Lawyers Backing FCC Cautiously Optimistic Ahead of Supreme Court USF Case Showdown

WASHINGTON, March 21, 2025 – Lawyers defending the Federal Communications Commission’s authority to manage a longstanding $8.1 billion broadband subsidy expressed cautious optimism Wednesday, one week ahead of March 26 Supreme Court oral arguments in FCC v. Consumers’ Research.

The case will likely shape the future of the Universal Service Fund, which spends billions annually supporting construction and maintenance of rural broadband networks and offering internet discounts for low-income households, schools and libraries, and healthcare centers.

In a rare show of consensus, the case has united telecom industry groups, public interest advocates, and both the Biden and Trump administrations in defense of the FCC’s authority.

“We are on the same side as the telcos, and we are also on the same side as the Trump administration,” said Joey Wender, the new executive director of the Schools, Health, & Libraries Broadband Coalition, during an SHLB webinar this week. SHLB has intervened on behalf of the FCC in the case.

“We were very happy to see the government’s brief last week, in which they... very strongly defended the constitutionality of the statute and of the Universal Service Fund overall,” said Jason Neal, partner at HWG Law and counsel for SHLB. 

In its March 14 reply brief, the Trump administration pushed back sharply against the Fifth Circuit’s July 2024 ruling, which claimed that the USF amounts to an unconstitutional tax. The government called that framing a “strawman” argument and insisted the FCC’s role was well within legal limits.

“If the Universal Service Fund really worked that way, the government would not defend its constitutionality,” Acting Solicitor General Sarah Harris, who will be representing the Trump administration in oral arguments next Wednesday, wrote in the brief. 

The coalition defending the USF will also benefit from an unlikely courtroom ally: Paul Clement, partner at Clement & Murphy, one of the country’s most prominent conservative litigators.

“We have a very beneficial situation in which the telcos have retained Paul Clement to argue… We’re much better off having him on our side,” said Andrew Schwartzman, senior counsel for Benton Institute for Broadband & Society, intervening on behalf of the FCC in the case.

With the three Democratic-appointed justices — Sonia Sotomayor, Elena Kagan, and Ketanji Brown Jackson — expected to side with the FCC, the outcome was expected to hinge on the Court’s center-right bloc.

“I think we can assume that the three Democrats on the Court will start out being much more sympathetic,” Schwartzman said. “The focus really needs to be on what are now known as the middle three justices — the ones who may be persuadable,” Justice Brett Kavanaugh, Justice Amy Coney Barrett, and Chief Justice John Roberts.

“The last thing I would say is that Justice Neil Gorsuch wants to revisit [the] nondelegation doctrine,” Schwartzman said, referencing the constitutional theory that limits how much authority Congress can give to federal agencies.

That theory was central to the Fifth Circuit’s ruling, which found that Section 254 of the Telecommunications Act gave the FCC too much discretion over how to collect and spend USF dollars.

“The argument here is that this is the wrong case to do that,” Schwartzman said. “But [Gorsuch is] probably pretty firm in that view. He has some support.”

SHLB and the Benton Institute have consistently defended the FCC’s authority to administer the USF, intervening in support of the FCC in multiple courts: the Fifth, Sixth, and Eleventh Circuits. 

The coalition and its allies prevailed in the Sixth and Eleventh Circuits, but lost in the Fifth Circuit’s en banc ruling, creating the circuit split that prompted the Supreme Court to take up the case.