Posted by: Hank Hultquist on July 7, 2010 at 10:43 am
Justice Scalia’s dissents are often described as “witty,” “erudite,” and even “brilliant.” In fact, they are so good that they’ve been collected into a book that gets almost all 5-star reviews on Amazon. Dissenting opinions sometimes do become the basis for a change of direction by the Court, but I’m pretty sure that no Federal agency has ever before reversed itself relying on the dissenting opinion in a Supreme Court decision that upheld the agency’s current historical interpretation of the law — which is what the FCC is proposing to do in the Third Way NOI.
This somewhat novel strategy does carry a high degree of difficulty. It may turn out to be the legal equivalent of a reverse two-and-a-half with a one-half twist from the pike position. While part of me wants to applaud the FCC’s bravado, I think they’re likely to be headed for a belly flop.
As far as I can tell, the FCC’s theory appears to be based on a hypothetical in which the majority (hypothetically) would have agreed with the legal premise of Justice Scalia’s dissent in which cable modem service consisted of two separate offers, one an information service and the other a telecommunications service. This theory ignores the fact the Supreme Court would have had to address the long-standing doctrine of “mutual exclusivity,” under which a service is classified as either an information service or a telecommunications service. The mutual exclusivity doctrine was described to the Supreme Court by the FCC and the Department of Justice as “supported by the 1996 Act’s legislative history and by decades of administrative practice, including the FCC contemporaneous construction of the 1996 Act.” The FCC’s theory about how the Supreme Court majority might have addressed the hypothetical is not a serious basis for reversing course.
The risks inherent in the “Scalia approach” become clear in paragraph 106 of the Third Way NOI. This same paragraph has a footnote to a wise man’s ruminations, which I encourage you to read.
The FCC seems to suggest, per Justice Scalia’s dissent, that the FCC could find that while “facilities-based” ISPs offer both information and telecommunications services, “non-facilities-based” ISPs only offer information services. According to Justice Scalia, “non-facilities-based ISPs stand in a different position in the eyes of the consumer than the provider of the physical connection.”
Well, that’s an interesting theory, but it’s also a theory that the majority opinion squarely rejected as inconsistent with the framework set out in the statutory definitions.
The Supreme Court majority made clear that while the FCC may be free to impose special duties on facilities-based ISPs under its ancillary Title I jurisdiction, the statutory definitions make no such distinctions.
In other words, the FCC cannot arbitrarily and capriciously declare that there is a legal definitional difference between the offerings of facilities-based and non-facilities-based ISPs. The offering is either a telecom service or it is not. In practical terms, this means if the FCC were to go down the Title 2 route and create this “Internet connectivity service“, all the products and services that contain a transmission component – the “Internet Connectivity Service,” would therefore be a telecommunications service, no if, ands, or buts — which may explain why the FCC continues to skip over the Brand X majority opinion in formulating its policy.
If the FCC finds, for the first time, that Internet access as it is commonly offered, consists of both an information service and a telecommunications service, that finding would implicate the services of all “non-facilities-based” information service providers. All future classification decisions would have to consider whether a service comprises separate offers of “a pizza” and “delivery,” or a single offer of “pizza delivery.”
While the FCC may say that its fingers are in its ears and it’s just not going to think about this problem, that’s got to be cold comfort for any entity that buys Internet access and uses it to deliver digital goods and services, not to mention anyone contemplating investment.
