California can enforce its law banning internet service providers from blocking or slowing data flows following the Federal Communications Commission’s 2018 repeal of Obama-era net neutrality rules, the Ninth Circuit ruled Friday.
After classifying broadband internet services as information services, the FCC no longer has authority to regulate them in the same way it did when these services were deemed telecommunications services, the U.S. Court of Appeals for the Ninth Circuit said. It therefore can’t preempt state action in this space, including the 2018 California law—called SB-822—that essentially codified the prior federal net neutrality standards within the state, the court said.
“The FCC can not preempt SB-822 because it gave up its full regulatory authority by reclassifying broadband as a Title I information service,” the court said.
The Ninth Circuit’s decision is in line with the U.S. Court of Appeals for the D.C. Circuit’s 2019 opinion in Mozilla Corp. v. FCC. In that case, the D.C. Circuit upheld the FCC’s decision to reclassify broadband internet services but ruled that the reclassification had the effect of stripping the agency of preemptive authority to displace state laws on the subject.
The Ninth Circuit case was closely watched by industry groups and policy makers. Attorneys general in New York, Massachusetts, and 16 other states filed a brief urging the court to uphold the California law as a valid exercise of state police power, while groups including the Telecommunications Industry Association and the Chamber of Commerce argued the law should be rejected as “anathema to the development of a dynamic, constantly changing industry.”
The decision is a loss for trade groups representing communications service providers, which sought an injunction preventing SB-822 from being enforced. They argued the law is preempted because it conflicts with the FCC’s underlying policy goal of establishing a “light-touch regulatory framework.”
The Ninth Circuit disagreed, saying an agency’s policy preferences can’t preempt state action “in the absence of federal statutory regulatory authority.”
The court also declined to hold that SB-822 was preempted by the federal Communications Act itself.
Judge Mary M. Schroeder wrote the opinion, which was joined by Judge Danielle J. Forrest. Judge J. Clifford Wallace filed a short concurrence.
The trade groups are variously represented by MoloLamken LLP; Kellogg, Hansen, Todd, Figel & Frederick PLLC; and Latham & Watkins LLP. The California Department of Justice represented the state.
The case is ACA Connects v. Bonta, 9th Cir., No. 21-15430, 1/28/22.