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.

We’ve added a new section! See New Markets: SmartGrid and E-Health below.

We wish each of you a wonderful Thanksgiving holiday.

Jump to a Topic:
FCC Announcements l The Mobile Market l FTC and Privacy Regulation l New Markets: SmartGrid and E-Health l Intercarrier Compensation l Compliance Notes l Broadband News l In the Courts l Legislative Outlook l Events

Federal Communications Commission (FCC) Announcements

• The FCC has released the Tentative Agenda for the next Open Meeting to be held November 30, 2011, at 10:30 am Eastern. It contains two items: a Report and Order allocating spectrum for interactive medical devices; and a presentation on the Commission’s recent initiatives to increase broadband adoption. To view the Tentative Agenda, click here.
• The FCC has released its Preliminary Plan for Retrospective Analysis of Existing Rules in compliance with Executive Order 13579, issued July 11, 2011, which requires federal agencies to develop a plan for the periodic review of their regulations and to determine whether they may be streamlined, expanded, or eliminated. To view the Preliminary Plan, click here.
• Comments on the FCC Notice of Proposed Rulemaking on Next-Generation 911 (NG911) service are due December 12, 2011, and Reply Comments are due January 10, 2012. To view the Federal Register notice, click here. To read the NPRM, click here.

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

The Mobile Market

• Special Master Richard Levie, who is overseeing aspects of the lawsuits to block the AT&T/T-Mobile merger, is considering imposing time limits on trial presentations, but has not yet made a final decision on how to implement them. In a recent order, he noted that the trial, which is scheduled to begin February 13, 2012, will likely last four to six weeks, and that Judge Huvelle wants trial to conclude in March. The Department of Justice (DOJ) has proposed limiting each side to 20 fact witnesses, while AT&T and T-Mobile have suggested a time limitation rather a limit on the number of witnesses. Special Master Levie has ordered the parties to begin producing lists of possible fact witnesses that would be called at trial. DOJ was scheduled to provide its first list of potential witnesses on November 16. Sprint Nextel Corp. v. AT&T Inc., No. 1:11-cv-1600 and consolidated cases (D.D.C.).
• Responses to the FCC Wireless Telecommunications Bureau call for comments on the state of competition in the mobile wireless industry are due December 5, 2011, and Reply Comments are due December 20, 2011. The full public notice is available here.

Please contact Ross Buntrock, Michael Hazzard, or G. David Carter (contact information below) for further information.

Federal Trade Commission (FTC) and Privacy Regulation

• On November 13, 2011, President Obama and representatives from the Asia-Pacific Economic Cooperation (APEC) forum endorsed a new initiative to harmonize cross-border data privacy protection among members of APEC. The APEC Cross-Border Privacy Rules are designed to enhance the protection of consumer data that moves between the United States and other APEC members. Developed with the help of the FTC and the Department of Commerce, the new privacy rules present a self-regulatory code of conduct designed to create more consistent privacy protections for consumers when their data moves between countries with different privacy regimes in the APEC region. More information regarding the new APEC Cross-Border Privacy Rules can be found here.
• Comments on proposed changes to the FTC Children’s Online Privacy Protection Rule are due November 28, 2011. The FTC press release about the proceeding is available here. The text of the Federal Register notice is available here.

Please contact Ross Buntrock, Alan Fishel, Stephanie Joyce, or Jason Koslosfky (contact information below) for further information.

New Markets: SmartGrid and E-Health

• PositiveID Corporation, a developer of medical technologies for diabetes management and clinical diagnostics, announced last week that it received clearance from the U.S. Food and Drug Administration (FDA) for its new iglucose mobile health system. iglucose uses mobile technology to communicate glucose readings from a variety of glucometers to the iglucose diabetes management portal, and then the data can be shared with family members, caregivers, and healthcare professionals. PositiveID has signed agreements with AT&T in the U.S. and Rogers Communications in Canada to provide the mobile infrastructure necessary to support the mobile devices. Consumers will not be required to purchase a wireless data plan to use the device.
• On November 8, 2011, the Department of Energy released its “Smart Grid Data Access” Funding Opportunity Announcement (FOA) that will provide up to $8 million to promote partnerships between utilities and third-party technology innovators for the development and implementation of applications that provide access to electricity consumption data. The FOA will have two phases, with funding applications due March 1, 2012. More information is available here.

Please contact Stephanie Joyce, Jeffrey Rummel, G. David Carter, or Stephen Thompson (contact information below) for further information.

Developments in Intercarrier Compensation

• On November 15, 2011, the Colorado Public Utilities Commission (CPUC) entered an order denying motions for reconsideration of an ALJ’s order finding that several competitive local exchange carriers (CLECs) unlawfully discriminated against Qwest Communications Corp. by charging other interexchange carriers lower, off-tariff switched access rates. Qwest filed a complaint with the CPUC on June 20, 2008, alleging that MCIMetro Access Transmission Services, LLC, XO Communications Services, Inc., Time Warner Telecom of Colorado, LLC, Eschelon Telecom, Inc., BullsEye Telecom, Inc., and Level 3 Communications LLC were offering intrastate switched access services at rates lower than their tariffed rates. The ALJ found that the CLECs “ignored statutory and commission requirements regarding access contracts” and “unmistakably violated obligations to charge lawful rates.” In their motions for reconsideration, the CLECs argued that because the off-tariff contracts in question were entered into more than two years before Qwest filed its complaint, the statute of limitations barred Qwest’s complaint. The CPUC rejected these arguments, finding that the CLECs had “an ongoing obligation to cease” their unlawful conduct. Docket No. 08F-259T.
• On November 10, 2011, the South Dakota Public Utilities Commission (SDPUC) closed a tariff dispute proceeding after Aventure Communication Technology LLC voluntarily agreed to withdraw its proposed intrastate switched access services tariff. Qwest Communications Company, Midcontinent Communications, Sprint Communications Company L.P., Verizon Wireless, and AT&T Communications of the Midwest, Inc. had filed protests to the tariff filing, claiming that it would result in unreasonable rates for so-called high-volume access services. On October 25, 2011, a hearing was held before the SDPUC on AT&T’s motion for summary judgment declaring the proposed tariff unlawful as a matter of law. The SDPUC denied AT&T’s motion except as to the billing dispute provisions of Aventure’s proposed tariff, which the SDPUC struck and substituted with the provisions from Aventure’s existing tariff. On October 27, 2011, Aventure filed a voluntary motion to withdraw its proposed tariff, stating that as a result of the FCC’s pending comprehensive order on intercarrier compensation, “Aventure’s FCC tariff may need to be modified which would also mean the proposed intrastate access tariff that is the subject of this docket may require modification.” Aventure indicated it might refile a revised tariff at a later date. Docket No. TC1-010.

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

• Each CLEC that has an intrastate switched access tariff on file with the Illinois Commerce Commission (ICC) is required to reduce its intrastate switched access rates by an amount equal to 50% of the difference between its current intrastate switched access rates and interstate switched access rates. Those CLECs must file updated tariff pages reflecting the reduction by January 1, 2012. This is the second part in a step-down process mandated by a recent Illinois statute, and is intended to result in interstate and intrastate switched access rates mirroring each other by July 1, 2012. A notice from the ICC regarding this process may be found here. 220 ILCS 5/13-900.2.
• The FCC rule requiring CLECs to file their switched access tariffs and any supporting materials electronically went into effect November 17, 2011. A copy of the Report and Order establishing the rule can be found here. FCC-11-92, WC Docket No. 10-141.
  
  CLECs must use the Electronic Tariff Filing System (ETFS) to file their initial base tariffs by January 17, 2012. All subsequent tariff filings must likewise be made via ETFS. A copy of the FCC announcement can be found here. The FCC has issued an updated Public Notice to assist CLECs with their filings, which can be found here.  DA-11-1706, DA-11-1887, WC Docket No. 10-141.
• The Universal Service contribution factor for the Fourth Quarter of 2011 is 15.3%. A copy of the notice can be found here.

Please contact Ross Buntrock, Jon Canis, Michael Hazzard, or Katherine Barker Marshall (contact information below) for further information regarding compliance matters.

Broadband News

• On November 16, 2011, two companies filed suit in the U.S. District Court for the Central District of California against the Internet Corporation for Assigned Names and Numbers (ICANN) and ICM Registry, LLC (ICM) challenging the new system for increasing the number of Top-Level Domains (TLDs) under the antitrust and unfair competition laws. As reported earlier, ICANN has approved a system for domain names that will allow brand owners to register their own generic TLDs, such as “.brand”, as well as the creation of potentially hundreds of new domain names based upon generic terms like “.travel”, “.bank”, and “.nyc”. See June 27, 2011 edition of This Week in Telecom. Plaintiffs are Manwin Licensing International S.a.r.l. and Digital Playground, Inc., which own or control many of the Internet’s largest pornography websites. The companies are challenging the new TLD system because, they allege, it will force them to incur unreasonable and excessive costs in securing websites related to the ICANN-approved “.xxx” domain. ICANN named ICM to be the sole registrar of the “.xxx” domain. Plaintiffs allege that the arrangement is anticompetitive and an unfair business practice. To view the complaint, click here. Manwin Licensing International S.a.r.l. v. ICM Registry, LLC d/b/a .xxx, et al., Case No. 11-cv-9514 (C.D. Cal.).
• On October 25, 2011, Southern Company Services, Inc. (SCS) filed a Petition for Clarification or Reconsideration of the FCC’s Open Internet Order regarding the treatment of “specialized services”. Though SCS acknowledges that the order generally exempts specialized services from its requirements, it “is concerned that some of the statements made in the Open Internet Order could have a chilling effect on the market for specialized services.” Specifically, Southern seeks clarification on the FCC’s statements about “closely monitor[ing]” specialized services and potentially later subjecting them to the Open Internet rules. The Petition urges the FCC to clarify its order “so that utilities and other enterprise customers will be able to develop contractual relationships with confidence that specialized services will not be made subject to the Open Internet rules[.]” Oppositions to the Petition will be due 15 days after it is published in the Federal Register, and replies will be due 10 days later. The Petition is available here. The Public Notice about the Petition is available here.

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

In the Courts

• On November 14, 2011, the U.S. Court of Appeals for the Third Circuit affirmed a Pennsylvania district court’s dismissal of a shareholder fraud suit brought against Verizon Communications and JP Morgan Chase Bank for their respective roles in the Idearc spinoff. Idearc went bankrupt after being unable to satisfy the Verizon debt it assumed as part of the spinoff. The court of appeals agreed that plaintiffs’ securities fraud claims – both statutory and common law – were properly dismissed, because “there is no indication [in the complaint] as to how, when, or why [they] purchased or sold Idearc stock.” As a result, there is “no way to ascertain how any misrepresentation or omission impacted [their] decisions to purchase or sell securities.” The court of appeals also rejected as a “painful stretch” the argument that Verizon violated the Communications Act “because the Idearc spinoff was a scheme that enabled Verizon to unlawfully acquire money which was then used to obtain federal licenses for Verizon’s network.” It concluded that “dressing up yet another version of their inadequate fraud claim in Communications Act clothing does not make it cognizable.” Verizon is still defending claims brought in Texas by the Idearc trustee which survived Verizon’s motion to dismiss in September 2011. Barnard v. Verizon Commc’ns, Inc., No. 11-1318 (3d Cir.).
• On November 10, 2011, the United States District Court for the District of Massachusetts denied Netflix’s motion to dismiss a lawsuit by the National Association of the Deaf and others.  The suit claims that Netflix is violating the Americans with Disabilities Act by failing to provide equal access – through closed captioning – to its video streaming service called “Watch Instantly”. The court denied Netflix’s motion to dismiss under the primary jurisdiction doctrine, and also rejected a request to transfer the case to a federal court in California. The court did agree to stay the case until early February 2012 to give the FCC time to resolve its proceeding on closed captioning of IP-delivered video programming. In the meantime, Netflix must answer the complaint. National Ass’n of the Deaf v. Netflix, Inc. No. 11-cv-30168 (D. Mass.).

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 a hearing on the two nominees to the FCC, Ajit Pai and Jessica Rosenworcel, on November 30, 2011, at 2:30 pm EDT in 253 Russell Senate Office Building. For more information, click here.
• As previously reported, the House Judiciary Committee held a hearing on November 16, 2011, on HR 3261, the Stop Online Piracy Act. Witnesses included Katherine Oyama, Policy Counsel at Google, and Michael O’Leary, Senior Executive Vice President for the Motion Picture Association of America. In his opening remarks, Rep. Lamar Smith, Committee Chair, stated “We cannot continue a system that allows criminals to disregard our laws and import counterfeit and pirated goods across our physical borders. Nor can we fail to take effective and meaningful action when criminals misuse the Internet.” Google drew considerable criticism for its past dealings with “rogue” websites illegally selling prescription drugs to American consumers and for past refusals to block unlawful or infringing content. In her written testimony, Ms. Oyama stated that Google “cannot support the bill as written,” and believes it “sets a precedent in favor of Internet censorship.” Chairman Smith’s full statement and all written testimony can be found here.
• On November 16, 2011, the House Communications Subcommittee approved HR 3309, the Federal Communications Commission Process Reform Act of 2011, and HR 3310, the Federal Communications Commission Consolidated Reporting Act of 2011. Rep. Fred Upton, R-Mich., Chair of the Commerce Committee, said of the bills “I’m glad to support these bills so that America’s small businesses, entrepreneurs, and job creators can actually see what their government is doing.” For further information, including a summary of the bills, click here.

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

Upcoming Events

• The Federal Communications Bar Association will hold its 25th Annual Chairman’s Dinner on December 8, 2011, at the Washington Hilton, 1919 Connecticut Avenue, NW. The cocktail reception begins at 6:00 pm EDT, with dinner at 7:30 am EDT. To register, click here.

Please contact Ross Buntrock, Jonathan Canis, Stephanie Joyce, or Jeffrey Rummel (contact information below) for further information.

For further information, please contact any of our attorneys in the Arent Fox Telecommunications Group, including:

Ross A. Buntrock buntrock.ross@arentfox.com 202.775.5734	Michael B. Hazzard hazzard.michael@arentfox.com 202.857.6029
Jonathan E. Canis canis.jonathan@arentfox.com 202.775.5738	Stephanie A. Joyce joyce.stephanie@arentfox.com 202.857.6081
Alan G. Fishel fishel.alan@arentfox.com 202.857.6450	Jeffrey E. Rummel rummel.jeffrey@arentfox.com 202.715.8479
Adam D. Bowser bowser.adam@arentfox.com 202.857.6126	Jason A. Koslofsky koslofsky.jason@arentfox.com 202.857.8969
Joseph P. Bowser bowser.joseph@arentfox.com 202.857.6102	Katherine Barker Marshall marshall.katherine@arentfox.com 202.857.6104
G. David Carter carter.david@arentfox.com 202.857.8972	Stephen Thompson thompson.stephen@arentfox.com 202.715.8596
Marcia Fuller Durkin durkin.marcia@arentfox.com 212.484.3939