Internet Service Providers (ISPs) have formally asked the US Supreme Court to invalidate a New York statute that mandates broadband services be offered at $15 per month to low-income residents. The petition, filed by six trade groups representing the cable, telecom, mobile, and satellite sectors, underscores the industry’s concern about a mosaic of state laws that could emerge in the absence of federal regulation.
Although ISPs had successfully blocked the Federal Communications Commission (FCC) from reinstating net neutrality rules, the latest petition highlights the industry’s anxiety about states filling the regulatory void. The argument posits that victories on the federal front could inadvertently empower states like New York to implement their own regulations, potentially leading to what ISPs describe as detrimental rate regulations.
The tension is heightened by a recent decision from the US Court of Appeals for the 2nd Circuit, which upheld New York’s law, reversing a lower court ruling from 2021. New York Attorney General Letitia James agreed not to enforce the law while the Supreme Court considers whether to hear the case. For more details, you can read the petition here.
The fate of the New York law is closely linked to the FCC’s April 2024 revival of net neutrality regulations, categorizing ISPs as common carriers under Title II of the Communications Act. The lack of federal regulations previously gave states greater latitude to set their own rules. The 2nd Circuit stated that a federal agency’s absence from regulating an area does not preclude states from doing so. If the FCC’s revived regulations are overturned, ISPs fear it will pave the way for more state-level laws similar to New York’s.
ISPs are also attempting to overturn these common-carrier regulations. In a recent development, the US Court of Appeals for the 6th Circuit stayed the enforcement of the FCC regulations, suggesting ISPs are likely to succeed in their challenge. For background, see this development here.
The central concern for ISPs is that without federal oversight, each state could impose its own regulatory framework, which they argue would be harmful to providers and consumers alike. The industry is urging the Supreme Court to affirm that the federal Communications Act preempts a fragmented approach of state laws in governing interstate communications services.
Read more about the ongoing legal tussle here.