That is what a 3 judge panel of the first District Court of Appeals just did in the case of Comast vs FCC. The Panel offered the ruling as memorandum, not binding, but telegraphing the Courts observations and if affirmed by the full bench sets the FCC on its ear. –

Federal appeals court gave notice Friday it likely would reject the Federal Communications Commission’s authority to sanction Comcast for throttling peer-to-peer applications.

The U.S. Court of Appeals for the District of Columbia Circuit suggested as much during oral arguments with the FCC and Comcast. The Philadelphia-based cable concern is appealing the agency’s 2008 decision ordering it to stop hampering the peer-to-peer service BitTorrent as a traffic-management practice.

The order was in response to complaints Comcast was sending fake signals to users of BitTorrent, a bandwidth-heavy protocol often used to pirate copyright content.

“You have yet to identify a specific statute,” Judge Raymond Randolph told an FCC lawyer regarding the legal authority to ding Comcast.

To be sure, Friday’s reaction to the appellate court hearing made it increasingly clear the Obama administration’s FCC has been preparing for a defeat concerning net neutrality (.pdf), one of the largest issues surrounding internet freedom.

The upshot of this memo? —

* Net Neutrality as it has been proposed since Chairman Martin’s tenure may not survive in its current form if it survives at all.

* That the FCC may not even have the authority to regulate in this area as no controlling regulatory clause has been found by the court.

* That the 30% rule fostered by the FCC on the cable industry is willful and capricious. The panel summarily vacated that baseline without standing in current rule making by the FCC itself.

* Has political implications beyond the scope of this blog.

In many ways we are right back to 2004 in regards to carriers regard to traffic management, FCC’s role in this issue and the very nature of Net Neutrality.

Linky.
Full Finding here.

BlueHippo had sought bankruptcy reorganization protection last month when its payment processor’s bank unexpectedly blocked its funds, leaving the company unable to pay creditors. BlueHippo petitioned a Delaware bankruptcy court judge to allow the funds to be released to the company, but its request was denied on Dec. 2, according to court records.

Without access to the funds held by Checkgateway LLC, BlueHippo “will not be able to satisfy administrative expenses that will continue to accrue if these cases are maintained in Chapter 11 [reorganization],” according to the filing. The company has a bankruptcy court hearing on its Chapter 7 motion on Dec. 23.

With that the Blue Hippo seems on its last legs. We have cautioned about being involved with this firm in the past. The world for most of us will be a better place without them.

Link

The original copyright law was a compromise that enabled the creators of duplicatable works to earn from their latest work long enough to create their next while allowing fair use of works a few years older. The system worked admirably well until mega media companies arrived on the scene and started meddling with it via the Washington lobby. It was never intended to enable the accumulation of duplicatable works as assets that would earn eternal royalties for those who create nothing. As these entities grew, they have often made distribution deals with artists that stripped the artists of the rights to their own works. Copyright laws had devolved to support this business model, and left artists little recourse when they surrendered copyrights to big music. The pendulum has swung in the opposite direction. A new law may enable artists to reclaim their copyrights. It’s a sure bet the congress is going to enjoy some heavy handed lobbying from big music in the coming year. Will musicians fare better? They could. It’s absolutely certain that copyright lawyers will be having a very good year.

There’s been a lot of attention recently to the news that the heirs of comic book artist Jack Kirby are alerting companies of plans to take back the copyright on various Kirby characters, using the termination rights in the Copyright Act. This followed a very long and drawn out lawsuit involving a similar attempt over Superman. The details are really complex, but copyright law allows the original creator (or heirs if that creator has passed away) certain opportunities to basically negate a deal that was signed early on to hand over the copyright on certain works. The idea was to help protect artists who signed bad deals, but in practice, it’s just been a total mess.

Still, given the success of the Superman saga in getting at least some of the copyrights back, suddenly lots of people are looking to see what other copyrights can be reclaimed. Apparently, a bunch of musicians are now lining up to try to regain their rights from the labels starting in 2013 (the first year musical works are eligible). As the article notes, with record labels still too clueless to figure out how to successfully build business models around new acts, many still rely on sales of old music to bring in a lot of their revenue. If the labels lose the copyrights on much of that music… well… let’s just say suddenly The Pirate Bay may be the least of their concerns. (Techdirt)

This is a little off the beaten track for this blog. But it does bring up some interesting perspectives vis a vis the Internet —

Austin Police Chief Art Acevedo says he and some of his officers have been harassed, lied about and had their identities falsely used in online blogs and in reader comment sections on local media Internet sites.

They’ve had enough.

In a meeting this month with department brass, Acevedo and the group discussed how they think such posts erode public trust in the department and how they have been wrongly maligned.

They have since researched their legal options and decided that from now on, they might launch formal investigations into such posts, Acevedo said. He said investigators might seek search warrants or subpoenas from judges to learn the identities of the authors — he thinks some could be department employees — and possibly sue them for libel or file charges if investigators think a crime was committed.

“A lot of my people feel it is time to take these people on,” Acevedo said. “They understand the damage to the organization, and quite frankly, when people are willfully misleading and lying, they are pretty much cowards anyway because they are doing so under the cloak of anonymity.”

So lets take the obvious on shall we? Brick Brac’s online usually indicate a more invective problem inside the organization. In a sense HR 101. You have some employees that think they have been treated unfairly and have no formal means to complain, whether true or not. Maybe they have a supervisor whose a tough nut. Does not matter, the aggrieved party will seek alternate means of venting. Today that is often the Internet. So the postings on the Internet are the symptom not the disease. So the chief might want to get out from behind the desk and do some management by walking around. He might pick up on the vibes from the rank and file. It is the only way to bypass the middle management filter.

As to going after posters. Well go for it, but it is probably not going to be as productive as you expect. ISP’s don’t have to give you ID’s unless you can show they are part of a criminal action. You have to show cause which is tough on the ‘Net. Then even when you have that, once you get to court you would have to show malice and fore thought on the part of the poster. Harder yet to prove. Then even after you go through all that effort, if it is an employee, think of the morale downer that will be once the grapevine spreads it around.

My last question to the Chief is do you apply the same standards to the Press if they use anonymity? Its one of their stock in trade techniques. Would you consider it appropriate to take equal action against say the Statesman? If you would not, then what is your differentiator? The Press has no more privileges that a private citizen has.

You guys have a tough job just like any other PD. People telling lies makes the job harder for sure. But people have been doing that long before the Internet came along. You will only win however if in your search for the source(s), having found them, dig deeper for the cause. Especially if it turns out to be an employee.

In fairness, Chief if you want rebuttal, we will make it available.

A judge has given one of the least customer oriented monopolies in the country the to OK to get bigger. No strings attached.

Comcast Corp., the biggest U.S. cable-television provider, won a legal victory as a court threw out a rule limiting cable companies to 30 percent of the market.

The Federal Communications Commission failed to fully consider competition from companies such as DirecTV Group Inc. and Dish Network Corp., the U.S. Court of Appeals in Washington said. It called the FCC’s action “arbitrary and capricious” and vacated the rule.

The ruling could spell an end to FCC attempts to limit the growth of cable companies, said Andrew Lipman, a Washington- based attorney. The court didn’t offer the agency a chance to provide better reasons for the rule, as it did when judges rejected the limit in 2001, Lipman said in an interview. (Bloomberg)

Don’t look for Comcast to go searching for new, underserved and unserved markets. The company has grown entirely through acquisition.  With the sputtering economy, many smaller operators will sell for historically low prices. For that reason, the timing of this ruling can’t be entirely coincidental. What really troubles me is that all of the discussion I’ve seen on this case focuses entirely on pay TV.  Closed system pay TV is in need of some of  Obama’s end of life counseling. The real issue is internet access. Letting the biggest and baddest of the cable guys control more than 30% of the cable internet with no provision to enable new competition isn’t just a bad idea. It’s criminal!

In what I think the MPAA and RIAA industry insiders will regret, the cat kinda slipped out of the bag. The DRM mavens don’t think you should have forever use of your copyrighted works you paid for. –

“We reject the view,” he writes in a letter to the top legal advisor at the Copyright Office, “that copyright owners and their licensees are required to provide consumers with perpetual access to creative works. No other product or service providers are held to such lofty standards. No one expects computers or other electronics devices to work properly in perpetuity, and there is no reason that any particular mode of distributing copyrighted works should be required to do so.”

Now here is the sham of that argument. First of all I DO expect a motherboard on a computer to work for the lifecycle of the product. Which in most cases is not hard to see 10 years go by. (I have seen some, like a few Bell 3b2’s and PDP-8’s approaching 40yrs of life.) The problem for the MPAA/RIAA type is that they deal in expressions not a container. That is the essence of a copyright.

Why is that different? Well lets say you bought the cassette version of Neil Diamond’s ‘Stones’ album from back in the 70’s. Now lets say you did the same in 1995 because you wanted it in CD format and Wally World had in in the $2.99 bargain bin. The cassette and CD are different ‘containers’ but the expressions in form of music is the expression. So lets say your original version of the cassette wore out. So you copy the tracks off the CD to a new cassette. You’re covered right? Not in the eyes of the RIAA. They would say you infringed and should have bought a cassette version (good luck one has not been available for a decade.)

Here’s where the RIAA/MPAA argument falls apart. How would the RIAA sue you? They will make the argument in court you stole the expression that represents the content and denied the artist revenue. Yet they will for economic purposes maintain the container is the thing and is what they protect. Sorry you can’t have it both ways. Copyright is about the expression.

I would take one more step, vis a vis the hard goods comparison. Suits, you knew going in that this was the lay of the land legally in regards to content. If you don’t like those rules then find a new line of work more suited to the hard goods - patent mindset. Live with it.

Linky.

If there was ever any doubt that the fix is in to continue letting telcos have their way with us, there’s a little new proof. An appeals court decision in favor of AT&T and the rest of the fixed line mafia keeps it to hold it’s exclusive right of way and charge whatever it likes for access to competitors. That’s kind of like allowing you local highway department to operate trucks and hit competing truck operators with a surcharge on top of road taxes for using on the same streets.

Regulators acted reasonably in freeing AT&T Inc. and other carriers from some rules governing how they sell high-speed data services to competitors and other businesses, an appeals court ruled.

The Federal Communications Commission wasn’t arbitrary when it decided that the carriers who provide “last mile” broadband services for business customers should be subject to only common-carrier regulations, the U.S. Court of Appeals in Washington ruled.

The ruling is “an important legal victory” for AT&T, CenturyTel Inc., and Frontier Communications Corp., said Rebecca Arbogast and David Kaut, Washington-based analysts at Stifel Nicolaus & Co., in a note.

The FCC decision preserved by today’s ruling gives the companies greater leverage to demand favorable terms and conditions from competitors such as Littleton, Colorado-based TW Telecom and Herndon, Virginia-based XO Holdings Inc., Kaut and Arbogast wrote. (Bloomberg)

Conclusion: It’s time to abandon all hope in fixing anything at the federal level. In fact that hope and change many voted for has evolved into into hoping we don’t have to endure more change that is only making things worse.

No I’m not clowning around. The nation’s bureau of ambulance chasing has decided to see if telcos have abused their duopoly positions to squash competition:

The U.S. Justice Department has begun looking at big telecom companies to try to determine if they have abused their market power, the Wall Street Journal reported in its online edition on Monday.

The journal, which cited people familiar with the matter, said the Antitrust Division’s review was in its very early stages and was not a formal probe of any specific company. (Yahoo)

The non-competitive actions of the fixed line duopoly and wireless cartel should have been an easy target for any ambitious prosecutor. In fact, only a deeply entrenched political will to thwart any study of bad duopoly behavior could have prevented it for so long. This leads me to believe that the probe will be a staged event to provide a platform for a little political show boating. If that’s the case very little will change. It could also be a precursor to a shake down, but we’re certain that the AG is above that kind of behavior. Having said that, I hope I’m wrong. I’ll be the first to sing the prases of any Justice department that will actually undo the duopoly stranglehold.

Update: We’re now hearing this could involve going after AT&T over iPhone exclusivity. That deal serves both AT&T and Apple’s walled gardens. Watch DOJ beat on AT&T while Apple goes unscathed. Show boating indeed.

The asshats at ASCAP are now making waves that ringtones are derivative works of commercial art and therefore due an payable. Why this is a scam after the jump –

Internet watchdog Electronic Frontier Foundation has hit out at a US music royalties collector, accusing it of making “outlandish copyright claims” about mobile phone ringtones.

The American Society of Composer, Authors and Publishers (ASCAP) filed a lawsuit against telecoms giant AT&T, in which it told a federal court that ringtones fell under the public perfomance Copyright Act.

ASCAP collects royalties and licences on behalf of 350,000 members in the US.

In effect, the organisation is gunning for additional payments from mobile firms, and if they don’t cough up the royalties ASCAP could claim copyright infringement against mobile users, according to the EFF.

The lobby group responded by filing an amicus brief* for the case earlier this week in the US District Court for the Southern District of New York.

The brief, which was also joined by the Center for Democracy and Technology and Public Knowledge, urged the federal court to reject what the EFF described as “bogus copyright claims… that could raise costs for consumers, jeopardise consumer rights, and curtail new technological innovation”.

Here’s the clue this is a con job. The threat that ASCAP is throwing around is that they will go after the carriers customers. BUT, they won’t if the likes of AT&T, Verizon and Sprint pay up for them. This is the typical lawyer trick. Don’t go after the violator, go after the peripheral player in the affair that possess deep pockets. Always go after the deep pockets is the lawyers choice. That is the tip off this is a legal scam.

Linky.

eBay’s plan to spin off Skype with an initial public offering in 2010 is being threatened by a dispute with the VoIP service’s co-founders, who still own a key part of the software.

Bloomberg reports Skype’s founders Niklas Zennstrom and Janus Friis have accused eBay of breaching a licensing deal and are threatening to yank the technology, which would disable the popular voice over internet service.

In return, eBay is suing Joltid, the company operated by Skype’s founders, in a London court to prevent the shutdown.

The Skype founders apparently retained the service’s peer-to-peer sharing technology when they sold to eBay for $2.6bn in 2005. (Which, of course, begs the question why eBay would pay all that money without ensuring they own the entire platform).

Well smart business people always work to sell the cow but license the right to the milk it produces. That appears to be what is happening here with a legal scuffle between Skype founders and eBay. So when Meg Whitman, who was the CEO that brokered that deal, plunk down the money she did not read the fine print on what she was really buying? Certainly appears that way regardless of the outcome of the lawsuit.

Would be a real blow to eBay if they lose. The value of the Skype property that they are trying to spin off would be worth less if the buyer has to pay royalities to the two gents owning the technology. Any buyer worth their salt would know this and only pay accordingly. For what they would really be buying is just the customer accounts and IT infrastructure.

There are still some fun things to watch in the IT biz.

Linky.