Appeals Court Could Slam FCC for Inadequate Response on ISP Remand
Concerns are growing that the FCC faces additional sanctions from the U.S. Court of Appeals for the District of Columbia Circuit unless it provides an additional response to that court on the ISP remand beyond its interim order released last month, FCC and industry officials said this week. The FCC on Nov. 5 issued an order responding to the court’s long-standing remand by providing additional justification for the original 2001 ISP-bound traffic rule, without changing compensation rules overall.
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Chairman Kevin Martin said in a statement at the time he considered the remand response inadequate and if the appeals court wanted a more satisfactory response it should “enforce our promise of reform on pain of automatic vacatur” if the FCC didn’t act by Dec. 18, as promised by other commissioners. Other commissioners contend that Martin has taken steps which have made a response by that date impossible - particularly a decision to delay the deadline for comments on various intercarrier compensation notices until Dec. 22. Given that and the current focus on DTV transition issues, FCC officials say intercarrier compensation overhaul likely will have to wait until next spring at the earliest. That delay could open the door to additional sanctions by the federal appeals court.
“They could just vacate the order,” said one FCC official. “I don’t what the next remedy is. … The court is absolutely fed up with the FCC. How far would they go in sanctioning the commission?” The official said in contrast “universal service would be nice to do something on, but we don’t have to” and there is less impetus for the FCC to act on USF because a Democrat-controlled commission could reconsider next year and overturn anything it didn’t like.
An industry attorney active on intercarrier comp and USF, said the court would only act on a challenge of the Nov. 5 order. ISP Core Communications challenged the ISP remand response last month. But even then, the same panel of judges that handed down the ISP remand wouldn’t necessarily take up this challenge. “Are [judges] going to defer again if the FCC general counsel says we're still working on this give us another chance? Probably not,” the official said. “But they did something. They didn’t do nothing.”
A second industry official said the D.C. appeals court could hand down any number of sanctions. But that will happen under a new chairman at the FCC, the official predicted. “The court could come back and say … you were supposed to give us a total answer and you gave us a half answer. We're not happy with you,” the official said, “They could vacate, vacate part of it. … But I don’t think that gets heard by Jan. 20 or even April.”
How the court may respond depends on how it interpreted D.C. Circuit Judge Merrick Garland’s mandamus ruling, said Michael Hazzard, attorney for Core, in an interview. If the court was asking for any legal basis for the rules, it may find that the FCC satisfied the mandamus, he said. But Core believes the court asked the FCC to explain why its intercarrier compensation rules exclude ISP-bound traffic from the reciprocal compensation requirement of Section 251(b)(5), he said. The FCC failed to do so, and in fact explained the opposite, he said. The FCC said that ISP-bound traffic is telecommunications and falls within the reciprocal compensation rules, but the agency may set the rates via its section 201 general rulemaking authority, he said.
A Core challenge to the FCC order remains pending. Core filed a petition for review in the D.C. Circuit on Nov. 21, and earlier this month filed motions to speed consideration and retain the same panel of judges who ordered the mandamus. The FCC’s response is due later this week, Hazzard said.