Cable-Modem Odyssey Continues in Seattle

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The cable industry's Internet legal odyssey continues in Seattle Federal
Court Thursday in a case where federal deregulatory policies and millions of
dollars in local tax revenue are just some of the issues at stake.

A panel of the U.S. Court of Appeals for the Ninth Circuit is scheduled to
hear oral arguments on challenges to the Federal Communications Commission's
decision to classify cable-modem services as interstate information services
within the meaning of federal communications law.

Cable operators responded to the FCC's March 2002 ruling by refusing to
collect franchise fees on cable-modem revenue not only to save subscribers
millions of dollars, but also to avoid lawsuits designed to punish cable for
collecting fees on noncable services.

The three-judge panel is scheduled to include Judge Sidney R. Thomas. In June
2000, Thomas drafted the opinion stating that cable-modem service was not a
cable service but both an information service and a telecommunications service.
His ruling effectively barred local governments from imposing
Internet-service-provider-access requirements on cable.

The case was a victory for AT&T Corp. over the city of Portland, Ore.

Also on the panel is Judge Diarmuid F. O'Scannlain, who opposed the court's
March ruling that public-school children's recitation of the Pledge of
Allegiance violated the First Amendment's separation of church and state because
of the phrase "under God."

Filling out the panel is Judge Richard D. Cudahy, who is a senior judge
visiting from the Seventh Circuit, Ninth Circuit assistant circuit executive
David J. Madden said.

Each side will have 35 minutes. Arguing on behalf of the National Cable &
Telecommunications Association in support of the FCC's cable-modem
classification is Howard J. Symons of Mintz Levin Cohn Ferris Glovsky and Popeo
PC. FCC general counsel John Rogovin will anchor the agency's defense.

Opponents of the FCC's decision have splintered their 35 minutes six ways,
including nine minutes for EarthLink Inc. and five minutes for Verizon
Communications.

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