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August 16, 2002
Executive Summary
Week Of August 12, 2002
by K. Daniel Glover
Privacy
Privacy Advocates Decry New Medical Privacy Rules
Privacy and patient advocacy groups this week criticized the Bush administration's final rules on medical privacy, arguing that the regulations will gut all individual patient protections. Privacy groups identify two significant losses in the rules -- eliminating patients' rights to consent to the use of their medical records and opening medical records to certain marketing by drug companies. "This is probably the most significant development in health care in my lifetime, and it is a negative one," said Jim Pyles, an attorney representing the American Psychoanalytic Association. "This will really lead to black market medicine." Massachusetts Democrat Edward Kennedy, chairman of the Senate Health, Education, Labor and Pensions Committee, said through a spokesman that he would look for a legislative vehicle in September to amend the rules.
Security
Sen. Carper Fights For Technology Funds To Secure Amtrak
As the Senate prepares to consider a wide range of transportation provisions during next month's floor debate of its sweeping homeland security bill, some lawmakers are warning that potential vulnerabilities in the nation's rail system have been largely overshadowed by Congress' mad dash to bolster aviation security. "Our lack of rail security precautions is an Achilles heel in our nation's efforts to secure our transportation system," Sen. Tom Carper, D-Del., said recently. "It would be nice to believe that our rail system will never be a target for terrorists, but this is naïve." The Senate's homeland security bill, S. 2452, includes a Carper-authored amendment that would provide Amtrak with $1.2 billion for rail security improvements. About $375 million of that would be earmarked for grants to subsidize high-tech security enhancements, such as explosive-detection equipment and communications upgrades for Amtrak police and crews.
White House
Bush Highlights Broadband As Part Of Economic Growth
President Bush underscored the importance of expanding high-speed Internet services to ensure continued growth in the economy. At his economic forum in Waco, Texas, Bush also encouraged federal, state and local governments to remove regulatory obstacles to the rollout of broadband -- an action that many high-tech industry members have sought. He added that he would oppose "new access taxes on broadband technology. ... The private sector will deploy broadband, but government at all levels should remove hurdles that slow the pace of deployment," Bush said. The president also used the forum to tout familiar priorities, offering no new initiatives to bolster the uncertain economy but promising generally to "move forward" on advice given by participants in the event.
Business
SEC Chief Reprimands Accounting Industry For Failings
Securities and Exchange Commission (SEC) Chairman Harvey Pitt said the recent accounting scandals have demonstrated that the profession has not satisfied its responsibilities to the public. Addressing the American Bar Association convention in Washington, Pitt said attorneys should learn from these failures. "Lawyers for public companies represent the company as a whole and its shareholder-owners, not the managers who hire and fire them," Pitt said. "Being ever mindful of this answer can help protect lawyers from the fate visited upon the accounting profession." Pitt, a former corporate attorney under fire for what some in Congress consider his close ties to the accounting profession, articulated a vision of securities regulation in which Congress should set broad standards, the SEC should flesh them out, and professional bodies should establish guidelines for ethical conduct.
Telecom
FCC Adds Questions To The 'Broadcast Flag' Debate
The FCC issued a series of written questions last week about a proposal to regulate digital television receivers as a means of preventing piracy -- without ever officially endorsing the "broadcast flag" proposal. The agency, which had voted 4-0 to issue a "notice of proposed rulemaking" on the issue, had been asked to take action on the Hollywood-sought broadcast flag by the heads of the Senate Commerce and House Energy and Commerce committees. The broadcast flag would require all digital TV receivers to include copyright-control technology. But the notice of rulemaking fails to suggest any regulation. By issuing a proposed rule instead of "notice of inquiry" -- a more preliminary stage of FCC operations -- the agency was taking a step that "makes it look like [they] are further along in the process" than they really are, said FCC observer Gigi Sohn, president of Public Knowledge.
White House
Assistant Attorney General Outlines Antitrust Priorities
Joint ventures -- including Internet services involving the recording industry and the Web site Orbitz -- are a high priority for the Justice Department's antitrust division, Assistant Attorney General Charles James said at the annual meeting of the American Bar Association's antitrust section. James said the nation's economic slowdown caused merger applications to drop dramatically, leading the division to focus more resources on examining joint ventures. "When you can no longer pay for someone else's overpriced stock with another overpriced stock, a lot of transactions take the form of joint ventures," he said. "Joint ventures are a preferred method of collaboration of competitors in new and emerging markets."
Internet Access
Zoellick Says Chinese Limits On Internet Use Are Fruitless
U.S. Trade Representative Robert Zoellick said the Chinese government's effort to control access to the Internet ultimately would fail, even if U.S. companies support the effort. He said the Internet is helping to bring change in a nation that used tanks to suppress pro-democracy demonstrators in 1989. Zoellick said he recently met some Internet entrepreneurs and software developers in China who had moved to the United States before that event, "but they eventually decided to go back because they thought they could be part of China's transformation. And they felt that the Internet would be part of that. And I believe it will."
Courts
Judges Uphold Decision In Meta Tag Case
A panel of federal judges upheld a decision to stop an equipment manufacturer from using a rival's trademarked term in Internet Web software code. The judges ruled that Florida-based Equitrac -- which makes hardware and software to track the use of office equipment -- must cease using the term "Copitrack" in the meta tags of its Web site. Meta tags are codes that describe the contents of the site and generally are "read" by Internet search engines. Promatek, Equitrac's Montreal-based competitor, sued Equitrac for using the word "Copitrack." The term resembles Promatek's trademarked product Copitrak, which tracks photocopy disbursement data. The judges agreed with Promatek's assertion that the use of Copitrack in the meta tags of Equitrac's Web coding likely would cause initial consumer confusion.
Telecom
ENUM-erating The Path To A Global Communications System
As technological developments enable old telephone networks to communicate with the Internet, policymakers and technologists must craft a consumer-friendly and globally interoperable system, panelists said at a forum on converging technologies. To facilitate communication across networks on a global scale, a group of experts on converging technologies urged the United States to adopt the electronic numbering (ENUM) standard, which enables users to store contact information that can be accessed by multiple means. Policymakers must find balance under such a system to address issues such as unsolicited e-mail and telemarketing, said Michael Gallagher, a Commerce Department deputy assistant secretary. Another panel at the forum debated whether the government should wait until more is known about converging technologies before considering new privacy and security regulations.

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