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Legal news from Wednesday, August 4, 2010 |
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Intel settles anticompetitive conduct suit with FTC
Daniel Richey on August 4, 2010 3:43 PM ET

[JURIST] The Federal Trade Commission (FTC) [official website] settled [press release; decision, PDF] its lawsuit [case materials] against Intel [corporate website] on Wednesday, with the industry-leading microchip maker agreeing to a set of conditions designed to facilitate fairer competition from competitors such as Advanced Micro Devices (AMD) and Nvidia [corporate websites]. The FTC originally filed suit alleging violations of Section 5 of the Federal Trade Commission Act [text, PDF], which punishes a broad scope of anticompetitive actions. Intel was accused [complaint] of engaging in a number of anticompetitive practices, including employing retalitory measures against hardware partners who purchased properties from competing chip makers and using its large market presence to perpetuate a monopoly over the central processing unit (CPU) market for its x86 CPU platform. FTC chairman Joe Leibowitz praised the settlement as producing a swifter and farther-reaching effect on the consumer chip market than seeing the case through litigation likely would have:By accepting this settlement, we open the door to competition today and address Intel's anticompetitive conduct in a way that may not have been available in a final judgment years from now. Everyone, including Intel, gets a greater degree of certainty about the rules of the road going forward, which allows all the companies in this dynamic industry to move ahead and build better, more innovative products.
The terms of the agreement encompass Intel's activities in the CPU, graphics processor (GPU) and proprietary chipset markets. In addition to constraining Intel from using its market stature to coerce its partners' other business deals, the agreement also forces the company to restructure its intellectual property agreements with several hardware manufacturers to allow them to move more freely in the market, and to disclose to programmers that its developer-issued CPU programming software may not permit them to utilize performance-enhancing features of competitors' CPUs. Intel senior vice president and general counsel Doug Melamed emphasized that the company has admitted no wrongdoing [press release] in the settlement and said it allows Intel to "put an end to the expense and distraction of the FTC litigation."
The government originally filed suit [JURIST report] against Intel in December 2009. The settlement follows a similar suit [JURIST report] filed in November 2009 by the New York Attorney General [official website], alleging that the microprocessor manufacturer engaged in illegal conduct to further its dominance in the marketplace. Attorney General Andrew Cuomo claims that many of the company's agreements were deliberately aimed at disadvantaging AMD, Intel's primary competitor in the CPU market. Also in November of last year, Intel agreed to settle [JURIST report] all of its outstanding legal issues with AMD with a $1.25 billion payout.


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Canada court orders release of Khadr brother
Dwyer Arce on August 4, 2010 1:29 PM ET

[JURIST] The Ontario Superior Court of Justice [official website] on Wednesday ordered the release of Abdullah Khadr, the brother of Guantanamo Bay [JURIST news archive] detainee Omar Khadr [DOD materials; JURIST news archive] after staying a US extradition request. Abdullah Khadr has been detained by Canadian authorities since December 2005 on a US arrest warrant for terrorism issued by the US Attorney's Office for the District of Massachusetts [official website]. He was captured by Pakistani forces the year prior at the request of the US government which suspected him of securing weapons for al Qaeda [GlobalSecurity backgrounder]. Justice Christopher Speyer called the decision one of last resort [The Star report] which was necessary due to the illegal nature of Abdullah Khadr's detention. Abdullah Khadr's lawyers had argued that the evidence that US and Canadian authorities were relying on consisted only of coerced statements that were made under duress after torture. While acknowledging that extradition requests from the US were rarely denied [CBC report], Speyer emphasized the exceptional nature of this case and the unreliability of the evidence against
Abdullah Khadr. He was released following the decision. The Canadian government has 30 days to appeal, but has not announced whether it will do so.
In 2006, the Ontario court held that the US could seek extradition against Abdullah Khadr. The previous month, the US government formally requested his extradition [JURIST report] from Canada. He was indicted in 2006 [JURIST report] by a US federal grand jury on four counts connected to his alleged procurement of destructive devices to be used against US forces in Afghanistan in 2003 and faces a possible life sentence and a USD $1,000,000 fine. Former US Attorney Michael Sullivan said he plans to pursue the extradition "aggressively." Abdullah Khadr admitted to attending an al Qaeda training camp at age 13, but denies the allegations of membership in the group or of supplying weapons to it. Another of Abdullah Khadr's brothers, Abdul Rahman Khadr, was released from Guantanamo in 2003.


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Senate hears final statements on Kagan confirmation
Daniel Richey on August 4, 2010 10:10 AM ET

[JURIST] The US Senate [official website] on Tuesday heard final statements [transcript] on the confirmation of US Supreme Court [official website] nominee Elena Kagan [official profile; JURIST news archive]. Most Senate Republicans oppose her confirmation, but have chosen not to pursue a filibuster [Washington Post report] given statements from five Republicans confirming that they will vote for Kagan's confirmation. Senator Jeff Sessions (R-AL), the ranking Republican on the Senate Judiciary Committee [official websites], questioned Kagan's "discipline" [video] and called her an "activist, liberal, progressive, politically-minded judge who will not be happy to simply decide cases, but will seek to advance her causes." Senator Lindsey Graham (R-SC) [official website] explained his decision to support Kagan [video], arguing that the Advise and Consent Clause of the US Constitution [text] is not meant to subject nominees to the discretion of the Congress, but only to check against the appointment of judges who are grossly lacking in character or qualifications or who were inappropriately nominated:We're trying to make sure the President, he or she, picks a good, qualified judge, not some unfit character, not some person ... who would be a lousy judge. Now, when I apply that standard to Elena Kagan, I cannot find anything about her that makes her an unfit character to me. Quite frankly, from what I know about her from listening to her for a couple of days and having people tell me about her, is I think she's a very fine person, with stellar character. Senator Ben Nelson (D-NE) [official website] is the only Democratic member of the Senate expected to vote against Kagan. The final vote on her nomination is expected Thursday.
The Senate Judiciary Committee approved Kagan's nomination [JURIST report] last month with a largely party-line 13-6 vote [video]. Earlier that month, the committee delayed its vote [JURIST report] at Sessions's request. In asking for the delay, Sessions cited concerns over Kagan's positions [video] on legislation during the her time working in the Clinton administration and called her answers to questions during the hearing "less than candid." Kagan's confirmation hearing concluded in June [JURIST report]. During the hearings, Kagan addressed the effect of political bias on the court and stresed the importance of not bringing politics to the bench. Kagan's confirmation hearings began [JURIST report] with Democratic and Republican senators offering contrasting interpretations of Kagan's judicial philosophy and lack of experience on the bench. President Barack Obama nominated Kagan [JURIST report] in May to replace former justice John Paul Stevens, who announced his retirement [JURIST report] in April. Kagan became the first woman confirmed as Solicitor General [JURIST report] in 2009.


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Khadr lawyer petitions Supreme Court to stay proceedings
Dwyer Arce on August 4, 2010 10:05 AM ET

[JURIST] A US military lawyer for Canadian Guantanamo Bay [JURIST news archive] detainee Omar Khadr [DOD materials; JURIST news archive] filed an emergency petition [text, PDF] with the Supreme Court [official website] on Monday, seeking to stay proceedings in Khadr's military commission. The petition asks the court to issue a writ of mandamus [Cornell LII backgrounder] to the US Court of Appeals for the District of Columbia Circuit [official website], ordering it to rule on a similar petition filed in that court in April. In the alternative, it argued that the Supreme Court itself should rule on the stay due to the short amount of time before the start of the trial. The petition, filed along with a request for expedited consideration, argues that the military commission system set up by the Military Commissions Act of 2009 [texts, PDF] is unconstitutional because in enacting it, Congress exceeded the authority given to it by the Define and Punish Clause of the US Constitution [text]. The petition explained:Petitioner's arguments ... are likely to succeed, will have an enormous impact on the constitutional viability of the military commissions system as a whole, and have never been addressed by this Court before. [T]he Define and Punish Clause is the enumerated power authorizing Congress to enact law-of-war military commissions to try "Offenses against the Law of Nations," ... impos[ing] limits on the scope and nature of the jurisdiction of military commissions so enacted[.] ... [T]he Military Commissions Act of 2009 exceeds those limits, based on the historical background of the adoption of the Define and Punish Clause, the consistent jurisdictional practices of American military commissions since before the Revolutionary War, and this Court's precedents on military commissions' jurisdiction and status as creatures of the law of war. [B]ecause Congress was without authority ... to enact the military commission ... Petitioner has the right not to be put on trial before it. The petition further argues that the court must issue a stay and consider the constitutional question, otherwise Khadr will be subjected to an unconstitutional trial, inflicting "significant harm."
Last month, the US District Court for the District of Columbia [official website] allowed Khadr to amend [JURIST report] his 2004 habeas corpus petition, but refused to lift the stay on the petition pending the conclusion of his military commission. Khadr's lawyer announced that week that he will vigorously defend Khadr at his trial scheduled to begin August 10 [JURIST reports]. Khadr fired his US civilian lawyers in July and requested that his US military lawyer be fired as well. Judge Patrick Parrish denied Khadr's request and ordered US Army Lt-Col. Jon Jackson to remain Khadr's lawyer and provide him with a defense at trial. Also in July, Khadr rejected a plea deal [JURIST report] offered by the US government, which would have resulted in a five-year prison sentence. Khadr is facing murder and terrorism charges [JURIST report] for allegedly throwing a grenade that killed one US soldier and injuring another. If he is found guilty, he could face a life sentence. Khadr's defense lawyers have repeatedly sought his repatriation [JURIST report] to Canada on the basis that the Canadian government's refusal to request repatriation from the US violates the Canadian Charter of Rights and Freedoms [text].


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Missouri voters pass law seeking to bar health care mandate
Dwyer Arce on August 4, 2010 8:44 AM ET

[JURIST] Missouri voters on Tuesday approved Proposition C [text], which seeks to make the individual mandate provision of the recent health care reform law [HR 3590 materials; JURIST news archive] unenforceable in the state. The law, which was passed with 71.1 percent in favor [results], stated that "[n]o law or rule shall compel, directly or indirectly, any person, employer, or health care provider to participate in any health care system." The law was sent to voters by the Missouri General Assembly [official website] after significant opposition from the Democratic caucus. The initiative was placed on the ballot after replacing a proposed state constitutional amendment that would have been voted on in Novermber. While the Supremacy Clause [Cornell LII backgrounder] of the US Constitution [text] makes state law subordinate to federal law, the measure is seen as a way to either color enforcement of the reform law [Kansas City Star report] in the state or to provide the foundation for a court challenge. Proposition C also included a provision allowing insurance companies to liquidate more easily and goes into effect immediately. Similar laws have been passed by the legislatures of Arizona, Georgia, Idaho, Louisiana and Virginia [JURIST report]. Oklahoma, Arizona and Florida will have similar initiatives on their ballots [JURIST report] during the November midterm elections.
A judge for the US District Court for the Eastern District of Virginia [official website] on Monday denied a motion to dismiss a lawsuit [JURIST report] brought by the state of Virginia challenging the constitutionality of the individual mandate provision of the health care law. The Virginia Health Care Freedom Act was the first of its kind passed by any state, and says that no individual shall be held liable if they refuse to sign up for health care. The court found that Virginia had standing to bring the case because the federal health care law directly contradicts the state law, which the state has an interest in defending. The court also found that the question of whether Congress had exceeded its authority under the Commerce Clause [Cornell LII backgrounder] and the Tax Clause was one that "raise[d] a host of complex constitutional issues." In May, the National Federation of Independent Businesses (NFIB) [association website], a small business lobby group, joined 20 states in a lawsuit [JURIST report] challenging the health care reform law in the US District Court for the Northern District of Florida [official website].


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Federal judge approves $600 million Countrywide class action settlement
Andrea Bottorff on August 4, 2010 7:29 AM ET

[JURIST] US District Court for the Central District of California [official website] judge Mariana Pfaelzer on Monday gave preliminary approval to a settlement in which Countrywide Financial Corporation [NYT backgrounder] agreed to pay $600 million to settle several class action lawsuits brought by former stockholders accusing the company of securities fraud. The settlement is the largest such agreement resulting from the financial crisis [JURIST news archive] and was announced in quarterly report [text, PDF] sent from Bank of America [corporate website], which acquired Countrywide in 2008, to the US Securities and Exchange Commission (SEC) (official website). The plaintiffs in the lawsuit had claimed that Countryside's directors and officers failed to provide effective oversight of the company's origination, lending, and underwriting practices, which caused the company's stock to plummet. Countrywide denied that it committed any crimes against investors and former CEO Angelo Mozilo [TIME profile], former president David Sambol and former CFO Eric Sieracki were not obligated to contribute to the settlement despite being named in the lawsuit.
Last month, Countrywide reached a $108 million settlement agreement [JURIST report] with the Federal Trade Commission (FTC) [official website] to resolve charges that it collected excessive fees from homeowners facing foreclosure. The agreement allows the FTC to create a fund to provide refunds to borrowers affected by the company's improper fees. Also last month, the SEC charged [JURIST report] former Countrywide officials with securities fraud arising from misleading investors. The complaint alleged that the officials knew the company was issuing risky loans and that defaults and delinquencies would rise as a result. Since the financial crisis, Countrywide has also settled lawsuits with the SEC and several state attorneys general [JURIST reports].


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