Some States Dispute FCC as Independent Agency in Prison-Calling Brief
States opposing the FCC’s July order implementing the Martha Wright-Reed Act of 2022 have shifted gears in part to challenge whether FCC decision-making is legitimate because of the false premise that the regulator is an independent agency. The order, which reduces calling rates for people in prisons while establishing interim rate caps for video calls (see 2407180039), is under appeal in the 1st U.S. Circuit Court of Appeals (24-8028).
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The opposing states aligned themselves with the Trump administration's arguments that the presidency has sweeping powers under the so-called unitary executive theory. Incarcerated people’s communication services (IPCS) providers Securus and Pay Tel also filed a reply brief this week, while groups concerned about prisoners and their families largely defended the order while seeking a few changes.
The case pits “blue” states against mostly “red” states. New York, California, Illinois, Maine, Maryland, Massachusetts, Minnesota, Nevada, New Jersey and Rhode Island have filed in defense of the FCC (see 2504300008). Indiana, Arkansas, Louisiana, Alabama, Florida, Georgia, Idaho, Iowa, Mississippi, Missouri, Ohio, South Carolina, South Dakota, Tennessee, Texas, Utah and Virginia, along with law enforcement officials from Louisiana, support overturning the order. Except for Virginia, all the states opposing the order voted for Trump in November.
“The FCC does not even attempt to argue that the protection from at-will removal by the President, which the FCC has long been understood to enjoy, is unconstitutional,” the conservative states said. “For good reasons: the FCC’s removal protections are clearly not lawful … and the agency’s independence, and the manner in which that independence influenced this rulemaking process that produced the IPCS Rule, caused direct harm to the States.”
Those states also argued that the commission “far exceeded its statutory authority in issuing the Rule” by “attempting to ban site commission payments and failing to consider security costs adequately when these are significant costs that state and local incarceration facilities incur to provide call services.” The order is also “invalid because it is based on unreasoned decisionmaking and a flawed assessment of costs and benefits.”
Securus and Pay Tel continued to argue that the conservative-dominated 5th Circuit and not the 1st should hear the case (see 2502140049). The FCC violated a requirement to ensure that all IPCS providers “are fairly compensated,” the companies said. “Congress required the FCC to select rate caps that [are both] within the zone of reasonableness and fairly compensate all providers.”
The FCC also wrongly excluded safety and security and facility costs in its compensation and “arbitrarily used unpaid minutes when calculating rate caps,” the providers said: “The FCC’s decisions to prohibit IPCS providers from recovering the costs of ancillary services through separate charges and to enforce that prohibition before the rest of its rate restructuring were arbitrary and capricious.”
The order “makes significant progress in reforming rates and charges” for IPCS, countered Direct Action for Rights and Equality, the Criminal Justice Reform Clinic and the Pennsylvania Prison Society. The groups said they want the 1st Circuit to leave the rates in place while ordering the FCC to make changes to the rules that would further lower costs for prisoners and their families.
“The Commission correctly excluded most categories of safety and security costs, but it unlawfully and unreasonably included communications security services costs despite those costs primarily serving law-enforcement purposes rather than benefitting IPCS consumers,” they said: The FCC “should have included additional consumer protections when it allowed alternate pricing plans -- particularly for flat-rate plans that permit providers to charge rates higher than the ‘just and reasonable’ rate caps the Commission imposed.” The commission also “unreasonably rejected a much-needed proposal for a standard ‘consumer label’ format in an industry known for using flexibility regarding disclosure formats to confuse consumers.”