Attorneys Dispute Net Neutrality, Title II, Court Deference; Offer Projections
Net neutrality sparked familiar divisions but also some projections and legal analysis from attorneys on a Digital Policy Institute webinar Wednesday. While the FCC’s order faces many court challenges, Andrew Schwartzman, Georgetown Institute for Public Representation senior counselor, said he believes judges will likely focus on the commission’s authority to reclassify broadband as a Title II telecom service under the Communications Act and accord the agency’s view deference. But Brent Skorup, a George Mason University telecom research fellow, and Stuart Brotman, a University of Tennessee electronic media professor, questioned FCC deference in this case. Skorup suggested the commission was vulnerable on First Amendment grounds, but Schwartzman was skeptical. The three speakers did agree Congress is unlikely to pass a legislative compromise for now.
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Skorup said Title II is the FCC’s “most powerful regulatory weapon." He said it opens the door for the FCC to assess whether broadband rates and practices are “just and reasonable,” and possibly require telco/cable ISPs to share their networks with competitors and pay for USF subsidies. He said broadband providers have good reason to be wary of Title II because of the need to manage Internet services that are “much more” complex than traditional phone services. A cell tower that can serve up to 1,000 users can quickly get overloaded if just three people start streaming data-heavy video, he said.
Schwartzman called those concerns a “parade of horribles” because the FCC made clear it was forbearing from applying Title II regulation to broadband rates, among other things. Schwartzman said a core purpose of Title II is to ensure telecom networks benefit the public by providing nondiscriminatory service. Broadband ISPs said they weren’t opposed to network neutrality rules requiring transparency and prohibiting Internet blocking and throttling, he said: The argument isn't whether the goals are good; it’s whether Title II should be applied.
Schwartzman suspects broadband Title II reclassification will be “the centerpiece” of the upcoming net neutrality ruling by the U.S. Court of the Appeals for the D.C. Circuit, despite the order being challenged on other grounds. He said the D.C. Circuit homed in on FCC statutory authority under communications law in two previous net neutrality cases (Comcast in 2010 and Verizon in 2014). He said the Supreme Court's Brand X ruling deferred to the FCC’s previous classification of cable broadband as a Title I service, but the commission was free to change its mind as long as “it has good reason for doing so,” which he said it did in this case. The high court already ruled the statute is ambiguous, entitling the agency to deference, which "I expect to control on that issue," he said.
Skorup said the question was whether the broadband Title II finding was reasonable, particularly in light of Sections 230, 231 and 620 of the Act, which he said suggested a different finding. Brotman acknowledged the traditional two-step Chevron doctrine: first, if the statute is clear, the agency gets no deference and must implement congressional will; and second, if the statute is ambiguous, the court will give reasonable agency interpretations deference. But he suggested the court would first apply Chevron “step zero” and examine whether the agency was exhibiting “erratic behavior” and reversing itself without adequate explanations. He also said that under a NARUC case, the court could look at network “functionalities,” and viewed through that lens he said broadband looks more like an information service than a telecom service.
Schwartzman said Justice Antonin Scalia’s Brand X dissent concluded cable broadband was clearly a telecom service. “So the FCC starts out with a head start in the Supreme Court,” he said. But he said he isn't sure the D.C. Circuit panel’s decision, which is expected in the first half of 2016, will even make it to the high court, given the absence of a circuit split. The Verizon ruling looked more like a “garden-variety administrative law case,” he said.
Skorup noted the FCC doesn’t get deference on constitutional issues and some challengers argue its rules violate free-speech rights. He said he believed the commission has a “fairly tough road” to convince the court that the First Amendment doesn’t apply to broadband providers, particularly when they're already filtering Internet traffic for customers concerned about porn, gaming and other objectionable content. Both he and Brotman acknowledged the D.C. Circuit could well decide the case on other grounds to avoid the constitutional question. But Skorup said the First Amendment would be “in the back of the minds” of the judges, and Brotman said a First Amendment ruling would invite Supreme Court review.
Schwartzman said he believes the FCC is on “very strong” First Amendment grounds. ISP delivery of Internet content is more analogous to a phone call, not radio or TV, in that ISPs are basically “delivering electrons,” he said. That broadband providers filter some objectionable content doesn’t transform them all into “speakers,” he said. A Verizon website is protected by the First Amendment, but Verizon has no business interfering with consumer decisions on which websites to visit, he said. But Skorup said ISPs do “curate” content. “Just because it’s automated doesn’t mean it’s not speech,” he said. Brotman said the Supreme Court's Reno decision on the 1996 Telecom Act's communications decency provisions found government Internet content restrictions are subject to “strict scrutiny,” requiring a “compelling state interest.”
Schwartzman said the chances of a net neutrality legislative compromise are “very low.” Brotman agreed it was “very difficult” for Congress to pass such legislation with a presidential election approaching. Skorup basically agreed, saying the issue had become heavily politicized. Congressional Democrats might be more willing to deal if the FCC legal position is undermined in court at oral argument Dec. 4 or by a subsequent adverse ruling, but Republicans might then balk, he suggested.