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ON DECK: Pending and Upcoming Appellate Litigation Involving the FCC

by: Richard Welch

October 27, 2010

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During spring training, on the cusp of the major league baseball season, the Office of General Counsel discussed several significant cases involving the FCC that were pending before the appellate courts. See "On Deck" blog entry dated February 19, 2010. Now that the baseball season draws to a close, we thought this might be a good time to provide an update on these cases and other upcoming appellate litigation involving the agency.

The FCC in the Supreme Court

The Freedom of Information Act
In FCC v. AT&T, Inc, No. 09-1279, the Supreme Court of the United States will decide whether the FCC properly applied the Freedom of Information Act in a case involving the agency's investigation into AT&T's alleged over-billing of the United States Government for services it provided under an FCC program for schools and libraries. The Freedom of Information Act (commonly known as the "FOIA") is the federal law that permits the public to request and obtain copies of records from the Government. After a trade association filed a FOIA request asking the FCC to release certain documents the agency obtained during its investigation, AT&T sued the FCC to block release of the documents, relying on FOIA Exemption 7(C). That provision exempts from mandatory public disclosure records or information compiled for law enforcement purposes, when disclosure could reasonably be expected to constitute an unwarranted invasion of "personal privacy." The question facing the Supreme Court is whether Exemption 7(C)'s protection for "personal privacy" protects corporations in addition to individuals. In September 2009, the Third Circuit Court of Appeals in Philadelphia held that corporations can have protected "personal privacy" interests under Exemption 7(C). The Supreme Court recently granted the request of the FCC and the United States Department of Justice to review that decision. Briefs are due by the end of this year, oral argument likely will be heard early in 2011, and the Supreme Court is expected to issue its decision by June 2011.

Intercarrier Compensation for Dial-up Internet Access Traffic
In January of this year, the D.C. Circuit Court of Appeals upheld the FCC's authority to regulate the rates charged between carriers that collaborate to carry dial-up Internet access traffic. The Pennsylvania Public Utilities Commission and a local carrier whose customers are Internet Service Providers (Core Communications, Inc.) have asked the Supreme Court to review the D.C. Circuit's decision. The FCC and the Justice Department recently filed a brief opposing their petitions. By mid-November, we expect the Supreme Court to announce whether it will hear the case.

The FCC in the Courts of Appeals

Broadcast Indecency Enforcement
In our February 2010 blog entry, we discussed several pending cases involving the FCC's enforcement of the statutory and regulatory prohibition against indecent programming on broadcast television. All remain pending. The most prominent case is Fox Television Stations, Inc. v. FCC, which presents a constitutional challenge to the FCC's decisions finding violations of the broadcast indecency statute and regulations for Fox's broadcast of expletives by celebrities Cher and Nicole Richie on live television awards shows. In July of this year, a three-judge panel of the Second Circuit Court of Appeals in New York ruled that the FCC's indecency policy is unconstitutionally vague and therefore violates the First Amendment rights of broadcasters. The FCC has asked all active judges on that appeals court to review the panel's decision. That request remains pending before the court.

We also await a decision by the Third Circuit in CBS Corp. v. FCC, another broadcast indecency case, which was argued in February 2010. At issue is CBS's broadcast of the 2004 Super Bowl halftime show in which Janet Jackson, performing with Justin Timberlake, suffered what some have described as a "wardrobe malfunction." CBS is challenging the $550,000 forfeiture that the FCC assessed against certain CBS-owned affiliates for broadcasting Jackson's fleeting nudity. Both the FCC's brief and its supplemental brief are available; its supplemental letter is available; and its second supplemental brief is available.

Finally, we await a decision by the Second Circuit in the case of ABC, Inc. v. FCC, which was argued in February 2009. That case presents a challenge to the FCC's finding of an indecency violation for broadcast of nudity during an episode of the television show NYPD Blue. Here you can find the FCC's brief in this case and its supplemental brief.

LEC-CMRS Interconnection
The D.C. Circuit recently heard oral argument in MetroPCS Calif., Inc. v. FCC, No. 10-1003. This case involves a dispute in which a competitive local exchange carrier that handles only incoming calls bound for chat lines (North County Communications) has sought compensation for completing such calls that originated on the network of a cellular carrier (MetroPCS California). Because all the traffic at issue was "intrastate" – that is, the calls originated and terminated within California and did not cross state borders – the FCC ruled that the California Public Utilities Commission should set the rate North County may charge MetroPCS for completing the calls to the chat lines. MetroPCS contends that the FCC, not the state regulatory commission, should establish the rate. We expect the court's decision in the next few months, perhaps before the end of the year. The FCC's brief in this case is available.

Upcoming Cases
Over the next three months, the FCC will file briefs or present oral argument in support of its decisions in a number of cases, including the following:

  • A First Amendment challenge to a provision of the Communications Act that bars a non-commercial educational television station from broadcasting promotional advertisements. (Minority Television Project, Inc. v. FCC, No. 09-173111 (9th Cir., argument scheduled for Nov. 1, 2010) (to be argued by the Justice Department)). The brief for the United States and the FCC is available.
  • A challenge to an FCC order establishing interim rates for providers of Video Relay Service. (Sorenson Communications, Inc. v. FCC, No. 10-9536 (10th Cir., FCC's brief due Nov. 8, 2010)).
  • A challenge to an FCC order permanently transferring three toll-free suicide hotline numbers from a private nonprofit entity to a component of the U.S. Department of Health and Human Services. (Kristin Brooks Hope Center v. FCC, No. 09-1310 (D.C. Cir., argument scheduled for Nov. 9, 2010)).  The FCC's brief in this case is available.
  • A challenge to an FCC order concluding that an exclusive distribution agreement between a cable operator and a terrestrially-delivered cable-owned network may constitute an unfair method of competition in violation of the Communications Act. (Cablevision Sys. Corp. v. FCC, No. 10-1062 (D.C. Cir., FCC's brief due Nov. 18, 2010)).
  • A challenge to an FCC order denying Alpine PCS, Inc.'s request for a waiver of the FCC's automatic license cancellation rule, when Alpine defaulted on its installment payments for wireless licenses it won at auction. (Alpine PCS, Inc. v. FCC, No. 10-1020 (D.C. Cir., argument scheduled for Dec. 3, 2010)). The FCC's brief in this case is available.
  • A challenge to FCC orders denying a complaint filed by Staton Holdings, Inc. against MCI concerning the reassignment of a toll-free number from Staton to a third party. (Staton Holdings, Inc. v. FCC, No. 10-116 (D.C. Cir., FCC's brief due Dec. 10, 2010)).
  • A challenge to an FCC order consenting to the involuntary transfer of nine radio station licenses to a state court-appointed receiver. (Cherry v. FCC, No. 10-1151 (D.C. Cir., FCC's brief due Dec. 20, 2010)).
  • A challenge to an FCC order interpreting a provision of the Communications Act that requires state and local governments to act "within a reasonable time" on siting applications for facilities used to provide wireless communications services. (City of Arlington, Texas v. FCC, No. 10-60039 (5th Cir., FCC's brief due Dec. 23, 2010)).
  • A challenge to an FCC order denying Qwest Corporation's petition that the FCC forbear from enforcing certain network element unbundling requirements and certain dominant carrier regulatory obligations against Qwest in the Phoenix area. (Qwest Corp. v. FCC, No. 10-9543 (10th Cir, FCC's brief due Jan. 10, 2011)).
  • A challenge to an FCC order concerning the grant of certain applications to operate Automated Maritime Telecommunications Service stations in various locations of the United States. (Havens v. FCC, No. 02-1359 (D.C. Cir., FCC's brief due Jan. 20, 2011)).

As the above discussion shows, unlike baseball, litigation challenging the FCC's decisions never ends. So stay tuned for the next edition of "On Deck" – perhaps when pitchers and catchers report to spring training early in 2011 and help chase away those winter blues. Who knows, maybe the Washington Nationals will finally have a winning season next year. In baseball, as in appellate litigation, "Hope springs eternal…."

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