DOJ Absence on Muni-Broadband Brief Bad Sign for FCC, Several Attorneys Say

Others who didn't want to be cited by name said the DOJ rarely declines to join FCC briefs. "When I was in the Office of General Counsel, I think the DOJ may have refused to sign two times, once when they did not have enough time to get approval from higher-ups and once when they disagreed with us on the merits,” said a former FCC OGC attorney: “I have always thought the FCC’s arguments here are very weak. DOJ refusing to sign on furthers that narrative.” DOJ and FCC spokespersons had no comment.

A few attorneys were more circumspect, noting the DOJ didn’t explain its decision. Morgan Lewis attorney Andy Lipman agreed the DOJ’s decision not to join the FCC brief was unusual. “This is an area where nine times out of 10, you expect the Justice Department to support the FCC,” he told us. “But I think some people are making a mistake in reading the tea leaves here that Justice is at odds or not onboard with the FCC on a policy issue. I think the issue is probably something more mundane.” Andrew Schwartzman, senior counselor at the Georgetown Institute for Public Representation, said the DOJ from time to time doesn't join an FCC brief for various reasons. “This may or may not be a reflection of disagreement with the FCC’s position,” he said. “It can be as simple as that the FCC was unable to produce a draft in time for internal review. Sometimes, there is an internal institutional issue having to do with other pending cases but having little to do with the merits of the particular case.”

The FCC filed its brief Thursday defending an order that pre-empted laws in North Carolina and Tennessee that “blocked (or effectively blocked)” the ability of cities in those states to extend municipal broadband services into neighboring geographic areas. “This denied service to new customers who wanted it and effectively shielded from competition the private providers who provided inferior service to these communities,” said the FCC brief, which noted the commission had responded to requests from Wilson, North Carolina, and Chattanooga, Tennessee, to pre-empt the state laws as counter to federal policy. “The Commission determined that these two laws served to regulate interstate competition in the broadband market, as opposed to exercising traditional state control over political subdivisions. State and federal policy on interstate competition were thus in direct conflict. Under the Commerce and Supremacy clauses, state policy must give way.”

The DOJ submitted a one-line letter that simply said it took no position on the two cases in the U.S. Court of Appeals for the 6th Circuit (The State of Tennessee v. FCC, No. 15-3291, The State of North Carolina v. FCC, No. 15-3555). Harlow Sumerford, communications director for Tennessee Attorney General Herbert Slatery, emailed us Monday: “While the Department of Justice’s decision not to join the FCC brief is certainly notable, we remain focused on the task at hand. As we have stated previously, our position is that the FCC has unlawfully inserted itself between the State of Tennessee and the State’s own political subdivisions. We will continue to defend that position.”

Commissioner Ajit Pai, who dissented from the FCC order, tweeted Friday that it was “exceptionally rare” for DOJ to not sign an FCC brief. “In February, I explained why FCC’s municipal broadband decision was unlawful,” he said. “DOJ’s silence adds to my case,” he claimed.

Free State Foundation President Randolph May said DOJ’s “curt statement … is very curious.” A former FCC associate general counsel, May emailed Friday: “I can tell you this is a very rare occurrence. And it is especially curious in this case because President [Barack] Obama urged the FCC to do exactly what FCC Chairman Tom Wheeler then did. We don't know for sure, but my best guess is that the DOJ, quite rightly, is concerned about the lawfulness of the FCC's pre-emption action. If so, the concern is justified."

DOJ’s decision not to join the brief is rare, agreed almost all attorneys we talked to Monday, and most thought it was a problem for the FCC, though there were differing opinions on the severity. “In my personal experience of over 30 years in administrative law, that’s significant and somewhat unusual. It probably has happened before in some case, but I cannot remember any case I’ve been in where DOJ did something similar,” said NARUC’s Ramsay. He said the DOJ stance was even more unusual because Obama earlier this year voiced support for FCC pre-emption of state laws restricting municipal broadband efforts (see 1501140048). Absent further information, “the minimum logical implication one can derive from such a statement is that DOJ does not agree with the FCC’s theory of the case. Hard to take it as anything other than a positive sign for those that do not agree with the FCC order,” he said.

A second former OGC attorney said the DOJ joined “the vast majority” of FCC briefs defending its policy orders against petitions for review. “I have a hard time thinking of a case where DOJ didn’t join the FCC brief,” the attorney said. The attorney said there could have been some logistical issue, but added: “My guess is it’s due to some sensitivity or disagreement with the FCC analysis on pre-emption.” But the attorney didn't think the DOJ stance would necessarily swing the case in the states’ favor: "At most it leaves the court scratching its head.”

Another attorney not involved in the case was less sanguine on the fallout for the FCC. The attorney told us it’s “very uncommon” for the DOJ not to join an FCC brief. “It’s possibly mundane; maybe OGC didn’t get the brief to DOJ in time for DOJ to review it,” said the attorney. “But it’s much more likely a very bad sign for the FCC. DOJ -- a natural ally that regularly supports federal pre-emption -- apparently has decided that the FCC went too far here. The FCC may be lucky this case is in the 6th Circuit rather than the D.C. Circuit, which would ‘get’ the significance of DOJ not being willing to sign on.”

Lipman agreed it was “curious” the DOJ didn’t back the FCC brief, especially in light of Obama’s general support for the policy. “You wouldn’t expect any daylight between the administration and the FCC on this,” he said. “So I want to be cautious about any consequences of this, particularly since I’m not hearing of any schism between Justice and the FCC on this issue.” He said it was unlikely there’s a policy dispute between the FCC and DOJ. “I think it’s going to be some technical or administrative reason as opposed to a policy reason,” he said. “I don’t think you can automatically read something untoward into it [for the FCC], but I do think it’s out of the ordinary.”

Schwartzman said any time a federal agency pre-empts a state law there are substantial legal issues, but he suggested it wasn't that uncommon for the DOJ to decline to join a brief filed by the FCC. For example, he said the DOJ didn’t join the FCC’s brief defending its 2013 order capping interstate inmate calling service rates. “Sometimes, it is unrelated to the actual merits of the particular case,.” he said.

“People are correct that there could be a number of reasons DOJ is not signing," said one of the ex-OGC attorneys. "But one likely reason is that they don’t agree on the merits."