Chinese multinational ZTE will plead guilty and pay $430.5 million to the U.S. government for illegally shipping U.S.-origin wireless and wireline infrastructure hardware to customers in Iran for almost six years, obstruction of justice, and “making a material false statement,” DOJ announced. In total, ZTE will pay the government $892.4 million, under the impending guilty plea and settlement agreements reached with the Commerce Department's Bureau of Industry and Security (BIS) and Treasury's Office of Foreign Assets Control, DOJ said. BIS suspended another $300 million in penalties, which ZTE will pay if it breaches its settlement with the agency, DOJ said. ZTE lied to federal investigators and “deceived their own counsel and internal investigators” about the illegal acts, Attorney General Jeff Sessions said in a statement. An independent corporate compliance monitor will review and report on ZTE’s export compliance program over the next three years, during which the company will remain on corporate probation, according to DOJ’s announcement. “Criminal information” filed March 7 in federal court in the Northern District of Texas charged ZTE with one count of “knowingly and willfully” conspiring to violate the International Emergency Economic Powers Act, and one count each of obstructing justice and making a material false statement. ZTE then signed a plea agreement with the government, which the court must still approve, DOJ said. BIS four times extended the original June 30, 2016, deadline for a temporary general license for ZTE that maintains normal licensing requirements for exports, re-exports and in-country transfers to ZTE and ZTE Kangxun (see 1702230001), after announcing sanctions against the two entities and two affiliated firms on March 8, 2016 (see 1603070001). The current temporary general license expires March 29.

Free-market oriented groups urged the FCC to reverse its ISP privacy rules, approved in October. The FCC posted thousands of public comments this week on the rules (see 1703060054), many of them urging the agency to better align its rules with those of the FTC. The Institute for Policy Innovation (IPI) said the FCC should reject the October rules. “Part of the FCC’s agenda under new Chairman Ajit Pai should be to undo the errors and mistakes of the previous regime,” IPI said in a filing in docket 16-106. Under former Chairman Tom Wheeler, “the FCC made a distinct departure from sound policy analysis, disregarded empirical evidence, showed contempt for input from Congress and from other federal agencies, neglected cost/benefit and other economic analysis, and stubbornly pursued a narrow ideological agenda,” IPI said. The Information Technology and Innovation Foundation reminded the FCC that the privacy rules were approved in the “waning days” of the Obama presidency. “Thankfully, the Commission now has an opportunity to revisit these flawed rules,” ITIF said in a filing. “The Commission should vacate these rules in their entirety or significantly revise the rules such that they ‘parallel the [Federal Trade Commission’s] framework as closely as possible’ so as to not erect technology-based regulatory silos, unduly impede innovation, or diminish dynamic, cross-sector competition.” Consumer Policy Solutions said in a filing it makes little sense for the FCC to impose unique rules for just ISPs. “The process for developing privacy regulations should be through a multi-stakeholder process with FCC, FTC, and NTIA collaboration with consumer organizations, industry, academics, government and policy leaders, and privacy policy experts,” the group said. “Consumers want and need a more consistent approach to privacy regulation that will match their online experience.” But the Center for Digital Democracy, Campaign for a Commercial-Free Childhood, Institute for Public Representation, Common Sense Kids Action, Consumer Action and the Electronic Privacy Information Center said the FCC should preserve the rules. “Children’s Advocates oppose the request of some petitioners to rescind the rules in their entirety,” the groups said in a filing. “Because the FTC’s Section 5 jurisdiction does not extend to common carriers, the effect of rescinding the rules in their entirety could mean that parents would have no control over their ISP’s use of their children’s information.” The groups also opposed petitions seeking to modify the privacy rules by changing the classification of certain sensitive information to nonsensitive, or replacing opt-in consent with opt-out. “These proposed modifications would significantly weaken privacy protections for children.”

FCC Commissioner Mike O'Rielly said he would back reconsideration of the FCC's Connect America Fund Phase II bid weights decision (see 1702230019) since it "seem[ed] to intentionally favor fiber over wireless and satellite" in setting the weights for determining winning bids. At Monday's Satellite Industry Association (SIA) dinner, O'Rielly said he was "more than disturbed" with the ruling and though there's logic to setting quality and speed goals, favoring particular technologies "does not comply with our obligation to serve as many of the unserved as possible within our budget," according to the released text. He previously raised the idea of reconsideration at the FCC's February vote. At the SIA event, O'Rielly also criticized some spectrum frontiers decisions, calling them "best guesses ... destined to be raised on reconsideration." He said the earth station siting requirements in the 28 and 39 GHz bands didn't make sense. O'Rielly also was critical of the 2015 World Radiocommunication Conference (WRC) decision to block study of the 28 GHz band, saying "we should consider as many bands as possible for potential commercial wireless and satellite use, with the understanding that some bands may not be suitable for sharing." Pointing to WRC-19 agenda items 1.13 about terrestrial use and 1.6 about regulatory frameworks for non-geostationary satellite systems in the same frequency band, O'Rielly said, "I am sure there are heated debates to come, but studies need to be encouraged, not stymied, to inform how spectrum can be shared and to help regulators -- both here and abroad -- adopt sound spectrum policy."

The FCC might act on business data services (BDS) regulation in April, though it could take longer, industry representatives told us this week. "They could act as soon as April," said one stakeholder. Asked about the speculation, an attorney emailed, "I also heard a rumor about April, but the FCC staff members I spoke to were noncommittal about timing. I would be a little surprised if they got it on the April meeting agenda." Asked about potential BDS action, another industry representative emailed: "Possibly in next several months, FCC releases NPRM to deregulate BDS." BT lobbied all three FCC commissioners against "precipitously writing rules" on BDS and technology transitions "that would kill competition" (see 1703060053). The FCC declined comment Tuesday.

The Communications, Security, Reliability and Interoperability Council (CISRIC) will meet March 15 at 1 p.m. in the FCC meeting room, said a commission public notice Monday.

A March 13 workshop on the post incentive auction transition will feature reviews of the procedures for filing applications for construction permits, procedures for receiving reverse auction winnings and reimbursements, and a Q&A with FCC staff, said a public notice released Monday by the Incentive Auction Task Force and the Media Bureau.

The Supreme Court decided not to hear the case of a transgender high school student who challenged a Virginia county school board over a policy that restricts bathroom access to individuals based on their biological sex. Dozens of major technology companies, including Apple and Microsoft, last week filed an amici brief supporting student Gavin Grimm against the Gloucester County School Board (see 1703020037). The high court, which had scheduled oral argument later this month, said it remanded the case to the 4th U.S. Circuit Court of Appeals for further consideration "in light of the guidance document issued by the Department of Education and Department of Justice on February 22." The departments withdrew guidance issued last year that required public schools to let transgender students use bathrooms based on their gender identity (see 1702230035). A district court upheld the school's bathroom policy, but the 4th Circuit overturned that decision last year.

The Mortgage Bankers Association (MBA) is asking the FCC to reconsider a November order by the Consumer and Governmental Affairs Bureau rejecting a petition by the group for an exemption from the prior express consent requirement of the Telephone Consumer Protection Act for autodialed or prerecorded “mortgage servicing” calls to wireless phones (see 1611150046). MBA reported on meetings with aides with the three FCC commissioners to discuss its Dec. 15 application for review of the order. “As we discussed during our meeting, the Order was an inappropriate exercise of delegated authority because the Petition presented a novel legal issue of first impression deserving of full Commission consideration, not a minor or routine matter or one that is settled in nature for the Bureau to decide,” said a filing on one of the meetings, in docket 02-278. “For this reason alone, the Petition deserves full consideration by the Commission untainted by the Bureau’s hasty Order.”

BT pressed its concern about possible FCC business data service action. "BT urged caution against precipitously writing rules regarding BDS and technology transition that would kill competition and further expand and strengthen the dominance of incumbents, highlighting that caution, scrutiny and fresh data are in order in light of the rapid concentration taking place in the telecommunications industry," said its filings Monday in docket 05-25 on meetings with aides to Chairman Ajit Pai and Commissioner Mignon Clyburn (here and here). BT met earlier with an aide to Commissioner Mike O'Rielly (see 1703020048). In separate meetings with the Pai and Clyburn aides, Incompas discussed the status of BDS-related proceedings, according to filings (here and here)

New Commerce Secretary Wilbur Ross quietly met with House Commerce aide David Redl, most likely to discuss picking Redl as next NTIA administrator, industry officials said Monday. Redl is viewed as a top candidate for the post (see 1702240049) with support from industry and within the federal spectrum community. The industry officials said that doesn’t guarantee Redl will be named, but he's now the most likely candidate for the key communications position. Senate Commerce Committee Chairman John Thune, R-S.D., has made clear his support for David Quinalty, his communications aide, for the job (see 1703010071). “I would think that the administration would want to counter the criticisms that so many political positions remain unfilled,” a former NTIA official said. Ross was sworn in as secretary last week (see 1702280048). A department spokesman declined to comment. Redl didn't comment.