DOJ Sues to Overturn California Net Neutrality Law

By Jerri-Lynn Scofield, who has worked as a securities lawyer and a derivatives trader. She is currently writing a book about textile artisans.

The Department of Justice (DoJ) yesterday filed a lawsuit against the state of California alleging that its Senate Bill 822, which would restore net neutrality and was signed into law earlier during the day by Governor Jerry Brown, “unlawfully imposes burdens on the Federal Government’s deregulatory approach to the Internet,” according to a DoJ press release.

The California bill is one of several state measures to roll back the Federal Communications Commission’s (FCC) 2017 decision to scupper net neutrality. At least half of US states have introduced bills restoring net neutrality and three states —Oregon, Vermont, and Washington— have already enacted legislation. Governors in six states– —Hawaii, New Jersey, New York, Montana, Rhode Island, Vermont—  have signed executive orders to this effect, according to the National Conference of State Legislatures.

The Los Angeles Times in California enacts strongest net neutrality protections in the nation — and the Trump administration sues summarized the California measure:

Experts have said the new law would impose the toughest net neutrality regulations in the country by reinstating the rolled-back federal regulations at the state level. It tasks the state attorney general with evaluating potential evasion of the net neutrality rules.

It also adds new restrictions on some zero-rated data plans, package deals that allow companies such as Verizon or Comcast to exempt some calls, texts or other content from counting against a customer’s data plan. Those limits prohibit plans that exempt content from some companies but not the same type of content from others — video streamed on YouTube but not Hulu, for example.

The California law goes farther than the previously existing federal net neutrality rules on zero rating, and, according, to The Verge in Trump administration sues California over tough net neutrality law:

Zero-rating is an area that has proved particularly divisive. The Obama era’s net neutrality rules did not explicitly ban the practice (it left it open for further study), but California’s new legislation does. Although Pai claims that zero-rating is popular amongst “lower-income Americans,” others argue that it gives incumbent internet services an unfair market advantage, while letting internet providers pick the winners and losers. In other words, what chance does a new streaming media service have if internet providers can bundle free access to Netflix without it impacting users’ data caps?

Trump Administration Policy: Bring It On

Attorney General Jeff Sessions issued the following statement yesterday, according to the DoJ:

“Under the Constitution, states do not regulate interstate commerce—the federal government does. Once again the California legislature has enacted an extreme and illegal state law attempting to frustrate federal policy. The Justice Department should not have to spend valuable time and resources to file this suit today, but we have a duty to defend the prerogatives of the federal government and protect our Constitutional order.  We will do so with vigor. We are confident that we will prevail in this case—because the facts are on our side.”

And FCC Chairman Ajit Pai also had his say, according to the DoJ:

“I’m pleased the Department of Justice has filed this suit. The Internet is inherently an interstate information service. As such, only the federal government can set policy in this area. And the U.S. Court of Appeals for the Eighth Circuit recently reaffirmed that state regulation of information services is preempted by federal law.

“Not only is California’s Internet regulation law illegal, it also hurts consumers. The law prohibits many free-data plans, which allow consumers to stream video, music, and the like exempt from any data limits. They have proven enormously popular in the marketplace, especially among lower-income Americans. But notwithstanding the consumer benefits, this state law bans them.

“The Internet is free and open today, and it will continue to be under the light-touch protections of the FCC’s Restoring Internet Freedom Order.  I look forward to working with my colleagues and the Department of Justice to ensure the Internet remains ‘unfettered by Federal or State regulation,’ as federal law requires, and the domain of engineers, entrepreneurs, and technologists, not lawyers and bureaucrats.”

Other Lawsuits

In addition to the latest DoJ action, broadband providers are expected separately to sue states– including California– that enact their own net neutrality rules, the New York Times reports in Justice Department Sues to Stop California Net Neutrality Law:

USTelecom, a trade group representing big broadband providers such as Verizon and Charter, criticized the rules for creating separate rules for California and other states. The group did not reply to questions on immediate plans for a lawsuit but several industry officials say the state rules are likely to be challenged.

And in January, California and other states sued the federal government over the repeal of the federal net neutrality rules. Amazon and Facebook have filed brief s in support of the states’ lawsuits, according to the LA Times.

Back to Congress?

Congress will certainly revisit the net neutrality issue– especially if Democrats capture either chamber in the mid-terms (see my previous post, Net Neutrality: FCC’s Scuppering Will Stand; Meanwhile, India Adopts World’s Most Sweeping Protections).  Currently, a resolution seeking to restore net neutrality nationwide has passed the House, but is considered unlikely to clear the House, Politico reports in Trump administration sues California over net neutrality law.

Telecoms providers– which benefit from the FCC’s December 2017 repeal– might support tossing the issue back to Congress, according to the New York Times:

“Rather than 50 states stepping in with their own conflicting open internet solutions, we need Congress to step up with a national framework for the whole internet ecosystem and resolve this issue once and for all,” Jonathan Spalter, the president of USTelecom, said in a statement.

And in fact, some Democrats have also endorsed this scenario, according to Politico:

Sensing a winning political issue, congressional Democrats have spotlighted the state’s net neutrality efforts. House Minority Leader Nancy Pelosi had urged Brown to sign the bill and predicted it could lend critical leverage to federal lawmakers.

“Once we establish California as a model of a state taking action, other states may follow, and then I think you may see some of corporate America say ‘OK, let’s have a federal law, because we don’t want to have to do different things in different states,’” Pelosi said at a recent press conference in San Francisco.

So, the saga continues. Pass the popcorn.

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37 comments

  1. TimH

    Got to love the sheer nastiness of Pai’s statement: “The law prohibits many free-data plans, which allow consumers to stream video, music, and the like exempt from any data limits”.

    Yes, Ajit, but that’s because FCC has allowed these (artificially low) data limits in the first place.

    Reply
    1. False Solace

      The crass manipulation of language in order deceive is a sign of our corrupt-to-the-core era. Pai allows giant unaccountable monopolies to control the internet… because it’s good for the poors!

      Pai is just another careerist sellout who has been bought. He cares about his wallet first and the People he’s supposed to serve second. If there were justice in this country he would be in prison. Paying someone off with a cushy job after they’ve done your bidding is still a bribe.

      Reply
  2. The Rev Kev

    So the Department of Justice is suing to overturn California’s Net Neutrality Law. If memory serves me right, Silicon Valley is located in California and has some of the biggest tech firms on the planet. It would be a real shame that if the Federal Government, particularly the Department of Justice, suddenly found that their internet had been throttled back to dial-up speeds because ‘markets’. This is after all what the internet is supposed to look like after net neutrality was trashed. Is there any sort of guarantee that the government must always get the fastest internet possible?

    Reply
    1. Lukas Bauer

      If push comes to shove the federal government knows where the silicone Valley guys live.

      But that’s a confrontation for another decade.

      Probably.

      Reply
  3. John Wright

    I wonder if any conservative “states rights” advocates will rush to the defense of blue California?

    Why not have different regulations in different states, a state of 40million such as CA would be a good test case to gather evidence for net neutrality’s good/bad effects?

    States Rights, bring them on

    Reply
    1. Epistrophy

      Jurisdiction over interstate commerce is pretty clearly defined in law. I think that the DOJ is going to win this one. California and Silicon Valley cannot rule over the other 49 states – no matter how much Jerry Brown wishes it.

      The real threat to net neutrality is the power of Silicon Valley; particularly the likes of Alphabet and Amazon. Nobody, at the moment, seems to be addressing this issue. Obama’s net neutrality simply codified the status quo – but the status quo is failing.

      Reply
      1. False Solace

        States pass laws about insurance and banking all the time and it somehow isn’t “interstate commerce”. Fortunately for Comcast and all the other unaccountable monopolists, the Supreme Court is already firmly in their pocket. No need to wait for Kavanaugh.

        Reply
      2. kgw

        Perhaps not…The FCC said it had no authority to regulate this issue, if so, that means the states get to do it. I read comments from a legal view on this particular HUGE issue.

        Reply
      3. d

        i was reading that some said that since the FCC said they couldnt regulate the internet, that they have basically no standing to complain when a state steps in. and the feds will loose because of how they terminated net neutrality.

        Reply
      4. Ginavon

        Jerry Brown used to be awesome….but now…Jerry brown is a criminal. He know the Orville dam is dangerously weak and yet does nothing to fix it. Perhaps he is saving it for one giant false flag event that will kill millions? Being conservative while living in California is hell. Diane Fiendstein used to be awesome but now….she is a criminal. She has a Chinese spy working in her office for 20 years….China has been planting spy chips in our computers and phones and her husband has made millions in China. She was recently seen in a car in a province of China that makes the chips. Kamala Harris used to be awesome. Recently, She has devolved into another left wing illogical person as evidenced by the Kavanaugh fiasco. The Democrat party has 30 yes THIRTY X CIA EMPLOYEES RUNNING IN 2018 midterms across the country. The Democratic Party has been taken over by national socialists and if you know your history you know what that means. They are using the exact same playbook. If you vote Democrat you will cry in your soup because you did not know 1/1000000000000 th of what is actually going on.

        Reply
        1. Outis Philalithopoulos

          Is the bit about “national socialists” a rhetorical flourish based on Jonah Goldberg’s “Liberal Fascism”? Regardless, it is pretty distracting to use something like that as a throwaway line.

          Reply
    2. Big Tap

      For Conservatives “states rights” only matter when the Democrats control Washington. Otherwise it’s no problem. Don’t hear much about that ‘jack boot on your neck’ stuff either anymore. Sessions was for “states rights” until he started working in the Executive branch. Same logic above applies to states controlled by Republicans.

      Reply
    1. Jerri-Lynn Scofield Post author

      Excellent point– and one I’d intended to include in the post, but neglected to do so. So thanks for raising the issue.

      Reply
    2. Bobby Gladd

      Soon-to-be SCOTUS Justice Kavanaugh wrote in a 2015 appellate dissent that ‘net neutrality impermissibly infringes on the First Amendment “free speech” rights of ISP’s, specifically their rights of “editorial discretion.”

      Reply
      1. False Solace

        Which is really weird because under the DMCA, ISPs were explicitly granted an exemption from copyright / libel laws because they have no “editorial discretion” and are simply dumb pipes that transmit data.

        Sort of like the FCC saying they have no jurisdiction to regulate ISPs, and now claiming California doesn’t either. Well, gee. It would be really nice if there were some sort of organization that could handle that. Sort of like a government, but it would look after the People and our needs instead of the greed-soaked whims of fictitious legal entities.

        Reply
  4. Carolinian

    But, without defending the FCC, isn’t Sessions right that this is an interstate commerce issue?

    For that matter isn’t the FCC itself a congressional issue? Surely the correct solution is for Congress to step in and save the internet. Not that I’m holding my breath, but in the past assaults on the web have been blocked by widespread public opposition. Clearly the congresspeople themselves know absolutely nothing about the “series of tubes.”

    Reply
    1. Epistrophy

      Clearly the congresspeople themselves know absolutely nothing about the “series of tubes.”

      One would say it is a generational thing, but it is not. Tim Berners-Lee being of the boomer generation, for example. No, it is a stupidity thing. There are simply too many ‘congresspeople’ who are as useless as a box of rocks, I fear.

      Reply
      1. Pat

        I think that is forgiving Congress their trespasses. They are not dumb, they are greedy. IF Google and Microsoft and Amazon really wanted Net Neutrality, there would be Net Neutrality. Why? Because they are the deepest pockets on the block where this is concerned. Pai might be Verizon’s boy, but Congress is for sale for the biggest bidder. And that includes all the Republicans.

        No, they have theirs AND they have the means to negotiate with the ISPs. It is the smaller vendors and start ups that don’t have any of that. And if you haven’t noticed, none of those big Silicone Valley folks are really into competition anymore.

        I wish I did think they were in the right place where all of this is concerned, but I think they will do the bare minimum to help California fight this, and not demand it of anyone they really back in Congress.

        Reply
      1. Unna

        Don’t ask me for specifics but it’s my impression that the Federal Preemption Doctrine has become more of a weapon in the corporatist toolkit in recent times. Think it was applied to “preempt” state regulation placing limits on permissable interest rates. You know, for the bankers. But this is not my line.

        Reply
  5. Arizona Slim

    I know that the word “innovation” has turned into quite the punching bag, but I can’t help thinking that it could make corporate ISPs irrelevant. Things like community broadband and mesh networks come to mind.

    Reply
    1. Carolinian

      As I understand it this argument is mostly about cell tower internet–the subject of that CA firefighter dispute. I’m not aware of any usage caps on cable or fiber internet although happy to be corrected. The cable companies were placing very high caps to deter the people who do nothing but download movies all day (or, alternately, to force them into a more expensive plan). But on true broadband plans, as opposed to iphone cell internet contracts, zero rating would surely not be an issue unless the ISPs were looking to set up a true tollgate, per website system which they’ve sworn they are not going to do.

      When it comes to broadband the real problem is the grotesque lack of competition. There was an article the other day about how the FCC fakes the competition statistics (sorry don’t have a link). About half the states place limits on how local communities can compete with commercial providers of internet.

      Reply
      1. Pat

        The various broadband companies have been slowly rolling out broadband caps for the last few years.
        It is not general yet, but I fully expect it to be before the next Presidential election. Too many of the ISPs are also cable operators.

        Reply
      2. Grebo

        Net neutrality is much broader than just usage caps. In fact caps are an orthogonal issue.

        In a neutral network the packets I put in will reach their destination “without let or hindrance”, as my passport says, and likewise the responses. ISPs are not allowed to block, filter, throttle, divert, modify or delay them, except for legitimate technical reasons. Nor can they charge differently (or twice!) according to their destination or content.

        ISPs would love to do all those things but it would kill the internet. It would become like cable TV, which non-numpties are already leaving in droves–for the internet.

        Reply
        1. Carolinian

          I’m not sure ISPs would love to do those things. They probably would prefer the current system where all customers pay the same high fee for broadband-ish internet whether they live on the web or only do email.

          However with many traditional providers being cable companies and cable subscriptions being on the decline as people turn to streaming you never know. One problem with this scenario is that on the internet the culture of “free” is deeply ingrained. Customer resistance to paying for access to websites would be considerable. If the ISPs put the slows on free sites then there are other options that rebellious customers can employ. For ISPs it’s easier to just overcharge for getting on the web at all than the complications of some elaborate scheme.

          Which is why the dispute really seems to boil down to cell phone networks like ATT and Verizon. They have always been the ones leading the charge to kill net neutrality.

          Reply
          1. Grebo

            And Comcast. The ISPs have already complained that Netflix, Google etc. are getting a ‘free’ ride on them, ignoring the fact that those companies pay for their access too.
            They have already been caught throttling Netflix and refusing to let Netflix address their ‘concerns’.
            Any site that gets a lot of traffic, they want a cut. Or they’ll divert you to their own rival ‘service’.
            They will do anything and everything they can think of to screw more money out of us, no matter how we connect.

            But the money is less important than the freedom to access any information you choose. Without net neutrality the ISPs could decide to block every site on the PropOrNot list, or anything else they or the government don’t like.
            Want to use gmail? Sorry we only support our special email service which tags an ad on to all your emails. Only $9.99 for the first month.
            You want to host your own email server? What are you, some kind of terrorist?
            Every web page you visit, they will make you click through an ad first, one that pays them not the website. If you spend more than 2 minutes reading a page they will pop up an ad for you.
            Want to use tor, vpn, ssh, bittorent, nntp, voip… “Sorry, due to suspected criminal behaviour these protocols are no longer supported. Why not try our spiffy new service instead?”

            I don’t live in the US but I have experienced all this sort of thing from my local ISP. Fortunately it has been slowly improving since it was nationalised.

            Reply
            1. Carolinian

              All fair points but since there is still at least a tiny bit of competition in the internet market then ISPs do have to worry about their competitors not doing those things and all their customers flocking to the other company.

              The reality is that we’ve had ISPs for many years and formal net neutrality for only a couple of years under Obama and yet the ISPs (other than the cellphone companies) have maintained more or less the same business model all that time. That’s because they’ve been making money hand over fist for providing a wire to the internet and not even, as the cable tv people do, having to pay for the content. Internet is a huge cash cow for outfits like Comcast. So mostly–at least so far–the attitude seems to be don’t rock the boat. For the cell companies it’s different because of the infrastructure, the cell tower leases etc.

              At least that’s my understanding of the situation. Sites like Torrenfreak love to complain about traditional ISPs and their practices but then many of their readers are little more than download pipes to the internet or 24/7 gamers.

              Reply
    2. False Solace

      Thanks to our bought-and-paid-for politicians, 20 states now have laws outlawing municipal ISPs. Hooray for freedom in the land of the almighty dollar! The best government money can buy.

      Reply
  6. djrichard

    What’s interesting to me is how many people in the comments section on Yahoo news are carrying water for the ISPs. I have to imagine a good chunk of it is paid commenting. I mean who the heck can get energized enough on this issue to go to bat for the ISPs?

    Reply
    1. Eureka Springs

      Doesn’t Verizon own Yahoo now?

      And you reminded me of the time Comcast let a bunch of employees off to go protest at airports.

      Reply
  7. kgw

    In case you missed it above:

    Perhaps not…The FCC said it had no authority to regulate this issue, if so, that means the states get to do it. I read comments from a legal view on this particular HUGE issue.

    Reply

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