Privacy, Business and Law

On October 7, the Australian Securities and Investments Commission announced that it has obtained final Supreme Court injunctions against Netlink Hospitality Australia Pty Limited, Netlink Australia Pty Limited and Mirko Detlev Petrick. The injunctions prohibit the defendants from, among other things, offering securities over the Internet for their venture involving the manufacture and installation of Internet-ready computers in hotel rooms.

On October 5, the U.S. Securities and Exchange Commission approved a plan by the New York Stock Exchange to lower the fees that it charges brokers for real-time stock quotes. Interestingly, discount broker Charles Schwab provided comments on the proposal stating that the overall fee structure “is not fair and reasonable because the fees charged are unrelated to the actual costs of providing the market information.” Thus, Schwab argued, the fee structure overprices quotes and violates Section 11A of the 1934 Securities Exchange Act. In its release approving the proposal, the SEC stated that it will issue a concept release addressing such fees. According to one news report, “[a]mong the issues to be addressed in the forthcoming release are the discriminatory impact of the . . . fee structure on on-line investors–and the appropriate standard to be applied in assessing the fairness and reasonableness of market information fees.” News – New York Stock Exchange: SEC Approves Plan to Lower Fees For Access to NYSE Real-Time Quotes, Sec. Law Daily (BNA), Oct. 12, 1999. See also SEC News Digest 99-194 (Oct. 7, 1999) <http://www.sec.gov/news/digests/10-07.txt> (scroll down to “Approval of the Proposed Amendments to the Consolidated Tape Association Plan and the Consolidated Quotation Plan”).

On October 4, the SEC filed a motion seeking a contempt citation against defendant Clealon Mann in SEC v. Capital Acquisitions, Inc., Somerset Group, Inc., Wayne Notwell and Clealon Mann, Civ. Action No. 2:97CV-0977S (D. UT, complaint filed Dec. 23, 1997). The SEC alleges that the defendant violated an asset freeze entered in the case by trying to sell stock owned by a company that he controls which is a relief defendant in the case. The SEC’s original complaint in the action alleged that Capital Acquisitions, Inc. raised $20 million from at least 600 investors in an oil and gas drilling venture described as a “ponzi scheme” by the SEC. The scheme allegedly was discovered by the SEC when one of the venture’s sales agents, directed by defendants Somerset Group and Clealon Mann, “posted the offering on the Internet which led to its detection by the Commission’s Internet Surveillance Program.” For more about the SEC’s motion seeking a contempt citation against Mann, see SEC Litig. Rel. No. 16329 (Oct. 5, 1999) <http://www.sec.gov/enforce/litigrel/lr16329.htm>; SEC News Digest Issue 99-193 (Oct. 6, 1999) <http://www.sec.gov/news/digests/10-06.txt> (scroll down to “Contempt Citation Sought Against Capital Acquisitions, Inc. [sic]“); Federal News – Antifraud: SEC Says Ponzi Defendant Violated Asset Freeze; Seeks Contempt Citation, 31(40) Sec. Reg. & Law Rep. (BNA) 1370 (Oct. 15, 1999).

On September 28, the Honorable Wayne R. Andersen of the United States District Court for the Northern District of Illinois issued a landmark ruling in the seminal case of Commodity Trend Service, Inc. v. Commodity Futures Trading Commission, No. 97-C-2362, 1999 U.S. Dist. LEXIS 15877 (N.D. Ill. Sept. 28, 1999). The suit was brought by Commodity Trend Service Inc., now called CTS Financial Publishing Inc. CTS operates electronic publications about the securities and commodity futures markets, one of which is based on a computerized commodity futures trading system that CTS administers. The Court ruled, in effect, that the application of Section 4m(1) of the Commodity Exchange Act — a provision that effectively requires publishers dispensing “impersonal” futures market information to register with the CFTC — is an unconstitutional attempt to regulate speech in violation of the First Amendment to the U.S. Constitution. Specifically, the Court found that the section constitutes an “unconstitutional prior restraint as applied to providers of impersonal commodity trading advice.” For an article about the decision, see Futures Regulation – Commodity Trading Advisors: CFTC Registration Requirement on Publisher Regulates Speech, Violates First Amendment, 31(39) Sec. Reg. & Law Rep. (BNA) 1338 (Oct. 8, 1999). The decision follows a June 21, 1999 ruling by the Honorable Ricardo Urbina of the United States District Court for the District of Columbia holding that the CFTC’s effort to require the licensing of providers of information and opinions via Web sites, software, books and newsletters violates the First Amendment.

On October 5, a proposed amended complaint was filed in a defamation lawsuit brought in the United States District Court for the Southern District of New York by Sovereign Partners Limited Partnership, Dominion Capital Fund Ltd. and Stephen M. Hicks against Restaurant Teams International, Inc., ConSyGen, Inc., Stanley Swanson, Curtis Swanson and Thomas Dreaper. The suit alleged that the defendant companies made false and defamatory statements accusing plaintiffs of unlawful short selling “in a malicious effort to blame plaintiffs for the results of their own business and management failures.” As stated in a press release, “The [proposed] amended complaint . . . expands on plaintiffs’ original claims against Restaurant Teams, its officers Stanley and Curtis Swanson, ConSysGen, and its former CEO Thomas Dreaper. Since the original complaint was filed, plaintiffs discovered that Dreaper was responsible for Internet postings under the screen name “TradeIQ. Therefore, the amended complaint expressly seeks damages from Dreaper for those postings, as well as for his public statements as CEO of ConSyGen. The [proposed] amended complaint also adds charges against several new defendants, including: Restaurant Teams’ former financial advisor Harry N. McMillan; ConSysGen shareholder Mark Weiss; and two Internet users who have frequently posted messages [allegedly] defamatory of the plaintiffs and who, plaintiffs [allegedly] discovered, were provided with Restaurant Teams stock purportedly pursuant to its Employee Stock Option Plan.” See Business Wire – Company Press Release: Investors Amend Defamation Complaint Filed Against ConSyGen and Restaurants – Mark Weiss, Tom Dreaper, Harry McMillan, Lee Walsh and Other Internet Posters Named as Additional Parties in Amended Complaint, Bus. Wire, Oct. 5, 1999 (10:23 a.m. Eastern Time)

This article is meant to be a brief overview of design patent basics while informing the reader of the possibility for obtaining a design patent on computer icons. This is yet another tool for protecting your most important asset, your intellectual property. (Read more…)

On September 13, the 123rd Ohio General Assembly’s Substitute House Bill 6 took effect. It amends the Ohio General Corporation Law (Ohio Revised Code Chapter 1701) to authorize the use of electronic proxies for shareholder voting under Ohio corporate law.

This article is meant to be a brief overview of performing due diligence when dealing with venture capital, acquisitions, and mergers. This is an important tool for protecting your capital investment. (Read more…)

Copyright registration is the process of filing with the Library of Congress, Copyright Office, an application form. Registration is not necessary in order to have a copyright, however there are certain benefits of obtaining registration, discussed below. A copyright exists in an original work of authorship fixed in a tangible medium (Read more…)

Software patent filing and issuance is growing rapidly as intellectual property has widely become the core asset of many companies. Patenting software inventions has recently gained momentum as the intellectual property protection of choice. (Read more…)