5th Circuit Tosses FCC's $57 Million Fine Against AT&T

The 5th U.S. Circuit Court of Appeals has overturned the FCC's $57 million fine imposed on AT&T, agreeing with the wireless carrier that the agency's in-house adjudication was unconstitutional. In its docket 24-60223 decision Thursday, the three-judge 5th Circuit panel said its analysis is governed by the U.S. Supreme Court's Jarkesy decision. And the court pointed to Jarkesy as it said the FCC was incorrect that its enforcement proceeding against AT&T falls under the "public rights" exception that lets Congress assign some matters to an agency instead of an Article III court. Common law suits presumptively concern "private rights" and must be adjudicated by Article III courts, they said. The judges said an in-house FCC proceeding "amputates the carrier’s ability to challenge the legality of the forfeiture order." "No one denies the Commission’s authority to enforce laws requiring telecommunications companies like AT&T to protect sensitive customer data," the judges said. "But the Commission must do so consistent with our Constitution’s guarantees of an Article III decisionmaker and a jury trial." Hearing the case were Judges Catrina Haynes, Stuart Duncan and Cory Wilson, with Duncan penning the decision. T-Mobile and Verizon are similarly challenging fines brought against them in the same April 2024 enforcement action accusing the three wireless carriers of failing to safeguard data on customers' real-time locations.

Chairman's Office Denies Commissioner Travel to NAB

White House travel restrictions are affecting FCC commissioners' appearances at the NAB Show in Las Vegas, FCC officials told us. Chairman Brendan Carr's office denied official travel requests from Commissioners Anna Gomez and Nathan Simington due to a federal freeze on agency travel, their offices told us Friday. Gomez will instead pay her own way to the show, her office said. Simington's office told us last week that his travel had been authorized by the Chairman’s Office but said late Friday that the request had been denied. NAB and the FCC didn’t comment.

Starks to Resign From FCC This Spring

FCC Commissioner Geoffrey Starks plans to resign this spring, he said in a statement Tuesday. An FCC official told us it’s not yet clear if there's a replacement Democratic commissioner lined up. Starks previously signaled that he wouldn’t leave the agency if his departure would shift the FCC to a Republican majority.

“Today I sent a letter to the President and [Senate Minority] Leader [Chuck] Schumer indicating that I intend to resign my seat as a Commissioner this spring,” Starks said in the release. “Serving the American people as a Commissioner on the Federal Communications Commission has been the honor of my life. With my extraordinary fellow Commissioners and the incredible career staff at the agency, we have worked hard to connect all Americans, promote innovation, protect consumers, and ensure national security.”

Starks served in the FCC Enforcement Bureau before becoming a commissioner in 2019. Before that he practiced law at Williams & Connolly. The release doesn't mention any future plans. “Over the next few weeks, I look forward to working with the Chairman [Brendan Carr] and my fellow Commissioners, and all FCC staff, to further the mission of the agency," the release said.

Consensus Front-Runner Pai Picked as Next President of CTIA

CTIA announced Wednesday that former FCC Chairman Ajit Pai has been named president and CEO, effective April 1. Pai replaces Meredith Baker, also a former Republican member of the FCC, who has had the job since 2014.

Pai has worked in venture capital at Searchlight Capital Partners since leaving the FCC following the end of the first Donald Trump administration. Current Chairman Bredan Carr worked for Pai, first as an aide, then as general counsel, before becoming a commissioner. Pai was from the start of the process widely viewed as the front-runner for the position (see 2412120055).

“The wireless industry is a key driver of technology innovation and investment in the U.S.” and “it helps advance America’s global competitiveness, national security, and economic security,” Pai said. “I am thrilled to get to represent the companies across our country that are creating jobs, growing the economy, and benefiting hundreds of millions of consumers every day.”

CTIA Chairman Laurent Therivel, CEO of UScellular, called Pai “the proven leader we need to head our industry at this critical stage.”

Carr Calls for Rule Elimination Suggestions

The FCC is calling for suggestions on which of its rules should be eliminated in a docket (25-133) called “In re: Delete, Delete, Delete,” the agency announced in a news release and public notice Wednesday. “The FCC is committed to ending all of the rules and regulations that are no longer necessary. And we welcome the public’s participation and feedback throughout this process,” said Chairman Brendan Carr in the release. “For too long, administrative agencies have added new regulatory requirements in excess of their authority or kept lawful regulations in place long after their shelf life had expired.” The effort is linked to White House executive orders on deregulation and the Department of Government Efficiency, the release said. “We are seeking public input on identifying FCC rules for the purpose of alleviating unnecessary regulatory burdens,” the public notice said.

Although it calls for broad comments on deregulation, the notice directs commenters to consider cost-benefit considerations, whether experience gained from implementation of a rule suggests it's unnecessary, marketplace or technology changes, and whether the governing legal framework -- such as Chevron deference -- has shifted. “Are there rules that were based on a past FCC interpretation of statutory language that should be revisited in light of" Loper Bright v. Raimondo, it asked. Comments are due 30 days after release.

11th Circuit Rejects FCC's Note 11 Penalty Against Gray

The 11th U.S. Circuit Court of Appeals agreed that the FCC was right that Gray Television violated the agency's top-four rule with the broadcast chain's purchase in 2020 of another broadcaster’s CBS network affiliation in the Anchorage market, but the court on Friday vacated the $518,000 forfeiture penalty. In a docket 22-14274 opinion, the appellate court also remanded the proceeding back to the agency. Judges William Pryor, Andrew Brasher and Adalberto Jordan said the forfeiture penalty was wrongly based in part on an egregiousness finding that Gray wasn't given an opportunity to address. They said the forfeiture penalty was also arbitrary and capricious because the FCC didn't adequately explain its consideration of Gray’s good faith. In a concurring opinion joined by Pryor, Brasher said the FCC's Note 11 rule, barring affiliation swaps, may exceed the agency's authority. "Had this issue been properly raised, I very likely would have voted to vacate the forfeiture order in its entirety," they said.

NCTA's Michael Powell to Retire

NCTA President Michael Powell is retiring by year-end, the cable industry group said Thursday. He has held the position since spring 2011. Powell, 61, spent a term as FCC commissioner, starting in November 2007, and then served as chairman from 2001 through March 2005. Powell's "strategic insight and commitment have shaped the cable industry’s most significant achievements, and his leadership will be greatly missed," NCTA board Chairman and Cox Communications President Mark Greatrex said. NCTA said it would begin a national search for a successor.

Thune: E-rate Hot Spots CRA Unlikely to Get Senate Vote This Week

Senate Majority Leader John Thune, R-S.D., told us Monday night that he is unlikely to bring up for floor action this week a Congressional Review Act resolution of disapproval (S.J.Res. 7) to undo the FCC's July 2024 order allowing schools and libraries to use E-rate support for off-premises Wi-Fi hot spots and wireless internet services. Reports circulated Friday that Senate leaders were eyeing floor action as soon as this week on S.J.Res. 7. Senate Commerce Committee Chairman Ted Cruz of Texas and 12 other panel Republicans filed the CRA measure in late January.

“We're doing” two other non-telecom CRA measures this week, led by Sens. John Hoeven, R-N.D., and John Kennedy, R-La., Thune said. “We haven't made any immediate decisions” on when other CRA measures might come to the floor. Thune acknowledged that Cruz has several CRA measures “teed up” and expects S.J.Res. 7 to eventually get a floor vote. A vote on the motion to proceed to Kennedy's CRA measure (S.J.Res. 11) was expected around noon Tuesday.

SCOTUS Rules That E-rate Reimbursements Are Claims Under False Claims Act

The U.S. Supreme Court has unanimously ruled that reimbursement requests submitted to the E-rate program, administered by the Universal Service Administrative Co., can be considered “claims” under the False Claims Act, said an opinion Friday authored by Justice Elena Kagan. The ruling in Wisconsin Bell v. U.S. allows a lawsuit by Todd Heath against provider Wisconsin Bell to go forward. “If the Government, by making direct payments, has provided even a small fraction of the money used to fund E-Rate reimbursements, the question presented here is resolved,” Kagan wrote. Both the FCC and DOJ provide portions of the funds used for E-rate reimbursements from enforcement actions against carriers, she said. “The Government was not a passive throughway for the transmission of E-rate moneys from one private party (the carrier) to another (the Administrative Company),” she wrote. “Nor were the Government’s activities confined to ‘facilitating’ such transfers, as Wisconsin Bell would have it.” Justices Clarence Thomas and Brett Kavanaugh joined the majority but also wrote concurring opinions. Thomas said the court’s ruling Friday is narrow, but the arguments made by the government would give the False Claims Act broader scope than previously understood and potentially mean that the Universal Service Administrative Co. is an agent of the government, rather than independent. That could mean it's unconstitutional, he said. “In a future case, however, we may need to confront the Government’s other arguments -- namely, that the FCA applies to funds that private parties pay to other private parties, and that the Administrative Company is an agent of the United States,” Thomas wrote. “If these issues return to us, I hope we will carefully consider their consequences.” Kavanaugh similarly said that Friday’s ruling could raise constitutional questions about the False Claims Act.

Cruz: Trump to Nominate Senate Commerce's Roth as NTIA Administrator

Senate Commerce Committee Chairman Ted Cruz, R-Texas, said Monday night that President Donald Trump is nominating panel Republican Telecom Policy Director Arielle Roth as NTIA's leader, as expected. Lobbyists had previously also tipped Roth as a top contender for former FCC Chairwoman Jessica Rosenworcel’s seat but Trump nominated Senate Armed Services Committee Republican staffer Olivia Trusty for that role instead. Roth was previously a legislative aide to former Senate Commerce member Roy Blunt, R-Mo., O’Rielly’s wireline adviser and a Wireline Bureau legal adviser. She also had stints at the Hudson Institute and Federalist Society.

Trump hadn’t formally announced his intent to nominate Roth when Cruz announced it on X. Roth “led my legislative and oversight efforts on communications and broadband policy with integrity, creativity, and dedication,” Cruz said. “She has fought to defend the taxpayer, free speech, and kids online.” Roth will serve Trump and commerce secretary nominee Howard Lutnick “well in their mission to advance government efficiency, economic growth, and innovation,” Cruz said.

11th Circuit Finds that FCC Overstepped TCPA Bounds With 2023 Robocall Order

The FCC overstepped its statutory boundaries in trying to implement the Telephone Consumer Protection Act, the 11th U.S. Circuit Court of Appeals said Friday, as it vacated part of the agency's 2023 robocall amid robotext order. In a 23-page decision (docket 24-10277), Judges Elizabeth Branch, Robert Luck and Barbara Lagoa sided with petitioner Insurance Marketing Coalition and said the 2023 order sets rules that conflict with the ordinary statutory meaning of the TCPA's "prior express consent" language. The 11th Circuit vacated the portion of the order that states that a consumer can't consent to a telemarketing or advertising robocall unless they consent to calls from only one entity at a time and consent only to calls whose subject matter is “logically and topically associated with the interaction that prompted the consent.” The 11th Circuit also remanded the order back to the FCC for further proceedings.

Trump to Nominate Senate Armed Services Aide Trusty to Rosenworcel FCC Seat; Soon to Name Roth to NTIA

President-elect Donald Trump said Thursday he plans to nominate Senate Armed Services Committee Republican staffer Olivia Trusty to the FCC seat current Chairwoman Jessica Rosenworcel will vacate on Monday. Multiple former FCC officials and communications sector lobbyists told us they expected Trump would also announce Arielle Roth, the Senate Commerce Committee's Republican telecom policy director, as his pick for NTIA administrator as soon as Thursday. A range of ex-FCC officials and other observers previously tipped Trusty and Roth as the top contenders for the Rosenworcel seat.

Trusty “will work with our incredible” incoming FCC Chairman Brendan Carr “to cut regulations at a record pace, protect Free Speech, and ensure every American has access to affordable and fast Internet,” Trump said in a Truth Social post. He misidentified her as still being a Senate Commerce Committee aide. She was previously part of Commerce staff before moving to Armed Services when current Chairman Roger Wicker of Mississippi took over as Armed Services’ lead Republican. Wicker endorsed Trusty in November for the Rosenworcel seat.

FCC Bureaus Reject Complaints Against All Four Networks

The FCC denied four challenges against broadcast stations at the bureau level in what outgoing Chairwoman Jessica Rosenworcel said is “a stand on behalf of the First Amendment.” In two orders and two letters, the agency rejected three complaints from the Center for American Rights against stations owned by CBS, ABC and NBC, and a third against a Fox-owned station from the Media and Democracy Project. The Center for American Rights complaints accused NBC of violating the FCC’s equal opportunity rules with a Saturday Night Live appearance by Vice President Kamala Harris, CBS of violating the news distortion rules by editing an interview with Harris, and ABC for its moderation of a presidential debate between Harris and President-Elect Donald Trump. The MAD filing called for the FCC to hold a hearing on Fox’s fitness to hold FCC licenses in the wake of a 2023 Superior Court of Delaware ruling on a motion for summary judgment in Dominion Voting System’s defamation case against Fox over its 2020 election reporting. The CBS and ABC complaints were rejected by the Enforcement Bureau, the Fox and NBC filings by the Media Bureau. “The action we take makes clear two things,” said Rosenworcel in a released statement. “First, the FCC should not be the President’s speech police. Second, the FCC should not be journalism’s censor-in-chief.” Incoming FCC Chair Brendan Carr has indicated support for the CAR filings.

Disney, Fox and Warner Bros. End Venu Joint Streaming Venture

Disney, Fox and Warner Bros. Discovery are calling off their planned Venu sports streaming joint venture. They announced Friday that "in an ever-changing marketplace, we determined that it was best to meet the evolving demands of sports fans by focusing on existing products and distribution channels." Parties including some Democratic members of Congress had voiced antitrust concerns about the venture. Rival streaming service FuboTV this week reached a settlement that ended its litigation in U.S. District Court for the Southern District of New York against Venu.

6th Circuit Rejects FCC's Latest Net Neutrality Order

The 6th U.S. Circuit Court of Appeals on Thursday overturned the FCC’s latest net neutrality order, reclassifying broadband as a Title II service under the Communications Act. A three-judge panel handed down the decision two months after hearing oral argument (see 2410310041).

The court held that broadband ISPs “offer only an ‘information service’” and “therefore, the FCC lacks the statutory authority to impose its desired net-neutrality policies through the ‘telecommunications service’ provision of the Communications Act.

“For almost 20 years after Congress enacted the Telecommunications Act, the FCC’s position was that companies providing access to the Internet offered information -- not telecommunications -- services, and thus, Title II’s common-carrier regulations did not apply,” the court found: “This order -- issued during the Biden administration -- undoes the order issued during the first Trump administration, which undid the order issued during the Obama administration, which undid orders issued during the Bush and Clinton administrations.”

The court also found that mobile broadband "does not qualify as 'commercial mobile service'" and cannot be regulated as a common carrier service.

The panel was made up of Judges Richard Griffin and Raymond Kethledge, who are appointees of President George W. Bush, and John Bush, one of six 6th Circuit judges that President Donald Trump appointed. Griffin wrote the decision.