Not 'clear cut' at all
"In both Brand X (2005) and Verizon (2010) the US Courts were invited to allow the FCC the authority to apply Class II. And they clearly sent a message that they can't give the FCC authority to do that, because Congress was so clear cut about the distinction when it wrote the 1996 Telecommunications Act."
Not so. Not even close.
In Brand X, the Supreme Court deferred to the FCC following from the Chevron Doctine.
In more detail, the Ninth Circuit originally ruled that classifying "cable companies providing cable modem service" as "telecommuniacations providers" was the best construction of the 1996 Telecommunications Act.
On appeal, the Supreme Court ruled that the Ninth Circuit had erred. Not in their reading of the statute, however, but in substituting their reading for the reading of the FCC. Or, more specifically, the reading of the statue given in a previous ruling.
Here is an important technicality that gets lost. The Ninth Circuit, in a previous decision, held that the best interpretation of the Telecommunication Act was that cable providers should be considered "telecommunications providers". They then relied on that precedent to overrule the interpretation of the FCC.
Where the Ninth Cicuit erred, however, was that:
". . . a court’s interpretation of a statute trumps an agency’s under the doctrine of stare decisis only if the prior court holding determined a statute’s clear meaning." (Thomas)
They (the Ninth Circuit) therefore should have applied Chevron in accepting the FCC's interpretation because:
"Its prior decision in Portland held only that the best reading of §153(46) was that cable modem service was a “telecommunications service,” not that it was the only permissible reading of the statute."
It is a permissible, lawful contruction of the Act to class cable providers as "telecommunications services" and the Ninth Circuit believes that not only is it a permissible reading, it is also the best reading.
It is not, however, the only reading and, as he FCC's reading - that cable providers are not TCs - is also permissible and lawful, the Court, under the Cevron Doctrine, must defer to the Agency.
Of particular note is the following:
". . . our conclusion that it is reasonable to read the Communications Act to classify cable modem service solely as an “information service” leaves untouched Portland’s holding that the Commission’s interpretation is not the best reading of the statute."
What is notable here is that what all this hinges on whether cable providers can be considerd a "telecommunications service". Further, this definition hinges on just one word: "offering", because a "telecommuncations service" is:
". . . the offering of telecommunications for a fee directly to the public."
Given the author's assertion that it's "clear cut", the opinion of Thomas is worth giving at length:
"We have held that where a statute’s plain terms admit of two or more reasonable ordinary usages, the Commission’s choice of one of them is entitled to deference. See Verizonm, 535 U.S., at 498 (deferring to the Commission’s interpretation of the term “cost” by reference to an alternative linguistic usage defined by what “[a] merchant who is asked about ‘the cost of providing the goods’ ” might “reasonably” say); National Railroad Passenger Corporation v. Boston & Maine Corp., 503 U.S. 407, 418 (1992) (agency construction entitled to deference where there were “alternative dictionary definitions of the word” at issue). The term “offe[r]” as used in the definition of telecommunications service, 47 U.S.C. § 153(46), is ambiguous in this way."
Justice Scalia's dissent is noteworthy*:
"If, for example, I call up a pizzeria and ask whether they offer delivery, both common sense and common “usage,” ante, at 18, would prevent them from answering: “No, we do not offer delivery–but if you order a pizza from us, we’ll bake it for you and then bring it to your house.” The logical response to this would be something on the order of, “so, you do offer delivery.” But our pizza-man may continue to deny the obvious and explain, paraphrasing the FCC and the Court: “No, even though we bring the pizza to your house, we are not actually ‘offering’ you delivery, because the delivery that we provide to our end users is ‘part and parcel’ of our pizzeria-pizza-at-home service and is ‘integral to its other capabilities.’ ” Cf. Declaratory Ruling 4823, ¶39; ante, at 16, 26.1 Any reasonable customer would conclude at that point that his interlocutor was either crazy or following some too-clever-by-half legal advice."
Thomas addresses the dissent but the upshot of the lot is that this only reinforces his opinion that the definition is ambiguous and permissive to multiple lawfully interpretations, leading to what I believe is the nub of the opinion:
"Because the term “offer” can sometimes refer to a single, finished product and sometimes to the “individual components in a package being offered” (depending on whether the components “still possess sufficient identity to be described as separate objects,” post, at 3), the statute fails unambiguously to classify the telecommunications component of cable modem service as a distinct offering. This leaves federal telecommunications policy in this technical and complex area to be set by the Commission, not by warring analogies."
The issue, then, is not whether they are one ("Information Service") or the other ("Telecommunications Service"). They are clearly an "Information Service" and there is no challenge so the question is whether they also "offer" telecommunications services, which hinges on what you determine the word "offer" to mean in this context. And this is far, far, from "clear cut".
I apologise for the volume of this post but I feel it's important to point out where Mr Orlowski is incorrect with something more substantial that "nope".
* - I recommend taking the time to go through it in full as it is excellent reading, like all of Scalia's opinions and especially his dissents.
Biting the hand that feeds IT
