Before next week’s oral argument on the FCC’s Open Internet rules we discuss why the FCC has the Authority to Make Network Neutrality Rules and what could get in the way.
On Tuesday, Michael Weinberg wrote about why we at PK think network
neutrality is important, and Sherwin Siy explained the actual net neutrality
rules the Federal Communications Commission (FCC) adopted. None of this,
however, will get debated in the courtroom on Monday September 9 when the oral
argument finally happens – at least not officially.
In theory, the reviewing court will focus on two things. Did
the FCC have the authority to make the net neutrality rules? And, even if the
FCC does have the authority, does something else prohibit the FCC from
exercising that authority here?
I say in theory because judges have their own opinions and
the D.C. Circuit is particularly famous for its high level of judicial
activism. But judges can’t come out and say “well, even though the FCC has
authority to do this, we think it’s a bad rule so too damn bad!” That wins you
a quick trip to the Supreme Court, which just last term reminded lower
courts they are supposed to respect the FCC’s authority and defer to its
expert judgment. So while policy
arguments may lurk in the background, here’s what everyone will actually be
talking about in the courtroom.
Why Does The FCC Have
The Authority To Make Network Neutrality Rules?
Administrative agencies get their authority from Congress. That
can be a very specific and narrow instruction (e.g. ‘keep people from sending
junk faxes’) or a very broad general instruction (e.g., ‘make sure all
broadcasters ‘serve the public interest’).
Congress doesn’t have to explicitly say “go come up with
network neutrality rules” for the FCC to have authority. At the same time,
however, the FCC can’t just make something up. There has to be something in the
Communications Act that the FCC can point to and say “here is why we have
authority to make these rules.”
This authority principle prevents the FCC from regulating carbon
emissions from power plants or the EPA deciding who gets to own a TV station.
In the case of the net neutrality rules, the FCC is relying
on a broad instruction from Congress to promote broadband
deployment and adoption (called the “Section 706 argument” for the Section
of the Telecommunications Act of 1996 that added this law to the Communications
Act”). In addition, the FCC has also pointed to several specific statutory
responsibilities (like, ‘make
sure telephone service is affordable,’ ‘make sure video services
are competitive,’ ‘make
sure wireless carriers serve the public interest’), arguing that it cannot
do these things effectively without a network neutrality rule. In bringing its case against the FCC,
Verizon is arguing that none of these instructions mean that Congress intended
it to create net neutrality rules.
Does Something Else
Stop The FCC From Having Network Neutrality Rules?
In addition to arguing the FCC didn’t have the authority in
the first place, Verizon has also argued that the net neutrality rules violate
their First Amendment rights. Verizon has also argued that other provisions of
the Communications Act prohibit the FCC from applying the network neutrality
rules. Finally, Verizon argues that the FCC did such a bad job explaining its
reasoning that the rules are “arbitrary and capricious and otherwise not
supported by the record.”
The First Amendment
Verizon argues that it has a First Amendment right to block
whatever it wants. Verizon argues that, like a newspaper, it provides you with
news but has a right to cover whatever it wants and say whatever it wants.
Alternatively, it’s at least like a cable system. Just like Verizon FIOS
decides whether or not to carry Al Jazeera America, and on what terms, Verizon
argues it has the right to decide whether or not to go to AlJazeera.com, and on
John Bergmayer has a more detailed explanation of the
counterargument here. The short version is there is a difference between the
business of delivering someone else’s speech and actually speaking. It does not
violate the First Amendment to say that UPS has to carry everyone’s packages –
including magazines it doesn’t like.
Other Statutes That
Prevent the FCC From Having Network Neutrality Rules
Verizon has pointed to two statutes that say the FCC cannot
regulate certain things ‘as a common carrier,’ meaning as a phone network
(except to the extent they act like a phone network). Again, John has a more
detailed look at this argument in this blog post. Basically, the FCC will
argue that this limitation doesn’t apply here.
Finally, whenever an agency makes a rule, it has an
obligation to explain its reasoning and point to evidence in the record that
justifies the decision. Verizon will argue that even if the FCC has the
authority it claims, it did not do a good enough job justifying the network
This would be the place you would expect all the arguments
people make about whether the rule is a good idea or not to come up. But the
legal standard for proving a rule is “arbitrary and capricious” is supposed to
be very high. It’s not about whether the judges think the rules is a good idea
or not. If there is any evidence to support the FCC’s decision, and if the rule
even vaguely addresses the problem the FCC wants to solve, the court is
supposed to uphold the FCC.