Justice Gorsuch and Net Neutrality

Nobody seems to have pointed this out yet, so I guess I might as well put something up quick.

President Trump is not a big fan of net neutrality, and his new FCC commissioner, Ajit Pai, is, uh… really not a fan. Mr. Pai is already working on rolling back the FCC’s net neutrality rules, which were passed under President Obama. Most conservatives agree with Trump. Judge Gorsuch, of course, is a conservative nominee appointed by an anti-net neutrality president. So the going assumption is that Gorsuch will hurt the cause of net neutrality if confirmed to the Supreme Court. That he will not protect the open internet.

This is a mistake.

“Net neutrality,” for those of you who have never read my gigantic posts about it, is the principle that internet service providers (such as Comcast) have to allow their users equal access to the entire Internet. Under net neutrality, Comcast can have its own video service that competes with YouTube, but it cannot block YouTube from its network to force you (the Comcast subscriber) to use the Comcast video service. Nor can it treat its videos differently from YouTube videos as they travel down the wire to your computer: you get both videos as fast as possible, based on whatever data rate you are paying for. Nor can Comcast force YouTube to pay extra to connect with its network. And so forth.

This is a fundamental architectural principle of the Internet. It was the law of the land for the Internet’s early, formative years, and I explain why it is still necessary today at absurd length in my two previous articles on the subject: “A Sorta-Technical Overview” and “Why Free Marketeers Want to Regulate the Internet.” Vint Cerf called the second one a “must read,” and I can die happy knowing that. I’m not going to explain it further here.* It’s time to talk about Gorsuch.

No, wait, it’s time to talk about the Brand X.

On the Internet, there are two kinds of provider. There are content providers like Google and Netflix and… well, this blog. We create stuff that people want to see and we put it on the wires. Then there are Internet Service Providers (ISP), like Comcast and CenturyLink, which actually own the wires.

When the Internet was first created, the ISPs were regulated as “common carriers,” like phones and airlines. Phones and airlines have to sell bandwidth (or seats) to any customer who has the money to pay, without discrimination, just as a net-neutral ISP has to carry content for any customer with money to pay, without discrimination. If you think that sounds a lot like net neutrality, you’re right.** For early ISPs working under this regulatory regime, net neutrality was “baked in” by pre-existing laws originally written for phone companies.

In 1996, Newt Gingrich’s Congress passed a law (which President Clinton signed) reforming telecommunications regulation for the Internet Age. Although Republicans love deregulating things, their reforms left the common-carriage requirements on ISPs untouched. The Republicans opened up a lot of space for content providers, and they tried to create competition in the ISP market, but they retained the essential protections of the original Telecommunications Act. ISPs would continue to operate as common carriers for many years to come, through the entire ’90s tech boom and well into the post-bust recovery.

Then, in 2002, George W. Bush’s did something very strange. All of a sudden, they radically re-interpreted the Telecommunications Act. Their new opinion, they announced, was that ISPs actually were not a telecommunications service after all. This meant the FCC could no longer regulate ISPs as common carriers. Since ISPs were no longer common carriers, net neutrality was no longer the law of the land. It became a mere option… one which the ISPs were quick to abandon and abuse.

Worse: this wasn’t some well-meaning attempt to correct the improper enforcement of the law. To put it charitably, the FCC’s legal reasoning for this conclusion was garbage. It was, in fact, a bald-faced attempt by the Bush White House to deregulate ISPs without going through Congress–and everyone admitted this, including the FCC.

There was, of course, a lawsuit. A small ISP called Brand X Internet, which needed common carrier treatment to move its traffic through other (larger) networks, was going to be wiped out by (now legal) monopolistic practices of other, larger ISPs. Brand X sued the FCC, among others, for violating the Telecommunications Act of 1996, which, as previously stated, required ISPs to be treated as common carriers.

The case was called National Cable & Telecommunications v. Brand X, and it went all the way to the Supreme Court in 2005. It ended up hinging on a strange legal doctrine called Chevron Deference.

Named for a regulatory case from the 1980s, Chevron v. Natural Resources Defense Council, the principle of Chevron deference says that the courts should not rely on their own interpretation of the law when the executive branch is involved. Instead, courts should defer, whenever possible, to the legal interpretations put forth by executive agencies like the EPA or the FCC.

When an executive agency comes up with a novel interpretation of a law, which happens a lot these days, courts ask two Chevron questions to decide whether to accept that interpretation. First, the court asks whether Congress has unambiguously addressed the issue in question (whatever it is). If there is no ambiguity, then the law of Congress must stand. However, if there is ambiguity–even a little– then the court decides whether the agency’s official interpretation is “permissible.” Not natural, not reasonable, not obvious… “permissible,” within the bounds of the English language. No matter how tortured the logic or the language, if the agency interpretation is “permissible,” then, Chevron says, the court must accept it.

In other words, if an executive agency can find even a small silver of ambiguity in a law passed by Congress, the agency can take that ambiguity, wedge a new ruling into it, and twist the language as much as they need to to achieve whatever policy goal they want, and to heck with Congress. Even if the agency’s interpretation runs pretty much contrary to every reasonable reading of the law, as long as it is technically permissible, the court has to accept it. That’s Chevron deference. (And, yes, there are theoretically limits on this agency power, but, in practice, it has given the executive branch vast power to do nearly anything it wants, regardless of what the law says.)

Okay, back to 2005 and Brand X.

The FCC ruling deregulating ISPs was a doozy. Everyone on the Supreme Court agreed that the ruling was not the most natural reading of the Telecommunications Act. In fact, the judicial branch had already previously ruled in other cases that another reading of the Telecommunications Act should be followed… one that preserved the common-carrier rules for ISPs.

However, the Supreme Court concluded, by a 6-3 majority, that the Telecommunications Act was just ambiguous enough to allow alternative interpretations, and the FCC’s ruling was just reasonable enough to qualify as a “permissible” construction in the English language. Therefore, under Chevron deference, the Court decided it had no choice but to accept the FCC ruling, even overturning the judicial system’s own prior rulings to support the FCC. Brand X lost, and the FCC’s deregulation went ahead. That was the beginning of the net neutrality battle.

Justice Scalia wrote a scathing dissent in Brand X. Justice Scalia was a conservative,  so he liked deregulating things as much as the next Republican, and he even agreed with Chevron deference in principle. But, Scalia insisted, the FCC ruling failed the Chevron test. The Telecommunications Act was unambiguous about regulating ISPs as common carriers, and, even if the Act were ambiguous, the FCC’s ruling was an absurd and totally impermissible re-interpretation of the law. Scalia may have liked the outcome (he didn’t say), but he argued–correctly–that the FCC had exceeded the authority granted to it by Congress… even under Chevron deference.

But Scalia was in the minority. Brand X lost. In the dozen years since, the FCC has dithered over ISP regulation, unable to make any ruling that sticks for more than a couple years at a time. Net neutrality has been eroding apace. Although it is not yet to the point where consumers are taking regular notice, it is already driving up consumer prices, as ISPs use network leverage to force services like Netflix to pay ransom money or lose access to its paying customers. All because of Chevron deference.

Now here comes Gorsuch. Here’s something Judge Gorsuch wrote last year, in a concurring opinion on a case (this one about immigration law) that also happened to hinge on Chevron deference:

There’s an elephant in the room with us today. We have studiously attempted to work our way around it and even left it unremarked. But the fact is Chevron and Brand X permit executive bureaucracies to swallow huge amounts of core judicial and legislative power and concentrate federal power in a way that seems more than a little difficult to square with the Constitution of the framers’ design. Maybe the time has come to face the behemoth…

[W]hat would happen in a world without Chevron? If this goliath of modern administrative law were to fall? Surely Congress could and would continue to pass statutes for executive agencies to enforce. And just as surely agencies could and would continue to offer guidance on how they intend to enforce those statutes. The only difference would be that courts would then fulfill their duty to exercise their independent judgment about what the law is. Of course, courts could and would consult agency views and apply the agency’s interpretation when it accords with the best reading of a statute. But de novo judicial review of the law’s meaning would limit the ability of an agency to alter and amend existing law. It would avoid the due process and equal protection problems of the kind documented in our decisions. It would promote reliance interests by allowing citizens to organize their affairs with some assurance that the rug will not be pulled from under them tomorrow, the next day, or after the next election. And an agency’s recourse for a judicial declaration of the law’s meaning that it dislikes would be precisely the recourse the Constitution prescribes — an appeal to higher judicial authority or a new law enacted consistent with bicameralism and presentment. We managed to live with the administrative state before Chevron. We could do it again. Put simply, it seems to me that in a world without Chevron very little would change — except perhaps the most important things.

These are the first and last paragraphs, respectively, of a carefully written, very polite, 23-page concurrence in which Gorsuch attacks Chevron deference at every level. In the end, Judge Gorsuch calls on the Supreme Court to reconsider and overturn Chevron entirely. This is noted by many people as a huge difference between Gorsuch and Scalia; Scalia was a staunch defender of Chevron, while Gorsuch is its most prominent opponent.

This has many implications, touching all sorts of issues, and it has lots of people on all sides talking–some hopefully, some fearfully. I won’t go into all that.

But what does it mean for net neutrality?

If Justice Gorsuch reaches the Supreme Court, he could lead a judicial movement to overturn or limit Chevron. Given his record on Chevron, this is widely expected, and Gorsuch will have a considerable amount of time to do it, since it’s a lifetime appointment.

Brand X is known for being such an extreme application of Chevron that practically any limitation of Chevron will lead to Brand X being overruled or drastically narrowed (although not necessarily immediately; the law moves slow). Gorsuch needs only be slightly successful in limiting Chevron to put Brand X at risk.

If Brand X were overturned, it would be very good news for net neutrality activists. The Telecommunications Act of 1996 is still on the books. It still, pretty unambiguously, demands that ISPs be regulated as common carriers. The FCC got around that with a bunch of legal argle-bargle that was confirmed valid by Brand X… but, if Brand X falls, so does the FCC’s justification for not regulating ISPs correctly.

In short, overturn Brand X and you bring back ’90s-era net neutrality. President Trump couldn’t stop it. The FCC couldn’t stop it. Al Gore couldn’t stop it. The only thing that could stop net neutrality at that point is Congress, and Congress has too many net neutrality advocates for a change in law to happen.

I haven’t the faintest idea what Judge Gorsuch thinks about the policy of network neutrality. He’s a conservative, so he may well oppose it (though I’d love to persuade him otherwise). But if there’s one common theme in Gorsuch’s work, it’s that he doesn’t rule for his favored policies; he rules for the law, whatever it may be.

This is very good news for net neutrality advocates, because, despite the last decade of silly legal acrobatics, the law is on our side. It always has been. That makes soon-to-be Justice Gorsuch a powerful ally.

Let’s hope his colleagues on the court are as open-minded to reconsidering bad precedents as he.

NOTES

*I still owe this guy a real reply, though, so rest assured I still have more to say about NN.

**This is not an exact analogy, but the alternative is that I spent six pages explaining how Title II of the Telecommunications Act works, and none of us wants that. Tim Wu more carefully defines net neutrality and their relationship with common carriage rules in his seminal paper on the subject.