Net Neutrality

Broadband Providers Attack California Net Neutrality Law

A batch of trade groups that represent many of the nation's Internet service providers have banded together on a joint lawsuit that aims to squash California's new (and tough) net neutrality law.

The lawsuit was filed today with the US District Court for the Eastern District of California by a group that includes United States Telecom Association (USTelecom) , CTIA , NCTA – The Internet & Television Association and the American Cable Association (ACA) , and comes just days after the US Department of Justice filed a similar suit against the California bill (SB-822), which was signed into law on Sunday, Sept. 30. (See DoJ Slaps California With Net Neutrality Suit .)

NCTA represents several large cable operators, including Comcast Corp. (Nasdaq: CMCSA, CMCSK), Charter Communications Inc. and Cox Communications Inc. , while the ACA represents hundreds of smaller, independent cable operators. AT&T Inc. (NYSE: T), Frontier Communications Corp. (NYSE: FTR), and CenturyLink Inc. (NYSE: CTL) are among the large card-carrying members of USTelecom. Major ISPs and mobile companies tied into CTIA include AT&T, Sprint Corp. (NYSE: S), T-Mobile US Inc. and Verizon Communications Inc. (NYSE: VZ).

The trade group-led suit claims that the case "presents a classic example of unconstitutional state regulation."

They likewise claim that the California law aims to "countermand and undermine federal law," arguing that individual states are prohibited from taking action with respect to interstate services such as Broadband Internet Access Services, or BIAS. Therefore, they claimed, California's law is preempted under the Supremacy Clause of the US Constitution, which holds that federal laws generally take precedence over state laws.

"As the FCC has repeatedly recognized, due to the inherently interstate nature of Internet service, it is impossible or impracticable for an Internet service provider ("ISP") offering BIAS to distinguish traffic that moves only within California from traffic that crosses state borders," the suit claims.

Boiled down, the trade association-led lawsuit is seeking for the court to declare that SB-822 is "preempted and unconstitutional" and that California should be permanently enjoined from enforcing it or putting it into effect.

In the complaint, the trade groups also mention that the FCC's order to rollback the rules also determined that BIAS is an inherently interstate "information service" under the Communications Act and reversed an earlier FCC ruling that BIAS should be regulated as a common carrier "telecommunications service." (See FCC Nixes Net Neutrality Rules on June 11.)

The suit also claims that SB-822, by attempting to regulate conduct occurring outside of California's borders, violates the US Commerce Clause, which puts some restraints on the regulatory authority of individual states.

"In regulating Internet interconnection, SB-822 is not limited to ISPs’ dealings with California customers; it also effectively regulates ISPs’ contracts with edge providers in all fifty states, and the exchange of traffic occurring wholly outside of California," the suit read.

California's law takes a hard line on network neutrality with some "bright line rules" that extended beyond those that were included in the FCC rules before they were walked back, particularly concerning a ban on paid interconnection agreements and zero-rating policies.

— Jeff Baumgartner, Senior Editor, Light Reading

brooks7 10/4/2018 | 12:03:58 PM
Re: Didn't the FCC go the other way?  

1 - It is not true that there is no regulation.

2 - I still ask (again) why people are so focussed on an issue that has yet to happen and not universal broadband availability.  When is the last time anybody talked about CAF-II or anything that could help?


Jeff Baumgartner 10/4/2018 | 10:21:18 AM
Re: Didn't the FCC go the other way? Yes, the big battle there centered on cutting down heavier-handed Title II classification on broadband, but agree that the rollback did leave a big void with respect to rules of the road that net neutrality advocates want.  Having a bunch of state-backed rules that could all be different seems like a complex mess that no one wants to navigate, but this chapter could eventually lead to Congress having to step in to establish a national ruling, and that appears to be what AT&T and some other providers prefer vs. the game of ping-pong that's been happening at the FCC in recent years under different administrations. JB 
macemoneta 10/3/2018 | 10:15:49 PM
Didn't the FCC go the other way? When the FCC declined to regulate net neutrality, it seems to me they eliminated any issue that might fall under the supremacy clause. Since there is no federal regulation, the states are free to implement their own. There's nothing to be in conflict with. The FCC didn't decree that net neutrality must be not enforced.
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