2 Legal Challenges Filed to Last Year's FCC Net Neutrality Order

State and local governments and a broad coalition of pro-net neutrality groups and companies said the U.S. Court of Appeals for the D.C. Circuit should overturn the FCC's "internet freedom" order, approved 3-2 last year, which itself overrode net neutrality rules approved just two years earlier. In the opening volley of a major test of Chairman Ajit Pai’s commission decisions, government petitioners said (in Pacer) the D.C. Circuit should find the FCC had no authority to pre-empt state and local police powers and reject the FCC order as an “arbitrary and capricious” departure from 15 years of FCC policy.

“The Order’s relentless deregulatory urge swept aside everything in its path, including the law, the facts, reasoned decisionmaking, and the decisions of this Court,” said the nongovernment petitioners, including Mozilla, Etsy, Vimeo and various consumer and public interest groups, in a separate challenge.

The FCC "identified no valid authority" for pre-empting state and local laws to protect consumers and small businesses from possible broadband internet access service (BIAS) provider abuses, said the government petitioners, led by New York Attorney General Barbara Underwood (D) and including Democratic AGs from more than 20 other states and the District of Columbia. "Having disavowed Title II authority over broadband, the Commission’s preemption order can be rooted only in Title I ancillary authority, which in turn must be based on some separate statutorily mandated responsibility,” they said. The order instead “relied on a purported federal policy of deregulation unmoored from any specific statutory command.”

The D.C. Circuit said in 2010’s Comcast v. FCC (600 F.3d 642) "that policy alone cannot provide the basis for the Commission’s exercise of ancillary authority, and hence cannot support the Order’s attempt to preempt here," the governments said. The FCC can’t rely on conflict pre-emption because it didn't specifically identify that as a basis for its order, but even so, no conflict exists between state broadband regulation and the Communications Act, “which expressly contemplates and relies on active state supervision in this area.”

Public Knowledge, Incompas, Free Press, New America's Open Technology Institute (OTI), the National Hispanic Media Coalition, NTCH, Benton Foundation, the Coalition for Internet Openness, the Ad Hoc Telecom Users Committee and the Center for Democracy and Technology also signed the nongovernment pleading released Tuesday as expected (see 1808200055).

“Our brief details the many ways in which the FCC failed to heed the voices of millions of Americans who support strong, enforceable net neutrality protections,” said Sarah Morris, director-open internet policy at OTI. “By repealing the rules against blocking, throttling and paid prioritization, and undoing the FCC’s legal authority to oversee broadband internet service, Chairman Pai led the Commission in an unprecedented abdication of responsibility over the public interest.”

To undo the 2015 rules, the FCC reclassified broadband service as an information service, not a telecommunications service, “based primarily on a rationale it had never before used,” the coalition said. “All prior decisions” by the FCC, the D.C. circuit and the Supreme Court had acknowledged that broadband internet access service “includes both a telecommunications component and add-on information services that had erstwhile been provided by the BIAS providers themselves.”

Last year’s order said instead that broadband is an information service “not because it is bundled with information services as part of a unified ‘offer’ itself, but because it connects to services and content provided by Hulu, Skype, Snapchat and millions of others,” the pro-net neutrality groups said. The D.C. Circuit already rejected that definition, the groups said. Communications law “defines ‘telecommunications’ as the transmission of information between points specified by the user without change in the information’s form or content,” the filing said. “There is no exception for transmissions that are intended to allow access to an information service.”

The order is "arbitrary and capricious because it failed to reconcile the Commission’s abdication of regulatory authority with the inevitable harms that the Order will cause to consumers, public safety, and existing regulatory schemes,” said government petitioners. It “entirely ignored many of these issues, including public safety, in violation of the agency’s statutory mandate."

The FCC failed to meaningfully justify why it trusts industry promises without any enforcement, government petitioners said. "Nothing in the Order would stop a BIAS provider from abandoning its voluntary commitments, revising its Transparency Rule disclosures, and beginning to block, throttle, or engage in paid prioritization, subject only to the Transparency Rule’s limited disclosure requirements -- leading to the very harms to consumer interests and public safety that the Commission’s long-standing commitment to protecting the open Internet was intended to prevent."

"Prophylactic rules are especially necessary for BIAS because consumers have limited provider options, face high switching costs, and are at a substantial informational disadvantage," the governments said. The record shows "providers have abused and will abuse their gatekeeper roles in ways that harm consumers and threaten public safety,” said states and localities, though later noting “relatively minimal evidence of such harms in the United States is the result of the protective rules that the Commission has abandoned, rather than evidence that those rules are unnecessary.”

State and local government petitioners "share a strong interest in preserving the open Internet as a vital resource for the health and welfare of our residents," they said, citing a 1985 Supreme Court decision in Metropolitan Life Ins. Co. v. Massachusetts (471 U.S. 724) that said states and local police powers give “great latitude” to protect “lives, limbs, health, comfort, and quiet of their residents.” BIAS providers will be able to interfere with governments’ ability to provide nondiscriminatory internet services to residents, governments said.

Other Voices

"In the face of a brazenly uncompetitive marketplace, the FCC abandoned two decades of bipartisan consensus that ISPs should not block, throttle, implement paid prioritization, or otherwise harm online content by engaging in anticompetitive behavior," said Incompas General Counsel Angie Kronenberg. "The FCC cast aside the law, failed to consider relevant evidence, and violated its duty to engage in a reasoned decision-making."

USTelecom CEO Jonathan Spalter defended the FCC order. "Our nation’s broadband providers stand with their consumers in supporting a free and open internet -- without 1930’s-era regulations -- and with consumer protections that are applied consistently across the entire internet ecosystem and not exclusively on ISPs," said Spalter. "The predictions made by some that ISPs would engage in throttling, blocking, and anti-competitive prioritization, have not happened."