Appeals court upholds California’s net neutrality law

On Friday, a federal appeals court upheld a previous court’s judgement that California’s net neutrality rules can remain in place. The California regulation, which was signed into law a year after the Federal Communications Commission (FCC) revoked the federal Open Internet Order, is the strictest in the country. The 2015 order established tough net neutrality rules prohibiting internet service providers from banning or slowing down legitimate apps and websites. It also prohibits ISPs from prioritizing commercial content.

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California’s law also prohibits throttling and the use of speed lanes, and the Department of Justice, led by former President Donald Trump, sued the state shortly after it was passed, claiming that the law was pre-empted by the Federal Communications Commission’s repeal of the federal law in 2017. The California law was blocked from taking effect due to this case and other legal challenges, but the DOJ abandoned its action last year.

Industry organizations attempted to stop the California law from taking effect, including the wireless trade association CTIA and internet providers AT&T, Verizon, and Comcast, but a district court judge dismissed their appeal, arguing that the FCC ruling should preempt the state law.

The Ninth Circuit Court of Appeals decided 3-0 on Friday to affirm the lower court verdict, stating the FCC “no longer has the power” to regulate broadband internet services since they were categorized as information services rather than telecommunications services by the agency. “As a result, the agency cannot preempt state action,” the court noted in its decision, adding that the ability to regulate access might “open the way for anticompetitive, discriminatory activity that could harm vital portions of society.”

The industry groups said in a statement released Friday that the current “piecemeal approach”  to the issue is “unacceptable,” and that Congress should “once and for all establish national norms for an open Internet. “The FCC currently lacks the necessary majority to reinstate net neutrality at the federal level; it has four members, two Democrats and two Republicans. President Biden’s candidate to succeed outgoing FCC Chairman Ajit Pai, Gigi Sohn, is currently awaiting Senate confirmation.

With President Joe Biden’s nomination to the commission, Gigi Sohn, due to be voted on by the Senate Commerce Committee next week, federal action could be imminent. If the committee recommends her nomination, it will be brought to the Senate floor for a full vote. Republicans and even some Democrats had reservations about her past comments regarding conservative sites and her involvement in a charity internet TV program that shut down after losing a lawsuit from broadcast networks, delaying a vote on her nomination.

Sohn allegedly stated in a letter to the FCC’s general counsel on Thursday that if confirmed to the position, she would voluntarily recuse herself from broadcast copyright and retransmission concerns for the first few years of her term, which might make her confirmation easier. The FCC did not respond to CNBC’s request for comment on the letter right away.

Through his executive order on competition and the appointment of Tim Wu to the White House’s National Economic Council, Biden has made his support for net neutrality obvious. The term “net neutrality” was coined by Wu, and he is credited with popularizing it.

Proponents of net neutrality are praising California’s ruling on Friday while admitting the challenges ahead. In a statement, Stanford Center for Internet and Society Director Barbara van Schewick remarked, “Today’s verdict by the Ninth Circuit is a significant triumph for Californians and a free and open internet.” “This means California can keep enforcing its net neutrality law and protecting Californians from unfair practices by the corporations they pay to access the internet.”

In a statement, Matt Wood, vice president of policy and general counsel at nonpartisan nonprofit Free Press, stated, “While today’s verdict is fantastic news, the job isn’t done.” “This victory is vital because it protects people in our most populous state while also advancing the national conversation.” Even so, the Biden FCC must recover its authority not just for countrywide open-internet laws, but also for policies that promote inexpensive, resilient, just, and reasonable internet connections for everyone.”