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Supremes Yield to FCC on Shot-Clock Call - Multichannel

Supremes Yield to FCC on Shot-Clock Call

High Court Says Agency Was Within Its Authority On Tower-Sitting Rule
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WASHINGTON — Cable operators won a legal victory of sorts in the U.S. Supreme Court last week, but it is one that could provide fodder for the Federal Communications Commission’s defense of its network neutrality order.

The Supreme Court on May 17 held that a court must give “Chevron deference” to an agency’s interpretation of an ambiguity in a statute over the limits of its authority.

In this case, it was the Federal Communications Commission’s assertion that it had the broad regulatory authority to impose a shot clock on local government approval of communications tower siting applications.

The FCC is trying to speed broadband deployment by goosing decisions by localities, something both cable and wireless operators support.

The FCC and the solicitor general’s office argued that the Chevron test does apply to an agency’s authority and has been relied on for decades as a framework for reviewing an agency’s interpretation of ambiguous language.

APPROACH TO AMBIGUITY

The Chevron test (which stems from a 1984 Supreme Court decision in Chevron USA, Inc. vs. Natural Resources Defense Council) holds that if a statute is ambiguous, the appeals court must defer to a government agency’s reasonable interpretation of that law, even if it diverges from any decision the court might have reached on its own. The thought is that the agency by its very nature brings special subject matter expertise and the balancing of competing policy interests to its decisions.

Verizon Communications, which continues to challenge the Open Internet order in court — MetroPCS dropped its suit two weeks ago, after the company was bought by Sprint Nextel — had filed a brief with the Supreme Court in support of the challenge by the cities of Arlington and San Antonio, Texas, to the U.S. Court of Appeals for the 5th Circuit. The 5th Circuit had ruled that the FCC was due that Chevron deference, even though it supported the agency’s decision to subject tower siting to a so-called shot clock deadline.

Verizon actually wanted the tower-siting ruling to stand, arguing that the FCC had express authority for that. But the telco supported the cities’ challenge to the more general issue of Chevron deference to an agency’s interpretation of the limits of its own authority.

The FCC’s interpretation of its authority is central to Verizon’s challenge to the FCC’s Open Internet order, which Verizon argues exceeds the agency’s authority. That 2010 order mainly puts nondiscrimination and other access requirements on wired broadband providers, but the FCC did include a provision prohibiting the blocking of lawful data traffic that it also applied to wireless companies.

In such a case, where a court is reviewing an agency decision, the Supreme Court said last week, it is always about whether the agency strayed beyond the statute.

“When a court reviews an agency’s interpretation of a statute it administers, the question is always, simply, whether the agency has stayed within the bounds of its statutory authority,” the court said. “There is no distinction between an agency’s ‘jurisdictional’ and ‘nonjurisdictional’ interpretations … Because the question is always whether the agency has gone beyond what Congress has permitted it to do, there is no principled basis for carving out an arbitrary subset of ‘jurisdictional’ questions from the Chevron framework.”

VERIZON’S APPEALING

The U.S. Court of Appeals for the D.C. Circuit has not yet scheduled oral argument in Verizon’s challenge to the Open Internet rules, and is now not expected to until the fall. Last week, the FCC cited the Supreme Court decision to the D.C. Circuit to buttress its case that it has the broad authority under statute to regulate Internet access along the lines of its network-neutrality rules.

Scott Cleland, an analyst with consulting company Precursor, said he does not think the tower-siting decision will undercut Verizon’s argument. “I believe Verizon is still more likely than not to prevail on the merits of its appeal, because the FCC’s Open Internet Order is so unambiguously far outside the bounds of the FCC’s statutory authority, that Chevron deference is unlikely to apply,” he said in a blog posting.

The FCC is making a similar case in proposing that it has the power to regulate the supply chain for Internetservice providers.

TAKEAWAY

The Supreme Court’s ruling on “Chevron deference” may provide the FCC with legal ammo to stave off a threat to its Open Internet regime.

WASHINGTON — Cable operators won a legal victory of sorts in the U.S. Supreme Court last week, but it is one that could provide fodder for the Federal Communications Commission’s defense of its network neutrality order.

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