Customs Duty

The FCC should scrap its estimates on the costs for industry to comply with the February net neutrality order and recalibrate, CTIA said in a filing at the FCC on the Paperwork Reduction Act implications of the new regulations. “The Commission has utterly failed to meet its obligations under the PRA and should begin anew,” CTIA said. Others offered an equally negative take on the FCC’s cost projections, in comments in docket 14-28.

FCC proposals to revise network outage reporting rules drew mixed responses in comments on a March NPRM that were posted Thursday and Friday in docket 15-80. Wireline and wireless carriers welcomed some FCC proposals and opposed others that they said would impose undue reporting burdens on carriers without providing necessary or even useful information. Verizon said the FCC should simplify outage reporting thresholds, apply duties consistently across networks in a competitively neutral and technically feasible way, and focus only on significant network outage events. APCO welcomed an FCC proposal to require reporting of partial 911 outages, but the telcos voiced concern. State regulators generally supported the FCC proposal to share database outage information with states.

Advanced Digital Broadcast, the Swiss-based supplier of HD set-top boxes, residential gateway devices and other products to pay-TV operators worldwide, is seeking a preliminary injunction preventing HDMI Licensing from canceling its license agreement and preventing customs authorities from seizing ADB goods, the company said in a motion filed in U.S. District Court in San Jose. ADB wants the court to set an Aug. 12 motions hearing on the injunction request. ADB moved for the injunction days after its complaint accused HDMI Licensing of “wrongfully” demanding $905,000 in back royalties it doesn’t owe (see 1507010017). The complaint didn’t seek a preliminary injunction, only a court “declaration” that HDMI Licensing “is precluded” from notifying customs that ADB goods “are unauthorized and subject to seizure because they are not.” ADB has argued it has dutifully paid HDMI Licensing the 4 cent-per-unit royalty it owed, but that the licensor is wrongfully demanding 10 cents per unit more on the grounds -- denied by ADB -- that ADB failed to “reasonably” incorporate HDMI trademarks on its product documentation materials. If HDMI Licensing isn't “enjoined” from canceling the license agreement and calling for customs seizures of ADB shipments, ADB “will suffer immediate irreparable harm as it will no longer be able to represent to its customers that it supplies licensed products,” its injunction motion said. “The inability to do so will severely harm the reputation of ADB and the goodwill it has established in the U.S. market and its industry worldwide.” ADB also fears the jobs of its 50 U.S. employees will be “at risk,” it said. HDMI Licensing representatives have declined comment on the case.

HDMI Licensing “wrongfully” demands $905,000-plus in back royalties and interest from Advanced Digital Broadcast, a Swiss-based supplier of HD set-top boxes, residential gateway devices and other products to pay-TV operators, ADB alleged in a breach of contract complaint filed Tuesday in U.S. District Court in San Jose. ADB seeks a declaratory ruling that it doesn’t owe the money. HDMI Licensing threatened to cancel ADB’s license agreement at the close of business Tuesday and alert customs authorities globally to seize ADB shipments as “unauthorized” goods, the complaint said. The complaint doesn’t seek a preliminary injunction, only a “declaration” that HDMI Licensing “is precluded” from notifying customs that ADB goods “are unauthorized and subject to seizure because they are not.” Neither side commented Wednesday. Under its November 2005 HDMI license agreement, ADB dutifully paid the 4 cents per unit royalty it owed for every licensed “end-user cable, component, connector, repeater, source or sink” it shipped between January 2010 and December 2012, the complaint said. An independent HDMI Licensing auditor found in late 2014 -- incorrectly, ADB alleged -- that ADB failed to “reasonably incorporate” the HDMI trademarks into the product documentation materials that accompanied those shipments, the complaint said. That failure gives HDMI Licensing the authority to charge an additional 10 cents per unit royalty, and it’s that differential royalty that ADB said it doesn’t owe. "Solely in an effort to resolve the dispute," ADB "changed the way it reasonably incorporates the HDMI alleged trademark into its related materials,” the complaint said. “ADB licensed products implement any and all changes in marking” that HDMI Licensing suggested, yet the licensor won't relent, it said.

The use of a promotional model for demos doesn't constitute a "permissible use" under drawback rules permitting refunds of customs duties for unused goods, Customs and Border Protection ruled. CBP said in the just-released May 28 ruling, HQ H258306, that demos of Anritsu network testing devices before sale go beyond incidental usage and don't qualify as unused merchandise. Anritsu is a Japanese manufacturer of network test and measurement equipment for the telecom industry. The company's U.S. sales personnel generates interest in Anritsu products through the use of promotional models imported into America. The company lets potential customers test the models, either through letting the prospect take a device home or within a lab setting, said CBP.

The FCC is considering placing an IP technology transition item on the preliminary agenda due out Thursday for the commission's July 16 open meeting, those following the proceeding told us Monday. The item, which grew out of a November rulemaking notice, is intended to provide a regulatory framework as telecom carriers migrate from traditional circuit-switched, copper-based phone networks and services to packet-switched IP-based services using fiber, coaxial cable, copper and wireless networks.

In adopting a Lifeline USF order Thursday, the FCC backed off a staff proposal to increase the general record-retention requirements of Lifeline USF providers from three to 10 years, agency officials said the next day. But the commission in a 3-2 vote (see 1506180029) adopted new rules requiring providers to retain customer eligibility documentation. In a VoIP numbering order also adopted Thursday, the FCC didn't adopt Level 3 proposals to firm up CLEC access charge rights when VoIP providers gain direct access to phone numbers, agency officials said. The FCC staff and Level 3 proposals drew objections from the regional Bells in the days before the vote.

The FCC proposed fining AT&T Mobility $100 million for allegedly throttling the speed of data connections of subscribers with unlimited data plans who exceeded 5 GB of use per month, without warning and without disclosing what it was doing, the agency said Wednesday. Customers who tripped the cap saw data transmission rates throttled for an average of 12 days per billing cycle, FCC officials said. The proposed fine in the notice of apparent liability (NAL) is the largest in FCC history, the commission said. It's the first time a company has faced FCC allegations it violated the transparency provisions of the agency’s 2010 net neutrality rules. The transparency provisions were the one part of those rules that survived Verizon’s challenge to the original order. The agency's Republican members dissented, and some foes of net neutrality rules cried foul.

FCC items moving Lifeline USF toward broadband coverage and authorizing VoIP numbering direct access appear likely to be approved Thursday, despite some continuing controversies and even resistance, agency and telecom industry officials told us. The VoIP numbering item is a "slam dunk 5-0 [vote]," said an agency official, but questions remain about whether Lifeline will draw dissent. Signaling different points of emphasis, Commissioner Mignon Clyburn said Wednesday it was time to "reboot" the Lifeline program for this century, while Commissioner Ajit Pai said the FCC needed to focus on establishing a Lifeline budget and reining in abuses if it's going to authorize broadband support.

The regional Bells and USTelecom criticized a Granite Telecom petition asking the FCC to give competitive LECs access to Bell combinations of unbundled network elements (UNE) and wholesale services under Section 271 of the Communications Act. The ILEC parties said Granite was seeking to re-create a discarded wholesale platform when the commission should be focused on giving incumbents more relief from outdated wholesale duties. Competitors supported Granite's petition, with Comptel calling Section 271 a "critical regulatory backstop" for CLECs negotiating wholesale access to Bell networks, in comments this week in response to a public notice in docket 15-114 (see 1505180032).