Trump Names FCC Chairman Who Has Been Critical of Former Leadership

On Friday Politico reported that President Donald Trump will select Republican Ajit Pai to become the new chairman of the Federal Communications Commission (FCC).  

Per Politico:

“Pai, a Barack Obama nominee who has served as the senior FCC Republican for more than three years, could take the new role immediately and wouldn't require approval by the Senate because he was already confirmed to serve at the agency. 

Pai was widely assumed to be taking the agency’s gavel at least temporarily as an acting chairman at the beginning of Trump’s tenure. But Trump’s decision to make him a more permanent chairman affords the Kansas-bred Republican a bigger mandate to make his mark on the agency and its rules.”

A Forbes article yesterday reported that President Trump has made the designation official.

Pai has been an outspoken critic of many of the policies and rules enacted under the outgoing Chairman, Thomas Wheeler and has spoken publicly about the fractured and partisan practices of the FCC under Wheeler. On March 22, 2016 Pai testified to the Subcommittee on Communications and Technology for the House Energy and Commerce Committee held a hearing on “Oversight of the Federal Communications Commission” (FCC).

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At that hearing, he said:

“First, the FCC continues to be run in a partisan fashion. Since December 2013, there have been 20 separate party-line votes at our monthly meetings.  That’s twice as many as under Chairmen Martin, Copps, Genachowski, and Clyburn combined.  Proposals from Republican Commissioners have been roundly rejected as crossing a “red line,” even when an identical proposal from a Democratic Commissioner is accepted later on.  And requests by Republican Commissioners to increase transparency or amend a proposal are routinely ignored, which means the Commission regularly adopts orders without any official response to our requests.

Second, collaboration has fallen by the wayside.  During my first eighteen months on the job, every Commissioner worked to reach consensus.  That maximized the chance that every Commissioner could vote for a proposal or order.  Under Chairman Genachowski and Chairwoman Clyburn, we reached consensus 89.5% of the time on FCC meeting items.  I can assure you that we did not always start out in the same place.  But we worked hard to reach agreements that everyone could live with.  And we usually succeeded.

It’s far different now.  All too often, softening the rough edges of an order to make it more palatable is off the table.  Narrowing the scope of a decision to achieve unanimity is rejected outright.  Indeed, consensus among the Commissioners no longer appears to be a goal.  Instead, the “rule of three” is the new norm.  Unsurprisingly, then, unanimity has precipitously dropped at the agency.  Commissioners have been able to reach consensus on only 56.4% of our monthly votes during Chairman Wheeler’s tenure.

Third, the FCC continues to choose opacity over transparency.  The decisions we make impact hundreds of millions of Americans and thousands of small businesses.  And yet to the public, to Congress, and even to the Commissioners at the FCC, the agency’s work remains a black box.

InsideARM Perspective

This announcement should be considered very positive new for the ARM industry.

Pai’s dissent in the July 10, 2015 TCPA Omnibus Declaratory Ruling and Order provides some insight into his thinking regarding the TCPA and its application to legitimate business communications with consumers.

You can read the full text of the ruling here; Pai’s dissent begins on page 112.  Per his dissent:

“The TCPA’s private right of action and $500 statutory penalty could incentivize plaintiffs to go after the illegal telemarketers, the over-the-phone scam artists, and the foreign fraudsters. But trial lawyers have found legitimate, domestic businesses a much more profitable target. As Adonis Hoffman, former Chief of Staff to Commissioner Clyburn, recently wrote in The Wall Street Journal, a trial lawyer can collect about $2.4 million per suit by targeting American companies.

So it’s no surprise the TCPA has become the poster child for lawsuit abuse, with the number of TCPA cases filed each year skyrocketing from 14 in 2008 to 1,908 in the first nine months of 2014.

Some lawyers go to ridiculous lengths to generate new TCPA business. They have asked family members, friends, and significant others to download calling, voicemail, and texting apps in order to sue the companies behind each app. Others have bought cheap, prepaid wireless phones so they can sue any business that calls them by accident. One man in California even hired staff to log every wrong-number call he received, issue demand letters to purported violators, and negotiate settlements. Only after he was the lead plaintiff in over 600 lawsuits did the courts finally agree that he was a 'vexatious litigant.' 

The common thread here is that in practice the TCPA has strayed far from its original purpose. And the FCC has the power to fix that. We could be taking aggressive enforcement action against those who violate the federal Do-Not-Call rules. We could be establishing a safe harbor so that carriers could block spoofed calls from overseas without fear of liability. And we could be shutting down the abusive lawsuits by closing the legal loopholes that trial lawyers have exploited to target legitimate communications between businesses and consumers.

Instead, the Order takes the opposite tack. Rather than focus on the illegal telemarketing calls that consumers really care about, the Order twists the law’s words even further to target useful communications between legitimate businesses and their customers.561 This Order will make abuse of the TCPA much, much easier. And the primary beneficiaries will be trial lawyers, not the American public.” 

We will watch to see whether, under Mr. Pai, the FCC works to reverse some of the more onerous provisions of that July 10, 2016 order.