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ACA Joins With ISP Petitioners In Brief Asking Federal Court To Overturn FCC’s Open Internet Order

Agency Acted Unlawfully, Misreading Key Precedents

PITTSBURGH, October 6, 2015 - The American Cable Association joined with Internet service providers (ISPs) petitioners and other trade associations in filing a reply brief calling on a federal court to overturn the Federal Communications Commission's decision to saddle ISPs with unwarranted regulations designed for voice telephone services.  The brief explained that the FCC acted contrary to law and decades of precedent by relying on Title II of the Communications Act as the legal basis for its new regulations.

"The FCC's approach to statutory interpretation is badly flawed. Congress did not give the FCC the power to fashion, according to its own whims, a Title II 'for the 21st Century.'" ACA President and CEO Matthew M. Polka said.

Polka's comments came one day after ACA participated in a joint reply brief filed with the U.S. Court of Appeals for the District of Columbia Circuit, which will hear the ISP parties' case challenging the FCC's decision to reclassify broadband Internet access as a highly regulated telecommunications service and alter a legal status quo in which ISPs had been deemed lightly regulated information service providers.

On the reply brief with ACA were trade associations representing hundreds of wireless and wireline ISPs, including the National Cable & Telecommunications Association, USTelecom, CTIA - The Wireless Association, and WISPA (Wireless Internet Service Providers Association), as well individual ISPs, including AT&T and CenturyLink. 

The brief explained that under the relevant communications statutes, Internet service is not like voice telephony, which involves no data storage or processing but only pure transmission, and accordingly should not be regulated in the same manner.  Further, in reclassifying broadband Internet access as a telecommunications service, the FCC overturned years of consistent decisions classifying Internet access as an information service, misread both regulatory history and controlling Supreme Court and D.C. Circuit precedent, and failed to show that it had given proper notice of its planned changes or complied with the Regulatory Flexibility Act's command that it take into account the impact of its actions on small entities.

The brief stressed that the FCC, which previously and properly classified broadband Internet access as an "information service" and defended that action all the way to the Supreme Court, cannot now apply unchanged law regarding what is an "information service" to the unchanged facts as to how broadband Internet access service is provisioned, and arrive at the opposite conclusion it is now provisioned as a "telecommunications service."  The FCC admitted in the Open Internet Order that it would have reclassified regardless of the facts, evidencing a results-driven analysis.  ACA's brief argued that this shows the arbitrariness of the FCC's decision.

"That concession dooms the Order by confirming that its factual developments rationale is an irrelevant sideshow.  It takes chutzpah to claim that the correct classification of broadband hinges on the 'factual particulars of how Internet technology works and how it is provided,' and to demand deference on that basis - yet assert that, regardless of the facts, the agency can and will do as it pleases," the brief states.

Even aside from the unlawful reclassifications regarding both fixed and mobile broadband, the brief said the entire Order must be vacated because all the Open Internet rules adopted were premised on Title II authority.  The FCC conceded the Order would have to be vacated for all rules with the exception of the Internet Conduct Standard, but the brief showed that it too would fall if reclassification falls.

While the FCC argued that Title II treatment was appropriate because ISPs today are acting as common carriers and holding themselves out indifferently to serve the public with standardized offerings that focus above all on transmission speed, rather than the content of the service delivered, the facts demonstrate otherwise.

Broadband Internet access providers are not voluntarily making the conscious decision to act as common carriers, as the test for common carrier status under the Act requires, and therefore they cannot lawfully be classified as such.  Before the FCC's Order, even providers that offered broadband indifferently were not making a conscious decision to hold themselves out as common carriers, because they were immune from Title II duties as providers of information service and some explicitly reserved the right not to serve potential customers, a key part of the common carrier test.  The FCC neither argued that it could compel unwilling providers to act as common carriers on the record before it, or that it found any provider to have market power, a key requirement before common carrier status can be compelled under the case law.

The FCC offered an inadequate response to Joint Petitioners' arguments that the FCC violated the Regulatory Flexibility Act by failing to address the impact of Title II on small providers.  The FCC's Brief argued that any burdens on small providers emanate from Title II itself, rather than the FCC, so that it did not need to address the impact of reclassification in its Final Regulatory Flexibility Analysis.  Because the FCC claimed for itself the discretion to decide whether to impose Title II "for the 21st Century," Joint Petitioners said the FCC was obligated to consider the costs of that decision on small business.

"At the end of the day, we believe the FCC's arguments are not supportable by either the facts or the law.  The arguments to support imposition of Title II run counter to the Communications Act, and that's bad for all players in the Internet eco-system," Polka said.

About the American Cable Association: Based in Pittsburgh, the American Cable Association is a trade organization representing nearly 850 smaller and medium-sized, independent cable companies who provide broadband services for nearly 7 million cable subscribers primarily located in rural and smaller suburban markets across America.  Through active participation in the regulatory and legislative process in Washington, D.C., ACA's members work together to advance the interests of their customers and ensure the future competitiveness and viability of their business.  For more information, visit http://www.americancable.org/

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