First: The
Restoring Internet Freedom Order
secures a free and open interstate commercial market for broadband Internet access services.
Consistent with Congress's established policy in Section 230(b) of the Telecommunications Act of 1996
"to preserve the vibrant and competitive free market that presently exists for the Internet . . . unfettered by Federal or State regulation," the
Commission repealed common carrier public utility-like regulation imposed by the 2015
Title Order
and reclassified broadband Internet access services as non-regulated, or at least lightly regulated, Title I "information services."
This free market-oriented approach to broadband services coincides with the approach articulated in
landmark Supreme Court opinions by Chief Justice Marshall in cases such as
Gibbons v. Ogden
(1824) and
Brown v. Maryland
(1827). These cases recognized that securing a free interstate marketplace is a primary purpose of the U.S. Constitution's Commerce Clause.
Indeed, under the Articles of Confederation, Congress was powerless to regulate commerce among the several states, and this, along with the lack of the power of taxation, was a primary reason for the convening of the Constitutional Convention that led to the adoption of the Constitution of 1787. At the Convention, James Madison, the Constitution's principal draftsman, declared himself "more and more convinced that the regulation of commerce was in its nature indivisible and ought to be wholly under one authority." According to constitutional scholar Larry Klarman, "Madison believed the Constitution's grant of commerce power to Congress automatically would preempt states from enacting laws interfering with interstate or foreign commerce." John Marshall's Commerce Clause jurisprudence bolstered this Madisonian view. As James W. Ely, Jr., a prominent law professor, observed: "Marshall sought to strengthen the bonds of the federal union, encourage the formation of a national market, and safeguard property rights from state interference."
Second: Broadband Internet access services are matters of nationwide concern and the intrastate and interstate portions of those services cannot practically be segregated.
In the
Restoring Internet Freedom Order
, the Commission concluded: "[I]t is well-settled that Internet access is a jurisdictionally interstate service because 'a substantial portion of Internet traffic involves accessing interstate or foreign websites.'" The Commission also concluded: "[I]t is impossible or impractical for ISPs to distinguish between intrastate and interstate communications over the Internet or to apply different rules in each circumstance."
These conclusions by the Commission are consonant with Marshall's expounding of Congress's constitutional power "To regulate Commerce… among the several States" in
Gibbons
. John Marshall declared that Congress's power "applied to all the external concerns of the nation, and to those internal concerns which affect the states generally." The courts have recognized that the Commerce Clause prohibits regulation of activities "that inherently require a uniform system of regulation" and regulation "impair[ing] the free flow of materials and products across state borders."
Surely, such concerns include substantial portions of Internet traffic accessing interstate and foreign websites. Additionally, in
Gibbons
Marshall opined: "The word 'among' means intermingled with," and "[a] thing which is among others, is intermingled with them." And thus: "Commerce among the states cannot stop at the external boundary of each state, but may be introduced into the interior." Likewise, broadband Internet networks transmit data among and within the borders of different states. The intrastate and interstate elements of broadband services are indeed "intermingled" in a way that it is impossible or impractical to segregate and thus properly subject to federal jurisdiction only.
Third: The
Restoring Internet Freedom Order
prescribes free market competition as the general rule by which interstate commerce in broadband Internet access services is to be conducted.
In the
RIF Orde
r, the Commission adopted "a calibrated federal regulatory regime based on the pro-competitive, deregulatory goals of the 1996 Act." Contrary to claims by some pro-regulatory advocates, the Commission did not simply abandon authority in this area and leave matters up to the states. Rather, the Commission's reestablishment of what it referred to as "an affirmative federal policy of
de
regulation" was an exercise of regulatory power according to Marshall's understanding of the term.
In
Gibbons
, Marshall explained that "the power to regulate" commerce among the states meant the power "to prescribe the rule by which commerce is to be conducted."
Thus, the
Restoring Internet Freedom Order
reestablished free market competition as the basic rule by which interstate commercial activity in the broadband Internet access services market is to be conducted.
Fourth:
Califor
nia's law conflicts with the
Restoring Internet Freedom Order
's free market-oriented federal policy toward broadband Internet access services.
The
RIF Order
expressly "preempt[s] any state or local measures that would effectively impose rules or requirements that we have repealed or decided to refrain from imposing… or that would impose more stringent requirements for any aspect of broadband service." The
RIF Order
makes clear that broadband service should be governed "by a uniform set of federal regulations, rather than by a patchwork that includes separate state and local requirements."
In
Gibbons
, Marshall explained that the Constitution's framers included the Article VI, Section 2 Supremacy Clause to address occasions when federal and state laws conflict: "This Constitution, and the Laws of the United States which shall be made in Pursuance thereof… shall be supreme Law of the Land… any Thing in the Constitution or Laws of any State to the Contrary notwithstanding." According to Marshall: "In every such case, the act of Congress… is supreme, and the law of the State, though enacted in the exercise of powers not controverted, must yield to it."
California's law purports to reimpose at the state level many of the same restrictions contained in the repealed 2015
Title II Order
. Indeed, it imposes even more stringent restrictions than the
RIF Order
repealed. SB-822 clearly conflicts with the
RIF Order
and congressional policy regarding an Internet "unfettered by Federal or State regulation." Consistent with Marshall's straightforward understanding of the Supremacy Clause, the state's law should be preempted.
Although the Justice Department's lawsuit challenging California's SB-822 will likely succeed based squarely on modern federal preemption precedents, the jurisprudence of John Marshall supplies critical constitutional antecedents of those modern precedents. And, importantly, consideration of Marshall's Commerce Clause jurisprudence from the early days of the Republic deepens and reinforces the conclusion that the federal deregulatory policy for broadband Internet access services reestablished in the
RIF Order
should result in the preemption of California's SB-822.
Read the complete
Perspectives,
with footnotes,
here
.
