Briefs on Prison Calling Challenge Offer Different Views of FCC Order
Securus urged the 1st U.S. Circuit Court of Appeals to transfer to the 5th Circuit the company’s challenge of the FCC’s July order implementing the Martha Wright-Reed Act of 2022, which reduces call rates for people in prisons while establishing interim rate caps for video calls (see 2407180039). Securus and various states disagreed sharply with public interest groups about whether the rates set were too low or potentially too high.
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In its petition for review at the 5th Circuit, Securus said the FCC's denial of its clarification and waiver petitions on alternative payment plans was "arbitrary, capricious, and an abuse of discretion within the meaning of the Administrative Procedure Act." At the time, current FCC Chairman Brendan Carr concurred with parts of the incarcerated persons communications services (IPCS) item, though he raised questions about the rate structure that commissioners approved.
“The lottery selecting this Court should not have occurred,” Securus said in a brief this week (24-8028). “Instead, the FCC should have filed the record on appeal in the Fifth Circuit -- where Securus filed the first petition for review -- and all other petitions for review should have been transferred to that court.” Securus said it had filed the only “valid petition ‘within ten days after’ publication of the first part of the Order in the Federal Register.” The 5th Circuit is widely considered among the most conservative and anti-regulatory of the circuits.
Securus also challenged the substance of the IPCS item in the brief, citing “basic errors of statutory interpretation,” which “led the FCC to conclude rate caps that -- by its own estimation -- are below cost for one-third of IPCS providers … nonetheless ‘fairly compensate’ all IPCS providers." The FCC also “dramatically understates IPCS providers’ costs,” excluding the costs of safety and security. “The FCC’s conclusion that IPCS rates should not pay for those safety and security measures does not make those costs disappear,” Securus said. “A more accurate calculation would show that the rate caps place more than half of all providers underwater.”
The FCC’s treatment of the costs of Communications Assistance for Law Enforcement Act (CALEA) compliance, call monitoring and call recording, “is especially arbitrary,” Securus said. “All involve call monitoring and recording to assist law enforcement officials. And all are legal requirements, the first in a federal statute, the latter two required by government officials.” The FCC allowed for recovery of CALEA compliance costs, which are far cheaper, but not for monitoring or recording, the company noted. “Such a results-oriented approach designed to yield the lowest possible rates is arbitrary and capricious -- and it is not the standard the FCC claimed to be applying.”
State and law enforcement interests urged the 1st Circuit to reject the item. They agreed with Securus that the 5th Circuit was the proper venue for the case. “The lottery that resulted in [a] transfer was improper,” they said.
The order “goes well beyond” the FCC’s statutory authority “and does nothing to aid States and their sheriffs in accomplishing the balance between costs and access in correctional facilities,” state and law enforcement interests told the court. “The FCC set out to lower rates charged to inmates for phone calls, but in doing so, it promulgated an Order that exceeds its authority and makes an inmate’s benefit supreme -- largely discrediting the very real costs associated with States providing access to IPCS … and ignoring safety and security measures that are demonstrably necessary for IPCS.”
The brief was signed by Indiana, Arkansas, Louisiana, Alabama, Florida, Georgia, Idaho, Iowa, Mississippi, Missouri, Ohio, South Carolina, South Dakota, Tennessee, Texas, Utah and Virginia, along with law enforcement officials from Louisiana.
But petitioners Direct Action for Rights and Equality, Criminal Justice Reform Clinic and the Pennsylvania Prison Society challenged the item, arguing that it imposes unnecessary costs on prisoners and their families. In addition, the groups challenged how rates are calculated. “The Commission’s inclusion of certain costs in both the lower bounds and upper bounds of the zones of reasonableness used to set the new rate caps was contrary to law and arbitrary and capricious,” the advocates said: In determining the lower bounds of the rates, the FCC “unlawfully and unreasonably included safety and security costs in the form of ‘communications security services,’ but those costs predominantly serve law enforcement and surveillance purposes, and are therefore not ‘necessary’ to the provision of IPCS nor used and useful to IPCS consumers.”
The FCC also wrongly included a 2 cent “additive” in the rates to account for “correctional facility costs,” the public interest groups said. “The Commission did so even though the existence of any such costs is entirely speculative,” they said: The amount was estimated “based on decade-old data that it has repeatedly recognized -- including in the Order itself -- to be unreliable and inaccurate.”