lennyesq

Sat, 13 Mar 2010 20:30:58 GMT

PEOPLE OF THE STATE OF NEW YORK V. DUDLEY RAMSAY (Supreme Ct., Kings Cty., Mar. 12, 2010) – Dudley Ramsay, a 25-year-old Brooklyn man was convicted by a New York City jury today on felony and misdemeanor charges of beating his five-month-old dachshund puppy ‘Junior’ to death.

PEOPLE OF THE STATE OF NEW YORK V. DUDLEY RAMSAY

(Supreme Ct., Kings Cty., Mar. 12, 2010) – Dudley Ramsay, a 25-year-old Brooklyn man was convicted by a New York City jury today on felony and misdemeanor charges of beating his five-month-old dachshund puppy ‘Junior’ to death.

Podcast Ipsa Loquitur: New Jury Rules, Legal Comedy Website, and Schools Spying on Students

socialmedialawstudents@gmail.com (Rex Gradeless) — Sat, 13 Mar 2010 14:06:48 GMT

Huma and Josh discuss new proposed jury instructions. Are they re-inventing the wheel, or making something actually useful? Find out what new comedy website for lawyers has everyone laughing. Our dynamic duo also discusses what one southeast Pennsylvania school district is doing to keep an eye on their students, literally. No related posts.

New Jury Rules
These are a model set of jury instructions to give jurors more specific guidelines on what they can and cannot do before and after a case.
The rules are nothing new. They are already told not to talk about the case, and these rules just make sure people don’t do it with a different medium. Huma thinks it’s important that jurors be told not to investigate the case on the Internet. Josh thinks this is all pretty obvious and people should know not to talk about cases, but agrees that googling things is the bigger issue.

New Comedy Website
Overheard in Court is Texts from Last Night for lawyers. They run the gamut for level of humor, but most are pretty fun. Huma thinks that the hilarity in the courtroom is under appreciated. Huma knows a lot about this because she apparently listens to oral argument recordings for fun. Josh tried doing it, but technical difficulties prevented him.

Schools Spying on Students
The Lower Merion school district gave its students laptops and then ~~spied on them hardcore~~ allegedly used those webcams to see what students were doing. Huma thinks this is unconstitutional, Josh thinks that constitutional or not, it’s just immoral! Gizmodo has more. It’s a good thing Huma’s school wasn’t looking at her, because apparently she looks at all sorts of crazy stuff on the Internet.

This week’s episode brought to you by Chrometa. E-mail sales[at]chrometa[dot]com and mention Podcast Ipsa Loquitur for a discount!

No related posts.

New Jury Rules These are a model set of jury instructions to give jurors more specific guidelines on what they can and cannot do before and after a case. The rules are nothing new. They are already told not to talk about the case, and these rules just make sure people don't do it with a different medium. Huma thinks it's important that jurors be told not to investigate the case on the Internet. Josh thinks this is all pretty obvious and people should know not to talk about cases, but agrees that googling things is the bigger issue. New Comedy Website Overheard in Court is Texts from Last Night for lawyers. They run the gamut for level of humor, but most are pretty fun. Huma thinks that the hilarity in the courtroom is under appreciated. Huma knows a lot about this because she apparently listens to oral argument recordings for fun. Josh tried doing it, but technical difficulties prevented him. Schools Spying on Students The Lower Merion school district gave its students laptops and then spied on them hardcore allegedly used those webcams to see what students were doing. Huma thinks this is unconstitutional, Josh thinks that constitutional or not, it's just immoral! Gizmodo has more. It's a good thing Huma's school wasn't looking at her, because apparently she looks at all sorts of crazy stuff on the Internet. This week's episode brought to you by Chrometa. E-mail sales[at]chrometa[dot]com and mention Podcast Ipsa Loquitur for a discount! No related posts.

lennyesq

Sat, 13 Mar 2010 03:01:53 GMT

Second Circuit Rejects Most Of Attorney Advertising Rules “The speech that Defendants’ content-based restrictions seeks to regulate—that which is irrelevant, unverifiable, and non-informational—is not inherently false, deceptive, or misleading. Defendants’ own press release described its proposed rules as protecting consumers against ‘potentially misleading ads,’” the panel wrote inAlexander v. Cahill, 07-3677-cv, 07-3900- cv. The Second Circuit decision [...]

Second Circuit Rejects Most Of Attorney Advertising Rules

“The speech that Defendants’ content-based restrictions seeks to regulate—that which is irrelevant, unverifiable, and non-informational—is not inherently false, deceptive, or misleading. Defendants’ own press release described its proposed rules as protecting consumers against ‘potentially misleading ads,’” the panel wrote inAlexander v. Cahill, 07-3677-cv, 07-3900- cv.

The Second Circuit decision appears on page 17 of the print edition of today’s Law Journal

The ruling primarily affirms the July 2007 decision by Northern District Judge Frederick J. Scullin.

Courtesy of NYLJ–Noeleen G. Walder–Read full NYLJ article/breaking news.

FDA Responds to EWG's Letter Concerning Sunscreen Guidelines

Fri, 12 Mar 2010 23:53:00 GMT

In a March 2, 2010 letter, the Food and Drug Administration (FDA) responded to the Environmental Working Group’s (EWG) July 15, 2009, letter concerning sunscreen guidelines. EWG criticized the FDA for not having guidelines for sunscreen safety and efficacy. According to EWG, companies continue to profit by misleading consumers about the protection offered by their products. EWG urged FDA to publish a final rule for its August 2007 draft sunscreen guidelines. In its March 2, 2010, response, FDA stated that most sunscreen products are currently marketed under an over-the-counter drug monograph entitled “Sunscreen Drug Products for Over-the-Counter Human Use.” According to the letter, FDA received over 3,000 comments in response to its August 2007 draft sunscreen guidelines. FDA concludes its response by stating:

Although we understand your concern regarding the protracted nature of this process, we trust that you will appreciate the need for us to continue to fully investigate and evaluate new research and development for sunscreen products, permit adequate opportunity for public comment, and weigh all research and development fairly and with full input from FDA subject area experts as well as industry stakeholders and the American public.

Gold Nanoparticles as X-ray Contrast Agents for Damaged Bone Tissue

Fri, 12 Mar 2010 23:38:06 GMT

The accumulation of microdamage in bone has long been linked by physicians to increased risk of fractures in both physically active individuals and the elderly. The role of microdamage in bone fragility has not been well studied due to limited capabilities for detecting such damage. Current imaging techniques are, by their nature, invasive, destructive, time consuming (and thus expensive) and limited to the two dimensional.

In their paper "Preparation of functionalized gold nanoparticles as a targeted x-ray contrast agent for damaged bone tissue", Zhenyuan Zhang, Ryan D. Ross and Ryan K. Roeder, all of Notre Dame's Department of Aerospace and Mechanical Engineering, after determining that what was needed was "a deliverable, biocompatible and damage-specific x-ray contrast agent" and that the contrast agent "must be nanoscale in order to be delivered through vasculature to microcracks". Noting that gold nanoparticles had recently been studied as a vascular contrast agent, "exhibiting high x-ray attenuation, colloidal stability, and biocompatability" and that gold nanoparticles are readily synthesized and functionalized through surface adsorption of molecules with thiols or amines, Zhang et al conducted experiments successfully using gold nanoparticles as targeted x-ray contrast agents.

In their conclusions, Zhang et al noted that "Functionalized AU NPs are a promising candidate for a targeted x-ray contrast agent for damaged bone tissue". .

This is yet another example of the incorporation of nanoparticles to improve existing medical technology.

FCC Fine-Tunes 2-Way Radio Rules

Fri, 12 Mar 2010 22:09:30 GMT

Changes to technical rules affect licensing, frequency coordination

Those interested in the finer points of Private Land Mobile Radio (PLMR) and Wireless Medical Telemetry Service (WMTS) – you know who you are – should check out a recent FCC order addressing a grab-bag of Part 90 and Part 95 issues. [WARNING: Don’t try reading the order if you’re driving, operating heavy equipment, or performing any task requiring alertness.] Following up on a three-year-old proposal, the FCC has now:

exempted from required frequency coordination certain categories of Part 90 applications that do not threaten new interference, such those requesting CMRS-to-PLMR conversion, bandwidth reduction, lowered antenna height, or decreased power (Section 90.175);
removed channel restrictions and power limits for mobile repeaters below 450 MHz and power limits for handheld transmitters (Section 90.247);
clarified that state and local governments (as well as businesses) are eligible to use Industrial/Business Pool licenses for commercial activities and surveying (Section 90.35);
because the FCC no longer issues authorizations for systems with a station class of FB8T (temporary centralized trunked relay), clarified that stations currently classed as FB8T will be renewed as either FB2T (for private, internal systems) or FB6T (for for-profit private carriers) stations; and
prohibited registration of WMTS devices on portions of the 1427-1432 MHz band where they do not hold primary status, in order to protect WMTS devices from harmful interference not anticipated by healthcare facility personnel (Section 95.1111).

[OK, rinse down a couple of NoDoz with that Red Bull-laced triple shot espresso, splash some cold water on your face, take a deep breath, open a couple of windows, and read on.]

Additionally, the Commission is now seeking comment on these matters:

whether secondary WMTS operations should be permitted, and under what circumstances;
whether power limits for end-of-train (EOT) radios should be increased to allow better communication from the end of a train to the front;
whether distance analysis should be dropped as a method by which trunked system applicants can identify incumbent “affected licensees”, given that most applications for new centralized trunked systems now rely on a contour analysis;
whether certain trunked system applicants should have to show that their service contour will not be overlapped by an affected licensee’s interference contour;
whether to expand the definition of “affected licensee” based on spectral separation for certain trunked system applications;
how best to determine a mobile-only trunked system’s contours;
whether to continue to prohibit frequency coordinators from accepting a conflicting trunked system application for 60 days after notice of an application, given the prohibition on “greenmail” applications;
whether to codify in its rules the “TSB-88” interference criteria (published by the Telecommunications Industry Association and the Electronics Industry Association) for evaluating adjacent channel interference for the 12.5 kHz offset channels in the 470-512 MHz band; and
whether to allow digital signals for the transmission of station identification information for VHF and UFH PLMR licensees.

Yawn-inducing stuff to many, perhaps, but vital to those whose job it is to provide American businesses with reliable radio communications. We will let you know the comment due dates when they become available.

Quickhits: Federal Judge Dismiss Aetna Data Breach Case Due to Lack of "Injury-in-fact"

Fri, 12 Mar 2010 21:23:14 GMT

A Federal judge in the U.S. District Court for the Eastern District of Pennsylvania dismissed a class action lawsuit arising out of a data security breach involving Aetna, Inc. (original compliant found here). The basis of the dismissal was the plaintiff's lack of standing due to its failure to allege an "injury in fact" (the dismissal was under section 12(b)(1) of the Federal Rules of Civil Procedure). In particular the court held that the plaintiff's alleged injury in the form of an increased risk of identity theft is far too speculative based on the factual allegations.

The following quote cited by the court (from another case), is indicative of the court's reasoning:

[f]or plaintiff to suffer the injury and harm he alleges, many ‘if’s’ would have to come to pass. Assuming plaintiff’s allegation of security breach to be true, plaintiff alleges that he would be injured ‘if’ his personal information was compromised, and ‘if’ such information was obtained by an unauthorized third party, and ‘if’ his identity was stolen as a result, and ‘if’ the use of his stolen identity caused him harm. These multiple ‘if’s’ squarely place plaintiff’s claimed injury in the realm of the hypothetical. If a party were allowed to assert such remote and speculative claims to obtain federal court jurisdiction, the Supreme Court’s standing doctrine would be meaningless.

Note that the basis of this dismissal was not a "failure to state a claim" under 12(b)(6). Rather this decision basically held that the plaintiffs could not even get a hearing in court on a 12(b)(6) motion because the court lacked subject matter jurisdiction to hear the case at all. Also note that other courts have found standing for data breach cases, including the Seventh Circuit in Pisciotta. However, those that have proceeded past the 12(b)(2) motion have often been dismissed under 12(b)(6). In all, no matter how it happened, it appears that plaintiffs still have significant challenges moving consumer data breach cases further toward trial.

More commentary can be found here.

USF Contribution Factor - 15.3%

Fri, 12 Mar 2010 19:38:14 GMT

Today, the FCC released its proposed Universal Service contribution factor for the second quarter of 2010. As predicted, it is 15.3% The new rate will go into effect starting April 1, 2010.

lennyesq

Fri, 12 Mar 2010 18:24:47 GMT

Attention Members of the Northern District Bar – On Thursday, April 29, 2010 the Federal Court Bar Association and the Office of the Federal Public Defender and the New York State Defenders Association will be hosting a CLE program entitled “Federal Criminal Law Update”. The program will be held in Syracuse, new York at the [...]

There is no fee for this program; but registration is required. To register for this program and to view the program agenda, please visit the Court website:

http://www.nynd.uscourts.gov/UpcomingEvents.htm

Antidilution Nuances to Ingnore

blogs@foleyhoag.com (Foley Hoag) — Fri, 12 Mar 2010 17:09:54 GMT

There are a lot of little nuances that can come up in connection with term sheet negotiations. One of my clients recently brought one of the more irrational ones to my attention with a question about what is and what is not fully diluted.

It began with the cap table where the option pool first appears. When determining their investment and the pre and post money valuation, the investors assume the issuance in full of the entire option pool. Just to be clear, if the investors want 50% of the company, they mean after all options in the pool have been granted. (So, if you imagine that there will be 10 million shares outstanding after a financing and the VC expects to own 50%, then they will own 5 million shares and the other 5 million will be split among all other interests (the common and the option pool – among others).

Well, that is fine. After all, the valuation is the valuation. But what happens when it comes to calculating the weighted average antidilution? [There is a complex formula that I don’t want to go into in detail. Suffice it to say that the bigger the denominator the smaller the adjustment to the antidilution ratio.] For the purpose of the antidilution calculation the denominator includes all issued and outstanding shares (including those that could be issued upon the exercise of granted options. Note the use of the work “granted” as opposed to the entire pool. Something approaching 99% of all deals that have weighted average antidilution work with only granted options and therefore have their thumb on the scale in favor of the investor.

Now this is in many ways just a small (minute) point since the difference in the two calculations is likely to be minimal. So, in the grander scheme of things it isn’t worth much of an argument. Despite the seeming unfairness of this inconsistency, save your powder for bigger points.

Direct-to-Consumer Advertising: Have We Got a Deal for You!

Fri, 12 Mar 2010 16:33:12 GMT

Medicis Pharmaceutical, the maker of Dysport a drug approved by the US Food and Drug Administration (FDA) to smooth skin furrows between the eyebrows, recently introduced a marketing campaign that offers people who use Dysport drug discounts and a patient satisfaction rebate guarantee. The campaign, which runs through April 30, was intentionally designed to elevate Dysport’s image and cannibalize market share in the anti wrinkle market from Allergan the maker of Botox and the market leader.

The Dysport promotion, running on the product’s Web site and in a few glossy magazines like Us Weekly, offers a $75 rebate check on an initial Dysport treatment for wrinkles between the eyebrows, a procedure that can cost consumers $300 to $500. Satisfied customers can receive a $75 rebate on a follow-up Dysport treatment, while dissatisfied customers who want to switch can receive a $75 rebate on a Botox treatment.

While this is an unprecedented and novel campaign, it demonstrates the lengths that Medicis is willing to go through to garner market share from Botox which enjoyed a monopoly on injectable toxins in the US until the introduction of Dysport last year. Last year, worldwide sales of Botox were roughly $1.3 billion. Industry analysts estimate that Medicis may be able to capture a 20 to 25 percent share of the US market.

While the marketing campaign may seem a bit odd and brash, Medicis isn’t the first pharmaceutical company to use rebates and drug discounts to inspire patient brand loyalty. For example, Sepracor offers a seven-day free trial of its popular sleeping pill Lunesta. Merck is running a print ad with a voucher for a free 30-day supply of its Januvia tablets for Type 2 diabetes. Another Merck ad carries a $20 coupon for the allergy and asthma drug Singulair. However, the use of product rebates and drug discounts is mostly used to market so-called vanity medicine drugs (like Latisse, Botox and Dysport) which have been approved by FDA for clinical use but are not covered by medical insurance. Patients who use these drugs are paying out of pocket and, in essence, are buying from physicians. Many worry that this practice may induce doctors and patients to make medical decisions based on money not safety or efficacy.

In the case of Botox and Dysport neither product is entirely risk free. For those of you who may not know, both are purified forms of botulinum toxin — a toxin produced by Clostridium botulinum that interferes with nerve transmission and involuntary muscle contractions. The injections cause temporary cosmetic problems like droopy eyelids or uneven eyebrows. And these drugs now carry federally mandated “black box” warnings on their labels stating that botulinum toxins have been associated with rare but potentially life-threatening health problems.

Although promotional programs like the one being offered by Medicis may be inappropriate or seemingly reckless, it—like those of Sepracor and Merck—are permissible under current direct-to-consumer (DTC) advertising regulations. Isn’t it time to reevaluate regulations that allow powerful, potentially-dangerous prescription drugs to be treated as consumer goods where price, not medical need, safety or efficacy, promotes their acceptance and use?

Until next time...

Good Luck and Good Looking !!!!!!!!!!

Retransmission In Transition?

Fri, 12 Mar 2010 16:13:21 GMT

Consumer-friendly (?) Big Cable seeks Big Cable-friendly overhaul of retransmission consent process

A group consisting of some of the major multichannel video program distributors (MVPDs) has run to the Commission asking for changes in the retransmission consent rules. The group – for convenience, let’s refer to them collectively as “Big Cable”, although they include (in addition to major cable operators) non-cablers DirecTV, Dish, a couple of phone companies, and even some supposedly independent advocacy/think tank groups – is concerned that Big Cable’s ability to call the shots when it comes to carriage of broadcast signals has gone away, and Big Cable understandably wants it back. Who wouldn’t?

In a Petition for Rulemaking, Big Cable declares that the retransmission consent system is “broken”. Not surprisingly, Big Cable had this particular epiphany immediately after several very public sets of carriage negotiations in which, e.g., Fox and ABC demonstrated their negotiating acumen, and clout, in facing down some very major cable operators. Who “won” or who “lost” those negotiations is, of course, a matter of opinion and spin. But Big Cable is now urging the FCC to impose a mandatory arbitration process and to require that MVPDs continue to carry stations when parties can’t reach a deal.

Sure sounds like Big Cable may be thinking that, nowadays at least, the broadcaster-MVPD negotiation process isn’t exactly what it was cracked up to be . . . at least for Big Cable.

Way back when, in the misty eons of time prior to the Cable Act of 1992, broadcast stations got carried on cable systems pursuant to the “must-carry” rules. In rough terms, the cable systems had to carry local stations, and broadcasters had to allow such carriage. But with the 1992 Act, Congress started to coax the players into a more market-oriented arrangement. In addition to must-carry (which remained in place as an alternative), broadcast carriage could be agreed-to through “retransmission consent” arrangements privately negotiated between TV station and cable operator. The broadcaster had to elect which approach it would take in advance of the relevant three-year term. Those electing retransmission consent (or “retrans”, to the cognoscenti) were then left to cut whatever deal they could.

The advantage to the broadcaster was that, if it could negotiate a favorable deal under retrans, it could get compensation for carriage that, under must-carry, it was giving up for free. The downside, of course, was that a broadcaster electing retrans and then unable to tie down a deal risked losing out on any carriage during the three-year term. Bummer. (All parties to retrans negotiations were, and still are, required to deal in good faith. While accusing the other side of acting in bad faith is a standard ploy, to date such claims have not moved the Commission to interject itself into retrans dealings. Basically, it’s beyond difficult to establish that the other guy is negotiating in bad faith – and in its petition Big Cable pretty much concedes as much.)

In the early rounds, the cable companies held most, if not all, of the cards. Since they were all monopolies in their respective areas, they could avail themselves – usually successfully – of the tried-and-true negotiation position of “my way or the highway”. Broadcasters electing retrans usually ended up getting access to one or more additional cable channels and maybe some advertising avails and the like –whatever scraps the cable company chose to leave on the table – but no cash payments for their programming.

Then a funny thing happened over the course of the last 18 years or so. Competition crept into the MVPD industry, through satellite services (i.e., DirecTV and Dish) and telephone company offerings like FIOS. And while 200+ channels of non-broadcast programming may sound tempting, the viewing public still demonstrated an abiding affection for local TV stations. This happy confluence of trends was good news for broadcasters. Not so much for Big Cable.

Fast forward to New Year’s Eve, 2009, when a negotiating impasse between Fox and Time-Warner (one of the Big Cable team) splashed across the headlines and threatened to deprive millions of viewers of Fox’s New Years Day programming (can you spell “BCS”?). A couple of months later, ABC went mano-a-mano with Cablevision in the NYC market, cutting off carriage of the Oscars® for the first 13 minutes of the show before a deal was struck and the show went on.

And two days after the Oscars® face-off, who shows up at the FCC but Big Cable, petition for rulemaking in hand.

According to Big Cable, the retrans system has unduly favored broadcasters from Day One. The only reason Congress adopted the retransmission consent/must carry regime, so their story goes, was to prevent then-dominant cable systems from undermining free over-the-air broadcasting by exercising the market power that their monopoly positions afforded cable operators. They seem to think that, because broadcasters have gradually attained a more robust bargaining position, it’s time to have the guv’mint control the parties’ relationships.

In its Petition Big Cable acknowledges that in the early days of retransmission consent, cable systems were able to deflect paying cash compensation by agreeing to provide “in-kind” compensation – e.g.,agreeing to carry other non-broadcast programming channels in return for the right to carry the primary broadcast signal. Now that broadcasters are negotiating for cash compensation, however, Big Cable says that they and their MVPD confrères are (horror of horrors!) being forced to either (a) pay the broadcasters and pass those costs along to consumers, or (b) run the risk of having to remove the broadcasters’ programming from their systems. And, according to Big Cable, broadcasters have taken to making unreasonable demands on cable and satellite operators. (Here, Big Cable bemoans the fact that the “good faith” negotiation requirement is so vague that MVPDs have not been able to show that broadcasters’ demands have ever constituted “bad faith” negotiating tactics. Go figure.)

To “reform” the system, Big Cable advances a number of proposals that would shift the balance of power back more in Big Cable’s direction. Here are the main ones:

First, the Commission should establish a mandatory dispute resolution system for retransmission consent negotiations, to bail out MVPD operators who find themselves unable to persuade the broadcaster that the offer on the table really should be acceptable to the broadcaster. This system would come into play not just on a showing of broadcaster bad faith (remember, that’s too difficult to prove), but any time a cable or satellite operator claims that the parties cannot reach an agreement. Once the dispute resolution process was invoked, the appropriate compensation level would be established by arbitrators or some type of expert panel – not through direct negotiation between the parties.

Second, the new regime would effectively prohibit a broadcaster from demanding carriage of other programming services in return for the right to carry a broadcast signal by making such a demand a per se violation of the “good faith” negotiation requirement. Of course, Big Cable magnanimously suggests that the FCC should allow such arrangements, but only if the MVPD consents to them. That is, such an arrangement would be per se “bad faith” only if the MVPD didn’t like it.

Third, the Commission should impose an “interim” and continuing grant of retransmission consent for as long as (a) the MVPD continues to negotiate in good faith and/or (b) any dispute resolution process is ongoing. Adding that condition of “good faith” negotiation is interesting in view of Big Cable’s acknowledgement that it’s virtually impossible to establish that a party is negotiating in bad faith. So let’s get this straight. If the MVPD and broadcaster are negotiating, the MVPD gets to carry the broadcaster’s programming unless the MVPD is negotiating in bad faith, which is a showing everybody agrees can’t be made – so the MVPD gets to carry the programming. And if the negotiations reach an impasse (according to the MVPD), the only alternative is the mandatory and binding arbitration process – during which, again, the MVPD gets to keep carrying the programming. It would only be after the failure of both private negotiations and mandatory arbitration that a broadcaster could ever exercise its rights to prevent retransmission of its signals. It is unclear, however, how an arbitration process that is both mandatory and binding could ever fail.

The Big Cable proposals are stunning in their one-sidedness. The broadcasters and MVPDs will negotiate – until the MVPDs decide the negotiations are at an impasse and demands arbitration. A broadcaster seeking carriage of additional non-broadcast programming is automatically acting in bad faith – unless the MVPD agrees to it. A broadcaster must extend its retrans consent until a deal is reached – and reaching a deal is mandatory.

And while Big Cable tries to depict itself as really just looking out for the consumer, it’s not at all clear that that self-serving claim withstands scrutiny. Big Cable’s claim is that, if MVPDs are forced (through the retrans negotiation process) to pay broadcasters for carriage, then those additional costs will be heaped on the broken and bleeding backs of the consumers, who will have to pay more to the MVPDs in order to watch broadcast fare. But who said that the cost of carriage has to be passed through to the consumer? Are MVPD profit margins so low that Big Cable can’t absorb those additional costs and still make a tidy profit? Serious attention should be paid to such questions before anybody swallows the “poor little consumer” claims of Big Cable.

More fundamentally, the Big Cable proposal would transform the retrans consent bargaining process from a free market negotiation to a mandatory and binding arbitration, making it effectively impossible for a broadcaster ever to prevent a cable operator from retransmitting its signals.

It’s as if, back in 1992, Big Cable had agreed to play an ostensibly fair game of coin toss with broadcasters – but, because of cable’s then monopoly-based dominance, it was akin to playing with a two-headed coin, making it easy for Big Cable to win the toss each time. And now, 20 years or so into the game, with the two-headed coin removed and a more competitive normal coin put into play, Big Cable is saying that it’s happy to keep playing as long as the rules are tweaked ever so slightly to provide them with a “heads I win, tails you lose” option.

Big Cable has not limited its push to the Commission. Cable and satellite operators have also gone to Congress, sending a letter raising many of the same points to the House and Senate Commerce Committees. In response, the NAB has fired back with its own letter to those committees.

This is a fist fight that would ordinarily last some time, particularly because the Commission can be expected to be distracted from mundane mass media matters by its current preoccupation – nay, all-consuming obsession – for broadband issues uber alles. But in Congressional testimony on March 11, Chairman Genachowski said that the issue of the retrans consent process “is a subject that should be looked at seriously . . . for a framework that works for consumers.” Uh-oh. Cable’s play of the consumer card, heavy-handed and disingenuous though it may seem to many, may be the equivalent of Tinker Bell’s fairy dust which, when liberally sprinkled here and there, can cause otherwise flightless things to take wing. We shall see.

[Blogmeister’s Credit Report: This post is the cooperative effort of Dan Kirkpatrick, Jeff Gee and Harry Cole.]

PKF Texas - Entrepreneur's Playbook®:Planning Ahead for the Blended Workforce

GregsHead@pkftexas.com (Greg Price) — Fri, 12 Mar 2010 14:00:53 GMT

Note: Running Fridays in FromGregsHead.com, is a continuing series of tips brought to you by Greg Price. These run Saturday mornings during the BusinessMaker’s Radio Show on KPRC 950AM. Audio files can be found on the PKF Texas - Entrepreneur's Playbook® page of the PKF Texas website.

In a recent study on the Blended Workforce, I noted some challenges that lay ahead. Information technology can help people and organizations bridge the divides of age, work style, distance and nationality. IT can also enable the blended workforce to add value through improved relationships with customers, partners, and talent pools to reduce costs by identifying new efficieniencies and adding value through innovation in processes, products, and services. In this study, Microsoft suggests that information technology plays a role in the following three important areas:

Knowledge management. Enabling the retention and transfer of explicit and tacit knowledge across generations, cultures and organizational boundaries.

Mobility and virtual workforce management. Extending the capabilities and protections of the enterprise and its data resources to people, anywhere, anytime.

Collaboration and coordination. Reducing virtual distances, thereby facilitating well-managed teamwork, and bringing partners into critical processes.

In this edition of the Playbook, I will focus on only one area, Knowledge Management. Older works have knowledge gained from years of on the job experience. But companies cannot afford to keep these senior personnel on staff with escalating salaries. The development of knowledge systems and knowledge networks will become a priority. Today we use Blogs, Wikis, RSS and other tools to stay up to date. Today, I see that Facebook is allowing me to stay in touch with over a dozen communities at a time. This tool and LinkedIn are just two support tools I use daily. And finally, you need to encourage all personnel of all ages to as we say “play well with others”, by encouraging and rewarding learning processes.

ERP Implementation Strategies

Fri, 12 Mar 2010 13:32:44 GMT

Houston Neal, Director of Marketing at Software Advice, is conducting a survey on ERP implementation strategies. Specifically, which implementation strategy (big bang, phased rollout, or parallel adoption) has the best success rate.

You can find the survey in his article entitled ERP Implementation Strategies – A Guide to ERP Implementation Methodology.

Latest TJX Breach Lesson: Crime Does Not Pay

Fri, 12 Mar 2010 11:44:04 GMT

A co-conspirator in the TJX breach, Humza Zaman, saw the next 46 months of his life laid out before him in Boston yesterday, as he was sentenced in federal court for his role in the TJX breach. He was also fined $75,000.

Zaman’s role appears to be limited to money laundering activity while he was employed by Barclay’s Bank. Zaman, apparently feeling he was only doing favors for Albert Gonzalez (by all accounts, the mastermind behind the data theft), would meet and mule large amounts of cash that he received from “an unknown man of apparent Eastern European descent.”

The writer of the “sniffer” computer program that was used in the data theft, Stephen Watt, was sentenced last April to three years of supervised release. Mr. Watt must disclose his conviction to future employers, but he will not be prevented from using computers.

~~Lex Luther~~ Albert Gonzalez is awaiting sentencing and faces a minimum sentence of 17 years in prison.

Wired has a much more thorough reporting of the prosecution side of the TJX breach, which is worth a read by not only business folks, but people that may get drawn into similar schemes.

When the Cat’s Away…

KMAdvice@gmail.com (Mary Abraham) — Fri, 12 Mar 2010 11:00:33 GMT

When the cat’s away, you know what those mice do. But, do you know why? According to a report by Rachel Zupek, it’s often about the kind of boss that cat is: It’s a direct reflection of the boss’s leadership. When a workplace isn’t compelling to people — where employees lack the desire and ability [...]

When the cat’s away, you know what those mice do. But, do you know why? According to a report by Rachel Zupek, it’s often about the kind of boss that cat is:

It’s a direct reflection of the boss’s leadership. When a workplace isn’t compelling to people — where employees lack the desire and ability to be accountable for their own success — misbehaving or slacking in the boss’s absence is merely a mask for boredom.

If a lack of employee engagement is a consequence of supervisor behavior, then that’s important feedback for the boss. Accountability expert, Linda Galindo, believes that bosses in this situation need to”raise their game.” This can mean adopting a radically different approach to management, as recounted by one supermarket manager:

Not content with the absolute misery of the hourly employees I was responsible for, I tried to inspire and entertain them. It worked; those under me had the highest productivity rate, got the best raises, were promoted faster and would do just about anything in the world for me because they knew I would do anything in my power for them.

For you cats in management, is there something about your leadership that stops your colleagues from investing in their jobs and the success of your group? Are you focusing on the right things? Is it about punching the clock on time — or producing great results on time? Is it about providing a way for your staff to shine — or are you too busy promoting your own interests over those of your team?

Perhaps mice are predisposed to play a little when the cat’s away. Just be sure that you aren’t creating the conditions at work that drive your mice to act out more than normal.

[Photo Credit: yukari]

Model Seed Funding Doc Myths

info@ryanrobertslaw.com (Ryan Roberts) — Fri, 12 Mar 2010 01:51:36 GMT

A variety of model startup seed funding docs have been released in the past year or so: TechStars Series AA Preferred, YCombinator Series AA Preferred, and TheFunded Founder Institute’s Plain Preferred. And as I mentioned last week, Fenwick & West and Andreessen Horowitz released the Series Seed model documents. The standardized seed funding [...]

The standardized seed funding document movement is great and I fully support it.

So now you have more docs to choose from, and maybe more to be confused by. I have and will continue to use these document sets when a client requests. But there are a few myths about standardized seed funding docs, both in terms of their use and their effect on the legal landscape:

Myth #1: Startup Lawyers Hate Standardized Seed Funding Documents Because it Reduces their own Payday.

The premise here is simple: complicated/long docs = $$$ for lawyers.

But lawyers don’t make documents complicated to pad the bill. Legal documents can get “complicated” because of the potential issues that may arise pre- and post-transaction. If these issues didn’t actually happen, the documents wouldn’t be longer or more complicated.

For example, a founder stock purchase agreement is 12+ pages long because founders can, have, and will fail and/or bail on startups (hence the vesting schedule & startup repurchase option). When an issue like this occurs at your startup, you’ll be glad your documents are “complicated.”

Each time a new set of docs get released, I don’t cringe because it means I then have to remove the hockey stick from my revenue projections. I welcome these and future standardized seed funding docs because they provide entrepreneurs with the chance to take a look financing terms. And since the model seed funding documents aren’t as cumbersome as those used in a typical Series A Round, I find that entrepreneurs tend to actually review them. Clients come better prepared now.

An educated entrepreneur is a better entrepreneur. And better entrepreneurs build more successful startups. Startup lawyers (myself definitely included) take the long-term view and want to see our clients succeed.

(Note: If you believe your lawyer is making documents complicated and long for the sake of his or her payday, ask your lawyer about the documents and the need for their complexity/length. If your lawyer’s answer isn’t good enough for you, then find a new lawyer. Of course, you can also ask for fixed-fee billing.)

Myth #2: Standardized Docs Reduce the Need for a Startup Lawyer

This myth is usually offered by someone who thinks lawyers are just gatekeepers of the legal document vault. There is no “walled garden” when it comes to legal documents. You can easily get legal documents via Lexis, Westlaw, Edgar, or any relevant legal treatise.

If you believe lawyers are simply document gatekeepers, you are missing the entire reason for hiring a lawyer — counsel. If you aren’t asking for counsel, you aren’t using your lawyer right. If your lawyer isn’t providing counsel, you have the wrong lawyer.

No set of seed funding documents will replace counsel, either pre-financing or post-financing. But in the event one of you genius hackers does this, please consider me for a job at your startup.

Myth #3: Standardized Docs = Open Source Law.

“Open Source Law” is a buzz phrase thrown around frequently, but what the legal profession is experiencing is more of an automation of various parts of the law practice….not the entire practice of law. There will always be demand for good counsel.

While the practice of startup law isn’t rocket science, it is nevertheless complex. In addition to understanding the provisions of your particular agreement, you have to know (i) what is missing from the agreement, and (ii) how the various provisions, situations, people, and investment amounts interact and may affect other off-document rules and issues. It’s difficult to do this unless you do this frequently.

Law firms are no more immune to open sourcing than any developer, engineer, or pixel pusher. But it doesn’t mean we’ll all go away, we’ll just adapt by providing more value. Those that manage this feat will survive.

Myth #4: Standardized Seed Docs are Appropriate for My Startup’s Raise.

First, most if not all the model seed docs assume your startup is a Delaware corporation. Thus, you are going to have to either edit the docs or reincorporate your startup in Delaware to use them properly. (Next up: the model reincorporation merger kit)

Second, the model seed docs tend to impress upon the entrepreneur that preferred equity is the best angel investment structure. That may be so, but convertible debt can also be appropriate for you startup’s angel round.

However, most (all?) sophisticated investors will not invest via a convertible note. And since the people & groups behind these model seed funding docs are some of the most sophisticated angel investors in the world, preferred equity investment model docs are being released.

Since entrepreneurs trust groups like TechStars and YCombinator, there is the tendency for startups to blindly use these docs, without considering alternatives like convertible debt. To their credit, these groups have earned entrepreneurs’ trust and have altruistic reasons for their release. Nor do they push these docs as “must use” docs.

Nevertheless, entrepreneurs should still consider whether a model seed funding document set (preferred equity) is prudent relative to their startup’s situation.

Conclusion

I support any effort to bring transparency to the law firm establishment and otherwise educate entrepreneurs (including model seed funding documents). That’s one of the reasons why I started this blog in 2006. You can’t be a startup lawyer and not want startups to have a better chance at succeeding. Model seed funding docs help entrepreneurs, but not to the detriment of startup lawyers.

Idealist.org Career Resource on Public Interest Law

Thu, 11 Mar 2010 23:13:52 GMT

As part of its Public Service Graduate Education Resource Center, Idealist.org has developed an excellent resource for prospective graduate students contemplating a career in public interest law. Available as a downloadable PDF, it provides a wealth of information on what to look for in a law school, the law school application process, possible career paths, and the challenges facing public interest lawyers after they graduate. -M

European Parliament has principles

scrawford@scrawford.net (Susan Crawford) — Thu, 11 Mar 2010 23:00:48 GMT

The overwhelming vote in the European Parliament this week - 663-13! - to oppose the secretly-negotiated Anti-Counterfeiting and Trade Agreement was striking. They’re calling for the text to be revealed, and they’re not happy about making ISPs introduce “US-style draconian ways” to punish misbehaving subscribers. According to Wired, the Parliament isn’t saying that there shouldn’t be [...]

According to Wired, the Parliament isn’t saying that there shouldn’t be a treaty covering counterfeiting. But the text of the proposed treaty should be public, and if it requires ISPs to punish Internet users the Parliament will oppose it.

The US has refused to reveal the text of the treaty on national security and other grounds, citing its need to work with other government representatives on a confidential basis before the treaty is finalized. (Interesting interview with Michael Geist, the cyberlawyer of Canada, here.) Public interest groups in the US have been allowed to see the text - but only if they agree not to tell anyone about what they’ve read.

There’s a good deal of confusion about what the text of the treaty actually says. There’s also a great deal of concern about what it could do to harm users’ rights and interests. Is it a global DMCA? Does it mandate a global “three strikes” regime?

The cloak of secrecy that the US has flung over the ACTA proceedings has only served to make free-flow-of-information fans around the world more anxious. Now the European Parliament has put a heavy foot down. It’s good to see principled parliamentarians worried about civil liberties, and unfortunate that American interests are being presented in such a one-sided way.

Navigating Public Policy: NanoBusiness Alliance's 9th Annual Washington D.C. Roundtable

Thu, 11 Mar 2010 21:37:33 GMT

The 9th Annual Washington D.C. Roundtable, the official public policy forum of the NanoBusiness Alliance, will take place on March 15 - 17, 2010, with informative legislative meetings as well as networking among nanotechnology industry leaders. In particular, the March 17th Federal Roundtable...

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