Selected portions of the BloostonLaw Telecom Update, and/or the BloostonLaw Private Users Update — newsletters from the Law Offices of Blooston, Mordkofsky, Dickens, Duffy & Prendergast, LLP are reproduced in this section with the firm's permission.
| BloostonLaw Telecom Update || Vol. 17, No. 14 || April 9, 2014 |
Form 481 Filing Deadline on the Horizon: July 1, 2014
The FCC's Form 481 is due on July 1, 2014, and must not only be filed with USAC, but also with the FCC and the relevant state commission and tribal authority, as appropriate. Last year, filers were required to seek confidential treatment separately with the FCC and the relevant state commission and tribal authority if confidential treatment was desired. Because this entails manual filing, it can be cumbersome.
BloostonLaw is available to assist filers in all aspects of Form 481 filing procedures, including requesting confidential treatment.
Representatives Introduce Resolution on Rural Call Completion
On April 2, 2014, Congressman Bob Latta (R-OH) and Congressman Peter Welch (D-VT), Co-Chairmen of the Rural Telecommunications Working Group, introduced a bipartisan resolution that outlines steps the Federal Communications Commission (FCC) can take to improve telephone service in rural areas.
Specifically, House Resolution 536 resolves that it is the sense of the House of Representatives that:
- all providers must appropriately complete calls to all areas of the United States regardless of the technology used by the providers;
- no entity may unreasonably discriminate against telephone users in rural areas of the United States; and
- the Federal Communications Commission should—
- aggressively pursue entities whose violations of the rules of the Federal Communications Commission contribute to a lack of quality telecommunications services in rural areas of the United States, and impose swift and meaningful enforcement actions to discourage—
- practices leading to telephone calls not being completed in rural areas of the United States; and
- unreasonable discrimination against telephone users in rural areas of the United States; and
- move forward with clear, comprehensive, and enforceable actions in order to establish a robust and definitive solution to discrimination against telephone users in rural areas of the United States.
According to a statement by the legislators, "Uncompleted calls to rural areas continue to be a problem for many of the constituents we represent. While the FCC is taking action to pursue those entities responsible, this bipartisan resolution highlights the lingering prevalence of the problem and emphasizes the need for sustained efforts by the Commission to aggressively pursue those who violate call completion rules. We must protect the communications needs of our rural economies, public safety officials, families and all others residing in rural areas who depend on and deserve reliable telephone service."
The resolution is a simple resolution, meaning it will not be considered by the Senate and will not be passed into law, as might a joint resolution. Nevertheless, rural carriers should encourage their Representatives to support the measure. It had previously been introduced in the Senate by Amy Klobuchar (D-MN) in 2013 as S. Res 157.
FCC Launches Lifeline Database; Releases Final Lifeline Biennial Audit Plan
On April 3, 2014, the FCC issued a News Release announcing that the National Lifeline Accountability Database is now operational. The FCC said now that the database is on-line, no Lifeline provider can enroll a new subscriber without first confirming that the subscriber's household does not already receive Lifeline service. According to the FCC, the National Lifeline Accountability Database is a cornerstone of the agency's efforts to combat waste fraud and abuse in the Lifeline program, and already has identified $169 million in annualized savings by flagging existing duplicates for elimination while preventing enrollment of new duplicates.
Launched in 1985, the Lifeline program provides subsidies to make basic phone service — and the access it provides to jobs, family and emergency services — more affordable for low-income consumers. To preserve and improve Lifeline, the FCC in 2012 reformed and modernized the program to increase fiscal responsibility and toughen oversight of fast-growing subscriptions to wireless service.
A key goal of these reforms has been eliminating duplicate subscriptions through use of an automated database. According to the FCC, now that the database is on-line, no Lifeline provider can enroll a new subscriber without first confirming that the subscriber's household doesn't already receive Lifeline service. Implementation of the database has been a joint effort by the FCC, the fund's administrator—USAC—and the industry. Subscriber information has been loaded into the database by USAC in stages over recent months.
Separately, on April 2, 2014, the FCC's Wireline Competition Bureau released a 71 page Public Notice setting forth guidelines governing a new regimen of independent audits that Lifeline providers, receiving $5 million or more a year from the program, will be subjected to every two years. These comprehensive audits are in addition to the regular audits conducted by the program administrator. A list of providers covered by this new audit requirement is in Attachment 2 of the guidelines, which is available at
According to the Bureau, the independent audit firms conducting these biennial audits must plan their engagements by using the approved procedures outlined in the final Audit Plan. The independent audit firms must be licensed, certified public accounting firms and must conduct the audits consistent with Generally Accepted Government Auditing Standards (GAGAS). The audits are to be performed as agreed-upon procedures (AUP) attestations. In addition, to ensure compliance with the FCC's Lifeline requirements, USAC will conduct training for independent auditors performing the AUP engagements to ensure that the audits are performed in accordance with the Audit Plan. The independent auditors will be required to collect from the ETCs specific documents and completed questionnaires, which the independent auditors will inspect before conducting fieldwork testing and then preparing attestation reports.
ETCs receiving $5 million or more from the low-income program, as determined on a holding company basis taking into account all operating companies and affiliates, for calendar year 2013 will be subject to the first round of biennial audits. As detailed in the Audit Plan, the final attestation report for each audit must be submitted within one year after release of the final Audit Plan, which is April 2, 2015 for the first biennial audit.
The FCC began tackling the duplicates problem in mid-2011 by first clarifying that Lifeline subscriptions are limited to one per household, and directing USAC to manually scrub subscriber lists, state-by-state. According to the FCC, that process has resulted in $269 million in annualized savings during development of the database.
Law & Regulation
Tentative Agenda for April Open Meeting Announced
On April 2, 2014 FCC Chairman Tom Wheeler announced that the following items will be on the tentative agenda for the next open meeting scheduled for Wednesday, April 23, 2014:
- A Report and Order, Declaratory Ruling, Order, Memorandum Opinion and Order, and Seventh Order on Reconsideration taking significant steps to continue the implementation of the landmark reforms adopted in the 2011 USF/ICC Transformation Order to modernize universal service for the 21st century. Because the agenda title mentions the Mobility Fund, the FCC may address the Phase II rules in this vote, but it is not clear at this time.
- An accompanying Further Notice of Proposed Rulemaking proposes measures to update and further implement the framework adopted by the Commission in 2011.
- A Further Notice of Proposed Rulemaking that would implement an innovative three-tier spectrum sharing approach to make up to 150 megahertz of spectrum available for wireless broadband use in the 3550-3700 MHz band.
The Open Meeting is scheduled to commence at 10:30 a.m., and will be webcast live at www.fcc.gov/live .
Patent Troll Legislation Scheduled for Senate Mark-Up, Promptly Pushed Back Again
On April 7, 2014, legislative news outlet The Hill reported that the Senate Judiciary Committee was scheduled to consider legislation introduced by Chairman Patrick Leahy (D-Vt.) and Sen. Mike Lee (R-Utah) aimed at curbing "patent trolling" — the practice of amassing patents solely for the purpose of pursing (often meritless) patent infringement claims.
As we've reported in the past, rural carriers have been targeted by so-called patent trolls for certain DSL technologies employed in delivering telecommunications services.
The bill primarily combats patent trolling by allowing "fee-shifting," a provision which would require the loser of a patent infringement lawsuit to pay the winner's legal fees. This would provide monetary relief for those forced to defend against such claims in the event they turn out to be meritless. However, it could also have the unintended consequence of potentially discouraging legitimate suits.
The bill was pushed back for the third time just hours before its scheduled consideration on April 8, primarily because of continued disagreement over the "fee-shifting" provision. According to The Hill , Leahy indicated the Republicans are the cause for the delay: "Yesterday Senator Schumer circulated a proposal addressing a few contentious issues related to abuse of the patent system. We have not yet received constructive feedback from Republican Senators on the Judiciary Committee on that proposal," he said, noting the "extensive bipartisan negotiations over the past several weeks to find a compromise." John Cornyn (R-TX) responded, "Unfortunately this has developed into a fight between Senate Democrats. Sen. Leahy may have given up, but I am happy to keep discussing this bill with the White House and a majority of House Democrats, including [House Minority Leader] Nancy Pelosi who all supported strong fee shifting."
Senate Committee Holds Hearing on FCC Reporting Act
As this week's edition of the BloostonLaw Telecom Update went to press, the U.S. Senate Committee on Commerce, Science, and Transportation held an executive session to consider, among other things, the Federal Communications Commission Consolidated Reporting Act of 2013 ( Senate Bill 1379 ).
SB 1379 proposes to amend the Communications Act of 1934 to consolidate the FCC's reporting obligations in order to improve congressional oversight and reduce reporting burdens. It calls for the FCC to publish on its website and submit to the Committee on Energy and Commerce of the House of Representatives and the Committee on Commerce, Science, and Transportation of the Senate a report on the state of the communications marketplace, and makes a number of conforming amendments to reconcile the consolidation of a number of so-called redundant reports, including the ORBIT Act Report, Satellite Competition Report, the International Broadband Data Report, the Status of Competition in the Market for the Delivery of Video Programming Report, the Section 706 Report, the State of Competitive Market Conditions with Respect to Commercial Mobile Radio Services, and others.
Cincinnati Bell Announces its Departure from Wireless Business — Sells to Verizon
On Monday, April 7, 2014, Cincinnati Bell announced that it had entered into an agreement to sell its wireless spectrum to Verizon Wireless. In its announcement, Cincinnati Bell indicated that it expects to continue operating its wireless network for the next 8 – 12 months. Cincinnati Bell has also indicated that it is selling to Verizon because it feels that its customers "are best served by other wireless offerings in the market."
Interestingly enough, while Cincinnati Bell is exiting the wireless business, it is not selling its subscriber base to Verizon. Rather, its announcement advises subscribers that following the sale, they may transition their service to Verizon or any other carrier of their choice. In order to facilitate this transition, Cincinnati Bell has stated that it will waive all applicable termination fees and provide handset unlock codes so that handsets can be transitioned to Verizon or other carriers. However, until the transaction closes, Cincinnati Bell does not plan to release its customers from their contracts or provide unlock codes. For those of its customers with i-Wireless accounts, Cincinnati Bell has indicated that those customers with balances will need to exhaust those balances prior to Cincinnati Bell's discontinuance of operation — which is tentatively planned for sometime in the first quarter of 2015.
From a Verizon perspective, this transaction is interesting since Verizon has stated that it will take only a portion of the Cincinnati Bell spectrum holdings, which includes Cincinnati Bell's PCS and AWS spectrum in the Cincinnati and Dayton markets. The 700 MHz A-Block spectrum will be sold to Grain Management, an investment company in which former FCC Chairman William Kennard serves as an advisor. The conventional wisdom in the press is that Grain Management may ultimately sell this spectrum to T-Mobile — who recently purchased Verizon's 700 MHz A-Block spectrum.
Apr. 10 – Reply comments are due on AT&T Wire Center Trials Proposal.
Apr. 14 – Reply comments are due on Rural Broadband Experiments and Numbering Research.
Apr. 16 – Comments are due on Extension of Freeze of Separations Category Relationships and Cost Allocation Factors.
Apr. 21 – Reply comments on E-Rate modernization are due.
Apr. 23 – Reply comments are due on Extension of Freeze of Separations Category Relationships and Cost Allocation Factors.
May 1 – FCC Form 499-Q, Telecommunications Reporting Worksheet is due.
May 29 – Comments are due on the short form Tariff Review Plans.
May 31 – FCC Form 395, Employment Report, is due.
Jun. 16 – ILEC Tariff filings made on 15 days' notice are due.
Jun. 23 – Petitions to suspend or reject tariff filings made on 15 days' notice are due.
Jun. 24 – ILEC tariff filings made on 7 days' notice are due.
Jun. 26 – Replies to petitions to suspend or reject tariff filings made on 15 days' notice are due.
Jun. 26 – Petitions to suspend or reject tariff filings made on 7 days' notice are due.
Jun. 27 – Replies to petitions to suspend or reject tariff filings made on 7 days' notice are due.
Jul. 1 – FCC Form 481 (Carrier Annual Reporting Data Collection Form) is due.
Jul. 1 – Mobility Fund Phase I Auction Winner Annual Report is due.
Jul. 31 – FCC Form 507 (Universal Service Quarterly Line Count Update) is due.
Jul. 31 – Carrier Identification Code (CIC) Report is due.