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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FCC Announcements l The Mobile Market l FTC and Privacy Regulation 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 commenced enforcement actions against 20 retailers allegedly selling cell-jamming devices via the Internet. Such devices are unlawful under Section 302(b) of the Communications Act. Because the FCC lacks jurisdiction over retail entities, it must first issue a citation stating that the devices are unlawful. Further violations could result in fines from $16,000 to $112,500. To view the press release about the actions, click here.
• The next FCC Open Meeting is scheduled for October 27, 2011, at 10:30 am Eastern. No agenda has yet been released, but it is expected that the Commission’s order regarding Universal Service and Intercarrier Compensation Reform will be presented for vote.

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

The Mobile Market

• CTIA has asked a federal court in California to block enforcement of a new San Francisco ordinance requiring retailers to display an informational poster and provide fact sheets to consumers about the health risks of cell phone radiofrequency (RF) emissions. The law took effect last week. CTIA alleges that the law violates the First Amendment’s free speech requirements and is preempted by federal law. CTIA also asserts that the information that will be provided to consumers is misleading, because the FCC already limits RF emissions to ensure they are below those levels shown in tests to have adverse health effects. CTIA v. San Francisco, No. 10-cv-3224 (N.D. Cal.).
• Sens. Richard Blumenthal, D-Conn., and Al Franken, D-Minn., have introduced S. 1652, the “Consumer Mobile Fairness Act,” that would prohibit mobile service providers from including binding arbitration clauses in contracts for mobile voice and data services. It is an effort to reverse the Supreme Court’s decision in AT&T Mobility LLC v. Concepcion, in which the Court found that California’s state common law unconscionability doctrine could not be used to invalidate a mandatory arbitration clause in AT&T’s mobile phone contract. Senate bill S.1652 has been referred to the Senate Judiciary Committee. View the bill here.
• Reply Comments on the FCC Further Notice of Proposed Rulemaking regarding the use of microwave links for wireless backhaul are due October 25, 2011. For more information, click here. To view the NPRM, click here.
• Comments on the draft Mobile Medical Applications guidelines from the U.S. Food and Drug Administration (FDA) are due October 19, 2011. The draft guidelines are available here. Filing instructions are provided in the document.

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

Federal Trade Commission (FTC) and Privacy Regulation

• On September 21, 2011, the U.S. Department of Commerce and U.S. Department of Homeland Security published a request for information about the “requirements of, and possible approaches to creating, a voluntary industry code of conduct to address the detection, notification and mitigation of botnets.” Botnets are collections of computers that are remotely controlled by a malevolent third party and “are often used to disseminate spam, to store and transfer illegal content, and to attack the servers of government and private entities with massive, distributed denial of service attacks.” The DOC and DHS are concerned about botnets because a “botnet infection can lead to the monitoring of a consumer’s personal information and communication, and exploitation of that consumer’s computing power and Internet access.” The DOC and DHS seek comment on “detection, notification, prevention, and mitigation of botnets’ illicit use of computer equipment.” More information is available here.
• On October 5, 2011, Mary K. Engle, FTC Associate Director for Advertising Practices, testified before the House Subcommittee on Commerce, Manufacturing and Trade about the agency’s proposed changes to the rules implementing the Children’s Online Privacy Protection Act (COPPA) (see below). The FTC has proposed the rule changes due to evolution in technology since the rules were first promulgated in 2000. More information is available here. Ms. Engle’s written testimony is available here.
• The FTC seeks comment on proposed changes to its Children’s Online Privacy Protection Rule promulgated under the Children’s Online Privacy Protection Act (COPPA). The proposed changes include updating the definition of “personal information” to include geolocation information and other types of persistent identifiers, such as tracking cookies used for behavioral advertising. The FTC also proposes adding new methods for obtaining verifiable parental consent, including electronic scans of signed parental consent forms and video-conferencing, and eliminating “e-mail plus” verification of parent consent which is considered less reliable. The FTC also proposes to strengthen oversight of self-regulatory “safe harbor programs” by implementing reporting and auditing requirements. Comments 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.

Developments in Intercarrier Compensation

• On October 5, 2011, several rural local exchange carriers (LECs), including Chariton Valley Telephone Corporation, Choctaw Telephone Company, Mid-Missouri Telephone Company, and MoKAN Dial, Inc., petitioned the Missouri Public Service Commission to investigate call completion problems experienced by rural carriers in Missouri. The LECs assert that they have received an increasing number of complaints over the last eight to twelve months concerning long-distance calls that fail to complete. They complain of calls that fail to ring for the calling party, of pre-recorded messages stating the call could not be routed, and of low-quality service such as calls in which one party cannot hear the other. The rural LECs accuse least-cost routers of employing questionable techniques to avoid delivering calls to high-cost exchanges, including by establishing improper routing tables and sending calls through low-quality facilities or congested routes. The carriers stated in their petition that a “Missouri PSC investigation would allow the Missouri PSC to determine the extent of the problem in Missouri and examine possible causes of the problems. This information would be useful both to the FCC and to any future state-specific actions that the Missouri PSC may wish to consider.” Docket No. No. TO-2012-0104.

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

• On October 6, 2011, the Federal Register published the new FCC rule requiring Competitive Local Exchange Carriers (CLECs) to file their switched access tariffs and any supporting materials electronically. The rule is effective 120 days after publication, which is February 3, 2012. As of that date, CLECs must use the Electronic Tariff Filing System (ETFS), and file their initial base tariffs within 60 days. A copy of the Federal Register notice can be found here. A copy of the Report and Order establishing the rule can be found here. FCC-11-92, WC Docket No. 10-141.

• On October 4, 2011, the Florida Public Service Commission (FLPSC) announced that it was reducing its minimum annual regulatory assessment fees (RAFs) by 20% on telecommunications carriers operating in Florida. The FLPSC attributes the decrease to its declining workload as a result of Florida’s new telecommunications legislation, effective July 1, 2011 (HB 1231), that narrowed the FLPSC’s jurisdiction. A press release providing further detail on the RAF reductions can be found here. A copy of HB 1231 can be found here.
• 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

• The Open Internet rules, published on September 23, 2011, now face several legal challenges. As reported last week, Free Press appealed the rules in order to remove the distinction between wireline and wireless broadband networks. Several other organizations have followed suit, including Media Mobilizing Project, Access Humboldt, and Mountain Area Information Network, all of which are being represented by the Media Access Project. On September 30, Verizon appealed the rules in two separate cases, seeking full reversal. On October 5, Public Knowledge moved to intervene in the Verizon appeals on behalf of the FCC. The FCC filed a motion to dismiss one of Verizon’s appeals on October 6. Also on October 6, the Judicial Panel on Multidistrict Litigation announced that the D.C. Circuit was assigned the consolidated appeals via lottery.
• On October 6, 2011, Chairman Genachowski gave a speech previewing the reforms being considering in the Connect America Fund (“CAF”) order that is scheduled for vote at the October 27 Open Meeting. Highlighting the importance of broadband to rural America, the Chairman promised that the reforms will bring broadband to millions of consumers by modernizing USF and the intercarrier compensation system. The reforms were described generally by the Chairman as a transition from USF to the CAF, which will be capped. As to intercarrier compensation, the Chairman promised to eliminate “loopholes” and “arbitrage,” as well as to ensure “symmetry” for the compensation of VoIP traffic. Access rates will be phased down over time, starting with terminating access charges. The Chairman also promised to facilitate efficient interconnection in an IP world. The written text of the speech may be found here.

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

In the Courts

• On October 3, 2011, the U.S. District Court for the Western District of Kentucky granted summary judgment to a class of plaintiffs who sued Windstream Kentucky East LLC for violating the Communications Act by charging customers a “gross receipts surcharge” at a rate higher than the tariffed surcharge. The Court held that it was unlawful for Windstream to exceed its tariff, and noted that Windstream’s stated need to pass through tax increases via this surcharge “does not excuse compliance with Section 203 [of the Communications Act] and the Filed Tariff Doctrine.” The court will now move to the damages phase, where Windstream must produce evidence of the payments it improperly collected. Bowers v. Windstream Ky. East LLC, No. 3:09-cv-440 (W.D. Ky.).
• On October 3, 2011, the United States Supreme Court refused to grant a writ of certiorari to review a ruling that the Communications Act and the FCC’s regulations preempt civil claims alleging injury from cellphone RF emissions. Both the Eastern District of Pennsylvania and the U.S. Court of Appeals for the Third Circuit held that such state law claims are preempted by federal RF rules for mobile devices. Farina v. Nokia, Inc., No. 10-1064.

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

Legislative Outlook

• The House Subcommittee on Commerce, Manufacturing, and Trade will hold a hearing titled “Understanding Consumer Attitudes About Privacy” on October 13, 2011, at 9:00 am Eastern in 2123 Rayburn House Office Building. To learn more, click here.
• The House Subcommittee on Energy and Power will hold a hearing titled “The American Energy Initiative: Electric Transmission Issues, Including Topics Related to the Siting, Planning, and Allocation of Costs for Electricity Transmission Infrastructure” on October 13, 2011, at 9:30 am Eastern in 2322 Rayburn House Office Building. To learn more, click here.
• The House of Representatives has approved HR 1343, described as a bill “To return unused or reclaimed funds made available for broadband awards in the American Recovery and Reinvestment Act of 2009 to the Treasury of the United States.” House Commerce Committee Chair Fred Upton, R-Mich., said of the bill “The recent Solyndra scandal highlights the need to provide oversight and accountability for the stimulus program.” The text of the bill is available here. To view a press release about HR 1343, click here.
• Senator John “Jay” Rockefeller IV, D-W.Va., Chair of the Senate Commerce Committee, issued a statement praising the DOC and DHS on their investigation of botnets. See FTC/Privacy above. He stated that “Internet providers in other countries are already providing alerts and warnings to compromised consumers as well as offering free mitigation tools. … In order to make cyberspace safe in the 21st century, it is critical that other U.S. companies follow suit.” To view the full statement, click here.
• Sen. Rockefeller also has sent a letter to the FCC urging it to speed up implementation of the Commercial Advertisement Loudness Mitigation Act that was signed in 2010. He stated that “Despite what some parties are now suggesting, we did not intend to fix this problem for only a small fraction of commercials, leaving the majority of advertisements free to blare and irritate television viewers.” To view the full letter, click here.

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

Upcoming Events

• The Mobile Internet Content Coalition (MICC), founded with the assistance of Michael Hazzard and other attorneys in our Group, will hold its first conference, the Mobilizing Mobile Summit, on November 15, 2011, at Georgetown University. MICC advocates free and fair development of mobile technologies, applications, and services. For more information about the event or to register, click here.
• Jeffrey Rummel, a Partner in our Group, will deliver a presentation titled “FCC Licensing/Regulation of the Manufacture, Development & Testing of Military Communications Systems” at the Military Wireless Conference to be held November 15-17, 2011, in Las Vegas. For more information or 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	Marcia Fuller Durkin durkin.marcia@arentfox.com 212.484.3939
Joseph P. Bowser bowser.joseph@arentfox.com 202.857.6102	Jason A. Koslofsky koslofsky.jason@arentfox.com 202.857.8969
G. David Carter carter.david@arentfox.com 202.857.8972	Katherine Barker Marshall marshall.katherine@arentfox.com 202.857.6104