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Federal Regulations Advisor Insight and Commentary on U.S. Government Regulatory Affairs

Monday Morning Regulatory Review – 5/19/14: Open Internet or Net Neutrality; Broadcaster Shared Resources; Conflict Mineral Stays III; Coal Dust Consolidation; & ACUS Agenda

Posted in Judicial Process, Judicial Review & Remedies, Regulatory Process

The Federal Communications Commission (FCC) proposed their response to the loss of their “net neutrality” rules, and a petition was filed challenging guidance on transactions under the broadcast ownership rules, another sore spot in the FCC’s regulatory warehouse.  The United States Court of Appeals for the District of Columbia Circuit declined to stay the remainder of the Securities and Exchange Commission (SEC) conflict minerals rule while it considered other compelled speech challenges.  Meanwhile, the challenges to the Department of Labor (DOL) Federal Mine Safety and Health Administration (FMSHA) coal dust regulations have been assigned to the Eleventh Circuit.  On a more academic and agency planning note, the Administrative Conference of the United States (ACUS) published its agenda for its 60th Plenary Session with four recommendations and reports worth considering.

Open Internet or Net Neutrality:  The FCC released a revised open internet proposal in response to the D.C. Circuit decision in Verizon v. FCC that struck down its prior “net neutrality” rule.  The FCC has twice unsuccessfully attempted to develop legally enforceable rules for the internet, and twice lost.  As the FCC admits, “Today, there are no legally enforceable rules by which the [FCC] can stop broadband providers from limiting Internet openness.”   The FCC’s proposal would:

  1. retain the definitions and scope of the 2010 rules;
  2. enhance the transparency rule that was upheld by the D.C. Circuit;
  3. include the text of the no-blocking rule from the previous rule with a revised rationale;
  4. require broadband providers to adhere to an enforceable legal standard of commercially reasonable practices where conduct would otherwise be permissible under the no-blocking rule
  5. a dispute resolution process for end users, edge providers, and broadband network providers; and
  6. open authority for a final rule to be adopted under a broader spread of FCC statutory authority.

The proposed rule seeks to comply with the Regulatory Flexibility Act (RFA) and Paperwork Reduction Act (PRA) and commenters should consider whether the FCC has succeeded.  Public comments are due to the FCC’s idiosyncratic docket system by July 15, 2014, and reply comments are due September 10, 2014.

Broadcaster Shared Resources:  In a new filing, National Assoc. of Broadcasters v. FCC, D.C. Cir. No. 14-1072 (filed May 12, 2014), broadcasters asked the court to strike down recent FCC guidance Processing of Broadcast Television Applications Proposed Sharing Arrangements and Contingent Interests.  The FCC’s Media Bureau adopted the guidance in March to provide a more stringent review of inter-broadcaster service arrangements in light of the FCC’s rules limiting broadcast ownership.  The broadcasters, however, allege that the guidance “adopts a categorical presumption against certain broadcast television transactions involving sharing arrangements and contingent or other financial interests” and a “practical prohibition” of a class of transactions, and, therefore, violates the Administrative Procedure Act (APA) because it was not adopted as a rule.

The court may again edge into that murky twilight zone of standards for when an agency action requires a rulemaking under the APA.  Although the guidance does not appear to contain the authority or procedural hallmarks of a rule, the broadcasters are arguing that it contains he compulsory / prohibitory hallmark sufficient alone to require rulemaking.

Conflict Mineral Stays III:  The D.C. Circuit, in a summary per curiam order after full briefing, denied the petitioners motion for a stay of the SEC’s conflict minerals rule, leaving the report filing requirements and June 2, 2014, deadline in place, but without the public disclosure (or shaming) provisions struck down last month in National Association of Manufacturers v. SEC.  A panel of the court vacated part of the rule that required companies to state publicly that their products aren’t “conflict free” – i.e. produced with tin, tantalum, tungsten and gold from the Democratic Republic of the Congo or adjoining countries – because the provision compelled speech in violation of the First Amendment to the United States Constitution.

  Similar regulatory compelled speech issues will be argued today before the en banc D.C. Circuit in American Meat Institute v. Department of Agriculture.  Stay tuned – these issues (if not these cases) will, without doubt, reach the United States Supreme Court (SCOTUS) in the relatively near future.

Coal Dust Consolidation:  As expected last week, the FMSHA noticed the multiple – Sixth Circuit and Eleventh Circuit – petitions for review of its coal dust regulations with the Judicial Panel on Multidistrict Litigation (JPMDL) on May 13, 2014, and the JPMDL randomly assigned all of the proceedings to the Eleventh Circuit on the same day.  Filing of the administrative record and briefing of both petitions for review now begins.

ACUS Agenda:  ACUS published its agenda for the 60th Plenary Session in last Friday’s Federal Register.  The agenda for the 60th Plenary Session, to be held beginning at 2:00 PM on Thursday, June 5, 2014, and 9:00 AM on Friday, June 6, 2014, includes four sets of recommendations and accompanying reports:

  • Ex Parte Communications in Informal Rulemaking – identifies procedures and best practices for managing written and oral communications that may occur between an agency and interested persons  regarding the substance of an anticipated or ongoing informal rulemaking proceeding that are not placed in the docket at the time they occur.
  • Guidance In The Rulemaking Process:  Evaluating Preambles, Regulatory Text, And Freestanding Documents As Vehicles For Regulatory Guidance – identifies best practices for agencies to follow when providing guidance in preambles to final rules.
  • Reducing FOIA Litigation Through Targeted ADR Strategies – suggests ways that Office of Government Information Services (OGIS) can maximize the effectiveness of its resources to help requesters and agencies resolve Freedom of Information Act (FOIA) disputes through the use of mediation and other litigation alternatives.
  • Government in the Sunshine Act – proposes best practices to enhance transparency of decisionmaking at multi-member boards and commissions subject to the Government in the Sunshine Act.
  • ACUS routinely streams video of these meetings on its website to the benefit of the administrative law community.