The U.S. Supreme Court’s decision to grant certiorari earlier this month in a case from the 9th U.S. Circuit Court of Appeals, McLaughlin Chiropractic Associates v. McKesson, could have implications beyond the FCC’s legal interpretation of the Telephone Consumer Protection Act, legal experts told us. SCOTUS began its current term Oct. 7.
The U.S. Supreme Court will take up early in its new term whether reimbursement requests submitted to the Universal Service Administrative Co.-administered E-rate program are “claims” under the False Claims Act (FCA). On Nov. 4, justices will hear Wisconsin Bell v. U.S., a case from the 7th U.S. Circuit Appeals Court (see 2405220039).
FCC Commissioner Brendan Carr and former Federal Election Commission Chairman Bradley Smith disagreed with Public Knowledge CEO Chris Lewis Monday about the FCC’s authority to require disclosures on political ads created with generative AI. During a Federalist Society virtual discussion, Carr and Smith said the FCC was stepping onto the FEC’s turf and going beyond the intent of statutes giving the agency regulatory power on political ads. However, Lewis said the FCC effort would be complementary to FEC rules. “If we don't have these rules, it is critically important that those who are critical of them come up with solutions to solve this threat,” Lewis said.
The FCC lacks legal authority to impose handset unlocking rules on carriers and hasn’t done the economic work needed to justify a proposed 60-day unlocking mandate, the Phoenix Center said in reply comments about an NPRM commissioners approved 5-0 in July (see 2407180037). Republican attorneys general from five states said a mandate would be “a significant federal agency overreach.”
Legislators, broadcasters, cable groups, the Heritage Foundation and civil rights groups disagree on whether the FCC can or should require disclosures for political ads created with generative AI, according to comments filed in docket 24-211 by Thursday’s deadline.
The FCC “clearly lacks authority” to assign the 4.9 GHz band to the FirstNet Authority and FirstNet “clearly lacks authority to receive it,” the Coalition for Emergency Response and Critical Infrastructure (CERCI) said in a filing posted Friday in docket 07-100. Coalition representatives met with aides to FCC Commissioners Brendan Carr, Geoffrey Starks and Nathan Simington about concerns with a Public Safety Spectrum Alliance (PSSA) proposal that would give FirstNet control of the band. “PSSA’s and AT&T’s alternative proposal that the Commission effect this unlawful assignment indirectly through a forced sharing agreement with a Band Manager does not solve the problem,” CERCI said: “The PSSA and its allies do not cite a clear congressional grant of authority for this proposal.” CERCI cited the U.S. Supreme Court’s recent decision in Loper Bright Enterprises v. Raimondo, which “makes clear that agency interpretations of statutes … are not entitled to deference.”
In a dissent attached to a combined $3.6 million forfeiture against Sinclair Broadcast and others over kidvid violations, FCC Commissioner Nathan Simington has vowed he will dissent from monetary forfeitures until the agency “formally determines the bounds of its enforcement authority.” Simington's move comes in the wake of the recent U.S. Supreme Court decision SEC v. Jarkesy. The order was approved 3-2, with Commissioner Brendan Carr also dissenting. The forfeiture order was adopted Aug.14, but not released until Thursday. The FCC didn't immediately comment on the delay. “I call on the Commission to open a Notice of Inquiry to determine the new constitutional contours of Commission enforcement authority,” Simington wrote. “The statutory structure governing the FCC’s forfeiture power is quite different from that of the SEC,” the FCC said in a footnote in the order, arguing that the agency’s enforcement actions don’t violate the Seventh Amendment right to a jury trial as SCOTUS ruled the SEC’s do.
The Congressional Research Service predicts the U.S. Supreme Court’s June Loper Bright Enterprises v. Raimondo ruling (see 2406280043) and “uncertainty about the scope of the FCC’s authority and ability to adopt regulations in the public interest” could prompt congressional legislation "to clarify the agency’s statutory authority.” Conversely, lawmakers could also maintain “the status quo and let ambiguities regarding the FCC’s rulemaking authority be resolved by the courts,” CRS said in a Wednesday report. “There are also questions on whether the FCC may alter its rulemaking efforts in response to Loper Bright, as well as how such alterations might affect interest in legislation.” The FCC’s July FCC order that lets schools and libraries obtain E-rate support for off-premises Wi-Fi hot spots and wireless internet services (see 2407180024), April net neutrality rules and a 2023 digital discrimination order “illustrate the types of rules that might be challenged as exceeding FCC authority under Loper Bright or the major questions doctrine,” researchers said. Maurine and Matthew Molak petitioned the 5th U.S. Circuit Court of Appeals last week to review the E-rate Wi-Fi order (see 2408300027). The Molaks, whose 16-year-old son died by suicide after he was cyberbullied, say that ruling would give children and teenagers unsupervised social media access. Numerous FCC rules even before Loper Bright "were being contested by affected parties, including” the 5G Fund and next-generation 911 transition, “in both of which the FCC cites its public interest mandate,” CRS said. Researchers also noted the FCC’s 2022 notice of inquiry about ways to aid nascent in-space servicing, assembly and manufacturing companies (see 2208050023) “has come under scrutiny from interested parties.”
The FCC should reverse course on its proposed $150,000 penalty against Mission Broadcasting (see 2401120069) in light of recent U.S. Supreme Court decisions on agency enforcement and Chevron deference, Mission said in a supplemental filing posted Tuesday in docket 22-443. The proposed penalty is from a January notice of apparent liability over accusations from Comcast that Mission violated the FCC’s rules on good faith retransmission consent negotiation by allowing Nexstar -- which operates all of Mission’s stations – to negotiate on Mission’s behalf for WPIX New York. “Just as courts should no longer defer to agency interpretations of statutes, neither should they defer to agency interpretations of regulation” after SCOTUS’ Loper Bright v. Raimondo decision, Mission said. The FCC’s NAL is based on “irrational interpretations” of FCC rules and precedent and the agency hasn’t shown that Mission’s violations were willful and continuous, Mission said. “Common sense demands that the presentation of a contract proposal is a ‘discrete act,’ not a continuing violation, and the NAL’s contrary reading of the statutory term is inconsistent with FCC and judicial precedent,” Mission said. Under the high court’s SEC v. Jarkesy ruling, the FCC’s proposed forfeiture would violate the Seventh Amendment right to a jury trial, Mission said. Jarkesy “confirms that the FCC’s enforcement regime suffers from constitutional deficiencies,” Mission said. Attorneys have widely predicted that the Loper Bright and Jarkesy decisions will be raised in nearly every FCC enforcement proceeding going forward (see 2407250030). Mission and Nexstar are also facing a second, $1.8 million NAL connected with Mission’s operation of WPIX (see 2403220067).
The ultimate makeup of the 6th U.S. Circuit Court of Appeals panel that hears the review of the FCC’s net neutrality order may not make much difference, some legal experts told us, in the wake of recent U.S. Supreme Court decisions. They doubted that the panel (docket 24-7000) will delve deeply into case law, instead simply deciding that going forward it's Congress, not the FCC, that must address any case that raises "major questions." Oral argument is scheduled for Oct. 31.