The Zombie Anti-Net Neutrality Arguments The D.C. Circuit Already Rejected.

I do not expect folks to be models of consistency, or to give up on arguments and talking points they have memorized. I also readily agree that a lot of times the same set of facts or a particular statute or set of cases can lend itself to multiple interpretations. but at some point — unless you are either a religious fanatic or deliberately disingenuous — you have a responsibility to admit that the courts disagree with you (at least when talking about law stuff).

 

For example, as I wrote after the oral argument in the Net Neutrality case (aka Verizon v. FCC) I think Judge Tatel and his fellow jurist are completely and utterly wrong on their interpretation of the supposed “common carrier prohibition” that prevents the FCC from banning paid prioritization entirely (as long as it is a Title I information service). I wish the FCC had appealed this to the Surpreme Court. But they didn’t. I wish the recent 10th Circuit case affirming the FCC on Intercarrier Compensation Reform had addressed this question and created a circuit split to take up to the Supreme Court. But they didn’t. So I’m stuck saying “I think this is stupid and totally contrary to the statute and Judge Tatel just made it up, but it’s the law until the Supreme Court says otherwise.”

 

I bring this up because, as John Oliver recently told everyone, the FCC has (to use Chairman Wheeler’s words) decided to “accept” the “invitation” of the D.C. Circuit to write new network neutrality rules based on the Court’s opinion in Verizon v. FCC.  That means we will play this case as the ground rules. So any arguments the D.C. Circuit already resolved are now decided as a matter of law. But whereas I — dumb lawyer that I am — accept that I am stuck with whatever ignorant, idiotic or just plain wrong thing the two-judge majority voted for, a lot of other people don’t. They go on spouting the same arguments that the D.C. Circuit already rejected AS IF NOTHING HAD HAPPENED while simultaneously arguing that since the D.C. Circuit struck down the network neutrality rules (which is not, in fact, what the court did), the FCC has no authority to make network neutrality rules (which is the complete opposite of what the court actually said.

I go through my list of “Zombie Anti-Net Neutrality Arguments The D.C. Circuit Already Killed Deaded Than A Dead Man On Dead Day In Deadville” below . . .

 

 

For this blog post, I’m not including zombie arguments on live questions unresolved by the court like “is Title II an investment killer that will destroy broadband?” I’m just going to list the things the Court explicitly rejected so we are all stuck with unless the Supreme Court gets in the game.

 

Zombie #1: The FCC Never Regulated the Internet As A Common Carrier, Title II Telecommunications Service, Congress Never Wanted The FCC To Regulate The Internet As A Telecommunications Common Carrier, In Fact, I Absolutely Forbid The FCC To Regulate The Internet Under Title II By Passing Section 230, So There!

 

I think I find this one most annoying because not only did I thoroughly rebut this back in the first go round at the FCC in 2010, the D.C. Circuit rejected all this fairly explicitly in the Verizon v. FCC case. But this doesn’t stop people from repeating it, even in Congressional testimony. I keep hearing again and again how “the FCC never regulated the Internet under Title II” blah blah blah “Steven’s Report” blah blah blah “Title II would be outrageous never before done thing that the FCC doesn’t have authority to do anyway so there!” But at least in 2010 we were arguing about a live question with possibly different interpretations — including how to read the 1998 FCC Report (aka the “Stevens Report”) (and yes, it is named for former Senator Ted “series of tubes” Stevens, long story I won’t get into now). But one of the things the D.C. Circuit did was go through all this history — including the 1998 Stevens Report — and explicitly reject this argument. The D.C. Circuit spent pages going through the history (see pages 7-12, 23-24).

The Court even said explicitly “when Congress passed section 706(a) in 1996, it did so against the backdrop of the Commission’s long history of subjecting to common carrier regulation the entities that controlled the last-mile facilities over which end users accessed the Internet.” “Indeed, one might have thought, as the Commission originally concluded, see Advanced Services Order, 13 F.C.C.R. at 24029–30 ¶ 35, that Congress clearly contemplated that the Commission would continue regulating Internet providers in the manner it had previously.” That is a direct quote and a legal conclusion that directly refutes the argument that Congress did not intend the FCC to regulate broadband access as Title II telecom. Just the opposite. According to the D.C. Circuit, Congress expected FCC to continue to regulate the transmission part of the Internet and maintain the structural separation between Internet services and applications and the entities that actually move bits from place to place. But then the FCC changed it’s mind in the Cable Modem Declaratory Ruling in 2002, the Ninth Circuit said the FCC was wrong and the FCC needed to regulate cable modem as a telecom service, but then the Supreme Court in Brand X said the agency has flexibility to change its mind.

In other words, the D.C. Circuit read the history my way, not the other way, so that’s what the FCC has to deal with on remand and the shape of reality on the inevitable appeal. Or, as we lawyers like to say, “neener neener suck it losers.”

 

Zombie #2: The FCC Has No Right To Regulate Net Neutrality Because Congress Thought About Passing Some Laws To Give the FCC That Authority But They Didn’t Pass So You Have No Authority!

 

Verizon made this very argument and the D.C. Circuit explicitly rejected it on pages 25-26. Go read ’em. then stop making this argument. The D.C. Circuit is not gonna like it any better the next time around.

 

Zombie #3: Section 706 Is Not A Real Grant of Authority and the FCC and the FCC Has No Right To Regulate Using It.

 

As pretty much the whole case is about rejecting this argument, I’m really not gonna quote stuff. Look specifically at 21-31. While you can argue the FCC shouldn’t read the statute this way and that the D.C. Circuit was wrong to agree with the FCC, too bad. Unless this goes up to the Supremes, you’re stuck with it the way I’m stuck with the Brand X decision saying the FCC has discretion to decide whether to classify broadband as Title II or not.

 

Zombie #4: Net Neutrality Will Reduce Investment In Infrastructure, the Exact Opposite Of Section 706. There Is No ‘Termination Monopol,’ No Market Power, No Cost/Benefit Analysis, No Proof That ISPs Would Discriminate Or Do Anything Bad, And Discriminating Could Possibly be better and more efficient anyway, and therefore ABSOLUTELY NO WAY A COURT WILL AFFIRM THE FCC’s Rules!

 

Except, of course, that the D.C. Circuit rejected all these arguments and did affirm the FCC’s rules (at least on transparency). As I noted in my original blog post after the court ruling, the D.C. Circuit did not find anything wrong with the FCC’s conclusion that (a) ISPs might do bad stuff without a net neutrality rule, (b) that net neutrality would continue the “virtuous cycle” of investment rather than diminish investment, (c) that there is a termination monopoly that exists without a showing of market power, (d) the FCC doesn’t need a cost benefit analysis other than deciding in its judgment, based on the existing record, that the trade offs and potential risks make it worth it to have a rule; and (e) the record provided adequate support for all these conclusions, and the court must defer to the agency’s expert judgment whether or not the judges personally agree with it. Read pages 31-44.

 

For the anti-Network Neutrality folks to win on any of these arguments, they will need to show that something radical changed in the market since 2010. And no, LTE doesn’t do it because the question of competition is irrelevant. that’s what “termination monopoly” means. To use my favorite example: we do not regulate taxi cabs as common carriers with fixed rates because there is no competition. We regulate taxi cab rates because once I get in the cab and say ‘take me to the airport,’ the doors lock, and my suitcase is in the trunk, my leverage in negotiating a new rate drops precipitously.

 

Similarly, whether or not I can in theory switch providers, it doesn’t make a difference. I’m stuck with the company serving me right now. The FCC found that broadband providers could mess with traffic and had incentive to do so (a conclusion supported by the fact that broadband providers had already messed with user traffic, which negates the argument that they couldn’t do it and negates the argument they would never do it. See my post on the Problem of the Black Swan). The Court found that the FCC’s conclusion was reasonable based on the evidence. So that’s how it is in law land even if you don’t think law land matches the reality (and believe me, I feel your pain on this from my own less than fun experiences with the DC Circuit).

 

CONCLUSION

Feel free to disagree with what the D.C. Circuit said. Lord knows I usually do. And feel free to keep trying to persuade the FCC that it is bad policy to do Network Neutrality because you think all the above things are really true, and the D.C. Circuit got it wrong. But could you please try to give a passing nod to reality and at least acknowledge that the D.C. Circuit decided once already you were wrong and the FCC was right? Would it kill you?

 

But even if it does kill you, I expect you will still come back as a zombie. Welcome to #netneutralitywalkingdead

 

Stay tuned . . . .

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