Federal Communication Commission Should Encourage Innovation and Private Investment in Rural America

Last week, Congress held a hearing to evaluate proposals and recent actions of the Federal Communications Commission (FCC) and determine how the agency can better serve the public. Both Republican and Democratic members asked all five FCC commissioners questions regarding their work over the past year on a range of issues that impact consumers, from spectrum to broadband deployment. One particular issue that surfaced repeatedly during the hearing was how the FCC can improve its efforts to expand these essential services and resources to rural areas.

Millions of Americans living in rural areas and communities still lack high-speed broadband. Access to higher quality, faster Internet enhances people’s lives by providing more opportunities in education, healthcare, and professional development. It brings communities together and levels the playing field between rural areas, smaller towns and larger urban centers. But more must be done, and the National Grange is a strong advocate for Federal policies that help deliver the online opportunities that those rural areas deserve.

The FCC should learn from successful actions of the past and exercise regulatory caution moving forward. Over twenty years ago, the government embraced a light-touch regulatory approach that enabled the Internet to flourish into the essential modern technology and engine of economic growth and opportunity that it continues to be today. Now the FCC wants to impose outdated regulations onto broadband networks. This approach will inhibit the capital investment necessary for deploying broadband to underserved areas and rural communities that need access to broadband the most.

Consumers in rural America are better served by policies that encourage innovation and private investment so that the marketplace and competitors can provide a variety of choices and innovate, build, and expand to meet consumer demand. It is the sustained investment in expanding broadband networks that enables companies to deliver economic opportunities to rural communities and ensure no one is left behind.

The Grange wants to work cooperatively with government and other stakeholders to ensure regulations have purpose and achieve the goal of meeting the needs of consumers, businesses, and entrepreneurs in rural areas. A heavier regulatory hand that saddles the Internet with regulation of the old Bell system threatens to undermine the very innovation and investment that produces benefits. A light-touch policy is a smart approach to getting all of America – particularly rural communities – connected once and for all.

Federal Appeals Court Makes Disappointing Decision on Patents

On August 13 – the U.S. Court of Appeals for the Federal Circuit denied a petition for rehearing en banc in the Apple-Samsung patent dispute. The National Grange has closely followed this lawsuit for its impact on Grange members’ access to advanced telecommunications technologies. Last month we filed an Amicus brief urging the court to reconsider the $399 million penalty imposed for alleged design patent infringement covering basic shapes.

The Court’s decision yesterday is a blow to industries and consumers. The decision itself was no more than a paragraph and ignores several industry briefs that were filed in response to the hearing en banc, including one from the Grange. As the law currently stands, a design patent infringement can result in the infringing entity being liable for the total profits earned on the product in which the design is incorporated regardless of the importance of the patented design. This is a far cry from reasonable royalty damages used for utility patents, meaning that an infringer is liable only for damages correlating with the patent(s)’ contribution to the overall product.

As we explained in our blog, the current interpretation of design patent law (Section 289 of the U.S. patent code) opens the door for businesses and individuals to seek outsized settlements for design patents, further incentivizing trolling and patent assertion. The federal court has had several opportunities to update its interpretation of Section 289, but now it’s possible the issue could go before the Supreme Court. Without clarification, design patents could become the new target for trolls and ultimately impact consumers, particularly those in rural areas where access and price for technology is critical.

Spectrum Need

Ed+Luttrell_PROFILEThe United States is experiencing a “Mobile Revolution”. Experts predict that by 2020 the number of connected devices will reach 50 billion.

The “Mobile Revolution” is changing how Americans communicate and manage nearly every aspect of daily life. These advancements have made life easier, more enjoyable, and more productive for the millions who have embraced these innovative technologies. Among those who are embracing and relying on wireless broadband services at an increasingly rapid pace – although often over looked – are farmers, ranchers, and others who make up our rural communities.

Mobile broadband connectivity has become an increasingly important part of life for rural America. Many farmers rely heavily on applications to provide critical weather and crop information while access to high speed wireless services and products allow rural Americans to have greater access to telemedicine, educational opportunities, and provide vital connections to public safety.

Congress is currently considering legislation to reallocate spectrum from the federal government for commercial use by mobile broadband providers. In fact, on July 19 the Senate Committee on Commerce, Science, and Transportation held a hearing titled “Wireless Broadband and the Future of Spectrum Policy” .

Hearings such as this are important stepping-stones for ensuring future mobile broadband connectivity and creating solid public policy that allows all Americans to take full advantage of mobile technologies now and in the future. With the emerging Internet of Things (IoT) and the majority of consumers opting for the latest smartphones, tablets, or other connected devices – mobile broadband providers are facing a swiftly approaching spectrum shortage.

This is cause for concern for all Americans but particularly for our rural communities. Spectrum is critical to expanding high-speed mobile broadband and the demand for spectrum has never been higher. It’s estimated that wireless Internet traffic in North America is expected to grow more than 41-fold from 2011 to 2016, which is why it’s so critical for Congress to infuse more spectrum into the commercial market.

We are facing this shortage because the federal government is sitting on an overwhelming majority of spectrum. However, clearing and deploying new spectrum takes years, so in order to ensure a steady stream of spectrum to meet consumer demand, we have to begin now.

Repurposing spectrum held by the federal government for commercial use will generate significant economic activity. The Federal Communications Commission recently concluded a spectrum auction, which raised a groundbreaking $45 billion, money that’s used to reduce our growing national deficit.

The National Grange believes high-speed mobile broadband will dramatically improve life in rural America. It will create opportunities for young Americans to pursue their interests in rural America, while remaining connected with the entire globe. It will aid our older citizens to remain healthier and independent in their golden years. We must pursue all available options to provide the same high-speed wireless access seen in suburban communities to rural America.

Now is the time for congress to pass legislation that creates a long-term and predictable future for releasing valuable spectrum in order to meet the growing consumer demand for wireless technology.

Washington’s Overlooked Barrier to Internet Access

A growing consensus is emerging in Washington about the necessity of reliable access to the Internet and online resources. Last week, in front of a packed auditorium in the capital of the Choctaw Nation, President Obama unveiled the ConnectHome initiative, which aims to provide high-speed internet to some 200,000 rural and low-income families. The month prior, Congressional leaders introduced the Digital Learning Equity Act, seeking to rollout greater out-of-school Internet access for students through Department of Education grants.

As the Internet has fast become the bedrock of commerce and communication, such efforts are critical to ensure a level playing field for businesses and communities, especially those in the rural pockets of the country.

Congress has been spinning its wheels trying to address utility patent trolls, yet they’re ignoring the looming threat of design patent trolls that have seen a catalyst from recent court decisions. Specifically, recent interpretations of Section 289 of the U.S. patent code have opened the door for businesses and individuals to seek outsized settlements for design infringements, which could further incentivize patent trolling and predatory patent litigation.

In May of this year, without any analysis of the importance of the patented designs, the Federal court ruled that an entity that infringes on a patented design could be held liable for all the profits earned from the product in which the design is incorporated. This can lead to the absurd scenario in which an unwitting infringer could be forced to pay their full profits several times over if they intrude on more than one protected design. Given that many products, especially high-tech devices incorporate numerous patented components, the outcome is untenable.

Consider, for example, a situation in which the manufacturer of a tractor might be forced to pay all his or her profits from the equipment because it infringed on a patent covering the design of the fender. The manufacturer might then be required to pay the same amount to a second patent holder with the rights to the wheel design. It quickly becomes a race of who can bleed them dry first.

This multiple damage scenario is particularly likely to occur when a single product contains different patented features held by several owners. It’s not difficult to see how soon the tractor manufacturer has little incentive to produce the equipment at all.

The potential infringement claims don’t stop at the manufacturer. It can trickle down to the store selling the tractor as well as tractor owners – who frankly aren’t purchasing tractors based on fender or wheel design, yet could be paying large sums for operating the infringing machinery. This domino effect is thanks to the “make available for sale” provision in Section 289, which shares blame with those selling an allegedly infringing a product. Under this interpretation, if a farm operator purchased equipment or tools that have infringing design patents on them online from a company like eBay or Amazon, does this then make eBay or Amazon liable for “exposing the sale” of products that infringe on design patents, even if for a minor feature? If this is the case, this will have a chilling effect on these necessary business models that provide rural customers access to a wide range of products difficult to obtain locally.

The dilemma is particularly troublesome for technology providers, and thereby for the individuals who rely on the devices they create to access the Internet. A recent Pew Research study found one in five American adults rely on their smartphone as their primary, and often only, access to the internet. In rural parts of the country still lacking adequate broadband infrastructure, it’s not uncommon that a smartphone serve as their sole connection to the Internet. Barriers that hamper development of new devices obstruct their access to online resources.

Because smartphones and other modern appliances utilize many patented technologies – the iPhone, for example, hundreds of patented elements – developers face the risk of paying out their full profit for intruding only a few discrete features, as was a court’s decision in a recent case between Apple and Samsung. With such sizable consequences, companies may well forego developing new technologies for fear it will end up costing them.

Simply put, infringement penalties should fit the scope of the infringement. One wouldn’t expect the tractor manufacturer to give up all his or her profits because of a bumper design. That shouldn’t be the case in the U.S. technology markets either.

As early as late nineteenth-century, the National Grange has advocated the risks in design patent law. In 1879, our organization cautioned about emergence of “patent sharks,” some of earliest predatory patent abusers, which patented designs on crowbars, hoes and other tools and then demanded to be paid by others in the agricultural industry. In the Apple-Samsung case [CLICK HERE TO VIEW BRIEF], the National Grange filed an Amicus brief urging the court to reconsider the outsized $399 million penalty imposed because the ruling’s implications for modern day tools – tools that are helping to close the digital divide.

In response to the courts’ failure to curb patent litigation abuse, for the past year, Congress has been debating various patent reforms. In the case of design patents, it looks like the court has again failed to interpret the law reasonably and indeed laid the groundwork for additional frivolous litigation. While we filed a brief calling on the Court to revisit this issue, if Court denies a rehearing or fails to set a reasonable standard for the award of total profits, Congress should turn some attention to the issue of design patents and provide much-needed guidance to the courts.

Medicare Part D Rebates

The National  Grange has joined a large number of patient health and elderly care organizations on a letter to the U.S Congress opposing proposals to weaken programs for seniors and persons with disabilities.  One of these proposals would mandate rebates on Medicare’s Part D drug program.  But these are not rebates to patients as one might assume.  This money would be treated as a tax paid by drug manufacturers direct to the Federal Government with no resulting new drug development or lower patient prescription costs.  Click here to read Medicare Part D letter to Congress

Postal Service Cuts Causes Rural Concerns

Despite three cautionary reports by the Postal Regulatory Commission, The Postal Service’s Office of Inspector General, and an internal management report, the U.S. Postal Service has moved ahead to reduce its service standards for First-Class Mail.  These new policies will create a two-tier network with service to rural areas and small towns downgraded much more than large urban areas.  Several state and local Granges are objecting to the Postmaster General with copies to their Senators and Representatives.  Click here to read Op-Ed by Commissioner Ruth Y. Goldway

USDA Extends Application Deadline for Dairy Margin Protection Program to Dec. 19

Dairy producers urged to act now to protect their businesses against unpredictable market swings, take advantage of increased protections offered in first year of program

WASHINGTON, Dec. 4, 2014 – U.S. Department of Agriculture Secretary Tom Vilsack today announced that the application deadline for the dairy Margin Protection Program (MPP) will be extended until Dec. 19, 2014.  The program, established by the 2014 Farm Bill, protects participating dairy producers when the margin – the difference between the price of milk and feed costs – falls below levels of protection selected by the applicant.

“The 2014 Farm Bill created these safety net programs to provide safeguards against the uncertainty of weather and markets, but this safety net is not automatic. Producers must visit their local Farm Service Agency office to enroll before December 19,” said Vilsack. “Despite the best forecasts, weather and markets can change, so a modest investment today can protect against unexpected losses tomorrow.”

“For just $100, a farmer can cover 90 percent of production at $4 margin swings, and with affordable incremental premiums, dairy farmers can cover up to $8 margin swings,” said Vilsack. “Those who apply this year will receive a slight increase in production protection that will not be available in the future. Farmers who do not sign up for the Margin Protection Program for 2015 will forfeit the 1 percent base production increase. For a 400 cow operation, this would equate to an additional 80,000 pounds of milk that are eligible for coverage. It’s a small step to take to ensure your business is covered.”

Vilsack encourages producers to use the online Web resource at www.fsa.usda.gov/mpptool to calculate the best levels of coverage for their dairy operation. They can type in specific operation data and explore price projections and market scenarios to determine what level of coverage is best for them. They can also compare the data to see how the program would have helped in previous years, such as 2008, when margins dropped from $8 to $3 in just three months. The online resource is on a secure website that can be accessed from computers, mobile phones or tablets, 24 hours a day, seven days a week.

Farmers also have a chance to share comments and help shape the Margin Protection Program for the future. Last month, the U.S. Department of Agriculture (USDA) announced the extension of the opportunity for public comments on both the Margin Protection Program and the Dairy Product Donation Program until Dec. 15, 2014. Comments can be submitted to USDA via the regulations.gov website at http://go.usa.gov/GJSA or send them by mail to: Danielle Cooke, Special Programs Manager, Price Support Division, FSA, USDA, STOP 0512, 1400 Independence Ave. SW, Washington, D.C., 20250-0512.

Today’s announcement was made possible through the 2014 Farm Bill, which builds on historic economic gains in rural America over the past five years, while achieving meaningful reform and billions of dollars in savings for the taxpayer. Since enactment, USDA has made significant progress to implement each provision of this critical legislation, including providing disaster relief to farmers and ranchers; strengthening risk management tools; expanding access to rural credit; funding critical research; establishing innovative public-private conservation partnerships; developing new markets for rural-made products; and investing in infrastructure, housing and community facilities to help improve quality of life in rural America. For more information, visit www.usda.gov/farmbill.

To learn more about the Margin Protection Program for dairy, contact your local USDA Farm Service Agency county office at offices.usda.gov or visit us on the Web at www.fsa.usda.gov.

Federal Appeals Court Scheduled to Make Important Ruling

Today is a big day in the intellectual property arena, and it’s not just scholars and technology aficionados who are taking notice. The United States Court of Appeals for the Federal Circuit is set to hear appeals and objections in the Apple vs. Samsung proceedings (14-1335, Apple Inc. v. Samsung Electronics Co., Ltd.), a critical case in the development of design patent reform. The National Grange is paying close attention to this case, being heard directly across Lafeyette Park from the National Grange Building in Washington DC, for its impact on Grange members access to advanced telecommunications technologies.

This case is not just a showdown between two corporate smartphone giants, who are primarily concerned with a jury’s award of close to $399 million dollars to Apple as damages for design patent infringement. It is of distinct interest to the National Grange and all of our members living in tribal, rural and remote communities across the country. We are deeply concerned that damages awards of this scope for this type of infringement will have ramifications far outside of the courtroom, including on rural communities that may suffer reduced internet access as a result. Smartphone technologies are essential to rural Americans in distinct ways. Wired broadband access is not as common in rural communities, and those who live in these areas frequently rely on their smartphones’ wireless capabilities (so called “mobile hotspots”) for the ability to access the internet.

Design patent damages can currently be measured based on 100 percent of the infringer’s profit. Given that a design patent is only a small piece of a larger product, this measure of potential damages is not warranted. The national Grange is pleased that our Amicus brief for the Apple v. Samsung case was referenced at the Design Law 2014 conference in November (downloadable here, slide 39). We hope the Appeals court agrees that the design patent infringement standards are unfair to tribal, rural and remote communities and need remedying.

Agriculture, Interior Departments partner on water quality

ALTON, Ill., Oct. 21, 2014 – The United States Department of Agriculture (USDA) and the U.S. Department of the Interior (DOI) announced a new partnership agreement today that will provide a clearer picture of the benefits of farmers’ conservation practices on the quality of our Nation’s water.

Working together, USDA’s NRCS and DOI’s USGS will quantify the benefits of voluntary agricultural practices at a watershed scale. This information will strengthen the effectiveness of state and federal nutrient reduction strategies while protecting the privacy of individual farmers. The agreement was announced at the Mississippi River Gulf of Mexico Watershed Nutrient Task Force Meeting.

“On a voluntary basis, the agricultural community has put extensive effort into the management of nutrients and reducing runoff into waterways. This collaboration will help evaluate the impact of farmers’ conservation efforts on improving water quality,” said Ann Mills, USDA’s deputy under secretary for Natural Resources and Environment.

Mills said when hundreds of farms take action in one watershed, it can make a difference-it can help prevent an algal bloom downstream or lessen the need for water treatment plants to treat for nitrates.

Read the full story here.

New Whole-Farm Revenue Protection Insurance Premium Subsidy Established

2014 Farm Bill Required Policy Offers Diversified Farms More Affordable Protection

WASHINGTON, Oct. 3, 2014 — The U.S. Department of Agriculture’s (USDA) Risk Management Agency (RMA) today announced that a premium subsidy has been established to offer more affordable protection to eligible diversified farm operations, as part of the new Whole-Farm Revenue Protection insurance policy.

Whole-Farm Revenue Protection, required by the 2014 Farm Bill, will be offered through the RMA managed federal crop insurance program. The new policy will offer fruit and vegetable growers and producers with diversified farms selling commodities to wholesale markets, local and regional markets, farm identity preserved markets, or direct markets, more flexible, affordable risk management coverage options.

“Crop insurance options continue to adapt to meet the farm safety net needs of today’s farmers,” said RMA Administrator Brandon Willis. “Whole-Farm Revenue Protection insurance will expand options for specialty crop, organic and diversified crop producers, allowing them to insure all the crops at once instead of one commodity at a time. That gives them the option of promoting crop diversity and helps support the production of a wider variety of healthy foods.”

Read the full story here.