State Net Neutrality Laws May Lead to Federal Legislation
Monday, March 1, 2021

A federal court decision last week will allow California to enforce its own net neutrality rules. As other states follow suit, the desire for a more uniform approach could lead to federal legislation clarifying the scope of FCC regulatory authority over broadband Internet access service.

On February 23, Judge John Mendez of the U.S. District Court for the Eastern District of California denied a motion by trade associations representing the Nation’s major broadband providers and wireless carriers to delay enforcement of California’s net neutrality law. This followed the U.S. Department of Justice (DoJ) February 8 decision to drop its lawsuit challenging California’s regulatory authority, in which the DoJ had argued that California’s net neutrality law is preempted by the Federal Communication Commission’s (FCC’s) Restoring Internet Freedom Order (notwithstanding that the FCC insisted in that Order that it had no regulatory authority over broadband).

California’s net neutrality law is perhaps the most comprehensive in the country, going beyond the FCC’s previous net neutrality rules (adopted in the 2015 Open Internet Order) by prohibiting the practice of “zero rating,” in which an Internet Service Provider (ISP) does not count certain allied services and applications against a user’s monthly data cap.

Now, broadband providers face the prospect of enforcement of California’s law, as well as the emergence and enforcement of net neutrality laws in other states. To date, seven states have adopted net neutrality laws (California, Colorado, Maine, New Jersey, Oregon, Vermont, and Washington), and several other states have introduced some form of net neutrality legislation in the 2021 legislative session (among them Connecticut, Kentucky, Missouri, New York, and South Carolina).

Faced with a patchwork of net neutrality rules, broadband trade associations may well conclude that a consistent set of rules is desirable. Federal legislation would likely be needed to accomplish this objective, especially if the California decision is affirmed on appeal. A federal legislative effort would almost certainly confront the larger question: what will be the FCC’s role with respect to broadband communications services? The Telecommunications Act of 1996, meanwhile, is increasingly long in the tooth.

 

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