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US Regulatory Spotlight: Republicans' time running out on media ownership rules

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US Regulatory Spotlight: Republicans' time running out on media ownership rules

In this weeklyfeature, SNL Kagan provides a roundup of significant recent regulatory eventsin the U.S.

* Given that the three Democratic members of the FCC —Chairman Tom Wheeler, Commissioner Jessica Rosenworcel and Commissioner Mignon Clyburn— have already voted to approveWheeler's update of the commission's mediaownership rules, the Republicans on the commission are running outof time to make any changes. According to a July 22 Multichannel News report, even though Commissioner Michael O'Riellyand Commissioner Ajit Pai have yet to vote on the item, it will get automaticapproval on Aug. 3 as a result of the majority approval from the Democrats. Ifthey would like more time, the Republicans can request a one-week extension,which would be automatically granted. Wheeler's proposed update to theownership rules largely preserves existing restrictions, with just a fewtargeted modifications. Both O'Rielly and Pai have been sharply critical of theproposal, especially with regards to maintaining the newspaper/broadcastcross-ownership rule. Broadcasters have also been fighting the proposed update,arguing in a July 19 filingthat a key element of the local television ownership rule should be eliminated.Specifically, the National Association of Broadcasters said the eight voicesrule, which stipulates that at least eight independently owned and operatedfull-power broadcast TV stations must remain in a market following any mergerof stations, is "arbitrary and capricious."

* The Electronic Frontier Foundation July 21 that it filed suit against the U.S.government to challenge the anti-circumvention and anti-trafficking provisionsof the Digital Millennium Copyright Act. The provisions, according to thefoundation, make it unlawful for people to get around the software thatrestricts access to copyrighted material, such as films, songs and evencomputer code. This ban applies even where people want to make fair uses ofmaterials they have lawfully purchased.

* U.S. authorities said July 20 that they have charged ArtemVaulin — the alleged owner of Kickass Torrents, a popular illegal file-sharingwebsite — with criminal copyright infringement. "Vaulin is charged withrunning today's most visited illegal file-sharing website, responsible forunlawfully distributing well over $1 billion of copyrighted materials,"Assistant Attorney General Leslie Caldwell said in a . She noted that Vaulin hadallegedly tried to evade law enforcement by relying on servers located incountries around the world. Originally from Ukraine, Vaulin was arrested inPoland, though the U.S. will seek to extradite him. Kickass Torrents enabledusers to illegally reproduce and distribute hundreds of millions of copyrightedmovies, video games, TV shows, musical recordings and other electronic media.Several of the movies currently available for download and sharing on KATinclude "Captain America: Civil War" from 's Marvel, "Now YouSee Me 2" from Lions GateEntertainment Corp.'s Summit Entertainment, "Independence Day:Resurgence" from 21stCentury Fox Inc.'s 20th Century Fox and "Finding Dory"from Disney's Pixar, according to the complaint. Vaulin was charged with onecount of conspiracy to commit criminal copyright infringement, one count ofconspiracy to commit money laundering and two counts of criminal copyrightinfringement.

* Despite the FCC's recent decision not to adopt any newrules governing good faith negotiations, DISH Network Corp. CEO Charlie Ergen has not given uphis hope that the retransmission consent regime can be changed. Ergen noted duringa July 21 earnings conferencecall: "This is a consumer FCC. And they've talked about theconsumer almost from day one." And as far as Ergen is concerned, retransis the "No. 1 issue facing consumers today" in terms of video. WhileErgen acknowledged that retrans deals would ideally get negotiated withoutgovernment intervention, in cases where an impasse develops, he would likethere to be a mechanism to resolve disputes. "We've been very vocal aboutthe fact that baseball arbitration is a good way to do it. And by baseballarbitration I mean each side picks a number of what they think they should bepaying, and the arbitrator has to pick one of those two numbers," Ergennoted. DISH is currently involved in a major retrans dispute with

* Wheeler at the FCC named Howard Symons as the next FCCgeneral counsel. Symons, who has been serving on the FCC's Incentive AuctionTask Force since January 2014, is replacing Jon Sallet. In a July 19 , Wheeler saidSallet is leaving the commission to become the deputy assistant attorneygeneral for litigation in the Antitrust Division of the Department of Justice.In his new position as FCC general counsel, Symons will lead the FCC's legaladvisory office, which represents the commission in litigation, recommendsdecisions in adjudicatory matters and performs a variety of legal functionsregarding internal and other administrative matters.

* After a multiyear review, the U.S. Department of Justicetentatively concludedthat the decrees governing the songwriter royalties collected by AmericanSociety of Composers Authors and Publishers and Broadcast Music Inc. do notviolate antitrust law and so do not need to be modified. ASCAP and BMI may,therefore, continue to offer licenses providing rights to musical works.