Court of Appeals Nullifies Part of FCC’s Open Internet Order

The U.S. Court of Appeals struck down part of the Federal Communications Commission's (FCC) rules on Net Neutrality today, in a clear victory for Verizon and other service providers who say the agency doesn't have jurisdiction over mobile and broadband.

The D.C. Circuit Court of Appeals ruled part of the FCC's Open Internet Order (which went into effect in 2010) dealing with pay-for-prioritization deals is invalid because the FCC doesn't have authority. The decision could pave the way to companies like Verizon charging companies like Netflix for a faster path to consumers. The ruling did maintain that the FCC still has "general authority" to regulate how broadband providers treat traffic.

Here's part of the 81-page ruling (PDF):

"..even though the Commission has general authority to regulate in this arena, it may not impose requirements that contravene express statutory mandates. Given that the Commission has chosen to classify broadband providers in a manner that exempts them from treatment as common carriers, the Communications Act expressly prohibits the Commission from nonetheless regulating them as such. Because the Commission has failed to establish that the anti-discrimination and anti-blocking rules do not impose per se common carrier obligations, we vacate those portions of the Open Internet Order."

Current FCC Chairman Tom Wheeler said that the commission might appeal the ruling.

"The DC Circuit has correctly held that ‘Section 706 . . . vests [the Commission] with affirmative authority to enact measures encouraging the deployment of broadband infrastructure’ and therefore may ‘promulgate rules governing broadband providers’ treatment of Internet traffic," Wheeler said in a written statement. "I am committed to maintaining our networks as engines for economic growth, test beds for innovative services and products, and channels for all forms of speech protected by the First Amendment. We will consider all available options, including those for appeal, to ensure that these networks on which the Internet depends continue to provide a free and open platform for innovation and expression, and operate in the interest of all Americans."

Consumer advocacy group Free Press expressed its disappointment in the ruling. Free Press CEO Craig Aaron said that the ruling means that "Internet users will be pitted against the biggest phone and cable companies—and in the absence of any oversight, these companies can now block and discriminate against their customers’ communications at will."

Aaron blamed former FCC Chairman Julius Genachowski, who "made a grave mistake when [his Commission] failed to ground its open Internet rules on solid legal footing. Internet users will pay dearly for the previous chairman’s lack of political will."

Consumer advocacy group Public Knowledge said that it might file an appeal to this ruling.

"[T]he Court did uphold broad Commission authority to regulate broadband," Public Knowledge Senior VP Harold Feld said. "To exercise that authority, the FCC must craft open Internet protection that are not full fledged common carrier rules. Alternatively, if the FCC needs broader authority it can classify broadband as a title 2 common carrier service. Both of these are viable options. In fact, Public Knowledge has long held that broadband is a telecommunications service and that the modest protections offered by the Open Internet rules fall well short of full common carrier regulations."

Source: Ars Technica. Thanks to everyone who let us know about this story.

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