Late Ex Parte Filings May Point to Wider Compliance Problem

Forty-five filings by 26 firms or groups were made more than the limit of one business day after the ex parte meeting took place. The 26 late-filers ranged in size from closely held SageTV, which said it didn’t know about filing rules, to major companies such as AT&T, Comcast, Disney, News Corp., Intel, Sprint Nextel and Verizon, and trade groups including the NAB. All filers who responded to inquiries said the missed deadlines were inadvertent, and some said FCC rules gave them leeway to file late.

The filings don’t seem to be “gaming the system” and instead point up a systematic problem in enforcement of FCC ex parte rules and in the regulations, said communications lawyers, ex-FCC staffers and others. The low number of late filings as a portion of total ex partes made during the period -- a single-digit percentage -- show that the vast majority of lobbyists follow the letter and spirit of ex parte rules, they said. “I think you will look long and hard to find any enforcement actions taken in this area,” so it appears “by and large” those who lobby the regulator follow the rules to avoid getting “a bad reputation,” said lawyer Henry Rivera of Wiley Rein, a former FCC commissioner. “That’s a very bad thing to have with those who regulate you -- in the lobbying game, credibility is everything.”

Late ex parte filings point to wider compliance problems with FCC lobbying because all such meetings are self-reported and the regulator doesn’t have a mechanism to automatically enforce rules, communications lawyers and others who reviewed our research said. “What this data does indicate, I think, is that the FCC fails to enforce its ex parte filing rules -- but we already knew that,” said Barbara Esbin, a senior fellow of the Progress & Freedom Foundation who was an FCC staffer for 14 years until 2008. “There are obviously some pretty egregious violations in this batch” given the lateness of some “and it would be interesting to know if those just fell through the cracks or were attempts to ‘hide the bacon,'” she said. Late filers said they generally follow FCC rules and weren’t trying to gain anything by filing late. The average late filing was tardy by three days, our review found. Most were late by a day or two.

The ex parte rulemaking notice set for a vote at Thursday’s meeting will seek comment on proposals to increase transparency, a commission spokesman said. “The FCC could issue these rules without notice and comment, but is choosing to proceed with a rulemaking so we can benefit from the public’s input on the proposals.” He declined to comment on our research. FCC members besides FCC Chairman Julius Genachowski declined to comment or couldn’t be reached.

British Telecom had the latest filing, reporting Friday on a Jan. 29 meeting at the World Economic Forum in Davos, Switzerland, between CEO Ian Livingston and Genachowski. The telco filed after “internal deliberations” about whether the rules apply to companies based outside the U.S., said Sheba Chacko, head of global operational regulation and author of the filing (http://xrl.us/bgwakr). “Our view is that it is not clear to us.” Media Access Project President Andrew Schwartzman, a frequent critic of ex parte rule enforcement and panelist on an FCC workshop on the subject (CD Oct 29 p6), said he “can’t imagine why the rules don’t apply to BT,” he said. MAP made no late filings, our review found.

Current rules make it hard to weed out bad apples because there’s no way to automatically require FCC visitors to make complete filings, some said, or even to file at all. Meeting participants usually e-mail their filings to those they met with, but this is a courtesy. “I can tell you sometimes folks just forget,” said Policy Director Meredith McGehee of the Campaign Legal Center, a group advocating for government transparency. “I would trust a description of the meeting more from a public official than I would from a lobbyist. ... I look at this as a symptom of a flawed system.” It’s “an honor system under which everybody is expected to be honest, forthright and accurate in their descriptions of their presentations,” said broadcast lawyer Harry Cole of Fletcher Heald. “The problem is, however, that there is no way for outside parties to confirm that any particular ex parte summary is, in fact, honest, forthright and accurate.”

“This sort of systemic lateness indicates a systemic problem somewhere,” said Public Knowledge Legal Director Harold Feld. “The fact that there is no penalty for filing late makes it enormously tempting for people who cannot make the next business day deadline to let it slip a day or two.” For small groups and nonprofits, “it may be that a turnaround time of next business day is too short.”

One late filer agreed. “It has been difficult for many nonprofit organizations to make reporting deadlines when we also face comment deadlines,” said Executive Director David Honig of the Minority Media and Telecommunications Council, which had three late filings. During a period when there were frequent deadlines for comments on aspects of the broadband plan, “we sometimes faced two or three pleading deadlines a week,” he said. “With a staff of just four, we were sometimes overwhelmed trying to keep up.” A filing one day late by the National Center for Hispanic Media, another nonprofit, “was purely a clerical error,” said Policy Counsel Jessica Gonzalez (http://xrl.us/bgwani). Consumers Union was the only other issue-advocacy group whose filings we reviewed that had any late ones, with two on program access. Officials there didn’t reply to messages seeking comment.

NAB’s single late filing during the period “was an extremely rare occurrence,” a spokesman said. “NAB was short-staffed” the day President Gordon Smith discussed broadband with all FCC members besides Genachowski (CD Nov 4 p11). “We filed on the next business day” (http://xrl.us/bgwao2). Intel’s two late filings were because of “exigencies” and included one on an e-mail from CEO Paul Otellini to Genachowski (http://xrl.us/bgwaqj), said Associate General Counsel Peter Pitsch. “Obviously, a CEO of a major corporation has a lot of things on his plate.” Disney’s three belated filings “were due to technical issues with the size of a document and staff absences,” a spokeswoman said. Others weren’t aware of the rules. “We had never done an ex parte filing before,” said SageTV Chief Technology Officer Jeffrey Kardatzke, who discussed CableCARDs last month. “We definitely would have gotten it in had we known about it.”

AT&T had six late ex parte filings, followed by four each from Fox Television Stations and Cablevision. The cable operator, with late paperwork on program access and the broadband plan, aims to ensure they're “both accurate and timely, and on rare occasions, we have slightly delayed a filing in order to ensure its accuracy,” a spokeswoman said. Verizon Wireless had three, Comcast two and Verizon Communications, Sprint Nextel and NBC Universal one each. Sprint found out a meeting on video relay systems related to an ongoing proceeding afterwards, which it “immediately corrected” by making the filing, a spokeswoman said. Representatives for AT&T, Fox and Verizon didn’t reply to messages seeking comment and spokesmen for NBC Universal and Verizon Wireless declined to comment. Comcast’s filings appeared late because executives thought CEO Brian Roberts met on a Friday with Genachowski at the CES show in Las Vegas, while they actually spoke a day earlier, a spokeswoman said. The initial Jan. 11 filing would have been timely, she said. A follow-up filing the next day wasn’t late, she said. That document expanded on the initial one.

A filing by Charter Communications (http://xrl.us/bgv963) contained one sentence saying what was discussed, but was on time. It was one of 17 company filings on the plan, a spokeswoman said: “These were the same arguments and recommendations we discussed” in an earlier meeting and “we did not present any new data or arguments that were not already on record.” The company should have referred to the earlier filing, said Schwartzman.

The broadband plan was the most frequently discussed subject in late filings, discussed in 13 of the meetings. Several of those meetings also touched on other subjects, including CableCARD rules and media ownership regulations. Net neutrality was the subject of six meetings, program access rules on withholding of cable channels affiliated with operators from competitors the subject of five and 700 MHz spectrum and the Universal Service Fund each the subject of three.

Tardy documents seem a result of “underlings filing late to meet a tiresome requirement,” said Professor Christopher Sterling of the George Washington University’s School of Media and Public Affairs, who was an FCC eighth-floor aide in the 1980s. “It was an issue back in the days of scrolls” when he worked at the FCC because “the whole process was newer.” Communications lawyers whose clients are visiting Washington for several days to attend meetings at the FCC find it “often impossible to file on time unless you stay up all night,” said broadcast lawyer Peter Tannenwald of Fletcher Heald. “Filing a week or two late might be an abuse, but a day or two late could mean there was not enough time.”