Court Strikes Down Open Internet Rules: What Now?

A federal appeals court sent the FCC back to the drawing board on Internet neutrality today, striking down the agency’s Open Internet Rules. The decision is a real loss for US Internet users; the rules offered an important safeguard for keeping the Internet the remarkable engine for free expression, creativity, and innovation that it is. The upside, though, is that the decision also suggests that the thing really tying the FCC’s hands in this area is neither the Communications Act nor the Constitution, but rather the FCC’s own prior decisions regarding how to classify Internet access service. Far from putting Internet access services and Internet neutrality entirely outside the FCC’s purview, the decision effectively puts the ball back in the FCC’s court.

The court struck down the Open Internet Rules’ central feature, the requirements that ISPs not unreasonably block or discriminate in how they treat their users’ Internet traffic. Without corrective action by the FCC, the loss of these provisions will invite fundamental changes in the way the Internet works. The rules, designed to preserve the status quo, ensured that consumers would continue to have access to the full Internet without tampering or favoritism. Now ISPs may distort that environment, favoring certain content or uses of the network over others. A shift to non-neutral Internet access would also threaten innovation, competition, and the nature of the Internet as we know it. Without a non-discrimination rule, the unfettered environment for individual free expression and innovation without permission that has defined the Internet for decades is at risk.

The problem, in the eyes of the court, is that the anti-blocking and nondiscrimination rules effectively placed “common carrier” obligations on ISPs – a no-no since the Communications Act prevents the FCC from imposing such obligations on entities that aren’t officially classified as common carriers. In a politically charged deregulatory decision back in 2005, the FCC ruled that ISPs are not common carriers subject to regulation under Title II of the Act. That decision, which went all the way up to the Supreme Court, has had lasting reverberations; as outlined in detail by the court today, it continues to be a barrier to the enactment of meaningful rules to protect Internet neutrality.

The court’s decision today is all the more disappointing because the FCC had in fact bent over backwards to avoid placing ISPs under a full common-carriage regime. While the Rules were being developed, the FCC opened a parallel proceeding to consider reversing the earlier decision and placing Internet access service under Title II (while forbearing from imposing the bulk of Title II’s regulatory burden – an approach CDT supported). Instead, the FCC proceeded under a bit of a compromise that stopped short of reclassification. All for naught. Verizon nonetheless took issue and challenged the Rules, and today’s opinion effectively negates the FCC’s attempt to compromise.

The good news in this ruling is that the court did not say that Internet access service is totally out of bounds for the FCC. Indeed, it largely did the opposite.

First, the court steered clear of Verizon’s outrageous First Amendment argument that ISPs have a right to “edit the Internet” they offer to their customers. Rebutting this distorted view of the First Amendment’s relationship to the Internet was the focus of CDT’s amicus brief in the case. By raising such an audacious constitutional argument, Verizon sought to wall off the provision of Internet access from not just these rules, but any regulation whatsoever. Thankfully, the court did not address the argument, and the FCC is free to continue working in ways consistent with this opinion to ensure that the open Internet endures.

Second, the court actually confirmed the reasonableness of some of the FCC’s core legal and policy determinations from the Open Internet Order. The court held that an existing provision of law (section 706) gives the FCC considerable regulatory authority over broadband Internet access service. Indeed, while CDT believes that FCC authority on Internet matters should be narrow, it would be absurd to have a communications regulator with no authority to work on the most important communications network of our time.

Perhaps most promisingly, the court held that the FCC made a reasonable policy judgment when issuing the rules. The court wrote that the FCC’s conclusion that nondiscriminatory carriage by ISPs creates a “virtuous cycle” that may spur broadband deployment was “both rational and supported by substantial evidence” and that Verizon had shown “no basis for questioning the Commission’s determination that the preservation of Internet openness is integral to achieving the statutory objectives set forth in Section 706.” In short, much of the FCC’s policy reasoning stands.

FCC Chairman Tom Wheeler – some recent confusion notwithstanding – has expressed strong support for Internet neutrality, including reaffirming his commitment to the open Internet in response to today’s ruling. In light of today’s setback, he and his fellow Commissioners should reconsider the agency’s regulatory classification of Internet access service, which would establish a firm legal foundation for Internet neutrality rules and the premise that the Internet should remain an open and level playing field for all users and services.

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