Archive for February, 2016
February 23rd, 2016 at 2:37 pm
Pretrial Discovery Reform: An Undervalued Benefit of Patent Litigation Reform Legislation
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In the matter of much-needed patent litigation reform legislation before Congress, provisions targeting abuse of the pretrial discovery process constitute an underemphasized but critical component.

“Discovery,” for those who haven’t suffered the misfortune of practicing law or being sucked into litigation at some point in their lives, refers to the process by which litigating parties obtain relevant documents and information from opposing parties.  Typical methods of discovery include depositions (out-of-court testimony under oath), document requests, interrogatories and requests for admission (to obtain evidence and narrow the scope of questions to be litigated).

As anyone who has participated in the discovery process probably learned, it can become extremely burdensome in terms of time, money and logistical tedium.  Indeed, that’s why some parties abuse discovery in order to drive opposing parties toward settlement or withdrawal, even when those parties actually maintain the superior legal position.  Discovery abuse increases nuisance value and can be exploited as a tactic to harass and intimidate other parties.

Patent litigation is particularly subject to discovery abuse, because the issues litigated are typically complex, document-intensive and within the knowledge of enormous numbers of people.

For that reason, the discovery reform provisions of broader patent litigation reform are especially valuable.  The Innovation Act, which passed by a bipartisan 325 to 91 vote in the House of Representatives, moves toward a system in which discovery is limited to necessary information rather than endless fishing expeditions that lawyers exploit as a negotiating and intimidation tactic.

Importantly, however, the Innovation Act preserves important caveats to its reforms to preserve the interests of justice.  First, it explicitly allows that, “In special circumstances that would make denial of discovery a manifest injustice, the court may permit discovery, in addition to the discovery authorized under subsection (a), as necessary to prevent manifest injustice.”  Second, the Innovation Act allows that, “The parties may voluntarily consent to be excluded, in whole or in part, from the limitation of discovery provided under subsection (a) if at least one plaintiff and one defendant enter into a signed stipulation, to be filed with and signed by the court.”

Thus, the Innovation Act’s important discovery reform provisions can be superseded by court order or voluntary agreement of the parties.

Who could object to that common-sense reform?

Frivolous litigants and their attorneys, that’s who.  Reform of the pretrial discovery process would mean that such vexatious litigants would be less able to extract surrender or settlement from parties unwilling to subject themselves and their companies to the crushing burdens of discovery.  Any party acting in good faith, however, would obviously have nothing to fear.

February 22nd, 2016 at 3:59 pm
This Week’s “Your Turn” Radio Show Lineup
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Join CFIF Corporate Counsel and Senior Vice President Renee Giachino today from 4:00 p.m. CDT to 6:00 p.m. CDT (that’s 5:00 p.m. to 7:00 p.m. EDT) on Northwest Florida’s 1330 AM WEBY, as she hosts her radio show, “Your Turn: Meeting Nonsense with Commonsense.”  Today’s guest lineup includes:

4:00 CDT/5:00 pm EDT: Andrew M. Grossman, Partner at Baker Hostetler, Washington, DC office: President Obama’s Clean Power Plan;
4:15 CDT/5:15 pm EDT: Dean A. Reuter, Vice President & Director of Practice Groups at The Federalist Society: Vacancy on the Supreme Court and his latest book, “Liberty’s Nemesis: The Unchecked Expansion of the State”;
4:30 CDT/5:30 pm EDT: Gus Hurwitz, Visiting Fellow at the American Enterprise Institute: Apple Debate and Encryption;
5:00 CDT/6:00 pm EDT: Seth Cooper, Senior Fellow at The Free State Foundation: FCC and Proposed Tech Mandates; and
5:30 CDT/6:30 pm EDT: Tim Lee, CFIF’s Senior Vice President of Legal and Public Affairs: Hot Issues of the Week — Politics, Intellectual Property, and SCOTUS.

Listen live on the Internet here.  Call in to share your comments or ask questions of today’s guests at (850) 623-1330.
February 19th, 2016 at 12:06 pm
DISH Back on the Attack as it Continues to Lose Customers
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In recent weeks we’ve highlighted the unfortunate way in which Dish Network repeatedly resorts to crony capitalism to serve its own interest, and now we apparently have another manifestation.

You may have heard that a coalition called Stop Mega Cable, led by Dish Network, is leading a campaign to defeat the merger between Charter Communications and Time Warner Cable.  Today we received a clue about what’s behind the company’s opposition.

At the close of 2015, Dish reported a year-over-year decline of 81,000 customers, a poor showing made worse when one considers that the company augmented its numbers by including Sling TV customers.  Specifically, in the third quarter DISH announced it lost 23,000 customers, but the number was actually closer to 180,000 once Sling TV subscribers are excluded.

Clearly, DISH is losing its traditional TV customer base.  But instead of finding innovative ways to regain its standing, the company is speaking out against current and future competitors.  Dish is already losing tens of thousands of customers per month, and it would likely face even more challenges once New Charter enters the market.

Consequently, Stop Mega Cable works to limit consumer choice in order to benefit Dish. Any attempt to manipulate the industry should be met with skepticism, and the Charter/Time Warner Cable merger should be scrutinized on its own merits.

February 19th, 2016 at 10:42 am
Tweet Post: Fast Tool for Election Results and Commentary
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Reminder to CFIF Freedom Line blog readers:  When following debate performances, election results, or other breaking news stories of significant interest to conservatives and libertarians, our Tweet Post is a remarkable tool for real-time information, analysis and perspective.  Featuring a who’s who of commentary and news analysis, it is generally faster and more up-to-date than any other source.  Try it.  We guarantee you will like it.

To use, click here or on the homepage Tweet Post logo.  To learn more, click here.

February 18th, 2016 at 12:57 pm
Ramirez Cartoon: The Hypocrite In Chief
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Below is one of the latest cartoons from two-time Pulitzer Prize-winner Michael Ramirez.

View more of Michael Ramirez’s cartoons on CFIF’s website here.

February 16th, 2016 at 9:05 am
Hypocrite Chuck Schumer

Following the tragic news of Supreme Court Justice Antonin Scalia’s passing, Senate Majority Leader Mitch McConnell and other Republican lawmakers rightly have been arguing that Scalia’s replacement should be left to the next President.

Predictably, Senator Charles Schumer (D-NY), Harry Reid’s hand-picked replacement to become the Senate Democrat leader following Reid’s retirement in 2016, is crying foul.  On ABC’s “This Week,” Schumer bemoaned, “You know, the kind of obstructionism that Mitch McConnell’s talking about, he’s harkening back to his old days.”

But it was Schumer, back in July 2007, who argued in a speech to the American Constitution Society that, except for in extraordinary circumstances, the Senate should block any Supreme Court nominations made by President George W. Bush during his remaining time in office.  At the time, Schumer said:

We should reverse the presumption of confirmation. The Supreme Court is dangerously out of balance. We cannot afford to see Justice Stevens replaced by another Roberts, or Justice Ginsburg by another Alito.

Schumer went on to add:

We should not confirm any Bush nominee to the Supreme Court, except in extraordinary circumstances.

For the record, there were 18 months left in George W. Bush’s term when Schumer argued that the Senate block any additional nominees the President may have made to the Supreme Court.  The nation is now less than seven months away from electing Obama’s successor.

February 12th, 2016 at 8:31 am
The Controversy Surrounding HRC’s Speeches, Private Email Server and more
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In an interview with CFIF, Sarah Westwood, Watchdog Reporter for the Washington Examiner, discusses the controversy surrounding Hillary Clinton’s paid speeches to private groups, what is different about the use of personal e-mail accounts by former Secretaries of State Colin Powell and Condoleezza Rice as compared to Hillary Clinton, and the finger-pointing and mudslinging on the GOP side of the campaign trail.

Listen to the interview here.

February 10th, 2016 at 3:45 pm
The Super Bowl Ad You Didn’t See
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Below is one of the latest cartoons from two-time Pulitzer Prize-winner Michael Ramirez.

View more of Michael Ramirez’s cartoons on CFIF’s website here.

February 8th, 2016 at 2:53 pm
Puerto Rico: Lingering Questions for Banco Popular’s Richard Carrion
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Late last year, we posed several questions to Banco Popular President and CEO Richard Carrion, in conjunction with his appearance as a witness during a Congressional hearing on Puerto Rico’s public debt.

Our questions centered mainly upon his recent emergence as a staunch advocate of a unilateral restructuring of Puerto Rico’s debt, a bizarrely anti-lender stance for the head of the  Island’s largest bank.  Among our questions, we asked how Carrion’s bank had avoided the severe exposure to Puerto Rican debt experienced by the Island’s other lenders and citizens, and why Popular – a private sector leader by any definition – has been so reluctant to align with other private sector actors in negotiating a consensual debt solution between Puerto Rico and its lenders.

Needless to say, we found Carrion’s newfound fondness for complete restructuring puzzling.

A closer look at Popular’s financial disclosures, however, reveals the real reason the bank so proudly advocates in support of a super restructuring:  In 2014 and 2015, Popular shed massive amounts of government and public corporation debt that would be subject to a restructuring, enabling it to emerge as an ally for the Garcia Padilla Administration.

In December 2014, Popular was itself a large bondholder, with approximately $337 million of their $811 million (42%) exposure to Puerto Rican debt in public corporations PRASA and PREPA.  Its exposure to General Obligation debt was roughly $82 million, or 14% of its holdings.

Fast forward one year.  Banco has reduced its exposure to debt that would be subject to a restructuring drastically, now holding only $59 million of public corporation debt (10%) and $23 million (4%) of general obligation debt.  The remaining 86% of its exposure is to debt is in the form of loans to municipalities, which are not and never have been part of the restructuring discussion.  It has actually increased its exposure to this “safe” municipality debt by about $20 million over the same time span.

In other words, over the last year, Banco Popular has shed exposure to hundreds of millions in debt that would be subject to La Fortaleza’s scheme, while unsuspecting Puerto Ricans held various debts (PFCs, GOs, PREPA) and lost their hard-earned money.

Herein lies the twist:  Carrion’s timing was impeccable, but it also raises red flags.

In a recent news report, the Washington Free Beacon notes Carrion’s relationship with Antonio Garcia Padilla, the scandal-plagued brother of the governor who is the lone employee of a suspicious island-based non-profit.  That non-profit, of which Carrion is a board member, has received large contributions from Banco Popular and is housed in the bank’s San Juan headquarters.  Was Popular given advanced warning of this plan in exchange for that money?

As if that’s not already bad enough, there’s more.  Popular’s close relationship with the Garcia Padilla administration continues to pay dividends.  Banco stands to generate another $9 million in profit from the government’s recently proposed liquidation of Housing Finance Authority Assets, another windfall for what has already been a profitable financial crisis for the bank.

And what about the rest of the bondholders – those who will be wiped out by an unconstitutional restructuring, and don’t have the luxury of dumping their life savings in exchange for sweetheart deals from the Garcia Padilla administration?

If Popular truly seeks to restructure these debts for the good of Puerto Rico, will it support the same type of unilateral restructuring for other types of loans taken out by regular Puerto Ricans who are Popular customers?  Will Popular allow its own clients to restructure their mortgages and car loans and cease and desist from any and all foreclosure processes against these borrowers?

Call us skeptical.

February 8th, 2016 at 1:59 pm
This Week’s “Your Turn” Radio Lineup
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Join CFIF Corporate Counsel and Senior Vice President Renee Giachino today from 4:00 p.m. CST to 6:00 p.m. CST (that’s 5:00 p.m. to 7:00 p.m. EST) on Northwest Florida’s 1330 AM WEBY, as she hosts her radio show, “Your Turn: Meeting Nonsense with Commonsense.”  Today’s guest lineup includes:

4:00 CST/5:00 pm EST:  Ambassador Terry Miller, Director, Center for Data Analysis and The Center for Trade and Economics and Mark A. Kolokotrones Fellow in Economic Freedom at the Institute for Economic Freedom and Opportunity at The Heritage Foundation – 2016 Index of Economic Freedom;

4:30 CST/5:30 pm EST:  Bradley A. Smith, Chairman and Founder of the Center for Competitive Politics and Former Chairman of the Federal Election Commission – 40th Anniversary of Buckley v. Valeo;

5:00 CST/6:00 pm EST:  Sarah Westwood, Watchdog Reporter for the Washington Examiner – Recent Stories from the Campaign Trail; and

5:30 CST/6:30 pm EST:  Quin Hillyer, Contributing Editor of National Review, a Senior Editor for The American Spectator, and a nationally recognized political expert – New Hampshire Primary.

Listen live on the Internet here.   Call in to share your comments or ask questions of today’s guests at (850) 623-1330.

February 8th, 2016 at 12:37 pm
Dish Network Becoming a Crony Capitalist Serial Offender
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We’re not in the business of demonizing particular private enterprises.  But it is our mission to advance the principles of free markets.  And few things corrupt contemporary markets more than crony capitalism, the exploitation of government power for private purposes.  From eminent domain abuse to kneecapping competing businesses, individuals and groups who favor free markets shouldn’t remain silent when businesses engage in it.

And in the case of Dish Network, we seem to have a serial offender.

In recent weeks, we’ve rightfully criticized Dish’s shenanigans as it relates to the desperately-needed Federal Communications Commission (FCC) spectrum auction.

Unfortunately, that unseemly behavior extends to the realm of marketplace mergers between willing parties.  We believe that absent some demonstrable unfair harm or illegality, private businesses should be free to merge, split or otherwise transact as they see fit without governmental meddling.  Regulators and disagreeable parties should have to carry a burden of proof in establishing such illegality or unfair harm before telling mutually-bargaining parties what they and cannot do.

Dish Network, however, appears to believe that it should be free to engage in merger activity when it sees fit, but others should not enjoy the same freedom when that doesn’t serve Dish’s perceived interest.

Perhaps the most prominent immediate example is Dish’s opposition to the proposed merger between Time-Warner Cable and Charter Communications, where it has gone so far as to petition the FCC to block the agreement.  That maneuver parallels its previous opposition to the Time-Warner/Comcast merger, which CFIF supported in the face of needless federal meddling.  Dish also considered it appropriate to oppose the AT&T/DirecTV merger.

But note something peculiar.  Several years prior, Dish itself sought to merge with DirecTV.  Similarly, Dish sought to merge with T-Mobile back in 2015, and in 2013 it asked the FCC to refrain from interfering with the Sprint/Softbank Stake merger, because its own desire to acquire Clearwire depended upon that particular merger going forward.  And in 2011, Dish sought a $2 billion purchase of Hulu, despite maligning the same company less than one year earlier.

Again, we hold no particular animosity toward Dish as an entity, and no opinion regarding the quality of its service.  But we do have a problem with a company inserting itself into merger negotiations between third parties, characterizing mergers as harmful to the marketplace and imploring regulators to interfere with other parties’ private interactions, only to turn around and seek the very same types of mergers when it anticipates some individualized benefit.

That is the definition of crony capitalism, and it should be opposed by government officials and American citizens alike.

February 5th, 2016 at 9:39 am
Ramirez Cartoon: The Coin Toss
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Below is one of the latest cartoons from two-time Pulitzer Prize-winner Michael Ramirez.

View more of Michael Ramirez’s cartoons on CFIF’s website here.

February 5th, 2016 at 6:29 am
Millennials: Real Solutions for the Challenges They Face
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In an interview with CFIF, David Barnes, Policy Director of Generation Opportunity, discusses the challenges Millennials face, real solutions to be considered, and his recent TIME op-ed, “Obama’s Optimism Isn’t Shared by Millennials.”

Listen to the interview here.

February 2nd, 2016 at 3:10 pm
CFIF Scores Victory in Campaign Finance Case
On January 21, 2016, a three-judge panel on the U.S. Court of Appeals for the D.C. Circuit unanimously ruled in favor of the Center for Individual Freedom (“CFIF”) in Van Hollen v. FEC, a campaign finance case addressing free speech and compelled disclosure.

The decision marks the second time in the case that the Court of Appeals reversed a decision by District Court Judge Amy Berman Jackson, who twice struck down a Federal Election Commission (“FEC”) rule requiring non-profit organizations that spend more than $10,000 per year on electioneering communications to disclose only donors who give “for the purpose of furthering electioneering communications.”

Congressman Christopher Van Hollen (D-Maryland) brought suit against the FEC, hoping to force organizations engaged in electioneering communications to disclose all donors who contribute over a certain amount, regardless of whether they intended for their donations to fund such speech.

Anticipating that the FEC, due to its split membership, might not appeal any adverse decision at the district court level, CFIF intervened to protect free speech interests and to preserve a right to appeal.

The Court of Appeals’ decision, authored by Judge Janice Rogers Brown and joined by Judges David Sentelle and Raymond Randolph, reversed the district court and upheld the FEC rule as being consistent with the requirements of Chevron and the Administrative Procedure Act.  The court also acknowledged the burdens that compelled disclosure impose on free speech and association guaranteed by the First Amendment.

“By affixing a purpose requirement on BCRA’s disclosure provision, the FEC exercised its unique prerogative to safeguard the First Amendment when implementing its congressional directives,” wrote Judge Brown. “Its tailoring was an able attempt to balance the competing values that lie at the heart of campaign finance law.”

CFIF was represented in the case by Thomas W. Kirby, Jan Witold Baran, Caleb P. Burns and Samuel B. Gedge of Wiley Rein, LLP.

To read the full entire D.C. Circuit Court decision, click here (PDF).