On April 25, 2024, the FCC adopted an Order in Docket 23-230, reinstating Net Neutrality as the law of the land. Unless it is stayed by a court, the Order will take effect on July 22, 2024. In the Order, the Commission reclassifies broadband Internet access service as a Title II telecommunications service, forbids blocking, throttling or paid prioritization of Internet traffic and reestablishes a general conduct rule for Internet behavior. In other words, all aspects of an ISPs Internet service could soon be under government control, including pricing, terms, and conditions of all services. ISPs will be regulated as if they were public utilities such as electric companies. As expected, ISPs have not quietly accepted the Commission’s actions.
On May 31, 2024, USTelecom – The Broadband Association, NCTA – The Internet & Television Association, CTIA – The Wireless Association, the Wireless Internet Service Providers Association, ACA Connects – America’s Communications Association, the Florida Internet & Television Association, MCTA – The Missouri Internet & Television Association, the Ohio Cable Telecommunications Association, the Ohio Telecom Association, and the Texas Cable Association (together, Petitioners) filed a petition (Industry Stay Petition) with the FCC seeking to stay the Order pending judicial review. The petitioners asserted that:
[T]hey are likely to prevail on the merits that the Order is unlawful under both the major-questions doctrine and ordinary principles of statutory interpretation. Petitioners also claim that the Order will impose significant, unrecoverable costs once it goes into effect. They assert that the balance of the harms and the public interest support a stay because “[t]he record does not suggest that the rules imposed by the Order are necessary to address significant present or near-term harms to the public,” and that “the public would benefit from stability in the regulatory treatment of the broadband industry pending final determination of the Order’s legality.” Petitioners “request that the Commission rule on this stay petition by June 7, 2024, to give [them] time to seek a stay in the court of appeals, if necessary, and to give the court of appeals time to adjudicate the stay before the Order takes effect. (Industry Stay Petition, at para. 1-3.).
The ISPs expected their Petition to be rejected by the FCC and the Commission did not disappoint. On June 7, 2024, the agency released an Order denying the Stay Petition. The Commission contended that the ISPs have not shown that they will prevail on the merits of their Petition, since there are ample reasons to classify broadband Internet access service as a telecommunications service and the “major questions” doctrine should not be invoked. However, even if a court questions whether Congress authorized the FCC to conclude that ISPs should be regulated under Title II, petitioners ignore that “BIAS providers have previously been regulated under Title II,” including from 2015 to 2018, as well as the scope of forbearance adopted in the Order.
Likewise, Petitioners’ characterization of the economic and political significance of the Commission’s action as “staggering” is exaggerated because they make general statements about the economic value of the broadband industry, the importance of the Internet, and political debates about Commission authority, rather than specific claims about the effect of the Order. Petitioners also repeat previous arguments regarding the Commission’s post-1996 Act treatment of “Internet access services” without addressing the Order’s extensive discussion of Commission and court precedent that contradicts that argument. Finally, Petitioners’ claim that the Order “strays into areas well outside the Commission’s ‘comparative expertise’” because it takes account of national security considerations while ignoring not only that “the proper regulatory classification of broadband falls squarely within the Commission’s wheelhouse,” but also that the Commission has “statutory responsibilities to safeguard national security and law enforcement,” as courts have repeatedly recognized. (Order Denying Stay Petitions, at para. 7).
ISPs immediately appealed the FCC” s Order to seven circuit courts ensuring that the case would be handled by a Federal Appeals Court. With multiple courts involved, a lottery was held, resulting in the appeal being transferred to the Sixth Circuit Court of Appeals in Cincinnati. ISPs immediately asked for the Net Neutrality to be stayed while being litigated. The Commission responded by requesting that the case be transferred to the DC Circuit Court of Appeals. The Commission claimed that the DC Circuit is best suited to hear the case since it has heard similar cases before. In truth, the Commission knows that the DC Circuit has found previously that a Title II classification for broadband Internet access service was reasonable under the Chevron doctrine, (i.e., it is reasonable because as an expert government agency the FCC is given deference for its presumed expertise on the issue). ISPs opposed transferring the case under the presumption that the Sixth Circuit will be more sensitive to the recent decisions of the Supreme Court to ignore the Chevron doctrine and limit government power unless an agency is given explicit instructions from Congress. The ISP filing was made on June 18, 2024. At the time of this writing no decision has been made on where the case will be heard or whether the Order will be stayed. We will continue to keep you informed as the Net Neutrality Order winds its way through the courts.