Telecom Law Monitor : Washington D.C. Telecom Lawyer & Attorney : Kelley Drye & Warren Law Firm : New York, Chicago, Connecticut, New Jersey, Brussels

Implementing the Truth in Caller ID Act passed last December, the FCC adopted rules prohibiting the fraudulent manipulation of caller ID information.  These so-called anti-"spoofing" rules track the statutory language to prohibit any person from "knowingly transmit[ing] misleading or inaccurate caller identification information with the intent to defraud, cause harm, or wrongfully obtain anything of value."  The Commission also released a report to Congress recommending additional legislative changes to strengthen the spoofing protections.

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In many ways, the America Movil Notice of Apparent Liability is a typical unauthorized transfer of control case.  The company engaged in a transaction that changed its ownership without seeking prior FCC approval.  As we've noted, such cases typically generate a fine of $8,000, an amount that seems too small in proportion to other violations.   What's notable here is that the Bureau doubled the standard fine (i.e., applied an "upward adjustment") against the company that committed the violation.

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On June 17, 2011, the FCC adopted a Report and Order seeking to prevent waste and abuse by prohibiting duplicative Lifeline program subsidies for low-income consumers already receiving support. The proceeding was prompted by concerns that qualified low-income consumers may be knowingly or unknowingly receiving Lifeline support from more than one eligible telecommunications carrier (ETC) – something the FCC has determined to be contrary to the goals of the program. These concerns spurred an increase in USAC auditing and an FCC rulemaking proceeding, culminating in the Report and Order.

The Report and Order includes the following provisions:

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Yesterday, the FCC released another Notice of Apparent Liability in a "junk fax" case.  The NAL employs the Commission's standard proposed penalties for each alleged unlawful fax.  What is significant, however, is that the FCC also imposed a $150,000 penalty to deter a "more persistent wrongdoer."  This increased penalty may in fact be unlawful.

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The Commission continues to clear the decks from its 2009 Omnibus CPNI NAL.  Apparently having exhausted all of the cases warranting revocation of the NAL and meriting a consent decree, the Enforcement Bureau release five forfeiture orders for failure to file the 2007 Annual CPNI Certification.  These orders all involve a prepaid card provider and are virtually identical to the 88 Telecom Forfeiture released earlier this week.  All conclude that the $20,000 forfeiture proposed should be imposed.  None of the providers were represented by FCC counsel, which may have cost them the opportunity to settle for a few hundred to a few thousand dollars instead of $20,000.

The carriers involved are:  VoIP Alliance, Touch-Tel USA, Phone Club Corp., DigitGlobal Communications, and StraightTel Corp.

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Last month, we noted that the FCC is proposing to expand outage reporting obligations to interconnected VoIP providers, broadband Internet access providers and to Internet backbone providers.  The new rules propose reporting based on latency and jitter, and effectively would establish a minimum service quality for broadband networks.

Yesterday, the FCC published notice of the new rules in the Federal Register.  Comments on the proposed rules will be due on August 8, with reply comments due on October 7.  In addition, parties wishing to comment on the paperwork reduction requirements associated with the rules, may do so by August 8.  Those comments are due to the Office of Management and Budget (OMB), not the FCC.

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In late May, the Voice on the Net Coalition ("VON") held a series of meetings with FCC Commissioner's offices concerning VoIP regulations.  The Coalition discussed topics affecting 21 pending FCC dockets, and, according to the summary of the meetings, "expressed concern that additional regulation of the IP communications industry could deter investment and innovation ..."  The Coalition opposed a variety of new regulations:

• The Coalition opposed imposition of intercarrier compensation obligations to VoIP and argued for bill and keep for VoIP traffic;
• The Coalition opposed using advertising revenues to assess TRS obligations on VoIP providers;
• The Coalition opposed requirements to file broadband deployment reports (Form 477) and to apply FCC billing rules to VoIP;
• The Coalition urged a narrow interpretation of new disability access requirements and supported "broad waivers" of such rules; and
• The Coalition opposed the opening of a rulemaking to require E911 for mobile VoIP applications.

The Coalition also attached a chart summarizing FCC actions to regulate interconnected VoIP services.  The chart mirrors the summary we prepared back in November of the regulatory obligations of VoIP services.  VON's summary chart identifies 8 pending proceedings proposing to add regulatory obligations to VoIP service providers and details 13 previous FCC orders regulating VoIP services.  Since the Coalition prepared its chart, the FCC added one more proposed obligation:  a proposal to require interconnected VoIP providers to report their international traffic and revenues.  See Kelley Drye's Client Advisory on the international reporting obligations for more details. 

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Still working its way through the 2009 Omnibus CPNI NAL, the FCC released a forfeiture order against prepaid card provider 88 Telecom.  The Commission imposed the full $20,000 penalty proposed in the NAL, rejecting 88 Telecom's arguments that its violation was not willful and that it could not pay the forfeiture.  What is most significant about the order, however, is that the provider did not settle the allegation via a consent decree.  Most of those who did were able to settle for a few hundred to a few thousand dollars.

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