One of the constant irritants for me and others trying to follow what happens at the FCC is the problem of “the too brief ex parte.” Under the Commission’s rules (47 C.F.R. 1.1200, et seq), when a party meets with FCC staff on an open proceeding, the party is supposed to submit into the record a written statement providing a summary of the conversation. This is called a “notice of oral ex parte presentation” in FCC-speak, but we usually shorten this to just ex parte. By rule, the ex parte should provide a reasonable explanation of what took place so that a reader can get a sense of the argument made (although you can refer back to a previous filing to avoid repetition). In practice, however, you usually get nonsense like this piece of garbage from Alltel which wins the Comic Book Guy Award for “Worsht Ex Parte Ever.”
So it was with a considerable amount of schadenfreude that I saw the D.C. Circuit whomp Sprint/Nextel for producing crappy ex parte‘s that failed to provide a record of their no doubt numerous detailed conversations with Commission staff. This failure to leave a record resulted in dismissal of Sprint’s case and may cost it many billions of dollars.
More gloating below . . . .
First, because they so richly deserve this mockery, I must highlight Alltel’s ex parte and why it wins the prestigious Comic Book Guy Award. FCC rules explicitly state that an ex parte must not be a mere list of who attended the meeting, and must contain more than a mere list of things discussed. Well, the Alltel ex parte recording a recent meeting about the 700 MHz auction and associated issues doesn’t even rise to the level of a list of topics discussed — let alone a summary. As our Alltel correspondent tells it:
This letter is to inform you that on April 29, 2008, Alltel Communications LLC, through its representatives [list of names] met with Erika Olsen, Deputy Bureau Chief of the Public Safety and Homeland Security Bureau; and Jim Schlicting, Deputy Chief of the Wireless Telecommunications Bureau at their request, to share our thoughts on the above-captioned proceeding.
Pursuant to Section 1.1206 of the Commission’s rules, this letter is being electronically filed with your office. Please let me know if you have any questions regarding this filing.
Well, yes, I have a question: WHAT THE HECK DID YOU ALL TALK ABOUT? I’m sure it’s very nice that Eirka and Jim invited y’all to drop by and share your thoughts about the little ole 700 MHz auction and D Block. I’m sure you all loosened your ties, let down your hair, broke out the Starbucks, and just had the grandest old time sharing your thoughts. Now how about sharing your friggin’ thoughts with the rest of us? This is a bleeping FCC proceeding, not some episode of Dr. Phil in which a few Deputy Bureau Chiefs invite you by to share your thoughts so y’all can bond better. If two Deputy Bureau Chief’s go to the trouble of asking you to drop by to share your thoughts, I assume those thoughts are worth sharing with the rest of us as well.
Generally, there is not much we in public interest land can do about this. The FCC staff do have a responsibility to review the filed ex parte and can request that the parties expand on it if the ex parte doesn’t meet the minimum standard. But lets face it, the FCC staff generally do not have time to police this. And, occasionally, the FCC’s Office of General Counsel will issue a pointed reminder to folks that they must comply with the rules. But since there aren’t any penalties for failure to comply, this violation of the ex parte rules doesn’t matter very much.
OTOH, there is one sanction that does matter. When an agency makes a decision, it must do so on the basis of a written record. When a court reviews an agency decision, it will look exclusively to the written record to see what arguments got raised. If you raised some important issues in your meeting with FCC staff, but all you submitted for an ex parte was “we had a nifty conversation,” then there is no record of the argument you raised and the FCC can ignore it. This is why my ex parte‘s usually run several pages — because damn if I will give the FCC an excuse to ignore my arguments. Oh, and because I am an exemplar of shining virtue who always complies with rules on disclosure.
All of this brings us to the D.C. Circuit’s decision in Sprint Nextel Corp v. FCC. This case involves the nightmare known in spectrum policy as the “800 MHz Rebanding Order.” The background is waaaaay too complicated to explain here. Suffice it to say that Sprint Nextel is required to swap spectrum with a bunch of public safety entities. But moving the public safety guys is taking longer and costing more than expected. With a bunch of folks not ready to move yet, Sprint is stuck with a deadline to cease its operations in the 800 MHz and 900 MHz bands shared with other public safety systems by June 26, even if it cannot move its operations elsewhere. This will, Sprint says, result in massive disruptions to Sprint’s systems. So Sprint asked the FCC to give it more time.
The FCC said no, you need to get your rear in gear and get this done. Besides, you are causing ongoing interference with public safety systems, which is a bad thing. So Sprint then appealed to the D.C. Circuit, which surprisingly sided with the FCC and told Sprint tough nuggies.
On reading the decision, however, it emerges that one reason the D.C. Cir. is so unsympathetic is because Sprint failed to follow procedural rules and failed to raise its arguments at the agency level so the agency would have a fair chance of dealing with them. Courts in general, and the D.C. Cir. in particular, really hate it when people ignore the exhaustion of remedies statute (47 U.S.C. 405 for you folks playing along at home) and try to play “gotcha” with the agency. So the D.C. Circuit dismissed most of the arguments on the procedural grounds that Sprint had failed to raise its arguments below.
Sprint tried to explain that they had raised these arguments in its oral ex parte presentations. And here is where I start cackling with glee. I am sure that Sprint did raise its arguments in meetings with FCC staff. I’m sure they went on for hours and hours and hours, in loving detail, citing numerous engineering and business concerns that the FCC should consider when weighing whether to give Sprint more time. But I also expect that what Sprint actually said in the written ex parte notices submitted boiled down to “we came on in and shared our thoughts.”
The Court is quite scathing in its treatment of Sprint/Nextel’s ex parte traffic, but I will reproduce only the most delightful tidbit here:
Nextel insists it raised all of its arguments in its ex parte notices. We think not. Nextel’s ex parte notice only argued — in quite general terms — that the Commission unreasonably changed the rebanding process from a synchronized spectrum swap to an asynchronous exchange. Consequently, that is the only argument Nextel preserved for our review.
To which I can only add “ha ha!” It is rare when I see the noses of industry rubbed in the doggy-droppings of noncompliance before being whacked with the rolled up newspaper of dismissal, so forgive my indecent chortling. Still, I can hope that others will learn a valuable lesson from Sprint Nextel and their failure to preserve issues, and the next time they drop by the FCC to “share their thoughts” they will write those thoughts down and “share” them with the rest of us.
Stay tuned . . . .
Ex parte notification originally served as an offset to the inadvertent or accidental communication under conflict of interest, as a perfunctory note of explanation.
In some cases there were harsh penalities for not reporting the contact, which tended to deter the worst of the secret ones, like when a utility offered a state commissioner a job smack in the middle of a rate case in the early ’80s and all hell broke loose.
I was at the FCC to see small teams of high-level company representatives regularly frequent the place with well planned, targeted ex parte presentations as a matter of routine business. (see report by Center of Public Integrity)
Ex parte no longer protects the broad public interest. It has been turned on its head to provide privileged access to decision makers by the powerful who can finance it, particularly the ones who make the rounds on a regular basis. It imposes prohibitive cost on smaller players who cannot maintain the pace.
The defense that it provides useful information and provides a forum for questions and answers is the same one invoked by the lobbying industry that spends $17M/day on access to Congress when in session.
It’s not about who’s there, it’s about who’s not there and will never be there. Every ex parte contact should be recorded and posted on the web in video if not audio, with a transcript and comment section for rebuttal.
[Nelson Munson voice] HA HA! [/Nelson Munson Voice]