Telecom Lawyers See Major Procedural Hurdles for FCC in Net Neutrality Suit

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By Lydia Beyoud

March 24 — The FCC may face a serious challenge in demonstrating it provided adequate notice of its decision to reclassify wireless Internet services under Title II and change the definition of commercial mobile radio service (CMRS), a telecom practitioner and former FCC general counsel said March 24.

“Even there, though, I think they had enough in the notice [of proposed rulemaking] that they asked whether CMRS would be covered,” said Sam Feder, a partner at Jenner & Block LLP, during a teleconference hosted by the Phoenix Center, a Washington-based think tank.

Feder and other telecommunications practitioners and former agency officials discussed their views on the Federal Communications Commission Open Internet order (GN Docket No. 14-28) the day after a small Internet service provider (ISP), Alamo Broadband, and a major telecommunications trade group, USTelecom Association, filed the first lawsuits in different circuit courts opposing the rules .

The FCC voted Feb. 26 to reclassify broadband Internet services under Title II of the Communications Act of 1934, a move the agency's Republican commissioners and many large and small ISPs have opposed.

Jeff Lanning vice president of federal regulatory affairs at CenturyLink Inc., the third largest telecommunications company in the United States, said an important point to remember in litigating the order based on claims of Adminstrative Procedure Act process violations, as both petitioners claimed in their filings, is that a court may not fully overturn the FCC order.

That is because the result of an APA process argument is typically a remand from the court for further analysis, and not a reversal of a rule, Lanning said.

Reclassification 

Although the FCC went to great pains to explain how market circumstances had changed for wireless ISPs, thus justifying its decision to reclassify such services for the first time, “it really isn't new,” said Angela Giancarlo, a partner at Mayer Brown LLP and former chief of staff to former Republican Commissioner Robert McDowell.

“It's exactly the arguments that they used in 2010 for not extending the rules to wireless,” she said. “I don't think the rationale matches such a significant change.”

The FCC would have to come forward with a compelling rationale for how and why the market that the commission has monitored for the past 25 years has changed so fundamentally as to precipitate an “extraordinary reversal of many fundamental classification determinations,” said Thomas Navin, partner at Wiley Rein and former FCC Wireline Competition Bureau chief.

A starting point in litigation “is to acknowledge this decision represents one of the most breathtaking reversals of law in the past 25 years of telecommunications regulations. If that is your starting point, I'd say the commission has a reasonably high hurdle to get over” to explain its decisions, Navin said.

Decisions on how to classify wireless broadband services in previous commissions were widely viewed as close calls by telecom practitioners, Lanning said.

“They went for the information service route” under Title I of the Act, “for what we think are great policy reasons,” he said.

Forbearance From Provisions 

The FCC decision to forbear from the majority of the Title II provisions doesn't give much comfort to CenturyLink, Lanning said.

The operative sections of Title II that continue to apply, including Sections 201 and 202, provide the FCC with a broad grant of authority, he said.

Though the commission forbore from the majority of the Title II provisions, “the FCC probably could do most of what it wants” under 201 and 202, Lanning said.

To contact the reporter on this story: Lydia Beyoud in Washington at lbeyoud@bna.com

To contact the editor responsible for this story: Heather Rothman at hrothman@bna.com