Politics and Law

Europe is set to get a major overhaul of its telecommunications regulation, after the European Parliament and Council of Telecoms Ministers reached a compromise on the rights of Internet users.

The Telecoms Reform Package is a raft of new laws that tackle issues ranging from data-breach notification to faster number porting. Following an agreement reached on Wednesday night, the package will now become part of national legislation in every EU country, with a deadline of May 2011.

A sticking point in the package's progress had been a provision regarding "three strikes" laws targeting Internet users suspected of unlawful file-sharing of copyrighted material. But negotiations led to an "Internet freedom provision," which states that any measures taken by member states to limit Internet access or use must "respect the fundamental rights and freedoms of natural persons, as guaranteed by the European Convention for the Protection of Human Rights and Fundamental Freedoms and general principles of Community law."

Read more of "European 'internet freedom' law agreed at ZDNet UK.

"I don't think John McCain could run a major corporation. I don't think Barack Obama could run a major corporation. I don't think Joe Biden could, either. But it is not the same as being the president or vice president of the United States. It is a fallacy to suggest that the country is like a company. To run a business, you have to have a lifetime of experience in business, but that's not what Sarah Palin, John McCain, Barack Obama or Joe Biden are doing."
- Former Hewlett-Packard CEO Carly Fiorina

(Credit: AllThingsDigital)

Her dreams of heading up the World Bank dashed, former Hewlett-Packard Chief Executive Carly Fiorina, the architect of one of the worst tech mergers in history, has turned her attention to the U.S. Senate.

After months of speculation, Fiorina on Wednesday officially announced her candidacy. She'll run as a Republican against Sen. Barbara Boxer (D-Calif.). Of course to do that, she must first win the Republican primary. Fiorina broke the news in an op-ed in the Orange County Register.

"Admittedly, I have not always been engaged in the electoral process, and I should have been," she wrote. "For many years I felt disconnected from the decisions made in Washington and, to be honest, really didn't think my vote mattered because I didn't have a direct line of sight from my vote to a result. I realize that thinking was wrong. As I grew throughout my career, beginning as a secretary and eventually becoming a CEO, I saw how government impacted business. I learned more as a member of advisory boards at the State Department, the Pentagon and the CIA. I now understand, in a very real way, that the decisions made by the Senate impact every family and every business, of any size, in America. This is what motivates me to run for the U.S. Senate. And so today I am announcing my candidacy to serve the people of California as your next U.S. senator. ... Together we can turn things around."

Together we can turn things around? Not if Fiorina's performance at HP is any indication. Before she was forced out of the company by its board of directors, she was so at odds with the uniquely Californian "HP Way" that her corner office could have been powered solely by Bill Hewlett spinning in his grave.

UPDATE: Here's another Fiorina op-ed (PDF) from earlier this year in which she discusses executive pay. Unsurprisingly, she is against President Obama's efforts to restore "common sense" to CEO compensation. And why wouldn't she be? After all she walked away from HP with a $21 million severance package ...

Story Copyright (c) 2009 AllThingsD. All rights reserved.

For the last decade or so, Internet service providers have been dealing with requests to block access to pornographic or copyright-infringing Web sites, or in China, ones that dare to criticize the government.

Now a U.S. House of Representatives bill is taking the unusual step of requiring Internet providers to block access to online financial scams that fraudulently invoke the Securities Investor Protection Corporation--or face fines and federal court injunctions.

The House Financial Services Committee approved the legislation on Wednesday by a 41 to 28 vote.

If you've never heard of the SIPC, you're not alone. It's a government-linked entity that aids investors when funds are missing from their accounts, up to a limit of $500,000 for stocks, bonds, and mutual funds. Only investor accounts that investors have opened with members of the SIPC--here's a list--qualify for its protection.

It turns out that occasionally, Internet fraudsters, scamsters, and other assorted malcontents have posed as legitimate brokerage firms that are SIPC members, often with a similar name or domain name. The scam may be a too-good-to-be-true offer to buy securities that asks the unwitting customer to pay fees in advance, or schemes involving fraudulent checks that eventually bounce.

That seems to be in part what prompted Rep. Paul Kanjorski, a Pennsylvania Democrat and chairman of a key subcommittee, to introduce the Investor Protection Act a few weeks ago. Section 508 of that bill says:

Any Internet service provider that, on or through a system or network controlled or operated by the Internet service provider, transmits, routes, provides connections for, or stores any material containing any misrepresentation (of the SIPC) shall be liable for any damages caused thereby, including damages suffered by the SIPC, if the Internet service provider...is aware of facts or circumstances from which it is apparent that the material contains a misrepresentation.

That section isn't mentioned in Kanjorski's press release dated October 1, which is why Internet providers were a bit taken aback when they found out about it a few days ago. The Internet Commerce Coalition sent a letter to Kanjorski before Wednesday's vote raising concerns with the bill, but the industry isn't terribly optimistic.

One potential problem with Kanjorski's bill is that most Internet providers simply don't have a good way to block access to any electronic "material" containing fake SIPC data. That wording is broader than just Web pages: it includes blocking certain e-mail, IM conversations, VoIP chats, and so on. And even the more straightforward task of blocking Web sites can be overly broad and problematic, which is why a federal judge in Pennsylvania declared a child porn filtering law to be unconstitutional in a landmark 2004 ruling.

Internet providers are also worried that Kanjorski's requirement--and the accompanying civil penalties and injunctions--would apply even if the blocking is not technically feasible. Or if it's impossible. (Other questions: Would this blocking requirement apply to private-sector employers? Schools and universities? Locally owned coffee shops that provide Internet service through Wi-Fi?)

Fraudulent Web sites have bedeviled the SIPC, off and on, for at least six years. In 2003, the group distributed a public warning against "brokerage identity theft" and followed up by asking the FBI to investigate a fake site that resembled the SIPC's own.

The SIPC does have a searchable database of its members, listing street addresses, but it doesn't take the obvious step of listing members' official Web sites, which other certification programs like Truste do.

Searching on San Francisco shows, for instance, that SIPC-listed Whitehall-Parker Securities has an address on Pacific Avenue. But an investor can't easily tell whether whitehall-parker.com is the actual site; a scammer could easily set up a fake site at whitehallparker.com (which, as of this writing, is available to be registered).

The Treasury Department's version of the Investor Protection Act of 2009 released in July doesn't seem to include the Internet-filtering section, meaning that the Obama administration concluded that it was unnecessary. So what prompted Kanjorski to insert it?

Addendum at 11:30 a.m. PT: Abigail McDonough, Kanjorski's spokeswoman, told me that her boss is open to modifying the language of the bill to reflect industry concerns. It also turns out that the language from the Investor Protection Act was borrowed from H.R. 2798, which was introduced in June by Rep. Michael Arcuri, D-N.Y., as part of a post-Bernie Madoff scandal effort to increase the level of SIPC guarantees for investors.

One Capitol Hill source says the SIPC asked for that language to be included in the Investor Protection Act. And a representative of SIPC says the organization may not have a response until Thursday because its president, Stephen Harbeck, is traveling from China.

New York Attorney General Andrew M. Cuomo filed a federal antitrust lawsuit Wednesday against Intel that accuses it of paying computer makers rebates to illegally maintain its monopoly power, the newest among several such attacks that have dogged the chipmaker in recent years.

"Intel has engaged in a systematic worldwide campaign of illegal, exclusionary conduct to maintain its monopoly power and prices in the market for x86 microprocessors," the suit asserts. "By exacting exclusive or near-exclusive agreements from large computer makers in exchange for payments totaling billions of dollars, and threatening retaliation against any company that did not heed its wishes, Intel robbed its competitors of the opportunity to challenge Intel's dominance in key segments of the market. This illegal behavior was highly detrimental to consumers, competition, and innovation."

The suit "seeks to bar further anticompetitive acts by Intel, restore lost competition, recover monetary damages suffered by New York governmental entities and consumers, and collect penalties," Cuomo said in a statement.

The suit (click for PDF) makes the state the newest party to go after the dominant chipmaker. Intel also is in the midst of an antitrust suit brought by top rival AMD in 2005 and appealing a massive $1.5 billion fine from the European Commission from a later case in the European Union.

New York Attorney General Andrew M. Cuomo

(Credit: New York Office of the Attorney General)

Intel will defend itself, Intel spokesman Chuck Mulloy said in response to the New York suit.

"We disagree with the New York attorney general. Neither consumers--who have consistently benefited from lower prices and increased innovation--nor justice are being served by the decision to file this case now," Mulloy said.

Of e-mails the attorney general quoted as evidence Intel abused its position, all already emerged in earlier cases, he added. "It is the AMD case filed 4.5 years ago. It's the same case the EU brought. There's nothing significant or new here that hasn't been discovered," Mulloy said.

According to the suit, computer makers "frequently decided, when faced with the array of incentives and threats which Intel brought to bear, to collaborate with Intel in restricting their purchases from AMD."

"In a February 27, 2003 internal Dell document, for example, it was assumed that 'aggressive' purchases by Dell from AMD could result in '(r)etaliatory (rebate) reductions (by Intel that) could be severe and prolonged with impact to all LOBs (lines of business),'" the suit said. "Another Dell document from March 2003 concluded that '(a)nticipated Intel response wipes out all potential opinc (operating income) upside from going with AMD.'"

And an unnamed IBM executive said in a 2005 e-mail that balancing business interests against Intel's response was hard. From the suit:

I understand the point about the accounts wanting a full AMD portfolio. The question is can we afford to accept the wrath of Intel if we do the AMD full portfolio? It is a very hard question to deal with. On the one hand, having Intel help us has been one element of why we are doing better in the market. If they start to sell against us again I am afraid that we would be in a very difficult spot. On the other hand, if we leave Sun and HP an opening with AMD we will (be) very exposed on that side of things.

Cuomo's office said it began investigating the case in January 2008, "reviewed millions of pages of documents and e-mails and took testimony from several dozen witnesses."

Updated 9:43 a.m. PST with further details from the lawsuit.

Oracle is taking a hard line in dealing with European Union objections to its planned acquisition of Sun Microsystems, according to a Financial Times report Tuesday.

EU antitrust regulators are concerned that Oracle, which has a large business in proprietary software, won't be a good home for Sun's open-source MySQL database business. According to the report, Oracle is unyielding, offering no concessions to deal with the EU's concerns.

That stance could lead the regulators to issue a formal complaint objecting to the deal, and that move could occur within days, according unnamed sources in the story. Neither the EU or Oracle commented for the story.

MySQL's former chief executive, Marten Mickos, has urged the EU to approve the acquisition, but cofounder Monty Widenius has objected. Sun shareholders and the U.S. Justice Department have approved the deal.

Could a legal challenge threaten the launch of Barnes & Noble's Nook e-reader?

In a new lawsuit, start-up Spring Design is seeking not only monetary damages from Barnes & Noble, but also is looking to get an injunction barring sales of the Nook, which it says misappropriates its trade secrets.

Spring Design said in a statement Monday that it had filed a lawsuit against Barnes & Noble, but the statement did not specify what damages it was seeking.

However, it turns out that the lawsuit, filed in federal court in San Jose, Calif., seeks both monetary damages as well as a halt to sales of the Nook.

According to the lawsuit, a copy of which was seen by CNET News, Spring Design says it is seeking "preliminary and permanent injunctive relief... restraining and enjoining B&N from use or disclosure of Spring's confidential information or trade secrets, including the sale of the Nook."

The Nook, like Spring Design's Alex, combines a color touch screen with an e-ink display, and both readers use the Android operating system. In its lawsuit, Spring Design says it showed its plans for the Alex to Barnes & Noble, which showed interest in the product and gave no indication it was working on a similar device.

The Nook, a clear and present challenger to Amazon's Kindle, is due to go on sale later this month for $259.

Barnes & Noble has declined to comment on the lawsuit, saying it does not discuss litigation matters.

Court papers filed by Spring Design also include a confidentiality agreement, signed in February, between the company and Barnes & Noble, as well as early Spring Design presentations and e-mails between Barnes & Noble and Spring executives.

As a reminder, here's a look at Spring Design's Alex (left) and Barnes & Noble's Nook (note--the images are not to scale):

(Credit: Spring Design)

(Credit: Barnes & Noble)

A Silicon Valley start-up said it sued Barnes & Noble on Monday, claiming that the bookseller misappropriated trade secrets in creating the Nook e-reader.

Cupertino, Calif-based Spring Design said it had a nondisclosure agreement with Barnes & Noble and had been discussing its e-reader plans with the bookseller since early this year.

"Since the beginning of 2009 Spring and Barnes & Noble worked within a non-disclosure agreement, including many meetings, emails and conference calls with executives ranging up to the president of BarnesandNoble.com, discussing confidential information regarding the features, functionality and capabilities of Alex," Spring Design said in a statement. "Throughout, Barnes & Noble's marketing and technical executives extolled Alex's 'innovative' features, never mentioning their use of those features until the public disclosure of the Nook."

The press release from Spring Design did not say in what court the suit was filed, or mention what damages were being sought.

Spring Design announced its Alex e-reader just days before Barnes & Noble formally unveiled the Nook. Both e-readers use the Android operating system and combine an e-ink screen with a color touch screen.

Eric Kmiec, Spring Design's vice president of sales and marketing, said that the company has been working on the Alex since 2006.

"Spring Design unfortunately had to take the appropriate action to protect its intellectual property rights," Kmiec said in a statement. "We showed the Alex e-book design to Barnes & Noble in good faith with the intention of working together to provide a superior dual screen e-book to the market."

A Barnes & Noble representative was not immediately available to comment. (Update, 9:30 a.m. Nov. 3: A Barnes & Noble representative said that the company does not comment on litigation.)

Barnes & Noble's Nook, which competes head-on with Amazon's Kindle, is due to go on sale later this month for $259.

Here's a look at the Alex:

(Credit: Spring Design)

as compared to the Nook:

(Credit: Barnes & Noble)

Note: This story originally misstated the day that the lawsuit was filed. It was filed on Monday.

The accidental disclosure of a House ethics investigation has kicked up quite a fuss on Capitol Hill as it turns out that more than 30 congressman and aides are under investigation. But after committee chairman Zoe Lofgren (D-Calif.) disclosed the breach on the House floor late Thursday, her colleague, Rep. Jo Bonner (Ala.), who is the committee's ranking Republican, spoke next, telling fellow members that the breach was an isolated incident.

Not exactly.

In February, a company that monitors P2P networks said that it had found blueprints and avionics about the president's helicopter, Marine One, on a computer in Tehran. An investigation later found that a third-party defense contractor with access to that data was using a computer that also had P2P file-sharing software on its hard drive...

Read more of "File Sharing's Mysteries Again Stump Uncle Sam" on CBSNews.com.

The organization responsible for managing the assignment of domain names and IP addresses has approved a new plan to allow non-Latin characters in Web extensions.

Known as Internationalized Domain Names (IDNs), the system is designed to globalize the Net so regions around the world can use their own local alphabet characters to surf in cyberspace, the Internet Corporation for Assigned Names and Numbers, or ICANN, said Friday.

Calling IDNs the "biggest technical change" to the Internet since its birth 40 years ago, ICANN unanimously approved the plan on the final day of its six-day conference in Seoul.

IDNs will allow domain names to be to be written in native character sets, such as Chinese, Arabic, and Greek. In charge of managing domain names, ICANN has argued that IDNs are necessary to expand use of the Web in regions where people don't understand English. Since its inception, the Internet has been limited to the Latin character set used by the U.S. and many other nations.

"The coming introduction of non-Latin characters represents the biggest technical change to the Internet since it was created four decades ago," said ICANN chairman Peter Dengate Thrush in a statement. "Right now Internet address endings are limited to Latin characters--A to Z. But the Fast Track Process is the first step in bringing the 100,000 characters of the languages of the world online for domain names."

To expedite the new plan, ICANN will launch a Fast Track process on November 16. At that time, the organization will begin accepting applications from countries for new top level domains, or Internet extensions, based on each nation's character set.

Initially, the change will apply only to local country codes, such as .kr for Korea and .ru for Russia. Major top level domains (TLDs) such as .com, .net., and .org won't see non-Latin editions just yet. But ICANN is pushing to make progress on these major TLDs and hopes to include them in the IDN system before long.

ICANN had discussed and debated IDNs for years, during which time much testing, development, and global cooperation were needed to jump start the new system.

"This is a culmination of years of work, tests, study and discussion by the ICANN community," said Thrush. "To see this finally start to unfold is to see the beginning of an historic change in the Internet and who uses it."