Making Sense of the Challenges to the FCC's Net Neutrality Rollback - Pacific Standard

Making Sense of the Challenges to the FCC's Net Neutrality Rollback

On Wednesday, the Senate made use of an obscure legislative procedure to challenge the FCC's proposed changes to net neutrality regulations. We chatted with a law professor to break down the specifics.
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Senate Majority Leader Charles Schumer speaks at a press conference on May 16th, 2018, in Washington, D.C., as House Minority Leader Nancy Pelosi looks on.

Senate Majority Leader Charles Schumer speaks at a press conference on May 16th, 2018, in Washington, D.C., as House Minority Leader Nancy Pelosi looks on.

For nearly half a year, Internauts across the United States have been dreading a worsening in governance of the Web. In December, the Federal Communications Commission voted to repeal net neutrality rules that had been in place since 2015. The new FCC regulations would stop regulating the Internet as a utility, and no longer prevent companies from charging different rates for faster loading speeds or blocking particular websites.

Five months later, the Obama-era net neutrality rules are still in place, thanks to the deliberate pace of federal bureaucratic procedure. The FCC says it will implement the changes next month—though not without a fight from Senate Democrats, who are using an obscure legislative provision as a last ditch attempt to prevent the regulatory rollback, or, at least, to score some political points before the changes are in place.

On Wednesday, Senate Democrats, joined by three Republicans and two Independents, voted to retain the 2015 net neutrality rules, according to Reuters. The vote is part of a legislative challenge to the new FCC regulations, made possible by the Congressional Review Act, which allows Congress to contest rules made by federal agencies. For Congress to prevent the net neutrality rule rollback, the House of Representatives will now have to pass the same resolution. The Republican-controlled House is unlikely to vote like the Senate on this issue, if they hold a vote at all. Additionally, a number of companies and 21 state attorneys general have brought legal challenges against the rule changes.

To break down the specifics of the rule changes, and the legislative and legal challenges to the rollback, Pacific Standard spoke to Justin Hurwitz, a law professor and director of the Space, Cyber, and Telecom Law Program at the University of Nebraska, whose work was cited by the FCC in both the 2015 and 2017 net neutrality rule changes.

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The FCC voted to repeal net neutrality in December. Why has it taken so long to go into effect?

After any piece of regulation gets voted on and adopted by a federal agency, it needs to go through a regulatory process, and it needs to be finalized and published in the Federal Register. And that process always takes a couple of months to get it to [the Office of Management and Budget] for a review, before it can be published in the Federal Register. And then it doesn't go into effect for another month or so after it's been published in the Federal Register.

The thing that some folks have recognized and raised a little fuss about—though I think it's really a tempest in a teapot—is some of the elements of the 2017 order could have gone immediately into effect, but the order said that they weren't going to go into effect until the rest of the order (that did need to go through this longer process) went into effect. The reclassification, which is a declaratory order—that can be implemented immediately. But the new transparency rule needs to go through the OMB and Federal Register process.

In December, the FCC vote actually made two different changes to net neutrality regulations—a declaratory order and a "rule change." What do those two different changes mean?

The declaratory order is the component that the folks who believe that the FCC should be playing a stronger role are most concerned about. It reclassifies Internet service as an information service and lessens the Commission's ability to regulate and adopt strong, prescriptive rules about what Internet service providers (ISPs) can do on the Internet. Because that's not a rule, but a declaratory order, it can have [immediate] effect. Rule changes need to go through a longer process, and the [new] transparency rule, which requires ISPs to be public about how they treat their customers' information. It's actually more rigorous than the previous open Internet order was. This rule needs to go through the full regulatory publication and review process.

Justin Hurwitz.

Justin Hurwitz.

Two concerns that the FCC really had, as I understand it: The declaratory order portion of the 2017 [changes] undid the previous transparency rule, so if they immediately implemented [the change], there would have been a gap period where there was no transparency rule governing ISPs, and that would be bad. So they said, "We're going to delay the implementation of this stuff until everything can go into effect, so we won't have any gaps."

The FCC says the regulatory changes will go into effect on June 11th, unless Democrats are able to successfully use the Congressional Review Act process to repeal the changes. I know that process began with today's Senate vote, but can you help me better understand what that process is?

The CRA is a law that was adopted by Congress in the 1990s that allows the Senate to initiate a process to undo any rule adopted by a federal agency within 60 days of that rule being adopted. One of the purposes of the CRA was to give a Congress protection for the ability to take action against what are sometimes referred to as "midnight regulations," regulations pushed through by a presidential administration at the very end of its term. If the Senate successfully votes on a CRA resolution, then the House needs to approve it, and the president has an opportunity to veto it. It's a little different from ordinary legislation, because with ordinary legislation, if the president doesn't sign off on it, it doesn't go into effect. Here, even if the president doesn't sign off on it, the resolution still goes into effect—meaning the [new 2017 FCC rule regarding ISPs] is overturned.

The other important aspect of the CRA: If a CRA resolution is successfully adopted, then not only is the agency's rule voided, but the agency is prohibited from adopting a substantially similar rule in the future. That's really important because, until last year, the CRA had almost never been used by Congress, and it's really unclear what substantially similar means. It's not really been litigated. For instance, if the FCC's transparency rule is reversed by the CRA, does this mean that now the FCC cannot implement a transparency rule whatsoever? Does it mean that it can implement transparency rules, but they just can't be as strict as this one was?

Is the CRA vote that took place today just on the new transparency rule or is it on the entirety of the declarative action and the transparency rule?

Assuming [the CRA action] succeeds somehow, this is going to be litigated. It's going to go to court because what a rule is, for the purposes of the CRA, is a really hard question. The reclassification of Internet service and the resultant undoing of the 2015 order—that was a declaratory order, which is not a rule. But, in effect, it's very rule-like. And the transparency stuff was clearly a rule. So, if the CRA is successful, the transparency rule is definitely gone. But we don't know what else happens.

So in the unlikelihood that the CRA move is successful, it wouldn't only have an effect on the specific issue at hand, but it might also be an important precedent case in how the CRA is used the future?

Two or three years down the road? Yep, it certainly could clarify the CRA. Given how much the CRA is being used right now, that could be useful, but it's going to come at a huge cost of uncertainty in the industry and with the FCC, because it won't be clear whether either or both the FCC or [the Federal Trade Commission] do or do not have authority to regulate consumer protection concerns with respect to the Internet and privacy-related regulations.

With the exception of a few Republicans who voted with Democrats, today's vote in the Senate cleaved neatly across party lines—with Democrats voting for net neutrality, and Republicans against it. Should we see this as representative of a broader party split on this kind of regulation and soft anti-trust enforcement, or is this a more specific issue that we shouldn't extrapolate to other industries and other parts of the telecommunications industry?

I'm incredibly cynical about this. That said, I think my cynicism is accurate and well-deserved. I would not extrapolate from anything about net neutrality to any other industry. This is a very blatant political move. Congressional leadership has basically told Democrats not to engage with anyone on any changes to net neutrality. The purpose of this is to energize people about the 2018 mid-term election. Net neutrality has proven to be a great way to energize younger voters, who—frankly—understand very little about the issue.

A number of tech companies, as well as 21 state attorneys general, have filed a lawsuit challenging the repeal of net neutrality regulations. What arguments are they using to challenge the repeal, and do they stand a chance in court?

The interesting thing about the arguments that they are making is that they are basically the same arguments that were made [during challenges to the Obama-era net neutrality rules implemented in] 2015. In the interest of disclosure, I was one of the people making these arguments. I filed many briefs in the previous litigation. But [the current lawsuits] are making the exact same arguments that folks who challenged the 2015 order made. Do I think that they have a chance? Yes, kind of. I think that they are making the right arguments. However, if the D.C. court of appeals, where this is being heard, agreed with those arguments, the FCC would have lost its defense of challenges to the 2015 order, instead of winning it. And I expect that, if the current challenges are somehow successful, the court, through some combination of the D.C. circuit and the Supreme Court, will find a way to invalidate both the 2017 order undoing the 2015 order, and the 2015 order itself.

This interview has been edited for length and clarity.

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