New Court Decision May Be Bad News for State Net Neutrality Laws

A ruling by a federal circuit court last week is being hailed by Donald Trump’s appointed FCC Chair Ajit Pai as a precedent that means state-level net neutrality laws will be ruled out by the courts, according to a report by Consumer Affairs. Pai’s FCC filed a brief in support of Charter Communications when the company sued the state of Minnesota over regulation of its VOIP—that is, internet telephone—service.

Charter split its VOIP service from its cable TV service in an effort to avoid state regulation, classifying its VOIP operation as an “information service,” which means it would be exempt from state regulations, according to federal law. But Pai took the ruling a step further, issuing a statement last week claiming the Eighth Circuit court ruling means that states cannot impose net neutrality rules, because the internet itself is an “information service.”

“The Eighth Circuit’s decision is important for reaffirming that well-established principle: ‘[A]ny state regulation of an information service conflicts with the federal policy of nonregulation’ and is therefore preempted,” Pai said in the statement. “That is wholly consistent with the approach the FCC has taken under Democratic and Republican Administrations over the last two decades, including in last year’s Restoring Internet Freedom Order.”

The Restoring Internet Freedom Order is the name Pai gave to the FCC’s repeal of the federal net neutrality regulations that were in effect from 2015 until June 11 of this year.

But 22 states, the District of Columbia and several large online content providers and search firms, including Google and Netflix, are currently suing the FCC to reverse the net neutrality repeal order, and a lawyer for one of the groups in the lawsuit told the tech site Ars Technica that the Eighth Circuit decision has no bearing on the net neutrality case.

There was "no FCC decision at issue,” in the Charter VOIP case, said attorney Andrew Schwartzman. “The FCC has repeatedly refused to decide what regulatory classification ... should be applied to VoIP. Thus, it was left to the court to consider the question in a case between the state and Charter."

The Eighth Circuit decision may be read online at this link.

Three states have already passed their own net neutrality bills, and as reported, the California legislature on August 31 passed the strongest state-level net neutrality bill in the country, though 12 days later, Governor Jerry Brown has not yet signed the bill or made a public statement on the net neutrality issue.

“A patchwork quilt of 50 state laws harms investment and innovation in advanced communications services," Pai said in his statement. But as the site TechDirt noted, “there wouldn't be a ‘patchwork quilt of 50 states’ trying to protect net neutrality if Pai hadn't almost gleefully assaulted popular (and modest by international standards) federal rules.”

Photo by Gage Skidmore / Wikimedia Commons