🚀 go-pugleaf

Thanks to monumental bungling on the part of the US Department of Justice,
Attorney William Bode is almost assured, according to knowlegeable
observers of receiving between 20 and 30% of the 45 million plus dollars
collected by NSI at the behest of NSF for support of the Internet's
intellectual infrastructure.  This will be Bode's "fee" for engineering his
successful bid to overturn the 'legality" of the intellectual
infrastructure fund.  Judge Hogan yesterday, on the basis of limited
information presented to him by the US Department of Justice Attorney
assigned to defend the NSF, quite properly ruled that it was an illegal
tax.

THE ONLY PROBLEM IS that Judge Hogan ruled on the basis of *inadequate and
partial* information.  For example, not knowing anything of NSF Inspector
General's Linda Sundro's checkered history of running roughshod over NSF
policy making, the Judge cited her proposal for NSF to treat domain names
as a money making excise tax function for the federal treasury.  The record
before him listed the Sundro paper as part of NSF policy when, in fact, it
was rejected by NSF management almost exactly a year ago.  Hogan didn't
know that because the Justice Department Attorney representing NSF didn't
do her home work and didn't tell him that.

Indeed she made no adequate attempt to defend her client.  Did not do so in
January before the first ruling.  Nor did she do so at any later date, even
though her superiors had been fully warned in advance by numerous high
officials of Congress and Administration.  We have been writing about these
issues in great detail for over a year.  We have watched this develop in
great detail.  We know as few outsiders what happened and why.  We know
that NSF was not a renegade agency and that it had reason and documentable
support for what it did with the infrastructure fund.  We know that the US
Department of Justice attorney should have sat down with the NSF as her
client and that she should have worked with the people responsible to
understand what they had done and why.  We know that she did not do that.
What we do not know is **WHY.**  Was in just incompetence or inattention to
intervention by high officials OR was it intentional lack of support on
justices part?  This has been such an egregious failure with substantial
money and reputations of agencies at stake that it is hard to believe that
it was incompetence at both the representational level and at the
management level in the Office of the Attorney General.

When early in February the judge enjoined the spending of the funds, it was
a signal to folk around town that NSF had a problem.  The Chairs of the
relevant House and Senate Committees wrote Justice and said "do your
homework better this time."  Two individuals high in the executive branch
informed us that they were telling Justice that there was a problem in the
making because it had not given NSF adequate legal representation before
the court.  In other words that the court had only a fraction of the data
it needed in order to judge whether NSF had acted properly.  As the matter
moved closer to the March 17th court date, we were informed that the
promised help was not being delivered.  On March 11th we faxed Janet Reno a
complaint saying that we were aware of the problem.  That Justice was
wittingly allowing a situation to fester that was detrimental to the
Administration's Green Paper plans.  We warned that we would go public if
Justice continued to let support of NSF slide.

We know that Justice had every reason to have known that it was failing to
do its duty in representing NSF.  We know that having been informed by the
highest levels of the executive and legislative branches, it still took no
action to remedy its deficient representation of NSF.  We know that our own
threat on March 11th to expose its negligence after the fact had no effect.
We know that a major part of the responsible Federal agency handling of
Internet management has now been found by the courts to have been illegal.
Again what we do not know is why, when it had been forewarned that this
would happen, the US Department of Justice made no effort to forestall it.

Our article on this subject from the May 98 COOK Report follows.

US Department of Justice Fails NSF in Court

March 17 Hearing Overview & Survey of Some DNS Court Actions - Magaziner
Sells House: Pledges to Remain on Job

Recent developments in the Internet governance disputes have been legal.
They focus around the administration's inexplicable failure to get adequate
representation - despite many warnings - for the NSF in the lawsuit by
William Bode.  Those with the power (in theory at least) to get adequate
representation into the courtroom on March 17th failed.

All this went on while Ira Magaziner returned from a visit to Japan two
weeks ago, spent a long weekend on the job and left again for Europe last
week.  He will not return to the US until March 31.  Thus he will be out of
the country during the first week after the close of comments on the Green
Paper, when drafting of the final rule will begin in earnest.

In January Ira sold his Washington DC house.  Washingtonian Magazine
reported this in its February 98 issue on page 142.  This raises the
obvious question of how much longer he will be in DC heading the
Administration's Internet effort or as he likes to describe it:
'coordinating' the NTIA rule making process.' We asked him to comment on
the implications of this news.  His office called back with the response:
"Don't worry.  He will stay on the job."  That is good to hear.  The only
problem is that his statement does not specify how much longer he will stay
on the job.

Finally, given the legal bumbling by the DOJ in the Bode law suit, there is
the question of who in the administration is paying attention to unfolding
legal actions that, if they produced surprises, could derail Magaziner's
efforts.  Dan Steinberg, a Canadian attorney and policy consultant has
published a very interesting look at the implications of lawsuits by Bode,
PGP Media and a potential action by Karl Auerbach. We publish it, with some
comments of our own at the end of this article.

Will the Clinton
Administration Defend Those Who Carry out its Policy?

William Bode, in early February, won a preliminary injunction against
disbursement of any monies from the NSF created Intellectual Infrastructure
Fund.  He won it in no small part because the attorney sent to court on
NSF's behalf by DOJ was not versed in the appropriate law.

We pointed this out to some high administration officials who assured us
that they were letting the Department of Justice know that the Bode case
was one the government could ill afford to lose.  When queried, one
responded that he had been calling DOJ, and added in surprise: you mean to
say that they didn't pay any attention to our requests!?

When, as the March 17th date of the court hearing in the Bode suit drew
closer, and we realized that NSF was not getting the help that it
requested, we decided to try to apply some pressure directly to the DOJ and
sent the following letter published in the accompanying side bar.  In it we
suggested to Janet Reno that her department had failed to provide adequate
counsel to the NSF, had failed to provide additional promised help.   We
explained why we believed that DoJ had been derelict in its duty to the
NSF. We said that its dereliction was threatening the operational stability
of the network - should Bode win thanks to DoJ lack of support for NSF. We
pointed out that DOJ could show its intent to rectify the situation by
getting competent representation into the courtroom on March 17th.  We
concluded that, if it did not, we would go public with our fax and accuse
it of failing to act on behalf of the administration's Internet efforts
even after it had been forewarned.

It took seven phones calls before we got the phone and fax number of the
Executive Secretariat of the Attorney General.  They are (202) 514 4507 -
fax in office of Janet Reno's executive secretary and (202) 514 2171 -
phone for Reno's exec secretary. Another call provided confirmation that
the fax had been read and forwarded the justice [Case] Management Division
for action.

On the evening of March 17, after we had been briefed on what happened, we
sent out the following to a few private recipients: Discouraging news.
After my March 11 complaints I had word from two key administration
officials that the Department of Justice was being told to provide quality
legal support for NSF into Court today.  Such promises not withstanding,
the same DOJ attorney that originally was sent to defend NSF showed up once
again.  The attorney's defense was a disaster.  She had learned nothing
from the previous time.

Bode had his whole show prepared for sound bites rather than substance and
was a better lawyer than the woman who represented the NSF. But, he clearly
played to the press rather than the judge. Unfortunately, the NSF attorney
from DOJ had only one line, no show prepared and no sound bites. And, she
played to no one. It was embarrassing to see a lawyer so unfamiliar with
the relevant issues that she couldn't explain the intended purpose of
support awards; why the "Program Income" clause exists; what purpose it
serves, or the logic behind what was done. These concepts are an absolutely
necessary prerequisite to understanding what the NSF was doing with the
Infrastructure Fund. All she could say was that NSF was authorized by A110
to impose the fees but she couldn't provide or perhaps didn't understand
the rationale.

Bode was saying, "what NSF is doing is wrong" and she was saying "they
apparently have the authority to do it. Because she didn't understand the
whole thing herself she couldn't explain it. Basically, the government
presented no coherent explanation of it's actions and was unable to answer
concerns raised.

Of course the truth is that what NSF did was *NOT* wrong.  Unfortunately
the government's was not adequately refreshed on the relevant laws and
regulations.  When the judge, unsatisfied with Bode's explanation of the
intellectual infrastructure fund, asked the government's attorney to defend
NSF, she was basically unable to do so. The judge seemed uncomfortable with
the government being unable to articulate what NSF had done and why.  Then
still seeking a coherent sense of what had happened, the judge turned to
the NSI attorney who did give the logical explanation of NSF's authorities
and actions which should have come from the DOJ lawyer and did not.

Bode was given an opportunity to respond after NSI's presentation to the
judge. He (Bode) opted for bombast rather than substance: "most scandalous
contract in the history of the government" was a typical phrase.

The judge is taking the statements and submissions under advisement.  On
the basis of feedback so far, NSI's 70% is probably safe.  The 30% set
aside for the intellectual infrastructure fund, thanks to DoJ doing
essentially nothing, may be in danger.  [Editor: So much for the assessment
of those at the hearing.]

We had been told by those with the power (in theory at least) to get DoJ to
act that DoJ action WOULD be forthcoming.  It was not.  This tends to
undermine one's trust in those who are leading the show. No one who has
dealt with Ira Magaziner questions his sincerity or good intentions.  The
unanswered question is what indeed is his role?  Does he have the authority
to back his good intentions with results?  Or is he just out in front being
amiable and sincere while Kahin and Burr, unsupervised, impose their own
ideas on the Internet.

We hope this isn't true.  If it is, federal meddling in the Internet that
will create such a mess that it will be left to two clueless policy wonks,
Burr and Kahin to further. If this happens we may all safely guess that the
results will benefit the traditional telcos. Furthermore, a muddled
situation could turn out to be worth hundreds of billions of dollars to the
LECs and IXCs.  Why? Because it would permit them to use their lawyers and
cash to tie the Internet in knots staving off for many years the expansion
of the kind of Internet technology that will swallow incumbent IXCs and
incumbent LECS.

Editor's March 11 Fax to Janet Reno

The Honorable Janet Reno
Attorney General United States
United States Department of Justice
Washington, DC

Dear Attorney General Reno:

I am an independent journalist with a track record of nearly a year of
reporting, more closely than anyone else, on the matter of the intervention
of the United States Government in the Domain Name Service controversy in
general and in the governance of the Internet in particular. You may check
my credentials at <www.cookreport.com>. I am writing to you to point out
how dereliction of duty on the part of the Department of Justice is
threatening to undermine the work of Ira Magaziner and may result in a
legal outcome that gravely threatens the stability of the Internet.

I received a phone call this morning from William Bode, the attorney who
has brought suit against the National Science Foundation over the Internet
Intellectual Infrastructure Fund (IIIF).  He now has expanded his suit to
challenge the entirety of the five year cooperative agreement with NSI on
the part of the NSF.  The result is that, not only could the more than $50
million in IIIF money be held to have been illegally collected, but that
well over an additional $100 million in funds paid could also be put in
jeopardy.  Such action would produce extremely destabilizing consequences
for the Internet.

Some weeks ago the court enjoined the IIIF moneys from being spent on the
grounds that they amounted to an illegally levied tax.  On the basis of my
investigations I have concluded that the NSF's loss to Mr. Bode in that
instance was due to your Department's having provided to NSF counsel
without adequate knowledge of the NSF's contracting procedures and statutes
relevant to NSF's making of support awards which are somewhat different
from the processes and authorities used by other federal agencies in
awarding procurement contracts. Consequently because of inadequate
attention paid by your office, Mr. Bode has moved closer to being able to
collect a class action judgment that I am told will net him as much as 30%
of the proceeds.  Bode does not speak for me as a user of the Internet.
The six people on whose behalf he has filed are not people generally known
within the Internet community to have grievances with NSF.  In view of what
he stands to gain and the paltry sum that would be left to be refunded to
each of more than a million DNS registrants after expense of the refund
process is deducted, I question on whose behalf he is truly working.

But no matter what one thinks of Mr. Bode, what is even worse is that the
dereliction of duty on the Department of Justice continues.  I have it on
extremely good authority that Ira Magaziner's office has interceded with
people in your organization to obtain adequate representation on behalf of
NSF.  After Bode's call today I made inquiries on my own and have
ascertained that assistance promised has not been delivered and that non
legal personnel at NSF are being left essentially to prepare their own
defense!!  Further calls revealed that the entire personnel of the office
in your Department assigned to assist NSF are away "on retreat".  Moreover
there has been a pattern of non responsiveness from DoJ to NSF on this
matter for the past solid two weeks during which one deadline for filing
papers has already come and gone.  The second and final deadline is on
Thursday the 12.

In view of the fact that it is probably too late to get adequate assistance
to NSF by the Thursday filing deadline, it is especially critical to send
the highest ranking attorney possible to court on March 17th to show the
Judge that the United States government views this as a serious matter
after all.

I will be watching you and if you continue to be derelict in your duty to
provide appropriate defense to NSF, I will not hesitate to go public with
the text of this letter and with everything I know about this sorry affair.
If you let this slide again, the result could derail months of consensus
building effort on the part of Ira Magaziner.  I will inform my subscribers
and other press. I have already talked with Brock Meeks the Washington
correspondent for MS/NBC.  Brock tells me he will be in the courtroom on
March 17th.

Please do not let inaction on the part of US DOJ run the risk of resulting
in events that can greatly harm and destabilize the technology that is of
paramount importance to the President and Vice President.  For if Bode wins
his case I assure you that I will point out your role in such events.  You
have an opportunity to keep this situation from getting worse. Please make
use of it. Sincerely,  Gordon Cook

.
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