D.C. Circuit Issues Landmark Decision Reviewing FCC’s 2015 TCPA Declaratory Ruling and Order, Sets Aside FCC’s Clarifications of an ATDS and Treatment of Reassigned Numbers

Today, the U.S. Court of Appeals for the D.C. Circuit issued its long-awaited decision reviewing the FCC’s 2015 TCPA Declaratory Ruling and Order.  In the case of ACA International v. FCC, Case No. 15-1211, the Court, in a 3-0 opinion authored by Judge Srinivasan, granted in part and denied in part the various petitions for review.  It set aside the FCC’s clarifications of an ATDS and its one-call safe harbor for reassigned numbers but upheld the FCC’s approach to revocation of consent. The case will now be remanded to the FCC, where the Commission will have an opportunity to reconsider the issues and address the court’s criticisms.

In prior briefing and during oral argument, Petitioners and Intervenors challenged the Order’s considerable expansion of the scope of the TCPA.  Petitioners and Intervenors focused on three main issues from the 2015 Declaratory Ruling and Order: (1) the expanded definition of what types of equipment serve as an autodialer, leading to liability under the TCPA for using such technology to place calls, (2) the called party/reassigned number provision, which mandates the imposition of strict liability for any call beyond the first call to a reassigned number, and (3) whether the FCC must give clearer guidance relating to how consumers can revoke consent to receive calls or text messages.

To read our full advisory, please click here. We are reviewing the decision in detail and will have a more comprehensive summary available soon.  In addition, Kelley Drye will be hosting a free webinar to discuss the implications of the decision and the future of TCPA reform efforts at the FCC and in Congress.  More details will follow in the next few days.

Ninth Circuit Selected to Hear Consolidated Net Neutrality Appeals

On March 8, 2018, the United States Judicial Panel on Multidistrict Litigation randomly selected the U.S. Court of Appeals for the Ninth Circuit to hear the petitions for review of the Federal Communications Commission’s (FCC’s) Restoring Internet Freedom Order. Under FCC rules, petitioners of FCC orders have ten days from the date of publication of the order to file an appeal and notify the FCC that they would like be considered for the judicial lottery drawing. In this case, petitions had been filed in the D.C. Circuit and the Ninth Circuit.

The decision is notable because the last three appeals of previous FCC net neutrality orders were heard in the D.C. Circuit. The last time the Ninth Circuit heard a challenge of FCC net neutrality rules was nearly 15 years ago, in Brand X Internet Services v. FCC, which led to the Supreme Court’s seminal opinion on the FCC’s classification of cable modem service in 2004, National Cable & Telecommunications Association v. Brand X Internet Services. The Brand X decision in turn ushered in a decade of deregulatory policy in the broadband ecosystem.

The Ninth Circuit’s most recent foray into broadband policy came last month when an en banc panel held that the “common carrier exemption” in Section 5 of the Federal Trade Commission (FTC) Act—which prohibits unfair and deceptive trade practices—was “activity-based” and therefore that the FTC could bring a suit against AT&T Mobility for alleged violations of Section 5 related to the company’s non-common-carrier broadband service. A previous panel had held that AT&T Mobility was entirely exempt from Section 5 based on its “status” as a common carrier, raising significant questions about the boundaries of FTC and FCC jurisdiction. The en banc decision brings the Ninth Circuit back into harmony with other circuits that have addressed the issue.

We’re monitoring the appeal and will continue to update this blog with developments.

Lucky Number 7? FCC Proposes Section 7 Rules to Fast-Track Review of New Technologies

On February 22, as part of its effort to accelerate the deployment of new and innovative technologies, the FCC adopted a Notice of Proposed Rulemaking (“NPRM”) to develop procedures for implementing section 7 of the Communications Act of 1934 (which was added by a 1983 amendment).  Section 7 states that the Commission “shall determine whether any new technology or service proposed in a petition or application is in the public interest within one year after such petition or application is filed.”  This proceeding presents a valuable opportunity for parties to potentially expedite FCC approval of their services, including petitions or applications that are already pending or are filed before the new rules are adopted. Continue Reading

Support for FTC Jurisdiction Over Broadband:  Ninth Circuit En Banc Rules  Common Carrier Exemption is “Activity,” and not “Status-based,” Reversing Earlier AT&T Victory

The Republican-led FCC’s effort to get out of the business of regulating broadband providers’ consumer practices took a step forward on Monday.  In an appeal that has been proceeding in parallel with the FCC’s “Restoring Internet Freedom” reclassification proceeding, the U.S. Court of Appeals for the Ninth Circuit issued an opinion giving the Federal Trade Commission (FTC) broad authority over practices not classified by the FCC as telecommunications services.  Specifically, the Ninth Circuit, sitting en banc, issued its long-awaited opinion in Federal Trade Commission v. AT&T Mobility, holding that the “common carrier exemption” in Section 5 of the FTC Act is “activity based,” exempting only common carrier activities of common carriers (i.e., the offering of telecommunications services), and not all activities of companies that provide common carrier services (i.e., rejecting a “status-based” exemption).  The case will now be remanded to the district court that originally heard the case.  Coupled with the FCC’s reclassification of Broadband Internet Access Services (BIAS) in the net neutrality/restoring internet freedom proceeding, the opinion repositions the FTC as top cop on the Open Internet and broadband privacy beats.

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FCC Sets Stage for $4.5 Billion Auction by Resolving Mobility Fund Phase II Challenges

The Federal Communications Commission (“FCC”) took a major step forward on closing the “digital divide” in mobile broadband at its February meeting by unanimously adopting an Order resolving the remaining challenges to the Mobility Fund Phase II (“MF-II”) auction.  The order eases the letter of credit requirements and clarifies the collocation obligations for funding recipients, but generally preserves the MF-II auction budget, disbursement, and performance rules announced last year.  After clearing away these challenges, the FCC will focus on identifying the areas eligible for funding and conducting the auction later this year.

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FCC Net Neutrality Repeal Published in Federal Register, Triggering Deadlines for Challengers

On Thursday, February 22, 2018, the Federal Communications Commission (FCC or Commission) published the Restoring Internet Freedom Order (the Order) in the Federal Register.

As we previously discussed, the Order effectively reverses the Commission’s 2015 Open Internet Order, reclassifying broadband Internet access service as a lightly regulated Title I “information service” and eliminating the 2015 Order’s open Internet rules (while retaining a modified version of the transparency requirement).

The Order will not go into effect until after the Office of Management and Budget completes its Paperwork Reduction Act review, which could take several months. However, last Thursday’s publication is significant because it triggers deadlines for challenges to the Order, both in the courts and in Congress.

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Updated 499-A Form and Instructions Signal Start of 2018 USF Season

Last week, the FCC released its form and instructions for the 2018 499-A, due April 1st. The 499-A form is filed by almost all intrastate, interstate and international providers of telecommunications in the U.S. and reports historic annual revenue. Notably, the FCC’s Wireline Competition Bureau did not solicit comments on the form and instructions this year, but that may be due to the lack of substantive changes from the 2017 versions.  In previous years, and most recently in 2015, the Bureau sought comment on proposed revisions to the 499-A documents.

Filers, please remember to review your records carefully before filing.  Now is the time to make sure that reseller certifications are in order and to update traffic studies and jurisdictional estimates.  The form should also be reviewed against the prior year’s form for consistency.  Significant changes, such as large increases or decreases in revenue, on a particular line or the absence of revenue reporting on a line where revenue was reported the prior year, are red flags that almost always generate additional USAC scrutiny.

Finally, remember that downward revisions to the 2017 Form must be filed by March 31st.

To learn more about the form, audits and investigations and developments affecting the USF, register for our 9th Annual webinar.

USF Update: Where Are We Now?

In 2017, the Government Accountability Office (GAO) released a report focusing on the Lifeline program. Tucked away in that report was a significant discussion of Universal Service Fund (USF) contributor audits that has received little attention. In a recent episode of Kelley Drye’s Full Spectrum podcast, Partner Steve Augustino and Special Counsel Denise Smith discussed four trends in USF contributor audits that they expect to result from the GAO report.

Kelley Drye’s Communications group continues to monitor this and other USF issues. Join us on March 8th for our 9th Annual USF Update webinar as the group discusses audits, enforcement actions and more.

Beyond the Latest Frontier: Licensed, Unlicensed, and Experimental Operations above 95 GHz

Fulfilling a promise made by Chairman Pai in the fall that the Federal Communications Commission would give a close look to opening up licensed operations in the bands above 95 GHz, the FCC announced tentatively on February 1 that it will consider commencing a rulemaking to do just that at its next Open Meeting on February 22.  The Commission released a draft Notice of Proposed Rulemaking (“Draft NPRM”) with the announcement that details how the Commission may go about fostering investment and innovation in the 95-275 GHz range and beyond.  If approved, the so-called Spectrum Horizons NPRM would seek comment on potential rules for fixed point-to-point use of tens of gigahertz of new spectrum, more than 15.2 gigahertz of unlicensed spectrum, and more flexible experimental licenses in the 95-3000 GHz range. Continue Reading

Ready, Set, Bid: FCC Announces July Start Date for Auction to Provide Support for Voice and Fixed Broadband in Unserved High-Cost Areas

At the January Open Meeting, the Federal Communications Commission (“FCC”) adopted a Public Notice (“PN”) that sets July 24, 2018 as the start of the Connect America Fund Phase II auction (“Phase II Auction”) in which service providers can compete for up to $1.98 billion annually in financial support over 10 years.  This will be the first time a reverse, multi-round auction is used to provide support for high-cost rural areas. The FCC also adopted an Order on Reconsideration (“Recon Order”) that resolves outstanding reconsideration petitions related to the Phase II Auction.

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