Title II "Net Neutrality" Broadband Rules Would Breach Major Questions Doctrine. (Communications Act of 1934)

• Date: 01 May 2024
• Author: Verrilli, Donald B., Jr.,Gershengorn, Ian Heath

TABLE OF CONTENTS
                I. INTRODUCTION 322
                II. THE SUPREME COURT'S ARTICULATION OF THE MAJOR QUESTIONS 323
                 DOCTRINE
                III. UNDER BINDING SUPREME COURT PRECEDENT, THE COMMISSION LACKS 330
                 AUTHORITY TO RECLASSIFY BROADBAND AS A TITLE II SERVICE
                 A. Classification of broadband as a Title II service subject 330
                 to utility-style regulation implicates a major question
                 B. The Commission lacks clear statutory authority to 333
                 reclassify broadband under Title II
                 C. Brand X is not to the contrary 334
                 D. The Commission's invocation of regulatory concerns beyond 335
                 net-neutrality would not change the major questions
                 outcome
                IV. GIVEN THE LACK OF CLEAR AUTHORITY, THE COMMISSION SHOULD NOT 336
                 PROCEED TO REGULATE BROADBAND UNDER TITLE II
                V. CONCLUSION 337
                

I. INTRODUCTION

The Federal Communications Commission (the Commission) is once again considering how broadband Internet access service should be regulated. (1) The goal of enacting core open Internet principles so that all consumers can enjoy free and unimpeded access to lawful Internet content of their choosing is laudable. The key question, however, is who gets to decide how such principles should be translated into law. As it has before, the Commission wants to take that responsibility for itself. The Commission proposes to treat broadband service as though it were a traditional common carrier service and subject it to the same regulatory regime under Title II of the Communications Act of 1934 that has historically governed basic telephone service. But that would be wasted effort. Any attempt by the Commission to impose such broad regulatory requirements under current statutes would be struck down by the Supreme Court. And the contentious litigation leading to that inevitable result would waste countless resources for the government, industry, and the public while distracting all parties from more promising efforts, such as obtaining congressional action to resolve these important issues. The Commission should not go down that path.

Consider first the law. The Supreme Court is likely to invalidate any attempt by the Commission to impose Title II regulation on broadband Internet access service. As the last two Terms have made clear, the major questions doctrine is here to stay, and that doctrine resolves this case. The Supreme Court will surely consider the question of whether to classify broadband as a Title II telecommunications service subject to common carrier regulation to be a "major question"--that is, one involving a matter of major economic and political significance. As then-Judge Kavanaugh noted, that proposition is "indisputable," and "any other conclusion would fail the straight-face test." The Court has made crystal clear that when a federal agency seeks to address a major question, the agency must have "clear congressional authorization" for the regulations it imposes. The statutory text on which the Commission proposes to hang its hat lacks the clear statement of authority that the Supreme Court demands. Nothing in Title II of the Communications Act itself or in any other statute gives the Commission the clear and unambiguous authority to classify broadband as a Title II telecommunications service subject to common carrier regulation, and the Commission cannot reasonably conclude otherwise.

We recognize that the Commission determined in 2015 that it had the authority to reclassify broadband Internet access services as Title II telecommunications services, (2) and the D.C. Circuit upheld that determination. (3) The Commission, however, can take little solace from that ruling. The Supreme Court never got to consider the lawfulness of the Commission's 2015 decision, and the Commission rescinded that decision and abandoned the Title II approach to broadband regulation in 2018. The Supreme Court's commitment to the major questions doctrine has intensified in the years since the D.C. Circuit's ruling, as the high court's recent decision reaffirming the doctrine in West Virginia v. EPA makes clear. Even at the time, it was clear to then-Judge Kavanaugh that the panel's ruling upholding the Commission's classification decision was foreclosed by the major questions doctrine. (4) There is every reason to think that the views Judge Kavanaugh expressed would command a majority on the Supreme Court today.

Given that legal reality, the Commission's proposal to reclassify broadband as a Title II telecommunications service is a serious mistake that will ultimately fail, and at great cost. The administrative proceedings to develop the new regime will require a massive commitment of resources from the government and private parties alike, and the ensuing court challenges will do the same. Moving ahead in this way thus would distract the Commission from its other priorities--ones fully within the scope of its congressional authority. Moreover, as a practical matter, the Commission's actions will prevent the parties from focusing on the real solution here: crafting legislation that will provide a clear and stable framework for broadband regulation. Only that approach will provide a solution that survives changes to the political make-up of the Commission and does so in a way that the Supreme Court could uphold.

To be sure, the wisdom and propriety of the Supreme Court's major questions doctrine is a matter of debate. Some (including both of us) believe that the Court has gone too far in restricting federal agency authority to meet new and pressing challenges. But like it or not, a robust major questions doctrine is now a fact of regulatory life. A Commission decision reclassifying broadband as a Title II telecommunications service will not survive a Supreme Court encounter with the major questions doctrine. It would be folly for the Commission and Congress to assume otherwise.

II. THE SUPREME COURT'S ARTICULATION OF THE MAJOR QUESTIONS DOCTRINE

The Supreme Court's understanding of the appropriate relationship between federal administrative agencies and the judiciary has undergone a sea change over the past two decades. Federal agencies can no longer expect to receive substantial deference from the courts when they interpret statutory provisions defining the nature and scope of their regulatory authority, particularly when they pursue expansive or creative interpretations of statutes to adopt rules of major consequence. Whether or not the Supreme Court formally overrules Chevron, (5) the days in which federal courts uncritically uphold any reasonable agency interpretation of the statute it administers are over. The Court has not upheld an agency action on the basis of Chevron deference in almost a decade. When the Court reviews federal agency action for conformity to law, it routinely decides for itself what the statute means. And the Supreme Court has not hesitated to invalidate agency actions that lower courts have upheld under Chevron when the Court concludes that the agency's course of action cannot be reconciled with the most straightforward reading of the relevant statute. (6) In systematic fashion, the Court is reclaiming the primary authority to determine the meaning of the statutes that federal agencies implement.

Perhaps the most powerful manifestation of this reconfigured relationship between the courts and administrative agencies is the "major questions doctrine." The Court has rooted the doctrine in the Constitution's separation of powers, which the Court has understood to mean that policy choices about matters of great economic and political significance should be made by the democratically accountable Congress in the exercise of its Constitutional authority to make the nation's laws, and not by unaccountable administrative agencies acting under the purported authority of ambiguous statutes. To implement that principle, the Supreme Court has made clear, and emphatically reaffirmed this year, that an administrative agency does not possess the authority to promulgate rules addressing matters of great economic and political significance unless Congress has provided "clear congressional authorization" for such rules. (7) Importantly, the Court has not said merely that it will decide for itself whether ambiguous statutory text is best read as giving the agency the authority to resolve the major question in the manner that the agency has. It has gone a good deal further. If the statute invoked by the agency lacks a clear congressional authorization for agency action on a major question, then the agency lacks the authority to act at all. Put simply, if the statute is not unambiguous, a reviewing court must invalidate the agency policy. (8)

The major questions doctrine has been gathering steam since at least the Court's 2000 decision in FDA v. Brown & Williamson Tobacco Corporation (9) In that case, the Court invalidated the FDA's decision in the 1990s to regulate tobacco products as drugs. The statutory text of the Food, Drug and Cosmetics Act defined "drugs" and "devices" subject to the FDA's jurisdiction in a manner that could reasonably be read as covering tobacco products. But the Court refused to defer to the FDA's reading of the terms, 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." (10) Instead, the Court looked to the overall structure of the statutory scheme, a fifty-year history of the FDA's leaving tobacco unregulated, and the fact that Congress had enacted numerous pieces of legislation "addressing the problem of tobacco use and human health" without ever suggesting that the FDA had regulatory authority over tobacco products. Based on those considerations, the Court concluded that it was "clear... that Congress ha[d] precluded the FDA from regulating tobacco products." (11) The Court was unwilling to accept that Congress left it to the agency's discretion to determine whether to take a step with such vast "economic and...