FCC General Counsel Gets Tough Questions at D.C. Circuit Court’s Net Neutrality Hearing

WASHINGTON, February 2, 2019 — Network Neutrality once again took center stage Friday as the Federal Communications Commission found itself defending its repeal of Obama-era Open Internet rules before a three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit.

Friday’s oral argument was the most recent of many partisan clashes between the advocates of the FCC position under former Chairman Tom Wheeler, a Democrat, and that of current Chairman Ajit Pai, a Republican. Now, the agency  is defending its December 2017 Pai rules before the D.C. Circuit Court of Appeals.

On a 2-1 vote in June 2016, a three-judge panel of the appeals court upheld the February 2015 Wheeler net neutrality rules. That decision was reviewed en banc by the entire appeals court, and upheld in May 2017 (see below).

Following the 2016 presidential election and the shift from majority-Democrat to a majority-Republican FCC, Pai announced that the agency would re-reclassify broadband as an “information service,” rather than the “telecommunications service” under the Wheeler rules.

The lawsuit, led by the Mozilla Foundation and others seeking to judicially overturn the 2017 Pai rules,  was joined by more than 36 pro-Network Neutrality interest groups and entities, including the California Public Utilities Commission, Public Knowledge, and the Benton Foundation.

Legal arguments about the definitions of ‘telecommunications’ and ‘information’ services

FCC General Counsel Thomas Johnson spent much of the four-hour oral argument session trying to convince judges that the FCC was correct in its decision that broadband internet did not fall under the legal definition of a “telecommunications service” — “the transmission, between or among points specified by the user, of information of the user’s choosing, without change in the form or content of the information as sent and received.”

Instead, he argued that broadband was an “information service,” defined under U.S. law as “the offering of a capability for generating, acquiring, storing, transforming, processing, retrieving, utilizing, or making available information via telecommunications.”

When Circuit Judge Patricia Millett — an appointee of President Barack Obama — noted that the inclusion of the phrase “via telecommunications” in the latter definition implied that an “information service” is something offered in addition to the transmission of information, Johnson suggested that broadband was an “information service” because providers offer Domain Name System services to allow users access to remote services by way of a domain name (e.g. Wikipedia.org) rather than by a hard-to-remember Internet Protocol address.

“DNS, for example, it generates queries to other servers, it stores and retrieves domain name information, it translates domain name information that is provided by the user into an IP address and back,” Johnson said.

But Millett remained skeptical and continued to press Johnson on why telephone service, which she noted “is constantly used to acquire information and share information,” is still considered a “telecommunications service” for regulatory purposes.

“It seems to be the exact same functionality, but one is voice and one is typing,” she said.

Did the FCC’s decision to lift bans on blocking and throttling affect public safety?

Another matter of contention during Friday’s arguments was whether the FCC’s ending of a ban on blocking or throttling of internet traffic fell afoul of the commission’s requirement to consider the impact of its rules on public safety.

This issue was raised by Danielle Goldstein, the attorney representing Santa Clara County, California, which joined the suit after firefighters responding to last year’s wildfires saw their internet access throttled by Verizon.

Noting that the FCC’s authority to preempt state and local laws regulations does not absolve it from its responsibility to consider the public safety impact of its rulings, Goldstein said: “The FCC can’t fail to address public safety, especially in an order that purports to preempt state and local government’s ability to fill that regulatory gap,”

When Johnson suggested that the burden of proving harm from the regulations would rest with public safety agencies, Millett took on an irate tone as she interrupted him: “Why is the burden on them?” she asked.

“The statute repeats again and again that public safety is an important goal, you had comments [from the public] expressing concerns, a lot of them. It seems like you have a statutory obligation, you had a lot of comments, a serious issue that should have been addressed by the commission in the order.”

Judge Robert Wilkins, another Obama appointee, noted that the broad language the FCC used in its reclassification order seemed to prohibit a state from restricting broadband carriers’ ability to throttle service to public safety personnel like firefighters.

“Your order would seem to prohibit that [hypothetical law] because your order is written very broadly,” Wilkins said. “Doesn’t it say that basically all state and local regulations with respect to broadband are preempted?”

While Williams did not directly answer Wilkins’ question, he said the FCC was not trying to impact public safety functions, adding that whether a particular state law would be preempted “would depend on the facts of that particular case.”

Further questions about whether the Obama-era rules stymied infrastructure investment

Johnson also had trouble convincing Millett that the FCC’s claim that the Obama-era rules stymied infrastructure investment by broadband carriers was accurate, after she pointed out that providers had told investors the exact opposite of the FCC’s claim.

After Johnson called the providers’ statements “ambiguous,” Millett interjected again: “What is ambiguous about, ‘it’s not going to affect us, we’re going to keep going ahead [with investment]?’” she asked, adding that companies’ statements to investors “have to be true.”

“It’s almost like someone doing something under oath. That’s pretty good evidence, if there’s a penalty if they’re lying or even engaging in misleading puffery,” she said.

Only the latest of many legal maneuverings regarding net neutrality

The third judge on the panel considering Mozilla Foundation v. FCC is Senior Judge Stephen Williams, who dissented from the 2-1 majority that ruled for the Wheeler FCC in the 2016 case US Telecom v. FCC.

The two other judges in that case, David Tatel and Sri Srinivasan, were also Democratic appointees. When the matter went for an en banc review, Tatel and Srinivasan penned the majority opinion against overturning the panel’s decision.

Of the 11 full-time judges on the court at that time, eight participated in the review. Most notable were the two judges who dissented from denying the review: Janice Rogers Brown and Brett Kavanaugh, each of whom penned extensive opinions. Other than Tatel and Srinivasan denying review, and Brown and Kavanaugh favoring review, the positions of the other four judges who participated were not released — other than the fact that a majority denied review.

While the decision denying review was considered a minor victory by advocates of net neutrality, at that time the Pai FCC was already deep into its reconsideration of the Wheeler regulations. The agency effectively under a 180 degree turnabout — lifting the Wheeler rules and effectively eliminating all net neutrality protections except for transparency rules — in December 2017.

It is that new rule-making that is the subject of the new three-judge panel’s current judicial review of FCC regulations.

(President Barack Obama delivers a statement announcing the nomination of three candidates — now judges — on the U.S. Court of Appeals for the District of Columbia Circuit, in the Rose Garden of the White House, June 4, 2013. Nominees from left are: Robert Leon Wilkins, Cornelia “Nina” Pillard, and Patricia Ann Millett. Official White House photo by Chuck Kennedy.)