As Expected, Verizon Appeals FCC’s Net Neutrality Order

by Mike Wendy on January 21, 2011

Verizon formally appealed the FCC’s Net Neutrality Order today.  The company had been expected to do this, so it comes as no surprise.

Verizon seeks relief because the Order exceeds the Commission’s statutory authority; is arbitrary and capricious and abuse of agency powers; goes against the company’s constitutional rights; and is otherwise against the law.

The surprise is yet to come as to the exact arguments they’ll make before the Court.  So here’s a (very) topline surmise on the reasons why Verizon likely feels aggrieved by the FCC’s Net Neutrality Order, which appears tied to § 706 of the Administrative Procedure Act and the standard of review of agency actions.

  • Because there is no express congressional grant of authority within the Communications Act to regulate information services – no matter what they’re called – and because the agency has not reasonably tethered its “ancillary authority” to any related statutory powers within the Communication Act, the Agency can’t regulate broadband Internet access services (BIAS) / network providers of BIAS.  Or, stated differently, they cannot make up authority beyond what Congress has given it.  Though courts grant agencies huge deference (called “Chevron” deference), such deference here is not due.
  • The Commission cannot take the property of providers without just compensation (among other things, the Order limits what network providers can do with, what they can charge for, and who can have access to, their property), or limit providers’ free speech rights (the Order takes away the right of providers to decide who can speak, or not, on their facilities).
  • And, the record does not support the Order’s conclusion.  It singularly damns an entire segment of the industry (only network providers) based largely on what might happen, not what currently is, and then inappropriately lays blame / amortizes that harm across hundreds of unique markets without proper understanding of each market.

Certainly, more to come…

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