Jimm Phillips

The White House has until early October to decide whether to veto a U.S. International Trade Commission exclusion order that would ban the import of certain Samsung mobile devices because they violated two Apple patents: U.S. Patent Nos. 7,479,949 and 7,912,501 (CD Aug 15 p10). The exclusion order against Samsung is the latest episode in a yearslong series of legal battles at the ITC and federal courts between the top smartphone manufacturers as each seeks to gain market share. Patent attorneys and industry experts told us court-ordered sales bans typically have only a limited effect on the wireless carriers that have deals with the manufacturers to provide mobile devices to their subscribers.

A coalition of advocacy and consumer groups for deaf and blind persons opposed multiple provisions of the FCC’s June order that would institute changes to the Video Relay Service (VRS) program, saying in comments released Tuesday that the order “may cause harm to the quality of VRS” (http://bit.ly/12mKIrd). The VRS order would reduce compensation rates to various-sized providers and created interoperability provisions to give users power to more easily choose providers and equipment (CD June 11 p1). The groups said they believe there has been “no effort on the part of the Commission to compensate or reward providers for improving functional equivalency in VRS calls. The Commission needs to reward such competition-driven innovation even during any efforts to improve the efficiency of the VRS system.”

The U.S. International Trade Commission issued an injunction after our deadline Friday on Samsung mobile devices that violated two Apple patents. The full details of the ban, which will take place within 60 days of Friday’s ruling, were not yet available. The ITC vote followed a hearing earlier Friday at the Court of Appeals for the Federal Circuit. There, Apple told a three-judge panel that upholding a lower court’s decision not to ban 26 Samsung mobile devices a San Jose federal jury found last year violated six Apple patents would be a “fundamental change” to U.S. patent law. Apple also faced a hearing at the U.S. District Court, Manhattan, in connection with the ruling last month that Apple violated antitrust laws by conspiring with publishers to “eliminate retail competition and raise the prices for e-books."

The White House directed the departments of Commerce, Homeland Security (DHS) and Treasury Tuesday to publish reports they had submitted to the White House in June on the feasibility of incentives to encourage industry adoption of cybersecurity practices, including the Cybersecurity Framework being developed by the National Institute of Standards and Technology (NIST). DHS’s recommendations track with the results of a preliminary study of cybersecurity incentives the department conducted in late May (CD July 22 p10).

The Cybersecurity Act of 2013 (S-1353) passed the Senate Commerce Committee with broad industry support just prior to the August recess; the bill would authorize the National Institute of Standards and Technology (NIST) to focus on cybersecurity, including its ongoing work with industry to develop a voluntary cybersecurity framework (CD July 31 p1).

Commissioner Julie Brill supports having the FTC use its authority under Section 6(b) of the FTC Act to study the business practices of patent assertion entities and examine how such PAE practices affect competition and consumer interests, she said Wednesday. Section 6(b) of the FTC Act gives the agency the authority to do a full investigation of an industry’s business practices, including issuing subpoenas, and report their findings to Congress and the public. Chairwoman Edith Ramirez said in June that the commission should initiate a 6(b) study of PAEs, but didn’t say she would formally ask the commission to vote to start one (CD June 21 p16). Brill told us after an American Constitution Society event that Commissioner Maureen Ohlhausen has also said she supports conducting a 6(b) study. Ohlhausen and fellow Commissioner Joshua Wright did not respond to a request for comment.

Senate Antitrust Subcommittee Chairwoman Amy Klobuchar, D-Minn., said Tuesday she plans to introduce legislation to address “competition issues in the patent world.” Witnesses at a subcommittee hearing Tuesday had made it evident that some standard-setting organizations (SSOs) are taking antitrust concerns related to standard-essential patents (SEPs) “seriously” by voluntarily adopting best practices and updating their intellectual property rights policies, Klobuchar said. However, it may now be time for Congress to get involved or “we need to up the role of enforcement agencies and have that complementary to the work of the SSOs,” she said. Klobuchar said she’s considering legislation that would “clarify” the standards for issuing injunctions and U.S. International Trade Commission (ITC) exclusion orders related to SEPs, along with legislation to address the FTC’s role in the “patent troll” debate and its impact on competition and consumers. Klobuchar told us after the hearing that she plans to introduce that legislation in the fall.

Sprint is hoping for a better second half of the year, following the June 30 shutdown of its Nextel network, but it still faces issues related to that closure “that will impact the second half of the year,” Sprint CEO Dan Hesse said Tuesday during a conference call. Sprint lost a net 2 million subscribers during Q2, which it said was mainly due to the Nextel shutdown; the carrier lost a net 560,000 subscribers during Q1. More than 1.3 million customers were still on the Nextel network at the beginning of Q2 -- 465,000 joined Sprint’s network before the Nextel shutdown, Sprint said. The carrier had 53.4 million subscribers at the end of the quarter. Sprint expects to see fewer gross subscriber additions during Q3 than during the same period last year due to deployment of its Network Vision network upgrade program, Hesse said.

The most important step the Senate Commerce Committee can take in improving cybersecurity in critical U.S. infrastructure is to “make sure the technical experts” at the National Institute of Standards and Technology “stay engaged and working with the private sector to develop effective cybersecurity standards,” said Chairman Jay Rockefeller, D-W.Va. The committee hearing where he spoke Thursday was largely a chance for Rockefeller and Ranking Member John Thune, R-S.D., to showcase the Cybersecurity Act of 2013, which they introduced the day before (http://1.usa.gov/19iJL7R).

AT&T believes its $1.2 billion bid to buy Leap Wireless will “accelerate our entry into the prepaid segment much more so than we would have been able to do by ourselves,” said AT&T Mobility President Ralph de la Vega Tuesday on a quarterly earnings call. For Q2, the carrier added a net 551,000 postpaid subscribers and 11,000 prepaid subscribers (CD July 24 p16). AT&T began offering a new prepaid service, Aio Wireless, in early May (CD May 10 p19). The carrier believes there is “a strong growth opportunity” in prepaid, de la Vega said.