Blumenthal Expects Significant Changes to be Offered at Section 230 Bill Markup

Expect “significant” proposed changes when the Senate Judiciary Committee marks up the Earn It Act, Sen. Richard Blumenthal told us Thursday (see 2006170063). “I’m ready for a markup, which will include some changes, some of them significant, to clarify the provisions in light of the feedback."

Chairman Lindsey Graham, R-S.C., told us he’s ready to advance the bill with Blumenthal. The Connecticut Democrat separated the legislation from the Trump administration’s approach to Section 230 of the Communications Decency Act. “Ours is very narrowly targeted, carefully considered, and it should never be conflated with the administration’s meat ax attempt to suppress free speech,” Blumenthal said. Blumenthal added that he's intent on preserving encryption, while stressing the attorney general’s limited role in implementing the law (see 2003110070), which have been points of criticism from opponents.

The First Amendment is going to be "a massive ceiling" on whatever rulemaking the FCC might undertake on Section 230 (see 2006110065), NCTA President Michael Powell said on C-SPAN's The Communicators, to have been televised this weekend. The commission also has a longtime aversion to being drawn into electoral politics, he said. The FCC can offer some interpretation on 230, but whether that interpretation has binding force on a court is questionable, he said. That interpretation might also not have much practical result on changing social media platform behavior, he said. He said the agency likely would at least put out something for comment, but what comes next is less clear, he said, saying "an expeditious or bombshell decision" seems unlikely.

Section 230 is overdue for a policy review, though, because social media giants operate far differently from mere bulletin boards, Powell said: "They don't need this subsidy" given their huge role in the economy.

Blumenthal said another legislative area he’s exploring is price-gouging. Congress should decide whether a federal price gouging statute is warranted in light of COVID-19, FTC Chairman Joe Simons wrote in a May 19 letter. We obtained it through a Freedom of Information Act request.

Simons responded to an April 14 letter from Blumenthal, ranking member of the Senate Consumer Protection Subcommittee and Chairman Jerry Moran, R-Kan., raising concerns about COVID-19 price gouging. “There is no federal price gouging statute, which maybe we should be considering. I’ll be all in favor of it,” Blumenthal told us. “We’re certainly thinking about” a proposal. Moran’s office didn’t comment Friday.

Simons noted this is “an unparalleled global disaster,” and “extraordinary times may require extraordinary responses.” But he said the FTC Act isn’t a good fit, suggesting Congress decide whether a federal statute is necessary. He noted 35 states enacted price gouging laws. “Congress would need to enact new legislation before the Commission could effectively address the price gouging concerns raised in your letter,” Simons wrote.

If Congress pursues legislation, it could be narrowly tailored to national supply shocks and limited to “clearly defined crises,” such as COVID-19, Simons wrote. He recommended a clearly defined trigger for commission action, such as a specific percentage increase over “pre-shock prevailing market prices.” He said charging the FTC with price gouging enforcement would require additional resources at the commission.

The agency didn’t comment now.