by our deadline. Separately, Lindows said it had signed deal with U.K. PC maker Evesham Technology to bundle LindowsOS on latter’s computer systems in Europe.

In 17 states, phone call to “211” can help troubled persons in need of social assistance find shortcut through bewildering maze of public- and private-sector health and human service agencies to reach ones that can offer assistance. Many other states are considering establishing 211 referral service. But valuable as that service has proved to be in places where it’s available, economic woes afflicting states, municipalities, businesses and charities may affect pace at which it spreads, observers said.

Lack of clear congressional intent bedeviled oral argument between RIAA and Verizon in U.S. Dist. Court, D.C., Fri. RIAA is seeking endorsement of subpoena that would require Verizon to disclose identity of customer accused of sharing copyrighted works on peer-to-peer (P2P) network, but each side told Judge John Bates case was far more significant than single user. Bates seemed to agree case was precedential for future ISP compliance with Digital Millennium Copyright Act (DMCA), which permits such identity-seeking subpoenas but not, as Verizon contests, when controversial content is held not on ISP’s server but on customer’s PC. Bates promised both sides he would reach decision “quickly,” but attorneys for both RIAA and Verizon told us decision could take some time (this court “isn’t particularly quick,” one attorney said), and we're told appeal by losing side is expected.

Canadian broadcasters said they were “generally pleased” with “balanced approach” in Canadian govt.’s recent report on copyright reform. But they questioned govt.’s emphasis on World Intellectual Property Organization (WIPO) compliance and its timing on key issues. Proposed changes in Canada’s copyright act were announced by Canadian Heritage and Industry Depts. Key issues to be addressed over next 2 years include: (1) ISP liability for transmitting and storing copyrighted material. (2) Exclusive right for copyright holders to make their contents available “on demand” over the Internet. (3) Legal protection for rights management information that might be embedded in digital works. (4) Sanctions against persons who use circumvention technologies to infringe on copyright. The CAB stressed the urgent need to reform the copyright process: “This issue has been raised by CAB which believes that reform would benefit all participants at the Board -- rights-holders and users alike.” Parliamentary committee has year to examine recommendations, hold public hearings and report back to Parliament.

Qwest’s conception of which of its contracts with CLECs have to be filed with state regulators is too limited, FCC said in order released Fri. Qwest, which has been strongly criticized for not putting some of its CLEC contracts on file with state regulators, asked FCC for guidance. Commission said states generally had authority to determine which ILEC- CLEC contracts were considered interconnection agreements and thus eligible for filing under Sec. 252 of Telecom Act. State commissions are best positioned “to decide on a case- by-case basis whether a particular agreement is required to be filed as an ‘interconnection agreement'” and if “competition-affecting inconsistences in state decisions arise, those could be brought to our attention,” FCC said. “Therefore we decline to establish an exhaustive, all- encompassing ‘interconnection agreement’ standard.” However, it said that as general rule: “We find that an agreement that creates an ongoing obligation pertaining to resale, number portability, dialing parity, access to rights-of-way, reciprocal compensation, interconnection, unbundled network elements or colocation is an interconnection agreement that must be filed pursuant to Sec. 252(a)(1).” Agency said it disagreed with Qwest “that the content of interconnection agreements should be limited to the schedule of itemized charges and associated descriptions of the services to which the charges apply.” Sec. 252(a)(1) can’t be given “the cramped reading that Qwest proposes,” FCC said. In addition, it said it wasn’t “persuaded by Qwest that dispute resolution and escalation provisions are per se outside the scope” of Sec. 252. On other questions, agency said: (1) It disagreed with Qwest that settlement agreements resolving disputes between ILECs and CLECs over billing or other matters weren’t interconnection agreements: “We find that a settlement agreement that contains an ongoing obligation relating to Sec. 251(b) or (c) must be filed… Merely inserting the term ’settlement agreement’ in a document does not excuse carriers of their filing obligation… or prevent a state commission from approving or rejecting the agreement.” FCC said it agreed with Qwest that “those settlement agreements that simply provide for ‘backward-looking consideration’ [such as] the settlement of a dispute in consideration for a cash payment or the cancellation of an unpaid bill need not be filed.” In other words, agency said, “settlement contracts that do not affect an incumbent LEC’s ongoing obligations relating to Sec. 251 need not be filed.” (2) It agreed with Qwest that forms used by CLECs to request service didn’t need to be filed for state commission approval. (3) It also agreed that “agreements with bankrupt competitors that are entered into at the direction of a bankruptcy court or trustee and do not otherwise change the terms and conditions of the underlying interconnection agreement” don’t have to be filed. FCC said it wasn’t aware of any carrier’s submitting such agreements to state commissions for approval. Directing carriers to do so could raise “difficult jurisdictional issues between the bankruptcy court and regulators.”

FCC will be ready to act in “late fall or early winter” on rulemaking to revise contribution methodology for Universal Service Fund (CD Oct 3 p5), new Wireline Bureau Chief William Maher told reporters Fri. in informal breakfast meeting. Maher said bureau was “moving well along” in putting together recommendations for Commission action on possible changes in current revenue-based contribution system. Bureau is looking at several proposals, 2 from industry groups suggesting move to connection-based approach, another from Federal-State Joint Board, Maher said. Bureau basically is “looking at differences between revenue-based and connection-based approaches,” he said. Maher said universal service was one of 2 first-priority proceedings under way at bureau, with other one being triennial review of unbundled network elements (UNEs). UNE review is topic of “intense ex parte sessions” with numerous groups and “we're looking to move very quickly” on issue, Maher said. Noting FCC Chmn. Powell’s recent comment that triennial review would be done in “few short months,” Maher said he couldn’t quantify timing any better than that. In response to reporter’s question, he said ILECs had raised issue of TELRIC pricing for UNE but “it would be very ambitious to do an overhaul of TELRIC pricing in this proceeding.” Maher said broadband access proceeding also remains “of highest importance” to agency although “public attention has not been as intense” lately. There are some common issues in broadband proceeding and triennial review and bureau is planning to bring both proceedings “to the Commission’s attention at about the same time frame,” Maher said. As bureau works on those issues, it’s also kept busy with pending Sec. 271 applications for 13 states, some of them combined into joint filings. Also considered important at bureau, although publicity has waned somewhat, are ILECs’ requests for tariff revisions to enable them to require security deposits, Maher said. He said “record is complete” on related Verizon request for rulemaking on “more generalized guidance on activities carriers can undertake to protect themselves against customer bankruptcies.” Pending proceeding on ILEC performance standards also is important, although agency is “trying to get the framework done first” through triennial review and broadband proceeding, he said. “Some good work has been provided by industry groups” on that issue, Maher said. Bureau chief told reporters his background in electrical engineering made him particularly interested in technology issues, especially those involving companies’ ability to innovate.

FCC conditionally approved license transfers involving combined 80% investment in XO Communications by buyout firm Forstmann Little and Telefonos de Mexico, rejecting challenge by RCN Corp. RCN urged Commission, at minimum, to condition its approval on Telmex not acquiring any interest in XO because of concerns it would use its market power in Mexico to harm competition in U.S. market. FCC’s International, Wireless and Wireline Bureaus turned down those arguments. Approval of proposed license transfers, with conditions, comes amid press reports that financiers Carl Icahn and Theodore Forstmann had been discussing how to end their battle for control of XO. Forstmann and Telmex signed deal last Jan. under which each would hold 40% noncontrolling stake in XO. XO sought declaratory ruling, telling FCC it wouldn’t further public interest to bar indirect foreign ownership of XO’s wireless licenses in excess of 25% foreign ownership benchmark by Telmex and Irish citizen Gordon Holmes, who is general partner in Forstmann. Sec. 310(b) of Communications Act lets foreign govt. hold greater than 25% stake in corporate license unless FCC finds public interest would be served by refusing to grant licenses. XO told FCC proposed investments by Telmex and Holmes were attributable to WTO members Mexico and Ireland, entitling XO to rebuttable presumption that such stakes didn’t raise competitive concerns. Commission said XO also could accept up to 25% additional indirect equity from those or other foreign investors under certain conditions without seeking approval again from FCC under Sec. 310(b). FCC said anticompetitive effects wouldn’t result from decision. Forstmann already holds 58% stake in McLeod USA, which operates in same markets as XO. FCC cited XO argument that even if Forstmann took controlling interest in XO, there were at least 4 other CLECs, in addition to ILEC, in states where XO and McLeod operated. To overcome “rebuttable presumption” that entry by carriers from WTO member countries was in public interest, deal involving foreign carrier had to be shown to pose “very high risk” to competition in U.S., FCC said, and RCN had not made such showing. RCN cited its difficulty in negotiating fair local interconnection agreements with Telmex, alleged inaction by Mexican regulators and poor service quality as signs of Telmex’s “ability to discriminate.” Commission said: “While we are concerned about these allegations, we disagree with RCN’s assertions that our dominant carrier safeguard and our enforcement authority would be ineffective to prevent any harm to U.S. competition that such alleged conduct might cause.” FCC concluded RCN hadn’t established link between alleged discriminatory conduct in Mexico and harm to competition in U.S. Conditions also incorporated electronic surveillance and other security safeguards in agreement reached between XO, Justice Dept., FBI. Point was to protect U.S. in ability to carry out authorized electronic surveillance, prevent and detect foreign-based espionage and protect U.S. infrastructure.

BOCA RATON, Fla. -- Proposal to use “bill-&-keep” system for intercarrier compensation could cause significant problems for rural carriers unless universal service was increased to cover shortfall in revenue, panelists said Wed., last day of USTA’s annual convention here. Idea of moving to bill & keep to replace access charges and other carrier compensation systems has been under study at FCC for at least 2 years. Commission has been looking at having one compensation system replace myriad of carrier-to-carrier payment plans, including access charges and reciprocal compensation. Carriers, especially Bells, support moving to bill & keep as that one payment system. As originally proposed in White Paper by FCC staffers, bill & keep would divide network into 2 parts, with caller’s phone company billing from caller to central point and call recipient’s network charging for completion of call. System is considered simpler than those used now.

Cingular Wireless told FCC this week it had suspended shipments of Enhanced 911 infrastructure equipment (E-OTD), technology whose readiness had been target of public safety concerns. Cingular said it was conducting field trial of alternative, network-based technology for GSM part of its network. E-OTD -- Enhanced Observed Time Difference of Arrival -- is hybrid handset network solution for locating wireless 911 callers. While public safety groups have questioned deployment track record of GSM carriers planning to use E-OTD for upcoming E911 deadlines, T-Mobile USA told FCC this week it was selling E-OTD capable handsets in its stores in R.I., St. Louis, Houston and Dallas, with plans to make it available soon on its Web site. T-Mobile, formerly VoiceStream Wireless, told FCC that results showed accuracy of E-OTD deployments was “very encouraging,” although it said some performance issues still needed to be addressed. “What you may have is 2 companies looking at uncertainty differently,” industry source said.

House Internet Caucus Co-Chmn. Boucher, as expected, introduced bill Thurs. to modify Digital Millennium Copyright Act (DMCA) and mandate labels on copy-protected CDs. Co-sponsored by Rep. Doolittle (R-Cal.), proposed Digital Media Consumers’ Rights Act (DMCRA) would amend DMCA in 2 respects: (1) It no longer would be illegal to circumvent copy-protection measures if user were engaged in fair use practices. (2) It no longer would be illegal to distribute circumvention technology if end user were seeking to practice fair use. DMCA has “dramatically tilted the copyright balance toward complete copyright protection at the expense of the fair use rights of the users of copyrighted material,” Boucher said at news conference. Bill also would require music companies to label copy-protected CDs and would call on Congress to study issue. “We are not proposing to outlaw the introduction of copy-protected CDs,” Doolittle said: “We, however, want to ensure that if copy-protected CDs are introduced in larger volumes, consumers will know what they are buying.” Boucher and Doolittle said they were aware their bill had no chance of passage this Congress, but they instead hoped to set agenda for debate beginning in Jan. Bill has been promised by Boucher for nearly year. Public Knowledge Pres. Gigi Sohn and Legal Dir. John Mitchell wrote Boucher Thurs. praising bill, particularly copy-protected CD and circumvention provisions. American Library Assn. sent urgent alert to its members to call Capitol Hill in support of bill, calling it “a necessary first step to recognizing the rights of copyright users.” But Business Software Alliance Pres. Robert Holleyman, who has been active in working with IT community in combating other bills deemed threatening to fair use, raised concerns with both Boucher bill and similar fair use bill introduced Wed. by Rep. Lofgren (D- Cal.). “The DMCA provides important tools in the fight against piracy,” he said: “We fear that broad exemptions to the DMCA could undermine the core purpose of the Act -- that technological measures can have an important and proper role in curbing piracy.” On Lofgren’s bill (HR-5522), Holleyman said carving out exemptions in DMCA for fair use might be positive goal, but probably was more likely instead to “make it harder for software companies to take action against pirates.” He said HR-5522 would allow pirates “in every instance [to] be able to claim that their ‘intent’ in defeating technological protection measures was upright even if it resulted in mass infringement.” His criticism of Boucher’s bill was similar on circumvention, although Holleyman did say that the provision on CD labeling for copy- protected CDs “deserves careful consideration.” He said software industry had long history of comprehensive labeling on compatibility and use and “we think this practice has served our customers well.”