D.C. Circuit Tackles 60-Day Review Period on USAC Decisions
Parties have 60 days to appeal a Universal Service Administrative Co. decision to the FCC. But does a USAC invoice count as a “decision"? That was the question before the U.S. Court of Appeals for the D.C. Circuit Friday, as call center software provider inContact argued the Wireline Bureau exceeded its authority in finding the clock started from the date of an invoice. The full commission acted in an arbitrary and capricious manner when it “rubber stamped” the bureau’s decision, said inContact attorney Jacqueline Hankins of Marashlian and Donahue. An FCC spokesman told us “the Commission’s decision was fully considered and legally sound."
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The bureau essentially engaged in “unlawful rulemaking” when it equated the invoice with a “decision” without any commission-level precedent, Hankins told the court. FCC Rule 54.720(a) gives a party 60 days from “the issuance of the decision by a division or Committee” of the USAC board to request commission review. Because a bureau can’t conduct a rulemaking, the full commission was acting in an arbitrary and capricious manner when it upheld the bureau’s decision, Hankins said. The term “decision” is ambiguous, she said; USAC routinely issues reasoned decisions, but an invoice is just an automatically generated billing statement, she said.
InContact’s woes go back to 2004, when USAC invoiced the company for about $1 million to “true-up” its account. Five years later, USAC sent an invoice for an additional $300,000, explaining it had miscalculated the 2004 figure. InContact said in its brief to the D.C. Circuit that because of the FCC’s then-existing three-year document retention rule, it lacked the records required to confirm or rebut USAC’s calculations. About 80 days after the date on the invoice, inContact appealed to the FCC. The bureau denied the petition for review, citing an FCC rule limiting appeals of USAC decisions to 60 days. InContact appealed to the full commission to review, which -- 18 months later -- denied the petition, finding the bureau had properly applied the 60-day rule.
The commission was also “effectively avoiding” the underlying substantive issue when it approved the bureau’s order, Hankins said. Judge Merrick Garland didn’t seem to mind. “You miss a filing deadline, you don’t get a decision on the underlying issue,” Garland said. When inContact complains about the commission’s “procedural excuse,” that’s just “another way of saying, ‘you missed the deadline,'” he said. Garland also took issue with Hankins’s description of the commission action as a “rubber stamp.” If that were the case, it would be an easy decision, he told her.
"The only thing that exists is the invoice itself,” said FCC attorney Pamela Smith, explaining that it reflects a “decision” made by the USAC finance department. In the last election, they talked about “Obama phones,” said Judge Raymond Randolph. “This is where Obama phones come from?” he asked. The phrase was coined in 2009 to make a political issue out of the Lifeline program, administered by USAC, which subsidizes telephones for low-income households. “Yes,” Smith said, explaining USAC’s role to the court.