TCPA Watch

Business, legal and policy developments under the Telephone Consumer Protection Act.

 

1
FCC’s New Pole Attachment Rules Become Effective
2
No Group Hugs: The Supreme Court Says “Yes” to Class Action Arbitration Waivers
3
Restrictive Website Rules Found to Be Anticompetitive
4
FCC Launches Proceeding to Review AT&T Acquisition of T-Mobile and Answers Questions
5
Senators McCain and Kerry Introduce Privacy Bill of Rights
6
U.S. Justice Department Raises Concerns Regarding Proposal to Limit Federal Government’s Access to ‘Cloud’ Data
7
Retransmission Consent Examined in Heated, Live Webcast Debate Among Broadcast, Cable, Programming, and Consumer Interests
8
House Votes to Overturn FCC’s Net Neutrality Order
9
FTC Continues to Flex Its Enforcement Muscle With Regard to Social Media Promotional Activity
10
Broadcaster, Cable, Programming, and Consumer interests to debate retransmission consent in live webcast, Thursday, April 7 at 1pm EDT

FCC’s New Pole Attachment Rules Become Effective

The FCC’s amended pole attachment rules, which are intended to expedite the rollout of advanced telecom, video and broadband services, promote competition and reduce the costs of network buildout, have been published in the Federal Register and have become effective.  The FCC’s pole attachment rules, adopted under Section 224 of the Communications Act, govern the rates and conditions imposed by local exchange carriers, electric and other utilities on cable television and telecom carriers for access to their poles, conduits, and rights-of-way to ensure access is provided in a nondiscriminatory manner and at reasonable rates. The FCC’s new rules include:

(1) a four-stage timeline governing utility grants of pole attachment access to speed the processing and provide greater administrative clarity to applicants. The new rules would limit utilities’ right to halt attachments for emergencies under a “good and sufficient” cause standard; 

(2) modified procedures to expedite attachment-related complaints. In order to encourage meaningful negotiations between utilities and those seeking attachment, the FCC will now require the parties to engage in “executive-level” discussions before filing a complaint with the Commission. The rule institutes additional system reforms designed to expedite the pole access and complaint processes; 

(3) changes to the telecommunications rate formula and procedures applied to pole attachments; and

(4) permitting local exchange carriers to file complaints with the Commission regarding pole attachment rates and conditions while confirming that wireless providers remain entitled to the same attachment rates and conditions as landline telecom providers.

No Group Hugs: The Supreme Court Says “Yes” to Class Action Arbitration Waivers

By Andrew Glass and Robert Sparkes III

The Supreme Court’s ruling in AT&T Mobility LLC v. Concepcion continues the Court’s string of arbitration decisions bringing greater clarity to what has been a cloudy subject.  In this decision, the Court addresses the question of whether businesses can enforce class action waivers in their consumer arbitration agreements, answering unequivocally “yes.” Indeed, the decision is an important victory for businesses, and is likely to help businesses avoid the costs of what are more often than not meritless class lawsuits.

The Concepcion decision finds its roots in the Court’s recent decision in Stolt-Nielsen S.A. v. AnimalFeeds International Corporation. There, the Court established the principle that parties cannot be forced to submit to class-wide arbitration unless they have actually agreed to do so. In Stolt-Nielsen the Court did not have the occasion to address whether parties can expressly waive arbitration on a class-wide basis. Now, applying Stolt-Nielsen to express class action arbitration waivers, Concepcion finds the Federal Arbitration Act (FAA) invalidates state law aimed at barring such waivers. State law is preempted by the FAA where it presents “an obstacle” to accomplishing Congress’s objective of promoting the efficiency of arbitration.

The telecommunications, consumer credit and finance, and sales industries, as well as other businesses that offer consumer services, are likely to benefit from the lower costs of individual arbitration. AT&T contends that consumers will also benefit from the streamlined procedures offered by arbitration.

Restrictive Website Rules Found to Be Anticompetitive

By Scott M. Mendel and Michelle S. Taylon

In Realcomp II, Ltd. v. FTC (6th Cir. April 6, 2011), the Sixth Circuit upheld the Federal Trade Commission’s conclusion that Realcomp, a Detroit area multiple listing service, violated Section 5 of the Federal Trade Commission Act by adopting rules restricting the ability of its broker members to advertise discounted brokerage services. While none of Realcomp’s website restrictions eliminated discount brokerage services or information regarding such services, they made such information less accessible and more costly to obtain. That was enough for the court to conclude that Realcomp’s policies had an actual anticompetitive effect based on the decline in the share of listings accounted for by discount listings.

The Realcomp decision can have significant implications for businesses, especially joint ventures, considering rules that restrict the information that can be disseminated over their websites. Rules that prevent, restrict, or make more costly the dissemination of information relating to discounted services must be reviewed carefully to determine their potential for anticompetitive effects.

FCC Launches Proceeding to Review AT&T Acquisition of T-Mobile and Answers Questions

Today the FCC announced the opening of a docket and the issuance of a protective order related to AT&T’s proposed acquisition of T-Mobile USA. Presentations by interested parties before the FCC will be exempt from the agency’s ex parte procedures until the applications seeking FCC approval are filed. When filed, ex parte communications before the FCC must follow the "permit but disclose" ex parte procedures applicable to non-restricted proceedings, although it reserved the right to treat the proceeding as restricted.

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Senators McCain and Kerry Introduce Privacy Bill of Rights

On April 12, 2011, Senator John Kerry (D-MA) and Senator John McCain (R-AZ) introduced the “Commercial Privacy Bill of Rights Act of 2011” to establish the first federal statutory baseline of consumer privacy protection that would apply across industry sectors. The bill would govern how customer information is used, stored, and distributed online. We will provide more analysis soon, but for now, here are the highlights:

Information covered. The bill applies to broad categories of information, including names, addresses, phone numbers, e-mail addresses, other unique identifiers, and biometric data when any of those categories are combined with a date of birth, place of birth, birth certificate number, location data, unique identifier information (that does not, alone, identify an individual), information about an individual’s use of voice services, or any other information that could be used to identify the individual.

Right to security and accountability. Information-collecting entities would be required to implement security measures to protect user information and would be prohibited from collecting more individual information than is necessary “to enforce a transaction or deliver a service requested by that individual,” subject to certain exceptions.

Privacy by design. Entities would be required to implement privacy by design concepts, which would require entities to incorporate privacy protection into each stage of product or service development in a manner that is much more comprehensive than previously required anywhere in the United States.

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U.S. Justice Department Raises Concerns Regarding Proposal to Limit Federal Government’s Access to ‘Cloud’ Data

By Oded Green

On April 6, 2011, the Senate Judiciary Committee held a hearing regarding a proposed update to the Electronic Communications Privacy Act (ECPA) in light of cloud computing and other technological developments that have occurred since the statute was enacted more than two decades ago. The ECPA is comprised of three laws — the Wiretap Act, the Stored Communications Act, and the Pen Register Act — which govern when certain parties, including law enforcement and other governmental authorities, may access communications and related data and to whom they may disclose those communications and data.

According to Senate Judiciary Committee Chairman, Patrick Leahy, with the explosion of cloud computing, social networking sites and other new technologies, determining how to bring ECPA into the digital age is one of Congress’ greatest challenges. He added that ECPA is “hampered by conflicting standards that cause confusion for law enforcement, businesses and consumers.” For example, the content of a single e-mail could be subject to as many as four different levels of privacy protections under ECPA, depending on where it is stored, and when it is sent.

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Retransmission Consent Examined in Heated, Live Webcast Debate Among Broadcast, Cable, Programming, and Consumer Interests

A live webcast last week carried on Internet TV channel Broadband US TV examined all sides of the debate on whether rules governing the grant of retransmission consent by local broadcast stations to cable operators, DBS providers, and other multichannel video programming distributors (MVPDs), should be reformed.

Retransmission consent negotiations have become quite contentious in recent years, at times resulting in the temporary blackout of a local broadcast station in the face of an impasse between the MVPD and broadcaster.

The lively and, at times, raucous debate featured Toni Cook Bush of Skadden, Arps and John Hane of Pillsbury Winthrop Shaw Pittman for broadcasters, Ross Lieberman of the American Cable Association and Cristina Pauze of Time Warner Cable for cable operators, Gigi Sohn of Public Knowledge for consumer interests, and Richard Waysdorf, of Starz Entertainment for independent programmers. The program was moderated by Broadband US TV co-hosts Marty Stern of K&L Gates and Jim Baller of the Baller Herbst Law Group.

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House Votes to Overturn FCC’s Net Neutrality Order

In a setback to one of the FCC’s key policy proposals, the House of Representative today voted in favor of a Resolution of Disapproval under the Congressional Review Act aimed at invalidating the Commission’s Net Neutrality Order adopted late last year. The vote follows months of heated industry and Congressional debate, including sharply partisan debate  about the Resolution’s merits, court challenges brought by wireless carriers, and procedural delays in bringing the Resolution to the House floor. While the Resolution seeks to overturn the FCC’s new anti-blocking, network management transparency, and traffic discrimination rules, it faces an uphill battle to become law. The Resolution would need to get passed by the Democrat-controlled Senate and get signed by the President. The White House recently said it plans to veto any measure overturning the FCC’s Net Neutrality Order.

FTC Continues to Flex Its Enforcement Muscle With Regard to Social Media Promotional Activity

by Ann M. Begley, Lawrence C. Lanpher and Carolina M. Heavner

The Federal Trade Commission’s (“FTC”) recent action against a company and its owner in connection with the allegedly deceptive promotion of music teaching tools signals FTC’s continued intention to keep social media promotional activity as an enforcement priority. In its third public investigation and second enforcement action since issuing its revised Guides Concerning the Use of Endorsements and Testimonials in Advertising[1] (hereafter, FTC Endorsement/Testimonial Guides) in December 2009, FTC continues to expand advertisers’ responsibility to monitor third party interactive media communications containing endorsements of advertisers’ products.

In finding the advertiser and its owner, an individual, responsible for assuring that endorsers adequately disclose any material connections with the advertiser, FTC states that an advertiser agreement that requires endorsers to comply with FTC guidelines and disclosures is insufficient in the absence of an advertiser monitoring program that ensures clear and prominent disclosure of the relationship with the advertiser.[2]

Thus, in addition to a $250,000 penalty against the company and its owner, FTC has required a far-reaching monitoring program – a potentially expensive and burdensome commitment for the future.

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Broadcaster, Cable, Programming, and Consumer interests to debate retransmission consent in live webcast, Thursday, April 7 at 1pm EDT

Broadband US TV will feature a live webcast debate on retransmission consent this Thursday, April 7 at 1pm EDT.

Register for free by clicking here.

Every season, viewers and sports fans seem to get caught in the middle of disputes between broadcasters and cable and DBS providers over the terms of carriage of broadcast stations and affiliated programming. This program will examine the real issues underlying retransmission consent disputes and the economics and politics driving these issues.

This is an especially important question now, because thousands of carriage agreements will be up for renewal this year, as the FCC continues to examine these issues in an ongoing rulemaking proceeding.
 

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