FCC's Net Neutrality Rules Face Tough Legal Questions

A sharply-divided Federal Communications Commission today passed net neutrality rules, but may have a difficult time defending its actions in court.

The new rules prevent broadband service providers from blocking legal content, services or applications, and from discriminating "unreasonably" against traffic on their networks. For mobile broadband, which the FCC said is in an earlier stage of development, the rules are not as strict.

Legal challenges are all but certain, the FCC commissioners noted themselves.

“The FCC does not have the legal authority to issue these rules,” Commissioner Robert McDowell said flatly. “This new order will fail in court.” A Republican, McDowell voted against the rules, noting that the winter solstice – today - is “the darkest day of the year. This may be one of the darkest days in FCC history.”

For the FCC, coming up with legal authority to justify the move was not a simple undertaking.

In April, the U.S. Court of Appeals for the D.C. Circuit in Comcast Corp. v. FCC unanimously ruled that the FCC lacked the authority to regulate the network-management policies of Internet service providers under a theory of "ancillary" jurisdiction. The problem, the court found, was that the FCC did not explicitly tie its assertion of ancillary authority to its statutorily mandated responsibilities.

Today, FCC General Counsel Austin Schlick said that the agency has jurisdiction to act under Section 706 of the Telecommunications Act of 1996, which urges the agency to promote “advanced telecommunications” services.

Republican Commissioner Meredith Attwell Baker didn’t buy it. In voting against the rules, she said that the FCC was acting as a legislator, not a regulator. “Section 706 is not an independent grant of authority,” she said. “The majority replaced the ancillary authority rejected by the Comcast court with equally unbounded direct authority.”

Even Democratic Commissioner Michale Copp, who voted (reluctantly) for the rules, took issue with the legal underpinnings. “We do not anchor ourselves to what I believe to be the best legal framework,” he said. “I pushed as hard as I could to get broadband back where it belongs, under Title II.”

The FCC regulates telephone service under Title II of the Communications Act — a regime that includes rules about pricing and competitor access. Jenner & Block partner Samuel Feder, who was general counsel of the FCC from 2005 to 2008, called reclassifying broadband as a Title II service “the nuclear option.”

To Duane Morris partner Glenn Manishin, using Section 706 to justify broadband regulation is “inane.”

“The commission in the 1990s ruled over and over again that 706 was not a basis for regulatory power. This means that using 706 as the nexus for ancillary jurisdiction will necessarily stoke a hotter fight over the FCC’s reversal of its statutory interpretation, a double whammy.”

Comments

[James J]

Did I miss something? Both ends of the pipe, the consumer and the content provider both pay for bandwidth. We have the slowest and most expensive internet access amongst the major industrialized nations.

The conspiracy theorist in me thinks this ia a power grab that will enable censorship on the grandest scale imaginable. If all these rules that the providers want were in place, whats to prevent them from reducing the speed of Wikileaks traffic to dial-up speeds or make MSNBC unwatchable while Fox runs at full speed.

But the realist understands that this is just the greed of corporations. I already pay $176 a month for cable and internet access, 99% of which I dont want or need.

Save me from yet another home shopping network. Im sure they will never have their bandwidth reduced.

[David Crow]

I don't think government-sanctioned monopoly phone companies or cable companies should be allowed to leverage their power and position as monopolies in disputes in general and the internet in particular.

An example is Comcast's dispute with Level 3 Communications where Comcast is indeed trying to leverage its monopoly status in its dispute with Level 3.

Monopolies must be closely monitored by the appropriate government entities to prevent monopoly abuse.

David Crow

[Larry Smith]

James, I must be missing something.I'm positive service providers are already charging premium prices for faster speeds.

I think the issue is the advent of services like Netflix streaming video, 100,000 videos, downstream across a network designed for transactions and bursty data. Additional facilities (bandwidth)is inevitable. Follow the money. Who do you think is going to pay for those new facilities. Do you think the telephone and/or cable companies are going to volunteer to quadruple their facilities to support competitive video streaming services? All they have to do is stop building out to demand and the deck of cards comes tumbling down. IF I'm missing something here let me know.

[Willie d'Whisk]

The FCC needs to step up and stop letting monopoly powers run the show. There is not reason to allow private companies to place toll booths up on what is a public road.

Privatization and market based solutions at every turn are a lie. Roads and bridges do not work better when private companies collect rent on them.

These resources-- the copper and such have been paid off by THE PUBLIC for decades!

Netflix should not have to go bankrupt because cable companies can't offer compelling product/services.

I hate my slow cable remote-- and the price just goes one way, right?

[James]

Exactly what type of rules are the FCC trying to put into place. I had heard on a talk show earlier today that they wanted to regulate the speeds of Internet users, allowing providers to charge premium services for different speeds of Internet use.