Jurisdiction: The $64,000 Question
Release 5.12 November 2009
by Barbara Esbin*
View as PDF
Matthew Lasar asks the $64,000 question on Ars Technica:
"Did Congress really give the FCC power to protect the Net?" The answer, as I have written repeatedly in an essay, law review article, and
together with Professors James B. Speta and Glen O. Robinson in an Amicus
Brief, is: No, it did not. At least, it did not for any of the reasons advanced by the Federal
Communications Commission to date. If the FCC is to regulate the Internet – an
outcome I do not think necessary or beneficial – we would be better served by having
Congress debate and pass such legislation, than by having unelected government
officials attempt to make it up as they go along.
The jurisdictional question, as Lasar notes, lies at the
heart of the viability of the FCC's proposed net neutrality rules. The answer
depends on one's view of what regulatory powers Congress bestowed upon the
agency in the Communications Act of 1934, as amended. Broadly stated, per Title I, Section 1 of the Act, the FCC was created and
given jurisdiction over interstate wire and radio commerce in communication for
the purpose of making available "a rapid, efficient, Nationwide, and world-wide
wire and radio communication service with adequate facilities at reasonable
charges." It is in the understanding of specifically how the FCC was to go about
carrying out this broad purpose that reasonable minds disagree.
The FCC is a creature of Congress. It has no "common law"
ability to make law (or act in a legislative capacity), save for those powers expressly
delegated to it by Congress in the Communications Act. The FCC's specific
statutory responsibilities with respect to the services of common carriers,
spectrum-based services, and the services of cable operators are spelled out,
in great detail, in Titles II, III, and VI of the Act. There is no analogous express delegation of regulatory authority over the
Internet or Internet services in the Act. The FCC has made clear its view that
it may regulate the network management practices of broadband Internet service
providers under its implied or "ancillary jurisdiction."
Ancillary jurisdiction is an FCC-created and
judicially-sanctioned doctrine that permits the agency to regulate services
within its subject matter jurisdiction – interstate wire and radio
communications – where such regulation is "reasonably ancillary" to its
statutory responsibilities under the Act. Ancillary jurisdiction is a statutory gap-filler that has been upheld sparingly by the courts. There is
no argument over the first prong of the test – Internet services are
indisputably a form of wire and radio communications. It is the second prong
of the test for ancillary jurisdiction that is problematic in the case of
Internet service regulation. To what expressly delegated regulatory
responsibility are net neutrality rules "reasonably ancillary?" As the D.C.
Circuit has found, to meet this test, there must be a requisite degree of
"ancillariness" between the regulation proposed, and the statutory
responsibility to which it is purportedly ancillary.
In its net neutrality rulemaking the FCC, as it did in its 2008 Comcast
P2P Order, relies upon the doctrine of ancillary jurisdiction as
the source of its authority "to regulate the network practices of
facilities-based broadband Internet access service providers." In the Comcast P2P Order, the FCC cited no fewer than seven separate
statutory provisions in support of its ancillary jurisdiction to regulate the
Internet network management practices of Comcast. This exercise — searching for snippets and threads of regulatory authority over
a communications medium as significant as the Internet in multiple, unrelated
statutory provisions — itself should signal to the reviewing court that the
exercise is unlikely to produce a credible source of authority. In other
words, Congress does not, in the words of the D.C. Circuit, hide elephants in
The FCC's Net Neutrality NPRM devotes a mere four out
of 186 paragraphs on the agency's delegated authority to prescribe the proposed
rules, and whittles the list of direct statutory sources for its ancillary
jurisdiction down to just two substantive provisions: Section 230(b) and
Section 706(a). The problem with both of these provisions as sources of regulatory authority is
that neither actually directs the FCC to regulate anything in particular. Neither is what one would call an "operative" or "substantive" source of
regulatory authority. As demonstrated in greater depth in my law review
article, Undue Process, and in the joint Amicus Brief, Sections 230(b) and 706(a) are themselves statements of Congressional policy
incapable of supporting FCC regulation of either the Internet or Internet
services. If broadband Internet services are as critical to national
well-being as many posit, Congress would hardly have scattered the FCC's
regulatory authority over them in the interstices of seven or more disparate provisions
of the Act. To the contrary, it would have created a new Title governing Internet services
directly, as it has for common carrier, spectrum-based broadcast, and cable
Lasar observes in his article:
[O]ne of the most striking aspects of the [Communications
Act] is how little it actually says about the Internet. The only part of the
333-page document that specifically mentions the ‘Net is Section 230 of the
The most important part of that block of words reads as
(b) POLICY.—It is the policy of the United States—
(1) to promote the continued development of the Internet and other interactive
computer services and other interactive media;
(2) to preserve the vibrant and competitive free market
that presently exists for the Internet and other interactive computer services,
unfettered by Federal or State regulation;
(3) to encourage the development of technologies which maximize
user control over what information is received by individuals, families, and
schools who use the Internet and other interactive computer services;
(4) to remove disincentives for the development and
utilization of blocking and filtering technologies that empower parents to
restrict their children's access to objectionable or inappropriate online
(5) to ensure vigorous enforcement of Federal criminal
laws to deter and punish trafficking in obscenity, stalking, and harassment by
means of computer.
It is evident that the five separate policy statements
contained in Section 230(b) are quite broad and vague and can be read to
contradict one another in several material respects. But read as a whole, the
statements more convincingly repel, rather than support, FCC regulation of the
broadband Internet and interactive computer services. Section 230(b)(2)
containing perhaps the most directly relevant sub-provision: "[It is the
policy of the United States –] to preserve the vibrant competitive free
market that presently exits for the Internet and other interactive computer
services, unfettered by Federal or State regulation." The remainder of
Section 230 creates "Good Samaritan" immunity for Internet service providers
and other Internet portals that block objectionable content; it specifies no
role for the FCC and calls for no FCC rules for its implementation.
In the case of Section 706(a), which was appended as a
footnote to Section 7 of the Communications Act by the Telecommunications Act
of 1996, Congress directed the FCC "to encourage the deployment on a reasonable
and timely basis of advanced telecommunications capability to all Americans."
As Lasar notes, Section 7 itself declares that:
It shall be the policy of the United States to encourage
the provision of new technologies and services to the public. Any person or
party (other than the Commission) who opposes a new technology or service
proposed to be permitted under this Act shall have the burden to demonstrate
that such proposal is inconsistent with the public interest.
The sole regulatory responsibility delegated to the FCC in
706(b) is the obligation to produce a periodic report to Congress on whether
advanced telecommunications are being deployed on a reasonable and timely
basis. Only upon a negative finding, which the FCC has never made, is the FCC
directed to take any action at all. The FCC itself has held that Section 706 does not expand its regulatory
jurisdiction in any respect; any action the FCC may wish to take upon a
negative report must be found elsewhere in the Act. So too, the policy
expressed in Section 7 itself would appear at odds with FCC rules that may
effectively relegate new network management technologies to a
How then do these policy provisions give the FCC the
authority to codify and expand its four Internet policy principles into six
"rules of the road" for all broadband Internet access service providers –
wireline, wireless and satellite – as the Net Neutrality NPRM proposes? They
don't. There is no close nexus or requisite degree of ancillariness between, for
example, proposed rule "§ 8.13 Nondiscrimination," decreeing that "Subject to
reasonable network management, a provider of broadband Internet access service
must treat lawful content, applications, and services in a nondiscriminatory
manner," and the Section 706(a) charge that the FCC "encourage the deployment
of advanced telecommunications capability." To the contrary, broadband
deployment is more likely to be adversely affected by rules requiring broadband
ISPs to them to repeatedly query Mother FCC: "May I do x, y, or z on my
network to manage congestion?"
Neither do the various policy pronouncements contained
within Section 230(b)—several of which concern ISPs enabling "blocking and
filtering technologies" so that users can restrict access by children to
objectionable or inappropriate online material—lend themselves to supporting a
nondiscriminatory carriage requirement. There is simply no reasonable
relationship between either the specific policy directives or overall purpose
of Section 230 and the FCC's proposed rules.
Nor should we want an FCC that just makes it up as it goes
along on the foundational question of its own regulatory jurisdiction.
Unchecked regulatory discretion under the amorphous doctrine of "ancillary
jurisdiction" is every bit as big a danger to a free and open Internet as any
of the other dangers the FCC posits to support its net neutrality rulemaking.
I am not alone in my discomfort with the FCC's reliance on
ancillary jurisdiction to support its net neutrality regime. The Electronic
Freedom Foundation has also raised alarms about the FCC's proposed expansion of
its regulatory domain through ancillary jurisdiction because the theory the FCC
posits to justify its net neutrality rules simply has no limits:
But Congress has never given the FCC any authority to
regulate the Internet for the purpose of ensuring net neutrality. In place of
explicit congressional authority, we expect the FCC will rely on its "ancillary
jurisdiction," a position that amounts to "we can regulate the Internet however
we like without waiting for Congress to act." (See, e.g., the FCC's brief to a
court earlier this year). That's a power grab that would leave the Internet
subject to the regulatory whims of the FCC long after Chairman Genachowski
leaves his post.
Hence the danger. If "ancillary jurisdiction" is enough
for net neutrality regulations (something we might like) today, it could just
as easily be invoked tomorrow for any other Internet regulation that the FCC
dreams up (including things we won't like). For example, it doesn't take much
imagination to envision a future FCC "Internet Decency Statement. ... And it's
also too easy to imagine an FCC "Internet Lawful Use Policy ..."
I agree completely with these concerns. Unchecked
administrative power, no matter how well-intentioned, is dangerous. The
problem with the doctrine of ancillary jurisdiction is that it is potentially
limitless as exercise after exercise takes the FCC further and further away
from its core congressionally-delegated regulatory responsibilities. Express
delegations of regulatory authority by Congress are important for two reasons:
they both give power and limit its exercise in ways agreed upon by our elected
representatives through duly-enacted legislation. It is particularly important
that unelected government officials stay within the bounds of these
delegations. Our individual freedoms as well as our democracy depend on it.
Related PFF Publications
- Barbara Esbin, "‘The Law is Whatever the Nobles Do:' Undue
Process at the FCC," Progress on Point No. 15.12, Aug. 2008, http://www.pff.org/issues-pubs/pops/2008/pop15.12undueprocess.pdf.
- Barbara Esbin and Adam Marcus, "The Law is Whatever the Nobles
Do": Undue Process at the FCC, 17 CommLaw Conspectus *1 (2009), available at http://commlaw.cua.edu//articles/v17/17.2/Esbin-Marcus-Revised.pdf.
- Brief Amicus Curiae of Professors James B. Speta and Glen O.
Robinson and The Progress and Freedom Foundation in Support of Petitioner
Comcast Corporation and Urging That the FCC's Order Be Vacated, Comcast
Corp. v. FCC, No. 08-1291 (D.C. Circuit Court of Appeals), available at http://www.pff.org/issues-pubs/filings/2009/081009-amicus-brief-comcast-vs-FCC-(08-1291).pdf.
- Barbara Esbin, "The Audacity to Hope Regulatory Restraint Will
Prevail," Progress Snapshot No. 5.9, Sep. 2009, http://www.pff.org/issues-pubs/ps/2009/ps5.9-regulatory-restraint-hope-audacity.html.
- Berin Szoka & Adam Thierer, "Net Neutrality, Slippery
Slopes & High-Tech Mutually Assured Destruction," Progress Snapshot No.
5.11, Oct. 2009, http://www.pff.org/issues-pubs/ps/2009/ps5.11-net-neutrality-MAD-policy.html.
Esbin is a Senior Fellow and Director of the Center for Communications and
Competition Policy at The Progress & Freedom Foundation. The views
expressed in this report are her own, and are not necessarily the views of the
PFF board, fellows or staff.
 Barbara Esbin, The Progress & Freedom Foundation, "'The Law is Whatever the
Nobles Do:" Undue Process at the FCC, Progress on Point No. 15.12, Aug. 2008, http://www.pff.org/issues-pubs/pops/2008/pop15.12undueprocess.pdf;
Barbara Esbin and Adam Marcus, "The Law is Whatever the Nobles Do": Undue
Process at the FCC, 17 CommLaw Conspectus *1 (2009), available at http://commlaw.cua.edu//articles/v17/17.2/Esbin-Marcus-Revised.pdf;
Brief Amicus Curiae of Professors James B. Speta and Glen O. Robinson and The
Progress and Freedom Foundation in Support of Petitioner Comcast Corporation
and Urging That the FCC's Order Be Vacated, Comcast Corp. v. FCC, No.
08-1291 (D.C. Circuit Court of Appeals), available at http://www.pff.org/issues-pubs/filings/2009/081009-amicus-brief-comcast-vs-FCC-(08-1291)pdf.
 Communications Act of 1934, as amended, 47 U.S.C. §§ 151, et al ("The
 47 U.S.C. § 151 (2000).
 See Titles II, III, and VI of the Communications Act of 1934, as amended, 47
U.S.C. §§ 201-276; §§ 301-399b §§ 521-573 (2002).
 NARUC v FCC, 533 F.2d 601, 613 (D.C. Cir. 1976).
 In re Formal Complaint of Free Press and Public Knowledge Against
Comcast Corporation for Secretly Degrading Peer-to-Peer Applications; Broadband
Industry Practices, Petition of Free Press et al. for Declaratory Ruling that
Degrading an Internet Application Violates the FCC's Internet Policy Statement
and Does Not Meet an Exception for "Reasonable Network Management," Memorandum Opinion and Order,
23 F.C.C.R. 13,028, ¶ 1 (Aug. 1, 2008) ("Comcast P2P Order"), available at http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-08-183A1.pdf.
 Am. Library. Ass'n. v. FCC, 406 F3d 689, 704 (D.C. Cir. 2005), quoting Whitman
v. Am. Trucking Ass'ns 531 U.S. 457, 468 (2001).
 Net Neutrality NPRM, at ¶¶ 83-87.
 Indeed, in its Brief to the D.C. Circuit supporting the Comcast P2P Order, the
FCC cited yet an eighth provision of the Act, Section 543 (governing cable rate
regulation, not even mentioned in the underlying Order, as supporting its
ancillary jurisdiction to regulate Comcast's cable modem network management
practices. See Brief for Respondents, Comcast Corp. v. FCC, No. 08-1291 (D.C.
Circuit Court of Appeals), http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-293573A1.pdf.
According to the FCC's General Counsel, the Brief more fully explicates the
FCC's jurisdictional basis for the rulemaking than the NPRM itself. See "Statutory Authority
and Ancillary Jurisdiction," Tech Law Journal Daily Email Alert No. 2,008,
Oct. 23, 2009 (TLJ asked Austin Schlick, The FCC's General Counsel, at the
FCC's meeting on October 22, 2009 what is the statutory authority for the just
released NPRM. He said "Read our brief in the Comcast case.").
 47 U.S.C. § 706(b) (2000).
 The Net Neutrality NPRM does include one new jurisdictional basis
insofar as it proposes to extend the Internet policy principles to wireless
Internet access service providers: the FCC's authority to allocate and license
spectrum usage pursuant to Title III. Net Neutrality NPRM at ¶ 86. As
the FCC notes, it has "relied upon Title II authority in the past to regulate
services provided by wireless carriers." Id. Unfortunately, this is
the extent of the FCC's guidance on precisely how its Title III radio spectrum
allocation and licensing authority would support a wireless broadband Internet
access service rule limiting the provider's ability, for example, to manage
congestion on its network.