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Steve Blum: Hope for California’s net neutrality law, as court upholds repeal of federal rules

 

By Steve Blum
Tellus Venture Associates
Special to Santa Cruz Tech Beat

October 2, 2019 — Santa Cruz, CA

The Federal Communications Commission’s republican majority acted properly and within the limits of its authority in 2018 when it cancelled network neutrality rules approved in 2015 by the then-democratic controlled FCC. Mostly. A three judge panel on the federal appellate court based in Washington, D.C. – aka the DC circuit – issued its opinion yesterday, providing support for California’s enactment of its own net neutrality rules, but otherwise rejecting most of the arguments made by net neutrality advocates.

But not all. The judges overturned “the portion of the 2018 [FCC] order that expressly preempts ‘any state or local requirements that are inconsistent with its deregulatory approach’”. That action could open the door to state-level net neutrality regulations, similar to what the California legislature enacted last year when it approved Senate Bill 822.

The ink on governor Jerry Brown’s signature was barely dry, when a plague of lobbyists and lawyers descended on Sacramento and challenged the new law in federal court. Yesterday’s ruling removes a major pillar of their case – the FCC’s attempt to specifically preempt state-level action – but they still have a general argument to make, based on federal authority over interstate commerce. Winning that argument will be harder though, because the D.C. circuit opinion resolves a regulatory paradox in California’s favor.

Following the decision, the bill’s author, state senator Scott Wiener, tweeted “SB 822 remains intact & isn’t preempted”.

Even so, SB 822 is in limbo. California attorney general Xavier Becerra agreed not to enforce it while the case against the FCC’s net neutrality repeal was underway. Yesterday’s decision is a major milestone, but not necessarily the last word. Becerra issued a press release claiming victory, but it didn’t mention what he plans to do about reviving and defending SB 822.

The appeals court judges also said the FCC has to flesh out some aspects of its net neutrality decision in light of public safety, pole attachment and lifeline program considerations, ruling in some specific respects the agency’s actions were “arbitrary and capricious”. That’ll be a paper-pushing exercise; any changes that result will almost certainly be minor.

But other than that, the D.C. circuit panel said that the FCC’s rollback of net neutrality rules will stand.

The judges cited more than 20 years of precedent – and back-and-forth FCC decisions – regarding how broadband service is or isn’t regulated. The central question was whether congress gave the FCC the authority to make such decisions, and the judges’ answer is yes. They pointed out that they “do not inquire as to whether the agency’s decision is wise as a policy matter; indeed, we are forbidden from substituting our judgment for that of the agency”. The FCC’s decision has to be “reasonable”, though, and the judges determined that it was. Much of the nearly 200 pages of the opinion was devoted to explaining why. One recurring theme was that, in many respects, the republican-majority FCC simply restored previous, widely accepted rules overturned by the democratic-majority in 2015. The judges also rejected arguments that, as a whole, the FCC’s decision was arbitrary and capricious, although they said in some respects the commission’s work “is no model of agency decision making”.

Yesterday’s decision can be appealed, either directly to the federal supreme court, or by asking all the judges assigned to the D.C. circuit to review en banc the ruling made the opinion of the three judge panel. It could yet be a long time before we get a final answer.

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