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. 35||September 10, 2014|
Sprint and Verizon Continue Wave of Access Charge Suits
A number of local exchange carriers throughout the country have received, or have been threatened with, a complaint filed by Sprint and/or Verizon, in which the long distance carrier alleges that the local exchange carrier improperly billed access charges for calls that originated from or terminated to a wireless carrier customer. BloostonLaw is involved with responding to and developing a strategy for a number of these matters. If your company receives such a complaint, please feel free to contact us for assistance in preparing a response.
FCC Enters into Consent Decree with Verizon over CPNI Violations
On September 3, 2014, the FCC’s Enforcement Bureau entered into a consent decree with Verizon for $7,400,000 to settle “an investigation into the company’s use of personal consumer information for marketing purposes” – a.k.a., a violation of the FCC’s CPNI rules. Specifically, the Bureau indicated that its investigation “uncovered that Verizon failed to notify approximately two million new customers of their privacy rights, including how to opt out from having their personal information used in marketing campaigns, before the company accessed their personal information to market services to them.”
The FCC’s CPNI rules require carriers to, among other things, obtain each customer’s approval to use CPNI in marketing activities, either through (a) affirmative “opt-in” approvals or (b) written notice about how the company intends to use CPNI and a corresponding opportunity to “opt-out,” which is what Verizon had chosen to do. The opt-out course must be repeated bi-annually, and the CPNI rules require carriers to report any failures in the opt-out process within five days of being discovered.
Despite the FCC’s boast that the $7.4 million sum is “the largest such payment in FCC history for settling an investigation related solely to the privacy of telephone customers’ personal information,” a quick look at the math suggests Verizon may have gotten a pretty good deal. First, according to the Consent Decree, Verizon failed to notify approximately 2 million customers – which means the $7.4 million forfeiture represents about $3.70 per individual violation. Second, Verizon’s failures dated back as far as 2006 and continued until late 2012 – which means it must have failed to notify at least some of those 2 million customers more than once (recall that the opt-out notification requirement is bi-annual). Finally, Verizon also failed to notify the FCC of these problems until January 18, 2013, over four months after they discovered the problem when the rules require reporting within five days. Considered in this light, the $7.4 million pales in comparison to the FCC’s Omnibus CPNI Forfeiture of 2009, in which the FCC proposed forfeitures of $20,000 each for failing to timely file the annual March 1 CPNI certification.
Net Neutrality Continues to Heat Up as House Minority Leader Urges Title II Reclassification of Broadband Internet Services; Senate Judiciary Committee Plans Net Neutrality Hearing
On September 8, 2014, House Minority Leader Nancy Pelosi (D-Calif.) sent a letter to Chairman Wheeler urging the FCC to reclassify broadband Internet access services as telecommunications services, subject to common carrier regulation under Title II.
In the letter, Ms. Pelosi said “I believe the FCC should follow the [Court of Appeals for the District of Columbia]’s guidance and reclassify broadband as a Telecommunications Service under Title II of the Communications Act.” Doing so, according to the representative, would give the FC’ certainty to protect consumers from fraudulent billing practices and privacy infringements while maintaining the guarantee that Voice-over-Internet Protocol calls and other data will reach their destination without interference, as called for in the Network Compact.”
Ms. Pelosi joins the ranks of Senate Majority Leader Harry Reid, Sen. Ed Markey (D-Mass.), and other Senate Democrats who also voices support for Title II regulation of broadband over the summer.
The next day, Capitol Hill news outlet The Hill reported that the Senate Judiciary Committee will hold a hearing on September 17 on potential regulations on Internet service providers.
Witnesses have not been announced, but the Hill reports that Leahy “has been a supporter of strong regulations so the panel could turn to public interest advocates and tech company executives that have argued in favor of tough rules.” Leahy himself has previously written a bill with Rep. Doris Matsui (D-Calif.) that would force the FCC to ban so-called “fast lane” deals between Internet service companies and individual websites.
The use of “fast lane” deals and the classification of broadband as a Title II telecommunications service are both subjects of the FCC’s ongoing Open Internet proceeding. Reply comments on the Open Internet FNPRM are due on September 15.
FCC Provides Information on Payment Methods, Procedures for FY 2014 Regulatory Fees
On September 5, the FCC released a Public Notice providing information on payment methods and procedures for the collection of Fiscal Year 2014 regulatory fees. As we reported in a previous edition of the BloostonLaw Telecom Update, regulatory fee payments must be received by the FCC by no later than 11:59 PM, EDT, on September 23, 2014.
Fees must be paid via the FCC’s online Fee Filer system; payments in the form of checks, money orders, and cashier’s checks are no longer accepted. A Form 159-E voucher will only be accepted when payment is being made by wire transfer. According to the Public Notice, the use of the online Fee Filer system for filing regulatory fees has not changed since the process was first initiated in FY 2009: companies must first enter the Commission’s Fee Filer system with a valid FRN and password, and follow the online prompts to review their data and submit an electronic fee payment.
Hardcopy/paper bills are also no longer mailed by the FCC; however, bills are available for viewing in the “Regulatory Fee” link of Fee Filer.
Law & Regulation
FCC Announces Tentative Agenda for September 30 Open Meeting
The FCC has announced that the following items will tentatively be on the agenda for the next open meeting, which is currently scheduled for Tuesday, September 30, 2014:
- Sports Blackout Rules: The Commission will consider a Report and Order that would eliminate the Commission’s sports blackout rules, which can prevent consumers from watching their teams’ games on local television.
- Comprehensive Review of Licensing and Operating Rules for Satellite Services: The Commission will consider a Further Notice of Proposed Rulemaking to streamline and update Part 25 of the Commission’s rules, which governs licensing and operation of space stations and earth stations for the provision of satellite communication services. These proposals will amend, clarify or eliminate numerous rule provisions and reduce regulatory burdens.
- Part 15 NPRM: The Commission will consider a Notice of Proposed Rulemaking to revise rules for unlicensed operations in the TV bands and new 600 MHz Band, including fixed and personal/portable white space devices and unlicensed microphones. The proposed changes and new rules are intended to allow more robust and spectrally efficient unlicensed operations without increasing the risk of harmful interference to other users.
- Wireless Microphones NPRM: The Commission will consider a Notice of Proposed Rulemaking to address the needs of wireless microphone users, while recognizing that they must share spectrum with other wireless uses in an increasingly crowded spectral environment.
The Open Meeting is scheduled to commence at 10:30 a.m. in Room TW-C305, at 445 12th Street, S.W., Washington, D.C., and will be shown live at FCC.gov/live.
11th Circuit to Rehear Cell-Site Location Data Case
On September 4, the Washington Post reported that the U.S. Court of Appeals for the Eleventh Circuit has agreed to rehear the United States v. Quartavious Davis case ‘en banc,’ or with the full judicial bench. The case was originally heard in June by a panel of three judges, who held that that cell-site location data is protected by the Fourth Amendment, requiring law enforcement officials to obtain a warrant before obtaining it.
Davis was originally convicted on multiple counts of robbery, conspiracy, and knowing possession of a firearm in furtherance of a crime, and appealed his conviction principally on the ground that the court should not have admitted stored cell site location information that was obtained without a warrant (in violation of his Fourth Amendment rights). Although the court ultimately denied Davis’ motion to exclude the data, the 11th Circuit held “that cell site location information is within the subscriber’s reasonable expectation of privacy. The obtaining of that data without a warrant is a Fourth Amendment violation.”
The Post further reported that a panel of the Fourth Circuit will also be considering the same issue in a future argument in United States v. Graham .
Internet Content Providers Protest Net Neutrality “Fast Lanes”
Article loading . . .
Today a number of major web content providers, including Netflix, Meetup, Reddit and Etsy, are voicing their displeasure with the FCC’s latest attempt at implementing Net Neutrality rules by displaying “loading” symbols in pop-ups, on banners, and generally around their websites.
The symbols are meant to invoke the specter of “life in the slow lane,” the prophesied doom that will be ushered in if the latest Net Neutrality FNPRM, which among other things proposes to permit service providers to strike deals for faster service above an established baseline, is adopted. Though the websites taking part in the protest will display the symbols on content and web banners, internet traffic will not actually be slowed.
The protest was reportedly organized by activist groups Demand Progress, Engine, Free Press Action Fund and Fight for the Future. According to Meetup general counsel Davis Pashman, “The FCC’s current proposal surrounding the issue of net neutrality threatens the concept of a free and open Internet,” and “would create a two-tiered Internet with slow lanes (for most companies) and fast lanes (for those willing and able to pay for it). This two-tiered system fundamentally alters the nature of the Internet as an open platform for innovation and entrepreneurship and threatens the economic growth that it has supported.”
In response, the head of the Information Technology and Innovation Foundation (a tech industry trade group) reportedly called the protest a “scare tactic” that uses “the imaginary boogie man of ‘slow lanes’ ” to gain support for utility-styles rules for the Internet. “This ‘technological McCarthyism’ is a dangerous game and has no place in broadband regulation narrowly, or tech policy more broadly,” said Robert Atkinson, founder and president of the group, in a statement.
Sep. 10 – Deadline to revise CMRS subscriber data for FY2014 regulatory fees.
Sep. 12 – Auction 97 short-form application filing window closes.
Sep. 15 – Reply comments are due on the Open Internet NPRM.
Sep. 15 – Reply comments are due refreshing the record on the 2010 Broadband NOI.
Sep. 15 – Comments are due on E-Rate Modernization NPRM.
Sep. 19 – Reply comments are due on Tenth Broadband Report Notice of Inquiry.
Sep. 19 – Comments are due on fifth Congressional White Paper.
Sep. 23 – Annual Regulatory Fee Payments for Fiscal Year 2014 are due.
Sep. 29 – Reply comments are due on Rural Broadband Experiment FNPRM.
Sep. 30 – Reply comments are due on E-Rate Modernization NPRM.
Sep. 30 – FCC Form 396-C (MVPD EEO Program Annual Report).
Oct. 1 – FCC Form 477 due (Local Competition and Broadband Reporting).
Oct. 6 – Comments due on IP Captioning proceeding.
Oct. 14 – Deadline for applications for rural broadband experiments.
Oct. 15 – Auction 97 upfront payments are due.
Nov. 3 – FCC Form 499-Q (Quarterly Telecommunications Reporting Worksheet) is due.
Nov. 3 – Reply comments are due on IP Captioning proceeding.
Nov. 13 – Auction 97 begins.