Recent FCC Actions Signal Increased Enforcement and Reduced Leniency

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At one time or another, you have undoubtedly heard the following expression:

“We don’t need more regulations. We just need to enforce the ones we already have on the books!”

Under the leadership of recently installed Chairman, Tom Wheeler, the Federal Communications Commission (“FCC” or “Commission”)(with the help of sister agency, the Department of Justice (“DOJ”)) is making a very real effort to bring the expression to life.  Several of our attorneys have been informed of major changes in FCC Enforcement Bureau policy in the past few months.  The information conveyed through Bureau staff and other experiential knowledge was recently affirmed by Acting Enforcement Bureau Chief, Travis LeBlanc, at an event hosted by the Federal Communications Bar Association.

On occasion, our Firm will disseminate guidance to our entire client base on regulatory issues and developments of importance to various industry segments.  We typically do so through Client Advisories, which we recognize have an average “open” rate of 25-30%.  Every now and then, however, we confront regulatory/legal developments that simply demand greater awareness among our clients.  To put it bluntly, some developments are too meaningful, too material, and too potentially damaging and harmful to our clients and their fiscal health for either us or you to ignore.  We believe that the recent changes to the FCC’s “enforcement regime” — changes our Firm has witnessed, experienced, and been informed of over the course of the past several months — is one of these rare developments that warrants a pointed and detailed client briefing.

Our Firm has observed and experienced multiple indications of a sea change within the FCC with regard to its enforcement policies and procedures.  These indications are summarized below:

  • FCC Enforcement Now Extends Beyond the Enforcement Bureau; Thereby Increasing Probability of Enforcement
    • More “eyes and ears” = increased identification of non-compliance on a variety of regulatory issues = increased enforcement
  • Creation of USF Enforcement Strike Force Manifests Increased “Politicization” of Specific Regulatory Area with Widespread Impact on all Corners of the Industry
    • Dedication of internal resources targeting specific, but very broad area of enforcement that impacts the entire telecommunications and interconnected-VoIP industries, as well as ISPs and other recipients of funds
  • Systemic Deficiencies in Current “Appeals” Process, When Combined with Unclear, Uncertain and Shifting Rules (and “outcome-oriented” interpretations of existing rules), Creates Difficult & Risky Environment for Service Providers
    • The frequently preordained outcome-oriented USAC Audit/Investigatory processes lead to a complex, costly, time-consuming, and uncertain Appeals Process
  • Curtailment of Meaningful Opportunities to Negotiate Consent Decrees with Enforcement Bureau
    • Through changes in “Bureau policy,” resolution of investigations and Notices of Apparent Liability (“NAL”) through Consent Decrees is materially constrained
  • Recent Increase in Department of Justice “Collection” Activity (Threatened and Actual Lawsuits to collect FCC debts and Forfeitures) Signifies Possible Shift in Battlefields
    • Together with the lessening of opportunities to achieve a fair resolution of an investigation or NAL in front of the Enforcement Bureau, increased “collection” litigation by the DOJ opens the door to de novo trial on the merits – for those who can afford it!

If you require additional information regarding these changes to the FCC’s enforcement regime or you desire specific guidance on how these changes may impact your business, please contact the attorney responsible for your account with our law firm.  If you are not currently a client of The CommLaw Group, we suggest contacting your regulatory counsel.  If you wish to engage The CommLaw Group, please contact Jonathan S. Marashlian at jsm@commlawgroup.com or by phone: 703-714-1313.

ATTORNEY ADVERTISING DISCLAIMER: This information may be considered advertising in some jurisdictions under the applicable law and ethical rules. The determination of the need for legal services and the choice of a lawyer are extremely important decisions and should not be based solely upon advertisements or self-proclaimed expertise. No representation is made that the quality of the legal services to be performed is greater than the quality of legal services performed by other lawyers

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