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Net Neutrality

D.C. Circuit Court Upholds FCC Chairman Ajit Pai’s Repeal of Net Neutrality, But Allows States to Fill the Void

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4 years ago

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Photo of Ajit Pai in February 2018 by Gage Skidmore used with permission

WASHINGTON, October 1, 2019 — The Federal Communications Commission’s repeal of Obama-era network neutrality rules will remain, a three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit ruled on Tuesday.

However, in a bit of a split decision, the court said that the agency did not have authority to preemptively ban states from passing their own versions of net neutrality legislation.

The panel largely rejected a challenge to new rules which reclassify broadband internet as an information service, rather than a common carrier akin to telephone service.

The ruling appeared to put an end to efforts by public interest advocacy groups and some internet companies to overturn the reclassification of broadband internet service.

In December 2017, FCC Chairman Ajit Pai led the Republican commissioners to overturn the agency’s February 2015 decision to prohibit broadband providers from blocking or throttling particularl types of internet traffic.

“We hold that classifying broadband Internet access as an “information service” based on the functionalities of DNS and caching is “‘a reasonable policy choice for the [FCC] to make,’” the court wrote in a unanimous opinion. The decision relied heavily on case law – so-called Chevron deference after a Supreme Court case by that name from the 1980s — requiring courts to defer to agencies’ interpretations of ambiguous statutes.

The plaintiffs’ objections to the reclassification, the court wrote, were “unconvincing for the most part.”

In leaving room for states to enact their own net neutrality laws — by finding that the agency lacked the authority to bar states from enacting rules more stringent than the FCC’s requirements — some aspects of the decision cheered advocates of net neutrality. The court also required the FCC to more fully consider the needs of public safety users.

In a statement, TechFreedom President Berin Szoka applauded the court’s decision, but noted that it leaves room for a future Democratic-majority FCC to reinstate the Obama-era rules and shift the long-running battle over network neutrality to state legislatures and case-by-case court battles.

“Today’s decision vindicates the RIFO, but Chevron deference to the Republican FCC’s interpretation will likely be tomorrow’s Chevron deference to the next Democratic FCC’s interpretation,” Szoka said. “So this issue will remain a political football for the foreseeable future, unless and until Congress finally writes into statute the open Internet principles that virtually all parties have agreed on since 2004.”

Internet Innovation Alliance Co-Chairs Rick Boucher, Bruce Mehlman, and Kim Keenan also lauded the ruling, which they said “deserves applause from everyone who wants to see an expansion of innovation, competition and investment in the internet ecosystem.”

“But ruling that the FCC can’t block state laws and thus allowing rules that differ among all 50 states could spell disaster for advancement of the internet, as web services are offered on a national basis, and many would be disrupted by a multiplicity of diverse and contradictory state net neutrality requirements,” they added.

“Unless Congress codifies nationwide open internet rules, including the designation of broadband as an information service, we will very likely see continuation of the ping-pong at the FCC between classifications of broadband as an information service and as a telecommunications service.”

Also speaking out in favor of the decision was US Telecom CEO Jonathan Spalter, who said in a statement that the court “got it right and affirmed what anyone who has been paying attention to Washington’s net neutrality saga knows to be true: the internet is open, ISPs are investing to bring internet users the content they want, and we remain absolutely opposed to anti-consumer practices like blocking, throttling and anti-competitive paid-prioritization.”

Sen. Ed Markey, D-Mass., a longtime network neutrality proponent, said in a statement that the court’s decision “leaves the future of the free and open internet in question.”

“When I attended the net neutrality court hearing earlier this year, I heard the FCC and broadband industry use tortured logic to defend the repeal of net neutrality and undermine strong rules for an open internet,” Markey said. “Sadly, today’s court opinion doesn’t reflect the clear reality that Americans rely on the internet the way they rely on electricity or telephone service.

But at the FCC, the court’s decision providing something for everyone.

In dueling press statements, both Republicans and Democrats at the FCC claimed victory.

Said the Republican Pai, ignoring the criticisms of the ruling made by the three judge panel:

“Today’s decision is a victory for consumers, broadband deployment, and the free and open Internet.  The court affirmed the FCC’s decision to repeal 1930s utility-style regulation of the Internet imposed by the prior Administration.  The court also upheld our robust transparency rule so that consumers can be fully informed about their online options.  Since we adopted the Restoring Internet Freedom Order, consumers have seen 40 percent faster speeds and millions more Americans have gained access to the Internet.  A free and open Internet is what we have today and what we’ll continue to have moving forward.  We look forward to addressing on remand the narrow issues that the court identified.”

Commissioner Geoffrey Starks, a Democrat highlighted the fact that states remain free to pass net neutrality legislation:

“Above all else, today’s decision breathes new life into the fight for an open internet.  It confirms that states can continue to step into the void left by this FCC.  To that end, it is a validation of those states that have already sought to protect consumers, and a challenge to those that haven’t yet acted to think hard about how to protect their citizens.  More pointedly, the decision affirms that the FCC ignored key aspects of its mission with regard to public safety and broadband deployment.  And the decision admonishes this Commission for its failure to consider the impact of its action in this context on Lifeline, a critical program that makes broadband more affordable for low-income consumers.”

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Andrew Feinberg was the White House Correspondent and Managing Editor for Breakfast Media. He rejoined BroadbandBreakfast.com in late 2016 after working as a staff writer at The Hill and as a freelance writer. He worked at BroadbandBreakfast.com from its founding in 2008 to 2010, first as a Reporter and then as Deputy Editor. He also covered the White House for Russia's Sputnik News from the beginning of the Trump Administration until he was let go for refusing to use White House press briefings to promote conspiracy theories, and later documented the experience in a story which set off a chain of events leading to Sputnik being forced to register under the Foreign Agents Registration Act. Andrew's work has appeared in such publications as The Hill, Politico, Communications Daily, Washington Internet Daily, Washington Business Journal, The Sentinel Newspapers, FastCompany.TV, Mashable, and Silicon Angle.

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Expert Opinion

Ted Hearn: A Supreme Court Case About Fish Could Harpoon The FCC

Opponents of the Chevron Doctrine aver that judicial deference has gone too far.

Published

15 hours ago

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January 15, 2024

By

The author of this Ted Hearn, Editor of Policyband

WASHINGTON, January 15, 2024 – On Wednesday, the Supreme Court will hear a case about federal regulation of the fishing industry.

Anyone who thinks the case is about fish is going to need a bigger boat.

In reality, this whale of a case could harpoon the Federal Communications Commission, which is clearly at risk of seeing its newly approved, highly controversial digital discrimination rules aimed at broadband Internet Service Providers get fed to the sharks.

Since 1984, the Supreme Court’s Chevron Doctrine has required lower courts to defer to an agency like the FCC when reasonably interpreting vague legislative language passed by Congress. The doctrine was established in Chevron U.S.A. v. Natural Resources Defense Council.

Opponents of the Chevron Doctrine aver that judicial deference has gone too far, leading to outsized accretions of bureaucratic power that threaten the nation’s constitutional order sustained by the separation of powers.

“Chevron deference has become a central pillar of the modern administrative state,” said Stanford Law School Professor Michael W. McConnell. “Although Chevron appeared routine when it came out, it has become the most important doctrine in administrative law.”

The FCC under Democratic Chair Jessica Rosenworcel has a lot riding on the high court’s ruling in Loper Bright Enterprises v. Raimondo, which is ostensibly about the regulation of fisheries under the Magnuson-Stevens Act of 1976. A decision is not expected for several months after Wednesday’s oral arguments.

In November, the FCC adopted Internet digital discrimination rules as required by Congress in section 60506 of the Infrastructure Investment and Jobs Act of 2021.

The FCC rules included a “disparate impact” standard imported from civil rights law that can hold ISPs liable for unintentional acts of discrimination across a broad range of activities – from the price and quality of Internet service to late fees, equipment rentals, and the use of customer credit and account history.

Litigation on the basis that the FCC developed rules far broader than Congress intended is inevitable.

“The FCC’s regulatory overreach will prove impossible to administer and impossible to comply with,” said Michael Powell, President & CEO of the NCTA – The Internet & Television Association, in a Nov. 15, 2023 statement.

The Supreme Court likely has at least five justices who want to dismantle the Chevron Doctrine entirely. The Court majority that would do so is likely the same one that in 2022 barred an agency like the FCC from adopting rules of vast economic and political significance without explicit authority from Congress.

The Chevron Doctrine has its defenders, including the Environmental Defense Fund and other green groups that say opponents of judicial deference have been exaggerating the harms.

“This campaign is marked by the kind of sloganeering, argument by anecdote, and sacrifice of empirical rigor that are all too familiar in hardball politics but out of place in legal argumentation,” the EDF said in its amicus brief filed with the Supreme Court last September. “Like any shrewd campaigners, petitioners and their supporters seek to ‘drive up the negatives’ by misstating what Chevron instructs.”

Last June, an article on the Natural Resources Defense Council’s website disputed ideas that the Chevron Doctrine gave an agency like the FCC “a rubber stamp” to adopt onerous rule and regulations. Ironically, the NRDC supports the maintenance of the Chevron Doctrine, even though it was the losing party in the 1984 case.

“…As noted by the Brennan Center for Justice, a nonpartisan law and policy institute, federal agencies face legal challenges to their rules all the time – and only prevail in about 70% these challenges, even with the Chevron Doctrine on their side. In other words, their powers are far from unchecked,” the article said.

A problem with the NRDC article’s analysis is that it gave equal weight to each case in the sample. Broadband ISPs have much more at stake in their likely legal challenge to the FCC’s digital discrimination rules than in their potential case taking on new FCC rules requiring Internet providers to display ‘Broadband Nutrition Labels’ at the point of sale.

In the end, by scuttling the Chevron Doctrine, the Supreme Court will not only reel in a big fish like the administrative state, it will also send Congress a message about the need to craft clear laws.

“Congress will face more pressure to clearly articulate agency authority and delegate fewer details to administrative agencies,” the Brownstein Hyatt law firm said in a client alert last May.

Ted Hearn is the Editor of Policyband, a new website dedicated to comprehensive coverage of the broadband communications market. This piece is was published on Policyband on January 15, 2024, and is reprinted with permission.

Broadband Breakfast accepts commentary from informed observers of the broadband scene. Please send pieces to commentary@breakfast.media. The views expressed in Expert Opinion pieces do not necessarily reflect the views of Broadband Breakfast and Breakfast Media LLC.

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FCC

FCC Rules Face Litigation Risk in 2024, Note Journalists

A potentially active Supreme Court and its ‘major questions’ doctrine could pose challenges for the FCC.

Published

2 weeks ago

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January 4, 2024

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WASHINGTON, January 4, 2024 — A panel of top telecom journalists on Wednesday warned that major FCC policy moves in 2023 face significant litigation threats in the year ahead.

The year “2024 is going to include a lot of litigation and a lot of it generated by the cable TV industry,” said Ted Hearn, editor of Policyband.

Ted Hearn of Policyband

Speaking on Broadband Breakfast Live Online Wednesday, Hearn said that industry would likely be challenge the agency’s rules on net neutrality, digital discrimination, early termination fees, and “all-in” pricing.

Others of the journalists agreed that the FCC’s net neutrality order is unlikely to survive court scrutiny. Howard Buskirk, executive senior editor of Communications Daily, pointed out that  the Supreme Court’s “major questions doctrine” as a barrier for the FCC to overcome.

In 2022, the Supreme Court held in West Virginia v. EPA that Congress alone has the power to decide on “major questions” of “vast economic or political significance.” Hearn and Buskirk said that it was almost certain that net neutrality would fit into that category, and that as such a “major question,” its resolution was the responsibility of Congress alone.

Noting the lack of radio frequency spectrum availability in 2023, Buskirk also highlighted the role of spectrum sharing over the past year. This included the FCC’s focus on finalizing rules for specific spectrum bands, such as the 4.9 GigaHertz, as well as the broader implications for 5G and 6G wireless technology development.

BEAD Implementation

Other topics covered included details in the implementation of the $42 billion Broadband Equity, Access and Deployment program, and concern over the likely depletion of the Affordable Connectivity Program fund.

While BEAD is likely to help advance rural connectivity, its focus on rural areas leaves major urban connectivity gaps unaddressed, noted Sean Gonsalves, senior reporter and editor at the Institute for Local Self-Reliance’s Community Broadband Networks Initiative. He predicted the lion’s share of BEAD funds will be awarded to incumbent internet service providers.

Gonsalves also highlighted that the FCC’s new rules around digital discrimination may amount to little given that the agency allows for discrepancies as “justified by genuine issues of technical or economic feasibility.”

As the event wound down, Broadband Breakfast Editor and Publisher Drew Clark, the session moderator, asked each panelist to name one surprise issue to watch for in 2024.

Hearn highlighted marketplace challenges for the cable industry, including from fixed wireless access.

Buskirk said the year will be dominated by actions at the FCC, including those by recently-confirmed agency Commissioner Anna Gomez.

Gonsalves warned of increasingly aggressive anti-community broadband campaigns by cable lobbyists.

Telecommunications Reports Senior FCC Reporter Lynn Stanton closed the session by predicting “some big sleeper issue we’ve all completely forgotten about that will somehow rise from the dead now that the FCC has this 3 to 2 majority.”

Our Broadband Breakfast Live Online events take place on Wednesday at 12 Noon ET. Watch the event on Broadband Breakfast, or REGISTER HERE to join the conversation.

Wednesday, January 3, 2024 – The Broadband Forecast for 2024 with Tech Journalists

Kick off 2024 with us at our first livestream event of the year with broadband journalists predicting the biggest shifts in infrastructure and connectivity in 2024 as we consider The Twelve Days of Broadband! Tune in to get a glimpse into the future of connectivity and where the year might take us!

Panelists

  • Howard Buskirk, Executive Senior Editor, Communications Daily
  • Sean Gonsalves, Senior Reporter, Editor and Communications Team Lead, Institute for Local Self Reliance’s Community Broadband Networks Initiative
  • Ted Hearn, Publisher, Policyband
  • Lynn Stanton,  Senior Editor, Wolters Kluwer’s TR Daily.
  • Drew Clark (moderator), Editor and Publisher, Broadband Breakfast

Ted Hearn is the Editor and Publisher of Policyband, a new website dedicated to comprehensive coverage of the broadband communications market. A former communications executive and reporter for newsletters and trade journals, Hearn has decades of experience with traditional video and broadband industry trends, regulatory developments, technology advancements, and market dynamics.

Howard Buskirk is Executive Senior Editor and joined Warren Communications News in 2004, after covering Capitol Hill for Telecommunications Reports. He has covered Washington since 1993 and was formerly executive editor at Energy Business Watch, editor at Gas Daily and managing editor at Natural Gas Week. Previous to that, he was a staff reporter for the Atlanta Journal-Constitution and the Greenville News.

Sean Gonsalves is Senior Reporter, Editor and Communications Team Lead, Institute for Local Self Reliance’s Community Broadband Networks Initiative. He is a longtime former reporter, columnist, and news editor with the Cape Cod Times. He is also a former nationally syndicated columnist in 22 newspapers, including the Oakland Tribune, Kansas City Star and Seattle Post-Intelligencer. His work has also appeared in the Boston Globe, USA Today, the Washington Post and the International Herald-Tribune. An award-winning newspaper reporter and columnist, Sean also has extensive experience in both television and radio.

Lynn Stanton is Senior Editor for Wolters Kluwer’s TR Daily, has been covering telecommunications, broadband, and Internet policy for nearly three decades. She has also reported on pharmaceutical marketing compliance and has worked as a copyeditor for a wide range of publications. She holds a bachelor’s degree in government and politics from the University of Maryland and a master’s degree in political theory from the University of Virginia.

Breakfast Media LLC CEO Drew Clark has led the Broadband Breakfast community since 2008. An early proponent of better broadband, better lives, he initially founded the Broadband Census crowdsourcing campaign for broadband data. As Editor and Publisher, Clark presides over the leading media company advocating for higher-capacity internet everywhere through topical, timely and intelligent coverage. Clark also served as head of the Partnership for a Connected Illinois, a state broadband initiative.

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12 Days of Broadband

12 Days of Broadband: Net Neutrality Is the Issue That Never Dies

It’s been 11 years since Verizon filed arguments against the FCC in the D.C. Circuit Court of Appeals.

Published

2 weeks ago

on

January 2, 2024

By

Illustration by DALL-E

January 2, 2024 – The net neutrality debate was alive and well in 2023, more than 11 years since Verizon filed arguments against the Federal Communications Commission before the D.C. Circuit Court of Appeals in July 2012 in a partisan issue that has dominated telecom politics for more than a decade.

In the latest twist in the saga, the FCC proposed in October 2023 to reclassify broadband internet as a telecommunications service under Title II of the Communications Act.

If ultimately approved, the move would give the FCC broader authority over broadband providers. Crucially, the commission would be able to require that internet traffic is not sped up or slowed down artificially, meaning businesses could not pay providers for preferential treatment.

The issue is a contentious one at the FCC, and the commission can only take it up now that Democrats have a 3-2 majority, after several years of a 2-2 agency. Along with the strong digital discrimination rules adopted in November, it’s part of a Democratic effort to expand regulatory oversight of broadband as it becomes more essential for daily life.

Republicans in Congress and at the FCC oppose this, arguing it makes providers less likely to invest in new infrastructure. 

Controversy over Title II Reclassification

Title II brings a host of other regulatory powers, but the commission is proposing to abstain from wielding more than two dozen of the most onerous provisions on broadband providers if the service is recategorized. Those include explicit rate regulation and immediate Universal Service Fund contribution.

Net neutrality has been a longstanding goal of the Biden administration and Democratic FCC Chairwoman Jessica Rosenworcel, who referenced it in a letter to lawmakers after being confirmed as chairwoman in December 2021. 

“You’re dealing with the most central infrastructure in the digital age. Come on, it’s time for a national policy,” Rosenworcel said before voting in favor of the proposal at the commission’s October open meeting. It would pass 3-2 along party lines, putting the rules up for public comment.

That set the commission up for an earful: more than 40,000 comments on the proposed net neutrality rules have since been filed with the agency. Reply comments on the proposal are due January 17, 2024.

The broadband industry is largely opposed to the move. AT&T and T-Mobile, in addition to trade groups and conservative think tanks, filed comments arguing that the practices net neutrality rules are designed to combat are not widespread. They say using Title II authority to enforce net neutrality principles would stifle investment in broadband, both by opening providers up to sanctions for previously legal conduct and by introducing the potential for future commissions to pick up the 27 Title II provisions the FCC is choosing to forego.

“No ISP takes that assurance seriously,” AT&T said of the commission’s proposal not to regulate broadband prices as part of the rulemaking.

Advocacy groups like Public Knowledge argued the anticompetitive practices net neutrality rules aim to prevent are only uncommon because states like California enacted their own net neutrality laws.They said the move would protect consumers who depend on reliable and consistent internet access.

Broadband “is not a luxury but a necessity for education, communication, and participation in the economy,” the group said. “The FCC’s proposed action will restore its ability to oversee this essential service.”

This was expected to some degree. The Trump-era FCC received comments from many of the same players in 2017 when it repealed net neutrality rules – substantially similar to the 2023 proposal – set up by the 2015 commission under Obama. 

A prolonged nomination to break a deadlock

The commission was unable to move on the issue until this year because Democrats lacked a majority. President Joe Biden first nominated net neutrality advocate Gigi Sohn, a former FCC staffer and co-founder of Public Knowledge, to the FCC’s vacant fifth seat in 2021, but her nomination turned into a prolonged political fight. 

Republican senators hung on her position on the board of a nonprofit streaming service that was shut down after large telecoms sued for copyright infringement. They alleged Sohn would be unable to remain impartial on matters related to broadcasting and copyright – even after she moved to recuse herself from related issues.

Votes repeatedly stalled along party lines before Sohn withdrew her name from consideration in March of this year, citing campaigns against her nomination by telecom lobbyists.

“The unrelenting, dishonest and cruel attacks on my character and my career as an advocate for the public interest have taken an enormous toll on me and my family,” she said in a statement announcing her withdrawal.

Commissioner Anna Gomez had a comparably smooth nomination process. Biden announced her nomination in May after Sohn stepped back and the Senate voted to approve her four months later, finally giving Democrats a 3-2 majority on the FCC. Rosenworcel wasted no time taking advantage of the new math, announcing her intention to reinstate net neutrality rules one day after Gomez was sworn in as a commissioner in September.

Potential legal roadblocks

Following the October vote to move forward with the proposal, Republican Commissioner Brendan Carr pointed out a potential legal hurdle to reclassifying broadband as a Title II service this time around. The Supreme Court’s conservative supermajority has been less deferential to agencies’ interpretation of the law, and might consider the reclassification too significant a move for an agency to make without explicit approval from Congress.

Experts disagree on how likely a Supreme Court intervention is, as the FCC’s previous reclassifications of services under the Communications Act – both the 2015 net neutrality rules and a classification of DSL under Title II in 1998 – have passed legal muster.

At a House oversight hearing in November, Republican Commissioner Nathan Simington asked Congress to “put an end to the continued whipsawing of industry over the Title II fight” by passing new legislation governing the internet ecosystem. A Democratic bill that would codify broadband as a Title II service stalled after being introduced in both the House and Senate last summer.

See “The Twelve Days of Broadband” on Broadband Breakfast

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