Draft FCC Reauthorization Bill Suggests Overhauling Penalty Process

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By Lydia Beyoud

June 8 — A draft bill from the Senate Commerce Committee to reauthorize the FCC proposes changes to how the agency can impose penalties on companies, seemingly taking aim at action taken under delegated authority as opposed to commission approval, according to a copy obtained June 8 by Bloomberg BNA.

The draft differs from draft Federal Communications Commission reauthorization legislation circulated by the House Energy and Commerce Communications and Technology Subcommittee on March 17.

Notably, the Senate draft would require that each commissioner is notified of a private notice of apparent liability (NAL) sent to a company, and that each commissioner is notified of the company's written response to the notice and has access to the response for at least 15 days before the matter is made public.

The draft bill also contains bracketed text related to obtaining judicial review of the NAL. “What is not entirely clear is the intent behind that language, assuming it were included in the final draft,” Peter Karanjia, a former FCC deputy general counsel, told Bloomberg BNA.

The text may suggest “an intent to relieve parties subject to forfeiture orders of the commonly understood condition, at least in the D.C. Circuit, that they first pay the forfeiture before challenging it in the D.C. Circuit or other federal court of appeals,” said Karanjia, now a partner with Davis Wright Tremaine LLP in Washington.

A telecommunications industry lobbyist told Bloomberg BNA that allowing entities to appeal NALs without paying does appear to be the intent of that provision.

Many members of the industries overseen by the FCC have voiced concern in recent months over record-breaking fines and settlements levied by the FCC's Enforcement Bureau under the direction of Bureau Chief Travis LeBlanc, former special assistant attorney general of California.

LeBlanc has repeatedly said that he views large fines as a deterrent to others, and that consumer restitution is a leading factor in the multimillion-dollar fines brought under his leadership.

Collaboration Provision

The draft bill includes a provision already approved in the House to allow a bipartisan group of three or more FCC commissioners to meet privately to discuss agency business, so long as no votes or other actions are taken at the meetings.

The draft bill would require the disclosure of such meetings within two business days, including a list of attendees and summary of the matters discussed.

The full House Energy and Commerce Committee approved an FCC process-change bill (H.R. 2583) June 3 that included a similar provision. 

Thune Seeks Bipartisan Support

Senate Commerce, Science and Transportation Committee Chairman John Thune (R-S.D.) hopes to gain bipartisan support for the proposals in the 14-page draft, including that of ranking member Bill Nelson (D-Fla.), a committee aide confirmed to Bloomberg BNA.

Thune said he would like to “get Congress back in the habit of regularly reauthorizing the Commission” in January remarks at the free market American Enterprise Institute. “The last time Congress reauthorized the FCC was in 1990—the oldest expired authorization in the Commerce Committee’s jurisdiction,” he said at the event.

“As the ‘Staff Discussion Draft' label indicates, this is an incomplete and preliminary draft intended to gather input on a reauthorization of the Federal Communications Commission,” a Senate Commerce spokesman told Bloomberg BNA via e-mail. “The Commerce Committee continues to seek input on reauthorization from a wide range of voices.”

To contact the reporter on this story: Lydia Beyoud in Washington at lbeyoud@bna.com

To contact the editor responsible for this story: Heather Rothman at hrothman@bna.com

Text of the discussion draft is at http://op.bna.com/der.nsf/r?Open=sbay-9xaqa2.