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The DC Circuit Court Likely to Protect & Preserve Corporate Broadband Control

Phillip Dampier January 21, 2010 Comcast/Xfinity, Net Neutrality, Public Policy & Gov't 6 Comments

DC Circuit Court

Once again, the United States Court of Appeals for the District of Columbia Circuit is proving to be the best friend corporations have to unravel regulatory policy and consumer protection laws that might violate corporate free-speech or trade rights.  It has become a favored venue for telecommunications providers who want to be rid of pesky prohibitions or reasonable regulation.

After a series of arguments, universally considered disastrous for the Federal Communications Commission’s authority to regulate broadband, the cable operator may want to send flowers to the Court… a lot of them.

Earlier this month, attorneys for the FCC defended their right to tell Comcast it cannot throttle its customers’ broadband speeds.  The FCC maintains it has regulatory authority over broadband service, claiming such power could be inferred from Title I, Section 230(b) of the Communications Act, which states that it is the policy of the United States “to preserve the vibrant and competitive free market that presently exists for the Internet” and “to promote the continued development of the Internet.”  From that the FCC wrote a policy statement stating it was, “necessary to ensure that providers of telecommunications for Internet access or Internet Protocol-enabled (IP-enabled) services are operated in a neutral manner.”  That was the basis for their crackdown against Comcast’s speed throttle.

After the arguments between Comcast and the FCC concluded, court-watchers believe the Commission’s days of broadband oversight are numbered.

Ars-Technica’s Matthew Lasar documented the probable train wreck for those who seek to rein in provider abuses.

At issue is whether the FCC has been granted direct legal authority for Internet regulation by Congress. Comcast, and as it turned out many on the Court, believe the FCC is relying on policy statements, not written law, for their regulatory authority over Internet Service Providers.  The Court transcript says it all:

Randolph

“In looking this over I found a good many situations in which Congress has instructed the FCC to study the Internet,” said Justice A. Raymond Randolph, [appointed to the Court by President George H.W. Bush in 1990], “and taxation of transit sales transactions on the Internet, and this, and that, and the other thing. But what I don’t find is any congressional directive to the FCC to regulate the Internet.”

It wasn’t hard for [Comcast attorney Helgi G.] Walker to summon a response to this observation. “That’s right,” she declared.

And with that, Comcast had won. Even before the FCC’s attorney got to the bench, the judges were doing Walker’s job, swatting aside arguments on behalf of the agency’s Order sanctioning the ISP. Pro-FCC briefs to the court had noted that the Supreme Court recognized the Commission’s ancillary authority in its Brand X decision, a crucial ISP access case. Randolph threw this bullet point into the trash icon, referring to the “offhand statement” in Brand X. “And the Supreme Court has moved so far away from that kind of an analysis in today’s modern jurisprudence,” he added, “it seems antiquated.”

By the time Commission lawyer Austin C. Schlick began his rebuttal, Randolph moved in for the kill.

“May it please the Court,” Schlick began. “Ms. Walker hasn’t attempted to defend the actual network practices that were employed here, and so I won’t spend time just… ”

Sentelle

[Justice David] Sentelle cut him off. “Well, her position is that she doesn’t have to,” he tersely noted. “She’s here to say that you don’t have any business inquiring into those practices, ergo we don’t either.”

That’s true, Schlick conceded. “Right,” Sentelle warned. “So you may want to move on to something that’s at issue then, Counsel.”

And that was largely that.  The Court is very likely to hand down a ruling that strips the FCC of its ability to regulate or oversee broadband service in the United States.  Even Schlick knew what has forthcoming:

By the end of the discussion Schlick was bargaining with the judges. “If I’m going to lose I would like to lose more narrowly,” he confided. “But above all, we want guidance from this Court so that when we do this rule-making, if we decide rules are appropriate we’d like to know what we need to do to establish jurisdiction.”

“We don’t give guidance,” Randolph grumbled, “we decide cases.”

Comcast should have bought lunch for everyone.

So now public policy groups and advocates of FCC oversight over broadband, particularly as it relates to Net Neutrality, are scrambling to figure out what to do next.

It comes down to four possible outcomes:

  1. One of the parties appeals the case;
  2. Corporate control of broadband without oversight is assured, as the FCC is stripped of any regulatory authority;
  3. The FCC manages to find some other wording from laws Congress passed that justifies lawmakers wanted the agency to oversee and regulate broadband services;
  4. Congress passes new laws specifically enacting broadband regulatory authority for the FCC.

Of course, today’s bland authority over broadband comes as a result of legislative compromise from the great regulatory battles over telecommunications during the Clinton Administration.  Providers argued less is more, and have grudgingly accepted limited FCC authority over some of their services, except when a challenge threatens to cost them control or a lot of money.

With a hostile reception at the Court, and the FCC’s “surrender first, fight later” legal argument, an appeal may only delay the inevitable.  The FCC does have plenty of Congressional directives to review which may permit it to enact Net Neutrality protection, but another provider lawsuit opposing Net Neutrality is inevitable.  In fact, without the passage of a clear, concise federal law providing the Commission with explicit broadband regulatory authority enacting Net Neutrality and other protections, the aptly-numbered “2” is the likely outcome for consumers.

Thankfully, Rep. Edward Markey’s (D-MA) Internet Freedom Preservation Act would solve much of this problem, by forbidding Internet service providers from doing anything to “block, interfere with, discriminate against, impair, or degrade” access to any lawful content from any lawful application or device.

Getting it passed in a Congress mired in division is another matter.  The best way to overcome that is a strong showing of support for Markey’s legislation in calls and letters to your members of Congress, and that you are carefully watching their votes on this issue.

Currently there are 6 comments on this Article:

  1. KC says:

    News like this makes me really mad. I don’t see how anyone could side with Comcast on this issue considering consumers can easily be hurt by this. Clearly these people care nothing for consumers and only for rich businesses. Typical.

    All I see are old rich men making these assertions about how the internet should be usage based, how it should be unregulated. Of course they don’t care if its capped and if they have to overpay for an inferior service. They are rich and they don’t even use it or barely know how. It means nothing to them.

    I’m sick of senators, judges all making whatever choice hurts people and helps business. You can bet if a democrat introduces internet oversight laws it will be the same mess as with healthcare, where all the republicans will vote against it just cause a democrat wants it. Markey will need a lot of help, poor guy.

    Not to mention today’s supreme court ruling that now allows corporations to spend unlimited money backing a candidate, all these telecom companies can waste our money to try to get anyone who isn’t pro-telecom out of office. Oh I wish I had enough fists for all the faces I want to punch right now!

  2. Patrick says:

    In response to this article and to KC – I’m at a point right now where I just feel saddened by the way this type of behavior not only happens right before our eyes, but that there are tens of millions of people who blindly accept whatever their “party” tells them. I don’t care if you describe yourself as a conservative or liberal – how can anyone with a rational mind and a patriotic heart buy into the virus that is “opposition to anything that is considered good to the consumer”? To KC’s point – poor Markey has already lost because the “republicans” will do anything they can to stop a Democratic initiative – no matter what. And all the millions of “folks” who watch Fox News every night will somehow buy into the rhetoric that providing consumer protection is somehow “socialist” and “supporting big government”.

    How did we get to the point that “big government” is vilified yet “big corporate” has been painted as a hero? How is it that the very “folks” who would benefit the most from more consumer protection and better healthcare are the same “folks” that rally against those very things?

    What happened? I like to think that the manipulative practices of certain uber-popular media corporations are partly to blame, as well as all the politicians to have sold their values to buy right into the act – but how can people lack the willpower to do any sort of research on facts themselves?

    What happened?

    • KC says:

      I don’t know how it happens either, but the only thing I can think of is that people are just stupid enough to let it happen. Not only that but they are stubborn and will ignore any evidence that they’ve been taken advantage of. I could go on but I don’t think I need to. I do know that politicians and corporations are fully aware of how stupid the average person is (though politicians are often just as stupid) and they are experienced in catering to them to get them on their side.

      I too will support Markey’s bill, and hoping no crazy people on TV notice it and bring attention to it by crying while explaining how this new regulation is going to reduce the country to ash.

  3. Michael Chaney says:

    This is definitely a blow to consumer protection, but in some way I feel it was necessary. By saying that the FCC’s guidelines (not rules) are weak and unenforceable and that Congress didn’t grant them the power to make rules regarding the Internet, the court made it clear that Congress, not the FCC, is where this fight needs to go.

    Our efforts have somewhat been divided over the last year. We had FCC initiatives to support and weigh in on, and we had some early attempts at legislation to maybe possibly support if necessary. Well folks, I think our marching orders are clear. I intend to not waste anymore time submitting filings to the FCC. Instead I’m going to direct all my efforts toward building support for Markey’s bill and writing my congressmen.

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