Both Sides Optimistic in Case on FCC Title I Rollback of Net Neutrality Rules
Net neutrality advocates voiced confidence in their case against the FCC's order reversing broadband common-carrier regulation, with some optimistic it will be overturned. They said Wednesday the net neutrality rollback under a reclassified Communications Act Title I broadband regime was unjustified legally and bad policy that would unleash ISP "gatekeepers" to throttle and discriminate, harming consumers and competition. Petitioners and intervenors challenging the order held two media calls ahead of Friday's oral argument before a three-judge panel of the U.S. Court of Appeals for the D.C. Circuit in Mozilla v. FCC (see 1901230060). It's case 18-1051.
The FCC pushed back. “We are confident that the Restoring Internet Freedom Order will be upheld in court," said Chief of Staff Matthew Berry in a statement to us. "The U.S. Supreme Court has already affirmed the FCC’s authority to classify broadband as a Title I information service, and we have every reason to believe that the judiciary will uphold the FCC’s decision to return to that regulatory framework under which the Internet flourished prior to 2015 and is continuing to thrive.”
The FCC "eviscerated" net neutrality rules by ignoring the law's "plain language" and "congressional intent" that broadband internet access should be a Title II telecom service, said Sen. Ed Markey, D-Mass, noting he and more than 100 federal legislators filed an amicus brief (in Pacer) supporting challenges. "They are on the wrong side of history and the American people," he said. "We are now on our way to victory in the courts."
Mozilla's "confident" the "court will agree the FCC actions to repeal open internet rules are unlawful," said Chief Operating Officer Denelle Dixon. Incompas is "confident the court will be with us on the facts and the law," said General Counsel Angie Kronenberg. "We look forward" to the court telling the FCC "you got it wrong." New America's Open Technology Institute Deputy Director Sarah Morris is confident the wide scope of challengers "reflects the myriad hurdles the FCC will have to overcome." Challengers have "very solid arguments," said Free Press Policy Director Matt Wood. Public Knowledge is "very confident we have a very strong legal case" and "hopeful" the court agrees, said Chris Lewis, vice president-government affairs. "We're optimistic," said Internet Association CEO Michael Beckerman. IA is "willing to work with Congress" to restore rules.
Advocates said the FCC relied on faulty market assumptions and predictions to substitute limited ISP transparency rules backed by targeted FTC and DOJ consumer protection and antitrust enforcement. Broadband competition is limited and recent network investment has dropped in some cases, they said. Absent safeguards, "companies are throttling, discriminating and charging more for less," said Dixon. ISPs have the "means and the motives" to engage in harmful practices, said Kronenberg, saying ISPs "bamboozled" the FCC into deregulating. The agency previously blocked one major transaction and imposed conditions on others, but ISPs convinced regulators to ignore evidence from those reviews, she said.
There's no effective "cop on the beat," said Morris, arguing the FCC failed to consider substantive issues and provide adequate notice. There's no agency to turn to when ISPs discriminate and fail to provide adequate broadband service on just and reasonable terms, said Wood. Net neutrality ensures there aren't internet access gatekeepers, said Lewis, calling the order "hasty and sloppy," "unreasonable" and an Administrative Procedure Act violation.
Legal Wrangling
FCC allies disagreed. NCTA said it's "confident that the FCC reasonably interpreted the Communications Act, easily satisfied its procedural obligations under the [APA], and properly preempted states from regulating broadband, an inherently interstate service.”
"It's more likely than not the FCC’s decision will be affirmed," said Free State Foundation President Randolph May. The Supreme Court's 2005 Brand X deferring to the then-Title I cable broadband classification was "precisely on point," he said. "The same issues are involved [now] and I see no reason why the court won’t again rely on Chevron deference to affirm the FCC’s decision." The current market "is considerably more competitive and consumers have more choices now," he said. "Petitioners' arguments concerning the lack of competitive alternatives have less merit."
The FCC gets deference to reasonably interpret the statute, not ignore it, countered Wood. He said the commission didn't engage in reasoned decision-making on reclassification, the need for rules, whether there's sufficient competition, if other agencies could "fill the void, and on and on." He said the regulator "abdicated" its broadband role, so states are "trying to step in."
Title II reclassification is contrary to law and not supported by Brand X, partly because the FCC didn't interpret the telecom definition, said Steptoe & Johnson's Markham Erickson, representing Mozilla. Regardless of the classification outcome, elimination of net neutrality regulations is arbitrary and capricious, said Harris Wiltshire's Austin Bonner, lawyer for intervenors challenging the order. She said the FCC (1) didn't have a reasonable basis to conclude competition combined with transparency enforcement would prevent harms; (2) mischaracterized evidence the 2015 order didn't harm ISP investment; and (3) relied on Section 257 as its transparency "linchpin," so if the court rules against that authority, the rest of the order "can't stand."
Business Forward urged Congress Wednesday to reach a legislative compromise on net neutrality, arguing continued delays and partisan rancor hurt U.S. competitiveness. Absent “clear authority from Congress, future net neutrality proposals will remain vulnerable to litigation and a victim of political gridlock at the FCC,” the report said. “The resulting uncertainty represents an ongoing headwind against innovation and investment in the digital economy, and therefore a threat to long-term economic competitiveness.”
The House Communications Subcommittee is expected to set a Feb. 7 hearing to kick off its work this Congress on net neutrality legislation (see 1901280054). Chairman Mike Doyle, D-Pa., told reporters Wednesday an announcement on the hearing was “imminent” but wouldn't talk about the details. House Commerce Committee Democratic members have been considering possible legislation to restore the 2015 rules in statute, including classifying broadband as a Title II service (see 1901100001).
New York Gov. Andrew Cuomo (D) proposed a budget Wednesday include limiting procurement to ISPs that adhere to net neutrality rules (see 1901300034).
Net Neutrality Notebook
It's questionable whether party affiliation of judges can predict Mozilla's outcome, blogged American Enterprise Institute visiting scholar Roslyn Layton: "Concluding that Democratic Party judges will automatically side with policies from those administrations, and vice versa, is unfounded." Patricia Millett and Robert Wilkins on the panel are Democratic appointees; Republican appointee Stephen Williams is the third (see 1901070053).
No "line standers" will be allowed at Friday's oral argument; only people planning to attend will be allowed in line, the D.C. Circuit said. Courthouse doors open at 7 a.m. and seating is first come, first served. There will be an overflow room with an audio-video feed, plus livestreaming for non-attendees.