A former Federal Communications Commission bureau chief who played an integral role in shaping policies governing local telephone competition is now a senior vice president for federal regulatory strategy for SBC Communications, helping the telecom giant reshape the rules she helped draft.
Dorothy Attwood, former chief of the FCC's Wireline Competition Bureau, quit the agency on Sept. 15 of last year and began work at SBC Nov. 1.
Attwood has met with senior FCC officials a total of four times since she's been with SBC, including meetings with FCC Chairman Michael Powell's "senior legal adviser" on Jan. 22, Jan. 28 and Feb. 3 to discuss competition-related issues. On Jan. 31, she met with new FCC Commissioner Jonathan S. Adelstein. That meeting was also to discuss competition issues, according to FCC documents.
Adelstein is considered a key swing vote in the debate over new rules on how much regional telephone conglomerates such as SBC can charge competitors for using their equipment and networks. The vote was initially scheduled for Thursday, Feb. 13, but has been delayed until Feb. 20.
SBC and the other three regional Bell operating companies have been involved in a bitter fight with AT&T and other long distance companies over rules that stemmed from the Telecommunications Act of 1996. The law was supposed to create competition in local phone markets by forcing the Bell companies to open up their systems and equipment to competitors. Once the systems are declared open, the Bell companies are permitted to enter the long-distance market.
Initially, there was little competition in the local phone business, and many blamed the local Bells for blocking progress. SBC, the No. 2 local phone company in the U.S. after Verizon, has been among the most anti-competitive of the Bells. In fiscal 2002, the FCC assessed fines against SBC totaling $9.8 million. The fines included a $6 million penalty, the largest ever issued by the FCC, for "serious violations of our local competition rules" according to FCC Chairman Powell.
Despite the slow progress, long distance firms have made major inroads of late. Bell competitors have managed to take over about 11 percent of the local phone market with 8 million customers.
SBC and the other Bell companies claim the rules favor the long distance companies and they want them changed. At Thursday's meeting, the FCC was to vote on a new set of rules that would make it more difficult for long distance companies to get into the local phone business.
"The stakes are enormous," said Gene Kimmelman, co-director of Consumer Union's Washington, DC office. "What the commission decides could be a dagger in the heart of potential telecommunications competition or it could help keep fledgling competitors alive to fight another battle."
Attwood said when she left the agency, she was careful to ensure she would not violate federal "revolving door" laws and sought the opinion of the FCC General Counsel's office on post-employment rules. "I've been very careful in the approach I've taken," she told the Center for Public Integrity.
There is no indication that Attwood violated any laws by representing SBC's position before her old bosses, but Consumers Union's Kimmelman said if that's the case, the law should be changed. "If there is some loophole that allows this, it is the height of lunacy for ethics personnel and the leaders of these agencies to allow this to be happening," he said.
Attwood is one of several dozen FCC workers who have either gone from government to industry, or vice versa, over the past several years.
"Usually people are a little bit more subtle about this," Kimmelman said. "But to actually set foot in the place that soon after you leave a top policy role, it's just stunning. She's just symptomatic of the whole captured-agency problem."
According to ethics officials at the FCC, federal law places a number of restrictions on employees who quit and take a job in the private sector. Senior government workers can be subject to a "cooling off period" or even a lifetime ban against representing a private company against their former agency. But in Attwood's case, no action has been taken, nor is any expected because the FCC says she has not violated any rules.
An 'integral' role
Attwood joined the FCC in 1996 and served in the Policy and Program Planning Division of the Common Carrier Bureau, predecessor to the Wireline Competition Bureau. She worked as senor legal adviser to then-Chairman William Kennard and Chief of the Common Carrier Bureau's Enforcement Division. She became chief of the Common Carrier Bureau in July 2000.
Powell praised her service at the agency.
"She has played an integral role in the FCC's implementation of the Telecommunications Act of 1996, and in shaping our policies in the transition to a more competitive telecommunications environment," he said in a June 21 announcement.
Attwood said she stepped down as bureau chief on Aug. 1, moving into a position in the general counsel's office. She told the Center her last day was Sept. 15, but news accounts reported it as Oct. 15, a month later. While she was in the process of formally leaving the commission, she spoke with the general counsel's office in detail about what restrictions applied to her contacting her former workmates. She received a "written letter explaining the limitations of someone in my position," she said, and compiled a "list of proceedings in conjunction with former staffers before I left this is even before I took the job with SBC."
Attwood said she was out of work for a brief period, which was potentially difficult because she is the "breadwinner" for her family.
Within the letter of the law
According to the federal Office of Government Ethics, "A former employee is forever barred from representing another person or organization before a Federal Department, agency, or court on certain matters in which the former employee participated personally and substantially while working for the Government."
That's the harshest restriction. A lesser rule stipulates a two-year ban. "The post-employment statute provides that, for two years after terminating Government employment, a former employee may not represent another person or organization before a Federal department, agency, or court on certain matters which were pending under the employee's supervision during the last year of his Government service."
There is also a one year "cooling off period" for the most senior government officials.
Attwood does not fall under the cooling off rule because she was not senior enough. As for the lifetime and two-year bans, those prohibitions are for party-specific activity, usually related to some form of judicial or quasi-judicial proceeding. Attwood's representation of SBC before the FCC does not qualify because the rule being considered by the FCC affects an entire sector of industry, and not just her employer.
Attwood says she has been careful about meeting with FCC personnel, even though she is not legally required to restrict her visits. "I can recall three times going back, one in the nature of just saying hello to a new commissioner," she said, apparently referring to the meeting with Adelstein.
Attwood said she restrained herself from visiting the FCC and could have gone there "200 times" under the letter of the law.
Ethicists say revolving door laws are needed because it is not in the public interest for government employees to be able to peddle insider knowledge and personal contacts gained on the job to a new employer in the private sector. In addition, there is a concern that the government employee may rule favorably for their future employer in an attempt to get a job.
Frank Navran is principal consultant with the Ethics Resource Center in Washington. Navran directs more than 50 training seminars and workshops on organizational and business ethics for the center and its clients.
"What we advise people is there are two issues on the table one is whether you are out of compliance, and the other is whether you appear to be out of compliance. What's happening in the situation you describe, there's an appearance of impropriety even though no laws are being broken."
Navran said when governments try and legislate ethics, there are often unintended consequences. They may adhere to the letter of the law, but that's not necessarily a good thing.
"You've got a compliance mentality that says as long as its not illegal, it's OK," he said. "As a general principle, we really want to get people beyond using compliance, which is a minimum standard. What is the right thing to do here, rather than what does the law do?"
As far as enforcement, people are judged in the court of public opinion - if, that is, the information is out there.
After the Center's interview with Attwood, Barry Hutchison, executive director of public affairs at SBC, called the Center to discuss Attwood.
"For what it's worth, she is a person of utmost integrity. She goes out of her way to make sure there is not any problem in terms of her roles and that she is working within the letter of the law," he said. He went on the say she is "the breadwinner" for the family and said it would be a "shame" for her to be "tarred by living within the law."
"She has lived up to the letter of the law, and she has lived up to the spirit of the law," he said.
Attwood is not the only top FCC official who has recently gone to work for one of the big regional phone companies. After a short stint with a leading communications law firm, former FCC Chief of Staff Kathryn Brown last October became senior vice president for public policy development and international government relations for Verizon.
Far from the exception, Attwood appears to be the rule at an agency where employees regularly hop back and forth between government service and private industry.
Before being named an FCC commissioner in 2001, Kathleen Abernathy was vice president of public policy at BroadBand Office Communications, Inc., a start-up telecommunications venture that has since gone bankrupt. Before that, she was a partner at Wilkinson Barker Knauer, a leading telecommunications law firm. She also had stints as vice president for regulatory affairs at U.S. West, Inc. and as vice president for federal regulatory issues at AirTouch Communications, Inc.
In addition to her experience in the private sector, Abernathy held several positions at the FCC at various times. She was a telecommunications legal advisor to former FCC Chairman James H. Quello, legal advisor to former Commissioner Sherrie P. Marshall, and special assistant to the FCC's general counsel.
Most of Abernathy's legal advisors also came directly from the private sector.
Senior Legal Advisor Matthew Brill represented wireless and wireline carriers and Internet service providers before the FCC for Wilmer, Cutler & Pickering.
Stacy Robinson, who advises Abernathy on mass media issues, was senior counsel for Discovery Communications Inc., parent company of the Discovery Channel. Senior Counsel Jennifer Manner, who advises Abernathy on wireless, technology and international issues, was director of international alliances at bankrupt telecom giant Worldcom.
There is a similar situation in the office of FCC Chairman Michael Powell.
Powell's senior legal advisor on cable matters, Susan Eid, was vice president of federal relations for Media One Group, one of the country's largest cable companies.
Powell's Chief of Staff Marsha McBride came back to the FCC after a stint as vice president of government relations for the Walt Disney Co. Before ducking through the revolving door to join Disney, McBride held several top staff positions within the FCC. She originally joined the FCC in 1991, after a six-year career as a communications lawyer in Washington.
John Muleta, who last week took over as chief of the agency's powerful Wireless Telecommunications Bureau, came directly from Source 1 Technologies LLC, where he was president and CEO.
Muleta previously worked at the FCC from 1994-1998, serving in the Common Carrier Bureau and the Office of Plans and Policy. He served as deputy bureau chief there and was chief of the Enforcement Division. After leaving the FCC, Muleta worked at PSINet, Inc. He began his career at GTE Corp. and later worked at Coopers & Lybrand Consulting, LLC, before joining the FCC in 1994.
When Attwood left the Wireline Competition Bureau, she was replaced by Washington attorney William Maher. Maher came to the FCC from the telecommunications law firm of Halprin, Temple, Goodman & Maher. Before that, he was at the U.S. Department of Commerce assisting on telecommunications issues. Prior to that job, he was at the FCC as a special counsel for competitive issues.