California’s net neutrality bill is vulnerable to legal attack, EFF says

The California State Senate this week passed a bill that would impose net neutrality restrictions on Internet service providers, but the Electronic Frontier Foundation (EFF) warns that the proposed law has a high chance of being thrown out in court.

“While well-intentioned, the legislators sadly chose an approach that is vulnerable to legal attack,” EFF Legislative Counsel Ernesto Falcon wrote in a blog post yesterday. Falcon also provided California senators with a longer legal analysis a few weeks before the vote.

State laws can be preempted by federal policy, and the Federal Communications Commission’s net neutrality repeal ordered states to refrain from imposing their own net neutrality laws.

There are still ways for states to protect net neutrality, but California’s approach—which essentially replicates the FCC’s repealed rules—isn’t likely to be the most effective option, the EFF argues. “It’s a waste to pass a bill that is vulnerable to legal challenge by ISPs when strong alternatives are available,” Falcon wrote.

Congress explicitly grants states authority over the “charges, classifications, practices, services, facilities, or regulations for or in connection with intrastate communication service by wire or radio of any carrier.”

“Intrastate” is the key here. Commercial activity that crosses state lines is interstate, putting it under the purview of the federal government. But states can work within that restriction to protect net neutrality indirectly, Falcon wrote.

“[T]he legislature should pass a legally enforceable and narrowly targeted state based network neutrality law,” he wrote. “To survive judicial scrutiny, any such law should focus on intrastate conduct. No state law will be able to replace in its entirety what was lost with the repeal of the Open Internet Order in December, due to the limitations created by the Interstate Commerce clause.”

Legally enforceable alternatives

The bill passed by the California senate was proposed by Sen. Kevin de León (D-Los Angeles) and prohibits blocking, throttling, and paid prioritization. It is now pending in the State Assembly. This bill “may be legally unsustainable when facing an expected interstate commerce preemption challenge by major ISPs,” Falcon wrote.

These are the alternatives suggested by the EFF:

Today, California spends $100s of millions on ISPs, including AT&T, as part of its California broadband subsidy program. The state could require that recipients of that funding provide a free and open Internet, to ensure that taxpayer funds are used to benefit California residents rather than subsidizing a discriminatory network. This is one of the strongest means the state has to promote network neutrality, and it is missing from SB 460 [the just-passed Senate bill].

California also has oversight and power over more than 4 million utility poles that ISPs benefit from accessing to deploy their networks. In fact, California is expressly empowered by federal law to regulate access to the poles and the state legislature can establish network neutrality conditions in exchange for access to the poles. Again, that is not in the current bill passed by the Senate.

Lastly, each city negotiates a franchise with the local cable company and often the company agrees to a set of conditions in exchange for access to valuable, taxpayer-funded rights of way. California’s legislature can directly empower local communities to negotiate with ISPs to require network neutrality in exchange for the benefit of accessing tax-payer funded infrastructure. This is also not included in the current bill.

A spokesperson for de León defended the bill’s legality when contacted by Ars today.

“Our experts advise us that while regulating interstate Internet activities may be preempted by federal law (even though the issue almost certainly will be litigated as well), states are permitted to enact laws associated with consumer protection, contracts, and business and advertising practices, all of which the current version of the bill now does,” the spokesperson said. The bill “has been reviewed and commented on by experts at Stanford and Berkeley’s law schools,” one of whom is a “former special counsel to the FCC and quite knowledgeable on preemption and other net neutrality issues.”

A press release issued by de León this week says the bill “makes net neutrality violations subject to enforcement under California’s consumer protection and unfair business practices laws.”

“To be clear, we know that the industry opponents and Trump supporters will make the preemption argument,” de León’s spokesperson also said. “We hope that groups who claim to be looking out for consumers will support SB 460 and help get it passed. In sum, we are comfortable with the current version of SB 460 and welcome any additional suggestions for amendments.”

But even California senators recognize that the bill they just passed might not stand up in court. The bill would adopt “net neutrality rules for California intrastate Internet traffic,” but could still be preempted by the FCC’s net neutrality repeal, according to an analysis prepared by the Senate Committee on Communications.

“[T]he success of implementing this bill is largely hinged on the [FCC’s repeal] order being repealed or rejected, in whole or in part,” the committee analysis says. “Considering the high likelihood that the courts will be asked to weigh in, it seems within the realm of possibilities that the [FCC] order may not withstand a court challenge. However, the issue is not resolved prior to this committee hearing this bill.”

The bill was opposed by the California Cable and Telecommunications Association, a lobby group for Charter, Comcast, Cox, Mediacom, Altice USA, Wave Broadband, and other companies.

Another bill waits for a vote

The EFF recommends a different net neutrality bill proposed by Sen. Scott Wiener (D-San Francisco), which is pending in the California Senate. The EFF-recommended bill “seeks to tie open Internet obligations with access to taxpayer funding or infrastructure,” Falcon wrote.