Volume 68.2 Full issue

Editor’s Note

Article

Confusion, Uncertainty, and Fear: How the FCC’s Increased Reliance on Adjudication Is Harming Carriers, Competition, Consumers, and Investment
by Jonathan Marashlian, Jacqueline R. Hankins, Seth L. Williams, and Keenan P. Adamchak

In recent years, the Federal Communications Commission has increasingly relied on informal adjudications to craft industry-wide regulatory policies, arguably creating new regulations in the process. This trend is particularly noticeable in the context of the Universal Service Fund contribution duties imposed on both interstate and international communications service providers. By legislating through informal adjudication, the FCC created a litany of challenges for the industry it regulates, including increased uncertainty, fear, and a slew of competitive harms caused by inconsistent and shifting regulatory positions adopted in ad hoc adjudications. In addition, the courts, which should otherwise operate as a “check” on the scope of the FCC’s authority,  have increasingly become ineffective by dismissing appeals of agency adjudicatory decisions having industry-wide impact on standing and procedural grounds. This has effectively given the FCC unbridled authority to utilize the informal adjudicatory process in a manner that leaves many regulated entities with little opportunity to participate in the process. The FCC’s reliance on adjudications to move the regulatory goalposts is unmistakably manifested in the evolution of USF contribution policies.

This Article explores the phenomenon by tracing the slow, but steady erosion of the “contamination theory” from the Computer II  decision to Pulver.com, Brand X, InterCall, WebEx, and beyond. Recognizing the broad discretion enjoyed by the FCC in deciding whether to develop USF contribution policies via rulemaking or adjudication, this Article culminates in the conclusion that the industry and consumers it serves would greatly benefit from shifting the FCC’s current predisposition towards adjudications in favor of increased use of the rulemaking process. Whether through increased judicial oversight or the implementation of new policymaking procedures, change is long overdue. A shift back to rulemaking or, minimally, opening the courtroom doors to a larger swath of aggrieved parties, would serve the public interest by promoting transparency, predictability, and participation in the regulatory process.

Notes

Arrr! Sever Thee Transmitters! Making Radio Pirates Walk the Plank with Aiding and Abetting Liability
by Max Nacheman

Unauthorized radio broadcasting in violation of Section 301 of the Communications Act poses a unique and enduring enforcement challenge. While identifying the physical source of an unauthorized broadcast is possible, holding “radio pirates” accountable for illegal broadcasts has become difficult as technology enables pirates to transmit remotely and cheaply using off-the-shelf components, rendering pirates immune to prosecution. A new generation of unauthorized broadcasters is on the horizon, threatening America’s nascent advanced wireless networks. Rather than surrendering to the next wave of pirates, the Federal Communications Commission and the U.S. Department of Justice can outflank them by targeting enforcement efforts on enablers of pirate broadcasting. Secondary liability for aiders and abettors of Section 301 violations can be established in three ways: (1) Congress can pass a statute establishing liability for aiders and abettors of unauthorized broadcasting; (2) the FCC can use its rulemaking authority to adopt a similar rule; or (3) the DOJ can expose aiders and abettors to secondary liability under Title 18, by charging primary violators with “conversion of public property,” a criminal offense. Pirate radio broadcasters undermine the FCC’s authority and disrupt the regulatory scheme necessary for efficient management of scarce wireless spectrum. Imposing secondary liability on aiders and abettors will bolster the FCC’s enforcement authority and secure future efficient access to the regulated wireless spectrum for both broadcasters and consumers.

If It Isn’t Broken, You’re Not Looking Hard Enough: Net Neutrality and Its Impact on Minority Communities
by Sara Kamal

In making policy decisions, the Federal Communications Commission must consider the impact on the entire population, not just a majority of it. Many fail to consider all aspects of the net neutrality debate, especially the effect it has on minority communities. It is the unique struggles that these minority communities face in underrepresentation that makes FCC regulation of Internet service providers necessary.

Because they are faced with fewer opportunities and less financial means, minority communities are often underrepresented in the traditional media, and worse, they are often illustrated in stereotypically negative ways. Minorities have turned to the open Internet as a means to take back control to have an opportunity to tell their stories, and to reach out to their communities.

As the past has shown us, Internet service providers cannot be left to regulate their own actions. When given the opportunity in the cable network field, conglomerates like Comcast have taken over and left minority groups in the dark. Further, conglomerates providing financial support to the same minority groups they are hurting raises concerns and taints the public’s views in the process.

The courts have spoken: the FCC is within their authority to regulate Internet Service Providers as reclassified Title II common carriers. This leaves the decision entirely in the hands of the FCC and it is, without question, one of the most important the Commission has faced. It is time to protect the voices of the underrepresented.

What’s in Your Mobile Wallet? An Analysis of Trends in Mobile Payments and Regulation
by Carolyn Lowry

Mobile wallets have recently emerged as the latest development in the payments ecosystem. While these technology solutions are far from being universally used by consumers, use is growing rapidly. At the same time, the safety, soundness, and security of financial products like credit and debit cards are a concern of both consumers and businesses, particularly given the recent data breaches at several major companies. Mobile payments and their technological advances in the areas of tokenization and Near Field Communications (NFC) may lead to fewer fraudulent transactions and a decreased risk of large-scale data breaches.

This Note outlines the major issues surrounding mobile payments, starting with an overview of the different types of mobile payments as well as the existing regulations applicable to the payment sphere. The Note then goes on to analyze the application of existing regulations to new mobile payments technologies and concludes that current regulations are robust and sufficiently protect consumers from unauthorized and fraudulent transactions.