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.

Federal Communications Commission (FCC) Announcements

  • SCHEDULE CHANGE: The FCC has changed the date of its next Open Meeting to June 27, 2013. We will link the Tentative Agenda when it is released.

The Mobile Market

  • FirstNet, the organization charged with building a nationwide public safety broadband network, will hold six regional workshops that it will hold with states, tribes, territories, and localities to discuss the nationwide network. The first workshop will be held May 15-16 in the Washington, DC area. The other workshops will be in Denver (May 21-22), San Francisco (May 29-30), St. Louis, (June 12-13), Boston, (June 19-20), and Memphis (June 26-27).
  • At its May 9 Open Meeting, FCC approved a joint Notice of Proposed Rulemaking (NPRM) and Notice of Inquiry (NOI) aimed at facilitating the use of spectrum by the budding commercial space launch industry for communications services that control, monitor, and track launch vehicles. According to a Commission press release, the “proposal represents an important first step towards enabling commercial space launch operators to directly acquire licenses needed for use during launches” and also inquires about “future spectrum requirements of the commercial space industry.” Comments will be due 60 days after Federal Register publication with Reply Comments due 90 days publication. The NPRM/NOI is available here. Docket ET No. 13-115.
  • On May 1, 2013, the FCC released a Notice of Proposed Rulemaking on measures it may adopt to prevent the use of cellphones by incarcerated persons. In the NPRM, the FCC states that “[p]risoners’ use of contraband wireless devices to engage in criminal activity is a serious threat to the safety of prison employees, other prisoners, and the general public.” The proposed rules would make it easier for correctional facilities to enter into leases or spectrum management agreements, allowing them to control which wireless devices were able to access the network. In addition, the proposed rules would “require wireless providers to terminate service, if technically feasible, to a contraband wireless device if an authorized correctional facility official notifies the wireless provider of the presence of the contraband wireless device”. The Commission also invites comment on “other technological approaches for addressing the problem of contraband wireless device usage in correctional facilities.” Comments on the NPRM are due 30 days after Federal Register publication, and Reply Comments are due 45 days after publication. The NPRM is available here. GN Docket No. 13-111; ET Docket No. 08-73; WT Docket No. 10-4.

Federal Trade Commission (FTC) and Privacy Regulation

  • In conjunction with an international privacy practice transparency sweep conducted by the Global Privacy Enforcement Network (GPEN), the FTC has issued letters to ten data broker companies warning that their consumer data collection and use practices may violate the Fair Credit Reporting Act (FCRA). The letters do not constitute an official FTC finding of FCRA violations, but rather serve to remind these data brokers and other similarly situated entities of their obligations when collecting and using consumer data. More information regarding the FTC’s privacy sweep is here.
  • The FTC has announced that it will host a one-day public forum on June 4, 2013, addressing malware, viruses and similar threats facing users of smartphones, tablets and other mobile technologies. According to the press release, the one-day forum “will focus on the security of existing and developing mobile technologies and the roles various members of the mobile ecosystem can play in protecting consumers from these types of security threats.” More information regarding the one-day forum is available here.
  • The FTC has announced a public workshop to be held on November 21, 2013, in Washington, DC to address the consumer privacy and security issues raised by the growing connectivity of consumer devices such as smart phones, cars, appliances, and medical devices, also commonly referred to as “The Internet of Things”. In advance of the workshop, the FTC is inviting comments on these issues and will accept submissions through June 1, 2013. More information regarding the “Internet of Things” workshop and comments is available here.

New Markets: Smart Grid and E-Health

  • Reply Comments on the USTelecom petition for reconsideration of the FCC’s Healthcare Connect Fund (HCF) Order are due May 20, 2013. The petition asks the FCC to reconsider its decisions to permit health care providers participating in the HCF to install and resell excess capacity, and to receive support for dark fiber. USTelecom also asks the Commission to clarify several parts of the order. To read the Public Notice, click here. WC Docket No. 02-60.

Developments in Intercarrier Compensation

  • On May 8, 2013, the Iowa Department of Justice, Office of Consumer Advocate (OCA) filed a motion requesting that the Iowa Utilities Board (IUB) adopt a Staff recommendation to open a formal investigation on rural call completion complaints within Iowa. This effort arises from of complaints filed by two Iowa sisters complaining that they frequently had problems calling their mother located in a rural part of the state. Staff requested information from CenturyLink, which responded that it would least-cost route the sisters’ calls through InterMetro Communications, Inc. When Staff requested information from InterMetro as to why calls would frequently not complete, it stated that it too would route this traffic through another provider, but it would not disclose which carrier, citing confidentiality provisions in the parties’ master services agreement. On April 29, 2013, Staff issued a proposed resolution recommending that the IUB open a formal proceeding that permit the IUB to conduct a full investigation, while also permitting carriers to submit confidential data. In its motion joining Staff’s recommendation to conduct a formal investigation, OCA stated that problems with rural call completion in Iowa “are occurring with more than sufficient frequency, and to more than a sufficient number of rural telecommunications consumers, to justify investigation.” Docket No. FCU-2013-0006.

Compliance Notes

  • The Universal Service contribution factor for the second quarter of 2013 is 15.5%. A copy of the Public Notice announcing the rate can be found here. (DA 13-422)

Broadband News

  • The Federal Register has published the FCC’s Notice of Proposed Rulemaking in PS Docket No. 12-94 regarding the use of broadband in the public safety network. Initial Comments are due May 24, 2013, and Reply Comments are due June 10, 2013. To read the Public Notice announcing these dates, click here. To read the NPRM, click here.

In the Courts

  • On May 8, 2013, Judge Scola of the U.S. District Court for the Southern District of Florida issued a noteworthy decision concerning which entities can be liable under the Telephone Consumer Protection Act (TCPA) for debt-collection calls relating to unpaid medical bills. The plaintiff’s wife signed various hospital forms — including HIPPA forms — when the plaintiff went to the emergency room in Broward County, Florida. Florida United Radiology provided services for which it billed the plaintiff $49.03. When he did not pay the bill, Florida United, through its parent company, forwarded the debt to a debt collector, Gulf Coast Collection Bureau. Gulf Coast used a predictive dialer to make 15 debt-collection calls to Plaintiff’s mobile phone. All three defendants moved for summary judgment on the ground that plaintiff gave his prior express consent — an affirmative defense to TCPA claims — to receive the calls at issue when he provided his phone number in the Hospital forms completed when he sought treatment. Their argument was based on the FCC’s 2008 decision that “the provision of a cell phone number to a creditor, e.g., as part of a credit application, reasonably evidences prior express consent…” Rejecting defendant’s argument that the court must defer to that FCC decision under the Hobbs Act, the court and found the FCC’s order inconsistent with the statutory language, because it conflates “express consent” with “implied consent”. “The FCC’s construction is inconsistent with the statute’s plain language because it impermissibly amends the TCPA to provide an exception for ‘prior express or implied consent.’ Congress could have written the statute that way, but it didn’t.” The court also rejected that complying with HIPPA shields these defendants from TCPA liability. The court reasoned that there “could be many reasons that a person would give his phone number to a healthcare provider and most of them likely relate to treatment, care, and insurance. To receive automated debt collection calls is not necessarily or obviously one of the reasons a person would do so.” The court also held that Florida United, the provider, never received express or implied consent — only the hospital did. The court granted summary judgment in favor of the plaintiff and against the debt-collection company that made the 15 calls. The damages is the statutory minimum of $500 per call; a jury will decide if Gulf Coast willfully violated the TCPA for any of the calls which would increase damages to $1500 per call. Florida United and its parent won summary judgment in their favor on the ground that they did not control the debt collector’s activities and thus cannot be vicariously liable for calls. The case has not yet been certified as a class action. Mais v. Gulf Coast Collection Bureau, Inc., No. 11-61936-Civ-Scola (S.D. Fla. May 8, 2013).

Legislative Outlook

  • Four Senators, Sen. John D. (“Jay”) Rockefeller IV, D-W.Va., Sen. Carl Levin, D-Mich., Sen. John McCain, R-Ariz., and Sen. Tom Coburn, R-Okla., have introduced S. 884, the “Deter Cyber Theft Act”, to address “cyber espionage” and commercial theft. In a joint press release, Sen. McCain stated that, “Some foreign governments, businesses and state-owned enterprises are today using cyber espionage to steal American intellectual property and rob U.S. ingenuity and innovation in order to gain competitive advantage.” That press release is available here. S. 884 is here.
  • The House Subcommittee on Courts, Intellectual Property, and the Internet will hold a hearing titled “A Case Study for Consensus Building: The Copyright Principles Project ” on May 16, 2013, at 2:00 pm Eastern in 2141 Rayburn. For more information, click here.