Selected portions of the BloostonLaw Telecom Update, a newsletter from the Law Offices of Blooston, Mordkofsky, Dickens, Duffy & Prendergast, LLP are reproduced in this section with the firm's permission. 
Headlines Patent Troll Attacking Small DSL Providers During December, a Texas law firm representing an entity located in the Philadelphia suburbs appears to have sent over 100 letters to various rural telephone companies, Internet service providers and others alleging that they were in violation of six DSL-related patents. The Philadelphia firm appears to have bought several older Bell Labs and other patents that may or may not be applicable to current DSL equipment and services. In at least several instances, the December letters have “ripened” into lawsuits in various U.S. District Courts around the country. The Philadelphia firm appears to have a history of buying up cheap older patents, threatening or filing lawsuits claiming infringement of those patents, and seeking monetary settlements to go away. Their current strategy appears to be to find smaller firms that are more likely to be reluctant to undertake the effort and cost of defending against a patent infringement lawsuit. Because it apparently cannot claim patent infringement damages for the period prior to the December letter, the Philadelphia firm appears to be seeking “settlements” that would entail a percentage of the alleged violator’s future DSL-related revenues. To the extent that they represent a valid claim, patent suits of this nature should be filed against DSL equipment manufacturers, who should have licensed all necessary patents and included the cost of such licenses in their prices, or determined that particular patents were not valid or not applicable to their products. Given that the Philadelphia firm has apparently elected not to attack manufacturers that employ engineers who understand which patents were or were not included in their products, the affected small service providers will need to obtain assistance and indemnification from their vendors. Unfortunately, initial contacts with several DSL vendors have not been met with commitments of vigorous support. An additional complication is that some vendors of existing DSL equipment have gone out of business, and it is unclear what obligations their successors (if any) may have. BloostonLaw is working with Western Telecommunications Alliance, National Telecommunications Cooperative Association, OPASTCO and Eastern Rural Telecommunications Association and certain patent attorneys to assist the several rural telephone companies and affiliates that have been targeted to date. There may or may not be some common responses and defenses that can be made with respect to the cookie-cutter patent lawsuits that are being filed. Whereas it may make sense for some small companies to settle with patent trolls to avoid expensive lawsuits, there is a great deal of reluctance to reward any potential abuse of the patent process and to open the road for many other small DSL providers to be attacked in the future. For those clients not presently affected, the best advice is to make sure that all future equipment acquisitions include express contract language: (a) warranting that the vendor has licensed any and all applicable patents;
(b) promising that the vendor will indemnify the purchaser for any and all patent infringement damages or settlements and patent licensing fees with respect to the equipment; and
(c) promising that the vendor will take over, defend and bear the full cost of any and all patent infringement litigation with respect to the equipment.
To the extent possible, clients should purchase DSL equipment from companies likely to remain in business during the foreseeable future. FCC Grants Disputed 700 MHz Licenses after 10-Year Delay After more than a decade of uncertainty, U.S. Court of Appeals litigation, and an FCC forfeiture order arising from alleged unlawful communications with another bidder during 700 MHz Auction No. 44 (2002), the FCC last week issued Memorandum Opinion and Order disposing of the remaining protests filed against Star Wireless, LLC, clearing the way for grant of four Lower 700 MHz C-Block CMA licenses in Wisconsin and Iowa markets to Star. In doing so, the FCC appears to have identified limits on who can protest auction applications. Our clients that participated in the first Lower 700 MHz band auction will likely recall the company's saga, which began when the FCC Enforcement Bureau fined Star and another bidder $100,000 each for engaging in prohibited communications shortly after the start of the auction. The companies sought reconsideration and review of their 2003 forfeiture order and in 2007, the Commission upheld the Bureau's finding of liability, but it reduced each company's fine to $75,000 in recognition of their history of compliance with the rules. Because of the seriousness of an anti-collusion rule violation, and wanting to avoid a black mark on its record, Star and its principal continued their fight to the U.S. Court of Appeals for the DC Circuit. The court upheld the FCC's reduced fine and it dismissed Star's claim that the Commission's rules violated Star's commercial speech rights. Star paid its fine and it was allowed to amend its Auction 44 long-form application in April of 2010. A day after the deadline for filing protests, a group of companies along with Warren C. Havens submitted an untimely petition to deny Star's application, claiming that Star was no longer eligible for the very small business bid credit it had applied for back in 2003, and that changing to a small business bid credit constituted a prohibited major amendment to the long-form application. In last week's ruling, the FCC denied the Havens petition both on procedural grounds and on the merits. At the outset, the FCC stated that the petition was filed one day late and that Havens did not have "standing" to challenge Star's long-form application. Finally, even if the Petitioners did have standing, their argument that Star's amendment to the pending application was a major amendment – and therefore impermissible - was incorrect. With respect to the untimeliness of the petition, the FCC noted that Mr. Havens had filed petitions after the filing deadline on numerous occasions in the past, always citing technical issues with the FCC's electronic filing system. As in prior cases, the FCC found insufficient grounds to waive its rules and accept the late-filed petition. The FCC also concluded that Havens and the other petitioners (companies controlled by Havens) did not have standing to challenge Star's application. In reaching this conclusion, the FCC stated that while a bidder has a right to a valid auction process, the courts have maintained that "a disappointed bidder . . . must demonstrate 'that it was able and ready to bid and that the decision of the Commission prevented it from doing so on an equal basis.'" Neither Havens nor any of the other petitioners had filed a short-form application to participate in Auction No. 44, so none would have been eligible to bid on any of the Lower 700 MHz C-Block licenses that Star won in the auction (which included CMA 186 –Green Bay, WI; CMA 195 – Cedar Rapids, IA; CMA 711 – Wisconsin 4-Marinette; and CMA 717 – Wisconsin 10-Door). The fact that the petitioners might provide competitive services against Star likewise was found to be not enough to give the Petitioners standing to challenge the Star long-form application. Even with what must have been significant legal bills over the years, Star appears to have gained a valuable asset. The Company had net winning bids of just $50,250 for the Green Bay license; $38,250 for the Cedar Rapids license; $25,500 for WI-4 Marinette; and $44,250 for WI-10 Door. It is expected that the spectrum would be valued at a much higher level today. Wireless Surveillance Camera Vendor Cited for Sale of Unauthorized Wireless Equipment Based upon an interference complaint from the Federal Aviation Administration ("FAA") pertaining to its Terminal Doppler Weather Radar ("TDWR") system in Las Vegas, Nevada, the FCC's Enforcement Bureau
traced the source of the interference to a 5.8 GHz wireless camera surveillance system that had been installed at a public storage facility in Henderson, Nevada. Upon inspection of the equipment, the FCC's field agents determined that it neither contained an FCC Identification Number nor displayed the name of the manufacturer. The FCC was able to trace the equipment back to Security-Cameras-CCTV.com ("CCTV.com") through information provided by the vendor that had installed the equipment. The FCC issued a citation against CCTV.com since it currently does not hold an FCC permit. The FCC is required to notify CCTV.com of the violation before it may issue a fine. If CCTV.com repeats this conduct, it will be subject to fines and other sanctions. Additionally, the FCC has requested information from CCTV.com regarding the distribution of this non-compliant equipment. A failure to respond to the FCC's inquiry could lead to substantial fines. The FCC is concerned that other equipment sold by CCTV.com could likewise be noncompliant equipment certification requirement and cause interference to licensed and/or Federal government/US military operations. As more of our clients expand their business operations to include the sale of wireless solutions, it is important to ensure that any equipment provided as part of that solution has an FCC certification /equipment authorization. This is because non-compliant equipment is not tested and could be prone to causing harmful interference to licensed and/or Federal government operations.
Law & Regulation FCC Issues Warning to Comply with CPNI Certification by March 1 The FCC's Enforcement Bureau has issued an Enforcement Advisory to remind telecommunications carriers and interconnected Voice over Internet Protocol (VoIP) providers of their obligation to file, by March 1, their annual reports certifying compliance with the Commission's rules protecting Customer Proprietary Network Information (CPNI). When Enforcement issues such warnings, failure to comply is usually met by significant fines. CPNI includes certain personal information that carriers have about their customers as a result of their business relationship (e.g., phone numbers called; the frequency, duration, and timing of such calls; and any services purchased by the consumer, such as call waiting). In prior years, companies that have failed to file this annual certification on time, or that have filed certificates that failed to comply with the FCC's requirements in material respects, have been fined. Clients are also warned that failure to follow the CPNI procedures described in their annual certifications can give rise to FCC enforcement actions for false statements or misrepresentation. Carriers should review and complete their "Annual Certification of CPNI Compliance" for 2012, and arrange for it to be filed with the FCC by Friday, March 1, 2013. Note that the annual certification should include the following three required Exhibits: (a) a detailed Statement Explaining How the Company's Operating Procedures Ensure Compliance with the FCC'S CPNI Rules to reflect the Company's policies and information;
(b) a Statement of Actions Taken against Data Brokers; and
(c) a Summary of Customer Complaints Regarding Unauthorized Release of CPNI.
A company officer with personal knowledge that the company has established operating procedures adequate to ensure compliance with the rules MUST execute the Certification, place a copy of the Certification and accompanying Exhibits in the Company's CPNI Compliance Records, and file the certification with the FCC in the correct fashion. Our clients can forward the original to BloostonLaw in time for the firm to make the filing with the FCC by March 1, if desired. We ask that any filings be forwarded to us by Monday, February 25 if possible. BloostonLaw has sent draft 2012 CPNI Certification templates to all the clients that it assisted last year, and is prepared to help those and any other clients meet this requirement, which we expect will be strictly enforced, by assisting with preparation of their certification filing; reviewing the filing to make sure that the required showings are made; filing the certification with the FCC, and obtaining a proof-of-filing copy for your records. Clients interested in obtaining BloostonLaw's CPNI compliance manual should contact Gerry Duffy (202-828-5528) or Mary Sisak (202-828-5554). Note: the FCC has in the past cross-checked CPNI certifications and the FCC Form 499-A Telecom Reporting Worksheet that must be filed by April 1 of each year. If you have filed one of these forms, please make sure that you file the other in timely fashion.
Industry Another Possible Roller Coaster Ride for Wireless Profits on Smartphones Are the wireless carriers in for another roller coaster ride with profits despite large sales of Smartphones? According to an on-line story in CNN Money, by David Goldman, they could be: With improved technology providing customers with seemingly constant upgrades to Smartphones (especially iPhones), consumers are in a buying mood, resulting in record high sales last quarter. AT&T indicated they sold 10.2 million devices last quarter and Verizon activated 9.8 million Smartphones, mostly iPhones. However, by offering unlimited plans and other freebies, the carriers find that profits often don't match the impressive sales. The iPhone's typical subsidy runs about $400 per device, which limits the profit on the devices. Some industry analysts predict that the Smartphone craze is about to run its course. Rather than making improvements in technology sometimes twice a year, the changes may be more incremental. Thus the roller coaster ride of sales and profits for these devices could at least slow down to a steady cruise. Lawrence NJ is First Town in State to Privatize 911 PSAP The Times of Trenton and NJ.com are reporting that Lawrence, New Jersey is the first locality in the state to privatize its PSAP/public safety dispatch services. The move, which was approved by a unanimous vote of the Town Council, is designed to allow Lawrence to save over $1.1 million over the next five years. The contract to provide dispatch services was awarded to iXP Corp. The Council stated that the cost savings are significant because police officers must be used to backfill dispatcher staffing shortages when Lawrence would be better served by having those officers on the street. Like public safety employees, personnel hired by iXP Corp will undergo rigorous training and background checks.
Deadlines FEBRUARY 1: FCC FORM 502, NUMBER UTILIZATION AND FORECAST REPORT. Any wireless or wireline carrier ( including paging companies ) that have received number blocks—including 100, 1,000, or 10,000 number blocks—from the North American Numbering Plan Administrator (NANPA), a Pooling Administrator, or from another carrier, must file Form 502 by February 1. Carriers porting numbers for the purpose of transferring an established customer's service to another service provider must also report, but the carrier receiving numbers through porting does not. Resold services should also be treated like ported numbers, meaning the carrier transferring the resold service to another carrier is required to report those numbers but the carrier receiving such numbers should not report them. Reporting carriers are required to include their FCC Registration Number (FRN). Reporting carriers file utilization and forecast reports semiannually on or before February 1 for the preceding six-month reporting period ending December 31, and on or before August 1 for the preceding six-month reporting period ending June 30.
Deadlines At-A-Glance Jan. 28 – Deadline for comments on NTCA and AT&T petitions on transitioning voice networks to internet protocol. Jan. 28 – Comments on Connect America Fund Phase I FNPRM due. Jan. 29 – Comments on Next Generation 911; Text-to-911(Section III.A) are due. Jan. 31 – Report of extension of credit to federal candidates. Jan. 31 – Carrier Identification (CIC) code reports are due. Jan. 31 – FCC open meeting. Jan. 31 – Deadline for ETCs to report to the FCC, USAC & tribal governments (where appropriate) results of their efforts to re-certify Lifeline subscribers (WC Docket Nos. 11-42, 03-109, 12-23, and CC Docket No. 96-45). Feb. 1 – FCC Form 499-Q, Telecommunications Reporting Worksheet, is due. Feb. 1 – FCC Form 502, Number Utilization and Forecast Report, is due. Feb. 8 – Comments for Next Generation 911; Text-to-911 (Section III.A) are due. Feb. 8 – Electronic filing deadline for Form 497 for carriers seeking support for the preceding month and wishing to receive reimbursement by month's end. Feb. 11 – Reply Comments on Connect America Fund Phase I FNPRM due. Feb. 11 – Comments for sections IV.A and IV.C of Special Access FNPRM are due. Feb. 11 – Comments on NCTC Waiver of FCC Rule Section 36.605 are due. Feb. 19 – Comments for CAF Phase II Eligibility Methodology are due. Feb. 19 – Comments on Remote Areas Fund are due. Feb 25 – USTelecom Petition for Declaratory Ruling comments are due. Feb. 26 – Reply Comments on NCTC Waiver of FCC Rule Section 36.505 are due. Mar. 1 – Copyright statement of accounts form for cable companies is due. Mar. 1 – CPNI Annual Certification is due. Mar. 1 – FCC Form 477, Local Competition & Broadband Reporting Form, is due. Mar. 4 - Reply Comments for CAF Phase II Eligibility Methodology are due. Mar. 11 – Comments for Next Generation 911; Text-to-911 Other Sections are due. Mar. 11 – Deadline for Paperwork Reduction Act (PRA) comments on ways to further reduce the information collection burden on small business concerns with fewer than 25 employees. OMB Control No. 3060-0562. Mar. 12 – Deadline for reply comments on USTelecom Petition for Declaratory Ruling. Mar. 12 –Reply comments on Comments for sections IV.A and IV.C of Special Access FNPRM are due. Mar. 18 – Reply Comments on Remote Area Fund are due. Mar. 25 – Comments for Interstate Inmate Calling Rate Proceeding are due. Apr. 9 – Reply Comments for Next Generation 911; Text-to-911 (Other Sections) are due. Apr. 22 – Reply Comments for Interstate Inmate Calling Rate Proceeding are due. | 
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