Getty Images | naruecha jenthaisong
The broadband industry's attempt to kill California's net neutrality law appears to have little chance of succeeding in the US district court hearing the case.
On February 23, Judge John Mendez of the U.S. District Court for the Eastern District of California denied the industry's motion for an injunction, as we reported at the time. We didn't have many details on Mendez's reasoning last month, but we've since received an as-yet-unpublished transcript of the hearing in which he issued his oral decision against the injunction. (He did not issue a written decision, citing time constraints caused by a lack of judges in his district.)
Mendez's restraining order denial means California can enforce its net neutrality law while the case goes on, leaving open the possibility that Mendez will ultimately side with the broadband industry. But Mendez explained during the hearing why he thinks the industry is unlikely to succeed in the process.
"I do not think that the plaintiffs have demonstrated a likelihood of success in the matter at this stage," said Mendez.
California law prohibits Internet service providers from blocking or throttling legal traffic. It also prohibits requiring websites or online services to charge or prioritize their traffic to consumers, prohibits paid exemptions from the data cap (called "zero rating"), and says ISPs may not attempt to protect themselves Net neutrality by slowing down traffic at network connection points.
AT&T stops loading the zero evaluation
Mendez's decision was already taking effect when AT&T announced on Wednesday that it would end its "sponsored data" program, in which it bills online services for exceptions to the data cap.
"We regret the inconvenience to customers caused by California's new net neutrality law," said AT&T. "Because the Internet does not recognize state borders, the new law not only ends our ability to offer such free data services to California customers, but also also affects our customers in states outside of California. " AT&T also complained that a "patchwork of government regulations" was "impracticable," failing to mention that AT & T's longstanding battle against US-wide net neutrality rules helped states create their own laws would be enacted.
Ernesto Falcon, Senior Legal Advisor for the Electronic Frontier Foundation, wrote on Twitter: "The AT&T version of zero rating with low data caps was a way to guide their users to content they owned. This is why low-income lawyers wanted in." California that they are gone. " Mobile-only users tended to have low income and not get the full internet. "
The judge did not buy the ISPs' intergovernmental argument
Most of the trial consists of the judge asking questions on either side, and he has had far more skeptical questions for broadband lawyers than for California. His skepticism carried over from the argument phase of the hearing to the part where he announced and explained his decision.
The industry, which is represented by lobbying groups for the major cable, DSL, fiber optic and mobile internet providers, has claimed that the Communications Act gave the FCC exclusive power to regulate interstate communications and that states are only able to to regulate purely domestic communication. "Said Mendez." However, the court finds that the provisions of the law on which plaintiffs rely do not support the arguments put forward. "
For example, Section 152 of the Communications Act "grants the FCC the authority to regulate interstate communications while excluding regulation of interstate communications, but that granting of authority to the FCC does not indicate the power of states," Mendez said. The fact that US communications law "has expressly excluded certain types of interstate communications, such as information services, from the jurisdiction of the FCC shows this court that this is not the kind of ubiquitous regulatory system that leaves no room for state law." , he said.
Under previous chairman Ajit Pai, the FCC upgraded broadband as an information service rather than a telecommunications service and relinquished Title II authority to regulate ISPs as joint network operators. The Pai FCC also claimed that the state's net neutrality laws must be anticipated as they would conflict with a federal policy of non-regulation.
In the case of California, the ISPs argue that "state regulations governing shared information services would create an obstacle to Congress' decision to immunize those services from such regulation," Mendez said. However, Congress has not clearly indicated its intention to exclude both state and federal regulation of information services, he said. Mendez then cited a section of the 1996 update of the Communications Act by Congress which said, "This Act, and the changes made by this Act, shall not be construed as altering, affecting, or affecting any federal, state, or local law unless expressly provided for in this Act. " or change. "
Precedent cited by ISPs is not relevant
Mendez also responded to the argument of the ISPs "that the Supreme Court has long ruled in analogous contexts that if Congress has banned federal regulators from imposing certain obligations, states may not impose such regulation without opposing supremacy -Clauses violating. "
The ISP's argument is based primarily on a 1986 decision in a case involving the regulation of wholesale natural gas in interstate trade by the federal government, Mendez said. But this case, in which federal law "occupied the field and excluded state regulation … was a straightforward application of field prevention that has no application here," Mendez said.
The Pai FCC ruled that there was "a lack of authority".
Mendez also criticized ISPs' argument that California law contradicts "the FCC's policy of deregulating broadband Internet access," outlined in Pai's repeal of net neutrality. As Mendez said, the Pai FCC order "interpreted broadband Internet as an information service that falls under Title I of the Communications Act rather than a telecommunications service that falls under Title II, putting it outside of the regulatory scope of the FCC."
The result is that the order (removal of the FCC's net neutrality) is not a case of affirmative deregulation, but rather a decision by the FCC that it had no authority at all to issue regulations … (A) Gency regulations can be the state Affect law only if the agency has delegated authority over the subject. An agency's failure to regulate a practice for which it has no regulatory powers merely shows that it is operating within the limits of its powers and is not exercising delegated power to decide whether the matter should also be free from government regulation.
The FCC has authority to decide whether broadband internet access is an information service, but Mendez said "the deregulation purposes behind this decision are not preventive".
This is similar to what a federal appeals court ruled in 2019 when it upheld Pai's repeal of federal net neutrality rules while blocking a nationwide exemption from state regulations. "(I) In every area in which the Commission lacks the power to regulate, it also lacks the power to prevent state law," said this judgment. Despite the blocking of Pai's attempt at a state-wide preliminary ruling, the 2019 ruling stipulated that state laws could be challenged on a case-by-case basis, allowing litigation against California to continue.
After Biden replaced Trump as president, the US Department of Justice dropped its own lawsuit against California, leaving the ISPs fighting without federal support.
A zero rating ban is not an interest rate regulation
The log also shows that Mendez disagreed with the broadband industry because of California's ban on ISPs 'zero rating' online services in practice, in which AT&T and other network operators count down certain services Exclude data caps. The ISPs argued that the "zero rating provisions don't properly regulate the rates charged," Mendez said. He rejected this argument, stating:
The zero rating provision provides that, as with paid prioritization, mobile broadband providers cannot manipulate the Internet access experience of their subscribers in order to favor paid or connected content over other content on the Internet.
Defendants point out, however, that these provisions do not regulate how much providers can bill their customers because providers can bill the user as much or as little as they want for the service and thus no conflict with the user (Communication) law exists.
Preventing harm to internet users
After thoroughly denying the ISPs' arguments, Mendez said that rejecting the injunction would not do any irreversible harm to the industry. "When the court found that there was no likelihood of success in the validity of the arguments put forward, it also found that there was no irreparable harm (to ISPs)," said Mendez.
California and its supporters filed briefs "detailing the importance of regulations for fair access to the Internet," Mendez said. He continued:
These are not hypothetical concerns. For example, the defendant filed a statement from Santa Clara County Fire Department chief Anthony Bowden describing how Verizon allegedly throttled the fire department's connection during their response to the Mendocino Complex Fire.
The defendants also filed comments from the New York Attorney General, who found that large ISPs had made a conscious business decision to keep their network connections overloaded with traffic and used that congestion as a lever to extract payments from others.
It seems … that issuing an injunction would affect the state of California more than ISP companies and negatively affect the public welfare. It is clearly not as the court finds that it is in the public interest to issue the injunction and the balance of shares, the court said, in California's favor.
While ISPs appeal, the judge tells Congress to act
The ISP lobby groups are appealing to Mendez & # 39; rejection of the injunction in the U.S. Court of Appeals for the ninth circuit. The lobby groups would also likely appeal if Mendez ruled against them after the case was fully negotiated.
Mendez, who was nominated by President Bush in 2008, said, "There's an elephant in the room. There is clearly a political undertone in this case." Mendez said his ruling against ISPs was "a legal decision and should not be viewed through any political lens … it is evident to all of us that this case raises issues that, quite frankly, could be better resolved by Congress than the federal courts. "