Small Break for Hobbyist Drone Operators: D.C. Circuit Tosses Aircraft Registration Rule

fhh drone-3FAA Violated Clear Language of the Law

The United States Court of Appeals for the D.C. Circuit last week, in Taylor v. Huerta, determined that the FAA’s registration rule cannot apply to small unmanned aircraft (aka, sUAVs, or drones) operated for recreational purposes.

Drones operated for recreational purposes, which FAA terms “model aircraft”, are defined by the FAA Modernization and Reform Act of 2012 (the “Act”) as “unmanned aircraft that [are] – (1) capable of sustained flight in the atmosphere; (2) flown within visual line of sight of the person operating the aircraft; and (3) flown for hobby or recreational purposes.”

As we’ve reported, the registration rule, adopted by the FAA in 2015, requires that owners of model aircraft register with the FAA, and imposes civil and criminal penalties (including prison time) for those model aircraft owners who don’t comply.

John Taylor, a model aircraft hobbyist in the D.C. area, challenged the registration requirement (as well as an Advisory Circular, discussed below) on the basis that the FAA lacked the authority to issue the rule. Much to his delight, and likely the Court’s, this was one of the simplest cases of statutory interpretation the Court has ever seen. In a few short paragraphs, the D.C. Circuit determined that adoption of the rule was in violation of Section 336 of the Act, which directly prohibits the FAA from promulgating “any rule or regulation regarding a model aircraft.”

Taylor’s Advisory Circular challenge was less successful. Advisory Circular 91-57A, which the FAA revised in 2015, provides that model aircraft can’t fly within the Flight Restricted Zone covering Washington, D.C. and the surrounding areas without specific authorization. For those living in the D.C. area, these flight restrictions really limit the fun, forcing sUAV pilots to drive far out of the city to find lawful airspace. Taylor argued, among other things, that the Circular violates Section 336(a) of the Act because it, too, is a rule regarding model aircraft. Unfortunately, Taylor missed the bus (or should we say aircraft) on this one. The Court did not even reach the merits of the claim, instead throwing it out as untimely. (A person seeking to challenge an FAA order must do so within 60 days of the order’s issuance. Taylor, however, didn’t file until more than two-months after the 60-day deadline had passed.)

So, to all the amateur model aircraft operators out there, fly on. But if you’re local to us in the D.C. area, just be careful where you do it.

FCC Begins Rollback of Net Neutrality Rules

On May 23, 2017, the Federal Communications Commission released a Notice of Proposed Rulemaking (NPRM) proposing the reversal of the agency’s 2015 Title II Order which subjected Internet service providers (ISPs) to regulation as telecommunications services pursuant to Title II of the Communications Act of 1934, as amended.

In a 2-1 vote along partisan lines, the Commission proposed rolling back the net neutrality rules based largely on the grounds that the Title II regulatory framework for ISPs has dramatically decreased broadband infrastructure investment.  Instead, as stated by Chairman Pai, the repeal of the “utility-style regulation of the Internet” would enable a return to the “Clinton-era light-touch framework that has proven to be successful” in encouraging investment and innovation in the Internet.  However, reflecting the highly partisan nature of the decision, Commissioner Clyburn opposed the adoption of the NPRM on the grounds that she had “yet to see a credible analysis that suggests broadband capital expenditures have declined” since 2015, and over concerns regarding the anti-consumer effects of repealing the net neutrality rules.

Proposed Changes

The Commission proposed the following changes to the net neutrality regime in the NPRM:

  • Reclassification of Broadband Internet Access Service Providers. The Commission proposed to reclassify broadband Internet access service (BIAS) providers as information service providers regulated pursuant to Title I – as opposed to classifying such providers as telecommunications service providers regulated under the more burdensome provisions of Title II.  The proposal to reverse the regulatory classification of BIAS providers was based on three factors:  (1) the plain meaning of the definitions of “information services, ” “telecommunications,” and “Internet access services” in the Act; (2) pre-2015 FCC precedent reflecting a bipartisan consensus favoring regulation of Internet access services as information services; and (3) studies indicating that Title II regulation of ISPs has “depressed broadband investment and reduced regulatory innovation” due to increased regulatory burdens and uncertainty.
  • Reclassification of Mobile Broadband Internet Access Services. The FCC proposed to reduce regulatory burdens on wireless Internet services through the reclassification of mobile BIAS as private mobile services – as opposed to being classified as commercial mobile services.  Relatedly, the Commission also proposed to reinterpret the meaning of “public switched network” under Section 332(d)(2) of the Act to focus only on the traditional public switched telephone network to prevent mobile BIAS from being considered the “functional equivalent” of commercial mobile services – while otherwise being classified as private mobile services.  The Commission stated that reclassification of mobile BIAS would “substantially benefit the wireless marketplace and consumers and have few, if any, policy disadvantages.”
  • Elimination of the FCC’s Authority over ISP Privacy Practices. The Commission proposed to “respect the jurisdictional lines drawn by Congress” providing the Federal Trade Commission with authority over ISP privacy practices given the FTC’s “decades of experience and expertise in this area.”  The FCC stated that it was compelled to cede all of its authority over ISP privacy practices to the FTC due to Congress’s rejection of the 2016 Privacy Order pursuant to the Congressional Review Act.
  • Elimination of the Internet Conduct Standard. The FCC proposed to eliminate the Internet conduct standard, which allows the Commission to prohibit practices that unreasonably interfere with or disadvantage the ability of consumers to access Internet content.  The Commission stated that the standard was too vague to administer successfully, and was based on “theoretical problems” requiring ISPs to “guess at what they are permitted and not permitted to do.”  In keeping with the NPRM’s deregulatory approach, however, the Commission did not propose an alternative approach to monitoring the conduct of ISPs – elsewhere suggesting the regulation of ISPs through either self-governance or an ex post enforcement mechanism.

Additionally, the Commission proposed the review of the following elements of net neutrality:

  • ISP Bright-Line Rules. The FCC requested comment on whether to keep, modify, or eliminate the bright-line rules regarding ISP conduct (e., no blocking, no throttling, no paid prioritization, and transparency rules).  In supporting the need for the review of the rules, the Commission contended that there was “virtually no quantifiable evidence of consumer harm” which the rules sought to prevent, and reasoned that the rules were unnecessary in light of the fact that existing antitrust regulations sought to curb the anticompetitive conduct prohibited by the regulations.
  • Ex Ante Enforcement Approach. Relatedly, the FCC questioned in the NPRM whether the agency’s ex ante enforcement approach to broadband regulations was necessary.  Instead, the Commission requested comment on whether either self-governance by ISPs or an ex post enforcement framework would serve as a sufficient enforcement framework for the broadband industry under a Title I regulatory regime.

Lifeline

Although the Commission proposed the elimination of many aspects of net neutrality championed by the Wheeler administration, the agency proposed to maintain Lifeline support for broadband services and facilities.  Citing its previous decision in the 2011 Universal Service Transformation Order, the Commission reasoned that Section 254 of the Act enabled the agency to continue universal service support for broadband services and facilities following the reclassification of ISPs as information services.

Legal Authority

Finally, the Commission requested comment on the legal basis for the rollback of the net neutrality rules – specifically whether Sections 706 and 230 of the Act provide sufficient authority for such an action.  The Commission questioned whether the agency should continue to maintain the post-2010 interpretation of Section 706 (i.e., that the section provides the FCC with an express grant of rulemaking authority in the area of BIAS), or return to the pre-2010 hortatory understanding of the section – therefore requiring the Commission’s legal authority to be based elsewhere in the Act.  Likewise, the Commission requested comment on whether Section 230 permitted the FCC to retain any rules adopted in the Title II Order by providing the agency with express statutory authority over BIAS.

Cost Benefit Analysis

Seemingly reflecting upon the emotionally-charged atmosphere surrounding the review of the net neutrality rules, Commissioner O’Rielly requested that commenters in the proceeding support their arguments for and against the rollback of the Title II Order by providing evidence substantiating their claims.  As such, the Commission proposed to conduct a cost-benefit analysis (CBA) regarding the rollback of the net neutrality rules – which is to be presumably based on quantifiable data provided by commenters.  In conducting the CBA, the FCC proposed to follow the Office of Management and Budget’s standards for “Identifying and Measuring Benefits and Costs.”  Nevertheless, the Commission questioned whether there were any concrete benefits to preserving the current net neutrality regime.

Comments in the proceeding are due July 17, 2017, and Reply Comments are due August 16, 2017.

Please feel free to contact our firm should you be interested in submitting comments in the proceeding, or have questions regarding the regulatory changes for ISPs proposed in the NPRM.

The Commission Extends Transition Progress Reporting Requirement to Non-Reimbursable Stations

Last week, the Commission adopted transition progress reporting requirements for broadcast television stations that will be changing channels during the post-incentive auction transition, but that are ineligible for reimbursement from the TV Broadcast Relocation Fund. The Commission had already decided back in January that TV stations eligible for reimbursement from the Fund would be required to report their progress by detailing the status of their construction and how they have spent reimbursement funds.

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FCC Proposes to Eliminate Main Studio Rule for Broadcasters

On May 18, 2017, the Federal Communications Commission proposed to eliminate the rule requiring radio and television broadcasters to maintain a main studio located at or near a station’s community of license.  The Commission proposed the repeal of the rule on the grounds that the ubiquity of electronic communications eliminated the necessity of a studio’s physical presence to ensure adequate communication and cooperation between a broadcaster and the community it represents.  While all three Commissioners agreed to adopt the Notice of Proposed Rulemaking (NPRM) proposing the elimination of the main studio rule, Commissioner Clyburn expressed serious reservations about the effects of eliminating the rule on relations between broadcasters and the communities they serve.

The Commission also proposed the elimination of several regulations ancillary to the main studio rule itself, including:  (1) the requirement that a main studio have a “meaningful management and staff presence” to fulfill the main studio’s function; (2) the requirement that a broadcaster ensure that its main studio has “continuous program transmission capability”; (3) informal application requirements for relocating a main studio; (4) FM station studio location requirements within a station’s principal community contours; and (5) permissive changes to a studio’s location.  The Commission justified the elimination of these regulations on the grounds that they would be rendered meaningless by the absence of the main studio rule.  However, the Commission proposed to retain the requirement that broadcasters maintain either a local or toll-free telephone number for their stations in order to ensure that community members continue to have access to their local broadcast stations.

By issuing a NPRM, the Commission has invited public comment on its proposal to eliminate the main studio rule and its associated regulations.  The Commission is particularly concerned with the costs faced by broadcasters in compliance with the rules, and whether the purpose and effect of Section 307(b) of the Communications Act – which requires that the FCC distribute broadcast stations and licenses in a manner that is “fair, efficient, and equitable” – could still be fulfilled following the elimination of the rules.  Finally, the Commission has requested comment on whether physical access to a station’s public inspection file (for stations that continue to maintain parts of their files in physical form) must be ensured through other means – such as placing the file in a local library – following the repeal of the rules.

Comments and Reply Comments on the proposed elimination of the main studio rule and its associated regulations will be due thirty and forty-five days, respectively, after the NPRM is published in the Federal Register.

Please contact Dan Kirkpatrick at (703) 812-0432 or Keenan Adamchak at (703) 812-0415 if you would like to submit a comment in the main studio rule elimination proceeding, or have any questions regarding the potential changes to your station’s compliance obligations as a result of the proceeding.

FCC Temporarily Waives International Traffic Reporting Requirements

The Federal Communications Commission recently issued a temporary waiver of its international traffic and revenue reporting requirements while it contemplates a more permanent scaling-back of regulatory burdens associated with international telecommunications services.

Long-time readers of our blog may recall that we reported on FCC “reductions” to international reporting obligations a few years ago – but that endeavor ended with new reporting obligations that appeared to keep the overall regulatory burden at a constant.  This time around the FCC appears geared towards a more significant reduction or elimination of these burdens. Continue Reading

FCC Opens Broad Review of Wireless Siting Impediments

 

(Commission is looking for ways to streamline the site permitting process)

tower-4At its April 2017 meeting, the FCC finally adopted a long awaited Notice of Proposed Rulemaking and Notice of Inquiry addressing the many frustrations faced by tower builders, wireless carriers, and others who have run the painful and often lengthy gauntlet of getting a local building permit for a communications station.   The Commission had been hearing a chorus of complaints from the tower and wireless industries that local permitting authorities and Native American tribes were seriously slowing down the permit process and often charging excessive “fees” for reviewing the applications.  With the prospect of hundreds of thousands of microcells being needed in connection with the imminent arrival of the Internet of Things, these costs and delays threatened to cripple not only the nation’s ability to roll out microcell technology but also the construction of the macrocells needed to serve rural areas that continue to suffer from a lack of high speed broadband.  The FCC heard the cries of its people and has proposed a number of actions to address these issues. Continue Reading

FCC v. Colbert – A Controversy Based on Truth or Truthiness?

Last Monday, during his monologue on the Late Show, Stephen Colbert made a number of jokes at President Donald Trump’s expense, including lobbing a series of insults at the President.  (The full monologue is available here; check around 11:15 for the portion that has gotten folks talking).   One of these insults, which included a joking reference to oral sex involving President Trump and Russian President Vladimir Putin, has created quite a stir.  While such a joke could certainly be expected to draw attention, some of the reaction to it, and in particular the reaction to the FCC’s reaction, is probably overblown in light of the governing legal principles involved.

Not surprisingly, Colbert’s joke led to at least some complaints being filed with the FCC.  This is not in any way uncommon, as perhaps most programming with even a hint of sexual content will draw a complaint from somewhere.  (The joke also got a large response on Twitter and in the media generally, including calls for boycotts and Colbert’s firing, but our focus here is on the FCC).   While most such complaints are ultimately resolved with little or no publicity, it seems inevitable that that was never to be the case here.  With a President who has been highly critical of the press, a late-night host who has in turn been highly critical of the President, an FCC Chairman who has been recently appointed by that President, and the polarized political climate of the moment, this was certainly not a spat that could fly under the radar.

During a couple of press interviews shortly after the Colbert monologue, FCC Chairman Ajit Pai was asked about the incident, and confirmed that the Commission has received “a number” of complaints.  Chairman Pai went on to say (in a May 4 interview with Philadelphia radio station WPHT), that “[the FCC was] going to take the facts that we find and we are going to apply the law as it’s been set out by the Supreme Court and other courts and we’ll take the appropriate action,” which he indicated would typically involve a fine in the event a violation was found.

The Chairman’s response has itself created something of a firestorm, leading to a number of articles suggesting that the FCC is “going after” Colbert, presumably with some political motivation.  Some commentary has characterized the FCC investigation as censorship, and the Writers Guild of America has argued that the Chairman’s comments indicated a “willful disregard for the First Amendment.”  At least at this point, this rhetoric seems a bit overblown.  While the Commission could, of course, take action in this proceeding that would cause legitimate controversy, it seems that so far, all the Chairman has done is to admit that the FCC has received complaints, confirm that it will do its job in resolving them, and acknowledge the limits on the Commission’s authority.

Under the Commission’s rules and precedents, when it receives a complaint regarding allegedly indecent or obscene programming, it is required to look into that complaint.  In doing so, and in imposing any type of penalty based on its findings, the Commission is bound to follow, as Chairman Pai acknowledged, “the law as its’s been set out by the Supreme Court and other courts.”  That law in this case is quite clear, and would, in my opinion, make it extraordinarily unlikely that the Commission will impose any sanction on Colbert.

As the Chairman noted in his public comments, Colbert’s monologue aired after 10:00 pm and, as such, would need to be “obscene” to warrant a sanction, rather than simply “indecent.”  For programming airing between 6:00 am and 10:00 pm, the Commission can impose fines or other sanctions for programming that it finds to be “indecent” or “profane.”  The standards for indecency and profanity have historically been very difficult for the Commission to define, and almost every time the Commission imposes fines for such programming, they are controversial.  Nonetheless, such fines are not terribly uncommon.

The standard for “obscene” programming, however, has been pretty clearly defined by the Supreme Court.  The Court has established a three-prong test for “obscene” programming, which must 1) applying contemporary community standards, appeal to an average person’s prurient interest, 2) depict or describe sexual content in a “patently offensive” way, and 3) taken as a whole, lack serious literary, artistic, political or scientific value.  If content is deemed obscene (whether it is broadcast content or otherwise), it no longer is protected by the First Amendment and can therefore be regulated.  As a practical matter, it is extraordinarily difficult to satisfy this test, as can readily be demonstrated by the continuing legality of the pornography industry (or any site you could find within three clicks on the Internet).  Indeed, while the FCC in recent years has addressed numerous indecency claims, and imposed often stiff penalties for indecent broadcasts, it has not done so for allegedly obscene programming.  In light of the inclusion of Colbert’s statement in a clearly political monologue, and the fact that it was almost certainly not intended to appeal to prurient interests (i.e., it was not intended to be arousing), it would be clearly contrary to precedent for the FCC to find obscenity here.

Because the FCC has received complaints regarding Colbert’s monologue, it must at least review them, as well as the underlying programming.  Consistent with precedent, however, there is simply no violation deserving of punishment.  While some may have preferred that Chairman Pai say this explicitly, such a statement would open an entirely separate set of concerns in the form of an FCC Chairman prejudging an ongoing proceeding.   Based on the law, however, and at least as regards the FCC, it seems that all the sound and fury regarding Colbert’s joke really will signify nothing.

FCC Public Notice Seeks 411 on Broadband for Health IT

medical-telemetry-1Imagine if all Americans had seamless remote access to doctors and hospitals throughout the country, if an individual in Angle Inlet, MN (total population of 60) could consult with a doctor in Minneapolis without ever having to leave the comfort of his own home, or if a surgeon in Washington, DC, could perform an operation on an individual located in Charlotte, NC via robotics.

As the FCC notes, “the future of modern health care appears to be fundamentally premised on the widespread availability and accessibility of high-speed connectivity. By some estimates, broadband-enabled health information technology can help to improve the quality of health care and significantly lower health care costs by hundreds of billions of dollars in the coming decades.” Unfortunately, the U.S. remains behind some advanced countries in the adoption of such technology.

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FCC’s EEO Policies Subject of Re-examination and Update

help-wanted-ads-1The FCC’s policies with regard to diversity generally have taken center stage over the past few days.  First up, on Friday, April 21, the Commission released a Declaratory Ruling which updated its policy as to whether the use by broadcasters and multichannel video programming distributors (MVPD’s) of only Internet-based recruitment sources provides sufficiently wide dissemination of news about full-time job openings.  In a ruling some might describe as an overdue recognition of reality, the Commission determined that use of non-Internet sources is no longer necessary.  Then, on Monday, April 24, FCC Chairman Pai announced that he intends to establish a new Advisory Committee on Diversity and Digital Empowerment.  The stated mission of the Advisory Committee is to provide recommendations to the FCC with regard to providing opportunities for all Americans to participate in the communications marketplace, without regard to race, creed, gender, ethnicity, or sexual orientation.  Both moves were generally praised in the industry.

The Declaratory Ruling represents a significant change in the policy established when the Commission adopted its current EEO rules in 2002.  At that time, the Commission considered the possibility of recruiting applicants for full-time openings through use of the Internet.  It stated that the purpose of the EEO rules is to ensure that all applicants are afforded equal opportunity and non-discrimination, and not just to bring about the proportional representation of certain groups.  In order to achieve that goal, it would be necessary to make sure that all segments of the population heard about job openings, and none were inadvertently excluded just because they did not know to apply.  Accordingly, the FCC’s EEO rules and policies emphasize wide dissemination of recruitment information.

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The More Things Change, the More They Stay the Same – UHF Discount Restored

fcc building-1The Commission has acted to restore the UHF discount used to calculate audience reach in connection with determining compliance with television ownership limits.  The national ownership cap currently limits the number of stations one owner may control to those which reach no more than 39 percent of national television households (with reach defined as the number of households in a station’s DMA).  In adding up the number of households reached nationwide by a particular owner’s TV stations, for a station which operates on a UHF channel, half of the households in its DMA are not included in the total count.

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