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In a major victory for Jenner & Block client Sorenson Communications, Inc., the U.S. Court of Appeals for the Tenth Circuit sustained Sorenson’s constitutional and statutory challenges to multiple restrictions on the use of customer data and fund revenue by providers of telecommunications relay services (TRS), which includes video relay services provided to individuals who are deaf and hard of hearing.
The providers’ costs associated with TRS are compensated through a fund governed by the Federal Communications Commission (FCC). At issue in this case were restrictions articulated in two FCC declaratory rulings barring TRS providers from using “a consumer or call database to contact TRS users for lobbying or any other purpose” and from using revenues from the TRS fund to contact customers for lobbying or advocacy purposes. On behalf of Sorenson, a leading TRS provider, Jenner & Block argued that the restrictions unlawfully violated the U.S. Administrative Procedure Act and the Constitution.
Evaluating the FCC’s restriction on providers’ use of customer data under the test set out in Central Hudson Gas & Electric Corp. v. Public Service Commission of New York, 447 U.S. 557, 566 (1980), the court agreed that the restriction violated the First Amendment “as an impairment of providers’ right to engage in political and commercial speech” without any showing the restriction is narrowly tailored to advance a significant government interest.
“Nowhere in the Declaratory Rulings or the FCC’s brief to this court…does the FCC articulate the governmental interest to be served by the restriction, or why the restriction is narrowly tailored to not restrict more speech than necessary,” said the opinion.
The court also found the FCC’s restriction on using TRS revenues for lobbying to be “arbitrary and capricious” because the FCC failed to explain why lobbying was singled out for prohibition. The FCC’s justification that lobbying expenditures are inconsistent with the purpose of the TRS Fund “is inconsistent with the logic of a price cap-based compensation system,” said the court.
The Firm's team on this matter included Partner Michael B. DeSanctis, Associates Jonathan F. Olin and Jessica Ring Amunson and former Jenner & Block attorneys Donald B.Verrilli, Jr., Ian Heath Gershengorn, and Ginger D. Anders.
Please click here for the court’s opinion.