Federal Appeals Court Issues Mixed Decision on Net Neutrality

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Yves here. The fight over net neutrality has been underway before this blog even existed. Matt Stoller, who was a regular at Naked Capitalism before he went on to greater things, cut his political activism teeth on the early net neutrality battles, and became a friend of Aaron Swartz.

This Real News Network segment discusses the latest ruling, in the DC Circuit Court. The court sided with the FCC on some measures to end net neutrality, but also backed stage legislation to preserve it.

GREG WILPERT: Welcome to the Real News Network. I’m Greg Wilpert in Baltimore.

The United States Court of Appeals for the District of Columbia circuit ruled on Tuesday that the elimination of what is known as net neutrality is legal. It also ruled that states are allowed to establish their own net neutrality rules, potentially undermining the rules of the federal communications commission, the FCC. Now, what does all of this mean for access to the internet? First of all, for those who haven’t been following the story, net neutrality is a principle that had been implemented during the Obama administration’s FCC.

According to the rule, internet service providers must treat all internet traffic equally, regardless of how much they pay for it. That is ISP such as Comcast, Verizon, and AT&T, were not allowed to slow down or speed up or block internet traffic from specific websites in accordance with different levels of services and prices to the consumer. Net neutrality advocates have always maintained that this principle is essential for free flow of information and ideas. However, shortly after Trump took office, he appointed agent Ajit Pai as new FCC chair who then revoked net neutrality. Since then, the matter has been tied up in courts and state legislatures.

Joining me now to discuss the latest court ruling on net neutrality is Matt Wood. He is Vice President of Policy at the organization Free Press, which has been one of the leading organizations in favor of net neutrality and one of the petitioners in the recent net neutrality court case. Thanks for joining us today, Matt.

MATT WOOD: Thank you. It’s great to be here.

GREG WILPERT: So I already summarized the court’s decision, but let’s dig a little bit deeper. The FCC’s elimination of net neutrality is legal according to the decision, but so are state efforts to reinstate net neutrality. So first as a lawyer in the side in favor of net neutrality, what is your argument that eliminating net neutrality is illegal or what laws or legal principles does its elimination violate?

MATT WOOD: Sure. So saying that it’s legal is definitely correct. We tend to talk about whether the agency has the power to do something or not. Not to necessarily call it legal or illegal, but whether it’s within their authority, within their jurisdiction. And a federal agency like the FCC only has the powers that it’s been given by Congress. So our argument was that it was reading the laws that Congress has written incorrectly. That there are parts of the law that say services like broadband have to be free from discrimination, have to be offered to people on just and reasonable terms. The reason that the FCC won in some parts of this decision this week is that the court didn’t agree with our view and agreed with the FCC’s, but only just barely and only because there’s a doctrine in federal law in the judiciary that says federal agencies like the FCC actually have a lot of deference.

The judges do not necessarily sit in judgment of everything the agency did. They more ask the question, “Was it a reasonable interpretation? Did the agency do a credible job of explaining what it was doing and why?” Rather than making a new determination from the judges on the bench. And so that’s why the FCC won, as in previous rounds of this long running litigation and conversation. The judges said, “Yeah, we don’t have to agree with everything the FCC decided, all we have to do is find that they had the power to make some of these decisions and we defer to their judgment on issues about whether these rules should apply or how federal law treats broadband internet services.”

GREG WILPERT: Hmm. Now, as I said, states are allowed to institute net neutrality on their own, and several such as California have already done so. Does this ruling now mean that the fight for freely flowing internet will continue in state legislatures or will it be taken to the Supreme Court?

MATT WOOD: Well, as a party to the case, we could take it to the Supreme Court. I just have to say we haven’t decided yet. We’re still very much in conversation about that. The ruling came out two days ago. Now it’s 186 pages long, which is a pretty good size book to take a look at. So we have a lot of questions to ask about our strategy going forward that we just haven’t answered yet, either for ourselves or with the other parties who are part of this case with us. So it could continue in court for sure. It will continue at the states as well.

As you said, this decision said while the FCC can take away their federal rules adopted under the previous Presidential administration and the Obama FCC. But then what the court said in siding with us this time, was that the FCC cannot both give up authority over broadband internet access and then also claim to preempt any state attempts to adopt similar rules. Essentially, the FCC can’t give away its power and then try to assert it at the same time and say, “Well, nobody can touch this if we can’t”

And so that’s why states are now clearer to move ahead. You know, the federal government could come in as they did already in California and try to sue to stop that specific state law, but they’ll have to fight it out in court there and show why the California law in some way conflicts with federal policy. And frankly, we don’t think that the federal government has a very good argument. We think California will and should win that lawsuit, but we’re not there yet because of course, lawyers are never quite done going to court and asking these kinds of questions.

GREG WILPERT: Okay. So if the FCC rules aren’t reversed on a federal level, that is in Supreme court, and if the states manage to continue to create their own rules in favor of net neutrality, what would this state level regulation mean in practice? Would it mean that AT&T consumers in California–let’s say–would have net neutrality, but AT&T consumers in other states would have a completely different fee structure and possibly limited access to the internet?

MATT WOOD: It could mean that. You know, that would be up to the companies and up to how they decide to play it. What you might see and what we would hope to see if that’s really the best we can do is having some very good state laws but not great state laws in all 50 states. We would hope that companies would honor the good laws and not discriminate against their customers. You talked about pricing. It’s a little more complicated than that, but only just barely. People can and do pay for different speed tiers. I might want to buy a faster service. Somebody else might want to buy a slower service. What net neutrality says is that the company like Comcast or AT&T can then charge me differently based on what I’m using it for.

So they shouldn’t be able to say, “Well, if you want to watch Time Warner programming on AT&T, that’ll cost you this much and it’ll come in very quickly. But if you want to watch the Real News Network, then we’re going to charge you extra.” Or “Then we’re going to slow down that video because we don’t happen to own it.” So we hope that doesn’t happen. And in fact that’s why we think we need a strong federal law and strong state laws are good, too. But as you said, there is some chance that if we really did have to settle for many different state laws, then yeah, the companies could target their practices and discriminate in some states and not others. We think that would be a very bad result.

GREG WILPERT: Now finally, do you think that this court decision could be taken to the extreme whereby ISPs simply decide to block pages, websites that is, entirely on political grounds in effect to censor the internet? Is that a possibility if there is no national regulation or even state regulation in place?

MATT WOOD: Yeah, I think it’s certainly a possibility. It’s not a hypothetical one. We’ve seen such practices, especially in other countries. And it’s not always far away or overseas. That even in Canada, there was an example about a decade ago of a company blocking access to its union’s website. One of the big telecom companies up there during a dispute suddenly was not allowing people to get through to the union website complaining about the labor practices at that company.

There’s been a lot of talk over these last few weeks and months and years even now about people’s speech, people’s ideas being blocked or at least be prioritized by platforms like Facebook and Google. We have no reason to think or to trust that cable and phone companies wouldn’t engage in those same kinds of practices. And in fact, we think that would be even more dangerous. Because no matter how big a website like Facebook is, no matter how powerful it obviously is, there are many other websites and platforms. In fact, millions of them.

So having that same kind of pressure brought to bear and people saying, “Hey Comcast, why don’t you take down this unpopular opinion? Hey AT&T, why don’t you block people from accessing this website completely?” That’s the thing that we think is all too likely to happen. And to be tempting if ISPs who typically just transmit whatever internet traffic they’re given, both have a financial incentive and perhaps a political incentive to make those kinds of choices and start dictating what we can all see and say when we go online.

GREG WILPERT: Well it definitely seems like the free speech issue of our time at the moment. We’re going to have to leave it there for now. I was speaking to Matt Wood, VP of Policy at the organization Free Press. Thanks again, Matt, for having joined us today.

MATT WOOD: Thank you so much. Great to be here.

GREG WILPERT: And thank you for joining The Real News Network.