Intellectual Property
FTC Says It Has Remedy To Patent Office's Problems
     The FTC on Tuesday charged that the Patent and Trademark Office has granted patents of questionable quality and offered 10 suggestions to the office and to Congress to remedy the problem. "The patent system, especially in particular industries, is crucial, and competition is crucial as a spur to innovation," FTC Chairman Timothy Muris said in introducing a report on the balance between antitrust and patent law. "One of the messages of the report is that more patent industries are not always better" because of the way that "a questionable patent can impede" innovation, he said. One recommendation would change the standard for invalidating a patent. Patents can be rejected if similar inventions already exist, if the proposed invention is obvious or if the applicant commits fraud on the application. Courts currently require companies challenging patents to prove that it is invalid by "clear and convincing evidence." The FTC recommended that the burden be lowered to "a preponderance of evidence" against a patent.

Taxes
State Groups Laud Senators For Stalling Net-Tax Bill
     State and local groups urged senators to stick to their resolve to prevent the chamber from approving legislation that would permanently extend the current ban or a modified version of the bill now under consideration. "State and local groups are working with Congress to find a solution that is both thoughtful and fiscally fair," David Quam, director of state and federal relations at the National Governors Association, said during a briefing. The current moratorium expires Saturday, and the Senate this week adopted an agreement that will stall debate until at least next Thursday. It is unclear whether lawmakers will be able to address state and local groups' worries that the amended definition is so broad that it would exempt services taxable under current law. That would result in a huge loss for states and localities at a time when they can least afford it, Quam said, adding that until Congress holds hearings on the potential impact of the bill, state and local groups are urging a simple, temporary extension of the current ban.

Taxes
Ways And Means Panel Approves Thomas' Corporate Tax Bill
     The House Ways and Means Committee approved a corporate tax bill on a 24-15 vote. The legislation has a price tag of $60 billion over 10 years. One amendment was approved by voice vote. It made several last-minute changes to the bill. Democrats took aim at the $40 billion in tax breaks that would benefit multinational companies, charging that the proposed cuts have nothing to do with the underlying reason for the bill. The legislation is needed to bring the United States into compliance with the World Trade Organization's ruling against a tax break for exporters. Republicans defended the bill, with Nancy Johnson, R-Conn., arguing that it "would be just plain stupid" to repeal the current tax break without also replacing it.

On The Hill
Compromise Plan For Stock Options Garners Interest
     Sen. Michael Enzi has drafted legislation that fans say could be the political compromise for lawmakers concerned both about excessive executive compensation and the push by an accounting body to require companies to record employee stock options as expenses. The draft bill would require companies to expense the options of their top five executives but let them continue reporting the options for employees in the footnotes of their balance sheets. The proposal by Enzi, R-Wyo., also would delay implementation of any rule by the Financial Accounting Standards Board (FASB) to require stock-option expensing. Nevada Republican John Ensign, the co-author of a Senate bill that would postpone implementation of a FASB expensing rule, called the Enzi measure a "pretty good compromise" and asked businessmen, labor officials and academics to let lawmakers know if they could accept it.

Lobbying
Tech Industry Soldiers On With Stock-Option Campaign
     The technology industry has devised a multi-pronged approach to fight mandatory expensing of employee stock options, hoping to influence the nation's accounting-standards board with intellectual arguments and to sway lawmakers with real-life examples of how employees would benefit by keeping the status quo. Sun Microsystems created a video roundtable for lawmakers, where employees such as John Jennings explained that owning options "creates greater loyalties," affects innovation and drives people to work harder because they feel an ownership interest in the company. Sun also compiled more than 100 stories of employees donating profits to charities from selling company stock. The Electronics Industries Alliance, meanwhile, is aiming to persuade the Financial Accounting Standards Board that "mandating expensing is not going to give investors any more information, and it probably will give them less."

E-Government
E-Voting Firms Plan Coalition To Fight Negative News
     The leading vendors of e-voting hardware are finalizing plans for an industry coalition to counter negative media reports about e-voting technology, develop industry standards, and lobby federal, state and local lawmakers on the merits of electronic voting. The companies -- including Advanced Voting Solutions, Diebold Voting Systems, Election Systems & Software, Hart Intercivic, Sequoia Voting and Unilect -- are expected to announce their plans within weeks, and will either form their own group or operate within the auspices of the Information Technology Association of America (ITAA), which approached the companies with its own plan for a coalition in August. "We're still in discussion with the companies and haven't reached a decision," said Michael Kerr of ITAA's enterprise-solutions division. "We expect their announcement fairly soon." Spokesmen for the vendors were unavailable for comment.

Education
Minnesota Teachers Union Targets E-School Certification
     Education Minnesota, a 70,000-member teachers' union, has sued to get an online school's certification rescinded. The union claims that parents, not teachers are delivering the public school's instruction, which violates state law requiring that all teachers be certified and licensed. The Houston public school district, located about 150 miles south of Minneapolis, founded the 280-student school for kindergarten through seventh grades. Minnesota's Education Department "properly certified" the school, a department spokesman said. But Education Minnesota attorney Harley Ogata claims that the academy allows teachers to "assemble and deliver the materials to the computer, not to the end user. Instruction and curriculum is downloaded daily by parents and interaction is with parents, not teachers."