United States Telecom Assoc. v. FCC [Order In Slip Opinion Format]

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

FILED: MAY 1, 2017

No. 15-1063

UNITED STATES TELECOM ASSOCIATION,

PETITIONER

v.

FEDERAL COMMUNICATIONS COMMISSION AND UNITED

STATES OF AMERICA,

RESPONDENTS

INDEPENDENT TELEPHONE & TELECOMMUNICATIONS

ALLIANCE, ET AL.,

INTERVENORS

Consolidated with 15-1078, 15-1086, 15-1090, 15-1091,

15-1092, 15-1095, 15-1099, 15-1117, 15-1128, 15-1151,

15-1164

On Petitions for Rehearing En Banc

Before: GARLAND*, Chief Judge; HENDERSON*, ROGERS,

T ATEL**, B ROWN ***, G RIFFITH , K AVANAUGH ***,

SRINIVASAN**, MILLETT, PILLARD*, and WILKINS, Circuit

Judges.

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ORDER

The petitions for rehearing en banc, the responses thereto,

and the brief of amici curiae were circulated to the full court,

and a vote was requested. Thereafter, a majority of the judges

eligible to vote did not vote in favor of the petitions. Upon

consideration of the foregoing, it is

ORDERED that the petitions be denied.

Per Curiam

FOR THE COURT:

Mark J. Langer, Clerk

BY: /s/

Ken Meadows

Deputy Clerk

* Chief Judge Garland and Circuit Judges Henderson and Pillard

did not participate in this matter.

** A statement by Circuit Judge Srinivasan, joined by Circuit

Judge Tatel, concurring in the denial of the petitions, is attached.

*** Circuit Judges Brown and Kavanaugh would grant the

petitions. Separate statements by Circuit Judge Brown and

Circuit Judge Kavanaugh, dissenting from the denial of the

petitions, are attached.

SRINIVASAN, Circuit Judge, joined by TATEL, Circuit

Judge, concurring in the denial of rehearing en banc:

In this case, a panel of our court upheld the FCC’s 2015

Open Internet Order, commonly known as the net neutrality

rule. The parties who unsuccessfully challenged the Order

before the panel have now filed petitions seeking review by

the full court sitting en banc. The court today denies en banc

review. En banc review would be particularly unwarranted at

this point in light of the uncertainty surrounding the fate of

the FCC’s Order. The agency will soon consider adopting a

Notice of Proposed Rulemaking that would replace the

existing rule with a markedly different one. See In re

Restoring Internet Freedom, FCC (Apr. 27, 2017),

https://apps.fcc.gov/edocs_public/attachmatch/DOC-344614A

1.pdf. In that light, the en banc court could find itself

examining, and pronouncing on, the validity of a rule that the

agency had already slated for replacement.

While we concur in the court’s denial of en banc review,

we write to respond to a particular contention pressed by one

of our dissenting colleagues: that the FCC’s Order, and thus

our panel decision sustaining it, departs from controlling

Supreme Court precedent in two distinct ways. First, our

colleague submits that Supreme Court decisions require clear

congressional authorization for rules like the net neutrality

rule, and the requisite clear statutory authority, he argues, is

absent here. See infra at 3-18 (Kavanaugh, J., dissenting);

accord infra at 18-23 (Brown, J., dissenting). Second, our

colleague contends that the rule conflicts with Supreme Court

decisions ostensibly arming internet service providers (ISPs)

with a First Amendment shield against net neutrality

obligations. See infra at 19-36 (Kavanaugh, J., dissenting).

Respectfully, both lines of argument are misconceived.

As to the first, the Supreme Court, far from precluding the

FCC’s Order due to any supposed failure of congressional

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authorization, has pointedly recognized the agency’s authority

under the governing statute to do precisely what the Order

does. As to the second, no Supreme Court decision supports

the counterintuitive notion that the First Amendment entitles

an ISP to engage in the kind of conduct barred by the net

neutrality rule—i.e., to hold itself out to potential customers

as offering them an unfiltered pathway to any web content of

their own choosing, but then, once they have subscribed, to

turn around and limit their access to certain web content based

on the ISP’s own commercial preferences.

Before taking up the merits of those two issues, we first

emphasize the role in which we examine them. The wisdom

of the net neutrality rule was, and remains, a hotly debated

matter. The FCC received the views of some four million

commenters before adopting the rule, In re Protecting and

Promoting the Open Internet, 30 FCC Rcd. 5601, 5604 ¶ 6

(2015) (Order), and the debate over the rule continues to this

day, with the agency now poised to consider replacing it. We

have no involvement in that ongoing debate. Our task is not

to assess the advisability of the rule as a matter of policy. It is

instead to assess the permissibility of the rule as a matter of

law. Does the rule lie within the agency’s statutory authority?

And is it consistent with the First Amendment? The answer

to both questions, in our view, is yes.

I.

According to our dissenting colleague, the FCC’s Order

runs afoul of a doctrine he gleans from certain Supreme Court

decisions invalidating an agency rule as lying outside the

agency’s congressionally delegated authority. Our colleague

understands those decisions to give rise to a “major rules”

doctrine. That doctrine is said to embody the following

understanding about the scope of agencies’ delegated

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authority: while agencies are generally assumed to possess

authority under Chevron U.S.A. Inc. v. Natural Resources

Defense Council, Inc., 467 U.S. 837 (1984), to issue rules

resolving statutory ambiguities, an agency can issue a major

rule—i.e., one of great economic and political significance—

only if it has clear congressional authorization to do so. See

infra at 4-5 (Kavanaugh, J., dissenting). Our other dissenting

colleague generally agrees with this line of argument

(although she calls the doctrine the “major questions” doctrine

rather than the “major rules” doctrine). See infra at 18-20

(Brown, J., dissenting).

We have no need in this case to resolve the existence or

precise contours of the major rules (or major questions)

doctrine described by our colleagues. Assuming the existence

of the doctrine as they have expounded it, and assuming

further that the rule in this case qualifies as a major one so as

to bring the doctrine into play, the question posed by the

doctrine is whether the FCC has clear congressional

authorization to issue the rule. The answer is yes. Indeed, we

know Congress vested the agency with authority to impose

obligations like the ones instituted by the Order because the

Supreme Court has specifically told us so.

The pertinent decision is National Cable &

Telecommunications Ass’n v. Brand X Internet Services, 545

U.S. 967 (2005). That case, like this one, addressed the

proper regulatory classification under the Communications

Act of broadband internet service. Brand X involved the

provision of broadband internet access via cable systems. At

the time of the decision, cable broadband was one of two

types of broadband service available to customers, the other

being DSL (digital subscriber line). See id. at 975.

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The FCC had applied a different form of regulatory

treatment to cable broadband service than to DSL service.

The agency had classified DSL as a “telecommunications

service” for purposes of the Communications Act. See id. at

975, 1000. That classification carries significant statutory

consequences. The Act requires treating telecommunications

providers as common carriers presumptively subject to the

substantial regulatory obligations attending that status. See id.

at 975-76. Common carriers, for instance, generally must

afford neutral, nondiscriminatory access to their services, and

must avoid unjust and unreasonable practices in that

connection. See id. at 975-76, 1000.

Whereas the FCC had classified DSL broadband as a

telecommunications service, the agency had instead elected to

classify cable broadband as an “information service,” the

other of the two classifications available to the agency under

the statute. See id. at 978. Providers of an information

service, in contrast with telecommunications providers, are

not considered to be common carriers under the Act. As a

result, providers of an information service are subject to less

extensive regulatory obligations and oversight than are

telecommunications providers. See id. at 975-76.

The issue in Brand X was whether the Communications

Act compelled the FCC to classify cable broadband ISPs as

telecommunications providers subject to regulatory treatment

as common carriers. The Court answered that question no.

Critically for our purposes, though, the Court made clear in its

decision—over and over—that the Act left the matter to the

agency’s discretion. In other words, the FCC could elect to

treat broadband ISPs as common carriers (as it had done with

DSL providers), but the agency did not have to do so.

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The Court, to that end, explained that it had “no difficulty

concluding that Chevron applie[d]” to the agency’s decision

to classify cable broadband as an information service rather

than a telecommunications service. Id. at 982. The statute’s

“silence” on the matter left the Commission “discretion to fill

the consequent statutory gap.” Id. at 997. That meant the

question “would be resolved, first and foremost, by the

agency.” Id. at 982 (internal quotation marks omitted); see id.

at 980-81. The Court repeatedly emphasized the

Commission’s authority to use “its expert policy judgment to

resolve these difficult questions.” Id. at 1003. In that light,

the proper classification of broadband service would turn “on

the factual particulars of how Internet technology works and

how it is provided, questions Chevron leaves to the

Commission to resolve in the first instance.” Id. at 991.

Consequently, the Court held, the court of appeals in

Brand X had “erred in refusing to apply Chevron to the

Commission’s interpretation of the definition of

‘telecommunications service,’” and in declining to defer to

the agency’s decision to treat cable broadband as an

information service. Id. at 984 (quoting 47 U.S.C. § 153(46)

(2000) (currently codified at 47 U.S.C. § 153(53)). But

deference equally would have been owed, the Supreme Court

made clear, if the FCC had reached the opposite resolution by

classifying cable broadband providers as telecommunications

carriers. That is because the agency had only two regulatory

classifications available to it. To affirm the FCC’s statutory

discretion to select between them was necessarily to

countenance the agency’s treatment of cable broadband as a

telecommunications service.

Indeed, the Court went as far as to affirmatively “leave[]

untouched” the court of appeals’s belief that the better reading

of the statute—albeit not the one that had been adopted by the

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agency—called for treating broadband providers as

telecommunications carriers. Id. at 985-86. And the Court

fully understood the significant regulatory implications if the

agency were instead to make that choice: classification as a

telecommunications service “would require applying

presumptively mandatory Title II [i.e., common carrier]

regulation to all ISPs.” Id. at 995 n.2.

The concurring and dissenting opinions in Brand X

reinforced the majority’s recognition of the agency’s statutory

authority to subject ISPs to regulation as common carriers.

Justice Breyer’s concurring opinion concluded that the FCC’s

decision to classify cable broadband as an information service

fell “within the scope of its statutorily delegated authority—

though perhaps just barely.” Id. at 1003 (Breyer, J.,

concurring). If the FCC’s election not to impose common

carrier obligations on cable broadband ISPs “just barely” fell

within the agency’s discretion, the opposite choice necessarily

would have fallen comfortably within the agency’s

congressionally delegated authority.

Justice Scalia’s dissenting opinion, joined by Justices

Souter and Ginsburg, went even further. According to Justice

Scalia, the statute permitted only one conclusion: cable

broadband ISPs “are subject to Title II regulation as common

carriers, like their chief competitors [e.g., DSL] who provide

Internet access through other technologies.” Id. at 1006

(Scalia, J., dissenting). The agency, in Justice Scalia’s view,

had no discretion to conclude otherwise. And he expressly

accepted that his reading of the Act would result in “common-

carrier regulation of all ISPs,” a result he considered “not a

worry.” Id. at 1011. (He noted, though, that the agency

possessed statutory authority to forbear from applying the full

range of common carrier regulatory obligations, id. at 1011-

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12, an authority the FCC exercised when it fashioned the rule

we now review, see Order ¶¶ 434-532.)

The upshot of Brand X with regard to the FCC’s

congressionally delegated authority over broadband ISPs is

unmistakable and straightforward. All nine Justices

recognized the agency’s statutory authority to institute

“common-carrier regulation of all ISPs,” with some Justices

even concluding that the Act left the agency with no other

choice. 545 U.S. at 1011 (Scalia, J., dissenting). In the Order

under review, the agency took up the Brand X Court’s

invitation. It decided to classify broadband ISPs as

telecommunications providers, enabling it to impose common

carrier obligations on ISPs such as the net neutrality rule in

question here.

In light of Brand X, our dissenting colleague’s reliance

on the “major rules” doctrine cannot carry the day. Recall

that the doctrine ultimately embodies an understanding about

congressional authorization: an agency, the doctrine says, can

adopt a major rule only if it clearly possesses congressional

authorization to do so. The major question at issue here,

according to our colleague, is whether the FCC can subject

broadband ISPs to common carrier obligations. See infra at

12-13 (Kavanaugh, J., dissenting). If we assume that the

FCC’s decision to treat broadband ISPs as common carriers

amounts to a major rule, the question then is whether the

agency clearly has authority under the Act to make that

choice. In Brand X, the Supreme Court definitively—and

authoritatively, for our purposes as an inferior court—

answered that question yes.

It bears emphasis in this regard that, by the time of Brand

X, two of the Supreme Court decisions cited by the dissent as

exemplars of the major rules doctrine—MCI

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Telecommunications Corp. v. Am. Telephone & Telegraph

Co., 512 U.S. 218 (1994), and FDA v. Brown & Williamson

Tobacco Corp., 529 U.S. 120 (2000)—had already been

decided. Brown & Williamson is particularly notable. There,

the Supreme Court considered the FDA’s exercise of its

general rulemaking authority under the Food, Drug, and

Cosmetic Act to regulate the use of tobacco products by

children and adolescents. The Court, although applying

principles of Chevron deference to the FDA’s assertion of

authority over tobacco products, concluded that Congress did

not “delegate a decision of such economic and political

significance to an agency in so cryptic a fashion.” Id. at 160.

Later, in Brand X, the Court reached a different

conclusion about the FCC’s regulatory authority over ISPs.

The Court, again applying Chevron, this time concluded that

Congress had authorized the agency to decide whether to

regulate ISPs as common carriers. As between the two

possible classifications, “the Commission’s choice of one of

them is entitled to deference.” Brand X, 545 U.S. at 989.

We note, further, that there is no material difference

between the technology considered in Brand X and the

technology at issue here. The petitioning parties have

contended throughout this case that Brand X involved only

something referred to as the “last mile” of internet service.

But the panel straightforwardly (and unanimously) rejected

their effort to make anything of that supposed distinction. See

U.S. Telecom Ass’n v. FCC, 825 F.3d 674, 702 (D.C. Cir.

2016); id. at 745 (Williams, J., concurring in part and

dissenting in part). Our dissenting colleague likewise makes

no effort to distinguish Brand X on such a basis. Rather, both

cases involve “the FCC’s authority to classify Internet service

as a telecommunications service.” Infra at 17 (Kavanaugh, J.,

dissenting); but see infra 22-23 (Brown, J., dissenting). And

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Brand X, in clearly recognizing the agency’s authority to do

so under the Act, negates any argument under the major rules

doctrine that the FCC lacked statutory authority to issue the

Order we now review.

Our dissenting colleague nonetheless contends that

Brand X poses no obstacle to invalidating the FCC’s Order

under the major rules doctrine. His argument runs as follows.

The question under the major rules doctrine, he observes, is

whether Congress has “clearly authorized the FCC to subject

Internet service providers to the range of burdensome

common-carrier regulations associated with

telecommunications services.” Infra at 16 (Kavanaugh, J.,

dissenting). But the Brand X Court, he then notes, found the

statute “ambiguous about whether Internet service was an

information service or a telecommunications service.” Id. at

17. In his view, “Brand X’s finding of ambiguity by

definition means that Congress has not clearly authorized the

FCC to issue the net neutrality rule.” Id. at 18.

That analysis rests on a false equivalence: it incorrectly

equates two distinct species of ambiguity. It is one thing to

ask whether “Internet service is clearly a telecommunications

service under the statute.” Id. at 16. It is quite another thing

to ask whether Congress has “clearly authorized the FCC to

classify Internet service as a telecommunications service,”

which is the relevant question under our colleague’s

understanding of the major rules doctrine. Id. The former

question asks whether the statute itself clearly classifies ISPs

as telecommunications providers. The latter asks whether the

statute clearly authorizes the agency to classify ISPs as

telecommunications providers.

Our colleague assumes that, if the answer to the former

question is no, “that is the end of the game for the net

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neutrality rule.” Id. at 17. Not at all. A negative answer to

the former question hardly dictates a negative answer to the

latter, more salient, one. The statute itself might be

ambiguous about whether ISPs are to be treated as common

carriers, but still be clear in authorizing the agency to resolve

the question.

Indeed, that dichotomy perfectly captures Brand X’s

holding. Justice Scalia, in dissent, believed that the statute

clearly compelled treating ISPs as telecommunications

providers. The majority disagreed, finding the statute

ambiguous on the question. But the majority found that the

agency was empowered to resolve the ambiguity—i.e., to

decide whether ISPs should be classified as

telecommunications providers presumptively subject to

common carrier obligations. In short, whereas Brand X found

statutory ambiguity on whether ISPs are telecommunications

providers, the decision found no statutory ambiguity on

whether the FCC gets to answer that question.

So understood, Brand X dictates rejecting our dissenting

colleague’s argument based on the major rules doctrine. It is

thus perhaps unsurprising that none of the petitioning parties,

no member of the original panel (including our colleague who

dissented in part at the panel stage), and neither of the

dissenting Commissioners objected to the FCC’s Order as

infringing any such doctrine. (We note, though, that a group

of intervenors led by TechFreedom makes such an argument.)

The major rules doctrine is said to promote separation-of-

powers principles by assuring that Congress has delegated

authority to an Executive agency to decide a major matter of

policy. See infra at 3-5 (Kavanaugh, J., dissenting). But in

light of Brand X’s recognition of the FCC’s congressionally

delegated authority to decide whether to regulate ISPs as

common carriers, it would disserve—not promote—the

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separation of powers to deny the agency the authority

conferred on it by Congress.

In the end, the major rules doctrine, as articulated by our

colleague, affords no basis for invalidating the net neutrality

rule. The Supreme Court decisions ostensibly giving rise to

that doctrine lie far afield from this case. They involve, per

our colleague’s description, “regulating cigarettes, banning

physician-assisted suicide, eliminating telecommunications

rate-filing requirements, or regulating greenhouse gas

emitters.” Id. at 9. The Court’s decision in Brand X, by

contrast, involved the same statute (the Communications Act),

the same agency (the FCC), the same factual context (the

provision of broadband internet access), and the same issue

(whether broadband ISPs are telecommunications providers,

and hence common carriers, under the Act). Brand X

unambiguously recognizes the agency’s statutorily delegated

authority to decide that issue.

Does Brand X, then, necessarily validate the agency’s

decision to classify broadband ISPs as telecommunications

providers and to subject them to common carrier obligations?

No, it does not. While Brand X recognizes the FCC’s

statutory authority to treat broadband ISPs as common

carriers, the agency must carry out its authority in a

reasonable and non-arbitrary way. The partial dissent from

the panel’s disposition believed that the FCC’s Order fell

short on those grounds, and the petitioning parties have raised

a host of challenges to the agency’s decisionmaking process

and outcome. The panel majority concluded otherwise and

upheld the rule.

But while Brand X could not have settled the validity of a

rule the FCC had yet to promulgate, it did settle the agency’s

authority to classify broadband ISPs as telecommunications

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providers under the Communications Act. The major rules

doctrine, as conceptualized by our dissenting colleague, is a

heuristic for determining whether a given rule falls within an

agency’s congressionally delegated authority. Once the

Supreme Court says that a rule does so—as Brand X did with

regard to the FCC’s authority to treat ISPs as common

carriers—our inquiry is over. Insofar as the FCC’s Order

involves a major rule, then, Brand X resolves the agency’s

statutory authority to adopt it.

II.

Our dissenting colleague separately argues that the First

Amendment poses an independent bar to the FCC’s Order.

The Order, he submits, infringes the First Amendment rights

of broadband ISPs. Specifically, he understands Supreme

Court precedent to recognize a First Amendment entitlement

on the part of an ISP to block its subscribers from accessing

certain internet content based on the ISP’s own preferences,

even if the ISP has held itself out as offering its customers an

indiscriminate pathway to internet content of their own—not

the ISP’s—choosing.

Under that view, an ISP, for instance, could hold itself

out to consumers as affording them neutral, indiscriminate

access to all websites, but then, once they subscribe,

materially degrade their ability to use Netflix for watching

video—or even prevent their access to Netflix altogether—in

an effort to steer customers to the ISP’s own competing

video-streaming service. Alternatively, an ISP, again having

held itself out as affording its customers an unfiltered conduit

to internet content, could block them from accessing (or

significantly delay their ability to load) the Wall Street

Journal’s or the New York Times’s website because of a

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disagreement with the views expressed on one or the other

site.

An ISP has no First Amendment right to engage in those

kinds of practices. No Supreme Court decision suggests

otherwise. Indeed, although the two dissenting FCC

Commissioners objected to the agency’s adoption of the rule

on multiple grounds, neither suggested the rule poses any

First Amendment issue. Similarly, the principal parties

challenging the Order in this court, who collectively represent

virtually every broadband provider—including all of the

major ISPs—bring no First Amendment challenge to the rule.

The sole party to raise any claim under the First Amendment

is Alamo Broadband Inc., which describes itself as “a small

broadband provider” serving some 1,000 customers in Texas,

and which is joined in its claim by an individual named

Daniel Berninger. Pet’rs’ Joint Proposed Briefing Format &

Sched. 8; Alamo Br. 3.

Notwithstanding the arguments presented by Alamo and

Berninger—and now also our dissenting colleague—the

consensus view is correct: the net neutrality rule raises no

issue under the First Amendment. The key to understanding

why lies in perceiving when a broadband provider falls within

the rule’s coverage. As the Order explains, broadband ISPs

that are subject to the rule “sell retail customers the ability to

go anywhere (lawful) on the Internet”—they “represent[] that

they will transport and deliver traffic to and from all or

substantially all Internet endpoints.” Order ¶ 27; see id.

¶¶ 15, 350. They “display no . . . intent to convey a message

in their provision” of internet access, id. ¶ 549, as would be

necessary “to bring the First Amendment into play,” Texas v.

Johnson, 491 U.S. 397, 404 (1989).

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In particular, “[b]roadband providers” subject to the rule

“represent that their services allow Internet end users to

access all or substantially all content on the Internet, without

alteration, blocking, or editorial intervention.” Id. ¶ 549

(emphasis added). Customers, “in turn, expect that they can

obtain access to all content available on the Internet, without

the editorial intervention of their broadband provider.” Id.

(emphasis added). Therefore, as the panel decision held and

the agency has confirmed, the net neutrality rule applies only

to “those broadband providers that hold themselves out as

neutral, indiscriminate conduits” to any internet content of a

subscriber’s own choosing. U.S. Telecom Ass’n, 825 F.3d at

743; see FCC Opp’n Pets. Reh’g 28-29.

For a broadband ISP that holds itself out to consumers as

a “neutral, indiscriminate conduit”—i.e., as a pathway to “all

content on the Internet, without alteration, blocking, or

editorial intervention,” Order ¶ 549—the rule requires the ISP

to abide by its representation and honor its customers’

ensuing expectations. The ISP therefore cannot block its

subscribers’ access to certain websites based on its own

preferences. Nor can it engage in “throttling,” which, while

stopping short of outright blocking, degrades a user’s

experience with selected content so as to render it largely,

even if not technically, “unusable.” Id. ¶ 17. Nor can an ISP

create “fast lanes” favoring content providers who pay the ISP

(or with whom it has a commercial affiliation), while

relegating disfavored (i.e., nonpaying) providers to “slow

lanes.” Id. ¶¶ 18, 126. Like blocking and throttling, paid

prioritization practices of that variety are incompatible with a

promise to provide a neutral, indiscriminate pathway to

content of a customer’s own choosing.

The upshot of the FCC’s Order therefore is to “fulfill the

reasonable expectations of a customer who signs up for a

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broadband service that promises access to all of the lawful

Internet” without editorial intervention. Id. ¶¶ 17, 549. The

FCC found that, once a consumer subscribes to a particular

broadband service in reliance on such a promise, she faces

high switching costs constraining her ability to shift away

from her ISP if it reneges on its representation by blocking

her access to select content. See id. ¶¶ 80-82, 97-99. The

agency further explained that a subscriber might well have no

awareness of her ISP’s practices of that kind in the first place:

she may have no reason to suppose that her inability to access

a particular application, or that the markedly slow speeds she

confronts when attempting to use it, derives from her ISP’s

choices rather than from some deficiency in the application.

See id. ¶¶ 81, 99. After all, if a subscriber encounters

frustratingly slow buffering of videos when attempting to use

Netflix, why would she naturally suspect the fault lies with

her ISP rather than with Netflix itself?

While the net neutrality rule applies to those ISPs that

hold themselves out as neutral, indiscriminate conduits to

internet content, the converse is also true: the rule does not

apply to an ISP holding itself out as providing something

other than a neutral, indiscriminate pathway—i.e., an ISP

making sufficiently clear to potential customers that it

provides a filtered service involving the ISP’s exercise of

“editorial intervention.” Id. ¶ 549. For instance, Alamo

Broadband, the lone broadband provider that raises a First

Amendment challenge to the rule, posits the example of an

ISP wishing to provide access solely to “family friendly

websites.” Alamo Pet. Reh’g 5. Such an ISP, as long as it

represents itself as engaging in editorial intervention of that

kind, would fall outside the rule. See U.S. Telecom Ass’n, 825

F.3d at 743; FCC Opp’n Pets. Reh’g 28-29; FCC Br. 146

n.53. The Order thus specifies that an ISP remains “free to

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offer ‘edited’ services” without becoming subject to the rule’s

requirements. Order ¶ 556.

That would be true of an ISP that offers subscribers a

curated experience by blocking websites lying beyond a

specified field of content (e.g., family friendly websites). It

would also be true of an ISP that engages in other forms of

editorial intervention, such as throttling of certain applications

chosen by the ISP, or filtering of content into fast (and slow)

lanes based on the ISP’s commercial interests. An ISP would

need to make adequately clear its intention to provide “edited

services” of that kind, id. ¶ 556, so as to avoid giving

consumers a mistaken impression that they would enjoy

indiscriminate “access to all content available on the Internet,

without the editorial intervention of their broadband

provider,” id. ¶ 549. It would not be enough under the Order,

for instance, for “consumer permission” to be “buried in a

service plan—the threats of consumer deception and

confusion are simply too great.” Id. ¶ 19; see id. ¶ 129.

There is no need in this case to scrutinize the exact

manner in which a broadband provider could render the

FCC’s Order inapplicable by advertising to consumers that it

offers an edited service rather than an unfiltered pathway. No

party disputes that an ISP could do so if it wished, and no ISP

has suggested an interest in doing so in this court. That may

be for an understandable reason: a broadband provider

representing that it will filter its customers’ access to web

content based on its own priorities might have serious

concerns about its ability to attract subscribers. Additionally,

such a provider, by offering filtered rather than indiscriminate

access, might fear relinquishing statutory protections against

copyright liability afforded to ISPs that act strictly as conduits

to internet content. See 17 U.S.C. § 512; Recording Indus.

17

Ass’n of Am., Inc. v. Verizon Internet Servs., Inc., 351 F.3d

1229, 1233, 1237 (D.C. Cir. 2003).

In the event that an ISP nonetheless were to choose to

hold itself out to consumers as offering them an edited service

rather than indiscriminate internet access—despite the

potential effect on its subscriber base—it could then bring

itself outside the rule. In that sense, the rule could be

characterized as “voluntary,” infra at 25-26 n.8 (Kavanaugh,

J., dissenting), but in much the same way that just about any

regulation could be considered voluntary, insofar as a

regulated entity could always transform its business to such

an extent that it is no longer in the line of business covered by

the regulation.

Here, it would be no small matter for an ISP to decide to

present itself to potential customers as providing a

fundamentally different product—an edited service—than the

neutral, indiscriminate access generally promised by ISPs and

expected by consumers as standard service. No ISP has

indicated in this court a desire to represent itself to consumers

as affording them less of a “go wherever you’d like to go”

service and more of a “go where we’d like you to go” service.

Accordingly, Alamo Broadband, the only ISP to raise a First

Amendment claim, makes no argument that it holds itself out

as offering filtered access to web content, as opposed to

offering an indiscriminate pathway to any content of its

subscribers’ own choosing. Alamo nonetheless claims a First

Amendment entitlement to filter its subscribers’ access to web

content through blocking, throttling, and paid prioritization

measures.

Alamo contends, for instance, that a broadband provider

has a First Amendment right to provide faster access to its

own video-streaming service than to a competing product.

18

Alamo Reh’g Pet. 9. If so, an ISP could similarly afford fast-

lane access (because paid to do so) to a particular service that

sells tickets to concert events while degrading access to

Ticketmaster, even though a customer might lose out on

preferred seats while waiting for Ticketmaster to work. The

same would be true of measures favoring (or disfavoring)

specific ride-sharing applications (e.g., Uber), travel websites

(e.g., Expedia), or video-chat services (e.g., Skype),

potentially causing customers, respectively, to wait longer for

rides, to miss out on flight reservations at fares available for a

limited period, or to fail to connect with family or friends for

face-to-face interactions. Alternatively, the ISP could simply

block access altogether rather than merely slow it down.

In all of those situations, an ISP would have held itself

out as offering its customers unfiltered access to all internet

content, but then would prevent them from accessing—or

otherwise impair their ability to use—selected content it

disfavors. The First Amendment does not give an ISP the

right to present itself as affording a neutral, indiscriminate

pathway but then conduct itself otherwise. The FCC’s Order

requires ISPs to act in accordance with their customers’

legitimate expectations. Nothing in the First Amendment

stands in the way of establishing such a requirement in the

form of the net neutrality rule.

Contrary to our dissenting colleague’s argument, the

Supreme Court’s Turner Broadcasting decisions do not grant

ISPs a First Amendment shield against the net neutrality

rule’s obligations. See infra at 21-23 (Kavanaugh, J.,

dissenting). Those decisions arose in a markedly different

context. They addressed the validity under the First

Amendment of statutory “must-carry” requirements calling

for cable television operators to “devote a portion of their

channels to the transmission of local broadcast television

19

stations.” Turner Broad. Sys., Inc. v. FCC, 512 U.S. 622,

626, 630 (1994); see Turner Broad. Sys., Inc. v. FCC, 520

U.S. 180 (1997).

The Supreme Court ultimately upheld the must-carry

obligations. In the process of doing so, however, the Court

recognized that a cable operator’s choices about which

programming to carry on its channels implicate the First

Amendment’s protections. That is because a cable operator

engages in protected First Amendment activity when it

“exercis[es] editorial discretion over which stations or

programs to include in its repertoire.” Turner Broad., 512

U.S. at 636 (internal quotation marks omitted).

The same cannot be said of broadband providers subject

to the FCC’s Order. Whereas a cable operator draws the

protections of the First Amendment when it exercises editorial

discretion about which programming to carry, an ISP falling

within the net neutrality rule represents that it gives

subscribers indiscriminate access to internet content without

any editorial intervention. Cable operators, that is, engage in

editorial discretion; ISPs subject to the net neutrality rule

represent that they do not. The very practice bringing cable

operators within the fold of the First Amendment’s

protections is inapplicable in the case of broadband providers

subject to the net neutrality rule.

For that reason, our dissenting colleague gains little by

emphasizing that the same cable operators recognized to have

First Amendment interests at stake in Turner Broadcasting

also serve as broadband ISPs. See infra at 23 (Kavanaugh, J.,

dissenting). Our colleague thinks it entirely illogical to

conclude that those entities receive First Amendment

protection when transmitting television programming under

must-carry obligations but not when transmitting internet

20

content under the net neutrality rule. The distinction becomes

entirely understandable, however, upon recognizing that cable

operators exercise editorial discretion in the former situation

but disclaim any exercise of editorial intervention in the latter.

Indeed, the cable operators themselves evidently

appreciate a distinction. In Turner Broadcasting, the party

standing in the shoes of cable operators, presenting oral

argument and briefing on their behalf, was NCTA (which then

stood for National Cable Television Association). See 520

U.S. at 184; 512 U.S. at 625. Here, NCTA again represents

cable operators, this time in their capacity as broadband

providers. See, e.g., U.S. Telecom Ass’n, 825 F.3d at 687. In

Turner Broadcasting, NCTA persuaded the Court that cable

operators engage in protected First Amendment activity when

selecting the television programming to include in their

channel lineups. Yet here, the very same party—tellingly—

raises no First Amendment challenge at all. It says quite a lot

when the party that presumably understands better than

anyone the import of the Turner Broadcasting decisions for

cable operators apparently perceives no viable First

Amendment objection to the net neutrality rule under those

decisions. (That NCTA may have raised First Amendment

concerns about previous net neutrality obligations, see infra

28 n.9 (Kavanaugh, J., dissenting), only magnifies its decision

to forgo any such objection to the current rule.)

Our dissenting colleague presents a number of associated

arguments emanating from his belief that Turner

Broadcasting vests broadband providers with First

Amendment protections when they block and throttle internet

content. Those arguments, however, tend to fall away once

one understands—as cable operators themselves evidently

do—the inapplicability of Turner Broadcasting to this case.

21

As an example, our colleague rejects what he perceives to

be the FCC’s “use it or lose it” conception of First

Amendment rights. See infra at 24 (Kavanaugh, J.,

dissenting). But the chief reason the net neutrality rule raises

no First Amendment problem is not that ISPs have lost their

First Amendment rights by refraining from actively filtering

the internet content they transmit to subscribers. The lack of a

viable First Amendment claim stems from what ISPs have (or

have not) said, not from what they have (or have not) done.

When a broadband provider holds itself out as giving

customers neutral, indiscriminate access to web content of

their own choosing, the First Amendment poses no obstacle to

holding the provider to its representation. That amounts to an

“if you say it, do it” theory, not a “use it or lose it” theory.

Our dissenting colleague likewise errs in fearing a

slippery slope under which the government could require

widely used web platforms such as Facebook, Google,

Twitter, and YouTube, or a widely used commercial

marketplace such as Amazon, to accept or promote all

relevant content on nondiscriminatory terms. See infra at 25,

33 (Kavanaugh, J., dissenting). Those companies evidently

do not share our colleague’s concern—all but one is a

member of a group that supports the rule in this court. See

Internet Association Amicus Br. in Support of Resp’ts iv.

That may be in part because those companies, in contrast with

broadband ISPs, are not considered common carriers that hold

themselves out as affording neutral, indiscriminate access to

their platform without any editorial filtering. If an agency

sought to impose such a characterization on them, they would

presumably disagree. Here, by contrast, the rule applies only

to ISPs that represent themselves as neutral, indiscriminate

conduits to internet content, and no ISP subject to the rule—

including Alamo Broadband—has disclaimed that

characterization in this court.

22

The real slippery-slope concerns run in the reverse

direction. Under our dissenting colleague’s approach,

broadband ISPs would have a First Amendment entitlement to

block and throttle content based on their own commercial

preferences even if they had led customers to anticipate

neutral and indiscriminate access to all internet content.

There is no apparent reason the same conclusion would not

also obtain in the case of telephone service, which, like

broadband service, is classified as common carriage.

Imagine if a telephone provider held itself out as an

indiscriminate conduit for phone communications but wished

to block or impair access to select endpoints based on the

provider’s own editorial preferences. A telephone company

might, for example, restrict access to certain numbers based

on political affiliation or other criteria. The company would

have an entitlement to do so under our colleague’s

understanding of the First Amendment.

Our colleague suggests that telephone companies differ

from broadband providers in that they generally do not carry

“mass communications.” Infra at 34 n.13 (Kavanaugh, J.,

dissenting). But speech directed to a finite audience is no less

protected than speech available on a broader scale. And the

category of “mass communications,” in any event, is hardly

self-defining. One can readily envision circumstances in

which telephone service would fairly be considered to involve

mass communication (text messages or recorded voice

messages designed to reach a broad audience, for instance).

Our colleague’s understanding of broadband providers’ First

Amendment rights would arm telephone companies with

parallel rights to block or filter phone service, contradicting a

long history of uncontroversial regulation of that service.

23

For all of those reasons, broadband ISPs have no First

Amendment entitlement to hold themselves out as

indiscriminate conduits but then to act as something different.

The net neutrality rule assures that broadband ISPs live up to

their promise to consumers of affording them neutral access

to internet content of their own choosing. The rule, in doing

so, does not infringe the First Amendment.

BROWN, Circuit Judge, dissenting from the denial of

rehearing en banc: An independent federal agency sits at the

intersection of the road to the White House and Constitution

Avenue. Two statues that capture struggle between man and

horse flank the agency. The statues are called “Man

Controlling Trade,” and they depict a man, the government,

restraining a horse, the marketplace. Though the statues look

similar, they are not the same. On the President’s road, the

horse—the marketplace—looks threatening, as if it will topple

the brawny man trying to grasp the reins. On Constitution

Avenue, the man—the government—is the threatening one,

grasping the reins on both sides of the animal’s head; it appears

he is trying to overpower a valiant and sympathetic horse.

Here, as with the statues, an independent agency sits at the

crossroads of competing visions—the President’s view of the

Internet as threatening consumers, and the libertarian view of

government as strangling the greatest market innovation of the

last century. But an orthodox view of checks and balances

leaves the choice of vision to Congress.

Congress passed, and President Clinton signed, the

Telecommunications Act of 1996 (the “Act”), and its meaning

could not be clearer: “to preserve the vibrant and competitive

free market that presently exists for the Internet . . ., unfettered

by Federal or State regulation.” 47 U.S.C. § 230(b)(2)

(emphasis added). For nearly two decades, the federal

government respected the Act’s deregulatory policy.

Presidents enforced it, Congresses did not alter it, and the

Federal Communications Commission (“FCC” or the

“Commission”) gave the Internet only a light-touch regulation.

When FCC regulation went beyond a light touch, this Court

intervened. See Verizon v. FCC, 740 F.3d 623, 629–30, 650–

59 (D.C. Cir. 2014). However, the regulatory proposal now

before the Court seeks to end this longstanding consensus.

When the FCC followed the Verizon “roadmap” to

implement “net neutrality” principles without heavy-handed

2

regulation of Internet access, the Obama administration

intervened. Through covert and overt measures, FCC was

pressured into rejecting this decades-long, light-touch

consensus in favor of regulating the Internet like a public

utility. This sea change places the Commission in control of

Internet access. G. Nagesh & B. Mullins, Net Neutrality: How

White House Thwarted FCC Chief, WALL ST. J. (Feb. 4, 2015).

Abandoning Congress’s clear, deregulatory policy does

more than subject Internet access to a regulatory framework fit

for the horse and buggy. The FCC’s statutory rewrite relegates

the Constitution’s vital separation of powers framework to “a

mere parchment delineation of the boundaries;” a hollow

guarantee of liberty. See THE FEDERALIST NO. 73 (Hamilton),

p. 441 (Clinton Rossiter ed., 1961). If we take the

Constitution’s structural restraints seriously, we cannot wish

the Commission bon voyage on its Presidentially-imposed

journey to become the Federal Cyberspace Commission. As

that is exactly what the Court’s Opinion does, I respectfully

dissent from the denial of rehearing en banc. 1

I.

The Act’s Deregulatory Structure

1

The Judges concurring in today’s denial of rehearing note “[t]he

[FCC] will soon consider adopting a Notice of Proposed Rulemaking

that would replace the existing rule with a markedly different one.”

Concurral at 1. For this reason, they consider en banc review

“particularly unwarranted at this point.” Id. Of course, en banc

review is not now at issue. The motions to rehear this case were filed

in August of last year when rehearing would certainly have been

appropriate. Moreover, regardless of any future FCC action, the

broad implications of this Court’s Panel Opinion remain; Supreme

Court involvement may yet be warranted.

3

Congress passed the Telecommunications Act of 1996 to

amend the Communications Act of 1934, and in doing so,

protect the innovation animating the Internet. See

Telecommunications Act of 1996, Pub. L. No. 104-104, 110

Stat. 56 (1996) (“An Act [t]o promote competition and reduce

regulation in order to secure lower prices and higher quality

services for American telecommunications consumers and

encourage the rapid deployment of new telecommunications

technologies.”). The Act found that the “Internet and other

interactive computer services have flourished, to the benefit of

all Americans, with a minimum of government regulation.” 47

U.S.C. § 230(a)(4) (emphasis added). Accordingly, Congress

made keeping the Internet “unfettered” by “regulation” our

national policy. Id. § 230(b)(2). Achieving this policy required

a commitment to deregulatory tools and standards. The Act

provided exactly that.

A.

Internet Access As An Information Service

As the Supreme Court explained, the 1996 Act

incorporated FCC’s prior practice of distinguishing “basic

services,” which are provided by “telecommunications

services,” and “enhanced services,” which are provided by

“information services.” See National Cable &

Telecommunications Ass’n v. Brand X Internet Services, 545

U.S. 967, 975–77 (2005) (“Brand X”). “These two statutory

classifications originated in the late 1970’s, as the Commission

developed rules to regulate data-processing services offered

over telephone wires.” Id. at 976.

“Basic services,” the analogue to the 1996 Act’s

“telecommunications services,” were defined as “a pure

transmission capability over a communications path that is

4

virtually transparent in terms of its interaction with customer

supplied information.” Id. “[N]o computer processing or

storage of the information” was part of “basic services,”

“other than the processing or storage needed to convert the

message into electronic form and then back into the ordinary

language for purposes of transmitting it over the network—

such as a telephone or facsimile.” Id. (emphasis added). The

FCC, and then Congress in 1996, subjected these “basic

services,” these “telecommunications services,” to common

carrier regulation. Id.

“Enhanced services” are the analogue to “information

services” in the 1996 Act, and they are not subject to common

carrier regulation. Id. at 977. The Commission historically

defined “enhanced services” to be those where “computer

processing applications [were] used to act on the content, code,

protocol, and other aspects of the subscriber’s information,”

like voicemail. See id. at 976–77. The regulatory rub with

“enhanced service,” as it is here with Internet access, is that it

may be “offered via transmission wires” that, themselves, may

constitute a “basic” or “telecommunications service.” See id.

at 977. Nevertheless, “given the fast-moving, competitive

market” in which [enhanced services] were offered,” the FCC

did not subject them to common carrier regulation. Id.

Just so, when Congress exempted “information services”

from common carrier regulation in 1996, it followed the FCC’s

longstanding course. See id. at 992 (“Congress passed the

definitions in the Communications Act against the background

of this regulatory history, and we may assume that the parallel

terms ‘telecommunications service’ and ‘information service’

substantially incorporated their meaning, as the Commission

has held.”). The statute says “interactive computer service”

includes “any” provider of “information service,” and

“specifically a service or system that provides access to the

5

Internet.” See 47 U.S.C. § 230(f)(2) (emphasis added). The

Act also specifically excludes “telecommunications services”

from the definition of “Internet access service.” Id. § 231(e)(4).

Unsurprisingly, the Act’s definition of “information

service” fits broadband Internet access like a glove.

“[G]enerating, acquiring, storing,” or “making available

information via telecommunications” is what users do on social

media websites like Facebook. See id. § 153(24).

“[T]ransforming” or “utilizing” “information via

telecommunications” is what users do on YouTube. See id.

“[A]cquiring, storing,” and “retrieving . . . information via

telecommunications” is what users do with email. See id. The

“offering of a capability” for engaging in all of these activities

is exactly what is provided by broadband Internet access. See

id.

B.

Authority To Forbear Burdensome Regulations

Before the 1996 Act, FCC sought to deregulate aspects of

the telecommunications industry on its own authority. But, its

assertions of inherent power to “forbear” common carrier

regulations engendered judicial skepticism. See, e.g., MCI

Telecomms. Corp. v. AT&T, 512 U.S. 218, 234 (1994) (“[T]he

Commission’s desire to ‘increase competition’ cannot provide

[it] authority to alter the well-established statutory filed rate

requirements . . . . [S]uch considerations address themselves to

Congress, not to the courts”); AT&T v. FCC, 978 F.2d 727, 736

(D.C. Cir. 1992) (“We understand fully why the Commission

wants the flexibility to apply the tariff provisions of the

Communications Act . . . . But the statute, as we have

interpreted it, is not open to the Commission’s construction.

The Commission will have to obtain congressional sanction for

6

its desired policy course.”). Heeding these admonitions,

Congress gave FCC statutory authority to forbear common

carrier regulations in the 1996 Act. See Telecommunications

Act of 1996, Pub. L. No. 104-104 § 401, 110 Stat. 56, 128

(1996) (entitled “Regulatory Forbearance” and inserting this

section into the Communications Act’s Title I). Logically,

forbearance is a tool for lessening common carrier regulation,

not expanding it.

The authority to forbear regulation is limited to certain

circumstances. FCC is only permitted to forbear when it has

shown the common carriage provision is not needed: (1) to

ensure just and reasonable prices and practices; or (2) to protect

consumers. Forbearance must also be in the public interest.

See 47 U.S.C. § 160(a).

C.

Mobile Broadband Cannot Be Common Carriage

The 1996 Act also ensured providers of mobile broadband

Internet access “shall not . . . be treated as a common carrier for

any purpose.” See 47 U.S.C. § 332(c)(2) (emphasis added).

Section 332 specifies only a commercial mobile service (or a

“functional equivalent”) can be subject to common carrier

regulation. Id. §§ 332(c)(1)(A), (c)(2), (d)(3). “Private mobile

service,” in contrast, is “any mobile service” that is not a

commercial one, and it may not be regulated as a common

carrier. See id. § 332(d)(3). Section 332 defines “commercial

mobile service” as a mobile service “provided for profit [that]

makes interconnected service available [to the public].” Id. §

332(d)(1). The section then defines “interconnected service”

as a “service that is interconnected with the public switched

network (as such terms are defined by regulation by the

[FCC]).” Id. § 332(d)(2). The FCC—until the Order at issue

7

here—always defined “interconnected service” as “giv[ing]

subscribers the capability to communicate . . . [with] all other

users on the public switched network.” See 47 C.F.R. § 20.3

(1994) (emphasis added). “[T]he public switched network”

was, in turn, defined as the “common carrier switched network

. . . that use[s] the North American Numbering Plan.” Id. In

other words, “the public switched network” is the telephone

network. Though it is legislative history, the 1996 Act’s

Conference Report buttresses this textual reading. See H.R.

Rep. No. 103-213, at 495 (1993) (characterizing the House

version of Section 332 as interconnection with “the Public

switched telephone network,” even as both the House and

Senate versions of Section 332 referred to “the public switched

network”) (emphasis added), reprinted in 1993 U.S.C.C.A.N.

1088, 1184. Moreover, § 332(d)(2) refers to one network: “the

public switched network.” In other words, the fact that another

network can connect to the telephone network does not make

that other network part of “the public switched network.”

II.

FCC Practice Preserved The Free Market For Internet

Access

It is bizarre that the FCC is now disputing the notion that

Congress would “attempt to settle the regulatory status of

broadband Internet access services” with the 1996 Act. See Op.

34–35. Barely more than a year after the 1996 Act, Congress

charged the FCC with assessing “the definitions of

‘information service’ . . . [and] ‘telecommunications service’”

in the Act, and “the application of those definitions to mixed or

hybrid services . . . including with respect to Internet access.”

See Dep’ts of Commerce, Justice, and State, the Judiciary, and

Related Agencies Appropriations Act, 1998, Pub. L. No. 105-

119, § 623, 111 Stat. 2440, 2521 (1997). What is this but

8

inquiring into “the regulatory status” of Internet access in the

1996 Act and whether Congress was satisfied with its scheme?

The Commission’s report, known as the Universal Service

Report, made several conclusions confirming the text, history,

and structure of the 1996 Act properly classified Internet access

service as “information service.” See, e.g., Federal-State Joint

Board on Universal Service, Report to Congress, FCC 98-67,

13 FCC Rcd. 11501, 11513–14 ¶ 27, 11536–40 ¶¶ 74–82

(1998) (hereinafter Universal Service Report). In this report,

the FCC also endorsed the view of five Senators saying

“[n]othing in the 1996 Act or its legislative history suggests []

Congress intended to alter the current classification of Internet

and other information services or to expand traditional

telephone regulation to new and advanced services.” Id. at

11520 ¶¶ 38–39. As the Senators’ view parallels the

conclusions reached within the Universal Service Report, and

their view is quite prescient, their letter is worth quoting at

length:

This unparalleled success [in Internet access]

has emerged in the context of policies that favor

market forces over government regulation—

promoting the growth of innovative, cost-

effective, and diverse quality services. It is this

same pro-competitive mandate that is at the

heart of the 1996 Act. . . . Simply put, Congress

has not required the FCC to prepare and submit

a Report on Universal Service that alters this

successful and historic policy. Moreover, were

the FCC to reverse its prior conclusions and

suddenly subject some or all information

service providers to telephone regulation, it

seriously would chill the growth and

development of advanced sciences to the

9

detriment of our economic and educational

well-being.

Some have argued Congress intended that the

FCC’s implementing regulations be expanded

to reclassify certain information service

providers, specifically Internet Service

Providers (ISPs), as telecommunications

carriers. Rather than expand regulation to new

service providers, a critical goal of the 1996 Act

was to diminish regulatory burdens as

competition grew. Significantly, this goal has

been the springboard for sound

telecommunications policy throughout the

globe, and underscores U.S. leadership in this

area. The FCC should not act to alter this

approach.

Letter from Senators John Ashcroft, Wendell Ford, John Kerry,

Spencer Abraham, and Ron Wyden to the Honorable William

E. Kennard, Chairman, FCC (Received Mar. 23, 1998),

http://apps.fcc.gov/ecfs/document/view?id=2038710001

(emphasis added).

The FCC heeded the Universal Service Report’s

conclusions in subsequent Orders. In its Advanced Services

Order, the FCC characterized the “last mile” of Digital

Subscriber Line services (DSL services), or “broadband

Internet service furnished over telephone lines,” as a

“telecommunications service.” See Verizon, 740 F.3d at 630–

31 (citing In re Deployment of Wireline Services Offering

Advanced Telecommunications Capability, 13 FCC Rcd.

24012, 24014 ¶ 3, 24029–30 ¶¶ 35–36 (1998) (“Advanced

Services Order”)). But, the Advanced Services Order specified

the last-mile transmission between the end user and the Internet

10

Service Provider is distinct from the “enhanced service” of

Internet access itself. “The first service is a

telecommunications service (e.g., the . . . transmission path),

and the second service is an information service, in this case

Internet access.” See Advanced Services Order 24030 ¶ 36.

In 2002, the FCC issued its Cable Broadband Order. The

Commission found that cable modem service “supports such

functions as email, newsgroups, maintenance of the user’s

world wide web presence, and the DNS. Accordingly . . . cable

modem service” is “an Internet access service,” making it “an

information service.” See Inquiry Concerning High-Speed

Access to the Internet Over Cable and Other Facilities; Internet

Over Cable Declaratory Ruling; Appropriate Regulatory

Treatment for Broadband Access to the Internet Over Cable

Facilities, FCC 02-77, 17 FCC Rcd. 4798, 4822 ¶ 38 (2002)

(“Cable Broadband Order”). This classification stood

irrespective of the fact that “cable modem service provides the

[enhanced service] capabilities described [] via

‘telecommunications.’” Id. 4823 ¶ 39. In the case of cable

modem service, “[t]he cable operator providing cable modem

service over its own facilities . . . is not offering

telecommunications service to the end user, but rather is merely

using telecommunications to provide end users with cable

modem service.” Id. 4823–24 ¶ 41. The distinction between

the services still stood, even as the nature of cable modem

service rendered it an integrated “information service.” This

confirms, again, what is of relevance here: the fact that an

“information service,” like Internet access, has

“telecommunications services” among its component parts

does not per se make it a “telecommunications service.” The

Cable Broadband Order was at issue in Brand X.

A.

11

Brand X

In Brand X, the Supreme Court left the FCC’s

“information service” classification of cable-provided Internet

access “unchallenged.” See 545 U.S. at 987–88. Brand X also

acknowledged, as FCC acknowledged in its prior Orders and

in its briefing before the Brand X Court, “information service .

. . [is] the analog to enhanced service” in the 1996 Act, and this

“information service” includes accessing the Internet. See 545

U.S. at 987; see also FCC Brand X Reply Br. 5, No. 04-277

(Mar. 18, 2005) (explaining Internet access allows the user to

“interact[] with stored data . . . maintained on the facilities of

the other ISP (namely the contents of . . . web pages, e-mail

boxes, etc.)”). When explaining why cable modem service was

an “information service,” the Brand X Court relied on cable

modem service “provid[ing] consumers with a comprehensive

capability for manipulating information using the Internet via

high-speed telecommunications”—namely, “enabling users,

for example, to browse the World Wide Web . . . . [to] match[]

the Web page addresses that end users type into their browsers

(or ‘click’ on) with the Internet Protocol (IP) addresses of the

servers containing the Web pages the users wish to access.” Id.

at 987. Even as cable modem service relied on

“telecommunications service” to bring this “information

service” to the end user, “the nature of the functions the end

user is offered” was Internet access, an information service—

rendering the classification proper. See id. at 988 (emphasis

added). The presumption here is, under the 1996 Act, Internet

access is information service.

Brand X cannot be read to render broadband Internet

access a “telecommunications service.” As the Supreme Court

said, “the entire question [in Brand X] is whether the products

here are functionally integrated or functionally separate.” Id.

at 991 (emphasis added). In other words, does the fact that

12

cable modem service delivers the “information service” of

Internet access through a “telecommunications service” render

the two services one “offer” of “information service?” Or, is

there one “offer” of “telecommunications service” in the

transmission and one “offer” of “information service” in the

Internet access? To channel Justice Scalia’s Brand X pizzeria

analogy, the Brand X majority found cable modem service a

single “offer” of “information service,” or a pizzeria’s single

“offer” of pizza and pizza delivery. Justice Scalia, in contrast,

thought cable modem service contained “offers” of

“telecommunications” and “information” services,

respectively, or separate “offers” of “pizza delivery” and

“pizza.” No member of the Brand X Court disputed that what

occurred at the Internet Service Providers’ computer-

processing facilities constituted an “information service.” See

545 U.S. at 997–1000; see also id. at 1009–11 (Scalia, J.,

dissenting). Or, continuing the analogy, no member of the

Brand X Court disputed that the pizzeria makes pizza. FCC

would confirm that nothing in Brand X rendered Internet access

itself a “telecommunications service.” See Appropriate

Framework for Broadband Access to the Internet Over

Wireline Facilities, et al., FCC 05-150, 20 FCC Rcd. 14853,

14862 ¶ 12 (2005) (“Internet access service is an information

service”).

B.

Reclassification and Verizon

The FCC repeatedly affirmed the Act’s deregulatory

approach toward mobile broadband Internet access as well. In

2007, the Commission said “mobile wireless broadband

Internet access service does not fit within the definition of

‘commercial mobile service’” because it is not an

“interconnected service”—it connects to the Internet and not

13

the telephone network. See Appropriate Regulatory Treatment

for Broadband Access to the Internet Over Wireless Networks,

FCC 07-30, 22 FCC Rcd. 5901, 5916 ¶ 41, 5917 (2007). 2 The

FCC reached the same conclusion in 2011. See Reexamination

of Roaming Obligations of Commercial Mobile Radio Service

Providers and Other Providers of Mobile Data Services, FCC

11-52, 26 FCC Rcd. 5411, 5431 ¶ 41 (2011). In doing so, the

Commission confirmed mobile broadband’s status as outside

common carrier classification.

This Court was equally consistent about the status of

mobile broadband Internet service. In Cellco Partnership v.

FCC, 700 F.3d 534 (D.C. Cir. 2012), this Court said Section

332 provides a “statutory exclusion of mobile-internet

providers from common carrier status.” See id. at 544. When

the FCC attempted to treat mobile broadband like a common

carrier in Verizon, this Court minced no words—the “treatment

of mobile broadband providers as common carriers would

violate section 332.” 740 F.3d at 650.

To be sure, this Court said in Verizon that, under Section

706 of the 1996 Act, the FCC “never disclaimed authority to

regulate the Internet or Internet providers altogether.” See id.

at 638. Whatever the wisdom of Verizon’s interpretation of

Section 706, the FCC did not “reclassify broadband” to

2

Importantly, one of the reasons the FCC saw no sense in classifying

mobile broadband as “commercial mobile service” is the “internal

contradiction within the statutory scheme” doing so would create

with the status of Internet access as an information service. See 22

FCC Rcd. at 5916 ¶ 41 (“Concluding that mobile wireless broadband

Internet access service . . . should not be . . . subject to . . . common

carrier obligations . . . is most consistent with Congressional intent

to maintain a regime in which information service providers are not

subject to Title II regulations as common carriers.”) (emphasis

added).

14

implement “net neutrality” principles in that case. See id. at

633. In fact, as Judge Williams noted in dissent from the

Court’s Opinion here, “the Verizon court struck down the rules

at issue on the ground that they imposed common carrier duties

on the broadband carriers, impermissibly so” under the Act.

See Concurring & Dissenting Op. 52 (emphasis in original);

see also Verizon, 740 F.3d at 650 (“[R]egulating broadband

providers as common carriers” would “obvious[ly] . . . violate

the Communications Act.”); see also id. at 656–59. Moreover,

Verizon did not require the FCC to reclassify broadband in the

future if the Commission wanted to implement any form of “net

neutrality.” Instead, Verizon identified FCC authority in

Section 706 to implement some “net neutrality” regulations

without reclassification (such as FCC’s “transparency rules,”

which the Verizon Court upheld). When crafting this Order,

the Commission took note of Verizon’s conclusions.

In announcing the Order here, the FCC Chairman claimed

the Order “proposed” to “reinstate rules that achieve the goals

of the 2010 Order using the Section 706-based roadmap laid

out by the court [in Verizon].” See Notice of Proposed

Rulemaking, FCC 14-61, 29 FCC Rcd. 5561, 5647 (2014)

(statement of Chairman Tom Wheeler). No statement from the

FCC—until after the President intervened, that is—ever

suggested the Commission felt compelled by Verizon to

reclassify broadband if it wanted to implement any “net

neutrality” principles. Indeed, when the Notice of Proposed

Rulemaking explained the contours of the Order’s ban on

commercially unreasonable practices, it stated the following as

FCC’s goal: “[C]odifying an enforceable rule to protect the

open Internet that is not common carriage per se.” See id. at

5599, Subpart III.E (capitalizations omitted) (emphasis added).

The Notice of Proposed Rulemaking made similar statements

with respect to its revisions to the “no-blocking” rule after

Verizon. See id. at 5595 ¶ 95.

15

Verizon found the FCC’s proper Section 706 authority

consistent with “the backdrop of the Commission’s long

[regulatory] history.” See 740 F.3d at 638. That “backdrop”

led Verizon to say: “Congress clearly contemplated that the

Commission would continue regulating Internet providers in

the manner it had previously.” Id. at 639. Before the

President’s intervention in this Order and in light of Verizon,

the Commission was going to do exactly that. But by

reclassifying broadband Internet access as common carriage,

“the circumstances” of this Order are “entirely different” from

what Verizon considered. See id. at 638.

III.

The Order Here Lacks Congressional Authorization

The Order at issue gives FCC the authority to regulate “all

users of public IP addresses,” or everything that connects to the

Internet. See In the Matter of Protecting and Promoting the

Open Internet (“Order”) ¶ 396 (Feb. 26, 2015). By 2020,

according to the FCC Chairman, this could amount to 50 billion

interconnected devices. See, e.g., Remarks of FCC Chairman

Tom Wheeler, International Institute of Communications

Annual Conference (Oct. 7, 2015), https://apps.fcc.gov/

edocs_public/attachmatch/DOC-335877A1.pdf. This vast

power comes from two different, but related statutory

reclassifications. First, the FCC reclassifies fixed broadband

Internet access from an “information service” under Title I of

the Act to a “telecommunications service” under Title II.

Second, the FCC reclassifies mobile broadband service as an

“interconnected service” with “the public switched network”

under Title III.

16

Both reclassifications ensure what the Court calls

“consistent regulatory treatment” of mobile and fixed

broadband Internet access. See Op. 77. By “consistent

regulatory treatment,” the Court means the FCC can treat

Internet access like monopolist railroads and telephone

services—as a common carrier subject to public utility

regulation. The innovation of modern technology now falls

prey to the regulatory labyrinth smothering the old.

Subjecting all broadband Internet access to common

carrier regulation lets FCC decide how to apply onerous

requirements on Internet access. This authority covers all the

ways in which Internet Service Providers conduct and run their

respective businesses. The Order gives the FCC authority to

determine, case-by-case, whether any activities “unreasonably

interfere with or unreasonably disadvantage the ability of

consumers to reach the Internet content, services, and

applications of their choosing.” Order ¶ 135. FCC is

empowered to assess the “reasonableness” of all rates, terms,

and practices of Internet Service Providers. See, e.g., id. ¶¶

441–52, 512, 522. The Order also includes an outright ban on

several practices, including: “throttling,” or slowing Internet

service down, id. ¶ 119; blocking access to certain Internet

content; and on individualized negotiation of Internet access

between content owners and Internet Service Providers (called

“paid prioritization”), id. ¶ 125. Some practices are explicitly

left for the FCC to address in the future, like not charging end

customers for the data used by certain applications or Internet

services (“zero rating”), and sponsored-data plans, id. ¶¶ 151–

53. In short, the Order establishes the FCC’s long-term

authority over Internet access.

The FCC’s unheralded assertion of power has already led

some smaller Internet Service Providers to “cut[] back on

investments [in broadband Internet access].” See Statement of

17

FCC Commissioner Ajit Pai On New Evidence That President

Obama’s Plan To Regulate The Internet Harms Small

Businesses And Rural Broadband Deployment (May 7, 2015),

http://go.usa.gov/3wAkn. I doubt they will be the last

Providers to lessen their investments in Internet access, or to

attempt navigating their business practices around FCC

regulation. The Court’s Opinion is blasé about grafting public

utility regulation on to an innovative enterprise. See Op. 97.

But, the conceit of regulatory capture is often fatal to growth,

leading regulation to fail at its own aims by operating on only

a pretense of knowledge. See F.A. Hayek, THE FATAL

CONCEIT: THE ERRORS OF SOCIALISM 76 (W.W. Bartley, III ed.

1991) (“The curious task of economics is to demonstrate to

men how little they really know about what they imagine they

can design.”).

Reclassifying broadband Internet access so as to subject it

to common carrier regulation upends the Act’s core distinction

between “information service” and “telecommunications

service,” and it rewrites the statutory prohibition on treating

mobile broadband providers as common carriers.

Distinguishing “enhanced service,” like Internet access, from

“basic services” subjected to public utility regulation is not

some trivial matter, nor is it resolved simply by whether

Congress authorized FCC to have some degree of regulatory

authority over the Internet. Drawing this distinction is “the

essential characteristic” of the 1996 Act. Cf. MCI Telecomms.

Corp., 512 U.S. at 231. “What we have here, in reality, is a

fundamental revision of the statute, changing it from a scheme

of” common carrier regulation for telecommunications

services, to common carrier regulation of information service

when that service merely has telecommunications services

among its component parts. Cf. id. “That may be a good idea,

but it was not the idea Congress enacted into law in 19[96].”

See id. at 232. Therein lies the problem.

18

A.

The Major Question Of Reclassification Requires Clear

Congressional Authority

One might be tempted to say turning Internet access into a

public utility is obviously a “major question” of deep economic

and political significance—any other conclusion would fail the

straight-face test. But, the Court exhibits no such qualms. See

Op. 37–38. Of course, the Opinion does not—and cannot—

dispute the FCC’s Order implicates a “major question.”

Indeed, the Court has already characterized “net neutrality”

regulation as a “major question,” even without the distinct

salience brought by implementing “net neutrality” through

reclassifying broadband Internet access. See Verizon, 740 F.3d

at 634 (“Before beginning our analysis, we think it important

to emphasize that . . . the question of net neutrality implicates

serious policy questions, which have engaged lawmakers,

regulators, businesses, and other members of the public for

years . . . . Regardless of how serious the problem an

administrative agency seeks to address, . . . it may not exercise

its authority in a manner that is inconsistent with the

administrative structure that Congress enacted into law.”). The

problem here is the Court’s analysis—it ignores the legal

consequences flowing from the “major question”

determination.

As Chief Justice John Marshall recognized long ago, there

is a difference between “those important subjects, which must

be entirely regulated by the legislature itself, from those of less

interest, in which a general provision may be made, and power

given to those who are to act under such general provisions to

fill up the details.” See Wayman v. Southard, 23 U.S. (10

Wheat.) 1, 43 (1825). Accordingly, the deference courts afford

19

to administrative agencies under Chevron, U.S.A., Inc. v.

Natural Resources Defense Council, Inc., 467 U.S. 837 (1984)

is “premised on the theory that a statute’s ambiguity constitutes

an implicit delegation from Congress to the agency to fill in the

statutory gaps.” FDA v. Brown & Williamson Tobacco Corp.,

529 U.S. 120, 159 (2000) (citing Chevron, 467 U.S. at 844);

see also La. Pub. Serv. Comm’n v. FCC, 476 U.S. 355, 374

(1986) (holding the FCC has “literally . . . no power to act . . .

unless and until Congress confers power upon it”). In other

words, the mere existence of “a statutory ambiguity,” see Op.

38, “is not enough per se to warrant deference to the agency’s

interpretation. The ambiguity must be such as to make it

appear that Congress either explicitly or implicitly delegated

authority to cure that ambiguity.” Am. Bar Ass’n v. Fed. Trade

Comm’n, 430 F.3d 457, 469 (D.C. Cir. 2005); see also Brown

& Williamson, 529 U.S. at 133 (requiring an agency to bear in

mind “the fundamental canon of statutory construction that the

words of a statute must be read in their context and with a view

to their place in the overall statutory scheme”).

An agency’s freedom to regulate on a matter via a statutory

ambiguity therefore turns on what Congress authorized—and

that latter determination is “shaped, at least in some measure,

by the nature of the question presented.” See id. at 125; see

also Am. Bar Ass’n, 430 F.3d at 469. Is the agency regulating

on a “major question” of deep economic and political

significance, or is it regulating on an interstitial matter? If

Congress is not going to leave “those important subjects” to

“itself,” but instead authorize an agency to regulate on them,

an implicit authorization is insufficient. “We expect Congress

to speak clearly if it wishes to assign to an agency decisions of

vast economic and political significance.” Util. Air Regulatory

Group v. EPA, 134 S. Ct. 2427, 2444 (2014) (UARG); King v.

Burwell, 135 S. Ct. 2480, 2488–89 (2015) (“[H]ad Congress

wished to assign that [extraordinary] question to an agency, it

20

surely would have done so expressly;” requiring the Court to

interpret the statute de novo for a clear statement of

congressional authorization); Brown & Williamson, 529 U.S.

at 160 (authorizing an agency to regulate on a matter of “such

economic and political significance” would not occur “in so

cryptic a fashion”); Whitman v. Am. Trucking Ass’n, 531 U.S.

457, 468 (2001) (“Congress . . . does not alter the fundamental

details of a regulatory scheme in vague terms or ancillary

provisions—it does not, one might say, hide elephants in

mouseholes.”); MCI Telecomms. Corp., 512 U.S. at 231 (“It is

highly unlikely that Congress would leave the determination of

whether an industry will be entirely, or even substantially, rate-

regulated to agency discretion—and even more unlikely that it

would achieve that through such a subtle device as permission

to ‘modify’ rate-filing requirements.”).

The Court fails to fairly engage this standard of review,

both overrating the role of the statutory ambiguity here and

underrating the application of the clear statement rule to major

questions. 3 After jumping right into Chevron’s two-step

deference analysis, the Court’s Opinion treats Brand X as the

3

Unfortunately, cavalier treatment of the clear statement

requirement for major questions is not unprecedented. When

Verizon admitted “net neutrality” implicated a major question, it

quoted Brown & Williamson’s standard of review (though, perhaps

to avoid facing the clear statement rule head on, Verizon chose to

quote a case quoting Brown & Williamson, not Brown & Williamson

itself). Compare Verizon, 740 F.3d at 634 (“Regardless of how

serious the problem an administrative agency seeks to address, . . . it

may not exercise its authority in a manner that is inconsistent with

the administrative structure that Congress enacted into law.”) with

Brown & Williamson, 529 U.S. at 125. But then, Verizon did not

apply the clear statement analysis, see 740 F.3d at 634, concluding

instead that the case “is a far cry” from Brown & Williamson, despite

its supporting quotation. See id. at 638.

21

coup de grace for any requirement of clear congressional

authorization. See Op. 32–38. Yes, Brand X did uphold the

FCC’s determination that the “offering” of

“telecommunications service” in Title II of the

Communications Act is ambiguous. See 545 U.S. at 986, 989.

But this “statutory ambiguity” does not allow the FCC to

reclassify broadband Internet access without any serious

judicial scrutiny. But see Op. 38.

The mere fact that a “statutory ambiguity” exists for some

purposes does not mean it authorizes the agency to reach major

questions—statutory context and the overall scheme must be

considered. See, e.g., UARG, 134 S. Ct. at 2441 (“[W]hile

Massachusetts rejected EPA’s categorical contention that

greenhouse gases could not be ‘air pollutants’ for any purposes

of the Act, it did not embrace EPA’s current, equally

categorical position that greenhouse gases must be air

pollutants for all purposes, regardless of the statutory context.”)

(emphasis in original); Whitman, 531 U.S. at 469 n.1 (“None

of the sections of the CAA in which the District of Columbia

Circuit has found authority for the EPA to consider costs shares

§ 109(b)(1)’s prominence in the overall statutory scheme.”).

When the statutory context and backdrop against which

Congress passed the 1996 Act are considered, as they were in

Brand X, the Supreme Court’s decision reinforces the need for

FCC to show a textual assignment of authority before it can

reclassify broadband Internet access as common carriage.

The Order posits—and the Court’s Opinion approves—an

untenable reading of Brand X: the pizzeria no longer offers

“pizza” or “pizza delivery,” it just offers “delivery.” In other

words, because the “information service” of retrieving

information from Internet websites includes

“telecommunications service,” every aspect of that

“information service” is now just a “telecommunications

22

service.” See, e.g., Order ¶ 195. The Court tries to wave off

this problem by quickly saying Brand X “focused on the nature

of the functions broadband providers offered to end users, not

the length of the transmission pathway” Op. 33. This is true,

but it does nothing to support the Court’s position. As the

history explained above reveals, “the nature of the functions

broadband providers offered to end users” was the focus of

Brand X because the Supreme Court did not challenge the fact

that “enabl[ing] users . . . to browse the World Wide Web” is

information service. See 545 U.S. at 987. In response, the

Court’s Opinion resorts to crying wolf—claiming a full reading

of Brand X would “freeze in place the Commission’s existing

classifications of various services,” which neither Congress nor

Brand X intended. See Op. 35. But this misses the point. Yes,

Brand X found the “offering” of “telecommunications service”

ambiguous. And yes, Brand X allows FCC to assess the

“factual particulars” of changed broadband technology. See

545 U.S. at 991. But, nothing in Brand X renders the statutory

term “information service” indistinguishable from

“telecommunications service.” Computer processing at ISP

facilities remains an “enhanced service” exempt from common

carrier status under the statute. See 47 U.S.C. §§ 230(f)(2),

231(e)(4).

By incorporating FCC’s distinction between “enhanced

service” and “basic service” into the statutory scheme, and by

placing Internet access on the “enhanced service” side,

Congress prohibited the FCC from construing the “offering” of

“telecommunications service” to be the “information service”

of Internet access. See Universal Service Report ¶ 39 (“After

careful consideration of the statutory language and legislative

history, we affirm our prior findings that telecommunications

service and information service in the 1996 Act are mutually

exclusive.”) (emphasis added); see also Sekhar v. United

States, 133 S. Ct. 2720, 2724 (2013) (“[I]f a word is obviously

23

transplanted from another legal source . . . it brings the old soil

with it.”); see also Brown v. Gardner, 513 U.S. 115, 118 (1994)

(“Ambiguity is a creature not of definitional possibilities but of

statutory context.”); cf. Brown & Williamson, 529 U.S. at 144

(“In adopting each statute, Congress has acted against the

backdrop of FDA’s consistent and repeated statements that it

lacked authority under the FDCA to regulate tobacco . . . .”).

The issue therefore, is not whether FCC can assess

technological changes to Internet access, or whether FCC has

discretion to reasonably construe the “offer” of

“telecommunications service” by considering that transmission

part of the “information service” it transmits, or considering the

transmission itself an “offer” of “telecommunications service”

separate from the “information service” it transmits. Rather,

the issue is whether FCC can use this discretion to transgress

congressional distinctions and definitions—such as the

distinction drawn between “Internet access service” and

“telecommunications services,” see 47 U.S.C. § 231(e)(4), or

the definition of “interactive computer services,” which

“means any information service . . . including specifically a

service or system that provides access to the Internet,” id. §

230(f)(2) (emphasis added). Nothing, not even Chevron

deference, makes “a statutory ambiguity,” see Op. 38, a tool to

override congressional standards.

Congress has declined to authorize “net neutrality”

legislation of any kind, let alone revisit its classification of

Internet access as outside the realm of common carrier

regulation. The FCC’s historic practice, taken together with

Congress’s refusal to cede this authority, obligates us “to defer

not to the agency’s expansive construction of the statute, but to

Congress’[s] consistent judgment.” See Brown & Williamson,

529 U.S. at 160.

B.

24

No Clear Congressional Authority To Reclassify

“Since an agency’s interpretation of a statute is not entitled

to deference when it goes beyond the meaning that the statute

can bear, the Commission’s . . . policy can be justified only if

it makes a less than radical or fundamental change in the Act .

. . . The Commission’s attempt to establish that no more than

that is involved greatly understates the extent to which its

policy deviates from the [Act’s] requirement[s], and greatly

undervalues the importance of the [Act’s] requirement[s].”

MCI Telecomms. Corp., 512 U.S. at 229; see also UARG, 134

S. Ct. at 2442 (“Thus, an agency interpretation that is

inconsisten[t] with the design and structure of the statute as a

whole . . . does not merit deference.”).

Perhaps this explains why the Court’s Opinion foregoes a

statutory analysis. On issue after issue, the Court puts agency

ipse dixit where reasoned analysis should be:

First, as to the 1996 Act’s policy statements, the Court

simply parrots the Commission’s speculation that it is “unlikely

[] Congress would attempt to settle the regulatory status of

broadband Internet access services in such an oblique and

indirect manner, especially given the opportunity to do so when

it adopted the Telecommunications Act of 1996.” See Op. 34–

35. But the clear statement rule requires reading the statute,

not nodding along with the agency. Broadband Internet access

may be more sophisticated than Internet access from the 1990s,

but this does not change the nature of broadband Internet

access. Cf. Brand X, 545 U.S. at 992 (“In any event, we doubt

that a statute that, for example, subjected offerors of ‘delivery’

service (such as Federal Express and United Parcel Service) to

common-carrier regulation would unambiguously require

pizza-delivery companies to offer their delivery services on a

25

common carrier basis [too].”). 4 The Act’s policy statements

are fulfilled in specific statutory provisions, but the Court’s

Opinion ignores them.

Second, the Court’s Opinion makes mincemeat of Verizon

and sends the Universal Service Report silently into the night.

The Order here claims the Universal Service Report was “not

a binding Commission order.” Order ¶ 315. This is as

inexplicable as it is unexplained. The Order provides no

principled reason why the Universal Service Report—a report

of FCC Commissioners to Congress—should be dismissed, nor

why the FCC’s repeated citation to the Universal Service

Report in prior Orders should be ignored. The Court is silent

on this issue, and its assessment of Verizon is revisionist

history. It claims FCC “did not believe” Verizon left it with

any choice but to reclassify broadband Internet access as a

“telecommunications service” if it wished to implement “net

neutrality” principles. See Op. 43. But as Verizon’s upholding

of FCC’s transparency rules, the statements from FCC

Chairman Wheeler, and this Order’s Notice of Proposed

Rulemaking together confirm, this is false. The FCC identified

a path to implement some “net neutrality” regulation without

reclassification. The Court just ignores it.

4

Nor, incidentally, does the Act’s exclusion from “information

service” those services that are “the management, control, or

operation of a telecommunications system or the management of a

telecommunications [purpose]” provide the Court or the

Commission any assistance. See 47 U.S.C. § 153(24). A contrary

conclusion would mean that Congress in 1996 considered Internet

access, and all its computer-processing functions, a “basic service,”

able to be provided by the Bell System companies. There is no

evidence of that in the Act, FCC’s longstanding practice, or in Brand

X.

26

Third, the Court nonsensically permits mobile

broadband’s reclassification by embracing the Order’s

redefinition of “the public switched network.” The Court’s

Opinion, like the Order, redefines “the public switched

network” to “encompass devices using both IP addresses and

telephone numbers.” See Op. 66. Since mobile broadband

Internet access allows users to access Voice-over-Internet-

Protocol (“VoIP”) applications (such as Skype), the Court

concludes mobile broadband “gives subscribers the capability

to communicate to telephone users.” See id. at 67. But the

backdrop against which Congress enacted the 1996 Act

confirms the FCC never defined “the public switched network”

to mean anything other or beyond the telephone network, and

certainly not public IP addresses. 5 Indeed, Congress itself

distinguished “the public switched network” and the Internet.

When Congress passed the Spectrum Act of 2012, it

distinguished “connectivity” to “the public Internet” from

“connectivity” to “the public switched network.” See 47

U.S.C. § 1422(b)(1). This subsequent, specific distinction can

5

Time and again leading up to the Telecommunications Act of 1996,

the FCC equated “the public switched network” with the telephone

network. This was the case in 1981. See Applications of Winter Park

Tel. Co., Mem. Op. and Order, 84 FCC 2d 689, 690 ¶ 2 n.3 (1981).

This Court said the same in 1982. See Ad Hoc Telecomms. Users

Comm. v. FCC, 680 F.2d 790, 793 (D.C. Cir. 1982). This equation

provided a key premise to the FCC’s cell service policy in 1992. See

Amendment of Part 22 of the Commission’s Rules Relating to

License Renewals in the Domestic Public Cellular Radio

Telecommunications Service, FCC 91-400, 7 FCC Rcd. 719, 720 ¶

9 (1992). Indeed, the calls to expand “the public switched network”

to include the “network of networks,” cited in the current Order,

were rejected by FCC in 1994. Compare Implementation of Sections

3(n) and 332 of the Communications Act; Regulatory Treatment of

Mobile Services, FCC 94-31, 9 FCC Rcd. 1411, 1433–34 ¶ 53, 1436–

37 ¶ 59 (1994) with Order ¶ 396 n. 1145.

27

inform what “the public switched network” meant to Congress

in 1996. See Brown & Williamson, 529 U.S. at 133 (“[T]he

meaning of one statute may be affected by other Acts,

particularly where Congress has spoken subsequently and more

specifically to the topic at hand.”). The Court has no basis to

claim it is “counter-textual” to equate “the public switched

network” with “the public switched telephone network.” See

Op. 65 (emphasis omitted). Not even the Court can claim VoIP

services make mobile broadband and the telephone network a

single network. See id. at 67 (“[T]he VoIP service sends the

call from her tablet’s IP address over the mobile broadband

network to connect to the telephone network and, ultimately, to

her friend’s home phone.”) (emphasis added). Nothing about

the increase of consumers accessing mobile broadband Internet

service via smart phones, see id. at 68–69, the speed of Internet

connection, id. at 69, or the “bundling” of VoIP applications

with smart phones, id. at 69–70, undermines the FCC’s 2007

distinction between the transmission of VoIP traffic and the

VoIP service to the end user. Mobile broadband Internet access

simply does not constitute a service interconnected with “the

public switched network.”

Fourth, the Court lets FCC get away with satisfying none

of the statutory requirements to forbear common carriage

regulation. The judiciary should take care to ensure the

Commission rigorously applies these standards in accordance

with the 1996 Act’s overall scheme. Even as forbearance is

designed to further freedom in the 1996 Act, giving an agency

power to eviscerate statutory requirements is “astonishing even

by administrative standards.” See Phillip Hamburger, IS

ADMINISTRATIVE LAW UNLAWFUL? 121 (2014). Under our

Constitution, “[t]here is no provision . . . that authorizes the

President [or any executive agency] to enact, to amend, or to

28

repeal statutes.” Clinton v. City of New York, 524 U.S. 417,

438 (1998). 6

“[T]he power to enact statutes may only be exercised in

accord with a single, finely wrought and exhaustively

considered, procedure.” Id. at 439–440. This power is

intrinsically legislative; it cannot be delegated away from the

legislature. When Congress has delegated authority allowing

the “suspension” or “repeal” of statutory provisions, “Congress

itself made the decision to suspend or repeal the particular

6

The FCC’s rulemaking here may “take [a] ‘legislative’ . . . form[],

but [it] [is] [an] exercise[] of—indeed under our constitutional

structure [it] must be [an] exercise[] of—the ‘executive Power.’” See

City of Arlington v. FCC, 133 S. Ct. 1863, 1873 n.4 (2013) (emphasis

in original); FCC v. Fox TV Stations, Inc., 556 U.S. 502, 524–25

(2009) (“In [Justice Stevens’] judgment, the FCC is better viewed as

an agent of Congress than as part of the Executive. . . . Leaving aside

the unconstitutionality of a scheme giving the power to enforce laws

to agents of Congress, it seems to us that Justice [Stevens’]

conclusion does not follow from his premise.”) (emphasis added);

see also 47 U.S.C. § 151 (creating the FCC to “execute and enforce

the provisions of this [Act]”). Moreover, there is an argument that,

though a nominally independent agency, the FCC, as a general

matter, should be treated like an executive agency because Congress

never created a for-cause removal statute prohibiting “the President

[from] supervis[ing], direct[ing], and remov[ing] at will the” FCC

Commissioners. See PHH Corp. v. Consumer Fin. Prot. Bureau, 839

F.3d 1, 18 n.4 (D.C. Cir. 2016). “We need not tackle that question

in this case,” however, id., because the rulemaking exercised here

facilitates a change in the execution and enforcement of the Act—

this must be executive Power, see City of Arlington, 133 S. Ct. at

1873 n.4; Fox TV Stations, 556 U.S. at 525 (“The Administrative

Procedure Act, after all, does not apply to Congress and its agencies,”

only to executive agency action).

29

provisions at issue upon the occurrence of particular events

subsequent to enactment, and it left only the determination of

whether such events occurred up to the President,” or in this

case, the FCC. See id. at 445 (emphasis added). In other

words, only Congress may alter statutory standards—an

agency or the President is left simply to make factual findings

about whether those legal standards should apply.

Yet, as Judge Williams noted in his opinion here, “the

Commission’s massive forbearance [came] without findings

that the forbearance is justified” under the statute’s conditions.

See Concurring & Dissenting Op. 62; see also id. at 62–69.

Both the FCC and the Court found reclassifying Internet access

as a “telecommunications service,” coupled with forbearance,

would be within FCC’s power even without a change in the

underlying factual circumstances of Internet access. See Order

¶ 360 n.993; Op. 47. In other words, the Court concludes the

FCC’s forbearance need not have anything to do with factual

findings—the Commission is free to rewrite statutory terms as

it sees fit. Used in this way, forbearance usurps the

exclusively-legislative function of lawmaking because, “[i]n

both legal and practical effect, the [FCC] has amended [an]

Act[] of Congress by repealing [or amending] a portion.” See

Clinton, 524 U.S. at 438; see also UARG, 134 S. Ct. at 2446

n.8 (I am “aware of no principle of administrative law that

would allow an agency to rewrite such [] clear statutory

term[s], and [I] shudder to contemplate the effect that such a

principle w[ill] have on democratic governance”).

Troubling as the failure to follow the Act’s requirements

is, that is not the FCC’s only abuse. It also used forbearance to

pervert the Act’s requirements.

C.

30

Perversion Of Forbearance Authority

FCC’s use of its forbearance authority confirms this Order

is “an enormous and transformative expansion [of its]

regulatory authority without clear congressional authorization”

and, thus, “unreasonable.” UARG, 134 S. Ct. at 2444 n.8. By

the FCC Chairman’s own admission, the Act’s common carrier

regulations do not contemplate broadband Internet access. So,

the Order cannot merely reclassify broadband Internet access,

it must also “modernize Title II, tailoring it for the 21st

century.” Tom Wheeler, FCC Chairman Tom Wheeler: This is

How We Will Ensure Net Neutrality, WIRED (Feb. 4, 2015,

11:00 AM), https://www.wired.com/2015/02/fcc-chairman-

wheeler-net-neutrality/. As the Chairman conceded, this

required “taking the legal construct that once was used for

phone companies and pairing it back to modernize it.” FCC

Proposes Treating All Internet Traffic Equally, PBS

NEWSHOUR (PBS television broadcast Feb. 4, 2015, 6:35 PM),

http://www.pbs.org/newshour/bb/fcc-proposes-treating-all-

internet-traffic-equally.

The Order acknowledges its tailoring of the Act’s

common carrier requirements so as to capture broadband

Internet access is “extensive,” “broad,” “[a]typical,” and

“expansive”—including at least 30 Title II provisions and 700

rules promulgated under them. See Order ¶¶ 37, 51, 438, 461,

493, 508, 512, 514. The Order also says this level of

forbearance results in a modernization of Title II “never”

before contemplated. See id. ¶¶ 37, 38. The Court’s Opinion

and the Order disregard the nature of forbearance.

Forbearance permits the FCC to reduce common carriage

regulation over telecommunications, not expand common

carriage regulation by reclassifying an information service and

shaping common carriage regulations around it. The FCC has

31

consistently understood this, invoking forbearance toward one

of “Congress’s primary aims in the 1996 Act:” “deregulate

telecommunications markets to the extent possible.” See, e.g.,

Memorandum Op. & Order, Petition of Qwest Corp. for

Forbearance Pursuant to 47 U.S.C. § 160(c) in the Omaha

Metro. Statistical Area, 20 FCC Rcd. 19415, 19454 (2005); see

also Petition of ACS of Anchorage, Inc. Pursuant to Section 10

of the Commc’ns Act of 1934, as Amended, for Forbearance

from Sections 251(c)(3) & 252(d)(1) in the Anchorage Study

Area, 22 FCC Rcd. 1958, 1969 ¶ 16 (2007) (referring to the

“deregulatory aims” of FCC’s statutory forbearance authority).

The Court, however, makes an argument foreign to the 1996

Act. The Opinion claims “the rapid deployment of new

telecommunications technologies” “might occasion the

promulgation of additional regulation.” Op. 97. Congress,

however, clearly did not consider the 1996 Act’s goals—

promoting competition and reducing regulation—in tension

with “the rapid deployment of new telecommunications

technologies.” Rather, the Act’s obvious reading is that more

competition and lower regulation would lead to increased

deployment of new telecommunications technologies. The

ensuing history of Internet innovation vindicated Congress’s

policy choice. Understanding the expansion of common carrier

regulation as an affirmative good, as the Court seems to do, is

foreign to the Act.

There is a sad irony here. Both this Court and the

Supreme Court admonished the FCC for asserting forbearance

authority without congressional authorization when the

Commission’s aim was deregulatory. Now, when the

Commission’s aim is to increase regulation, this Court is

willing to bless the Commission using forbearance without any

satisfaction of the statutory requirements, and at odds with the

nature of forbearance itself.

32

UARG cited generally-applicable tenets of administrative

law and the separation of powers—not some Clean Air Act

novelty—when it said “[a]n agency has no power to ‘tailor’

legislation to bureaucratic policy goals by rewriting

unambiguous statutory terms.” 134 S. Ct. at 2445. The Court

blithely ignores its “severe blow to the Constitution’s

separation of powers” by reading the FCC’s forbearance

authority to expand, rather than lessen, common carrier

regulation at the legislature’s expense. See id. at 2446. The

Court provides no answer to the problems of public

accountability and individual liberty with its mere assertion of

forbearance being a “statutory mandate.” Compare Op. 41 with

Clinton, 524 U.S. at 451–52 (Kennedy, J., concurring). If the

FCC is to possess statutory forbearance authority, it should

conform to forbearance’s statutory conditions and the overall

statutory scheme. Neither is the case here. The FCC’s abuse

of forbearance amounts to rewriting the 1996 Act in the bowels

of the administrative state, when it should petition Congress for

these purportedly-necessary changes.

IV.

Presidential Interference

When all the statutory somersaults, revisionist history, and

judicial abdication are done, we are still left with a lingering

question: Why, on the verge of announcing a new Open

Internet Order in 2014 that both implemented “net neutrality”

principles and preserved broadband Internet access as an

“information service,” would the FCC instead reclassify

broadband Internet access as a public utility? Simple.

President Obama pressured the FCC to do it. This Court once

held “an agency may not repudiate precedent simply to

conform with a shifting political mood.” Nat’l Black Media

33

Coal. v. FCC, 775 F.2d 342, 356 n.17 (D.C. Cir. 1985). Alas,

here we see the exception that kills the rule.

The FCC released its Notice of Proposed Rulemaking in

May of 2014—where it was clear that broadband Internet

would not be reclassified for common carrier regulation.

Afterward, “an unusual, secretive effort” began “inside the

White House” with activists interested in getting the FCC to

change its position. See G. Nagesh & B. Mullins, Net

Neutrality: How White House Thwarted FCC Chief, WALL ST.

J. (Feb. 4, 2015). White House staffers were directed “not to

discuss the process openly.” Id. One can see why—the FCC

is, after all, supposed to be independent from Presidential

control. See, e.g., Humphrey’s Ex’r v. United States, 295 U.S.

602, 624–26 (1935).

In addition to the White House’s private meetings, the

President issued an online video (from China, without any

irony) urging the subjugation of broadband Internet access to

common carrier regulation. See G. Nagesh & B. Mullins, Net

Neutrality: How White House Thwarted FCC Chief, WALL ST.

J. (Feb. 4, 2015); see also The President’s Message On Net

Neutrality (Nov. 10, 2014), https://www.whitehouse.gov/net-

neutrality (“To put these protections in place, I am asking the

FCC to reclassify Internet service under Title II of a law known

as the Telecommunications Act.”). In the President’s written

statement, he said this reclassification should be facilitated by

“at the same time forbearing from rate regulation and other

provisions less relevant to broadband services.” Id.

The President’s statements “stunned officials at the FCC;”

“the statement[s] boxed in [the FCC Chairman] by giving the

FCC’s two other Democratic commissioners cover to vote

against anything falling short of [the President’s] position.” G.

Nagesh & B. Mullins, Net Neutrality: How White House

34

Thwarted FCC Chief, WALL ST. J. (Feb. 4, 2015). Moreover,

President Obama’s statements were issued “outside of the

window that the FCC had set for public comments,” but the

FCC accepted them anyway. See Kathryn A. Watts,

Controlling Presidential Control, 114 MICH. L. REV. 683, 741

(2016); see also The Path To A Free And Open Internet,

https://www.whitehouse.gov/net-neutrality (identifying in a

timeline that “[t]he FCC’s comment period c[ame] to a close”

on September 15, 2014, but “President Obama call[ed] on the

FCC to take up the strongest possible rules to protect net

neutrality” on November 10, 2014).

The President’s efforts “essentially killed the

compromise” of “net neutrality” without reclassification. G.

Nagesh & B. Mullins, Net Neutrality: How White House

Thwarted FCC Chief, WALL ST. J. (Feb. 4, 2015). The FCC

Chairman promptly delayed release of the new Order to

consider the President’s position. See FCC Chairman Tom

Wheeler’s Statement on President Barack Obama’s Statement

Regarding Open Internet (Nov. 10, 2014),

https://apps.fcc.gov/edocs_public/attachmatch/DOC-

330414A1.pdf. “On February 26, 2015, the FCC voted 3-2

along party lines to regulate broadband Internet service as a

public utility under Title II of the Communications Act, thus

voting for net neutrality rules aligned with [President] Obama’s

own plan.” Watts, Controlling Presidential Control, 114

MICH. L. REV. at 741.

There is a wide spectrum of agreement that the President’s

intervention into the FCC’s deliberations was, with respect to

broadband’s reclassification, outcome determinative. This

spectrum includes a former Special Assistant to President

Obama and current “net neutrality” advocate. See Susan

Crawford, A Tale of Two Commissioners, BACKCHANNEL

(May 26, 2015), https://backchannel.com/how-the-fcc-found-

35

its-backbone-960331bfac95#.s1rj231ui (“[T]he FCC, although

an independent agency, can read the President’s speeches like

everyone else, sense the change in the wind, and act

accordingly.”). It includes a dissenting FCC Commissioner.

See Order (dissenting statement of Commissioner Ajit Pai)

(“So why is the FCC changing course? Why is the FCC turning

its back on Internet freedom? Is it because we now have

evidence that the Internet is not open? No. Is it because we

have discovered some problem with our prior interpretation of

the law? No. We are flip-flopping for one reason and one

reason alone. President Obama told us to do so.”). It includes

a Report from the Majority Staff of the Senate Committee on

Homeland Security and Governmental Affairs, which

investigated the White House’s involvement in the FCC’s

deliberations. See Majority Staff Report, Committee on

Homeland Security and Governmental Affairs (Ron Johnson,

Chairman), Regulating The Internet: How The White House

Bowled Over FCC Independence, *2 (Feb. 29, 2016)

http://www.hsgac.senate.gov/download/regulating-the-

internet-how-the-white-house-bowled-over-fcc-independence

(citing internal FCC correspondence to conclude, the

“influence [of President Obama] was disproportionate relative

to the comments of members of the public,” and that his

involvement created a “pause” within the FCC’s deliberations

so to build a legal argument for reclassification). It also

includes law professors ultimately sympathetic with the

President’s intervention. See, e.g., Watts, Controlling

Presidential Control, 114 MICH. L. REV. at 719 (“Pai is clearly

correct that President Obama played a key causal role in the

FCC’s shift in its approach and ultimate decision to reclassify

broadband.”).

Despite President Obama’s “key causal role” behind the

FCC’s reclassification flip, his involvement goes virtually

unmentioned in the Order. In the course of the Order’s

36

hundreds of pages and more than a thousand footnotes, there

is one, indirect, reference to President Obama’s advocacy,

buried in the middle of a footnote. See Order ¶ 416 n. 1223

(quoting a letter asking whether “the President’s push for Title

II reclassification would affect” a company’s broadband

investments). Despite the FCC’s dearth of reference to the

President’s involvement, two footnotes within the Order

contain citations to sources characterizing the approach the

FCC would ultimately take toward “net neutrality” as President

Obama’s “plan.” See Order ¶ 40 n. 35, ¶ 416 n. 1220.

The President’s conduct—and the involvement of White

House staff more generally—raise questions about the form

and substance of executive Power. Unfortunately, none of

these questions were addressed by the Court. Given the

salience of these questions to our Constitution’s separation of

powers, this Court owed the American people a legal analysis,

not silent obedience.

A.

A Double Standard

The questions of form raised by the President’s

involvement concern the rulemaking procedures designed to

ensure public accountability—namely, the FCC’s regulations

on ex parte communications and adherence to notice and

comment requirements. To be sure, rulemaking is not a

“rarified technocratic process, unaffected by political

considerations or the presence of Presidential power.” Sierra

Club v. Costle, 657 F.2d 298, 408 (D.C. Cir. 1981). And, as

we have held, “the need for disclosing ex parte conversations

in some settings do[es] not require that courts know the details

of every White House contact . . . .” See id. at 407. The FCC,

37

however, has its own rules regarding ex parte contacts, and the

White House would be aware of them.

The Order’s Notice of Proposed Rulemaking referred to

and detailed some of the FCC’s ex parte requirements. See

Notice of Proposed Rulemaking 5624–25 ¶ 181 (citing, inter

alia, FCC’s ex parte rules, at 47 C.F.R. §§ 1.1200 et seq.). FCC

Chairman Wheeler said the Commission would “incorporate

the President’s submission into the record of the Open Internet

Proceeding,” FCC Chairman Tom Wheeler’s Statement on

President Barack Obama’s Statement Regarding Open

Internet (Nov. 10, 2014),

https://apps.fcc.gov/edocs_public/attachmatch/DOC-

330414A1.pdf. But, neither the Chairman’s statement nor the

Order explain why the President was allowed to make his

submission after the comment period expired. See Watts,

Controlling Presidential Control, 114 MICH. L. REV. at 741.

Nor does the Commission ever explain why further public

comment was not solicited after the President intervened—

despite the Chairman stating he welcomed further comment.

The Order’s record does not establish whether the

communications between White House staffers and the FCC

satisfied the Commission’s regulations on ex parte

communications (or why these communications were exempt

from these rules). See Majority Staff Report, Committee on

Homeland Security and Governmental Affairs (Ron Johnson,

Chairman), Regulating The Internet: How The White House

Bowled Over FCC Independence, *25 (Feb. 29, 2016)

http://www.hsgac.senate.gov/download/regulating-the-

internet-how-the-white-house-bowled-over-fcc-independence

(“The documents reviewed by the Committee make clear that

Chairman Wheeler regularly communicated with presidential

advisors. None of the communications reviewed by the

Committee were submitted to the FCC’s formal record in the

form of ex parte notices although the [Open Internet] Order

38

was clearly discussed.”). The White House had reason to know

of its obligations under the FCC’s ex parte rules. See, e.g.,

Memorandum from Deputy Assistant Attorney Gen. John O.

McGinnis to the Deputy Counsel to President George H. W.

Bush, 15 Op. O.L.C. 1, 1 (Jan. 14, 1991) (assessing the

propriety of ex parte communications between White House

officials and the FCC, concluding that “communications by the

White House must be disclosed in the FCC rulemaking record

if they are of substantial significance and clearly intended to

affect the ultimate decision”) (emphasis added). In short, the

Order and its administrative record leave us with many

questions about the involvement of the President and his

staff—questions made significant by us knowing enough to

know that the President’s involvement was outcome

determinative.

Perhaps the involved parties thought the President’s public

advocacy of “net neutrality” through reclassifying broadband

Internet access provided sufficient accountability; excusing the

White House from following the FCC’s rules. Perhaps the

FCC paid no mind to the matter because of the many filed

comments endorsing some form of “net neutrality” regulation

during the comment period. Whatever the thinking, this course

“effectively created two very different proceedings: First there

was the FCC’s conventional notice-and-comment proceeding

replete with its formalized procedures and deadlines regarding

the submission of comments and ex parte contacts. Next

emerged a different, more real-world proceeding,” the one

where the President provided outcome-determinative

influence. See Watts, Controlling Presidential Control, 114

MICH. L. REV. at 741. This “leav[es] the notice-and-comment

proceeding and the political proceeding disconnected from one

another and mak[es] the notice-and-comment process look like

no more than a smokescreen.” See id. Rules are only for

Americans who lack friends in high places.

39

To be clear, I am not suggesting the President has no

legitimate means of interjecting himself into an agency’s

rulemaking process. Nor am I suggesting that the President

should not bring an independent agency’s executive actions

within the Executive Branch. See Free Enter. Fund. v. Pub.

Co. Accounting Oversight Bd., 561 U.S. 477, 499 (2010) (“One

can have a government that functions without being ruled by

functionaries, and a government that benefits from expertise

without being ruled by experts. Our Constitution was adopted

to enable the people to govern themselves, through their elected

leaders. The growth of the Executive Branch, which now

wields vast power and touches almost every aspect of daily life,

heightens the concern that it may slip from the Executive’s

control, and thus from that of the people.”). Rather, my

assertion follows from the nature of executive Power.

Executive Branch authority over the execution and

enforcement of existing law is, in part, meant to ensure our

government’s republican form—thereby remaining publicly

accountable. Some Presidents, in the name of shaping an

agency’s direction, “might accept a novel practice that violates

Article II,” but “‘the separation of powers does not depend on

the views of individual Presidents . . . .’” PHH Corp., 839 F.3d

at 35 (quoting Free Enterprise Fund, 561 U.S. at 497). The

Constitution’s structural features are, themselves, legal

procedures designed to safeguard liberty by preserving public

accountability against the current moment’s political priorities.

A President may attempt to shape an agency’s deliberations so

as to vindicate the Constitution’s structural allocation of power;

ensuring the exercise of executive Power is consistent with the

publicly-accountable executive. See, e.g., Costle, 657 F.2d at

405 (“The executive power under our Constitution, after all, is

not shared[;] it rests exclusively with the President. . . . [T]he

Founders chose to risk the potential for tyranny inherent in

40

placing power in one person, in order to gain the advantages of

accountability fixed on a single source.”). But if the means by

which the President seeks to shape the agency’s deliberations

transgress legal procedures designed to ensure public

accountability—like notice-and-comment requirements and

rules regarding ex parte communications—he undermines the

accountability rationale for confining executive Power to the

President. Cf. Elena Kagan, Presidential Administration, 114

HARV. L. REV. 2245, 2332 (2001) (characterizing “the degree

to which the public can understand the sources and levers of

bureaucratic action” as a “fundamental precondition of

accountability in administration”). Acting with concern for

public accountability seems especially salient when the

President “and his White House staff” seek to exert influence

over the direction of an ostensibly-independent agency. Cf.

Costle, 657 F.2d at 405–06 (“In the particular case of EPA,

Presidential authority is clear since it has never been

considered an ‘independent agency,’ but always part of the

Executive Branch.”). Perchance something else explains the

White House’s conduct here than attempting to confine the

exercise of executive Power to the President. But, rather than

acknowledge the double standard the President’s involvement

created between the American People and their Chief

Executive, the FCC opted for the silent treatment. This Court

has no such luxury. “[S]ome might think that judges should

simply defer to the elected branches’ design of the

administrative state. But that hands-off attitude would flout a

long, long line of Supreme Court precedent.” PHH Corp., 839

F.3d at 35. Unfortunately, under this Court’s Opinion, the

American People will never know quite how the government

came to regulate their Internet access so pervasively.

B.

41

Reclassification Is Not A “Faithful” Execution Of Existing

Law

The questions of substance regarding the President’s

involvement here go to the core of our Constitution’s

separation of executive and legislative Power.

The nature of executive Power differs depending upon

whether the President is executing law, or seeking a change in

existing law. In the former context, the President is required

to “faithfully” execute the law. See U.S. CONST. Art. II, § 3, cl.

5; 7 see also Robert G. Natelson, The Original Meaning of the

Constitution’s “Executive Vesting Clause,” 31 WHITT. L. REV.

1, 14 & n.59 (2009) (discussing Article II’s Take Care Clause

as a “power-conferring” text historically “reminiscent” of

“royal instructions” to act as an agent). “In the framework of

our Constitution, the President’s power to see that the laws are

faithfully executed refutes the idea that he is to be a lawmaker.”

Youngstown Sheet & Tube Co. v. Sawyer, 343 U.S. 579, 587

(1952); United States v. Midwest Oil Co., 236 U.S. 459, 505

(1915) (“The Constitution does not confer upon [the President]

any power to enact laws or to suspend or repeal such as the

Congress enacts.”). The lawmaking power belongs exclusively

to Congress, not to agencies. See City of Arlington, 133 S. Ct.

at 1873 n.4. When the President petitions Congress to change

the law, however, he, necessarily, need not advocate a position

“faithful” to existing law. See U.S. CONST. Art. II, § 3, cl. 2

7

The President’s obligation under the Take Care Clause does not

extend to laws the President considers unconstitutional, nor does it

prohibit prosecutorial discretion. But, otherwise, “the Executive has

to follow and comply with laws regulating the executive branch.”

See Brett M. Kavanaugh, Our Anchor for 225 Years and Counting:

The Enduring Significance of the Precise Text of the Constitution, 89

NOTRE DAME L. REV. 1907, 1911 (2014).

42

(authorizing the President to “recommend such measures as he

shall judge necessary and expedient”).

To be sure, the creation of agency rules can muddle these

distinct aspects of executive Power. “Because most regulatory

statutes have multiple goals and are not written with crystal

clarity, the agency often has considerable interpretational

leeway before it steps over the statutory line, and the President

may attempt to push the agency as close to that line as

possible.” Thomas O. McGarity, Presidential Control of

Regulatory Agency Decisionmaking, 36 AM. U.L. REV. 443,

454 (1987). Our Constitution ensures that the line remains,

however. Cf. THE FEDERALIST NO. 73 (Hamilton), p. 441

(Clinton Rossiter ed., 1961) (adhering to the separation of

powers avoids “the legislative and executive powers . . .

com[ing] to be blended in the same hands”). “An activist

President with control over the rulemaking process could use

his power to press agencies beyond statutory limits that he was

unable to persuade Congress to remove. Such a President

would be guilty of unfaithful execution of the laws.”

McGarity, Presidential Control of Regulatory Agency

Decisionmaking, 36 AM. U.L. REV. at 455. A “related

problem” “occurs when members of the President’s staff

attempt to implement their own policy agendas in the name of

the President.” See id. Given the outcome-determinative

nature of the President’s involvement on the reclassification of

broadband Internet access—and the clarity with which

Congress set forth its deregulatory policy and standards in the

1996 Act—the question of how the President upheld his Take

Care Clause obligation in urging the FCC to reclassify Internet

access arises.

Here, the President did not ask the FCC to enforce “a

congressional policy . . . in a manner prescribed by Congress;”

instead, he called on FCC to “execute” a “presidential policy”

43

preference on net neutrality “in a manner prescribed by the

President.” Youngstown, 343 U.S. at 588. The President did

not ask Congress to reclassify broadband Internet access as a

“telecommunications service” and implement “net neutrality”

through public utility regulation. Rather, the President urged

the FCC to reject Congress’s deregulatory aims and its

classification of Internet access to further his preferred

approach to “net neutrality.” As explained above, the

classification of Internet access as “information service” is a

core feature of the 1996 Act. The use of forbearance to lessen,

rather than expand common carrier regulation, and the

prohibition on treating mobile broadband Internet access as

common carriage are all part of the 1996 Act’s deregulatory

text, history, and structure. Nevertheless, the President sought

to change this law not by petitioning Congress, but by

influencing the FCC’s deliberations over how to enforce

existing law. The President’s conduct collapsed the distinction

between his constitutional authority to seek changes in the law

from the legislature, and his constitutional obligation to

faithfully execute the law passed by Congress when interacting

with the agency charged with executing the law.

The President’s obligation to “faithfully” execute existing

law limits the realm of reasonable constructions he can provide

to those charged with enforcing existing law. For example,

during the “Quasi War” with France, Congress passed a statute

permitting the seizure of any U.S. ship bound for France or its

dependent powers. When President Adams sent the statute to

the military for execution, he reinterpreted the statute—

allowing for the seizure of any U.S. ship going “to or from

Fr[e]nch ports.” See Little v. Barreme, 6 U.S. (2 Cranch) 170,

178 (1804) (emphasis added). The Supreme Court affirmed the

Circuit Court’s finding that the seizure of a U.S. ship from

French-controlled Haiti (then Jérémie) to Danish-controlled St.

Thomas was invalid. Writing for the Court, Chief Justice

44

Marshall said it did not matter that the President’s construction

was motivated by it being “obvious[] that if only vessels sailing

to a French port could be seized on the high seas that the law

would very often be evaded.” Id. Congress, the Marshall Court

said, “prescribed [] the manner in which this law shall be

carried into execution,” and that “was to exclude a seizure of

any vessel not bound to a French port.” Id. at 177–78.

President Adams, however, gave it a “different construction,”

id. at 178, one at odds with what Congress passed in both the

statute’s “general clause” stating its purpose and the statute’s

more specific limitations, id. at 177–78.

Similarly here, 8 the President urged the FCC to adopt a

construction of Internet classification at odds with both the

“general clause[s]” of the 1996 Act’s deregulatory policy and

the statute’s more specific definitions of “interactive computer

service,” “information service,” “Internet access service,”

“interconnected service,” and “the public switched network.”

No doubt the President thought reclassifying broadband

8

That the military is under the President’s command and the FCC is

an independent agency is of no moment here. The issue here is not

the scope of the President’s authority to enforce the law (i.e., the

extent to which the President can “direct” the FCC to act). Rather,

the issue here is the nature of the authority the President exercises

when seeking to change the enforcement of existing law.

Enforcement authority cannot be conflated with the President’s

separate and distinct ability to petition for changes in existing law

itself. Nevertheless, as explained above, that is what the President

attempted. It is no answer to say the President’s action is not subject

to judicial direction. See Mississippi v. Johnson, 71 U.S. (4 Wall.)

475, 499 (1867). I do not dispute that the Court cannot issue an order

directing the President’s “exercise of judgment” in law enforcement.

See id. What is within this Court’s determination, however, is

whether the Order at issue faithfully executes existing law. It does

not, and it does not because of the construction set forth by the

President.

45

Internet access better captured the on-the-ground realities of

Internet access. But, as in Barreme, Congress “prescribed []

the manner in which this law shall be carried into execution,”

and the President is limited to urging the execution of existing

law with legal constructions that faithfully execute what

Congress enacted. See id. at 177–78. As Justice Jackson

famously put it, “[w]hen the President takes measures

incompatible with the expressed or implied will of Congress,

his power is at its lowest ebb.” Youngstown, 343 U.S. at 637

(Jackson, J., concurring).

The President’s intervention did not result from a “failure

of Congress to legislate” on the issue of Internet access

regulation, but because he desired “a different and inconsistent

way of his own” respecting that regulation. See id. at 639

(Jackson, J., concurring). The fact that Congress has, up until

now, decided not to revise its 1996 Act with legislation

amenable to President Obama’s view of Internet regulation

does not mean Congress has “failed” to act. Congress “acted”

with respect to the classification of Internet access service in

1996—if President Obama thought a reclassification was

needed, then Congress was the place to go. See, e.g., id. at 603

(Frankfurter, J., concurring) (explaining that, five years before

President Truman’s steel seizure, “Congress said to the

President, ‘You may not seize. Please report to us and ask for

seizure power if you think it is needed in a specific situation.’”).

Nothing about our Constitution’s deliberative legislative

structure is meant to facilitate a one-way ratchet in the

President’s favor. See id. at 604 (Frankfurter, J., concurring)

(“The need for new legislation does not enact it. Nor does it

repeal or amend existing law.”); THE FEDERALIST NO. 73

(Hamilton) p. 442 (Clinton Rosseiter ed., 1961) (“It may

perhaps be said that the power of preventing bad laws includes

that of preventing good ones . . . . But this objection will have

little weight with those who can properly estimate the

46

mischiefs of that inconstancy and mutability in the laws . . . .

They will consider every institution calculated to . . . keep

things in the same state in which they happen to be at any given

period as much more likely to do good than harm.”). Nor does

the Constitution give the President an “I’m-frustrated-with-

democracy” exception to Bicameralism and Presentment;

allowing him to petition the FCC, rather than Congress, for a

change in existing law. See NLRB v. Noel Canning, 134 S. Ct.

2550, 2567 (2014) (“It should go without saying . . . that

political opposition in the Senate would not qualify as an

unusual circumstance” allowing the President to disregard

constitutional limitations).

“With all its defects, delays and inconveniences, men have

discovered no technique for long preserving free government

except that the Executive be under the law, and that the law be

made by parliamentary deliberations. . . . [I]t is the duty of the

Court to be last, not first, to give [these institutions] up.”

Youngstown, 343 U.S. at 655 (Jackson, J., concurring). This

issue deserved much more scrutiny than the silence given to it

by this Court.

V.

This Order shows signs of a government having grown

beyond the consent of the governed: the collapsing respect for

Bicameralism and Presentment; the administrative state

shoehorning major questions into long-extant statutory

provisions without congressional authorization; a preference

for rent-seeking over liberty. This Court had an opportunity to

see the wisdom of the “Man Controlling Trade” statue on

Constitution Avenue, but we are no longer on the

Constitution’s path. Hopefully, there is a clearer view of the

road back to a government of limited, enumerated power from

47

One First Street in our Capital City. In that hope, I respectfully

dissent from the Court’s denial of rehearing en banc.

KAVANAUGH, Circuit Judge, dissenting from the denial

of rehearing en banc:

The FCC’s 2015 net neutrality rule is one of the most

consequential regulations ever issued by any executive or

independent agency in the history of the United States. The

rule transforms the Internet by imposing common-carrier

obligations on Internet service providers and thereby

prohibiting Internet service providers from exercising

editorial control over the content they transmit to consumers.

The rule will affect every Internet service provider, every

Internet content provider, and every Internet consumer. The

economic and political significance of the rule is vast.

The net neutrality rule is unlawful and must be vacated,

however, for two alternative and independent reasons.

First, Congress did not clearly authorize the FCC to issue

the net neutrality rule. Congress has debated net neutrality for

many years, but Congress has never enacted net neutrality

legislation or clearly authorized the FCC to impose common-

carrier obligations on Internet service providers. The lack of

clear congressional authorization matters. In a series of

important cases over the last 25 years, the Supreme Court has

required clear congressional authorization for major agency

rules of this kind. The Court, speaking through Justice Scalia,

recently summarized the major rules doctrine in this way:

“We expect Congress to speak clearly if it wishes to assign to

an agency decisions of vast ‘economic and political

significance.’” Utility Air Regulatory Group v. EPA, 134 S.

Ct. 2427, 2444, slip op. at 19 (2014) (quoting FDA v. Brown

& Williamson Tobacco Corp., 529 U.S. 120, 160 (2000)).

The major rules doctrine helps preserve the separation of

powers and operates as a vital check on expansive and

aggressive assertions of executive authority.

2

Here, because Congress never passed net neutrality

legislation, the FCC relied on the 1934 Communications Act,

as amended in 1996, as its source of authority for the net

neutrality rule. But that Act does not supply clear

congressional authorization for the FCC to impose common-

carrier regulation on Internet service providers. Therefore,

under the Supreme Court’s precedents applying the major

rules doctrine, the net neutrality rule is unlawful.

Second and in the alternative, the net neutrality rule

violates the First Amendment to the U.S. Constitution. Under

the Supreme Court’s landmark decisions in Turner

Broadcasting System, Inc. v. FCC, 512 U.S. 622 (1994), and

Turner Broadcasting System, Inc. v. FCC, 520 U.S. 180

(1997), the First Amendment bars the Government from

restricting the editorial discretion of Internet service

providers, absent a showing that an Internet service provider

possesses market power in a relevant geographic market.

Here, however, the FCC has not even tried to make a market

power showing. Therefore, under the Supreme Court’s

precedents applying the First Amendment, the net neutrality

rule violates the First Amendment.

In short, although the briefs and commentary about the

net neutrality issue are voluminous, the legal analysis is

straightforward: If the Supreme Court’s major rules doctrine

means what it says, then the net neutrality rule is unlawful

because Congress has not clearly authorized the FCC to issue

this major rule. And if the Supreme Court’s Turner

Broadcasting decisions mean what they say, then the net

neutrality rule is unlawful because the rule impermissibly

infringes on the Internet service providers’ editorial

discretion. To state the obvious, the Supreme Court could

always refine or reconsider the major rules doctrine or its

decisions in the Turner Broadcasting cases. But as a lower

3

court, we do not possess that power. Our job is to apply

Supreme Court precedent as it stands.

For those two alternative and independent reasons, the

FCC’s net neutrality regulation is unlawful and must be

vacated. I respectfully disagree with the panel majority’s

contrary decision and, given the exceptional importance of the

issue, respectfully dissent from the denial of rehearing en

banc.1

I

The FCC’s net neutrality rule is a major rule, but

Congress has not clearly authorized the FCC to issue the rule.

For that reason alone, the rule is unlawful.

A

The Framers of the Constitution viewed the separation of

powers as the great safeguard of liberty in the new National

Government. To protect liberty, the Constitution divides

power among the three branches of the National Government.

The Constitution vests Congress with the legislative power.

U.S. CONST. art. I, § 1. The Constitution vests the President

with the executive power, including the responsibility to “take

1

I also agree with much of Judge Williams’ panel dissent and

with much of Part III.A and Part III.B of Judge Brown’s dissent

from denial of rehearing en banc.

The concurrence in the denial of rehearing en banc suggests

that the FCC may withdraw the net neutrality rule, mitigating any

need for en banc review now. Unless and until the FCC does so,

however, the panel opinion will remain the law of the Circuit. If

the panel were to withdraw its opinion or if the opinion gets vacated

as moot, then the need for en banc review would go away as well.

But not until then, in my judgment.

4

Care that the Laws be faithfully executed.” Id. art. II, § 1, cl.

1; id. § 3. The Constitution vests the Judiciary with the

judicial power, including the power in appropriate cases to

determine whether the Executive has acted consistently with

the Constitution and statutes. See id. art. III, §§ 1, 2; Marbury

v. Madison, 5 U.S. 137 (1803).

Under the Constitution’s separation of powers, Congress

makes the laws, and the Executive implements and enforces

the laws. The Executive Branch does not possess a general,

free-standing authority to issue binding legal rules. The

Executive may issue rules only pursuant to and consistent

with a grant of authority from Congress (or a grant of

authority directly from the Constitution). See Youngstown

Sheet & Tube Co. v. Sawyer, 343 U.S. 579, 585 (1952).

When the Judiciary exercises its Article III authority to

determine whether an agency’s rule is consistent with a

governing statute, two competing canons of statutory

interpretation come into play.

First, for ordinary agency rules, the Supreme Court

applies what is known as Chevron deference to authoritative

agency interpretations of statutes. If the statute is clear, the

agency must follow the statute. But if the statute is

ambiguous, the agency has discretion to adopt its own

preferred interpretation, so long as that interpretation is at

least reasonable. See Chevron U.S.A. Inc. v. Natural

Resources Defense Council, Inc., 467 U.S. 837, 842-45

(1984). The theory of Chevron is that a statutory ambiguity

or gap reflects Congress’s implicit delegation of authority for

the agency to make policy and issue rules within the

reasonable range of the statutory ambiguity or gap.

5

Second, in a narrow class of cases involving major

agency rules of great economic and political significance, the

Supreme Court has articulated a countervailing canon that

constrains the Executive and helps to maintain the

Constitution’s separation of powers. For an agency to issue a

major rule, Congress must clearly authorize the agency to do

so. If a statute only ambiguously supplies authority for the

major rule, the rule is unlawful. This major rules doctrine

(usually called the major questions doctrine) is grounded in

two overlapping and reinforcing presumptions: (i) a

separation of powers-based presumption against the

delegation of major lawmaking authority from Congress to

the Executive Branch, see Industrial Union Department, AFL-

CIO v. American Petroleum Institute, 448 U.S. 607, 645-46

(1980) (opinion of Stevens, J.), and (ii) a presumption that

Congress intends to make major policy decisions itself, not

leave those decisions to agencies.

In short, while the Chevron doctrine allows an agency to

rely on statutory ambiguity to issue ordinary rules, the major

rules doctrine prevents an agency from relying on statutory

ambiguity to issue major rules.

Justice Breyer appears to have been the first to describe a

dichotomy between ordinary and major rules and to articulate

the major rules doctrine as a distinct principle of statutory

interpretation. In an article written more than 30 years ago,

he explained the principle this way: When determining “the

extent to which Congress intended that courts should defer to

the agency’s view of the proper interpretation,” courts should

take into account the legislative reality that Congress may

grant the Executive Branch the authority to resolve various

“interstitial matters,” but Congress itself is “more likely to

have focused upon, and answered, major questions.” Stephen

Breyer, Judicial Review of Questions of Law and Policy, 38

6

Admin. L. Rev. 363, 370 (1986). Citing Justice Breyer’s

1986 article, the Supreme Court later explained that, in

“extraordinary cases,” Congress could not have “intended to

delegate a decision of such economic and political

significance to an agency in so cryptic a fashion.” FDA v.

Brown & Williamson Tobacco Corp., 529 U.S. 120, 159, 160

(2000).

In keeping with the principle articulated by Justice

Breyer, the Supreme Court has repeatedly rejected agency

attempts to take major regulatory action without clear

congressional authorization. Consider the following

examples:

 MCI Telecommunications Corp. v. American

Telephone & Telegraph Co., 512 U.S. 218 (1994).

The Communications Act of 1934 gave the FCC

authority to “modify” rate-filing requirements. The

FCC issued a rule that completely exempted certain

telephone companies from rate-filing requirements.

The Court struck down the rule, holding that the

FCC’s authority to modify statutory requirements did

not permit the agency to eliminate those requirements.

It would have been a major step for the FCC to

eliminate those requirements. Yet there was no clear

statutory authority for the FCC to do so. The Court

explained that it was “highly unlikely that Congress

would leave the determination of whether an industry

will be entirely, or even substantially, rate-regulated to

agency discretion.” Id. at 231.

 FDA v. Brown & Williamson Tobacco Corp., 529 U.S.

120 (2000). The Food, Drug, and Cosmetic Act gave

the FDA broad and general authority to regulate

“drugs” and “devices.” The FDA attempted to use this

general authority to regulate the tobacco industry,

7

including cigarettes. Regulating cigarettes would have

been a major economic and political action. Yet there

was no clear statutory authorization for the FDA to

regulate the tobacco industry generally, or cigarettes

specifically. The Court thus invalidated the rule,

stating that it was “confident that Congress could not

have intended to delegate a decision of such economic

and political significance to an agency in so cryptic a

fashion.” Id. at 160.

 Gonzales v. Oregon, 546 U.S. 243 (2006). The

Controlled Substances Act gave the Attorney General

authority to de-register physicians, thus preventing

them from writing prescriptions for certain drugs, if

the Attorney General concluded that de-registration

was in the “public interest.” The Attorney General

issued an interpretive rule declaring that physicians

could not prescribe controlled substances for assisted

suicides. It would have been a major step for the

Attorney General to proscribe physician-assisted

suicide in this way. Yet there was no clear statutory

authority for the Attorney General to do so. The Court

therefore rejected the rule, stating that it “would be

anomalous for Congress to have so painstakingly

described the Attorney General’s limited authority to

deregister a single physician or schedule a single drug,

but to have given him, just by implication, authority to

declare an entire class of activity outside the course of

professional practice.” Id. at 262 (internal quotation

marks omitted). “The idea that Congress gave the

Attorney General such broad and unusual authority

through an implicit delegation in the CSA’s

registration provision is not sustainable.” Id. at 267.

 Utility Air Regulatory Group v. EPA, 134 S. Ct. 2427

(2014). Various parts of the Clean Air Act gave the

Environmental Protection Agency authority to

8

regulate “any air pollutant.” It was not clear whether

greenhouse gases were air pollutants for all Clean Air

Act programs. The EPA nonetheless promulgated a

rule subjecting millions of previously unregulated

emitters of greenhouse gases to burdensome

permitting regulations under the Clean Air Act’s

Prevention of Significant Deterioration and Title V

permitting programs. It would have been a major step

for EPA to regulate the greenhouse gas emissions of

so many large and small facilities. But there was no

clear statutory authorization for the EPA to do so. As

a result, the Supreme Court vacated the relevant part

of the rule, stating: “When an agency claims to

discover in a long-extant statute an unheralded power

to regulate ‘a significant portion of the American

economy,’ we typically greet its announcement with a

measure of skepticism. We expect Congress to speak

clearly if it wishes to assign to an agency decisions of

vast ‘economic and political significance.’” Id. at

2444, slip op. at 19 (quoting Brown & Williamson,

529 U.S. at 159, 160) (citation omitted).2

2

For completeness, two other cases warrant mention. First, in

Massachusetts v. EPA, 549 U.S. 497 (2007), the Court concluded

that the Clean Air Act’s provision for the regulation of new motor

vehicles clearly authorized EPA to regulate the greenhouse gas

emissions of those vehicles, once EPA made a finding that

greenhouse gases may endanger the public health. See id. at 528-

29. So even though such a rule would presumably be a major rule,

the statute clearly authorized it, according to the Court. In UARG,

by contrast, the Court concluded that the Clean Air Act’s

Prevention of Significant Deterioration and Title V permitting

programs did not clearly authorize EPA to regulate emitters of

greenhouse gases under those programs.

Second, in King v. Burwell, 135 S. Ct. 2480 (2015), the Court

applied a form of the major rules doctrine and stated that Chevron

9

The lesson from those cases is apparent. If an agency

wants to exercise expansive regulatory authority over some

major social or economic activity – regulating cigarettes,

banning physician-assisted suicide, eliminating

telecommunications rate-filing requirements, or regulating

greenhouse gas emitters, for example – an ambiguous grant of

statutory authority is not enough. Congress must clearly

authorize an agency to take such a major regulatory action.3

Consistent with the Supreme Court case law, leading

scholars on statutory interpretation have recognized the

significance of the major rules doctrine. Professor Eskridge

has explained the doctrine this way: The “Supreme Court has

carved out a potentially important exception to delegation, the

deference did not apply to the major question of whether the

Affordable Care Act authorized government subsidies to

individuals who obtained health insurance on exchanges established

by the Federal Government. Id. at 2488-89, slip op. at 8. That case

is somewhat different from the prototypical major rules cases

because the agency in that particular rule was not seeking to

regulate or de-regulate (as opposed to tax or subsidize) some major

private activity. Rather, the case concerned the scope of

government subsidies under the health care statute. The case

therefore seems to stand for the distinct proposition that Chevron

deference may not apply when an agency interprets a major

government benefits or appropriations provision of a statute.

3

This Court has also employed the major rules doctrine. See,

e.g., District of Columbia v. Department of Labor, 819 F.3d 444,

446 (D.C. Cir. 2016) (rejecting the Department of Labor’s

interpretation of the Davis-Bacon Act, which regulates public

works, to apply to construction of privately funded, owned, and

operated buildings); Loving v. IRS, 742 F.3d 1013, 1021 (D.C. Cir.

2014) (rejecting the Internal Revenue Service’s interpretation of a

tax statute to authorize new regulation of hundreds of thousands of

tax-return preparers).

10

major questions canon. Even if Congress has delegated an

agency general rulemaking or adjudicatory power, judges

presume that Congress does not delegate its authority to settle

or amend major social and economic policy decisions.”

WILLIAM N. ESKRIDGE JR., INTERPRETING LAW: A PRIMER ON

HOW TO READ STATUTES AND THE CONSTITUTION 288 (2016).

The “key reason” for the doctrine, Professor Eskridge has

explained, “is the strong presumption of continuity for major

policies unless and until Congress has deliberated about and

enacted a change in those major policies . . . . Because a

major policy change should be made by the most

democratically accountable process—Article I, Section 7

legislation—this kind of continuity is consistent with

democratic values.” Id. at 289.

In their landmark study of Congress’s statutory drafting

practices, Professors Gluck and Bressman likewise stated that

“the major questions doctrine is a departure from Chevron’s

simple presumption of delegation. In particular, that doctrine

supports a presumption of nondelegation in the face of

statutory ambiguity over major policy questions or questions

of major political or economic significance.” Abbe R. Gluck

& Lisa Schultz Bressman, Statutory Interpretation from the

Inside—An Empirical Study of Congressional Drafting,

Delegation, and the Canons: Part I, 65 Stan. L. Rev. 901,

1003 (2013). Their empirical study concluded that the major

rules doctrine reflects congressional intent and accords with

the in-the-arena reality of how legislators and congressional

staff approach the legislative function. As one congressional

official put it to them: “Major policy questions, major

economic questions, major political questions, preemption

questions are all the same. Drafters don’t intend to leave

11

them unresolved.” Id. at 1004 (internal quotation marks and

alterations omitted).4

In short, the major rules doctrine constitutes an important

principle of statutory interpretation in agency cases. As a

lower court, we must follow the major rules doctrine as it has

been articulated by the Supreme Court.

B

In order for the FCC to issue a major rule, Congress must

provide clear authorization. We therefore must address two

questions in this case: (1) Is the net neutrality rule a major

rule? (2) If so, has Congress clearly authorized the FCC to

issue the net neutrality rule?

1

The FCC’s net neutrality rule is a major rule for purposes

of the Supreme Court’s major rules doctrine. Indeed, I

believe that proposition is indisputable.

The Supreme Court has described major rules as those of

“vast ‘economic and political significance.’” UARG, 134 S.

Ct. at 2444, slip op. at 19 (quoting Brown & Williamson, 529

4

Some commentators do not believe that there should be a

major rules doctrine. See, e.g., Lisa Heinzerling, The Power

Canons, 58 Wm. & Mary L. Rev. (forthcoming 2017); Kevin O.

Leske, Major Questions About the “Major Questions” Doctrine, 5

Mich. J. Envtl. & Admin. L. 479 (2016). But as a lower court, we

are constrained by precedent. The Supreme Court has articulated

and applied the major rules doctrine in a series of high-profile and

important cases. As a lower court, we cannot dismiss the Court’s

repeated invocations of the doctrine as casual or meaningless

asides. We cannot airbrush the cases out of the picture.

12

U.S at 160). The Court has not articulated a bright-line test

that distinguishes major rules from ordinary rules. As a

general matter, however, the Court’s cases indicate that a

number of factors are relevant, including: the amount of

money involved for regulated and affected parties, the overall

impact on the economy, the number of people affected, and

the degree of congressional and public attention to the issue.

See UARG, 134 S. Ct. at 2443-44, slip op. at 17-19 (regulation

would impose massive compliance costs on millions of

previously unregulated emitters); Gonzales v. Oregon, 546

U.S. at 267 (physician-assisted suicide is an important issue

subject to “earnest and profound debate across the country”);

Brown & Williamson, 529 U.S. at 126-27, 133, 143-61

(FDA’s asserted authority would give it expansive power over

tobacco industry, which was previously unregulated under the

relevant statute); MCI, 512 U.S. at 230, 231 (rate-filing

requirements are “utterly central” and of “enormous

importance” to the statutory scheme). The Court’s concern

about an agency’s issuance of a seemingly major rule is

heightened, moreover, when an agency relies on a long-extant

statute to support the agency’s bold new assertion of

regulatory authority. See UARG, 134 S. Ct. at 2444, slip op.

at 19.

To be sure, determining whether a rule constitutes a

major rule sometimes has a bit of a “know it when you see it”

quality. So there inevitably will be close cases and debates at

the margins about whether a rule qualifies as major. But

under any conceivable test for what makes a rule major, the

net neutrality rule qualifies as a major rule.

The net neutrality rule is a major rule because it imposes

common-carrier regulation on Internet service providers. (A

common carrier generally must carry all traffic on an equal

basis without unreasonable discrimination as to price and

13

carriage.) In so doing, the net neutrality rule fundamentally

transforms the Internet by prohibiting Internet service

providers from choosing the content they want to transmit to

consumers and from fully responding to their customers’

preferences. The rule therefore wrests control of the Internet

from the people and private Internet service providers and

gives control to the Government. The rule will affect every

Internet service provider, every Internet content provider, and

every Internet consumer. The financial impact of the rule – in

terms of the portion of the economy affected, as well as the

impact on investment in infrastructure, content, and

business – is staggering. Not surprisingly, consumer interest

groups and industry groups alike have mobilized

extraordinary resources to influence the outcome of the policy

discussions.

Moreover, Congress and the public have paid close

attention to the issue. Congress has been studying and

debating net neutrality regulation for years. It has considered

(but never passed) a variety of bills relating to net neutrality

and the imposition of common-carrier regulations on Internet

service providers. See, e.g., H.R. 5252, 109th Cong. (2006);

H.R. 5273, 109th Cong. (2006); H.R. 5417, 109th Cong.

(2006); S. 2360, 109th Cong. (2006); S. 2686, 109th Cong.

(2006); S. 2917, 109th Cong. (2006); S. 215, 110th Cong.

(2007); H.R. 5353, 110th Cong. (2008); H.R. 5994, 110th

Cong. (2008); H.R. 3458, 111th Cong. (2009); S. 74, 112th

Cong. (2011); S. 3703, 112th Cong. (2012); H.R. 2666, 114th

Cong. (2016). The public has also focused intensely on the

net neutrality debate. For example, when the issue was before

the FCC, the agency received some 4 million comments on

the proposed rule, apparently the largest number (by far) of

comments that the FCC has ever received about a proposed

rule. Indeed, even President Obama publicly weighed in on

the net neutrality issue, an unusual presidential action when

14

an independent agency is considering a proposed rule. See

Statement on Internet Neutrality, 2014 DAILY COMP. PRES.

DOC. 841 (Nov. 10, 2014). The President’s intervention only

underscores the enormous significance of the net neutrality

issue.

In addition, as in other cases where the Supreme Court

has held that the major rules doctrine applied, the FCC is

relying here on a long-extant statute – namely, the

Communications Act of 1934, as amended in 1996. In

UARG, the Supreme Court wrote the following: “When an

agency claims to discover in a long-extant statute an

unheralded power to regulate ‘a significant portion of the

American economy,’ we typically greet its announcement

with a measure of skepticism. We expect Congress to speak

clearly if it wishes to assign to an agency decisions of vast

‘economic and political significance.’” 134 S. Ct. at 2444,

slip op. at 19 (quoting Brown & Williamson, 529 U.S. at 159,

160) (citation omitted). The Court in UARG might as well

have been speaking about the net neutrality rule. That UARG

language is directly on point here.

The net neutrality rule is a major rule under any plausible

conception of the major rules doctrine. As Judge Brown

rightly states, “any other conclusion would fail the straight-

face test.” Brown Dissent at 18.

2

Because the net neutrality rule is a major rule, the next

question is whether Congress clearly authorized the FCC to

issue the net neutrality rule and impose common-carrier

regulations on Internet service providers. The answer is no.

15

Congress enacted the Communications Act in 1934 and

amended it in 1996. The statute sets up different regulatory

schemes for “telecommunications services” and “information

services.” To simplify for present purposes, the statute

authorizes heavy common-carrier regulation of

telecommunications services but light regulation of

information services. (Recall that a common carrier generally

must carry all traffic on an equal basis without unreasonable

discriminatio

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