Federal appellate court judges sided with CenturyLink's Qwest Communications in ruling Free Conferencing (FC) intentionally interfered with Qwest's tariff contract with local carrier Tekstar. An 8th U.S. Circuit Court of Appeals panel Tuesday affirmed 2-1 a district court decision that found FC liable and awarded Qwest almost $1 million in damages plus attorneys' fees. When Tekstar agreed in 2008 to pay FC a per-minute fee for hosting conference calls on its exchange, "FC knew that Qwest was refusing to pay Tekstar for its free conferencing traffic," which Qwest considered invalid under a tariff, said Judge Jane Kelly's majority opinion in Qwest v. Free Conferencing, No. 17-2412. Suspecting Tekstar had an impermissible agreement with FC (and others) for conferencing services, Qwest implemented a new least-cost-routing protocol under which it continued to transmit some of Tekstar's free-conferencing traffic (including FC's) on its own network but refused to pay for it, she wrote. After the FCC in 2009 found free-conferencing companies weren't "end users," she said, Qwest sued several local carriers and free-conferencing companies, including FC under Minnesota law "for tortiously interfering with its contract (tariff) with Tekstar." The district court ruled FC interfered by inducing Tekstar to breach the tariff and bill Qwest for impermissible access charges. On appeal, the 8th Circuit panel majority disagreed with FC arguments, found the district court didn't err in its findings and ruled there was no basis for reversal. Dissenting Judge Bobby Shepherd found Free Conferencing didn't induce a breach: "Tekstar willingly participated in the breach, even preparing the contract." FC didn't comment.

DOJ and 14 state attorneys general offices discussed “ways the department and state governments can most effectively safeguard consumers using online digital platforms,” Justice said. The topic of the Tuesday meeting evolved over time (see 1809210047), after President Donald Trump attacked online platforms for alleged conservative bias and threatened antitrust action. “The discussion principally focused on consumer protection and data privacy issues,” Justice said. Those attending included Attorney General Jeff Sessions, Deputy AG Rod Rosenstein, Acting Associate AG Jesse Panuccio and Assistant AG Makan Delrahim. State officials included Alabama AG Steve Marshall, California AG Xavier Becerra, District of Columbia AG Karl Racine, Maryland AG Brian Frosh and Mississippi AG Jim Hood, all Democrats, and Louisiana AG Jeff Landry, Nebraska AG Doug Peterson, Tennessee AG Herbert Slatery and Utah AG Sean Reyes, all Republicans. AG offices from Arkansas, Arizona, Missouri, Texas and Washington sent staff. A federal probe of online platforms would be “inappropriate, undermine the free speech rights of tech platforms and ultimately do a disservice to consumers,” the Information Technology and Innovation Foundation wrote in USA Today. “These businesses have no incentive to inject bias in their platforms, because consumers across the political spectrum use social media and discriminating against any of them could drive people away,” wrote ITIF Vice President Daniel Castro and Research Assistant Michael McLaughlin. Delrahim at a separate appearance Tuesday on antitrust efforts committed Justice to “accelerating the pace of merger review consistent with enforcing the law because we believe that doing so is good for American consumers and taxpayers.”

Craig Newmark is in contact with Facebook, Google and Twitter about The Markup, an investigative journalism platform that will use data science to cover big tech, the Craigslist founder said Monday. Newmark, who won't have an editorial role in the new venture, contributed $20 million, and it's headed in part by ex-ProPublica journalists. Newmark said at the National Press Club that he's working “quietly and diplomatically,” talking to online platform representatives, platform critics and reporters, “to make sure everyone plays well together.” Asked if representatives from Facebook, Google and Twitter are involved in discussions, Newmark said, “It involves everyone.” The event’s moderator noted a New York Times article on the new venture describes concerns that The Markup’s data collection practices might violate platform terms of service. “Getting to the truth” often requires data science, Newmark said. There’s a lot of conjecture about tech platforms, and “we need something real,” he said. Journalism is in “crisis,” he said, suggesting The Markup adopt values that are in line with The Trust Project, a media company collaboration aimed at creating more trust in the press. Asked about platform bias, given claims coming from the White House and conservative lawmakers, Newmark said he's more interested in the details of platform terms of service and whether companies are upholding promises. He backed more enforcement to hold platforms accountable. Newmark also suggested consumers should have a certain level of “media literacy,” the ability to sniff out when a news story is “fake.” National Religious Broadcasters CEO Jerry Jones warned big tech platforms Friday there will be calls to re-examine Section 230 of the Communications Decency Act if platform bias isn't addressed this year.

Disney/Fox will likely shed its Sky stake, but Hulu's fate is unclear, said analysts after Comcast's $40 billion auction bid over the weekend that was accepted by Sky's independent committee (see here). Comcast will likely follow up with deal that has it buying the rest of Sky from Disney/Fox "for the same stupendous price," and possibly as part of a swap where Disney takes Comcast's stake in Hulu, MoffettNathanson analyst Craig Moffett wrote Monday. He downgraded Comcast stock to neutral. He said Sky could be "an albatross" for Comcast given its satellite TV business and that satellite video distribution "is increasingly becoming obsolete." He said expanding Sky's nascent over-the-top business will be a challenge, with a variety of programmers going direct to consumer, meaning Comcast will have to ramp up creation of its own video content. BTIG's Richard Greenfield wrote investors Monday that given cord-cutting and cord-shaving trends, Disney/Fox and Comcast/Sky are "actually depressing" examples of legacy media staying locked in a comfort zone. He said Disney/Fox will likely tender its Sky stake as part of Comcast's offer to Sky shareholders since there's not an obvious strategic benefit to Disney/Fox remaining an investor in Sky. The analyst said Disney wants Comcast's Hulu stake, but Comcast isn't likely to sell since it can thus prevent Hulu from becoming a Disney-branded OTT service. He said with the Sky deal, Comcast is signaling that a deal for Charter Communications seems unlikely and that U.S. expansion isn't a priority. Instead, Discovery could be the next acquisition target for Comcast given Discovery's investments in Europe in recent years, Greenfield said. Comcast plans to keep its stake in Hulu, an informed person said. U.K. M&A rules are such that it couldn't make a side deal with Disney to sell its portion, the person noted. Comcast didn't comment. The company closed down 6 percent at $35.63.

Oral argument is scheduled Feb. 1 on challenges to the FCC's net neutrality rollback, said an order (in Pacer) of the U.S. Court of Appeals for the District of Columbia Circuit Friday, in Mozilla v. FCC, No. 18-1051. It said the three-judge panel is usually revealed 30 days before argument. Petitioner and intervenor briefs seeking to vacate the order were filed in August (see 1808210010 and 1808270040). Responses of the DOJ/FCC and supportive intervenors are due Oct. 11 and Oct. 18, respectively. The Supreme Court is reviewing appeals of a 2017 D.C. Circuit ruling upholding the prior commission's 2015 net neutrality order.

The FCC Office of Managing Director made nonsubstantive revisions to authority citations in the Code of Federal Regulations to conform with Administrative Committee of the Federal Register regulations and Office of the Federal Register document drafting handbook, said an order Friday.

The North Carolina Broadcasters Association met FCC staff about the hurricane response Friday, according to tweets from FCC Chairman Ajit Pai and aide Zenji Nakazawa. “Broadcasters in N.C. are stepping up,” said Nakazawa. Friday’s FCC disaster information reporting system report showed improvement in the number of cable and wireline subscribers out of service in North Carolina, with 176,388 out, compared to 270,688 Thursday (see 1809200058). Out-of-service cellsites in North Carolina went to 2.1 percent from 3.7 percent, and all public safety answering points are operational. Two North Carolina TV stations are off-air, along with 20 FM and two AM stations. The deadline for regulatory fees was extended two days for entities in areas affected by Florence, said an Office of the Managing Director public notice Friday. Fees are now due Thursday for companies in affected counties in North Carolina, South Carolina, Georgia and Virginia, the PN said, listing the counties. All other regulatory fee payers still have their fees due on Tuesday, the original date.

A federal court gave broad meaning to "automatic telephone dialing systems" covered by Telephone Consumer Protection Act robocalling restrictions. "The statutory definition of ATDS includes a device that stores telephone numbers to be called, whether or not those numbers have been generated by a random or sequential number generator," said the unanimous opinion Thursday of a three-judge panel of the 9th U.S. Circuit Court of Appeals, in Jordan Marks v. Crunch San Diego, No. 14-56834. It reversed a district court summary judgment in favor of Crunch Fitness. Marks claimed three text messages from Crunch violated the TCPA, but the lower court found the system used wasn't an ATDS. The 9th Circuit noted Congress left ATDS alone in revising the TCPA after an FCC 2015 ATDS decision: "Because we infer that Congress was aware of the existing definition of ATDS, its decision not to amend the statutory definition of ATDS to overrule the FCC’s interpretation suggests Congress gave the interpretation its tacit approval." Since the 1991 TCPA, "no Court or FCC ruling has so expansively defined an [ATDS] as the Ninth Circuit has," emailed Scott Goldsmith of Dorsey & Whitney, who wasn't involved in the case: "By defining an ATDS as equipment that simply has 'the capacity to dial stored numbers automatically, the Ninth Circuit may have just rendered every smart phone user a potential TCPA violator. The ruling may be short-lived, however, as the FCC is poised to issue its new TCPA ruling" (see 1809190036). He said the D.C. Circuit, when it overturned the 2015 definitions (see 1803160053), "did so with the concern that the FCC’s interpretation could render every day smart phones an ATDS subject to the TCPA. Ironically, the Ninth Circuit’s ruling in Marks appears to do just that." It's likely Crunch will seek Supreme Court review of the ruling, which "conflicts" with a 3rd Circuit June ruling on autodialer functionality in Dominguez v. Yahoo, Goldsmith told us Friday. Crunch didn't comment. The National Consumer Law Center believes the ATDS definition should be broad (see 1809200059) but contain a carve-out for "ordinary use of a smart phone," emailed Senior Counsel Margot Saunders, noting the D.C. Circuit "recommended that the FCC use its exemption authority to deal with that issue."

Federal Emergency Management Agency officials expect the same kinds of problems to be uncovered during the first national test of the wireless emergency alert system as during a Washington-area test in April, they told reporters Friday. Preliminary results likely won’t be released immediately, an FCC official said. The test was delayed until Oct. 3 because of Hurricane Florence (see 1809170035). The April test saw many subscribers not getting the alerts (see 1804050053). Industry observers expect similar glitches Oct. 3. “The test will assess the operation readiness of the infrastructure,” a FEMA official said: “We expect there to be fairly similar results” to the April test. Government officials spoke on a conference call with reporters on the condition they not be identified. “Almost all [wireless] phones across the country” will receive the warnings, “but we know there are some anomalies in the network,” a FEMA official said. More than 70 percent of the cellphones will likely “receive and display” the message, the official said. The FCC will work closely with FEMA and industry to assess the test, a commission official said. FEMA officials noted 2016's Integrated Public Alert and Warning System Modernization Act requires the system be tested every three years. WEAs can warn of severe weather, active shooters and Amber alerts. WEAs fall into three categories -- warnings of imminent threats from severe weather to active shooters, amber alerts for missing children and the presidential-level alert, a FEMA official said. The national presidential-level alerts are only issued during extreme emergencies, such as a declaration of war or if there were coordinated terrorist attacks in major cities, the FEMA official said. Those concerned about the test continue tweeting, now using a new hashtag: #GoDark103. “What are you solving by participating in #GoDark920 or #GoDark103?” @realchrishanken tweeted Friday. “You don’t like Trump. I get it. I don’t like him either. But these presidential alerts have been around for longer.”

Turning over nondisclosure agreements signed by FCC commissioners or other staff would reveal staffers who now have or have had access to classified materials, which could subject them to harassment and unwanted attention, the agency said Wednesday, denying our Freedom of Information Act request. It said such a request fell under FOIA exemptions 6 and 7(E), covering personnel files that would constitute an invasion of personal privacy and records that would disclose techniques and procedures for law enforcement investigations, respectively. The agency provided a blank Standard Form 312, the federal government's classified information nondisclosure agreement.