Consumers’ Research and its allies objected Friday to the proposed USF contribution factor for Q4, citing unanswered questions from the group’s unsuccessful challenge in the U.S. Supreme Court in late June. The factor is projected to increase from 36% in Q3 to 39.3% in Q4, based on the latest projections from the Universal Service Administrative Co. (see 2508040049).
Consumers’ Research said the 5th U.S. Circuit Court of Appeals should look more closely at an issue raised in the dissent and a footnote in the majority opinion of the Supreme Court’s decision in June upholding the legality of the USF. The FCC and DOJ last week asked the 5th Circuit not to require further briefing but close the case (see 2507170063).
The FCC and DOJ on Thursday asked the 5th U.S. Circuit Court of Appeals not to require a briefing on a potential remaining issue after the U.S. Supreme Court last month rejected a Consumers’ Research challenge to the way the FCC manages the USF (see 2507020049). The problem for the FCC has been a footnote in the majority opinion, which noted that several provisions in Section 254 of the Communications Act weren't challenged and which expressed no opinion about whether those posed any additional problems for the program (see 2507150081).
The FCC avoided a potentially disastrous result when the U.S. Supreme Court upheld the USF contribution factor in its Consumers’ Research decision last month (see 2507020049), HWG’s Chris Wright said during a practitioners panel that was part of an FCBA CLE Tuesday (see 2507150081). “If the case had gone the other way” it would have “called into question almost everything in the Communications Act,” said Wright, a former FCC general counsel.
The U.S. Supreme Court’s decision last month upholding the USF in the Consumers’ Research case was a win for the FCC (see 2507020049), but the fight isn’t over, Jacob Lewis, FCC associate general counsel, said during an FCBA CLE on Tuesday. Lewis warned that Consumers’ Research has already renewed its challenge in the 5th U.S. Circuit Court of Appeals, making a different argument for overturning parts of the fund.
While the U.S. Supreme Court’s decision last month upholding the USF (see 2506270054) was a win for consumers, questions about the future of the fund won’t go away, Pillsbury lawyers wrote Thursday. Carriers that pay into the USF “get to decide whether to pass those costs through to their customers or absorb [them], and due to the high cost, most choose to pass some if not most of that fee on to customers in the form of a line-item USF charge on their phone bill,” the lawyers blogged. Now that the fund has survived judicial challenges, “advocates will look to Congress and the FCC to expand the contribution base to ensure sustainable funding in the face of eroding revenues from traditional telecommunications sources and the rapid growth of broadband and other connectivity services.”
Lawyers for the Schools, Health & Libraries Broadband Coalition and the Benton Institute for Broadband & Society said Monday that the U.S. Supreme Court’s decision last month upholding the USF was a clean win for the program and the FCC (see 2507020049). By rejecting the challenge -- brought by Consumers’ Research, a right-wing group -- SCOTUS lifted a cloud that has loomed over the USF for years, the lawyers said during an SHLB webinar.
Leaders of the House and Senate Commerce committees who are spearheading the bipartisan congressional working group on a USF legislative revamp, which relaunched in June (see 2506120091), told us they plan to begin meeting again this month. But they said they feel less pressure to quickly reach an agreement on legislative recommendations since the U.S. Supreme Court's recent ruling in Consumers’ Research v. FCC, which found that USF’s funding mechanism is constitutional (see 2506270054). Sens. Ben Ray Lujan, D-N.M., and John Thune, R-S.D., formed the working group in 2023 as Communications Subcommittee chairman and ranking member, respectively (see 2305110066).
Former FCC Commissioner Mike O’Rielly said Wednesday that while he has long been a critic of the USF, he was relieved that the U.S. Supreme Court last week didn’t overturn the program (see 2506270054). Cutting off support that USF recipients need would be “a terrible outcome,” O’Rielly said during a Broadband Breakfast webinar.
The U.S. Supreme Court upheld the FCC’s USF contribution scheme in a 6-3 opinion Friday in Consumers’ Research v. FCC, but dissenting and concurring opinions from several conservative justices appeared to invite future challenges, attorneys told us.