Legal Armies, in Search of New Battles

With the Big Mergers Over, the Communications Bar Is Shrinking -- but Still Busy

Standing in his K Street office with a headset glued to his ear, Andrew Jay Schwartzman thinks of himself as a guerrilla leader launching lightning raids against the nation's big communications companies to defend the public interest.

In a corner office three blocks down K Street, former Federal Communications Commission chairman Richard E. Wiley commands an army of lawyers on behalf of many of the country's major telephone, cable and media groups.

Operating at opposite ends of the spectrum, the two are among the thousands of lawyers, consultants, economists and lobbyists who toil in one of Washington's signature industries: communications law. They hurl legal filings at one another before the FCC and in the courts, track the shifting sands in Congress and spend millions of dollars on ad campaigns.

Long a staple of business in the nation's capital, the communications law community appears to be shrinking some because of changes in the marketplace. The classic battle between long-distance and local phone companies has ended, and many of the largest phone companies are merging into fewer -- and bigger -- players.

"I think the FCC bar is going to diminish, in large part because for 20 years it was fueled by these two big armies, one for the long-distance companies and one for the Bells, and once you merged them, it's like the end of the Cold War," said Blair Levin, an analyst at Stifel, Nicolaus and Co. and a former FCC chief of staff. "There are a lot of spies out there who don't know what to do with themselves."

The Federal Communications Bar Association's membership rose from 2,100 in 1994 to a peak of 3,386 in 2000 as the industry fought a series of battles over implementing the Telecommunications Act of 1996. Once many of those matters were settled and after the dot-com and telecom bubbles burst in 2000, its membership drifted down -- to 2,780 last year.

But Washington's telecom complex is still vibrant, as networks of lawyers, staffers and experts focus on new issues raised by changing technologies.

"You are seeing a contraction, for sure, as the statistics indicate, but also a sort of diffusion into what one might think of as immediately adjacent fields," said Philip L. Verveer, a lawyer at Willkie Farr Gallagher LLP. "While it's diminishing in a traditional regulatory sense, there are new things that are beginning to arise. You will find lawyers that have been in a traditional regulatory practice moving into adjacent fields -- intellectual property, privacy, data protection."

One example of traditional legal work is the $12.7 billion bid by Comcast Corp. and Time Warner Inc. for most of the assets of Adelphia Communications Corp., a cable company that filed for Chapter 11 bankruptcy protection from its creditors nearly four years ago.

In addition to being a straight cable merger, the deal also involves the companies' efforts to move into areas of high-speed Internet, telephone and other services to better compete with phone companies for their customers.

Schwartzman and Wiley are at odds over the transaction, and their David-and-Goliath conflict illustrates the full range of the local industry.

Wiley, whose firm, Wiley Rein & Fielding LLP, has 75 communications specialists among its more than 250 lawyers, represents Comcast. Schwartzman's Media Access Project, which has three lawyers, three support staffers and two or three law student interns at any one time, represents a band of nonprofit advocacy groups.