NCTA's Big Guns Weigh In on Title II

Lawyers Confident of Overturning FCC's Ruling

The National Cable & Telecommunications Association's high-powered lawyers said Wednesday (June 3) they were confident the FCC's Title II reclassification of the Internet would be overturned by the court, and that that could happen with the baseline, bright-line rules remaining in effect.

Their comments came in a meeting with reporters featuring NCTA president Michael Powell, former solicitor general Ted Olson and former Supreme Court nominee Miguel Estrada.

Olson and Estrada tore into the FCC, saying it was trying to write new law, change policy without justification or notice, and otherwise run roughshod over the Congress, communications law and the Administrative Procedures Act, which set out the rules for how agencies regulate, with prohibitions on arbitrary and capricious decisionmaking.

They argued the cable and telco legal challenge was high-stakes, and one of the most important challenges -- the terms "monumental" was used -- to regulatory authority ever, given that it deals with the Internet's future. Olson talked of a suffocating FCC whose heavy hand of regulation would "stifle and strangle" innovation and investment.

They said the FCC switched from a Sec. 706-based approach that had talked about Title II in only two paragraphs, and even then only as a backstop, to its own version of Title II for the 21st Century, with 128 paragraphs outlining it. That, they added, did not square with APA guidelines that the public must be given notice of what the FCC is actually planning to do, and allowed to comment on it. They did not use the term bait and switch, but the suggestion was the FCC had signaled one thing, and done something entirely different without sufficient notice of the change.

Estrada said the FCC had overturned its previous conclusion, replacing it with a manifestly inconsistent one -- that broadband, rather than being an information service with, possibly, some telecommunications element in the last mile, was not an information service at all, a conclusion that could cause grave damage to the market, including investment.

They would not handicap their chances of getting a stay of the June 12 effective date of the FCC's new rules. They said they had made a strong case for irreparable harm if the court did not stay Title II, its pursuit of interconnection under Title II, and the Internet conduct standard. But they pointed out the D.C. Circuit has not provided much insight on what goes into its stay decisions, usually just releasing a line saying granted or denied.

But they said there would be irreparable harm, not only on the big stage, but for small operators who have never had to comply with the regulatory regime of Title II.

Estrada said that if the stay were denied -- the three-judge panel vetting that petition could issue a decision at any time but presumably before June 12 -- they would not likely appeal that denial. Powell added a caveat that he would not be held irretrievably to that, but said he agreed it was unlikely.

Estrada suggested that the earliest the court could rule, if it expedites the briefing and oral argument, would be early 2016 -- with oral argument in late 2015 or early 2016 and about three months for the court to come up with a decision.

Powell reiterated that the NCTA would prefer a legislative solution and even said he was still cautiously optimistic that could happen, adding he had been meeting with top congressional Democrats this week about the prospects.