California is facing lawsuits from the U.S. Department of Justice and the broadband industry over the state’s landmark net neutrality law.
Net neutrality is the principle that all internet traffic should be treated equally. In 2015, the FCC enforced net neutrality protections to regulate broadband providers like public utilities. The Trump-era FCC voted to repeal net neutrality rules in 2017. On one hand, Democrats, tech companies, and consumers have pushed for stricter regulations to prohibit the prioritization of internet traffic and boost innovation. On the other hand, Republicans and Internet Service Providers (“ISPs”) argue that net neutrality discourages investment.
The California net neutrality law (SB-822) is the strictest yet of the state legislative efforts to revive net neutrality. SB-822 goes further than just banning ISPs from implementing internet fast-lanes—it also prohibits selective exemptions of apps and services from customer data caps. Other states planning to enact their own net neutrality laws view SB-822 as the “gold standard” of internet regulation.
Federalism is the key issue in this legal fight. Both lawsuits allege the FCC’s deregulatory order preempts the California law and that SB-822 is an unconstitutional attempt to regulate interstate commerce. Supporters of SB-822 say that the FCC explicitly gave up the agency’s authority to regulate internet providers. Further supporters say that where there is no federal law, states can assert their own. According to California Attorney General Xavier Becerra, “California, the country’s economic engine, has the right to exercise its sovereign powers under the Constitution.”
The question of whether the FCC preempts state regulations will be decided by a case pending at the D.C. Circuit. If California prevails, it will set a new precedent of states reviving regulations in the wake of federal deregulatory orders and open the door for other states working on their own net neutrality laws.