Techno file

Published on Sunday 22 June 2008 19:48

New charges for Nicholas A LEADING technology executive on trial in the US for his alleged role in the backdating of share options also stands accused of a string of drug and sex offences and of spiking colleagues and customers' drinks with ecstasy.

Henry T Nicholas III is the billionaire co-founder of Broadcom, the computer chip manufacturer which last year undertook the biggest ever earnings restatement because of stock option backdating, when it wrote down $2.2 billion of profits.

Last week a new set of claims made by the Department of Justice last October were unsealed in a California court. They allege that Nicholas took and supplied drugs, including ecstasy and cocaine.

He is said to have told one employee to pay a drug deliverer up to $10,000 in cash in the technology firm's lobby, and to have paid another ex-employee $1 million not to reveal details of his drug use.

The indictment also claims that Nicholas hired prostitutes for himself and customers of Broadcom and that he supplied the prostitutes with drugs.

In one claim made in the court papers Nicholas is said to have spiked executives' and customers' drinks with the drug ecstasy.

Forbes last year estimated Nicholas's wealth at $2.3 billion. He is accused of operating a ten-year stock option backdating fraud from 1995 to 2005.

AP v the internet

A MAJOR news agency has claimed that the use of any quotations from its stories online is copyright infringement and has demanded they be taken down in a case which could redraw the lines of acceptable blog behaviour.

The writer behind the blog told Out-law.com that if the AP agency continues its case it will be taking on the entire blogosphere. "Linking to news articles with short excerpts is common practice throughout the web, both on individual blogs and on social news sites," said Rogers Cadenhead, who is behind the Drudge Retort blog. "If AP intends to fight this one out, it'll be the case of AP v Everybody."

Even though a spokesman for AP told the New York Times that the news wire is re-thinking its position Cadenhead said that the notices have not yet been retracted. AP issued Drudge Retort with seven takedown notices under the US's Digital Millennium Copyright Act (DMCA), six about posted stories and one about a user's comment.

"I think using an excerpt of one to three sentences from a news article, when linking to that article, should be considered fair use," Cadenhead said.

Hacked off hacker

&#149 PENTAGON hacker Gary McKinnon has asked the House of Lords to halt his extradition to the US because American prosecutors abused the legal process by engaging in plea bargaining.

McKinnon's lawyer, David Pannick QC, told the Lords' hearing last week that prosecutors had said that he faced eight-to-ten years in jail if he contested the charges, but a sentence of only 37 to 46 months if he co-operated.

He also said that McKinnon was threatened with terrorism charges that carry potential 60-year jail terms.

Lawyers for the Home Office, arguing for extradition, said that no threats were issued by US authorities, and that the extradition should go ahead.

The Law Lords can block the extradition if they find that there has been an abuse of process. A ruling is not expected for a further three weeks. McKinnon hacked into computer networks belonging to US military headquarters, The Pentagon, Nasa and other government systems in 2001 and 2002.

Deal, or no deal?

&#149 GOOGLE and Yahoo! will face a competition probe over their proposed advertising deal. The inquiry will look at whether the deal gives the already-dominant Google too much market power.

At present, the deal only applies to the US and Canada and US authorities have said they will investigate it, but it is likely that European authorities would also examine the arrangement if it were extended to the EU.

The non-exclusive deal allows Google to place adverts next to Yahoo! search engine results for certain pre-chosen search terms.

Aware of the competition law sensitivities, the companies have left a window of three-and-a-half months for the US Department of Justice (DoJ) to investigate the deal for legal irregularities.

The US Senate has confirmed that its Antitrust Committee will investigate the deal, but the final word will rest with the DoJ, which will assess whether the move restricts competition too heavily in a market in which Google is already the strongest company.