SEC denies carrier attempts to block shareholder net neutrality votes

The agency doesn't buy arguments by AT&T, Verizon and Sprint saying net neutrality isn't a significant policy issue

The U.S. Securities and Exchange Commission has rejected attempts by three telecom companies to block shareholder votes on whether they should commit to net neutrality principles.

This week, the SEC declined to act on requests by AT&T, Verizon Communications and Sprint Nextel to block the votes. All three companies had argued that net neutrality was not a significant policy issue under SEC definitions and, therefore, they weren't required to put the matter to a shareholder vote.

The SEC disagreed, saying in letters to the company that there's been a "sustained public debate over the last several years concerning net neutrality and the Internet and the increasing recognition that the issue raises significant policy considerations."

Carriers had successfully suppressed shareholder proposals on net neutrality in the past three years.

Since early 2010, net neutrality advocates, including musician Michael "Mike D" Diamond of the Beastie Boys, have pushed for shareholder votes in support of net neutrality practices at broadband and mobile providers.

Diamond was one of several investors in Verizon and AT&T, also including the Nathan Cummings Foundation and the Benedictine Sisters of Mount St. Scholastica in Atchison, Kansas, who pushed for the votes. The foundation pushed for the vote at Sprint.

Net neutrality has implications for "social and economic justice" and long-term shareholder value, Laura Campos, director of shareholder activities at the Nathan Cummings Foundation, said in a statement. "The foundation is concerned that over the longer-term, a failure to operate their wireless broadband networks in accordance with the principles of network neutrality could negatively impact their market shares and damage their reputations with consumers," she said.

The upcoming shareholder votes may not need to be successful to have an impact on company practices, said Michael Connor, executive director of the Open Media and Information Companies Initiative (Open MIC), an advocacy group that has pushed for the votes.

"We have a lot of work to do over the next couple of months, but we're very hopeful that institutional and individual shareholders will agree that an open wireless Internet is critically important for individuals, for the companies and for the health of our economy," he said.

Verizon declined to comment on the SEC action. An AT&T representative did not respond to a request for a comment.

Verizon, in a letter to the SEC this month, argued that little has changed in the debate over net neutrality since prior attempts to force shareholder votes. The SEC, in the past, has voiced a "well-established position" allowing the company to block the proposed votes, wrote Mary Louise Weber, Verizon's assistant general counsel.

The shareholder proposals are both "impermissibly vague" and seek to "micro manage Verizon's ordinary business operations," Weber added.

Sprint had also sought to block the vote because it dealt with the company's "ordinary business operations," spokesman John Taylor said. SEC rules allow companies to block proposed shareholder votes if they relate to ordinary business operations and do not raise substantial policy questions.

Sprint is considering its next steps, Taylor said.

Grant Gross covers technology and telecom policy in the U.S. government for The IDG News Service. Follow Grant on Twitter at GrantGross. Grant's e-mail address is grant_gross@idg.com.

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.
Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Grant Gross

IDG News Service
Show Comments

Brand Post

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Luke Hill

MSI GT75 TITAN

I need power and lots of it. As a Front End Web developer anything less just won’t cut it which is why the MSI GT75 is an outstanding laptop for me. It’s a sleek and futuristic looking, high quality, beast that has a touch of sci-fi flare about it.

Emily Tyson

MSI GE63 Raider

If you’re looking to invest in your next work horse laptop for work or home use, you can’t go wrong with the MSI GE63.

Laura Johnston

MSI GS65 Stealth Thin

If you can afford the price tag, it is well worth the money. It out performs any other laptop I have tried for gaming, and the transportable design and incredible display also make it ideal for work.

Andrew Teoh

Brother MFC-L9570CDW Multifunction Printer

Touch screen visibility and operation was great and easy to navigate. Each menu and sub-menu was in an understandable order and category

Louise Coady

Brother MFC-L9570CDW Multifunction Printer

The printer was convenient, produced clear and vibrant images and was very easy to use

Edwina Hargreaves

WD My Cloud Home

I would recommend this device for families and small businesses who want one safe place to store all their important digital content and a way to easily share it with friends, family, business partners, or customers.

Featured Content

Product Launch Showcase

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?