Supreme Court to Hear Free Speech Case Involving Autodialer Exemption

On January 10, the Supreme Court issued an order granting review in Barr v. American Association of Political Consultants. The case involves the Telephone Consumer Protection Act (TCPA), and it presents the issue of whether the government debt-collection exemption to the "autodialer" provision violates the First Amendment's Freedom of Speech Clause.

Previously, the U.S. Court of Appeals for the Fourth Circuit struck down the TCPA's carve out for government debt collection on First Amendment free speech grounds. The Fourth Circuit determined that the TCPA's government debt-collection exemption amounts to a content-based restriction of speech. It further determined that exemption was not narrowly tailored to further a compelling governmental interest but "fatally underinclusive": "First, by authorizing many of the intrusive calls that the automated call ban was enacted to prohibit, the debt-collection exemption subverts the privacy protections underlying the ban. Second, the impact of the exemption deviates from the purpose of the automated call ban and, as such, it is an outlier among the other statutory exemptions." According to the Fourth Circuit: "The exemption thus
 cannot be said to advance the purpose of privacy protection, in that it actually authorizes a broad swath of intrusive calls. In so doing, the debt-collection exemption exposes millions of American consumers to some of the most disruptive phone calls they receive."

In Bar v. AAPC, the Supreme Court will have the final word on the TCPA exemption's constitutionality. Clearly, Barr v. AAPC has important First Amendment implications. But the Supreme Court's forthcoming ruling will not likely touch on pressing legal uncertainty problems involving other aspects of the TCPA that Free State Foundation President Randolph May and I have addressed in prior Perspectives from FSF Scholars papers (available here and here).

We recommend that the FCC ought to adopt rules to clarify the definition of an "autodialer" under the TCPA. In particular, the Commission should clarify that consumers don't become "autodialers" merely by placing a single call or text from a saved number in their smartphones. Clarifying rules of that sort are not content-based speech restrictions and can thus be adopted consistent with First Amendment free speech precedents. 

Homeland Security to Step Up Efforts Against Counterfeit and Pirated Goods

On January 24, the U.S. Department of Homeland Security released "Combatting Trafficking in Counterfeit Goods," a report to the President of the United States. The report lays out a series of actions that federal law enforcement agencies plan to take in order to combat the growing problem of trafficking in copyright-infringing goods as well as other counterfeit or pirated products.

Over the last several years, international trafficking in counterfeit and pirated goods – including infringing copies of copyrighted works – has increased. The report cites OECD figures indicating an increase in internationally traded counterfeits from $200 billion in 2005 to $509 billion in 2016, a 154% increase. As the report observes: "E-Commerce…facilitates the widespread sale of pirated versions of copyrighted works. Pirated medical books — which can contain errors that endanger patients’ lives — have been found on platforms along with other pirated books (textbooks and trade books) and illicit reproductions of music-CD box sets."

The purpose of DHS's report is "to develop a deeper understanding of how e-commerce platforms, online third-party marketplaces, and other third-party intermediaries facilitate the importation and sale of massive amounts of counterfeit and pirated goods." The report points out: "[R]ights holders are often burdened by e-commerce platforms that operate third-party marketplaces with a disproportionate share of the costs of monitoring, detection, and enforcement falling on rights holders. This burden falls heavily on smaller American enterprises that cannot spread the costs due to trademark infringements and brand enforcement over large sales and inventories." 

The report sets forth several enforcement-related actions that the U.S. Customs and Border Protection and the U.S. Immigration and Customs Enforcement agencies intend to take to curb the trafficking of counterfeited pirated goods into the U.S. Significantly, the report identifies application of civil fines, penalties, and injunctive actions for imports of counterfeit and pirated products. According to the report:

• CBP and ICE will immediately begin to identify cases in which third-party intermediaries have demonstrably directed, assisted financially, or aided and abetted the importation of counterfeit merchandise. In coordination with the Department of Justice, CBP and ICE will seek all available statutory authorities to pursue civil fines and other penalties against these entities, including remedies under 19 U.S.C. § 1526(f), as appropriate. 

• DHS recommends the administration pursue a statutory change to explicitly permit the government to seek injunctive relief against third-party marketplaces and other intermediaries dealing in counterfeit merchandise. 

• In the interim, DHS will provide information and support to registered brand owners looking to utilize statutory authorities to seek injunctive relief against persons dealing in counterfeit merchandise, whether through direct sales or facilitation of sales, following seizures of goods that are imported contrary to law. 

• ICE shall prioritize investigations into intellectual property-based crimes regardless of size and will make referrals for all such investigations where appropriate. 

• ICE will coordinate with the Department of Justice to develop a strategy to investigate and prosecute intellectual property violations at all levels of the supply chain at a sufficiently high level to respond to the concerns raised in this report and according to its budget and broader mission goals. 

The DHS report's action items and recommendations appear sensible and hopefully will help reduce trafficking in copyright-infringing goods as well as other counterfeit and pirated products. Free State Foundation President Randolph May and I have previously recommend that foreign trade agreements and treaties negotiated by the U.S. include language requiring foreign nations to improve their interdiction efforts and prosecutorial resources to stop the international flow of infringing goods and other illicit products. 

Copyright and AI

Both real-world advances and outright speculations about artificial intelligence (AI) technologies have prompted scholars, policymakers, and others to ponder the implications of AI for copyright law and policy. The Copyright Office is hosting a symposium on "Copyright in the Age of Artificial Intelligence" on February 5 at the Library of Congress. And in 2019, the U.S. Patent and Trademark Office requested public comments on the impact of AI on copyrights and other forms of intellectual property (IP). Among the comments filed in response to the USPTO's request, the Motion Picture Association (MPA) offered a common sense take on the durability of basic copyright principles and the importance of maintaining clear rules regarding ownership and liability for infringement.

We may have more to say on AI and copyright the future. However, Free State Foundation President Randolph May and I have made the case – in Perspectives from FSF Scholars papers published in September 2019 and here in January 2020 – that copyright infringement is a strict liability tort and that an online platform provider's use of an automatic process in causing an infringement does not shield such providers from liability. 

Senate Passes the USMCA

On January 16, the U.S. Senate passed H.R. 5430, the United States-Mexico-Canada Agreement Implementation Act. The Senate deserves credit for promptly approving the USMCA following its passage in the House of Representatives in December 2019. The USMCA includes several provisions that will help strengthen Americans' copyrights in those neighboring nations. H.R. 5430 has been transmitted to President Trump for signature. 

Free State Foundation President Randolph May and I described the pro-copyright provisions contained in the USMCA and recommended its passage. My April 2019 Perspectives from FSF Scholarspaper, "Trade Agreements Should Include Stronger Online Copyright Protections" and my similarly-titled October 2019 Perspectivespaper, "Trade Agreements Should Strengthen Copyright Protections Against Piracy" also discussed the USMCA's pro-copyright features.

Keynote Speakers Announced for FSF's Twelfth Annual Conference

The Free State Foundation will hold its Twelfth Annual Telecom Policy Conference on Tuesday, March 10, 2020, at the National Press Club in Washington, DC. The Conference theme for this year is "Broadband Beyond 2020: Competition, Freedom, and Privacy." Five keynote speakers for the conference have been announced:

U.S. Deputy Attorney General Jeffrey Rosen

FCC Chairman Ajit Pai

FCC Commissioner Michael O'Rielly

FCC Commissioner Brendan Carr

FTC Commissioner Christine Wilson

REGISTRATION IS COMPLIMENTARY, INCLUDING CONTINENTAL BREAKFAST AND LUNCH. BUT YOU MUST REGISTER TO ATTEND.

REGISTER NOW HERE!

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Pending Case Could Prompt the Supreme Court to Reconsider Brand X

On January 8, 2020, the Federalist Society's Practice Group Podcast featured a teleforum on Baldwin v. U.S. – now pending at the certiorari stage at the U.S. Supreme Court – and on the future of the Court's decision in NCTA v. Brand X Services, Inc. (2005). The call included an incisive critique of Brand X from constitutional and administrative law standpoints. Brand X is a progeny of Chevron U.S.A. v. Natural Resources Defense Council (1984). The call's participants discussed the relationship between Brand X deference and Chevron deference as well as conceptual distinctions between them. 

FSF President Randolph May has written numerous publications going back several years addressingChevron, Brand X, and related decisions involving judicial deference to agency decisions. Here are just a few of his more recent publications:

• Randolph J. May, "The Ongoing Saga of Chevron and Net Neutrality," Perspectives from FSF Scholars, Vol. 14, No. 33 (Oct. 21, 2019);

• Randolph J. May, "Delegation, Deference, and the FCC," FSF Blog (Jul. 12, 2019);

• Randolph J. May, "Judge Brett Kavanaugh's Views on Chevron Deference at the FCC and Beyond," Perspectives from FSF Scholars, Vol. 13, No. 32 (Aug. 6, 2018);

• Randolph J. May "Notes for NARUC," FSF Blog (Jul. 21, 2016); and

• Randolph J. May, "Chevron Decision's Domain May Be Shrinking,"Perspectives from FSF Scholars, Vol. 10, No. 23 (Jul. 7, 2015).

Proposed Maryland Tax on Digital Advertising Is Problematical

As the Maryland General Assembly gets geared up for its 2020 legislative session, a bill has been introduced by the current and former Senate majority leaders to tax online ad revenues. The sponsors say that such a digital advertising tax could raise $100 million a year.

It's true that Maryland's fiscal situation could use shoring up to reduce the perennial "structural deficit" that characterizes Maryland budget. But the proposed digital advertising tax is problematical for several reasons relating to sound tax policy.

For a good discussion, see this piece by the Tax Foundation's Ulrik Boesen.

We'll likely have more to say about this as the legislative session progresses.  

U.S. Delegation Members Highlight U.S. Gains for 5G at International Conference

On January 7, 2020, the Federalist Society's Practice Group Podcast featured a teleforum discussion on "The Race to 5G and the World Radio Conference." The panel included Ambassador Grace Koh, who led the U.S. delegation to WRC-19, as well as the FCC's International Bureau Chief Thomas Sullivan. WRC-19 was held in Egypt and concluded its work in November 2019. The panelists offered interesting analysis of what was accomplished at WRC-19 regarding mobile wireless services, particularly regarding the use of mmWave spectrum for 5G services. Panel discussion also touched on U.S. cooperative efforts with regional partner nations, the 24 GHz band, and the postures of China and Russia at WRC-19. The podcast's page can be found here.

Free State Foundation scholars, including FSF President Randolph May, Visiting Senior Fellow Gregory Vogt, and myself have addressed 5G in a number of writings. Expect more from FSF scholars on 5G in 2020, including at the Free State Foundation's Twelfth Annual Telecom Policy Conference. This year's conference, Broadband Beyond 2020: Competition, Freedom, and Privacy, will be held at the National Press Club in Washington, DC on March 10. Register for the conference here.

My June 2019 blog post, "U.S. Policymaker Should Stick to Their 24 GHz Spectrum Band Plan," addressed disagreement among certain federal agencies regarding the use of that recently-auctioned spectrum. Importantly, the panelists on the Federalist Society's January 7 teleforum acknowledged that the U.S. delegation had achieved a united front on the 24 GHz band when it arrived in Egypt for the WRC-19. 

MPA on USMCA: Facilitates Growth

The statement below from Charles Rivkin, the head of the Motion Picture Association, is important, and especially for what it says about the size of the exports by US film, television, and streaming businesses. $17.2 billion annually is a lot of money that translates into a lot of jobs. I can't vouch for the number, but assuming as I do that it is fairly accurate, the case for taking actions to reduce piracy is self-evident! 

FOR IMMEDIATE RELEASEJanuary 16, 2020

Statement from Charles Rivkin on USMCA Passage in the Senate     

WASHINGTON  -- The United States Senate today passed the United States-Mexico-Canada Agreement (USMCA). The trade bill now heads to the President’s desk for signature.

The following is a statement from Motion Picture Association Chairman and CEO Charles Rivkin:

“The Motion Picture Association applauds the Senate for passing the USMCA today. Currently, the U.S. film, television, and streaming content industry accounts for $17.2 billion annually in exports and registers a positive trade balance with nearly every country in the world. The USMCA will help the future of our industry look brighter, particularly in Mexico. This deal includes provisions that facilitate the growth of the legal, digital market for creative content while improving tools to address the threat of online piracy, which costs the industry up to $71 billion of revenue lost annually. Future trade deals should account for the constantly changing digital landscape, and we look forward to working with the Administration to build on USMCA and further improve protections for our creative economy. I would like to thank the President, Ambassador Lighthizer, Leader McConnell and Speaker Pelosi for their leadership for passing this important trade agreement.”

Bipartisan Efforts Toward Resolution on Net Neutrality Deserves Support

The debate over net neutrality regulation is certain to continue this year, and it's also certain to be a topic for discussion at the Free State Foundation's Twelfth Annual Telecom Policy Conference – Broadband Beyond 2020: Competition, Freedom, and Privacy. (Register here for the conference, to be held March 10 in Washington DC.) 

As last year drew to a close, Senators Roger Wicker and Krysten Sinema co-authored a December 23, 2019 op-ed in the USA Today highlighting their continuing efforts to seek a congressional compromise that will protect consumers and provide clear rules regarding broadband Internet service providers' (ISPs) network management practices. The Senators' op-ed contains the practical title: "We need to prepare for internet of the future. Here's how Congress can help." Senators Wicker and Sinema offer a reasonable outlook and hope for a legislative resolution on net neutrality and Internet freedom. Many of their basic points were anticipated by former Congressman Rick Boucher back in 2015, when he addressed the need for a legislative compromise on net neutrality and Internet freedom at FSF's Seventh Annual Conference. 

Right now, congressional resolution of this matter in 2020 may appear to be a long shot. But there is nothing to lose by engaging in discussions, and persistence may even lead to a breakthrough. Congress, industry, public interest groups, activists, consumers, and others ought to recommit to forging a new framework for addressing ISP network management practices.  

Registration Open for FSF's Twelfth Annual Telecom Policy Conference

The Free State Foundation will hold its Twelfth Annual Telecom Policy Conference on Tuesday, March 10, 2020, at the National Press Club in Washington, DC. This annual conference is widely acknowledged to be one of the nation's premier communications law and policy events. Registration is now open.

The title for this year's conference is Broadband Beyond 2020: Competition, Freedom, and Privacy.

This is the guarantee: As in previous years, a truly outstanding lineup of senior officials and prominent experts from the FCC, other government agencies, industry, academia, and think tanks will discuss and debate the most important communications and Internet policy issues of the day, including Internet freedom and net neutrality, broadband deployment, competition policy, the 5G rollout, privacy regulation, the changing video services landscape and regulatory environment, universal service, and more.

REGISTRATION IS COMPLIMENTARY, INCLUDING CONTINENTAL BREAKFAST AND LUNCH. BUT YOU MUST REGISTER TO ATTEND.

REGISTER NOW HERE!

#FSFConf 12

Moving WiFi Forward in the 6 GHz Band

On January 3, the Wi-Fi Alliance ("WifiForward") introduced Wi-Fi 6E, a new term to identify Wi-Fi 6 products that can operate in the 6 GHz band. Here is WifiForward's statement announcing the introduction:

“Today, unlicensed spectrum stands out as one of the FCC’s most successful policy experiments ever. By allowing permissionless innovation in a band of spectrum, we’ve seen billions of dollars of economic value created, millions of people and devices connected and terabytes of critical data sent via technology like Wi-Fi. Today’s announcement by Wi-Fi Alliance shows that industry is ready to unleash even more innovation in the 6 GHz band, as soon as the FCC can make it available for technologies like Wi-Fi.”

After issuance of the WifiForward statement, FCC Commissioner Michael O'Rielly tweeted:

Must conclude @FCC proceeding ASAP, including parameters to protect incumbents, getting multiple unlicensed layers (LPI, VLP, & AFC-needing) into innovators' hands. Unlicensed in 6 GHz will be transformative!

I agree with Commissioner O'Rielly. It's important for the FCC to move forward with the 6 GHz proceeding with dispatch.

Consumers Receive High Volumes of Spam Calls, Low Volumes of Spam Texts

Americans are inundated with high numbers of unwanted robocalls, but they receive much lower numbers of unwanted text messages. A survey released in December by Zipwhip, a leading provider of text messaging solutions for businesses, shows that whereas 51% of respondents "often" receive spam over the phone, only 18% "often" receive spam texts. 

The survey findings reaffirm the importance of the Commission's Title I non-regulatory policy for texting. Given the freedom and flexibility to implement solutions, text messaging service providers – not Title II public utility-like restrictions – have successfully curbed unwanted messages. Those providers should remain free to pursue innovative solutions to maintain quality of service. 

According Zipwhip's survey, about 51% responded that they receive spam "often" over the phone and 83% receive spam at least "somewhat often" over the phone. Furthermore, 70% receive spam "often" over email and 92% receive email spam at least "somewhat often." However: "Only 18% of respondents said they get text spam 'often' and only 17% said they receive scam attempts 'often.' Most said they 'rarely' receive these types of messages (41% and 40% for spam and scam, respectively)." Illegal scam rates also are notably higher for voice calls and emails than for texts.

Importantly, the Zipwhip survey figures regarding low rates of unwanted texts vindicates the FCC's determination in its Wireless Messaging Service Order (2018) that text messaging services are lightly- or non-regulated "information services" under Title I of the Communications Act. That determination was amply supported, first and foremost, by the fact that wireless text messaging service capabilities fit the statutory definition of "information services." But the Commission also justified its Title I classification of wireless text messaging services with the compelling policy rationale that entrepreneurial innovation protects subscribers from spam and unwanted texts better than the strictures of public utility regulation. The 2018 Order stated: "In the absence of a Commission assertion of Title II regulation, wireless providers have employed effective methods to protect consumers from unwanted messages and thereby make wireless messaging a trusted and reliable form of communication for millions of Americans." Survey findings of markedly lower rates of unwanted communications via text messaging compared to other media platforms indicate that, a year after the 2018 Order, the policy for non-regulation of texting is succeeding in protecting consumers.

Zipwhip survey figures regarding the high rates of robocalls and emails are consistent with other reports. According to YouMail's Robocall Index, about 58.5 billion robocalls were sent nationwide in 2019. A YouMail analysis found that while about 27% of robocalls provided consumers with important alerts or reminders for things such as a school closure or doctor's appointment, the remaining 73% of robocalls are unwanted or spam. And about 25% of robocalls are illegal scams. It is elsewhere estimated that spam constituted around 55% of global email traffic in 2019. 

The problem of unwanted robocalls and the closely related problem of caller ID spoofing prompted Congress to pass the TRACED Act, which President Trump signed into law on December 31, 2019. Under the TRACED Act, voice service providers are required to make available to consumers – free of charge – technologies to authenticate calls and block robocalls. The Act extends the statute of limitation and increases fines for making unwanted robocalls. Additionally, the Act directs the FCC to undertake rulemakings to further ensure subscribers are protected from one-ring scams as well as other unwanted calls or texts. 

In its implementation of the TRACED Act, the Commission should rightly take aim at the sky-high number of scam calls as well as other unwanted robocalls. And it should exercise its oversight authority over voice service providers to ensure consumers are protected. At the same time, it is imperative that the Commission adhere to its Title I policy for text messaging, which has an established track record in protecting consumers. 

Another Muni Broadband System Bails Out

Often new municipal broadband systems receive much attention, including, of course, by advocates of government-owned broadband networks. A considerable number of the muni systems end up in financial difficulty -- and the cities and towns exit the business.

One of the latest examples of such "privatization" is the muni network owned by the North Carolina towns of Mooresville and Davidson. They sold all their communications assets to Telephone and Data Systems, Inc. (TDS).  Read all about it here.

President Trump Signed the TRACED Act

On December 30, 2019, President Donald Trump signed the TRACED Act into law. As highlighted in my post from December 13, the TRACED Act directs a number of federal agency actions toward combatting unwanted robocalls as well as ID spoofing. The President and the 116th Congress deserve credit for addressing those important consumer protection issues. Now it's up to the FCC and other agencies to begin implementing the law and hopefully help reduce substantially the illegal scams and other unwanted being calls made to American consumers.