Kavanaugh on net neutrality: U.S. Telecom Association v. Federal Communications Commission
on Jul 24, 2018 at 3:04 pm
One of the opinions from current Supreme Court nominee and D.C. Circuit Judge Brett Kavanaugh that has garnered significant attention is his 2017 dissent from the denial of rehearing en banc in the net-neutrality case, U.S. Telecom Association v. Federal Communications Commission. A majority of the full U.S. Court of Appeals for the District of Columbia Circuit declined to reconsider a panel decision upholding the FCC’s net neutrality rule, which essentially forbade internet service providers (ISPs) from discriminating in certain ways among content providers delivered through the ISPs’ networks. (The rule was subsequently repealed by the commission.) Kavanaugh’s dissent argued that the FCC was not authorized to impose its net-neutrality regulations on ISPs for two reasons: first, because the regulations constituted a “major rule” that lacked clear authorization in the statute; and second, because they would violate the ISPs’ First Amendment rights. Proponents have pointed to this decision as Kavanaugh standing up for liberty and free speech, while opponents claim that it shows his political opposition to — and perhaps imperfect understanding of — the broadly popular net-neutrality policy. A concurrence from Judges Sri Srinivasan and David Tatel (both of whom were previous Supreme Court short-listers) contained an extensive back-and-forth with Kavanaugh’s decision, and readers can look at the opinions themselves to see who they think has the best of the arguments. The more interesting point for present purposes is probably that the two arguments Kavanaugh endorsed, and the way he deployed them, lend credence to those who argue that — for better or worse — Kavanaugh will be friendly to powerful business interests on the Supreme Court, and will tend to stand in the way of efforts by the administrative state to regulate them.
Kavanaugh’s first argument was that the FCC lacked authority to impose the net neutrality rule because it is a “major rule” and the Supreme Court has recently required that major rules have clear authorization in the statutes those rules purport to carry out. In his view, the ambiguity over whether Congress intended ISPs to be regulated as common carriers (like telephone companies) or information services (like AOL or Prodigy were at the time of the 1996 law at issue) means that the FCC cannot treat them as common carriers, because it is too major a regulatory step.
As an initial matter, it’s useful to point out that the “major rules” doctrine is itself somewhat controversial. The cases that Kavanaugh cites for the doctrine are useful examples of how that doctrine would work, but those cases don’t explicitly refer to a “major rules” doctrine by name. The major rules doctrine actually looks like the opposite of the predominant administrative law doctrine (called Chevron deference), which treats statutory ambiguity as a congressional invitation to rulemaking rather than a bar on it. This isn’t to say that there’s no good argument for the major rules doctrine — it’s been endorsed by leading scholars of regulation and statutory interpretation. It’s only to say that, even in deploying it, Kavanaugh is making a choice about how to approach the interpretation of an ambiguous statute that tends to disfavor big regulatory moves.
Beyond that, it is worth observing that Kavanaugh’s invocation of the doctrine in this case shows a rather expansive view of it. This isn’t a situation in which a court is taking a statute that is clearly about one thing (say, “drugs” and medical “devices”), observing that the statutory definition is ambiguous enough to cover an arguably pretty different thing (say, tobacco and cigarettes), and then denying that Congress intended to grant an agency regulatory authority over the latter item because it wouldn’t hide that elephant in a statutory mousehole, as the Supreme Court did in 2000 in Brown & Williamson Tobacco and in 2006 in Gonzales v. Oregon. Congress plainly intended to allow the FCC to impose common carrier obligations on some class of services, and then left it unclear whether a modern ISP like Comcast or Verizon would fall within that class of services. And the Supreme Court even held in 2005 in National Cable and Telecommunications Association v. Brand X Internet Services that this was the very kind of ambiguity that Congress’ statute had empowered the FCC to resolve. Accordingly, Kavanaugh is adopting a very broad conception of the major rules doctrine, one that would essentially prohibit agencies from doing anything that seems like a really big deal unless Congress expressly called for it. That is consistent with his general criticism of existing Chevron doctrine. But it is also a move that tends to hamstring the efforts of regulators.
Again, there are arguments for and against this kind of judicial doctrine. Kavanaugh points out that net neutrality has been under active consideration in Congress, and a broad conception of the major rules doctrine forces Congress itself to answer more big policy questions. Institutionalists may well hope that insisting on that action from Congress will tend over time to reduce some of its evident dysfunction — encouraging it to do more, to seek out more bipartisan policy solutions and to be more engaged in smaller-scale policy disputes. Skeptics will note, however, that it is obviously very hard to get Congress to do anything these days, and so a broad conception of the major rules doctrine tends inevitably towards restraining government’s ability to solve problems — even the very kinds of problems seemingly addressed by an agency-empowering statute Congress already passed. Like much of his writing, Kavanaugh’s opinion is quite scholarly and certainly embraces a doctrine of American government whereby Congress does more and the agencies do less. But the upshot is a judicial doctrine that clearly favors established business interests over regulators identifying and trying to fix (what they see as) problems in the market.
Kavanaugh’s second argument in his net-neutrality dissent is very different, but it shares the same deregulatory upshot. He argues that ISPs have a First Amendment right to exert editorial control over the content they convey over the internet, and that the net neutrality rule abridges their right to free speech. Once again, this is a highly debatable proposition that turns upon a question on which smart judges can take both sides: What kind of corporate, market behavior is just “conduct” rather than expressive “speech”? And, once again, Kavanaugh’s broad conception of what constitutes constitutionally protected corporate “speech” serves to insulate far more profit-driven, corporate behavior from regulatory control.
Kavanaugh draws much of his argument from a set of decades-old Supreme Court cases about rules that governed which channels cable companies had to carry. These “must-carry” regulations were held to at least raise a First Amendment concern because they forced cable companies to convey messages with which they might not agree. Kavanaugh sees the same problem in the net neutrality regulations, but there is at least one key difference: The net neutrality rule doesn’t force anyone to carry anything. ISPs are allowed to carry only certain websites, and advertise themselves to their customers as such. Instead, the net neutrality rule largely prohibits ISPs from favoring certain content providers over others in seemingly nonexpressive ways, like taking money from some content providers to deliver their websites faster, or to make their competitors websites run worse. Whether one ultimately agrees with Kavanaugh or not, it is fair to say that the view that these are free speech regulations does not follow inevitably from the Supreme Court’s must-carry cases.
Kavanaugh is once again staking out a pretty broad take on existing doctrine that tends to disfavor government regulation. Almost everything that the government does in the sphere of market regulation impinges on what one might identify as corporate “speech.” That includes rules about marketing cigarettes to minors, rules against competitors “talking” about their prices, rules against threats and bromides regarding worker unionization, and on and on. And the issue isn’t just corporate speech: It theoretically sweeps up laws that impinge on a business-owner’s personal view that serving people of a given race or sexual orientation conveys a message they don’t want to endorse. Kavanaugh or others who fall on the free-speech side of this argument may well find ways to distinguish some of these classic content regulations from laws that they think infringe too directly on speech. But the point is that there is a line-drawing problem between corporate speech and market conduct, that judges will vary in where they draw that line, and that Kavanaugh falls relatively far toward the side of the spectrum that finds more corporate behavior to be speech and thus holds more regulations of that behavior to be unconstitutional.
Again, the upshot is that Kavanaugh endorses certain judicial doctrines that tend to favor businesses over regulators. That does not distinguish him that much from Justice Anthony Kennedy, and it is not to say that he is a reflexive friend of business for political (rather than judicial-theory) reasons. But those who worry that Kavanaugh’s judicial philosophy will stand as a barrier to government regulation of big businesses — including when it comes to policies like net neutrality — are right to feel that way. Conversely, those who celebrate that philosophy as tending to make the market and the country a freer place will find a like-minded champion on the Supreme Court.
[Disclosure: Goldstein & Russell, P.C., whose attorneys contribute to this blog in various capacities, was among the counsel for the intervenors in United States Telecom Association. The author of this post is affiliated with the firm but did not work on this case.]