Today's FCC Ruling Will Not Stand

FCC chairman under investigation

BREAKING NEWS: The New York Times1 is reporting this morning that the FCC inspector general is actively investigating whether FCC Chairman Ajit Pai and his aides improperly pushed for rule changes that would clear the way for Sinclair's purchase of Tribune Media.

Pai is so sketchy that his own agency has launched an investigation against him. Demand that Chairman Pai recuse himself from reviewing the Sinclair merger now.

The right-wing Sinclair, which wants to buy Tribune Media, already owns more local-TV stations than any other company. The broadcaster and the Trump team had a cozy relationship throughout the campaign — and Jared Kushner even claimed that the campaign struck a deal for more favorable coverage.2 And Pai met with Sinclair executives three days before Trump appointed him to chair the FCC.3

Since his appointment as FCC chairman, Pai has worked overtime to clear the decks for Sinclair’s purchase of Tribune: He’s reduced the agency’s longstanding media-ownership limits and overturned rules that required broadcasters to maintain physical studios wherever they broadcast.

Conflict of interest, much?

Tell Chairman Pai to recuse himself from reviewing the Sinclair merger while the FCC investigation is underway.

Everything about the Sinclair-Tribune deal is offensive. Here we have a Trump appointee who’s dumping all consumer safeguards to enable Sinclair to reach more than 70 percent of the country with its racist views and Republican talking points.

And Sinclair isn’t an ordinary broadcast conglomerate. It overrides the objections of local journalists and forces its stations to run daily conservative commentaries and biased stories on the local news — including features from the “Terrorism Alert Desk,” which depicts all Muslims as terrorists.

If that weren’t enough, this deal is straight up against the law. It would violate a congressional mandate that says that one company can’t reach more than 39 percent of households nationwide.

With an active investigation of Pai underway, there’s no way he should be involved in reviewing this deal.

Demand that Pai recuse himself from decisions on the Sinclair merger.

If we can put enough pressure on the FCC, we just may be able to stop this deal.

https://www.nytimes.com/2018/02/15/technology/fcc-sinclair-ajit-pai.html

F.C.C. Watchdog Looks Into Changes That Benefited Sinclair

WASHINGTON — Last April, the chairman of the Federal Communications Commission, Ajit Pai, led the charge for his agency to approve rules allowing television broadcasters to greatly increase the number of stations they own. A few weeks later, Sinclair Broadcasting announced a blockbuster $3.9 billion deal to buy Tribune Media — a deal those new rules made possible.

By the end of the year, in a previously undisclosed move, the top internal watchdog for the F.C.C. opened an investigation into whether Mr. Pai and his aides had improperly pushed for the rule changes and whether they had timed them to benefit Sinclair, according to Representative Frank Pallone of New Jersey and two congressional aides.

“For months I have been trying to get to the bottom of the allegations about Chairman Pai’s relationship with Sinclair Broadcasting,” Mr. Pallone, the top Democrat on the committee that oversees the F.C.C., said in the statement to The New York Times. “I am grateful to the F.C.C.’s inspector general that he has decided to take up this important investigation.”

It was unclear the extent of the inspector general’s investigation or when it might conclude, but the inquiry puts a spotlight on Mr. Pai’s decisions and whether there had been coordination with the company. It may also force him to answer questions that he has so far avoided addressing in public.

The inquiry could also add ammunition to arguments against the Sinclair-Tribune deal. Public interest groups and Democratic lawmakers, including Mr. Pallone, are strongly opposed to the deal, arguing that it would reduce the number of voices in media and diminish coverage of local news.
Continue reading the main story
Related Coverage

Sinclair Unveils Tribune Deal, Raising Worries It Will Be Too Powerful MAY 8, 2017
How a Conservative TV Giant Is Ridding Itself of Regulation AUG. 14, 2017
F.C.C. to Loosen Rules on Local Media Ownership OCT. 25, 2017

Sinclair’s chief executive, Chris Ripley, has called Mr. Pai’s relaxation of media ownership rules a “landmark” development for his company and the industry. A union of Sinclair and Tribune would create the nation’s biggest television broadcaster, reaching seven out of 10 American homes. The F.C.C. and Justice Department are widely expected to approve the merger in the coming weeks.

The office of F.C.C. inspector general, which is a nonpartisan role that reports to the agency and regularly updates Congress on some investigations, said it would “not comment on the existence or the nonexistence of an investigation.”

Mr. Pai’s office and Sinclair declined to comment. When the legislators called for an investigation in November, a spokesman for the F.C.C., representing Mr. Pai, said the allegations of favoritism were “baseless.”

“For many years, Chairman Pai has called on the F.C.C. to update its media ownership regulations,” the F.C.C. spokesman said. “The chairman is sticking to his long-held views, and given the strong case for modernizing these rules, it’s not surprising that those who disagree with him would prefer to do whatever they can to distract from the merits of his proposals.”

A New York Times investigation published in August found that Mr. Pai and his staff members had met and corresponded with Sinclair executives several times. One meeting, with Sinclair’s executive chairman, took place days before Mr. Pai, who was appointed by President Trump, took over as F.C.C. chairman.

Sinclair’s top lobbyist, a former F.C.C. official, also communicated frequently with former agency colleagues and pushed for the relaxation of media ownership rules. And language the lobbyist used about loosening rules has tracked closely to analysis and language used by Mr. Pai in speeches favoring such changes.

Hawaii is the Latest State to Pass Net Neutrality Rules
by Karl Bode
Thursday Feb 08 2018 07:40 EST
https://www.dslreports.com/shownews/Hawaii-is-the-Latest-State-to-Pass-Net-Neutrality-Rules-141204

Hawaii is the fourth state to sign an executive order banning the state from doing business with ISPs that violate net neutrality. Hawaii Governor David Ige says the executive order updates state procurement policies to prohibit ISPs winning state contracts if they engage in anti-competitive throttling, paid prioritization, website blocking, or other bad behaviors. Like similar executive orders signed in New York, Montana and New Jersey, Hawaii's order carves out exceptions for "reasonable network management" like giving essential health services prioritization.

An open internet is critically important to our people and our economy, connecting us to the rest of the world, increasing our commerce, fostering innovation, and adding to our economic growth," Ige said in a statement. "I have worked with my cabinet members, members of the House, and other stakeholders to protect the integrity of this critical resource."

Hawaii is one of four states pursuing executive orders, while numerous additional states are considering net neutrality legislation. Large ISPs like Comcast have complained the efforts create a patchwork of inconsistent regulations it has to comply with, but large ISPs likely should have considered this more carefully before they lobbied to repeal arguably modest and very popular federal rules.

The FCC, at Comcast and Verizon lobbying behest, included pre-emption language in their net neutrality repeal that attempts to block states from protecting consumers. So not only will the FCC face a legal battle on that front, 23 states attorneys general are also suing the agency for ignoring the good of the public and rushing toward repeal.

The FCC also faces a law enforcement investigation into who engaged in fraud and identity theft during the open comment period, purportedly to try and downplay massive public opposition to the plan. The GAO is also investigating the FCC's role in both ignoring the fraudulent comments, in addition to the agency's claims of a seemingly fake DDOS during the proceeding.
That's all in addition to the numerous lawsuits that are being filed by competitors and consumer advocates. All of which could have been avoided if FCC boss Ajit Pai had simply listened to the public and left the arguably modest (by international standards) rules in place.

FCC Boss Turns Down His Gun Award From the NRA
by Karl Bode
Friday Mar 02 2018 14:00 EST

After likely consultation with agency lawyers, FCC boss Ajit Pai has turned down a gun gifted to him by the NRA for his extremely-unpopular attack on net neutrality. The agency boss received an old musket as part of a tone deaf award ceremony at the CPAC conference, where Pai also received the NRA's Charlton Heston "Courage Under Fire" Award for "courageously" selling the public out to telecom monopolies like Comcast, AT&T and Verizon. CPAC organizer Dan Schneider went so far as to call Pai "the most courageous, heroic person that I know" at a ceremony ripped out of the pages of The Onion.

But after former White House ethics lawyers pointed out that the gift would likely violate both ethics rules and lobbying laws, the agency head has wisely decided to turn down the prize.

"...Upon their counsel, I must respectfully decline the award,” Pai said in a leaked letter to the NRA. "I have also been advised by the FCC’s career ethics attorneys that I would not be able to accept the award upon my departure from government service."

Pai's already facing two different GAO inquiries into the identity theft, fraud, and other bizarre events that occurred (like dead people supporting the killing of net neutrality) during his agency's repeal of the rules. He's also facing a growing mountain of lawsuits by companies and consumer advocates who say he ignored the public and all objective data to repeal the rules. One of those suits involves nearly half the States in the union.

And he's most recently been the focus of a bipartisan investigation by the FCC Inspector General into whether the agency head specifically gutted media consolidation rules explicitly to benefit Sinclair Broadcasting's merger ambitions.
As such, Pai (or more accurately FCC lawyers) wisely concluded his plate was already overflowing in terms of scandal for the time being.

FCC Calls Net Neutrality Supporters 'Desperate'
by Karl Bode
Monday Dec 04 2017 18:37 EST

FCC boss Ajit Pai has called net neutrality supporters "desperate" after a coalition of 40 consumer groups penned a letter to the agency boss asking him to delay the agency's December 14 vote to kill net neutrality. A coalition of 40 consumer groups (alongside of representatives from New York City) penned a letter (pdf) to Pai urging the FCC to delay its vote until a landmark court case between AT&T and the FTC can be settled.

hat case would determine whether the FTC actually has the authority to effectively police anti-competitive behavior by the nation's biggest ISPs.

As we've long noted, the broadband industry's goal isn't just the elimination of net neutrality and broadband privacy rules that protect consumers, it's the wholesale elimination of FCC, FTC, and state oversight of some of the least liked, and least competitive companies in America. This goal has been stated time and time again by lobbyists for AT&T, Verizon and Comcast, and the lawmakers and regulators clearly beholden to their every whim.

History, unfortunately, has long shown how the one-two punch of regulatory apathy and limited competition doesn't end well for consumers.

One refrain from Ajit Pai and industry friends as they try to kill FCC oversight of large ISPs is that the FTC will step in and protect consumers.

But there's several flaws with that claim. One, unlike the FCC, the FTC lacks the rulemaking authority of the FCC, and can only respond to anti-competitive behavior long after they've actually occurred. The other problem is that the FTC is already under-funded, overburdened and incapable of truly policing yet another massive sector, something former FCC boss Tom Wheeler made clear in an interview earlier this year.

"It’s a fraud," Wheeler said when asked about the Trump administration's plan to "reform" the FCC. "The FTC doesn’t have rule-making authority. They’ve got enforcement authority and their enforcement authority is whether or not something is unfair or deceptive. And the FTC has to worry about everything from computer chips to bleach labeling. Of course, carriers want [telecom issues] to get lost in that morass. This was the strategy all along."

Somebody is killing all the baby sitters

And it gets worse. AT&T is currently in court trying to weaken FTC oversight of large ISPs even further. AT&T was sued by the FTC after the company lied about throttling its "unlimited" wireless data customers. Should the FTC lose that website, it recently noted that any company with a "common carrier" component to its business operations would be able to tap dance around the agency's authority.

"The panel’s ruling creates an enforcement gap that would leave no federal agency able to protect millions of consumers across the country from unfair or deceptive practices or obtain redress on their behalf," warned the FTC. "Many companies provide both common-carrier and non-common-carrier services -- not just telephone companies like AT&T, but also cable companies like Comcast, technology companies like Google, and energy companies like ExxonMobil."

The FTC proceeded to warn that should AT&T prevail in court, companies could just gobble up small common carrier business segments to dodge regulatory oversight.

"Companies that are not common carriers today may gain that status by offering new services or through corporate acquisitions," said the FTC. "For example, AOL and Yahoo, which are not common carriers, are (or soon will be) owned by Verizon. The panel’s ruling calls into question the FTC’s ability to protect consumers from unlawful practices by such companies in any of their lines of business."

If the goal really is to gut FCC oversight and shovel any remaining oversight to the FTC, the fact that AT&T may soon be able to tell the FTC to go to hell seems, well, important.

Desperate Times

All of this explained, consumer groups thought it might make sense for the FCC to delay its net neutrality killing vote, giving the courts time to determine whether or not the FTC could actually protect consumers like Ajit Pai and the broadband industry have claimed.

"Rushing to a vote before the Ninth Circuit resolves this decision cavalierly risks the purported safeguards that you and other supporters of the Draft Order have repeatedly declared will protect consumers from abusive or anti-competitive practices," the letter notes.

"Astoundingly, after committing the entire future of consumer protection from broadband access providers to the FTC, the Draft Order cavalierly dismisses the ongoing litigation that deprived the FTC of any jurisdiction to carry out the job," says the groups. "The question that should concern the Commission is whether or not the en banc panel will likewise deprive the FTC of jurisdiction over broadband access providers."

Consumer groups and New York City officials say things are compounded by the fact that large ISPs have lobbied the FCC to crack down on any states that rush in and dare try to protect consumers from privacy or net neutrality violations. So far, the FCC (which only defends "states rights" when apparently convenient) has said they're eager to do just that.

"This potential regulatory gap is further compounded by the Draft Order's purported preemption of any state regulations the FCC deems "incompatible" with the newly announced "deregulatory" federal policy," says the letter. "Although the Draft Order is vague as to what, precisely, the FCC is preempting, it would appear from context that it includes state consumer protection laws. In short, the FCC has decided to put all remaining consumer protection eggs in one basket, but cannot be troubled to wait until the Ninth Circuit affirms that this approach is actually consistent with the FTC's own jurisdictional statute."

The FCC's response to these entirely legitimate concerns? To call those worried about the agency's blatant handout to industry "desperate."

"This is just evidence that supporters of heavy-handed Internet regulations are becoming more desperate by the day as their effort to defeat Chairman Pai's plan to restore Internet freedom has stalled," the FCC told Ars Technica in a statement. "The vote will proceed as scheduled on December 14."

Granted, that kind of response is well in line with an agency that's intent on ignoring the record 22 million public comments on its Orwellian-named "restoring internet freedom" plan, which may just be the least popular tech policy agenda item in the agency's eighty-three-year history.

Washington State First to Pass Tough Net Neutrality Law
by Karl Bode
Wednesday Feb 28 2018 18:00 EST

Though Oregon and several other states were running neck and neck, Washington State was the first state in the country this week to pass tough net neutrality protections on the state level. Numerous states have embraced their own net neutrality rules in the wake of the FCC's extremely unpopular net neutrality repeal. Some of these efforts are taking the form of legislation, while others (like Montana) have taken the form of executive orders banning states from doing business with ISPs that violate net neutrality or engage in anti-competitive behavior.

In Washington, the bill cleared the state senate on a 35-to-14 bipartisan vote after passing 93-to-5 on February 9 in the House. Washington Governor Jay Inslee is expected to sign the legislation shortly.

"It’s swift bipartisan action to protect net neutrality, which is terrific," bill sponsor Drew Hansen told Fast Company.

Washington's new law prohibits ISPs that do business in the state from engaging in anti-competitive throttling and blocking of competing content. It also prohibits ISPs from striking "paid prioritization" deals that would allow one company (say, ESPN) from striking a deal that ensured its content was delivered more efficiently than competitors, distorting the level internet playing field in favor of those with the deepest pockets. Like the FCC's discarded rules, Washington's law carves out exemptions for network management and the prioritization of essential medical or other services.

Verizon and Comcast both successfully lobbied the FCC to include "pre-emption" language attempting to ban states from protecting consumers. But these efforts are legally untested, and the bill's sponsor specifically took some time to laugh in the FCC's general direction.

"Just because the FCC claims it has the power to preempt state laws doesn’t mean that it actually does," said Hansen. "I can claim that I have the power to manifest unicorns on the Washington State Capitol lawn. But if you look outside right now, there are no unicorns."
ISPs hope that the FCC's state pre-emption language holds up in court. They also hope the FCC's repeal withstands the numerous lawsuits headed the FCC's direction. Just in case they lose on both fronts, ISPs like AT&T are pushing for flimsy, phony net neutrality legislation in name only that would pre-empt potentially tougher rules.

Net Neutrality Repeal Reversal Now Has 50 Votes in the Senate
by Karl Bode
Tuesday Jan 16 2018 16:00 EST

an attempt to reverse the FCC's repeal of popular net neutrality rules now has the support of at least 50 Senators, according to the Washington Post. The effort, begun by Senator Ron Wyden, is attempting to use the Congressional Review Act to reverse the FCC's 3-2 partisan vote to repeal the rules. The CRA allows Congress to vote to reverse a regulator's decision -- provided the vote occurs within 60 days of the effort to repeal the rules. With only one Republican (Senator Susan Collins) now saying she'll vote for the measure, the effort needs just one more Republican vote to pass in the Senate.

Granted, the measure still has an uphill climb even if it passes the Senate.

The effort will also need a vote in the more tightly-controlled GOP House (you can find a list of which House lawmakers currently support the initiative here), and would also need to be signed into law by President Trump, neither of which seem particularly likely to happen given both's support of telecom duopolies.

But supporters say never say never. And Democrats believe that forcing lawmakers to put their unpopular fealty to Comcast, AT&T and Verizon to a documentable vote could prove handy as a weapon in the midterm battles to come given the popularity of the rules and the anger at the repeal.

"With full caucus support," said Senate Minority Leader Chuck Schumer. "It’s clear that Democrats are committed to fighting to keep the Internet from becoming the Wild West where ISPs are free to offer premium service to only the wealthiest customers while average consumers are left with far inferior options."
That said, the looming court battle remains the most-likely path toward any real success in reversing the FCC's repeal. The FCC engaged in so many missteps and bizarre behaviors during the fraud-riddled proceeding, they should have their hands full when the flurry of lawsuits arrive in the next few months