Schumer Aims to Push CRA Resolution on Net Neutrality Rules Repeal Through Senate

Senate Minority Leader Chuck Schumer, D-N.Y., vowed Friday to "force" a floor vote on a planned Congressional Review Act resolution of disapproval to counteract the FCC order to repeal 2015 net neutrality regulation. Sen. Ed Markey, D-Mass., and House Communications Subcommittee ranking member Mike Doyle, D-Pa., are leading the CRA push and will file their respective resolutions in the Senate and House once the order is promulgated (see 1712110050, 1712120037 and 1712140044). Industry lawyers and governance experts noted diverging opinions on the procedural timeline for bringing up CRA resolutions on the net neutrality repeal. The precise timetable for court challenges to the order is also somewhat murky due to the item's structure, attorneys told us.

Schumer endorsed the CRA proposal during a news conference at WeWork's New York headquarters, saying it would “help us hit ‘control-alt-delete’” and undo “the evil repeal.” The resolution will likely have “bipartisan support” in the Senate and will be bolstered further by the pending addition of Senator-elect Doug Jones, D-Ala., Schumer said. Jones declared his support for net neutrality during his campaign (see 1712130001). Jones will bring to 49 the number of Democrats and Democratic-caucusing independents in the Senate.

Schumer said CRA allows him or any other senator to bring up the resolution “as of right” without clearance by Majority Leader Mitch McConnell, R-Ky. "It’s in our power to do that and that’s the beauty of the CRA rule,” Schumer said. “Sometimes we don’t like them" but "now we can use the CRA to our benefit, and we intend to.” George Washington University Regulatory Studies Center Director Susan Dudley and Demand Progress Policy Director Daniel Schuman told us Schumer can effectively force a vote. Dudley noted CRA “specifies expedited procedures that can bypass” the traditional legislative process. Markey, Demand Progress and Free Press lauded Schumer’s announcement.

The resolution, once introduced, would still be assigned to the committee of jurisdiction, Schuman said. After 20 days, 30 senators can collectively petition to discharge the committee of its role, at which point any senator can make a motion to proceed to a final vote, he said. If 51 senators vote yes, the resolution will go to final vote, Schuman said. If the Senate passes the resolution, it would then move to the House, where it faces more difficult hurdles, Schuman said. Discharging the House Rules Committee's role and moving the resolution to a floor vote would require at least 218 or a bare majority of representatives’ support, he said. The House Rules Committee also could move to advance the resolution to the floor but it “would be hard to imagine” the committee doing so given Republicans’ 9-4 member advantage on that panel, Schuman said.

Democrats likely can count on their entire Senate caucus to vote for the CRA resolution, and may be able to persuade Sen. Susan Collins, R-Maine, Schuman said. Can Schumer “get to 51? That’s the question,” Schuman said. There could be “significant pressure on a lot of vulnerable Republicans” in both houses to support countermanding the FCC on net neutrality, as evidenced by opposition from Collins, Rep. Mike Coffman, R-Colo., and a handful of others, Schuman said. Schumer’s backing of the CRA bid appears to be “much more about messaging and optics rather than about trying to correct a perceived mistake” by the FCC, said Information Technology and Innovation Foundation Telecom Policy Director Doug Brake.

The CRA trigger “is the date the rule is published in the Federal Register or submitted to Congress, whichever is later,” Dudley said. Markey plans to file his resolution “once the rule is submitted to both houses of Congress and published” in the FR, his office said. CRA resolution sponsors have 60 legislative days from the day both conditions are met to get their proposal through the legislative process, but what that means in real time is up for significant debate, said Free Press Policy Director Matt Wood and others. “The CRA time frames are exceedingly complex,” in part because “days only count as legislative days per definitions set by Congress,” Wood said. “Six months is a reasonable enough ballpark, but you can't even determine it in advance because we don't know every day that Congress will be in session” in 2018. “Legislative days are like dog years,” said Georgetown Law Institute for Public Representation senior counselor Andrew Schwartzman: “At this time of year, it might be as short” as four months.

Court Timetable

Several groups said they plan to challenge the "internet freedom" order in court, including Free Press, Incompas, National Hispanic Media Coalition and Public Knowledge, with the Internet Association weighing legal options. More could be coming. "I expect a considerable number of petitions for review and interventions, not to mention a substantial number of amicus briefs," said Schwartzman. He cited state attorneys general, public interest groups, small tech companies and large tech companies as candidates. Among parties that announced plans, none told us whether it will seek a stay or in which U.S. circuit court it will file.

The timetable for legal challenges is complicated by the structure of the "order," which is a combined declaratory ruling, report and order, and order, some lawyers said. Parties have 60 days to challenge a final order under 28 U.S. Code, Section 2344, but if they want to be part of a judicial lottery to choose the circuit court in case of filings in multiple court venues, they must do so within 10 days under 47 CFR 1.13, the lawyers said.

Some say the trigger date can change, depending on when an order is "final." PK Senior Vice President Harold Feld said FCC orders are considered final upon release, unless they're a product of a rulemaking, in which case they're final when published in the Federal Register. "Finality is important because if you file too early, then you get dismissed for lack of jurisdiction," he said. Because the proceeding to roll back net neutrality regulation was "mostly a rulemaking, the general assumption is that the order is final when published in the Federal Register," he emailed. "However, it is possible to argue that the declaratory ruling piece is not a rulemaking, but an adjudication, and therefore is 'final' on release." The declaratory ruling reclassified broadband access from a Title II telecom service to a less-regulated Title I information service under the Communications Act.

"Publication in the Federal Register triggers the time for filing a petition for review and anyone who wants to influence the forum needs to file a petition and serve it on the FCC within ten days of Federal Register publication," emailed Harris Wiltshire attorney Chris Wright, a former FCC general counsel. Another ex-general counsel emailed that appellate timing rules differ "depending on rulemaking vs. declaratory order, etc. I expect parties will file a 'protective petition for review' with respect to the declaratory ruling and then file another petition with respect to the rulemaking."

Free State Foundation President Randolph May believes the FCC will win, maybe at the Supreme Court: "Given the combination of the Brand X precedent and Chevron deference, the FCC’s analysis of its authority to reclassify should prevail." He noted that in the U.S. Court of Appeals for D.C Circuit denying rehearing in USTelecom upholding the 2015 FCC Title II net neutrality order, Judge Sri Srinivasan, joined by Judge David Tatel, "declared the ISPs were free to act in a non-neutral way as long as they disclosed they were doing so. ... A fair reading of the majority’s rehearing opinion suggests that the ISPs, in fact, already were permitted to do under the 2015 rules what the pro-regulatory advocates suggest the FCC is just now allowing them to do."

FCC Wireline Bureau Chief Kris Monteith said the ruling and orders won't take effect until the Office of Management and Budget approves a new transparency rule. "The first step will be -- we will publish the order itself in the Federal Register, a summary of the order, the entire order," she said at a news conference Thursday. "We also have to seek approval by OMB of the new transparency rule. Once we have OMB approval, we will also publish, again in the Federal Register, a notice of the OMB approval, plus announce the effective date of the entire item."

An FCC spokesman added some further details Friday. The commission will publish in the FR a Paperwork Reduction Act estimate on the industry burdens of the transparency rule's information collection requirements, giving parties 60 days to comment. After reviewing the comments, the FCC will put a statement on the burdens in the FR, and the OMB will accept comments for 30 days, after which it can make a decision on whether to approve the requirements, he said.

Analyst Views

Raymond James analyst Frank Louthan agreed with what supporters of the 2015 order feared, that ISPs will build business plans around paid prioritization. “This is the most obvious revenue opportunity for the carriers … and over time new models should emerge for carriers to either charge content providers for better access to customers OR consumers to pay for better access to certain content,” he wrote investors. But that’s good for consumers and ISPs, he said: “The internet is not a zero-sum game.”

Bank of America said the net neutrality order is no doubt positive for ISPs bottom line. “While it ‘feels’ like a win, the industry is one election away from it all changing again,” the firm said. It doesn’t expect ISPs to make moves that will bring the attention of Congress. “The practical near-term effect is that the FCC won’t interfere in market pricing as it stands and zero-rated wireless services will remain in effect,” it said.

Former FCC Chairman Tom Wheeler, now at Brookings, questioned whether the FTC will be in a position to police the internet, as FCC Republicans insist. “By a party-line vote, the Trump FCC executed the network companies’ playbook to perfection,” Wheeler blogged. “The press has focused on the repeal of the Obama era net neutrality rules, but the Commission went far beyond that to deliver just what the headline proclaimed." The blog's title: "A goal realized: Network lobbyists’ sweeping capture of their regulator."

MoffettNathanson’s Craig Moffett saw the order less as an end to net neutrality than a shifting of jurisdiction, from the FCC to FTC. That was the point made repeatedly by FCC Republicans repeatedly Thursday.

Gigi Sohn, a Wheeler aide when the 2015 order was approved, told us Friday she was surprised at the tone of Pai and other Republicans at Thursday’s meeting. There was no acknowledgement that consumers have a “legitimate gripe” or the “real anxiety” felt by consumers, she said. “There was absolutely no empathy or recognition that people might have legitimate concerns,” she said. “I thought that elitist disdain really came out.” After the 2015 order “Wheeler didn’t say ‘you’re all crazy hysterics, go suck an egg,’” Sohn said. Her advice to Pai: “You stood up to the pressure. You got your win. Take your ball and go home.”

Other net neutrality news Friday: On states 1712150042 and on antitrust 1712150045.