Gale Encyclopedia Of American Law 3Rd Edition Volume 9 P51 pptx

they are permitted to stop paying their share of school tax. Uniformity The principle of uniformity of taxation bears a close relation to the concept of equality because similar items are taxed equally only if the mode of assessment is the same or uniform. A tax that is levied upon property must be in proportion or according to its value, ordi- narily determined as its fair cash or FAIR MARKET VALUE . This requirement protects equality and uniformity of taxation by preventing ARBITRARY or inconsistent methods of determining how much tax is due. This requirement applies only to property taxes, not to excise taxes. FURTHER READINGS Reid, John Phillip, 2003. Constitutional History of the American Revolution: The Authority to Tax. Madison: University of Wisconsin Press. CROSS REFERENCES Customs Duties; Estate and Gift Taxes; Internal Revenue Service; Tax Rate; Taxpayer Bill of Rights. Tea Party Movement O B ne of the catalysts for the American Revolu- tion was the imposition of British taxes on the American colonists. The battle cry of “No Taxation without Representation” struck a nerve. The Boston Tea Party of 1773, where coloni sts destroyed three shiploads of taxed tea that was to be returned to Great Britain, has been adopted by succeeding generations of Americans who have opposed government taxation without representation. One example is the tea party movement, which began in 2009. The tea party movement can be traced to the 2008 presidential campaign of congressman Ron Paul (R-Tex.), whose conservative Republican philosophy led him to call for the extinction of the Federal Reserve system and for a drastic shrinking of the federal government. Though Paul had no chance of winning the Republican nomination, his followers remain active and vocal in their criticism of the political system. In addition, the election of Barack Obama as president coincided with the bailout of the U.S. banking system following its dramatic near-collapse in September 2008. Though many Republicans voted for the bailout, most conservatives were outraged. After President Obama proposed, and Congress enacted, a massive economic stimulus plan in February 2009, conservative radio commentators such as Rush Limbaugh fanned the flames of discontent. By mid-February small protests against the stimulus package had taken place in Denver and Washington. When Rick Santelli, a cable news business commentator, attacked the mortgage refinancing provisions of the l aw on a February 19 broadcast from C hicago, he mentioned the idea o f a Chicago “Tea Party.” Within hours the idea of a tea party movement was born, and on February 27 protests were held in 40 cities around the United States. The tea party movement continued to grow. On April 15 anti-tax demonstrations were held in approximately 350 cities. Turnouts varied and critics questioned how many people actually participated. Nevertheless, liberal and conservative analysts seemed to agree that more than 300,000 people marched that day. When a box of tea bags was thrown over the White House fence, the Secret Service moved protesters to a different location. On September 12, more tea party protests took place, including a large gathering at the U.S. Capitol building. The tea party movement is a contemporary example of A merican populism. Individuals and small business owners objected to government bailouts of large banks, the U.S a uto industry, and irresponsible homeowners who faced foreclosure because they failed to live within their means. Some protesters attacked former President George W. Bush and the Republican majorities in Congress during his time in office for profligate spending, but most reserved their anger for President Obama and congressional Democrats. By the end of 2009, it was unclear where the tea party movement was headed. Critics contended that it was an “astroturf” movement that had been manufactured by conservative lobbyists, but others believed it was a genuine movement fueled by middle-class discontent. GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 488 TAXATION TAXING COSTS The designation given to the process of determin- ing and charging to the losing party in a legal action the expenses involved in initiating or defending the action, to which the successful side is lawfully entitled. CROSS REFERENCE Costs. TAXPAYER BILL OF RIGHTS A federal or state law that gives taxpayers procedural and substantive protection when dealing with a revenue department concerning a tax-collection dispute. Perceived abuses by the federal INTERNAL REVENUE SERVICE (IRS) during tax audits led to the enactment of the Omnibus Taxpayer Bill of Rights in 1988, Pub. L. No. 100-647, 102 Stat. 3342. A second set of provisions was enacted in 1996 in the Taxpayer BILL OF RIGHTS II, Pub. L. No. 104-168, 110 Stat. 1452 to give taxpayers increased leverage in dealings with the IRS. Congress followed those enactments by passing the Internal Revenue Service Restructuring and Reform Act of 1998 (also known as the Taxpayer Bill of Rights III), Pub. L. No. 105- 206, 112 Stat. 685. The original 1988 act also spurred many states to enact similar taxpayer bills of rights. The rights given to taxpayers under these federal acts do not reduce the chance of being audited or diminish IRS’s authority to penalize taxpayers for inaccuracies or cheating on their returns. Nevertheless, the provisions correct many of the perceived abuses in IRS auditing and collection procedures. The bill of rights seeks to relieve taxpayers from the unfettered discretion of IRS agents. Congress stated that the aim of the 1988 act was “to inject reason and protection for individual rights into the tax collection process.” The bill of rights requires the IRS to explain the audit and collection process to the taxpay er before any initial audit or collection in terviews and to include on all tax notices a description of the basis for taxes, interest, or penaltie s due. The bill also requires the IRS to inform taxpayers of their rights, including the right to be represented by an attorney or tax accountant, whenever an audit notice is sent. The bill allows the taxpayer to make an audio recording of the interview with the IRS agent, provided prior notice is given. An actual audit interview can be stopped, WITHOUT PREJUDICE, so that the taxpayer can consult with an attorney or accountant. Another key provision prohibits the IRS from imposing quotas or goals on agents with respect to the number of returns they audit and the amount of taxes and penalties collected. The 1988 act created the Office of Taxpayer Ombudsman, which served as the primary advocate for taxpayers within the IRS. The 1996 act shifted this role to the newly established Office of the Taxpayer Advocate. This office helps taxpayers resolve problems with the IRS, identifies areas in which taxpayers have problems in dealings with the IRS, proposes changes in the administrative practices of the IRS, and suggests potential legislative changes that may reduce these problems. To ensure independence from the IRS, the Tax- payer Advocate reports directly to Congress twice a year. The Taxpayer Advocate also has br oad authority to issue Taxpayer Assistance Orde rs. These orders can release property or require the IRS to cease any action, or refrain from taking any action, that will cause significant hardship as a result of the administration of the internal revenue laws. Under the bill of rights, before the IRS can put a LIEN on or seize taxpayer property, it must give the taxpayer thirty days’ notice instead of the previous ten days’ notice. Taxpayers are permitted to sue the IRS for damages suffered as a result of tax-collection or property-seizure actions or refusals to release a lien; they can be awarded court costs and legal and administra- tive fees if they win an administrative or court action against the IRS. Under the bill of rights, the IRS is autho- rized to make installment agreements with taxpayers to alleviate the burden on a taxpayer who would experience financial hardship if forced to make a lump-sum payment. The IRS must give 30 days’ notice before altering, modifying, or terminating a previously agreed- upon installment agreement, unless the change is caused by a determination that the collection of tax is in jeopardy. Another provision of the law states that if the IRS believes additional taxes are owed, the agency must send the taxpayer a written notice that explains and identifies all amounts due. The IRS must also describe the procedures GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION TAXPAYER BILL OF RIGHTS 489 that it will use to collect any amounts due. Previously, the IRS generally explained the basis for a tax deficiency but was not required to explain penalties or how they would be collected. Instead, the IRS simply sued the taxpayer. The bill of rights gives the IRS authority to abate interest for delays or unreasonable errors caused by nondiscretionary procedural acts of the IRS or by IRS managerial acts such as loss of records by the IRS or transfers, extended illnesses, leave, or professional training of IRS personnel. The 1998 bill of rights resulted from a series of hearings held before Congress in 1996 and 1997. The 1998 act added several provisions related to tax-collection activities of the IRS, including a provision that requires the IRS to follow certain guidelines established in the Fair Debt Collection Practices Act, 15 U.S.C.A. § 1692 et seq. FURTHER READINGS Hudson, David M., and Stephen A. Lind. 2007. Federal Income Taxation. 10th ed. St. Paul, Minn.: Thomson/ West. Mumford, Ann. 1997. “The New American Bill of Rights.” British Tax Review (November-December). Petersen, Scott. 1997. “The Rights of Third-Party Taxpayers under the Taxpayers’ Bill of Rights.” Journal of Small and Emerging Business Law 1 (winter). U.S. Department of the Treasury. 1997. Taxpayer Bill of Rights 3 and Tax Simplification Proposals. Chicago: CCH Incorporated. CROSS REFERENCES Income Tax; Taxation. TAXPAYER’S SUIT An action brought by an individual whose income is subjected to charges imposed by the state or federal government, for the benefit of that individual and others in order to prevent the diversion of public funds in violation of a public right. Because every taxpayer of a town has an interest in the preservation of an orderly government, many state laws grant individual taxpayers the right to sue town officers, boards, or commissions to recover money that has been wrongfully spent. In order to bring such suit, however, several criteria must be met. The plaintiffs must have standing as taxpayers of the governmental unit in question. They must also show that the expenditure being challenged is unlawful and not in the public’s economic interest. For example, in 1968 several citizens filed suit against Wilbur Cohen, who was then the Secretary of Health, Education and Welfare. They argued that the use of federal funds for religious schools violated the Establishmen t Clause of the FIRST AMENDMENT. At the district court level, plaintiffs were found not to have standing, but on appeal to the U.S. Supreme Court, Chief Justice EARL WARREN found in favor of them and established a two-pronged test: to BRING SUIT, PLAINTIFF taxpayers must “allege the unconstitutionality only of exercises of congres- sional power under the taxing and spe nding clause of Art. I, § 8, of the Constitution” and also that “the challenged enactment exceeds specific constitutional limitations upon the exercise of the taxing and spending power and not simply that the enactment is generally beyond the powers delegated to Congress by Art. I, § 8” (Flast v. Cohen, 392 U.S. 83 [1968]). v TAYLOR, ZACHARY Zachary Taylor served as the twelfth president of the United States from 1849 until his death in 1850. A famous military general, Taylor was an apolitical leader who accomplished little during his sixteen months in office. He does have the distinction of being one of the two military heroes of the Mexican War, and the last Whig president. Taylor was born on November 24, 1784, in Orange County, Virginia, the son of a lieutenant colonel who had been on George Washington’s Revolutionary War staff. The family moved to Louisville, Ky., in 1785, where Zachary’s father became a collector of customs and an influential man. Poorly educated by private tutoring, young Taylor was intended for an agricultural life on the family plantation, but the death of an elder brother allowed him to enter the Army in 1808. Taylor was commissioned as a first lieuten- ant in the infantry that same year by President THOMAS JEFFERSON and was assigned to Gen. James Wilkinson’s command at New Orleans. He quickly emerged as a military hero during the WAR OF 1812 while serving under General WILLIAM HENRY HARRISON. Taylor also served in the Black Hawk War (1832) and the Second Seminole War (1835-1842). On May 15, 1838, Taylor was named commanding general of all U.S. forces in Florida. GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 490 TAXPAYER’ SSUIT In 1845, soon after the ANNEXATION of Texas, President JAMES K. POLK ordered Taylor and an army of four thousand men to the Rio Grande. Border hostilities with Mexico over the bound- ary between the two countries escalated into full battles in May of 1845. Taylor’s troops defeated an invading Mexican army at the Battles of Palo Alto and Resaca de la Palma. That same month, the United States declared war on Mexico. Taylor and his army invaded Mexico and advanced to Monterrey, capturing the city in late September. His military career was put in doubt, however, when a letter became public in which Taylor criticized President Polk and his secretary of war, William L. Marcy. An angry Polk could not relieve the popular war hero of his command, but he stripped Taylor of his best troops and ordered him to adopt a defen- sive posture. Taylor, who was nicknamed “Old Rough and Ready,” disobeyed Polk’sordersand defeated a Mexican army that outnumbered his troops by four to one at the Battle of Buena Vista in February 1847. This stunning victory guaranteed Taylor the status of national hero. The WHIG PARTY nominated Taylor as its presidential candidate in 1848, even though Taylor had no interest in politics (he had never voted in an election) and was a slave owner. Taylor defeated the Democratic candidate, Lewis Cass, in the November general election. Taylor’s brief service as president was unremarkable. Having no political backgrou nd, Taylor was unprepared for the give-and-take of Washington politics. The biggest issue facing him was statehood fo r California and New Mexico, which had been acquired from Mexico as a result of the war. Although he owned slaves, Taylor was opposed to the expansion of SLAVERY into the new territories, a position that alienated Southern Whigs and Democrats in Congress. When California voted to prohibit slavery, the South opposed its admission to the Union. Attempts by Senator HENRY CLAY of Kentucky to negotiate a compromise were rebuffed by Taylor. As this political conflict unfolded in the summer of 1850, Taylor contracted cholera. He died on July 9, 1850 , in Washington, D.C. Taylor was succeeded by Vice President MILLARD FILLMORE, who quickly agreed to resolve the Mexican territories issue with the COMPRO- MISE OF 1850. This act admitted California into the Union as a free state, gave the territories of Utah and New Mexico the right to determine the slavery issue for themselves at the time of Zachary Taylor 1784–1850 ▼▼ ▼▼ 17751775 18501850 18251825 18001800 ◆ ❖ 1775–83 American Revolution 1784 Born, Orange County, Va ◆ 1808 Enlisted in the U.S Army 1812–14 War of 1812 1832 Distinguished himself during Black Hawk War ◆ 1837 Promoted to brigadier general after his victory at the Battle of Lake Okeechobee ◆ 1845 Texas admitted as 28th state of the Union 1846–48 Mexican War 1850 Died, Washington, D.C. 1849–50 Served as U.S. president 1835–42 Second Seminole War in Florida ◆ 1847 Defeated Mexican army at the Battle of Buena Vista ❖ Zachary Taylor. LIBRARY OF CONGRESS LET US INVOKE A CONTINUANCE OF THE SAME PROTECTING CARE WHICH HAS LED US FROM SMALL BEGINNINGS TO THE EMINENCE WE THIS DAY OCCUPY WHICH SHALL ACKNOWLEDGE NO LIMITS BUT THOSE OF OUR OWN WIDE -SPREAD REPUBLIC. —ZACHARY TAYLOR GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION TAYLOR, ZACHARY 491 their admission to the Union, outlawed the slave trade in the District of Columbia, and gave the federal government the right to return fugitive slaves in the FUGITIVE SLAVE ACT (9 Stat. 462). FURTHER READINGS Hamilton, Holman. 1978. The Three Kentucky Presidents— Lincoln, Taylor, Davis. Lexington: Univ. Press of Kentucky. TEA PARTY MOVEMENT See TAXATION. TEAPOT DOME SCANDAL The presidential administration of WARREN G. HARDING, from 1921 to 1923, was characterized by scandal and corruption, the most controver- sial of which was the Teap ot Dome oil scandal. Conservation was a popular cause through- out the first quarter of the twentieth century and was encouraged by various presidents. As a result, several oil reserves for the exclusive use of the U.S. Navy were established in Wyoming and California. The oil was kept in storage places called domes, one of which, located near Casper, Wyoming, was christened Teapot Dome due to a rock formation in the area that resembled a teapot. Although many politicians favored the establishment of the oil reserves, others believed they were superfluous. One opponent of the oil policy was Senator Albert B. Fall of New Mexico, who sought to make the reserves acc- essible to private industry. In 1921 Senator Fall was selected as Secretary of the Interior in the Harding cabinet. Authority over the oil fields was transferred from the Department of the Navy to the INTERIOR DEPARTMENT, with the consent of Edwin Denby, Secretary of the Navy. Fall was in a position to lease the oil reserves, without public bidding, to private parties. In 1922 Harry F. Sinclair, president of the Mammoth Oil Com- pany, received rights to Teapot Dome, and Edward L. Doheny, a friend of Fall and pro- minent in the Pan-American Petroleum and Transport Company, leased the Elk Hills fields in Californ ia. Fall received approximately $400,000 in exchange for his favoritism. Senator Thomas J. Walsh of Montana initiated a Senate investigation of the oil reserve lands at the recommendation of Senator ROBERT M . LAFOLLETTE of Wisconsin. Eventually the U.S. Supreme Court declared the leases inoperative, and the oil fields at Teapot Dome and Elk Hills were returned to the U.S. government. Sinclair served nine months in prison for CONTEMPT of court, but both he and Doheny were found not guilty of BRIBERY. Fall, who had left the cabinet in 1923, w as found guilty in 1929 of accepting bribes; his punishment was one year in prison and a fine of $100,000. President Harding died in office in 1923, never aware of the notoriety of his administration. FURTHER READINGS Stratton, David H. 1998. Tempest over Teapot Dome: The Story of Albert B. Fall. Norman: Univ. of Oklahoma Press. TELECOMMUNICATIONS The transmission of words, sounds, images, or data in the form of electronic or electrom agnetic signals or impulses. From the introduction of the telegraph in the United States in the 1840s to the present- day Internet computer network, telecommu- nication has been a central part of American culture and society. Telephones, radios, broad- cast television, CABLE TELEVISION, satellite televi- sion, fax machines, cellular telephones, and computer networks have become integral parts of everyday life. As telecommunication technol- ogy advanced, the telecommunications industry Albert B. Fall (left), U.S. secretary of the interior, and Harry F. Sinclair, president of the Mammoth Oil Company, received prison terms for their roles in the Teapot Dome scandal, with Fall convicted of accepting bribes and Sinclair for contempt of court. BETTMANN/CORBIS. GALE ENCYCLOPEDIA OF AMERICAN LAW, 3 RD E DITION 492 TEA PARTY MOVEMENT became more complicated. As a result, federal and state governments attempted to regulate the pricing of telecommunication systems and the content of transmitted mate rial. The Telecom- munications Act of 1996 (Pub. L. No. 104-104) deregulated much of the telecommunication industry allowing competition in markets previously reserved for government-regulated monopolies. Telegraph The first telegraph system in the United States was completed in 1844. Originally used as a way of managing railroad traffic, the telegraph soon became an essential means of transmitting news around the United States. The Associated Press was formed in 1848 to pool telegraph expenses; other wire services soon followed. Many telegraph companies were formed in the early years of the business, but by 1856 Western Union Telegraph Company had be- come the first dominant national telegraph system. In 1861 it completed the first transcon- tinental line, connecting San Francisco first to the Midwest and then on to the East Coast. The International Telegraph Union was formed in 1865 to establish standards for use in interna- tional communication as worldwide interest increased in applications of the telegraph. In 1866 the first transatlantic cables were com- pleted. The telegraph era came to an end after WORLD WAR II, with the advent of high-speed transmission technologies that did not use telegraph and telephone wires. By 1988 Western Union was reorganized to handle money transfers and related services. Telephone Systems The invention of the telephone in the late nineteenth century led to the creation of the American Telephone and Telegraph Company (AT&T). The company owned virtually all telephones, equipment, and long-distance and local wires for personal and business service in the national telephone system. Smaller compa- nies seeking a part of the long-distance tele- phone market challen ged AT&T’s monopoly in the 1970s. In 1982 the U.S. JUSTICE DEPARTMENT allowed AT&T to settle a lawsuit alleging antitrust violations because of its monopolistic holdings. AT&T agreed to divest itself of its local operating companies by January 1, 1984, while retaining control of its long-distance, research, and manufacturing activities. Seven regional telephone companies (known as the Baby Bells) were given responsibility for local telephone service. Other companies now compete with AT&T to provide long-distance service to telephone customers. In an effort to spur competition the Tele- communications Act of 1996 allowed the seven regional phone companies to compet e in the long-distance telephone market. The act also permitted AT&T and other long-distance car- riers, as well as cable companies, to sell local telephone service. Local telephone rates are regulated by state commissions, which also work to see that the regional telephone companies provide good maintenance and services. The use of a tele- phone for an unlawful purpose is a crime under state and federal laws, as is the WIRETAPPING of telephone conversations. In 2002 the U.S. SUPREME COURT issued two rulings that had a significant impact on large regional telephone companies. The first was Verizon Communications v. FCC 535 U.S. 467, 122 S.Ct. 1646 , 152 L. Ed. 2d 701, which had beginnings in the 1990s. Under the 1996 Telecommunications Act, multiple local ex- change carriers (LECs) are allowed to compete in the same market. Incumbent LECs, or ILECs, are those that already have a presence in a market. Competing LECs (CLECs) are provi- ders that want to enter an ILEC’s market. The ILECs are required to share their telecommu- nications network with the CLECs for a GOOD FAITH negotiated price (47 U.S.C.A. Secs. 251– 52). They must form a written agreement; if there are points of contention in the agreement, they must be submitted for binding ARBITRATION to the state utility commission. That decision may be appealed to a federal district court if either side believes that it constitutes a violation of the act. Several LECs and state utility commissions challenged the FEDERAL COMMUNICATIONS COMMIS- SION (FCC), the federal agency charged with regulating communications, over the way it mandated pricing formulas. The Eighth Circuit Court of Appeals side d with the plaintiffs in Iowa Utilities Board v. FCC, 120 F.3d 753 (8th Cir. 1997). The Supreme Court reversed the Eighth Circuit’s decision, concluding that the GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION TELECOMMUNICATIONS 493 FCC was within its rights to establish a pricing methodology. The court ordered the appellate court to determine whether that methodology met the requirements of the 1996 act (AT&T Corp. v. Iowa Utilities Board, 525 U.S. 366, 119 S. Ct. 721, 142 L. Ed. 2d 835 (1999). In Iowa Utilities Board v. FCC, 219 F.3d 744 (8th Cir. 2000), the appellate court ruled that the FCC pricing rules were invalid. On appeal, the Supreme Court again reversed the Eighth Circuit, observing that the FCC’s methodology had been designed so that smaller companies could enter and compete more easily in local phone markets. The ILECs preferred a methodology that would have in- creased the amount they were allowed to charge the CLECs. The increase would have amounted to billions of dollars in charges. Moreover, the court held that the FCC has the authority to force ILECs to combine leased elements upon request by a CLEC. These include local, long- distance, Internet, and pay-per-call information and entertainment services. In a decision that involved two cases, the Supreme Court ruled that state utility commis- sions and individual commissioners may be sued in federal court by long-distance phone companies that disagree with the way they are enforcing federal laws (Verizon Maryland v. Public Service Commission of Maryland, 535 U.S. 635, 122 S. Ct. 1753, 152 L.Ed. 2d 871 [2002], Mathias v. Worldcom Technologies, Inc., 535 U.S. 682, 122 S. Ct. 1780 [Mem], 152 L.Ed.2d 911 [2002]). In the first of these cases, Bell Atlantic Maryland, the region’s ILEC, had refused to pay reciprocal compensation to Worldcom, a CLEC. The second case involved the same issue , except that the ILEC in question was Ameritech Illinois. Under the 1996 Telecommunications Act, local calls trigger the ILEC’s obligation to offer reciprocal compensation, whereas long- distance calls do not. The Maryland and Illinois ILECs refu sed to offer reciprocal compensation when their customers made phone calls to Internet service providers that were customers of the CLECs, arguing that a call to an Internet service provider is a long-distance call even though the number may be local. They reasoned that a phone call to another person connects the caller to that person, but a connection to the Internet gives the caller access to websites and information around the world—hence, a long- distance call. The Maryland Public Service Commission and the Illinois Commerce Commission, re- spectively, rejected this argument. The ILECs sued them in federal court, along with individ- ual commissioners and the CLECs in question. The federal appeals courts upheld the utility commission’s decisions. One of the argum ents made by the ILECs was that federal courts had no jurisdiction over these cases under the Telecommunications Act. However, the Su- preme Court held that the 1996 Telecommuni- cations Act is a federal law, and as such, federal courts shou ld be able to enforce the law by hearing cases brought against state regulators. As for whether individual commissioners could be sued, the court cited Ex parte Young, 209 U.S. 123, 28 S.Ct. 441, 52 L.Ed 714 (1908), and said that state officials can be sued in their official capacity as long as the suit alleges an ongoing violation of federal law, and as long as the relief sought can be characterized as prospective (looking toward the future). The assumption that only telephone com- panies, wired and wireless, could deliver phone service was shattered with the introduction of Voice over Internet Protocol (VoIP) by Internet service providers. In 2004 VoIP was introduced for consumers with broadband, high-speed Internet connections. In a report by Pike & Fischer’s Broadband Advisory Services, it is estimated that 30 million households in the U.S. will be connected to VoIP by 2010. Radio In the early twentieth century, radio was regarded primarily as a device to make maritime operations safer and a potential advancement of military technology. During WORLD WAR I, entrepreneurs began to recognize the commer- cial possibilities of radio. By the mid-1920s, commercial radio stations were operating in many parts of the United States and owners began selling air time for advertisements. The Federal Radio Commission was created in 1927, to assign applicants designated frequencies under specific engineering rules and to create and enforce standards for the broadcasters’ privilege of using the public’s airwaves. The commission later became the Federal Communications Commission (FCC), which was established by the Communications Act of 1934 (47 U.S.C.A. § 151 et seq.). The FCC issues licenses to radio and television stations, which permit the stations to use specific frequencies GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 494 TELECOMMUNICATIONS to transmit programming. Licenses are issued only on a showing that public convenience, interest, and necessity will be served and that an applicant satisfies certain requirements, such as citizenship, good character, financial capability, and technical expertise. Before 1996 the FCC restricted persons or entities from acquiring excessive power through ownership of a number of radio and television facilities. The rule was based on the assumption that if one person or company ow ned most or all of the media outlets in an area, the diversity of information and programming on these stations would be restricted. The Telecommunications Act of 1996 eliminated the limit on the number of radio stations that one entity may own nationally. The FCC was also directed to reduce the restrictions on locally owned radio stations. Congress deter- mined that less regulation was in the public interest. In 2007 the FCC enacted new media ownership regulations that allowed broad- casters in the 20 largest U.S. cities to also own a newspaper. The regulation permitted compa- nies to own more than one TV station. In markets where there were at least five stations, a company could own two stations; a company could own three TV stations where there were 18 or more stations. In addition, the FCC seeks to prohibi t the broadcast of obscene and indecent material. The Supreme Court has upheld regulations banning obscene material because OBSCENITY is not pro- tected by the FIRST AMENDMENT. It also permits the FCC to prohibit material that is “patently offensive,” and either “sexual” or “excretory,” from being broadcast during times when chil- dren are presumed to be in the audience (FCC v. Pacifica Foundation, 438 U.S. 726, 98 S. Ct. 3026, 57 L. Ed. 2d 1073 [1978]). Television The commercial exploitation of television did not begin in the United States unt il the la te 1940s. The FCC followed its example from radio and established licensing procedures for stations seeking permission to transmit televi - sion signals. It became the oversight body for the U.S. television industry. The FCC has applied to television a pro- hibition similar to that imposed on radio against the broadcast of obscene and indecent mate- rial. For purposes of parental control, the Telecommunications Act of 1996 mandated the establishment of an advisory committee to rate video programming that contains indecent material. The act also stated that by 1998, new television sets had to be equipped with a so- called V-chip to allow parents to block programs with a predesignated rating for sex and violence. In 2004 the FCC changed its 30-year policy on the broadcasting of indecent language. A broadcast television or radio station could be subjected to fines and revocation of its federal license i f it broadcast someone speaking an obscenity, even if the word was used just once. Prior to this change, the FCC had a long-standing policy against the use of indecent language, but it did not prosecute one-time occurrences. The Supreme Court in Federal Communications Commission v. Fox Television Station, __U.S.__, 129 S.Ct. 1800, 173 L.Ed.2d 738 (2009), found the policy legitimate. The court did not address whether the FCC policy was constitutional under the First Amendment. Cable television became a viable commercial form of telecommunication in the 1980s. Both the FCC and local governments had an interest in regulating cable systems, with municipalities awarding a cable system franchise to one vendor. Cable operators negotiated system requirements and pricing with local governments, but federal law imposed some restrictions on rates to con- sumers. Concerns about rate regulation led Congress to enact the Cable Television CON- SUMER PROTECTION and Competition Act of 1992 (Pub. L. No. 102-385). The act gave the FCC greater contro l of the cable television industry and set rate struc tures to control the price of cable subscriptions. The Telecommunications Act of 1996 reversed the 1992 act by ending all rate regulation. The act also allowed the seven regional telephone companies to compete in the cable television market to end the monopoly that cable systems had enjoyed under the previous regulatory scheme. For customers who cannot obtain cable television programming, the transmission of television signals by satellite has been a practical solution. Since their introduction in the 1990s, direct broadcast satellite systems have competed with cable television systems, offering high- quality video and audio signals, and access to a wide range of programming. Congress enacted the Digita l Television and Public Safety Act of 2005 to require all television GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION TELECOMMUNICATIONS 495 broadcast stations to end the transmission of programming in analog format and to begin broadcasting only digital signals. Funds were provided to underwrite digital converter boxes that would allow viewers to use their analog- only television sets. The change was made in June 2009. Transmission of Digital Data In the 1980s and 1990s, the use of digital data transmission revolutionized the communica- tion of words, images, and sounds. Computer- driven means of telecommunication have made possible electronic mail ( E-MAIL), the sharing of computer files, and, most importantly, the Internet. The Internet is a network of computers linking the United States with the rest of the world. Originally developed as a way for U.S. research scientists to communicate with each other, by the mid-1990s the Internet had become a popular form of telecommunication for per- sonal computer users. Written text represents a significant portion of the Internet’s content, in the form of both e-mail and articles posted to electronic discussion forums. In the mid-1990s, the appearance of the World Wide Web made the Internet even more popular. The Web is a multimedia interface that allows for the trans- mission of what are known as Web pages, which resemble pages in a magazine. In addition to combining text and pictures or graphics, the multimedia interface makes it possible to add audio and video components. Together these various elements have made the Internet a medium for communication and for the retrieval of information on virtually any topic. The federal government has attempted to regulate this form of telecommunication. Con- gress passed the Electronic Communications Privacy Act of 1986 (ECPA) (18 U.S.C.A. § 2701 et seq. [1994]), also known as the Wiretap Act, which made it illegal to read private e-mail. The ECPA extended to e-mail most of the protection already granted to conventional mail. This protection, however, has not been extended to all e-mail transmitted in the workplace. A controversial issue in the workplace is whether an employer should be able to monitor the e-mail messages of its employees. An employer has a strong legal and financial motive to prohibit unauthorized and inappropriate use of its e-mail system. Under the Wiretap Act, a company is not restricted in its ability to review messages stored on its internal e-mail system. In addition, interception of electronic communi- cations is permitted when it is done in the ordinary course of business or to protect the employer’s rights or property. This exception would apply when, for example, an employer has reasons to suspect that an employee is using the E-mail system to disclose information to a competitor or to send harassing messages to a coworker. Finally, the prohibitions of the Wiretap Act do not apply if the employee whose messages are monitored has explicitly or im- plicitly consented to such monitoring. Congress sought to curb the transmission of indecent content on the Internet and other computer network telecommunications systems by enacting the Communications Decency Act (CDA) (47 U.S.C.A. § 223(a)-(h)), as part of the Telecommunications Act of 1996. The CDA made it a federal crim e to use telecommunica- tions to transmit “any comment, request, sugges- tion, proposal, image, or other communication which is obscene or indecent, knowing that the recipient of the communication is under 18 years of age, regardless of whether the maker of such communication placed the call or initiated the communication.” It includes penalties for violations of up to five years imprisonment and fines of up to $250,000. In Reno v. American Civil Liberties Union, 521 U.S. 844, 117 S. Ct. 2329, 138 L. Ed. 2d 874 (1997), the Supreme Court struck down the “indecent” provi sion as a violation of the First Amendment right of free speech. Cong ress enacted a modified law that was struck down in Ashcroft v. American Civil Liberties Union, 535 U.S. 564, 122 S. Ct. 1700, 152 L. Ed. 2d 771 (2002). Congress then enacted the Prosecutorial Remedies and Other Tools to end the Exploita- tion of Children Today Act of 2003, 117 Stat. 650. The law focused on the pandering of CHILD PORNOGRAPHY , i.e., the offering or soliciting of supposed pornographic images. The Supreme Court, in U.S. v. Williams, __U.S.__, 128 S.Ct. 1830, 170 L.Ed.2d 650 (2008), upheld the statute. The court found that the law only “prohibits offers to provide and requests to obtain child pornography.” The law did not require the “actual existence” of child PORNOG- RAPHY . Rather than focusing on the underlying material the law targeted the “collateral speech that introduces such material into the child- pornography distribution network.” GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 496 TELECOMMUNICATIONS Standards in Telecommunication Certain telecommunication methods have be- come standards in the telecommunication in- dustry because devices with different standards cannot communicate with each other. Standards are developed either through the widespread use of a particular method or by a standard-setting organization. The International Telecommuni- cation Union, a UNITED NATIONS agency that sits in Geneva, Switzerland, and one of its opera- tional bodies, the International Telegraph and Telephone Consultative Committee, play a key role in standardizing telecommunication meth- ods. For example, the committee’s standards for the fax machine that were adopted in the 1980s facilitated the dramatic increase in use of this form of telecommunication. FURTHER READINGS Barron, Jerome, and Thomas Dienes. 2006. First Amendment Law in a Nutshell. 6th ed. St. Paul, MN: Thomson West. Carter, T. Barton. 2006. Mass Communications Law in a Nutshell. 6th ed. St. Paul, MN: West Group. Zarkin, Kimberly, and Michael Zarkin. 2006. The Federal Communications Commission. New York: Greenwood Press. CROSS REFERENCES Broadcasting; Electronic Surveillance; Employment Law; Entertainment Law; Fairness Doctrine; Pornography; Privacy. TELEVISION In the early 2000s, television remained the most powerful medium of mass communication seen regularly by most perso ns in the United States. Television signals have traditionally been deliv- ered by using antennas (broadcast ), communi- cation satellites, or cable systems. Because of television’s societal impact, the federal govern- ment regulates companies that operate televi- sion systems. Experimental television systems we re de- veloped in the 1930s, b ut commercial exploi- tation did not occur in the United States until the late 1940s. I nitially, television signals were broadcast from antennas and received by a television set in a person’s home or business. Improved technology led to the replacement of black-and-white images with color signals in the 1 960s. The FEDERAL COMMUNICATIONS COMMISSION (FCC), which was established by the Commu- nications Act of 1934 (47 U.S.C.A. § 151 et seq.), originally was charged with the regulation of radio. With the introduction of television and the need for television stations to obtain FCC licenses to use broadcast frequencies, the FCC assumed sole jurisdiction over the television industry. Television broadcasts may be regulated for content. Typically, this regulation has focused on broadcasts of allegedly obscene or indecent material. The U.S. Supreme Court has upheld regulations banning obscene material, as OB- SCENITY is not protected by the FIRST AMENDMENT to the U.S. Constitution. It has also permitted the FCC to prohibit material that is “patently offensive” and either “sexual” or “excretory” from being broadcast during times when chil- dren are presumed to be in the audience (FCC v. Pacifica Foundation, 438 U.S. 726, 98 S. Ct. 3026, 57 L. Ed. 2d 1073 [1978]). The TELECOMMUNICATIONS Act of 1996 (Pub. L. No. 104-104) mandated the establishment of an advisory committee fo r the rating of video programming that contains indecent materials for purposes of parental control. The act also required televisions with screens 13 inches or larger, manufactured after 1998, to be equipped with a so-called V chip to allow parents to block programs having a predesignated rating for sex and violence. In 1998 the FCC approved the program rating system developed by the net- works to assist parents in monitoring the shows their children watch. CABLE TELEVISION has grown tremendously since the 1980s. Cable television originally served communities in mountainous regions that had difficulty receiving broadcast transmis- sions. Many communities solved this problem by erecting tall receiving towers to capture broadcast signals and retransmit them over wires running from the tower to homes that sub- scribed to this service. During the 1970s and 1980s, large corpora- tions installed cable systems in every large metropolitan area in the United States, as well as in many rural areas. Independent program- ming was transmitted on cable systems by companies such as Home Box Office (HBO) and Cable News Network (CNN). Although cable television could not be categorized as broadcasting in the traditional sense, the FCC adopted the first general federal regulation of cable systems. Local govern ment also became involved, as each municipality had to award a cable system franchise to one vendor. GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION TELEVISION 497 . extended illnesses, leave, or professional training of IRS personnel. The 199 8 bill of rights resulted from a series of hearings held before Congress in 199 6 and 199 7. The 199 8 act added several provisions related. THOSE OF OUR OWN WIDE -SPREAD REPUBLIC. —ZACHARY TAYLOR GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION TAYLOR, ZACHARY 491 their admission to the Union, outlawed the slave trade in the District of. was named commanding general of all U.S. forces in Florida. GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 490 TAXPAYER’ SSUIT In 1845, soon after the ANNEXATION of Texas, President JAMES K.