Episode #404, in which the DoJ (on behalf of the FCC) sues CA for imposing net neutrality

Great Debates
1

here we go again

*… the California rules would go into force as scheduled on January 1. Like the former federal law, the new state law applies to home Internet providers and mobile carriers and prohibits blocking, throttling, and paid prioritization.

The DOJ … claims that implementation of the law would cause “irreparable harm” to the United States. It isn’t realistic for ISPs to comply with different net neutrality standards in different states … “Because its regulatory approach directly conflicts with the FCC’s, SB-822 inflicts irreparable harm on both the United States as well as the public interest more generally,” the DOJ told the court … “California will suffer no cognizable harm from being unable to disrupt the status quo by enforcing an invalid law” …*

It sounds to me like the FCC is in the pockets of the major Telecoms. If they are unable to adapt their operations to the requirements of a given state, perhaps they should not be operating there, which could open the way for actual competition.

The DOJ’s lawsuit against California characterizes the FCC’s deregulation of broadband as “an affirmative ‘deregulatory policy’ and ‘deregulatory approach’ to Internet regulation.” The FCC repeal of net neutrality rules thus “does not constitute an absence of regulation for States to fill,” the DOJ wrote.

No regulation is allowed at the state level, they say. This seems a little bit troubling and sounds like a lunge toward eventually trying to eliminate California’s strict auto emission standards (by setting a strong precedent that federal law should always supersede state law).

Ajit Pai, of course, thinks the suit is a good thing

The Internet is inherently an interstate information service. As such, only the federal government can set policy in this area. … Not only is California’s Internet regulation law illegal, it also hurts consumers. The law prohibits many free-data plans, which allow consumers to stream video, music, and the like exempt from any data limits.

Which is not quite correct. The California law allows ISPs to implement uncapped data for categories of service: if they “zero-rate” streaming HBO, they must also zero-rate Netflix, Hulu, et al.
Will this battle ever end? Will there be a winner?

2

Disclaimer: I started out pretty skeptical on net neutrality, and folks here convinced me it is a good thing. So what I am about to say should be read quite narrowly:

At first blush, it looks to me like California has exceeded its authority. As a matter of federalism, seems like the FCC is holding all the cards.

The difference with the auto standards is that the Clean Air Act actually gives California standing to promote its own emission standards, and wisely so.

I think this ends when Congress gets the balls to legislate on the matter.

3

Since the Internet is unambiguously interstate commerce, the federal government certainly has the power to regulate it. But that doesn’t remove the ability of the individual states to also regulate the portions of it which lie within their borders.

4

And remember, the Republicans are the same people who will scream until they are blue in the face about the rights of the states and the dangers of powerful federal government.

What a goddamned joke.

5

I think I understand the difference between an ‘affirmative deregulatory policy’ and the mere absence of regulation (the former says: not only are we not regulating this, but nobody else can either), but could one of the law nerds here give us a clue on what the standards are for a policy being the former rather than the latter? How can we tell that the FCC’s deregulation is one rather than the other?

6

Did your analysis of the issues that led to your second sentence include a review of dormant commerce clause jurisprudence?

7

I yield to someone more in this field than I am, but my general understanding is: in an early nineteenth century SCOTUS opinion, the observation was made that the regulation of interstate commerce is either exercised by the Congress, or “lies dormant,” and can’t rest with the states or the people, giving rise to the term “dormant commerce clause,” and a doctrine related to this concept developed.

The judicial test is whether the law, on its face, treats interstate and intrastate commerce differently. If it does, then the strong presumption is that the state law is violative of the dormant commerce doctrine and requires a strong showing to survive, with a state having to show that no other way to advance a legitimate local purpose that is not related to simply gaining some economic advantage.

If it does not treat interstate and intrastate commerce differently, but has some incidental effect on out-of-state commerce, then the judicial test is: does the interstate burden imposed by the law outweigh the local benefits gained?

Again, this is my general recollection, not an in-depth and sourced analysis.

8

Anyone who has crossed into California knows that the state does regulate interstate commerce at the major points of entry, where they confiscate certain types of fruit.

Net neutrality is enforced at the point of access, which is within the state itself. It only affects how ISPs behave with respect to the end user. If the corporate HQ is in another state, does that constitute interstate commerce?

9

Bricker offers a very good short summary. Let me just say that the expanded answer is quite difficult to write without spending a good four or five hours on it. The section on Commerce Clause jurisprudence in my old Con Law hornbook is roughly 100 pages long, and things haven’t gotten any better since the mid-80s. Let me just suggest that anyone who is looking to apply a simple approach is going to find themselves quickly mired down in the actual minutiae of the decisions.

As the GPO put it in their latest analysis of the Constitution:

The quote in the first paragraph is from J. Frankfurter in Union Brokerage Co. v. Jensen, 322 U.S. 202, 211 (1944), which shows this problem is far from recent.

If you wish to troll through what the GPO thought important in putting that annotated Constitution together, read pages 275 to 290 of the document (click on Article I).

The Constitution of the United States of America: Analysis and Interpretation

10

And if the Federal government had a big problem with that, my instinct would be to say that California would be in trouble.

I note that about 20 years ago, I received something like $300 from the California DMV because they charged a big registration fee to vehicles bought outside the state. This was done to discourage people buying cars in other states, that didn’t have all the California smog control equipment… and I’ll bet that the auto dealer lobby had its hand in it, too. Anyway, if I remember this correctly, someone sued saying that the fee was a restriction of interstate commerce. California defended itself saying that it was an intrastate matter, since it had to do with registration of cars only in California. California lost, and they had to refund the fees to drivers like me.

Why do I bring that up? Because I don’t think that saying “it’s only on activity within the state itself” is a very strong trump card.

But I think in communications generally, that the Federal government has generally decided it is too cumbersome to figure out what is interstate, intrastate, sortastate and basically declared the whole mess to be presumed interstate. If California wanted to set up GoldenStateNet that was just within its borders, then I think you’d be onto something.

11

Why and how, exactly, is it a “joke” to follow the Constitution?

The Constitution very clearly and explicitly carves out an exception to state power by the Commerce Clause, and reserves that particular use of power to the national government.

12

Article I §8:
The Congress shall have Power to … regulate Commerce with foreign Nations, and among the several States …

The Congress has not done that. The FCC is neither Congress nor under the purview of Congress.

13

Congress is fully capable of delegating it’s powers to agencies like the FCC. There’s nothing wrong with that, until of course the FCC makes a bad decision.

But be careful what you are arguing here. The First Amendment says that Congress shall make no law… So if, say, the FBI started stripping people of free speech rights, that would be okay, because it isn’t Congress doing it?

14

“Purview,” means (among other things) “the limit, purpose, or scope of a statute.”

Congress created the FCC by passing laws (see 47 USC §§ 151-154). These laws delegated Congress’ authority to the Executive Brach, but Congress could eliminate the FCC tomorrow if they wished.

15

Thanks to both you and Bricker for the time you both took on a complicated issue. The GPO Annotated Constitution link is especially interesting for later reading.

16

Please re-read my post. It can be Constitutional and gross hypocrisy at the same time.

17

And updated that with the Telecommunications Act of 1996. There are a lot of words in that pdf, but I think I see several that pertain to equity of service for everyone. This appears to be the most recent pertinent action by Congress on the matter. I have not examined it closely (as I said, it is mind-numbingly verbose, like most book law). There may be something in there that favors the FCC over state governments on this matter; I kind of doubt that.

18

“Here’s a bunch of words; I haven’t really read them… but I’m sure they say lots of things, but probably not the things I don’t want them to say. But I can’t be sure.”

19

I don’t see how Net Neutrality says anything about the actual interstate traffic on the internet. It’s only a restriction what kinds of services are allowed to be sold in California. Only those services which don’t discriminate against certain types of traffic are allowed to be sold. In this, it sounds very much like the “milk solids” example in the Wikipedia article for the Dormant Commerce Clause. It makes no distinction between in-state and out-of-state traffic.

Even if California loses the case, I wonder if it can be turned into a kind of labeling law. Sure, you can sell discriminatory services. You just can’t call it “the Internet”. Like creme != cream.

20

Dormant commerce clause. Did you read the caselaw surrounding that? Or was it also dauntingly full of words?