The repeal will permit broadband companies such as AT&T and Verizon to speed up some websites, slow down others or charge them new fees — a move that critics say could reshape the Internet ecosystem to favor large, established incumbents. Defenders of the decision, meanwhile, say it will free up more money for Internet providers to use to upgrade America's networks.
Because of the potentially far-reaching consequences of the vote, consumer groups and some state attorneys general have vowed to sue the FCC to overturn its decision. The first suits could be filed in mid-January, according to some analysts.
“We're suing because the FCC today broke essentially all the rules of administrative procedure,” New York Attorney General Eric Schneiderman told MSNBC last week after the vote. “Agencies aren't just allowed to make any arbitrary decision. In fact, courts have held that if a decision is ‘arbitrary and capricious’ … it has to be rejected.”
Opponents of the FCC are expected to make two broad categories of arguments, analysts say. One thrust is likely to target the FCC's legal reasoning for undoing the net neutrality rules, and the other will concentrate on the decision-making process that led to the vote, which some critics claim had been “corrupted.”
The last net neutrality lawsuit also followed this pattern, but the sides were flipped: It was industry groups who argued that the FCC's net neutrality rules were flawed and that the agency had violated the Administrative Procedures Act. In that lawsuit, a three-judge panel upheld the regulations, giving the FCC the benefit of the doubt in part due to its technical expertise.
But that deference to agency decision-making could cut against supporters of the net neutrality rules this time even though it helped them in the last round, said Matthew Brill, a partner at the firm Latham and Watkins who represents NCTA — The Internet and Television Association, a major cable industry trade group. That's because the FCC gets a “significant amount of discretion” to change its mind on policy matters, he said.
“When the court ruled [last time],” said Brill, “it emphasized it wasn't assessing the wisdom of that policy — it was just upholding the agency's decision-making under the broad leeway it gets.”
Judging by that argument, the courts could find that the GOP-led agency is within its rights to write the rules differently now, according to industry officials.
“What the court has said when you change your mind is, ‘As long as you come in with a rational, reasonable justification that's not arbitrary and capricious, we will uphold you,’ ” said one industry official, speaking on condition of anonymity to speak more freely.
What exactly did the FCC change its mind on? The key issue is how the FCC regulates Internet providers in the context of its oversight powers. Under the 2015 net neutrality rules, Internet providers were branded as telecom companies for the first time — opening the door to new rules on everything from privacy practices to the pricing of Internet access. Last week's repeal overturns that classification, describing providers instead as “information services” — which are more lightly regulated and face fewer FCC obligations.
Opponents of the current FCC may try to argue that the agency didn't do enough this time around to consider whether Internet providers should qualify as telecom companies.
The FCC's order “starts with the definition of an information service, and decides that broadband [qualifies as] an information service and therefore we don't need to ask the question of whether it's a telecom service,” said Harold Feld, a senior vice president at the consumer advocacy group Public Knowledge.
The FCC declined to comment for this story. But Pai has previously argued that in its only case on this question, the Supreme Court endorsed an earlier, 2000s-era finding by the FCC that Internet providers are, in fact, information service providers. As a consequence, it should not pose a legal problem for the FCC to return to that interpretation, according to Pai.
Even if the courts rule for the FCC on its definition of Internet providers, opponents of the agency hope to gain a victory by focusing on the public feedback portion of the decision-making process. FCC Democrats such as Mignon Clyburn and Jessica Rosenworcel have highlighted troubling irregularities in the agency's docket, such as numerous comments that were filed under allegedly stolen or fake identities.
As many as 2 million comments may have been submitted under false names, according to Rosenworcel, who also alleged that some 500,000 comments came from Russian addresses and that 50,000 consumer complaints mysteriously vanished from the docket.
By casting doubt on the integrity of the comments, FCC critics are arguing that the decision-making process had been tampered with in ways that ought to invalidate the agency's policy.
“The FCC will be made to explain its headlong rush past all of the problems with its record in this proceeding,” said Matt Wood, policy director at the consumer advocacy group Free Press, which has also signaled an intent to sue.