The MTTLR Blog

European Union (EU) regulators closed their investigation of  Qualcomm Inc. after all of the companies accusing Qualcomm of charging excessive royalties on technology patents withdrew their complaints. In 2005, six technology companies filed complaints alleging that the royalties Qualcomm has charged since its patented technology became part of Europe’s 3G standard are unreasonably high. Two of the companies, Nokia and Broadcom, withdrew their complaints after reaching separate outside settlements. Ericsson said in a statement that it is withdrawing the complaint and continuing “its ongoing dialogue with competition authorities around the world in relation to Qualcomm’s licensing practices.” Since all complaints have now been withdrawn, the EU dropped its investigation and is focusing its resources elsewhere. Qualcomm still faces antitrust scrutiny elsewhere in the world. Japan’s Fair Trade Commission said in September that Qualcomm coerced Japanese mobile-phone makers into agreements that prevented them from asserting their intellectual property rights, impeding fair competition and ordered Qualcomm to rescind the restrictive provisions. Earlier this year Qualcomm was fined 260 billion Won ($220 million USD) by South Korea’s antitrust agency for deterring competition through unfair fees and is currently appealing the fine. While the EU closed its four-year old antitrust investigation without levying a fine, Qualcomm was not absolved of wronging and the investigation could be restarted if another complaint is filed.

New Zealand copyright protesters

New Zealand’s government announced this week that their proposed “three strikes”/”graduated response” copyright law would not go into effect, and would be rewritten from the ground up.The law, which would have required ISPs to cut off internet access to users who had been accused of copyright infringement three or more times, had already been delayed from its initial effective date in February after stalled implementation negotiations and public protests caused lawmakers some concern.

Of particular note to those interested in U.S. copyright issues, Google submitted comments arguing that Internet disconnection is a disproportionate response to unproven allegations of copyright infringement. New Zealand recording industry groups had argued that the evidence of infringement they provide to ISPs is highly reliable, but Google’s comments cite to a 2006 report (summary here) that showed up to 30% of takedown notices Google received “presented an obvious question for a court”, and over half of requests to remove links appeared to be from businesses targeting competitors. Obviously, many of the takedown requests that Google fields are not from official industry groups, but given that U.S.  industry group representatives have likened innocent infringers to dolphins inevitably caught in fishing drift-nets, New Zealand ISPs and consumers had good reason to be concerned.

Image credit – “Dare not write, dare not speak, dare not feel” CC by-nc Fertala

by: Michael Schultz, Associate Editor, MTTLR

You (or your IT staff) may have been thankful to find that spam traffic has been a bit lighter in the last few weeks, after the recent shutdown of a major spam hub that, by some estimates, was responsible for as much as 75 percent of the world’s junk mail. You might have expected the company facilitating all of that spam – not to mention illegally gathered credit card information and child pornography – would have chosen to operate from the relative obscurity of an offshore hosting service. Instead, McColo Corporation set up shop in San Jose, California in a “top-level modern [...] IT center.” To be clear, McColo is merely the “virtual host” for those that are actually sending the spam; something akin to a landlord of an apartment building in which most, if not all, of the apartments are being used for illegal activity.

In an interesting twist, it wasn’t U.S. authorities that shut down the hub – instead the companies that provided internet connection for McColo decided to cut ties. This leaves open the possibility of McColo finding another internet provider – or the individual sites being hosted by McColo to disperse, making them harder to track and shut down. In fact, only two weeks after the shutdown, spam levels are reported to already be back to two-thirds of their previous levels.

Brian Krebs of the Washington Post, who is credited with the initial investigation and breaking the story, writes that “Multiple security researchers have recently published data naming McColo as the host for all of the top robot networks or "botnets," which are vast collections of hacked computers that are networked together to blast out spam or attack others online. These include SecureWorks, FireEye and ThreatExpert.” According to Mr. Krebs, “[what is] unclear is the extent to which McColo could be held legally responsible for the activities of the clients for whom it provides hosting services. There is no evidence that McColo has been charged with any crime, and these activities may not violate the law.”

So what is the law (and what should it be?) in this murky, seedy area of the internet? Below is a roundup of various links that may help to address that question:

FBI wants widespread monitoring of ‘illegal’ Internet activity
Illegal Internet Activity a Growing Concern for Enterprise Organizations
Using the Law to Address Illegal Activity on the Internet
Employer responsibility to report illegal activities established by Court
FBI Internet Crime Complaint Center

by: Andrew Gioia, Associate Editor, MTTLR

Last week, a court in the Netherlands criminalized the theft of”virtual goods.” (Dutch news report.) According to a ruling handed down by a Dutch court, two teenagers, aged 14 and 15, were found guilty of theft after physically coercing a 13-year-old boy into transferring virtual money, a virtual amulet, and a virtual mask to their accounts in the online fantasy adventure game, RuneScape. Though the court only dealt with the theft issue and not the more obvious assault, it plainly and forcefully held that “[t]hese virtual goods are considered goods under Dutch law, so this is theft.”

Despite both the clarity of this ruling and the apparent intellectual property and monetary value that can be derived from games with their own currency and property, game-based virtual theft claims have had a rather uncertain history. For instance, Second Life, one of the Internet’s largest virtual realities, has seen both the wrongful “taking” of in-game land and a lawsuit between users for copying the design of objects sold in Second Life’s marketplace in the past year alone.

In the US, Minnesota police refused to recognize $4,000 of virtual currency stolen in Final Fantasy as a crime, explaining that because virtual items “are devoid of monetary value,” no crime had actually been committed. Perhaps even more significantly, the MMORPG, EVE Online, saw a large-scale banking scheme that defrauded a number of users. The stolen money was estimated to be worth as much as $170,000 in the real-world marketplace, and the scam even got the attention of some in the legal community who likened it to “actionable real-world fraud”.

Virtual goods like these, including game-based currencies, may not only have real economic value, but online communities like Facebook, Live Journal, and even Dogster have begun to create sentimental, communicative, and self-expressive value in virtual gifts that members can send to each other. These businesses, as well as games like Second Life and Gaia, are in some cases making tens of millions of dollars in revenue by selling virtual goods to personalize virtual avatars, land, and the like, and at least South Korea has even begun taxing these virtual property transactions.

Ultimately, as long as virtual goods inside of video games can be converted into real economic value, online thefts like the one seen in the Netherlands will continue or even increase “as ‘criminals’ may think the court systems and the police are not educated in online gaming, or the law as it pertains to in-game items and cash.” As one Dutch columnist argued even before this recent virtual theft, “[a]s long as the original owner loses something of value (such as virtual items) due to the act of another individual who gains possession over the item, it should . . . be qualified as theft, no matter whether the locus delicti is in the physical or the virtual world.”

by: Ashley Tan, Associate Editor, MTTLR

I. Suing to Save the World

Image In the soul of the great machine by Simon Bisson.
Used under a Creative Commons BY-NC-ND 2.0 license.

Has the Large Hadron Collider destroyed the world yet? A tongue-in-cheek website suggests not.¹ The European Organization for Nuclear Research (CERN), which is responsible for constructing and operating the Large Hadron Collider (LHC), insists that fears about LHC-generated catastrophes are wholly without scientific foundation.² However, a group called the Citizens Against The Large Hadron Collider, established by nuclear physicist and former U.S. nuclear safety officer Walter L. Wagner³, not only argues that the LHC poses a significant danger of destroying the Earth, but has gone so far as to file in a U.S. district court in Hawaii to enjoin the LHC from proceeding to full operating capacity.⁴ Another group, led by German chemist and university professor Otto Rössler, tried to file a similar injunction with the European Court of Human Rights.⁵ Scientists associated with the LHC have received death threats⁶, hackers have broken into the LHC’s computers⁷, and in India, a sixteen-year-old girl reportedly committed suicide out of fear after watching a television program about the LHC’s danger to the earth.⁸ Hollywood frequently raises the specter of wayward science giving birth to a global disaster, but rarely does it venture to the courtroom for a solution in such cases. Will the real world prove more creative?

II. What Is the Large Hadron Collider and Why Do People Fear It?

The LHC is a particle accelerator, whose name derives from the fact that it is large—built in a ring shape under the countryside near Geneva, Switzerland, it has a radius of 27 kilometers (16.8 miles)—and that it accelerates hadron particles—better known to laymen as protons or ions—and engineers the collision of these particles.⁹ These collisions will occur at higher energies that are concentrated more densely than has ever been possible via man-made intervention before.¹⁰ By monitoring the results of the collisions, CERN scientists hope to recreate the conditions of the universe that existed a fraction of a second after the Big Bang, and to prove or disprove elements of the Standard Model, which is the currently-reigning theory for explaining why the laws of physics in our universe operate the way that they do.¹¹ On these statements, everyone can agree.

Less agreed-upon is whether the LHC could also prove correct certain theories about microscopic black holes, magnetic monopoles and “strangelets” by creating them.¹² A microscopic black hole is exactly what it sounds like: a tiny version of the black hole formed by the collapse of a dying star.¹³ According to the Citizens Against the LHC, the LHC could create such micro black holes at a rate of one per second, and if they accumulated, they would eventually suck the entire Earth into them.¹⁴ A magnetic monopole is a hypothetical particle that carries only one magnetic charge or “pole,” compared to the everyday magnet that always has a north and a south pole, and if they do exist, then theoretically, immediately upon creation they would begin to catalyze the decay of known particles like protons in an uncontrollable reaction similar to that of a nuclear bomb.¹⁵ And a strangelet is another hypothetical particle that, if it does exist and is created by the LHC, theoretically could trigger an unstoppable fusion reaction that would transform the whole planet into a gigantic strangelet.¹⁶

III. Judging a Potential Global Catastrophe

All three of the above scenarios would presumably end life as we know it if they came to pass, but CERN and most physicists believe that the probability of the LHC creating such scenarios is so infinitesimal as to be nonexistent.¹⁷ In particular, CERN argues that cosmic rays have entered the Earth every day for billions of years and while on Earth, have collided at far higher energies than the LHC will be able to produce without ever having resulted in a planet-wide catastrophe.¹⁸ Nevertheless, the Citizens Against the LHC, as represented by Spanish science writer Luís Sancho, have urged a U.S. district court in Hawaii to enjoin the LHC from full
operation.¹⁹

The main allegations made by Sancho: 1) the U.S. government has failed to carry out an environmental impact study of the LHC under the National Environmental Policy Act (NEPA), including a period for review and comments by the public; and 2) the U.S. government has failed to follow the risk-management requirements of the European Union’s “Precautionary Principle.”²⁰ The U.S. government has responded by questioning whether Sancho has standing to submit the case, whether a U.S. district court has jurisdiction over the subject matter and whether the case is moot due to the statute of limitations.²¹ On the matter of standing, it argues that Sancho has not alleged a “credible injury” that is personal to him, given that the main substance of his claim is that the European-based LHC may trigger an event that would have to destroy the entire world to affect him.²² On the matter of jurisdiction, the U.S. government argues that the LHC is the responsibility of CERN, which is an international, non-governmental body in which the U.S. government plays no significant, active part.²³ Alternatively, on the matter of mootness, the U.S. government holds that any duty of oversight would have arisen in 1997 or 1998, when the National Science Foundation and the U.S. Department of Justice “committed” to the LHC project, and that such a duty has already expired.²⁴ Either way, the federal government argues it has no duty under the National Environmental Policy Act to conduct environmental-impact studies of the LHC, as that act only applies to federal agencies and CERN is not a federal agency.²⁵

IV. The Timeline for Averting Planetary Destruction

At a combined hearing for the U.S. government’s motions to dismiss and for summary judgment, Chief Judge Helen Gillmor seemed sympathetic to the government’s arguments for lack of jurisdiction and of standing.²⁶ She ruled without permitting further argument that any allegations based on the Precautionary Principle of the EU would not be heard for lack of jurisdiction, as the underlying EU law had not been incorporated into U.S. domestic law.²⁷ However, after chiding both parties at length for committing numerous procedural errors, Judge Gillmor allowed them to continue filing documents with the proviso that each new filing must be with a leave of court to file.²⁸

On Sept. 26, 2008, Judge Gillmor heard the federal government’s motion to dismiss and granted it on the grounds that since the U.S.’s participation in the LHC project did not amount to a “major federal action” under NEPA, the court lacked subject matter jurisdiction to hear the suit.²⁹ The U.S.’s funding to CERN for the LHC constituted a relatively insignificant fraction of the total funding–$531 million out of an estimated $8 billion—and the U.S. also lacks control over the LHC, as its agreement with CERN only grants it non-voting “observer” status.³⁰ Given the lack of subject matter jurisdiction, Judge Gillmor declined to reach the issues of standing and mootness.³¹ While she noted that the suit is rooted in a “disagreement among scientists” that is of concern to a wider audience, Judge Gillmor was of the opinion that such “policy objections” were better addressed through the political process.³² So ends the legal action in the U.S. against the LHC, it would appear.

A suit in the European Court of Human Rights for an injunction against the LHC was summarily rejected without an official ruling.³³ But the Court is allowing the suit to proceed to judgment on the merits of a possible violation to the rights to life and to private family life, as guaranteed under the European Convention of Human Rights.³⁴ In the meantime, the LHC has suffered several technical setbacks that will prevent full operation, and consequently those controversial particle collisions, for several months.³⁵ It remains to be seen whether the European Court of Human Rights will evaluate the merits of the suit against the LHC, or whether CERN can fix the LHC in time to render that suit moot by virtue of operation without global destruction.

Editor’s Note: A number of commenters have raised concerns about the scientific qualifications of individuals involved in bringing these lawsuits. While we believe those qualifications are less relevant to the procedural legal issues discussed within the post, we wish to acknowledge the concerns. All qualifications as reported in this post are taken from the sworn affidavits of the parties involved. Certainly, if a case such as these were allowed to proceed to analysis on the merits, the qualifications of any scientific experts involved would be a serious issue.

by: Stephen Moyer, Associate Editor, MTTLR

Introduction

Image Biotic lensbaby by Sparky.
Used under a Creative Commons BY-NC 2.0 license.

The contributions of research universities to worldwide scientific progress have traditionally been focused on basic scientific discoveries, rather than efforts to ensure that their scientific discoveries actually reach people throughout the world.. Universities Allied for Essential Medicines (UAEM)¹ is a non-profit organization that works with faculty and student groups to help ensure the availability of essential medicines in poor countries.² Among other activities, UAEM hopes to persuade universities to commit to the principle that when they license university-developed medical-related technologies to private companies, a condition of the license will be that the private company agree to make medicines that are created using the university-developed technology available to the developing world at the lowest possible cost.³

The history of this movement stretches back to 2001 when Yale University students became aware that an important anti-HIV medication, stavudine (also known as d4T), that had been developed at Yale and licensed by Yale to the pharmaceutical company Bristol-Myers Squibb (BMS), was not available to many HIV-positive patients in South Africa because of its high cost. ⁴ The high cost of the drug stemmed at least in part from the fact that it was under patent protection in South Africa.⁵ After Yale students and others petitioned Yale and BMS not to enforce the patent in South Africa, BMS ultimately agreed to the proposal, which thereby enabled the sale of much cheaper generic versions of the drug. ⁶

From this experience (which received a substantial amount of national publicity ⁷) and the understanding that universities are a major source of scientific discoveries that lead to the development of new medicines,⁸ students at Yale and other universities became convinced of the need for a national organization that would seek to persuade universities to ensure that university-developed scientific advances do not fail to reach people in developing countries because of intellectual property protection of the drugs.

UAEM’s Argument

The general proposition that drug companies should make medicines available to low income countries at the lowest possible cost is easy to support on a humanitarian level, but the proposition may appear less realistic on a practical level: pharmaceutical research and development are costly, as is the manufacture of drugs. Patent protection for new drugs is understood to be integral to the ability of pharmaceutical companies to generate income, recoup their costs, and make drug development profitable to fund on-going research. UAEM argrees that patent protection of new drugs is indeed necessary and appropriate in developed countries, but argues that patent protection of new drugs in developing countries can be harmful. First-world prices are prohibitive for most third-world consumers – drug companies do not realize significant amounts of income from poorer countries, precisely because the high prices result in comparatively small amounts of drugs sold.⁹ Therefore, UAEM argues that universities and drug companies can make their drugs available to developing countries at low cost, realize higher volumes of sales, and still generate nearly the same profits as they would by selling higher-cost versions of the drugs in these countries. ¹⁰

Philadelphia Consensus Statement and Annual Meetings

In 2006, UAEM drafted a concise document that captures the major goals of the organization, the “Philadelphia Consensus Statement” (PCS).¹¹ The PCS is a collection of recommendations that UAEM urges universities to adopt, the key recommendations being that, in addition to ensuring that university-developed technologies are available to developing countries, universities should also promote research into diseases that primarily affect developing countries, and that universities should measure their success at research based on its “impact on human welfare”, rather than just its scientific or income-producing value.¹² UAEM obtained support of many prominent individuals and organizations for the PCS, with a list of initial signatories to the PCS that includes multiple Nobel prize winners, university leaders, and international organizations.¹³

UAEM has held national meetings every year since 2005 to further develop and coordinate its efforts; this year’s meeting will be held at the University of California-Berkeley, on October 17-19, 2008.¹⁴

Some Criticisms of UAEM’s Approach

While most people support UAEM’s mission, some are concerned that UAEM’s efforts regarding university technology licensing may be ineffective or even counter-productive towards the overall objective of increasing access to medicines.

One concern is that it frequently may not be possible for a university to only license technologies to companies that are willing to make drugs available to developing countries at low cost; it can be difficult for universities to find any companies interested in licensing their technologies. The more restrictions the university puts on licensing agreements, these critics argue, the more difficult it may be for the university to find a party interested in licensing the university technology. ¹⁵

Another concern is that if companies agree to allow lower-priced generic versions of drugs to be produced in developing countries while those drugs are still patent-protected in developed countries, the generic drugs could be smuggled into developed countries, and severely damage drug sales there¹⁶. UAEM counters that there is not evidence that this type of transfer happens on a large scale, and that drugs can be marked with identifying source information, in order to minimize this problem. ¹⁷

Conclusion

Access to medicine remains a major problem worldwide – the World Health Organization estimates that about 10 million people die every year because they do not have access to existing medicines.¹⁸ Universities play a major role in developing new medicines, and it is consistent with the mission of universities to ensure that medicines developed on their campuses reach as much of the world’s population as possible. While it remains to be seen what impact UAEM’s efforts will have on universities’ technology licensing policies in the long term, UAEM has brought attention to the important connection between university research and global access to medicine.

by: Morgan Willard, MTTLR Associate Editor

This past June, the Internet Corporation for Assigned Names and Numbers voted upon and approved a set of measures that constitute sweeping changes for the way that the Domain Name System (DNS), the set of rules governing how internet addresses are located and assigned, works.

Specifically, the measures included two major expansions to how domain names will be registered in the future:

1. Global Top-Level Domains (gTLDs), the universal extensions such as .com, .net, and .info that are appended to all web addresses, will no longer be restricted to a finite list that is voted upon and expanded by ICANN itself.
2. Domain names will now accomodate non-Latin character sets such as Arabic and Cyrillic.

Both of these resolutions will have far-reaching implications for citizens of the internet.

Global Top-Level Domain Expansion

Hailed by ICANN as “a massive increase in the ‘real estate’ of the Internet”, it will soon be possible for companies and organizations to apply for the creation of a new gTLD. It is expected that there will be several different types of gTLDs that will quickly generate applications:

• Generic Words: Categorical words such as the already existing .travel gTLD will likely spring up quickly to appeal to a wide variety of potential registrants. Expect to see applications for everything from .salon to .banana.
• Regional Names: While countries are already able to get gTLD names through the Country Code Top-Level Domain (ccTLD) system, it is expected that a variety of other geographic and cultural communities will be interested in their own gTLD (imagine .nyc for New York City) similar to the existing .cat domain for the Catalan community.
• Brands: Global brand names such as Amazon and Coca-Cola will likely be interested in having a gTLD of their own.

While the new system will open up many opportunities for enterprising organizations and possibly allow companies to stop sitting on a keyboard to create a short domain name, there are also valid concerns (especially for trademark holders) about such an open system.

Non-Latin Character Domain Names

Until the recent vote, all domain names had to be using the Roman alphabet. That is, even though there were country-specific TLDs for Russia (.ru) or China (.cn), the domain name itself had to be in the Roman alphabet. This was due to technical limitations: domain names previously used the ASCII (American Standard Code for Information Interchange) standard which is based on the English alphabet and does not allow for most non-English characters. In the future, the Unicode system will be used which allows for every character of every language to be represented.

This expansion will allow greater accessibility to the global internet community, as non-English-speaking users will now be able to access domains in their native language instead of having to learn and remember a different character set for interacting with the internet. However, there are some concerns that phishers (identity thieves) could create domain names using characters similar, but not identical, to their Latin counterparts to make domain names that may be misleadings to online users.

Further Analysis and Reading

For more information and analysis of the impacts of these changes, here are some useful links:

• ICANN’s official announcements about the meeting and about the new gTLD system.
• Computer World has a good overview of the changes with a variety of viewpoints.
• Com Laude, a domain registrar, published an in-depth briefing newsletter about the new gTLD system and its effects.
• The Industry Standard: writes about why non-Latin domain names are more important than more gTLDs.
• Information Today analyzes the possible pitfalls of the new gTLD system
• Intellectual Property Watch questions the ICANN’s vague policies of morality rejections for new gTLDs and warns about the risks of cybersquatting and user confusion.
• InformationWeek has concerns about what happens if a gTLD manager fails.
• Names@Work takes a look at the new gTLD registry providers, those companies that will be maintaining the registrations for new gTLDs