Court Fight Seen Likely Regardless of What Approach FCC Takes on Net Neutrality

"There will be blood” and litigation is probably inevitable, said Tim Wu, professor at Columbia Law School and an early advocate of net neutrality rules. “Every time this commission has hoped that there won’t be litigation it has failed,” he said.

But Wu said the legal question has never been difficult. “If you're interested in the strongest and clearest authority of the commission, I think it should use its main authority, which is Title II authority,” he said. With other approaches, the stronger the rules, the more likely they will be reversed again in court, Wu said. For the public, the main thing they will understand is whether there are net neutrality rules or not, he said. “They see this as a very binary kind of thing,” he said. “That’s the case for bright line rules.”

If the FCC “defines clear, bright line rules” under Section 706 or any other authority a court fight will follow, predicted Gus Hurwitz, assistant professor at the Nebraska College of Law. “These rules are going to be litigated for another three to five years at least,” he said. “That’s a place that no one wants to be.” A protracted legal fight also doesn’t help consumers, Hurwitz said. “We need this debate to be over,” he said. The Communications Act already gives the FCC authority to prohibit ISPs from blocking an open Internet, he said.

Sallet, widely viewed as a key behind-the-scenes player at the FCC on net neutrality and other big issues, said comments filed at the agency demonstrate that the public cares deeply about the legal underpinnings of the FCC’s revised rules.

The FCC has several options in light of the U.S. Court of Appeals for the D.C. Circuit’s Jan. 14 decision rejecting the agency’s 2010 net neutrality rules, Sallet said. The FCC could use Section 706 and “create rules that don’t equate to what the court called common carriage, per se,” he said. The FCC could reclassify retail broadband services as Title II services. Or it could “answer the new question that the court asks, what is this other thing, what’s the other service being provided to edge providers and classify that, identify that for the first time,” Sallet said. Or the FCC could use different approaches “in tandem,” he said.

"This is not a monochromatic topic,” said FCC Chairman Tom Wheeler, who opened the session. Wheeler promised that all viewpoints would at least be considered. He said the FCC is holding more than 24 hours of “sustained, continuous” debate on the net neutrality rules through the roundtables. The roundtables got started Sept. 16.

Handicapping what the courts will do “is a fool’s game,” said Mark Cooper, director-research at the Consumer Federation of America. “What you need to do is build a resilient and robust strategy” under revised rules, Copper said. He urged the FCC to make use of various authorities it has to protect the open Internet.

Imposing Title II regulations on broadband providers “would be a bonanza for attorneys, but not necessarily good for Internet innovators or Internet investment,” said Tom Navin of Wiley Rein, former chief of the FCC Wireline Bureau. If the commission were to reclassify broadband Internet access platforms as telecommunications services, I think it would face an extraordinarily high hurdle [of] not only the legal obstacles, but the necessary economic analysis,” Navin said.

Pantelis Michalopoulos, partner at Steptoe & Johnson, said chances are “pretty slim” the FCC will avoid litigation, whatever it does. “The criterion should be how to best fortify the commission’s decision to maximize its chances on appeal,” he said.

Michalopoulos urged the commission to conclude that the transport component of the Internet can be separated from the information service and classified as a common carrier service. But at the same time the FCC should “forbear” from Title II regulation of the transport component as long as such regulation isn’t necessary and it is not necessary while net neutrality rules are in effect, he said. The FCC could then step in if the rules are reversed in court, he said. “The forbearance would automatically expire and common carrier regulation would come back in force,” Michalopoulos said.

On a second panel, Marvin Ammori, fellow at the New America Foundation, said Internet companies, large and small, agree they need “bright line” net neutrality rules from the FCC. That’s why the dozens of Internet startups that filed net neutrality comments strongly supported the use of Title II, he said. If the FCC were to adopt an approach of handling net neutrality on a case by case basis it would only benefit big companies with the most lawyers and the “deepest pockets,” Ammori said.

Ammori questioned whether the FCC could ban or even impose a presumption against paid peering and Internet fast lanes under its Section 706 authority.

Fred Campbell, director of the Center for Boundless Innovation in Technology, said the FCC is “on solid ground” legally if it handles net neutrality problems on a case by case basis. The FCC “can adopt rules under 706 as long as they don’t constitute per se common carriage,” he said. But Campbell questioned whether use of Title II inoculates the FCC from its rules being overturned in court. Bright line rules are by their nature inflexible, he said. Campbell is a former chief of the FCC Wireless Bureau.

The public pays the bills and should not be ignored, said Anne Boyle, member of the Nebraska Public Service Commission. Every time a lawsuit is filed against the FCC it “paralyzes the process” and the “carriers get to do what they want and the public suffers,” Boyle said.