D.C. Circuit Court Upholds FCC Chairman Ajit Pai’s Repeal of Net Neutrality, But Allows States to Fill the Void

WASHINGTON, October 1, 2019 — The Federal Communications Commission’s repeal of Obama-era network neutrality rules will remain, a three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit ruled on Tuesday.

However, in a bit of a split decision, the court said that the agency did not have authority to preemptively ban states from passing their own versions of net neutrality legislation.

The panel largely rejected a challenge to new rules which reclassify broadband internet as an information service, rather than a common carrier akin to telephone service.

The ruling appeared to put an end to efforts by public interest advocacy groups and some internet companies to overturn the reclassification of broadband internet service.

In December 2017, FCC Chairman Ajit Pai led the Republican commissioners to overturn the agency’s February 2015 decision to prohibit broadband providers from blocking or throttling particularl types of internet traffic.

“We hold that classifying broadband Internet access as an “information service” based on the functionalities of DNS and caching is “‘a reasonable policy choice for the [FCC] to make,’” the court wrote in a unanimous opinion. The decision relied heavily on case law – so-called Chevron deference after a Supreme Court case by that name from the 1980s — requiring courts to defer to agencies’ interpretations of ambiguous statutes.

The plaintiffs’ objections to the reclassification, the court wrote, were “unconvincing for the most part.”

In leaving room for states to enact their own net neutrality laws — by finding that the agency lacked the authority to bar states from enacting rules more stringent than the FCC’s requirements — some aspects of the decision cheered advocates of net neutrality. The court also required the FCC to more fully consider the needs of public safety users.

In a statement, TechFreedom President Berin Szoka applauded the court’s decision, but noted that it leaves room for a future Democratic-majority FCC to reinstate the Obama-era rules and shift the long-running battle over network neutrality to state legislatures and case-by-case court battles.

“Today’s decision vindicates the RIFO, but Chevron deference to the Republican FCC’s interpretation will likely be tomorrow’s Chevron deference to the next Democratic FCC’s interpretation,” Szoka said. “So this issue will remain a political football for the foreseeable future, unless and until Congress finally writes into statute the open Internet principles that virtually all parties have agreed on since 2004.”

Internet Innovation Alliance Co-Chairs Rick Boucher, Bruce Mehlman, and Kim Keenan also lauded the ruling, which they said “deserves applause from everyone who wants to see an expansion of innovation, competition and investment in the internet ecosystem.”

“But ruling that the FCC can’t block state laws and thus allowing rules that differ among all 50 states could spell disaster for advancement of the internet, as web services are offered on a national basis, and many would be disrupted by a multiplicity of diverse and contradictory state net neutrality requirements,” they added.

“Unless Congress codifies nationwide open internet rules, including the designation of broadband as an information service, we will very likely see continuation of the ping-pong at the FCC between classifications of broadband as an information service and as a telecommunications service.”

Also speaking out in favor of the decision was US Telecom CEO Jonathan Spalter, who said in a statement that the court “got it right and affirmed what anyone who has been paying attention to Washington’s net neutrality saga knows to be true: the internet is open, ISPs are investing to bring internet users the content they want, and we remain absolutely opposed to anti-consumer practices like blocking, throttling and anti-competitive paid-prioritization.”

Sen. Ed Markey, D-Mass., a longtime network neutrality proponent, said in a statement that the court’s decision “leaves the future of the free and open internet in question.”

“When I attended the net neutrality court hearing earlier this year, I heard the FCC and broadband industry use tortured logic to defend the repeal of net neutrality and undermine strong rules for an open internet,” Markey said. “Sadly, today’s court opinion doesn’t reflect the clear reality that Americans rely on the internet the way they rely on electricity or telephone service.

But at the FCC, the court’s decision providing something for everyone.

In dueling press statements, both Republicans and Democrats at the FCC claimed victory.

Said the Republican Pai, ignoring the criticisms of the ruling made by the three judge panel:

“Today’s decision is a victory for consumers, broadband deployment, and the free and open Internet.  The court affirmed the FCC’s decision to repeal 1930s utility-style regulation of the Internet imposed by the prior Administration.  The court also upheld our robust transparency rule so that consumers can be fully informed about their online options.  Since we adopted the Restoring Internet Freedom Order, consumers have seen 40 percent faster speeds and millions more Americans have gained access to the Internet.  A free and open Internet is what we have today and what we’ll continue to have moving forward.  We look forward to addressing on remand the narrow issues that the court identified.”

Commissioner Geoffrey Starks, a Democrat highlighted the fact that states remain free to pass net neutrality legislation:

“Above all else, today’s decision breathes new life into the fight for an open internet.  It confirms that states can continue to step into the void left by this FCC.  To that end, it is a validation of those states that have already sought to protect consumers, and a challenge to those that haven’t yet acted to think hard about how to protect their citizens.  More pointedly, the decision affirms that the FCC ignored key aspects of its mission with regard to public safety and broadband deployment.  And the decision admonishes this Commission for its failure to consider the impact of its action in this context on Lifeline, a critical program that makes broadband more affordable for low-income consumers.”