In 2017 when the FCC released its Restoring Internet Freedom Order classifying broadband Internet access service as a Title I information service and effectively removing net neutrality as a federal law, some states decided to implement their own net neutrality laws.  The most stringent and comprehensive was California’s, which went even further than the federal law, even banning zero rating services (zero minutes charged for certain data use).   However, when the Trump Justice Department intervened in 2018, the California law was put on hold.  That began to change this year when the new pro net neutrality administration took over, and the DOJ dropped the case.  That still left a lawsuit filed against the California law by USTELCOM, NCTA, CTIA, and the American Cable Association. 

A hearing on this lawsuit was held on February 23, 2021 and a Judge for the District Court of Eastern California concluded in a conference call that (1) the ISPs had failed to demonstrate that they would be harmed by the California law; (2) his decision was policy-based and not political; and (3) Congress should determine a permanent net neutrality policy and not the courts. 

The ISPs criticized the decision but have not decided if they will seek an appeal.  They stated that individual state net neutrality laws would confuse consumers and stunt broadband investment.  Conversely, the decision was cheered by Acting FCC Chairwoman Jessica Rosenworcel who dissented to the Restoring Internet Freedom Order when it was released in 2017 and is a strong net neutrality advocate. 

As mentioned, the California net neutrality law – SB-822 - is all encompassing.  Here are its key provisions: 

It is unlawful for a fixed or mobile Internet provider to engage in the following activities: 

(1) Blocking lawful content, applications, services, or nonharmful devices, subject to reasonable network management. 

(2) Impairing or degrading lawful Internet traffic on the basis of Internet content, application, or service, or use of a nonharmful device, subject to reasonable network management. 

(3) Requiring consideration, monetary or otherwise, from an edge provider, including, but not limited to, in exchange for any of the following: 

(A) Delivering Internet traffic to, and carrying Internet traffic from, the Internet service provider’s end users. 

(B) Avoiding having the edge provider’s content, application, service, or nonharmful device blocked from reaching the Internet service provider’s end users. 

(C) Avoiding having the edge provider’s content, application, service, or nonharmful device impaired or degraded. 

(4) Engaging in paid prioritization. 

(5) Engaging in zero-rating in exchange for consideration, monetary or otherwise, from a third party. 

(6) Zero-rating some Internet content, applications, services, or devices in a category of Internet content, applications, services, or devices, but not the entire category. 

(7) Unreasonably interfering with, or unreasonably disadvantaging, either an end user’s ability to select, access, and use broadband Internet access service or the lawful Internet content, applications, services, or devices of the end user’s choice, or an edge provider’s ability to make lawful content, applications, services, or devices available to end users. Reasonable network management shall not be a violation of this paragraph. 

With the FCC set to restore net neutrality at the Federal level as soon as a new commissioner joins the Commission, net neutrality opponents have some key strategic decisions to make.  Should they fight the California law all the way to the Supreme Court or wait until more state laws are permitted to take effect?  Or should they ignore the states and appeal only when the FCC reclassifies broadband Internet access service as a telecommunications service?  If I were in their shoes, I would appeal the California decision ASAP.  The last thing ISPs need is to have a bunch of state laws in effect and then have the onus to show how they were damaged.  We will soon find out what they decide to do.