Welcome to the latest edition of Arent Fox’s This Week in Telecom, our weekly newsletter designed to keep you apprised of recent developments in telecommunications policy, legislation, and litigation. Follow our Telecom Group on Twitter! Click here.

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Federal Communications Commission (FCC) Announcements

• The FCC has released the final Agenda for its next open meeting to be held June 9, 2011, at 10:30 am Eastern. It contains only two of the four items previously noticed: a Report and Order on streamlined tariff filing procedures; and a Second Report and Order adopting rules to mitigate interference between the 17/24 GHz Broadcasting-Satellite Service (BSS) space stations and current and future Direct Broadcasting Service (DBS) space stations. To view the final Agenda, click here.
• Oppositions to Petitions to Deny the AT&T/T-Mobile merger application are due June 10, 2011, and Replies in support of Petitions are due June 20, 2011. Docket No. WT 11-65. To see the Public Notice, click here.
• Reply Comments on the “need for speed” inquiry are due June 16, 2011. The Public Notice is available here.

Please contact Ross Buntrock, Alan Fishel, Michael Hazzard, or Jon Canis (contact information below) for further information.

Federal Trade Commission (FTC) Developments

• On May 5, 2011, the FTC obtained a temporary restraining order from the US District Court for the District of New Jersey enjoining a number of related companies and individuals from deceptive marketing practices surrounding the sale of prepaid calling cards. According to the FTC’s complaint, the defendants marketed prepaid international calling cards that failed to deliver the advertised number of calling minutes. Indeed, according to FTC testing, more than 98% of the cards failed to deliver the number of minutes advertised, and on average the cards provided of only 45% of the advertised minutes. The complaint also alleges that the cards carried hidden fees, such as “hang-up fees” and weekly fees. FTC v. Millennium Telecard, Inc., et al., No. 2:11-cv-02497 (JLL) (D.N.J.).

  A copy of the complaint can be found here.

  A copy of the Temporary Restraining Order can be found here.

  A copy of the FTC’s press release can be found here.

• On May 26, 2011, the FTC announced that it will be updating its advisory guide on how federal advertising law applies to marketing and sales on the Internet. It last issued guidance on the topic in 2000, in a document entitled “Dot Com Disclosures: Information About Online Advertising.” The agency seeks public comment on possible revisions to the guide, particularly on the technical and legal issues that marketing entities and consumer advocates would like to see addressed. Comments may be submitted until July 11, 2011.

  A copy of the Staff Invitation for comments on the Dot Com Disclosure Business Guidance Publication can be found here.

  A copy of the FTC’s 2000 guide, “Dot Com Disclosures,” can be found here.

  Interested parties may be submit comments electronically here.

Please contact Ross Buntrock, Alan Fishel, Stephanie Joyce, or J. Isaac Himowitz (contact information below) for further information.

Developments in Intercarrier Compensation

• On May 31, 2011, the California Public Utilities Commission granted the joint motion of AT&T California and Sprint PCS to dismiss AT&T’s 2009 complaint after the parties reached a multi-state settlement agreement. AT&T had alleged that Sprint was seeking to avoid the payment of access charges by deliberately routing interMTA wireless traffic over local trunks. AT&T also alleged that Sprint failed to update the billing factor used to measure this traffic. This case had been stayed to allow the parties time to negotiate the settlement, the terms of which were not disclosed. Docket No. 09-09-003.
• Also on May 31, Staff of the North Carolina Utilities Commission (NCUC) filed a report urging the Commissioners to investigate whether local exchange carriers (LECs) should be compelled to reduce their intrastate access rates, and if so, whether a state universal service fund (USF) should be established. The NCUC has been considering intrastate access charge reform through the informal “Access Charges Working Group” that was established after Sprint petitioned it in 2009 to direct North Carolina incumbent LECs to reduce their intrastate access rates, which Sprint called “anti-competitive and antiquated” subsidies. On March 15, 2011, the NCUC held that the state legislature had implicitly granted it the authority to establish a state USF. In the report, Staff recommended that the NCUC establish a single evidentiary proceeding to address both access reform and USF matters. Staff proposed holding a hearing on October 18, 2011 on these two issues, with direct testimony due August 10, and rebuttal testimony due September 27. Docket No. P-100, Sub 167.

Please contact Ross Buntrock, Jon Canis, Michael Hazzard, Stephanie Joyce, or Adam Bowser (contact information below) for further information regarding intercarrier compensation matters.

Compliance Notes

• Carriers that provided service between the United States and foreign points in the 2010 calendar year are required to file their annual International Traffic Data report by July 31, 2011. Carriers required to file this report include resellers that bill for international service that was handled by an underlying carrier. Information regarding this filing, including past reports and the filing manual, may be found here.
• Carriers that are certified in California and have annual gross intrastate revenues in excess of $750,000 are required to pay the California Public Utilities Commission’s Annual User fee on a quarterly basis. The filing for the second quarter of 2011 is due July 15, 2011. More information on this filing may be found here.
• The Universal Service contribution factor for the second quarter of 2011 is 14.9%. A copy of the notice can be found here.
• Voice over Internet Protocol (VoIP) providers and Commercial Mobile Radio Service (CMRS) providers who rely on traffic studies to report interstate revenues on FCC Form 499-Q must submit these studies by August 1, 2011 to the Universal Service Administrative Company (USAC) and the Chief, Industry Analysis and Technology Division of the FCC. The instructions to Form 499-A, which lists filing deadlines at page 5, can be found here.

Please contact Ross Buntrock, Jon Canis, Michael Hazzard, or J. Isaac Himowitz (contact information below) for further information regarding compliance matters.

Stimulus This Week

• Quarterly financial reports and Performance Progress Reports (PPR) for Broadband Technology Opportunities Program (BTOP) grant recipients are due July 30, 2011 for the second quarter of 2011.

  The quarterly Performance Progress Reports for Broadband Sustainability Projects can be found here.

  The quarterly Performance Progress Reports for projects involving Public Computer Centers can be found here.

  The quarterly Performance Progress Reports for Broadband Infrastructure Projects can be found here.

• The Rural Utilities Service (RUS) is still accepting applications for broadband access loans. These loans will be funded by the Food, Conservation, and Energy Act of 2008, commonly known as the 2008 Farm Bill. RUS currently estimates that $700 million may be available from prior appropriations, but this figure may change based upon ultimate resolution of the federal budget. RUS plans to publish a subsequent notice that will identify the amount of funding available upon the enactment of the 2011 Appropriations Act. It has stated that “expenses incurred in developing the application will be at the applicant’s own risk.” The minimum loan amount is $100,000 and the maximum is $100 million. A copy of the Federal Register notice regarding the loans can be found here.

Please contact Ross Buntrock, Jon Canis, Alan Fishel, Jeffrey Rummel, or Stephanie Joyce (contact information below) for further information regarding stimulus funding.

Broadband News

• Two reports on Internet usage were released last week, both of which highlight the growth opportunities in the Internet. On June 1, 2011, Cisco released a report predicting that the “total amount of global Internet traffic will quadruple by 2015 and reach 966 exabytes per year.” Putting that into perspective, 1 exabyte is 1 billion gigabytes. Cisco sees this growth driven by more devices, more users, faster speeds, and more video online. Cisco predicts peer-to-peer file sharing will decrease from 40% of all traffic to 16%, among other findings. Similarly, a May 31, 2011 report from the Pew Research Center’s Internet and American Life Project found that 24% of American adults have placed telephone calls over the Internet and “[o]n any given day 5% of internet users are going online to place phone calls.” Cisco’s report is available here. The Pew Center’s report is available here.

Please contact Ross Buntrock, Alan Fishel, Michael Hazzard, Jeffrey Rummel, or Jason Koslofsky (contact information below) for further information.

Telecom Privacy News

• The FTC and the Department of Justice’s Office for Victims of Crime will host “Stolen Futures: A Forum on Child Identity Theft,” on July 12, 2011, at the FTC Conference facility at 601 New Jersey Avenue NW, Washington DC, 20001. The forum will run from 8:30 am to 5:00 pm Eastern, and according to the tentative agenda will feature several guest speakers, including Kathleen Styles, Chief Privacy Officer of the US Department of Education. For more information, click here. To view the agenda, click here.

Please contact Ross Buntrock, Jon Canis, Alan Fishel, Michael Hazzard, Jeffrey Rummel, or G. David Carter (contact information below) for further information.

In the Courts

• On May 31, 2011, the United States Supreme Court invited the Acting Solicitor General to file a brief articulating the Government’s position on whether the U.S. Court of Appeals for the Third Circuit properly dismissed a putative class action lawsuit against various cell phone makers, wireless service providers, and related trade associations for failing to protect consumers from cell phones’ allegedly harmful radio frequency emissions. In its October 2010 decision, the Third Circuit concluded that such suits, based principally on state-law tort claims, were preempted because the FCC “is in a better position to monitor and assess the science behind RF radiation than juries in individual cases.” Farina v. Nokia Inc., No. 10-1064.

• On May 20, 2011, the US District Court for the District of Maryland refused to dismiss the State of Maryland’s Telephone Consumer Protection Act (TCPA) lawsuit against various parties that participated in “political robocalls” last Election Day, November 2, 2010. Parties affiliated with Republican challenger Robert Ehrlich Jr.’s campaign retained Robodial.org, which auto-dialed over a hundred thousand registered Democrats to give the following pre-recorded message: “Hello. I’m calling to let everyone know that Governor O’Malley and President Obama have been successful. Our goals have been met. The polls were correct and we took it back. We’re okay. Relax. Everything is fine. The only thing left is to watch it on TV tonight. Congratulations and thank you.”

  The State claims that the calls violated TCPA, because they did not identify who was making the call, on whose behalf the calls were made, or the caller’s telephone number or address. The defendants moved to dismiss the suit on the grounds that TCPA is unconstitutional as applied, and that the calls fell within the “not made for a commercial purpose” exception in the statute. The federal court denied the motion, finding that the exemption for non-commercial calls under one section of TCPA did not excuse their failure to follow the other TCPA disclosure requirements. The court likewise rejected the constitutional arguments, finding that TCPA is content-neutral and thus does not “place greater restrictions on the speech of the defendants than those placed upon anyone else using an automatic dialer.” State of Maryland v. Universal Elections, Civ. No. 10-3183 (D. Md.).

Please contact Ross Buntrock, Jon Canis, Michael Hazzard, Stephanie Joyce, or Joseph Bowser (contact information below) for further information.

Legislative Outlook

• The Senate Commerce Committee will hold an Executive Session on June 8, 2011, at 10:00 am Eastern in 253 Russell Senate Office Building, to consider several items of legislation including S. 911, the Public Safety Spectrum and Wireless Innovation Act. Introduced on May 9, 2011, by Sen. John “Jay” Rockefeller IV, Committee Chair, the bill is formally titled the “Strengthening Public-safety and Enhancing Communications Through Reform, Utilization, and Modernization Act” or “SPECTRUM Act”. It states that Congress should pass “bipartisan legislation to strengthen public safety and to enhance wireless communications”. To view the bill, click here. For more information about the Executive Session, click here.

Please contact Stephanie Joyce (contact information below) for further information.

Upcoming Events

• Chairman Genachowski will be the keynote speaker at the Federal Communications Bar Association (FCBA) luncheon on June 10, 2011, at 12:00 pm Eastern in the Capital Hilton, 1001 16th Street, NW, Washington, DC. The lunch will be held in conjunction with the FCBA annual meeting. For more information or to register, click here.
• The FCBA 15th Annual Golf Tournament will take place on June 20, 2011 at the Country Club at Woodmore in Mitchellville, Maryland. For more information or to register, please click here.

Please contact Stephanie Joyce (contact information below) for further information.