Amicus Curiae Brief — New York State Telecommunications Association, Inc., et al., Petitioners v. Letitia James, Attorney General of New York

No. 24-161

IN THE

Supreme Court of the United States

__________

NEW YORK STATE TELECOMMUNICATIONS

ASSOCIATION, INC., ET AL.,

Petitioners,

V.

LETITIA A. JAMES, IN HER OFFICIAL CAPACITY AS

ATTORNEY GENERAL OF NEW YORK,

Respondent.

__________________

ON PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURTS OF APPEALS

FOR THE SECOND CIRCUIT

__________________

BRIEF OF THE MULTICULTURAL MEDIA,

TELECOM, AND INTERNET COUNCIL AS

AMICUS CURIAE IN SUPPORT OF

PETITIONERS

__________________

JENNIFER TATEL

Counsel of Record

DANIEL H. KAHN

MORGAN O. SCHICK

WILKINSON BARKER KNAUER, LLP

1800 M Street, NW, Suite 800N

Washington, DC 20036

(202) 783-4141

jtatel@wbklaw.com

Counsel for Amicus Curiae

LEGAL PRINTERS LLC ! Washington, DC ! 202-747-2400 ! legalprinters.com

i

TABLE OF CONTENTS

Table of Authorities ................................................... ii

Interest of Amicus Curiae ...........................................1

Summary of Argument ...............................................2

Argument.....................................................................3

I.

The Digital Divide Harms Communities of Color

and Other Vulnerable Americans ........................3

II. The ABA Would Make it Harder to Close the

Digital Divide........................................................6

III. The ABA Undermines the Benefits of The FCC’s

Consistent Approach to Rate Regulation ..........10

Conclusion .................................................................13

ii

TABLE OF AUTHORITIES

Cases

N.Y. State Telecom. Ass’n v. James, 101 F.4th 135

(2d Cir. 2024) ......................................................... 2

N.Y. State Telecom. Ass’n v. James, 544 F.Supp.3d

269 (E.D.N.Y. 2021) ................................................ 7

Statutes

47 U.S.C. § 254 ........................................................... 9

47 U.S.C. § 1701 ..................................................... 3, 4

N.Y. Gen. Bus. Law § 399-zzzzz ................................ 2

Rules

Restoring Internet Freedom, WC Docket No. 17-108,

Declaratory Ruling, Report and Order, and Order,

33 FCC Rcd 311 (2018) ......................................... 11

Safeguarding and Securing the Open Internet,

Declaratory Ruling, Order, Report and Order, and

Order on Reconsideration, FCC 24-52 (rel. May 7,

2024) ............................................................ 3, 11, 12

Other Authorities

Andrew Perrin & Sara Atske, Pew Research Ctr., 7%

of Americans Don’t Use the Internet. Who Are

They? (Apr. 2, 2021) ................................................ 5

iii

Connecting America: Oversight of the FCC: Hearing

Before the Subcomm. on Commc’ns & Tech. of the

H. Comm. on Energy & Com., 117th Cong.

(2022) .................................................................... 11

Daniela Mejía, U.S. Census Bureau, Computer and

Internet Use in the United States: 2021, American

Community Survey Reports, ACS-56 (June

2024)…………………………………………………… 4

Emily A. Vogels, Pew Research Ctr., Digital Divide

Persists Even as Americans with Lower Incomes

Make Gains in Tech Adoption (June 22, 2021)...... 6

FCC, National Broadband Map ................................ 5

Inquiry Concerning the Deployment of Advanced

Telecommunications Capability to All Americans

in a Reasonable and Timely Fashion, 2024 Section

706 Report, FCC 24-27 (rel. Mar. 18, 2024) .......... 4

John B. Horrigan, Pew Research Ctr., Digital

Readiness Gaps (Sept. 20, 2016) ............................ 6

Keith N. Hampton et al., Quello Center, Mich. State

Univ., Broadband and Student Performance Gaps

After the COVID-19 Pandemic (2023) .................... 5

Pew Research Ctr., Internet, Broadband Fact Sheet

(Jan. 31, 2024) ........................................................ 4

Sara Atske & Andrew Perrin, Pew Research Ctr.,

Home Broadband Adoption, Computer Ownership

Vary by Race, Ethnicity in the U.S. (Jul. 16,

2021) ........................................................................ 6

iv

Timothy J. Tardiff, Advanced Analytical Consulting

Group, State Utility-Style Regulation of Wireless

and Broadband Services (Nov. 2022)..................... 8

1

INTEREST OF AMICUS CURIAE 1

Multicultural Media, Telecom, and Internet

Council (“MMTC”) is the technology, media, and

telecommunications industries’ leading national nonpartisan, non-profit diversity organization. Since its

founding in 1986, MMTC has been dedicated to

promoting and preserving equal opportunity and civil

rights in the media and telecommunications

industries. MMTC conducts civil rights advocacy,

undertakes research and analysis centered

particularly around broadband access and adoption,

and participates in state and federal proceedings

focused on the same. MMTC supports efforts to close

the digital divide and bring broadband access to more

people of color, as well as to other vulnerable

populations. MMTC has participated in numerous

Federal Communications Commission (“FCC”)

proceedings relating to broadband. This case is

important to MMTC because state broadband rate

regulation creates an obstacle to the network

investment and marketplace competition necessary to

connect communities of color to broadband. MMTC

participated in the case as an amicus below.

1 Amicus provided all parties with timely notice as required by

Supreme Court Rule 37.2. Pursuant to Supreme Court Rule No.

37.6, no counsel for a party authored the brief in whole or in part;

and no person or entity other than amicus or its counsel made a

monetary contribution intended to fund the preparation or

submission of the brief.

2

SUMMARY OF ARGUMENT

Deployment of broadband across the U.S. has been

among the marvels of our age. The “digital divide” –

the gap between those who have access to and can

afford broadband, and those who cannot or do not

subscribe – disproportionately impacts communities

of color. While presumably well-intentioned, New

York’s “Affordable Broadband Act” or “ABA” 2 is

unavoidably inimical to the closure of the digital

divide, both in New York and elsewhere.

The digital divide stands in the way of all too many

disadvantaged American communities – whether lowincome, Tribal, communities of color, or rural –

having the equal ability to participate in the modern

economy. Today, it is essential to connect everyone to

the opportunity that the internet makes available.

State-specific regulation of broadband via rate caps is

fundamentally harmful to closing the digital divide,

and the Second Circuit erred in upholding the law. 3

Price regulation stands in the way of costly network

investment that could, if not undermined, continue to

facilitate accessible and affordable service in more

communities of color and other disadvantaged

communities. The ABA would deter competitive

entry, distort the broadband marketplace, and leave

communities in need of investment lagging behind

with inferior broadband choices.

2 See generally N.Y. Gen. Bus. Law § 399-zzzzz.

3 See N.Y. State Telecom. Ass’n v. James, 101 F.4th 135 (2d Cir.

2024).

3

The FCC’s intended approach to regulation of

broadband has fundamentally shifted during the

pendency of this case, but under each such framework

the agency has foresworn regulating broadband

prices. This Court should not permit New York to

undermine the bipartisan consensus against

broadband rate regulation. Permitting the ABA to

stand would open the floodgates for additional state

regulation that would drown efforts to achieve the allimportant goal of closing the digital divide.

ARGUMENT

I.

The Digital Divide Harms Communities of

Color and Other Vulnerable Americans

Ensuring affordable broadband connectivity is a

critical and urgent civil rights challenge. As Congress

recently recognized, “[a]ccess to affordable, reliable,

high-speed broadband is essential to full participation

in modern life in the United States.” 4 To lack

broadband access is too often to lack the ability to

learn a new skill, obtain a valuable education, secure

a quality and high-wage job, participate in civic

dialogue, benefit from telemedicine – or even simply

stay connected with loved ones at a distance. Wide

swaths of many of our lives permanently moved

online in the wake of the recent unprecedent global

pandemic, and now more than ever high-speed

4 47 U.S.C. § 1701(1); see also, e.g., Safeguarding and Securing

the Open Internet, Declaratory Ruling, Order, Report and Order,

and Order on Reconsideration, FCC 24-52, ¶ 1 (rel. May 7, 2024)

(“2024 Open Internet Order”) (“Access to broadband Internet is

now an unquestionable necessity.”).

4

internet access

everyday living.

is

fundamentally

essential

to

Unfortunately, this reality is accompanied by a

harsher truth: Too many Americans still are not

connected to modern, high-speed networks. And the

negative consequences of this “divide” are not felt

equally; as Congress identified, the “digital

divide disproportionately affects communities of

color, lower-income areas, and rural areas.” 5 This

statutory finding is, regrettably, amply supported by

extensive data. For instance, over thirty percent of

Black and twenty-five percent of Latino families lack

high-speed home internet. 6 Less than three-quarters

of households with incomes of below $25,000 per year

reported broadband subscriptions, compared to

almost 98 percent of households with incomes of over

$150,000 a year. 7 Tribal areas lag behind the rest of

the country in terms of access to modern 5G mobile

broadband and fixed terrestrial broadband at every

speed tier. 8 Even two years after the pandemic

5 47 U.S.C. § 1701(3).

6 Pew Research Ctr., Internet, Broadband Fact Sheet (Jan. 31,

2024),

https://www.pewresearch.org/internet/factsheet/internet-broadband/.

7 Daniela Mejía, U.S. Census Bureau, Computer and Internet

Use in the United States: 2021, American Community Survey

Reports,

ACS-56,

at

5

tbl.1

(June

2024),

https://www2.census.gov/library/publications/2024/demo/acs56.pdf.

8

Inquiry Concerning the Deployment of Advanced

Telecommunications Capability to All Americans in a

Reasonable and Timely Fashion, 2024 Section 706 Report, FCC

24-27, ¶ 61 fig.1, ¶ 79 fig. 7 (rel. Mar. 18, 2024).

5

shifted learning online for many, in 2022 over one

quarter of students of color in Michigan reported

lacking fast home broadband, leaving them at an

education disadvantage. 9 In sum, the digital divide

remains a significant challenge.

The digital divide has multiple dimensions. It is

imperative to connect all Americans to high quality

broadband, as too many low-income and minority

Americans lack access to high-speed broadband

choices at their homes. 10 Deploying broadband is

highly capital intensive, and more such investment is

vital for communities of color across the country. But

making broadband service more available will not

alone suffice to ensure that non-subscribers will

actually adopt such service. Despite having ready

access to broadband services, millions of Americans

have still not subscribed. 11 Lack of access to devices

and deficiencies in digital literacy are examples of key

impediments to broadband adoption even in

circumstances where broadband service is made

9 Keith N. Hampton et al., Quello Center, Mich. State Univ.,

Broadband and Student Performance Gaps After the COVID-19

Pandemic,

at

16

(2023),

https://quello.msu.edu/wpcontent/uploads/2023/08/Broadband-and-Student-PerformanceGaps-After-the-COVID-19-Pandemic.pdf.

See generally FCC, National Broadband Map,

https://broadbandmap.fcc.gov/home (last visited Sept. 9, 2024).

10

11 Andrew Perrin & Sara Atske, Pew Research Ctr., 7% of

Americans Don’t Use the Internet. Who Are They? (Apr. 2, 2021),

https://www.pewresearch.org/short-reads/2021/04/02/7-ofamericans-dont-use-the-internet-who-are-they/.

6

broadly available to a community. 12 These issues are

particularly acute in low-income neighborhoods,

which often have significant minority and immigrant

populations. 13 While the ABA is a counterproductive

“solution,” the cost of broadband service is a

significant factor contributing to non-adoption. 14 To

address these complex challenges and truly connect

all communities, we need ongoing investment and

real, thoughtful solutions, not mandates like the

ABA.

II.

The ABA Would Make it Harder to Close the

Digital Divide.

Connecting everyone to broadband is vitally

important and deserves significant attention from

policymakers, including state legislatures. But doing

something is not enough: to truly aid communities of

12 As recently as 2016, a majority of Americans reported being

hesitant to adopt new technology despite its importance in

today’s world. John B. Horrigan, Pew Research Ctr., Digital

Readiness

Gaps,

at

3

(Sept.

20,

2016),

https://www.pewresearch.org/internet/wpcontent/uploads/sites/9/2016/09/PI_2016.09.20_DigitalReadiness-Gaps_FINAL.pdf.

13 See Sara Atske & Andrew Perrin, Pew Research Ctr., Home

Broadband Adoption, Computer Ownership Vary by Race,

Ethnicity

in

the

U.S.

(Jul.

16,

2021),

https://www.pewresearch.org/short-reads/2021/07/16/homebroadband-adoption-computer-ownership-vary-by-raceethnicity-in-the-u-s/.

14 Emily A. Vogels, Pew Research Ctr., Digital Divide Persists

Even as Americans with Lower Incomes Make Gains in Tech

Adoption (June 22, 2021), https://www.pewresearch.org/shortreads/2021/06/22/digital-divide-persists-even-as-americanswith-lower-incomes-make-gains-in-tech-adoption/.

7

color on the wrong side of the digital divide,

policymakers must pursue action that is effective and

abstain from measures that are counterproductive.

The ABA fails this test. If the ABA becomes effective,

it will achieve the opposite of what it purports to

accomplish, making it harder for communities of color

to subscribe to broadband.

Examining the ABA’s rate caps illustrates why.

The dollar figures set in the ABA are not the product

of any meaningful analysis. They do not account for

providers’ ability to recover costs (necessary to ensure

continuity of service, including for historically

disadvantaged communities), plans for future

deployment (including capital expenditure-reliant

deployments for the same communities), or even the

availability of broadband in the State of New York.

As a result, the district court concluded that the ABA

would require providers to offer their “services at a

loss,” and it also concluded that the ABA would

impose significant administrative costs. 15

At the risk of simplistic economic truism, no

business will invest where it will lose money, and loss

is exactly what the ABA would impose. As a result,

the ABA will deter new deployment and upgrades,

including in communities that need them. The

district court concluded that the ABA would “force

[providers] to cancel preexisting business plans for

upgrades to, and expansion of, their broadband

15 N.Y. State Telecom. Ass’n v. James, 544 F.Supp.3d 269, 276

(E.D.N.Y. 2021), reversed by 101 F.4th 135 (2d Cir. 2024). New

York did not challenge – and the Second Circuit did not question

these findings – on appeal.

8

networks[.]” 16 In particular, rate caps would force

smaller, would-be nascent competitors to abandon

expansion

plans. 17

Already-disadvantaged

communities do not benefit from laws that strip

providers of incentives to enter the market or improve

their service.

The ABA would not only hinder service

availability; it actually would hurt affordability. Rate

caps like the ABA’s serve to unwind economic

assumptions that made previous service pricings

viable. 18 A negative feedback loop of reduced revenue,

decreased investment, and price hikes for nonqualifying customers is foreseeable. Customers just

above the ABA’s thresholds or who otherwise do not

qualify may have to pay much more for whatever

options are available.

Further, increasing

competition has been far more effective in achieving

favorable rates for broadband consumers than

traditional top-down regulatory models could

achieve. 19 Thus, the ABA is actually inimical to true

Id. Again, New York did not challenge – and the Second

Circuit did not question – this conclusion.

16

17 See, e.g., Stay App. Ex. 11-12, Decl. of Glen Faulkner ¶¶ 3,6;

Decl. of Jason Miller, ¶¶ 9-10.

18 See, e.g., Stay App. Ex. 11, Decl. of Glen Faulkner ¶¶ 9-18.

19 For example, from 2010 to 2020, wireless rates decreased by

43 percent nationwide, while more heavily regulated electricity

rates increased 13%, and water rates increased 63%. See

Timothy J. Tardiff, Advanced Analytical Consulting Group,

State Utility-Style Regulation of Wireless and Broadband

Services,

at

4

(Nov.

2022),

https://api.ctia.org/wpcontent/uploads/2022/10/AACG-UtilitiesPaper_JL_Nov2022.pdf.

9

affordability for all consumers in the long run. The

digital divide will not be closed by stripping

underserved

communities

of

a

competitive

marketplace and resulting affordable prices that they

deserve.

The ABA is a threat to closing the digital divide

nationwide. If New York may impose rate caps on

providers, might not 55 other states and territories?

Each additional state that regulates broadband rates

can amplify the potential harms of rate regulation

within the regulated states. With a $25 cap in State A

and a $10 rate cap in State B, the mismatch of pricing

via state rate caps will deter providers from

expanding across states and ultimately lead to the

balkanization of which products and services are

available in different rate-regulated states. Those

that have reliable access to broadband today, and who

can afford it, may be fine with such an outcome. But

communities on the wrong side of the digital divide

cannot afford it.

If the ABA and other similar laws are allowed to

stand, the barriers to closing the digital divide would

extend even to states that do not enact broadband

rate regulation akin to the ABA. For providers in a

rate-regulated state with footprints in non-rateregulated states, the losses in rate-regulated states

will encourage price increases in non-rate regulated

states to offset the costs of compliance. Americans

already pay into a range of federal vehicles to address

the digital divide, via federal taxes and FCC

Universal Service Fund fees 20; it is inefficient and

20 See 47 U.S.C. § 254(d).

10

unjust to require citizens of other states and

territories to further subsidize below-cost rate caps in

rate-regulated states.

Such out-of-state rate

increases resulting from the ABA and similar laws

would be most harmful to those citizens of other

states who are already on the wrong side of the digital

divide – again, a group disproportionately comprised

of communities of color and other vulnerable groups.

Thus, the ABA would fundamentally operate as a

regressive tax on out-of-state communities themselves

in need of support. This is not the way forward

towards digital equity.

None of this is to say that states are helpless in the

face of the digital divide. They can and should pursue

effective measures such as investing resources in

promoting access and adoption, participating in and

encouraging community-led initiatives and publicprivate partnerships, lowering the barriers to entry

for broadband access, and promoting digital literacy.

But laws like the ABA are fundamentally harmful to

communities of color and disadvantaged Americans.

These groups need the full-fledged benefit of

broadband made available to other Americans – not

the stripped-down services that rate caps inevitably

encourage with providers trying to avoid loss and

maximize returns under artificial ceilings.

III. The ABA Undermines the Benefits of The

FCC’s Consistent Approach to Rate

Regulation

The FCC has acknowledged the harm of

broadband rate regulation on a bipartisan basis.

Indeed, FCC Chairwoman Jessica Rosenworcel has

11

recognized this in her pledge not to regulate rates for

broadband offerings. 21 Under the Restoring Internet

Freedom Order framework pursuant to which the

Second Circuit conducted its preemption analysis

(and that still applies today because of the Sixth

Circuit’s stay pending appeal), the FCC adopted a

deregulatory approach that facilitates private sector

efforts to close the digital divide by, among other

things, forgoing application of the sources of authority

that could permit rate regulation. 22 In the 2024 Open

Internet Order, despite pursuing a common carriage

framework for broadband, the FCC expressly stated

that it would not adopt rate regulation. 23

21 In response to questions during an oversight hearing before

the House Committee on Energy and Commerce’s Subcommittee

on Communications and Technology about whether she supports

rate regulation, Chairwoman Rosenworcel said “I support

consumer protection, but don’t believe that [rate regulation] is

the place [the Commission] should go in order to manage the

broadband industry on a going-forward basis. . . . There [are] no

asterisks.” See Connecting America: Oversight of the FCC:

Hearing Before the Subcomm. on Commc’ns & Tech. of the H.

Comm. on Energy & Com., 117th Cong. 60-61, 121 (2022)

(Statement of Jessica Rosenworcel, Chairwoman, Federal

Communications

Commission),

https://docs.house.gov/meetings/IF/IF16/20220331/114545/HHR

G-117-IF16-Transcript-20220331.pdf.

See Restoring Internet Freedom, WC Docket No. 17-108,

Declaratory Ruling, Report and Order, and Order, 33 FCC Rcd

311 (2018) (Restoring Internet Freedom Order).

22

23 2024 Open Internet Order ¶ 281 (stating that “we . . . do not

adopt any rate regulation”); id. ¶ 321 (stating that the FCC

“forbears from all ratemaking authority based on, or ratemaking

regulations adopted under, sections 201 and 202”).

12

State rate regulation of broadband interferes with

and is incompatible with the federal commitment not

to regulate rates because states are imposing the

same rate caps that the federal government has

determined are inappropriate. The ABA makes it

impossible to implement the sound national policy

against rate regulation. Indeed, permitting the ABA

could lead to, in effect, national broadband rate

regulation through the aggregative effect of state

legislation—even though the FCC has consistently

rejected broadband rate regulation.

Allowing the ABA to stand also renders irrelevant

the factual determinations that underlie the FCC’s

decisions against rate regulation. For instance, in the

recent 2024 Open Internet Order, in choosing not to

undertake rate regulation, the FCC observed that “we

have seen no significant increases in prices or

unreasonably discriminatory pricing that would seem

to warrant the imposition of rate regulation or

tariffing requirements.” 24 New York’s law, in other

words, would impose a harmful solution addressed to

a misapprehended problem.

Communities of color and disadvantaged

Americans

deserve

high-quality,

affordable,

competitive broadband service. Despite any good

intentions that motivated it, the ABA will move them

further from that goal. This Court can and should

prevent the ABA from undermining the sound

bipartisan consensus against creating new obstacles,

24 2024 Open Internet Order ¶ 315.

13

via counterproductive broadband rate regulation, to

closing the digital divide.

CONCLUSION

For the foregoing reasons, the Court should grant

certiorari in this case and reverse the lower court’s

judgment.

Respectfully submitted,

JENNIFER TATEL

Counsel of Record

DANIEL H. KAHN

MORGAN O. SCHICK

WILKINSON BARKER KNAUER, LLP

1800 M Street, NW, Suite 800N

Washington, DC 20036

(202) 783-4141

jtatel@wbklaw.com

Counsel for Amicus Curiae

September 13, 2024