Rep. Pickering Suggests Relationship Between the DOJ's Brand X Cert Petition and the FCC's CALEA NPRM

September 8, 2004. Rep. Chip Pickering (R-MS), the Vice-Chairman of the House Commerce Committee, discussed the relationship between the Department of Justice's (DOJ) decision last month to petition the Supreme Court for writ of certiorari in the Brand X case, and the Federal Communications Commission's (FCC) decision last month to issue its Notice of Proposed Rulemaking and Declaratory Ruling (NPRM & DR) [100 pages in PDF] imposing Communications Assistance for Law Enforcement Act (CALEA) obligations upon broadband internet access services and voice over internet protocol (VOIP).

He suggested at a hearing held by the Subcommittee on Telecommunications and the Internet on September 8 that the DOJ leveraged its power in the Supreme Court certiorari process to obtain from the FCC the NPRM pertaining to CALEA. In this arrangement, the DOJ got the CALEA interpretation and rule making proceeding that it wanted, while the FCC majority got the petition for writ of certiorari in the Brand X case that it wanted.

A witness from the Federal Bureau of Investigation (FBI) denied at the hearing that there was a quid pro quo.

Background on Brand X Case. On March 14, 2002, the FCC adopted a Declaratory Ruling and Notice of Proposed Rulemaking [75 pages in PDF]. The Declaratory Ruling (DR) component of this item states that "we conclude that cable modem service, as it is currently offered, is properly classified as an interstate information service, not as a cable service, and that there is no separate offering of telecommunications service." This item is FCC 02-77 in Docket No. 00-185 and Docket No. 02-52.

Treating broadband internet access providers, including cable modem service, as an information service is a critical part of FCC Chairman Michael Powell's (at left) strategy for promoting broadband deployment, competition, innovation, and the digital migration. He is supported in this by Republican Commissioners Kevin Martin and Kathleen Abernathy. If cable modem service were a telecommunications service, then it would be subject to the economic regulatory regime that applies to telecommunications services. (On the other hand, classifying broadband internet access services as telecommunications services could also subject these services to CALEA obligations, which apply to telecommunications carriers, and not to information services.)

On October 6, 2003, a three judge panel of the U.S. Court of Appeals (9thCir) issued its opinion [39 pages in PDF] (which is also published at 345 F.3d 1120) vacating the FCC's declaratory ruling. This opinion threatens to derail Chairman Powell's plans. See, story titled "9th Circuit Vacates FCC Declaratory Ruling That Cable Modem Service is an Information Service Without a Separate Offering of a Telecommunications Service" in TLJ Daily E-Mail Alert No. 754, October 7, 2003; and story titled "Reaction to 9th Circuit Opinion in Brand X Internet Services v. FCC" in TLJ Daily E-Mail Alert No. 756, October 9, 2003.

However, to obtain Supreme Court review of the 9th Circuit decision, the FCC majority needed the support of the Office of the Solicitor General (OSG), which is a part of the DOJ.

The DOJ's strategy for fighting crime and terrorism includes expanding the scope of the CALEA to include broadband internet access, VOIP, and other information services and products. Yet, the CALEA gives authority to promulgate implementing rules to the FCC, not the DOJ. As a result, the DOJ needs the FCC's support to achieve its CALEA goals, the the FCC majority needs the DOJ's support to achieve its goals.

On September 1, 2004, the DOJ's OSG and the FCC filed a Petition for Writ of Certiorari [37 pages in PDF] with the Supreme Court in the Brand X case. See, story titled "Office of the Solicitor General Backs FCC in Brand X Case" in TLJ Daily E-Mail Alert No. 968, September 2, 2004.

September 8 Hearing. Rep. Pickering (at right) questioned witnesses about the Brand X case and the CALEA NPRM at the September 8 hearing. He first noted the sequence and proximity in time of the FCC's release of its NPRM (August 4), and the DOJ's filing of a petition for writ of certiorari (September 1).

Rep. Pickering first questioned Julius Knapp, the Deputy Chief of the FCC's Office of Engineering and Technology (OET), who was a witness at the hearing.

He asked Knapp, "Was there an agreement between the Justice the FBI and the FCC to do so." Knapp answered, "No there wasn't." Rep. Pickering then asked, "Was there any discussion?" Knapp said, "No there wasn't." However, he added, "certainly we were aware that it was important for the Department of Justice and the FBI".

Rep. Pickering then asked Laura Parsky (a Deputy Assistant Attorney General in the DOJ's Criminal Division) and Marcus Thomas (Deputy Assistant Director of the FBI in charge of its Investigative Technology Division), "Was there any communication between the FCC, the FBI, and the Justice Department of Justice concerning the Solicitor General's appeal of the Ninth Circuit Court of Appeals decision?"

Parsky said this. "The Department of Justice has many components. The Solicitor General's Office is in the Department of Justice, Criminal Division, and FBI. We, in the Criminal Division, and the FBI, are concerned with CALEA, and with the provisions of CALEA, and with protecting law enforcement's equities in CALEA. So, to the extent that our concerns could in any way come into play, that is something that we obviously would be consulting within the Department of Justice on. And, we did. So, it was something that we weighed in on, but it was more to the extent that we were looking to make sure that if there were any possible implications on CALEA, that we look to those."

Thomas said that "we expressed our concerns regarding the impact" of court decisions. But, he asserted that "there was no discussion about a quid pro quo or anything like that."

Rep. Pickering concluded that "I am not saying that there was necessarily anything wrong about reaching an agreement between the Justice Department, the FBI and the FCC as to an appeal or not an appeal ... and trying to coordinate policy objectives to stimulate both, in our nation, investment, while at the same time meeting public safety and enforcement needs. So, I am not saying that this was anything inherently wrong. I just think that we should be transparent about it."

Rep. Pickering also spoke with reporters after the hearing. He said that this was "part of an interagency process to get multiple objectives met at the same time. The leverage point for Justice and the FBI was the 9th Circuit Court of Appeals. It was very important for the FCC -- telecom policy. For the FBI and Justice, CALEA is very important to them, and they leveraged it. And hopefully, both will get what they needed. But, I just thought that we should be upfront and honest about it."

He added that "There was no formalized agreement. But, I think that it is clear that you had an interagency process or communication. For the FCC, it was very important for them to have the Solicitor General appeal the decision of the Ninth Circuit. And, it was very important for the FBI and the Justice Department to have the FCC begin a CALEA proceeding. Both have now been done."

He also commented "It probably would be hard for them to come out and say that we are appealing this so that we can get CALEA, and not just address the merits of the underlying case. But, I do think that here you have a good example of an interagency process with competing objectives, that were reconciled and resolved in the manner in which it happened."

Prospects for Legislation in the 108th Congress. Rep. Pickering also spoke with reporters about legislation. He introduced HR 4129, the "VOIP Regulatory Freedom Act of 2004", in the House on April 2, 2004. See, story titled "Sununu and Pickering Introduce VOIP Regulatory Freedom Bills" and story titled "Summary of VOIP Regulatory Freedom Bills" in TLJ Daily E-Mail Alert No. 872, April 8, 2004.

His bill also addresses CALEA and surveillance. It contains a long and complex subsection creating statutory requirements for providers of "connected VOIP applications". It would require them to "ensure that its equipment, facilities, or services are capable of ... enabling the government to intercept communications transmitted using such application ... delivering such intercepted communications and call-identifying information to the government".

(His bill defines a "connected VOIP application" as "a VOIP application that is capable of receiving voice communications from or sending voice communications to the public switched telephone network, or both.")

The Pickering bill does not expand the CALEA to include connected VOIP applications. Rather, it creates a new requirement, with a separate statutory basis. But, in the end, it makes the requirements imposed on providers of connected VOIP applications similar to the requirements imposed by the CALEA upon telecommunications carriers.

Rep. Pickering was asked about the prospects for passing legislation in the current Congress. He said that "if we go forward, I plan to drop the provision that relates to CALEA, to keep it as simple and as clean as possible. Let the FCC do its job."

He added that "I think that there is still a chance of a clean narrow production, that does not get into any other issues, and keeps a narrow focus". He concluded that "a decision will be made within the next two weeks" as to whether there will be a mark up.

The Senate Commerce Committee passed a VOIP related bill on July 22, 2004. See, story titled "Senate Commerce Committee Passes VOIP Regulation Bill" and story titled "Summary of VOIP Bills" in TLJ Daily E-Mail Alert No. 946, July 27, 2004.