Clips July 29, 2003

[Lillie Coney <lillie.coney@xxxxxxx>]

Clips July 29, 2003

ARTICLES

University must show backups in MP3 case
Pentagon Prepares a Futures Market on Terror Attacks
Bar raised for accounting software
Judge sets rules for e-mail retrieval 
BuyMusic's downloads strike a sour note 

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Australian IT
University must show backups in MP3 case
Simon Hayes
JULY 29, 2003  
 
THE Federal Court has allowed music industry piracy investigators access to 100 backup tapes from the University of Sydney's computer network to search for evidence of piracy.

The backup tapes had been overwritten in the normal course of business, counsel for the universities told the court. 
In a hearing this afternoon on an ongoing matter between music labels Sony, Universal and EMI and the Universities of Sydney, Melbourne and Tasmania, the court accepted the labels' arguments that they be allowed access to the tapes to see if they still contained useful information. 

Wrangling between the two sides on whether a computer forensics expert employed by the music companies could have access to the tapes has been going on since last week, just before the expert commenced his search. 

Justice Tamberlin issued orders on July 18 allowing the labels, under strict conditions, to search for evidence of alleged music piracy on the networks of the University of Sydney, the University of Melbourne and the University of Tasmania. 

Counsel for the University of Sydney had argued the data sought on the backup tapes was overwritten on a regular basis, and thus was not covered by the orders. 

But Justice Tamberlin allowed access to the tapes, accepting the labels' argument that they be allowed access to see if some useful information may still exist despite the overwriting. 

The universities are expected to present 100 backup tapes for searching. 
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Associated Press
Agencies Prepare Kits to Fight ID Theft 
Mon Jul 28, 4:51 PM ET
By JEANNINE AVERSA, Associated Press Writer 

WASHINGTON - Stolen credit card and Social Security (news - web sites) numbers. Check fraud. Drained bank accounts. Ruined credit. Nightmares for victims, identity crimes also can be vexing to local police departments trying to unravel the crimes. 


To help local police officers better understand and investigate these crimes, an electronic package is being mailed out Tuesday to more than 40,000 police departments and other law enforcement authorities, the Secret Service (news - web sites) said Monday. 


"If you're a victim of identity crime, you're not going to call a Secret Service agent; you're going to call your local police department," said Richard Starmann, one of the Secret Service's main point people on the project. 


"What we were finding ... was that some of them knew what to do. Some had a lot of experience working this type of crime. But the great majority of them didn't really have the experience they needed to work this type of crime," Starmann said. 


The materials include a 10-minute video that can be shown to officers during roll call meetings, which often take place before daily shifts begin. In the video, law enforcers share their experiences in combating identity crimes and what works for them. 


An electronic guide provides officers with more than 40 investigative resources that officers can use in their investigations as well as a variety of information to help victims. 


For instance, included in the electronic guide are materials from the Federal Trade Commission that advise victims to contact: 


_Credit bureaus and request that a "fraud alert" be placed in their files. 


_Creditors to see if any accounts have been used or fraudulently opened. 


_Their local police departments to file a crime report. 


For local police officers, there's a wide range of materials, including questions to ask and things to look for when conducting identity crime investigations; the best way to seize electronic evidence; and advice on how to detect bogus credit cards and passports. 


Starmann said identity thieves have various reasons to engage in these types of crimes. Among them are personal gain, to buy goods and services; financial gain, to bankroll other criminal activities, such as drugs and weapons trafficking or terrorism; and help in moving anonymously through society for any number of reasons. 


Roughly 10 months in the making, the electronic materials package is a project of the Secret Service, the Federal Trade Commission, the U.S. Postal Inspection Service and the International Association of Chiefs of Police. 


Timothy Caddigan, the Secret Service's special agent in charge of the criminal investigative division, said the electronic materials cost $250,000 to produce and distribute. The project was paid for with money forfeited in criminal cases involving the Treasury Department (news - web sites), he said. 


Complaints about identity theft were at the head of the government's list of consumer frauds in 2002 for a third consecutive year. Experts blame easily available technology. 
___ 

Secret Service: http://www.ustreas.gov/usss/ 
FTC: http://www.ftc.gov/ 
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New York Times
July 29, 2003
Pentagon Prepares a Futures Market on Terror Attacks
By CARL HULSE

WASHINGTON, July 28  The Pentagon office that proposed spying electronically on Americans to monitor potential terrorists has a new experiment. It is an online futures trading market, disclosed today by critics, in which anonymous speculators would bet on forecasting terrorist attacks, assassinations and coups.

Traders bullish on a biological attack on Israel or bearish on the chances of a North Korean missile strike would have the opportunity to bet on the likelihood of such events on a new Internet site established by the Defense Advanced Research Projects Agency. 

The Pentagon called its latest idea a new way of predicting events and part of its search for the "broadest possible set of new ways to prevent terrorist attacks." Two Democratic senators who reported the plan called it morally repugnant and grotesque. The senators said the program fell under the control of Adm. John M. Poindexter, President Ronald Reagan's national security adviser.

One of the two senators, Byron L. Dorgan of North Dakota, said the idea seemed so preposterous that he had trouble persuading people it was not a hoax. "Can you imagine," Mr. Dorgan asked, "if another country set up a betting parlor so that people could go in  and is sponsored by the government itself  people could go in and bet on the assassination of an American political figure?" 

After Mr. Dorgan and his fellow critic, Ron Wyden of Oregon, spoke out, the Pentagon sought to play down the importance of a program for which the Bush administration has sought $8 million through 2005. The White House also altered the Web site so that the potential events to be considered by the market that were visible earlier in the day at www.policyanalysismarket.org could no longer be seen.

But by that time, Republican officials in the Senate were privately shaking their heads over the planned trading. One top aide said he hoped that the Pentagon had a good explanation for it.

The Pentagon, in defending the program, said such futures trading had proven effective in predicting other events like oil prices, elections and movie ticket sales.

"Research indicates that markets are extremely efficient, effective and timely aggregators of dispersed and even hidden information," the Defense Department said in a statement. "Futures markets have proven themselves to be good at predicting such things as elections results; they are often better than expert opinions."

According to descriptions given to Congress, available at the Web site and provided by the two senators, traders who register would deposit money into an account similar to a stock account and win or lose money based on predicting events.

"For instance," Mr. Wyden said, "you may think early on that Prime Minister X is going to be assassinated. So you buy the futures contracts for 5 cents each. As more people begin to think the person's going to be assassinated, the cost of the contract could go up, to 50 cents.

"The payoff if he's assassinated is $1 per future. So if it comes to pass, and those who bought at 5 cents make 95 cents. Those who bought at 50 cents make 50 cents."

The senators also suggested that terrorists could participate because the traders' identities will be unknown.

"This appears to encourage terrorists to participate, either to profit from their terrorist activities or to bet against them in order to mislead U.S. intelligence authorities," they said in a letter to Admiral Poindexter, the director of the Terrorism Information Awareness Office, which the opponents said had developed the idea. 

The initiative, called the Policy Analysis Market, is to begin registering up to 1,000 traders on Friday. It is the latest problem for the advanced projects agency, or Darpa, a Pentagon unit that has run into controversy for the Terrorism Information Office. Admiral Poindexter once described a sweeping electronic surveillance plan as a way of forestalling terrorism by tapping into computer databases to collect medical, travel, credit and financial records. 

Worried about the reach of the program, Congress this year prohibited what was called the Total Information Awareness program from being used against Americans. Its name was changed to the Terrorism Information Awareness program.

This month, the Senate agreed to block all spending on the program. The House did not. Mr. Wyden said he hoped that the new disclosure about the trading program would be the death blow for Admiral Poindexter's plan.

The Pentagon did not provide details of the program like how much money participants would have to deposit in accounts. Trading is to begin on Oct. 1, with the number of participants initially limited to 1,000 and possibly expanding to 10,000 by Jan. 1.

"Involvement in this group prediction process should prove engaging and may prove profitable," the Web site said.

The overview of the plan said the market would focus on the economic, civil and military futures of Egypt, Jordan, Iran, Iraq, Israel, Saudi Arabia, Syria and Turkey and the consequences of United States involvement with those nations. The creators of the market envision other trappings of existing markets like derivatives.

In a statement, Darpa said the trading idea was "currently a small research program that faces a number of major technical challenges and uncertainties."

"Chief among these," the agency said, "are: Can the market survive and will people continue to participate when U.S. authorities use it to prevent terrorist attacks? Can futures markets be manipulated by adversaries?"

Mr. Dorgan and Mr. Wyden called for an immediate end to the project and said they would use its existence to justify cutting off financial support for the overall effort. In the letter to Admiral Poindexter, they called the initiative a "wasteful and absurd" use of tax dollars.

"The American people want the federal government to use its resources enhancing our security, not gambling on it," the letter said.
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Associated Press
Skyrocketing method patents stifling innovation, say critics
BOSTON (AP)  In the early 1990s, Tim O'Reilly's company had a new and potentially lucrative idea: Use advertising revenue to run a Web portal. Essentially, O'Reilly claims, Global Network Navigator invented the Internet banner ad.
According to a landmark court decision handed down five years ago this month, O'Reilly may have been able to patent the idea as a "business method"  a move that could have changed the course of Internet history.

But even if he could have, O'Reilly says he wouldn't have.

"If I had been able to put a patent on that and collect from everybody else who did it, that would have held back the industry tremendously," said O'Reilly, who after the sale of GNN to America Online now heads O'Reilly Associates, a tech publishing company. He is a critic of broad patent protections.

That's one view of patents. The other is held by the likes of Jay Walker.

Like O'Reilly, Walker is an e-commerce pioneer  he founded Priceline.com  and considers himself a champion of innovation.

But Walker's company, Walker Digital LLC of Stamford, Conn., has made a business of patenting just about any business method it can. He owns more than 200, including ones on online dating and running slot machines.

Walker applauds O'Reilly's selflessness, but disputes the logic. Patent rights don't slow technological innovation, he says; they spur it.

"If you want to give your house to the city for a public park, great," he said. "On the other hand, we shouldn't deny people the right to have houses."

Experts say the 1998 "State Street vs. Signature Financial" decision from the U.S. Court of Appeals for the Federal Circuit was an acknowledgment that intellectual property was as much about ideas as about things. The U.S. Patent Office had been granting business method patents for years and the court simply signaled its approval.

But the decision inspired thousands to file patents on things like new kinds of credit card offers and methods for teaching a golf swing.

In 1997, the year before the ruling, the Patent Office received 927 applications under its main classification for business methods. In 2001, that number rose to 8,700, falling to 5,000 last year as many small companies went out of business.

"In the dot-com era, the first thing they did was go get a patent, because that's what the investors were looking for," said Tom Turano, an attorney at Testa, Hurwitz & Thibeault, a Boston firm with a large technology practice.

It wasn't just startups. Entire industries, like financial services and insurance, which had never considered their ideas patentable, began hiring lawyers to protect intellectual property.

Even with the economy slow, patents remain a kind of secondary currency. Yahoo's chief executive, Terry Semel, said this month that Overture's 60-plus patents were a chief reason behind his decision to acquire the pay-for-placement search engine company for $1.6 billion.

Patents are designed to encourage innovation by guaranteeing inventors some reward  generally exclusive rights for 20 years. The idea must be considered useful, new and "non-obvious."

In computers, the definition of "obvious" is blurry. Programs are instructions telling a computer to do something. The "something" may sound obvious, but the instructions may not be.

That fuzziness has sparked concerns that too many "obvious" ideas are getting patented.

Among the criticized:

"One-click" shopping. Between 1999 and 2001, Amazon.com and Barnesandnoble.com battled in court over whether Barnesandnoble.com's "Express Lane" feature infringed on Amazon's patent for letting customers complete their orders with one click. The parties settled, but not before Barnesandnoble.com shut down the feature for two Christmas seasons. 
Online auctions. In May, a jury ruled that one of eBay's Internet-based auction systems violated a patent filed by a Virginia attorney. It ordered the company to pay him $35 million. EBay is asking that the verdict be overturned. 
Online DVD rentals. Last month, Netflix won a patent for the technology that allows customers to set up a rental list of movies they want mailed to them. The news sent Netflix's stock soaring; investors bet it would help the company muscle out rivals Wal-Mart and Blockbuster. 
To Walker, patent protections spur innovation by requiring the inventor to tell the world how an idea works, instead of locking it away as a trade secret.

Walker also notes that every new wave of technology has brought cries it should be kept "above" the patent system. A previous generation worried electricity would fall in the hands of a few monopolies; instead, Walker said, patent protection attracted investment and inspired a wave of marvelously creative uses.

But O'Reilly says the computer revolution really is different.

"The Internet was very much a culture of leapfrog, not king of the hill," he said. "There was this sort of orgy of copying, which I think led to some pretty substantial innovation. As we see more patents, I see the innovation slowing down."

Programmers, he said, waste time finding different ways to solve problems somebody else already figured out.

"I regret every patent I ever filed," said Doug Cutting, a programmer who helped file patents for former employers Apple and Xerox but says he won't file any more because he wants to be able to reuse his own code.

Too many small companies are spending their money on patent lawyers, not research, says O'Reilly. And Walker, he says, isn't helping.

"I think he's abusing the system," O'Reilly said. "At the end of the day, when you look at his company, his R&D department consists of lawyers."

Walker denies that, saying his company spends millions on research and hardly anything on lawyers. His goal is to license technology, not fight over it in court.

O'Reilly says that's still a problem.

"It's not innovation. It's a business model of ripping off the patent system," he said. "Maybe he should patent that!"
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Federal Computer Week
Bar raised for accounting software
BY Matthew French 
July 28, 2003

Changes to a program for better federal financial management could make it harder to sell administrative software to the government.

The Joint Financial Management Improvement Program  an undertaking of four federal departments  is adding more criteria that sellers of accounting programs and other financial software must meet to qualify to sell to agencies. 

"It answers the question, 'Does the software meet the core requirements we specify?' " said Stephen Balsam, a senior associate for the program. "After the last round of testing, we studied the process and came to the conclusion that we could test more thoroughly."

Government agencies must purchase software from a certified vendor if the application is being used to satisfy one of the financial management program's core requirements. If an agency has a requirement that is not in the core criteria, it can buy software from any company it chooses. 

More criteria are being added as agencies contact program officials, Balsam said. Currently, qualified software must meet 1,500 benchmarks across several areas. So far, three companies  SAP AG, American Management Systems Inc. and Digital Systems Group Inc.  meet them. 

Oracle Corp., PeopleSoft Inc. and Savantage Solutions Inc. are testing or are scheduled to test the products by the end of September.

Certification expires after three years to ensure that software keeps up with agencies' needs. "The fact that vendors have to take and pass these tests means they're getting educated," said Jeffrey Hoge, director of the Accounting Systems Division of the Treasury Department's Financial Management Service. 

The program is a cooperative venture of Treasury, OMB, the General Accounting Office and the Office of Personnel Management.
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Government Computer News
07/28/03
Judge orders Interior to shut off Internet connections 
By Wilson P. Dizard III 

Judge Royce C. Lamberth of the U.S. District Court for the District of Columbia late this afternoon issued a preliminary injunction requiring the Interior Department to disconnect its IT systems from the Internet, with some exceptions. 

The preliminary injunction followed a hearing this morning in which the plaintiffs in the Cobell v. Norton litigation, who represent American Indian trust beneficiaries, sought the injunction. The goal of the injunction is to protect American Indian trust accounts from intrusion via the Internet. 

Lamberth wrote in today?s order that Interior will not have to disconnect any system ?essential for protection against fires or other threats to life or property.? He required the department to identify and certify such systems within 10 days and provide specific justifications for keeping them online. 

The order to remove Interior systems from the Internet was the second the judge handed down in two years. He issued a similar order on Dec. 5, 2001, to address similar security concerns with the trust accounts. 

The judge also exempted systems that do not provide access to American Indian trust data or are secure from unauthorized entry. Lamberth allowed the department 15 days to certify that the systems are secure or do not provide access to the trust data. 

Lamberth ordered Interior to provide a plan within 30 days of how the court could approve reconnections of individual systems to the Internet, and determine whether reconnected systems should stay connected. 

The reconnection plan must provide a method for the court to determine that the reconnected systems are secure, according to the preliminary injunction. 

Lamberth ruled that the court itself would decide whether reconnected systems should stay connected to the Internet. In doing so, he eliminated the role of special master Alan Balaran, a court official who has been overseeing the reconnection and security testing of Interior?s systems since December 2001, when Lamberth first ordered Interior to disconnect the systems to protect trust data. Balaran?s role was established in a Dec. 17, 2001, consent order that Lamberth suspended in today?s preliminary injunction. 

Interior spokesman Dan Dubray said 20 percent of the department?s systems were already disconnected from the Internet due to previous court orders. He said he could not comment on the preliminary injunction because he had not seen it.
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CNET News.com
Judge sets rules for e-mail retrieval 
By Lisa M. Bowman 
Staff Writer, CNET News.com
July 28, 2003, 4:19 PM PT


A federal judge has ordered financial firm UBS to pay most of the cost of restoring lost e-mail in a gender discrimination suit against it, but she did shift some of the burden to the plaintiff. 
In a decision with wide-ranging ramifications for any company that keeps electronic records, U.S. District Judge Shira Scheindlin outlined and applied a set of legal principles that judges and parties in a lawsuit must consider when deciding who should pay for electronic evidence retrieval. These include whether the information sought is relevant to the case and whether the costs of retrieving the documents would be too costly.

Based on those principles, she determined that UBS must pay 75 percent of the estimated costs of restoring the documents from backup tapes. She also ruled that UBS must pay the entire cost of "producing" them, which includes costs such as hiring a lawyer to review the restored documents for privileged information before releasing them. That brings the UBS share of the costs to about $232,000.


Laura Zubulake, a former UBS equities trader who is suing the company for gender discrimination, must pay 25 percent of the estimated cost of restoring the data from backup tapes, or about $41,488, according to court documents. Zubulake is seeking e-mails she said would prove that UBS employees failed to promote her and then terminated her because she's a woman. 

Traditionally, the party that turns over the papers in a case pays the full cost of doing so, unless some other arrangement is made. However, the issue of electronic documents is complicated because, unlike paper records, they can be retrieved once deleted. Such recovery is often quite costly. 

"We are pleased that the judge has shifted a portion of the cost of restoration of the e-mails to the plaintiff," UBS spokesman Paul Marrone said. 

The judge said she decided that Zubulake must pay 25 percent of the restoration costs based on several factors, including her salary, which had been $650,000 a year before her termination, and the possibility of a multimillion-dollar payout from the case. 

"A share that is too costly may chill the rights of litigants to pursue meritorious claims," Scheindlin wrote in her decision. "However, because the success of this search is somewhat speculative, any cost that fairly can be assigned to Zubulake is appropriate and ensures that UBS' expenses will not be unduly burdensome." 

Although the dispute involves a fairly common claim of gender discrimination, legal experts said the decision is significant, because it helps to establish parameters for turning over electronic evidence--an issue that's becoming increasingly common, as more companies keep electronic records, and as e-mail becomes a more sought-after form of evidence. 

Jonathan M. Redgrave, a lawyer for Jones Day who is an expert in electronic discovery but is not involved in the case, called the decision a "must read" for in-house counsel at businesses of all types. 

"This obviously has large implications for a spectrum of cases out there," said Redgrave. "Practically all cases today involve some form of electronic documents." 

Redgrave said facts in other cases might result in a different split of the costs, but he said the principles used by the judge will likely be cited in many other cases. 


He said companies should examine the decision and study their document management and archival policies to make sure that they are up to date, in order to save on any future litigation costs.
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USA Today
BuyMusic's downloads strike a sour note 
By Jefferson Graham USA TODAY
July 28, 2003

Last week Buy.com tried to take a bite out of Apple's successful iTunes Music Store by rolling out a low-priced song-download service said to be simple and reliable.
But in an example of the technological trickiness involved in offering users the freedom they desire while giving music labels the protections they demand, early customers have found they can't transfer the tunes they buy on BuyMusic.com to digital portables. 

The Mac-only iTunes has won raves for ease of use, both in burning CDs and transferring songs to Apple's iPod players. But BuyMusic's tracks have started out as unplayable, even on portables lent to the press in a promotional blitz. 

"We're working on this," says Buy.com's Scott Blum, who says the company will have the glitch fixed today and that customers who have bought tracks will receive an e-mail offering free re-downloads. 

The problem: Unlike MP3 music tracks plucked from the Net from pirate sites such as Kazaa, music on BuyMusic is encoded in Microsoft's Windows Media Audio format. The "digital rights management" coding limits what can be done with the files. The files will be recoded to allow for transfers, Blum says. 

It's an early embarrassment for BuyMusic, which rushed to be first to offer song sales without subscription fees to users of Windows PCs. The Net retailer made a splash with a 160-foot-high Times Square billboard featuring a near-naked Tommy Lee. It sells MP3 players by Creative Labs and others.

"It's unfortunate they had this glitch," says Creative's Craig McHugh, adding that many customers have been calling seeking help. "We've been really excited about BuyMusic and its potential."

BuyMusic.com's tech support staff was of little help when contacted Thursday. An e-mail response read: "We are unable to provide technical assistance after you have downloaded the music ... to your primary computer. In addition, we are unable to credit you back for failed or damaged copies once you have successfully downloaded the music."

Apple has sold 6.5 million songs since April; BuyMusic won't release figures, but "it's not millions," Blum says.
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