[Infowarrior] - Court: FCC has no power to regulate Net neutrality

[Richard Forno]

  April 6, 2010 8:15 AM PDT
Court: FCC has no power to regulate Net neutrality
by Declan McCullagh
http://news.cnet.com/8301-13578_3-20001825-38.html
The Federal Communications Commission does not have the legal  
authority to slap Net neutrality regulations on Internet providers, a  
federal appeals court ruled Tuesday.

A three-judge panel in Washington, D.C. unanimously tossed out the  
FCC's August 2008 cease and desist order against Comcast, which had  
taken measures to slow BitTorrent transfers and had voluntarily ended  
them earlier that year.

Because the FCC "has failed to tie its assertion" of regulatory  
authority to any actual law enacted by Congress, the agency does not  
have the authority to regulate an Internet provider's network  
management practices, wrote Judge David Tatel of the U.S. Court of  
Appeals for the D.C. Circuit.

Tuesday's decision could doom one of the signature initiatives of  
current FCC Chairman Julius Genachowski, a Democrat. Last October,  
Genachowski announced plans to begin drafting a formal set of Net  
neutrality rules -- even though Congress has not given the agency  
permission to begin. (Verizon Communications CEO Ivan Seidenberg, for  
instance, has said that new regulations would stifle innovative  
technologies like telemedicine.)

Even though liberal advocacy groups had urged the FCC to take action  
against Comcast, the agency's vote to proceed was a narrow 3-2, with  
the dissenting commissioners predicting at the time that it would not  
hold up in court. FCC Commissioner Robert McDowell, a Republican, said  
at the time that the FCC's ruling was unlawful and the lack of legal  
authority "is sure to doom this order on appeal."

The ruling also is likely to shift the debate to whether Congress will  
choose to explicitly grant the FCC the authority to regulate  
companies' network management practices. It will also likely revive  
lobbying coalitions that have been defunct for the last few years.

In 2006, Congress rejected five bills, backed by groups including  
Google, Amazon.com, Free Press, and Public Knowledge, that would have  
handed the FCC the power to police Net neutrality violations. Even  
though the Democrats have enjoyed a majority on Capitol Hill since  
2007, the political leadership has shown little interest in  
resuscitating those proposals.

"We must decide whether the Federal Communications Commission has  
authority to regulate an Internet service provider's network  
management practices," Tatel wrote in his 36-page opinion. "The  
Commission may exercise this 'ancillary' authority only if it  
demonstrates that its action--here barring Comcast from interfering  
with its customers' use of peer-to-peer networking applications--is  
'reasonably ancillary to the...effective performance of its  
statutorily mandated responsibilities.'"

In August 2005, the FCC adopted a set of principles saying "consumers  
are entitled to run applications and use services of their choice."  
But the principles also permit providers' "reasonable network  
management" and, confusingly, the FCC admitted on the day of their  
adoption that the guidelines "are not enforceable."

The FCC's 2008 vote to punish Comcast stems from a request from Free  
Press and its political allies, including some Yale, Harvard, and  
Stanford law school faculty. They claim the FCC has the authority-- 
under existing law--to "impose additional regulations" declaring  
Comcast's throttling to be illegal.

This is not the first time that the FCC has been rebuked for enacting  
regulations without any actual legal authority to do so. In 2005, D.C.  
Circuit ruled the agency did not have the authority to draft its so- 
called broadcast flag rule. And a federal appeals court in  
Pennsylvania ruled in the Janet Jackson nipple exposure incident that  
the FCC's sanctions against CBS--which publishes CNET News--amounted  
to an "arbitrary and capricious change of policy."

Update at 9:15 a.m. PDT: History and more details added.