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Brief of National Ass'n of Mfrs, No. 11-1355 (D.C. Cir.)

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Released: November 1, 2012
USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 1 of 47
ORAL ARGUMENT NOT YET SCHEDULED

IN THE UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Case No. 11-1355
Consolidated with Nos. 11-1356, 11-1403, and 11-1404

VERIZON,

Appellant,
v.

FEDERAL COMMUNICATIONS COMMISSION,

Appellee.
ON APPEAL FROM AN ORDER OF THE
FEDERAL COMMUNICATIONS COMMISSION

BRIEF FOR AMICUS CURIAE NATIONAL ASSOCIATION OF

MANUFACTURERS IN SUPPORT OF PETITIONERS-APPELLANTS

Quentin Riegel
Russell P. Hanser*
NATIONAL ASSOCIATION
Bryan N. Tramont
OF MANUFACTURERS
WILKINSON BARKER KNAUER, LLP
733 10th Street, N.W.
2300 N Street, N.W.
Suite 700
Suite 700

Washington, DC 20001
Washington, DC 20037
(202) 637-3058
(202) 783-4141
Counsel for the National Association
of Manufacturers

*Counsel of Record
July 23, 2012

USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 2 of 47

CERTIFICATE AS TO PARTIES, RULINGS, AND RELATED CASES

A.

Parties

Except for the following, all parties, intervenors, and amici appearing in
this Court and before the Commission are listed in the Verizon/MetroPCS Brief:
Commonwealth of Virginia (amicus curiae); Cato Institute (amicus curiae);
Competitive Enterprise Institute (amicus curiae); Free State Foundation (amicus
curiae); and TechFreedom (amicus curiae).

B.

Rulings Under Review

References to the ruling at issue appear in the Brief of Petitioners-
Appellants.

C.

Related Cases

Amicus curiae the National Association of Manufacturers (“NAM”) adopts
the statement of Petitioners-Appellants Verizon and MetroPCS. See
Verizon/MetroPCS Br. at xii-xiii.
ii

USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 3 of 47

CORPORATE DISCLOSURE STATEMENT

Pursuant to Federal Rule of Appellate Procedure 26.1 and Circuit Rule
26.1, amicus curiae the National Association of Manufacturers states that it is a
nonprofit industrial trade association representing small and large manufacturers
in every industrial sector and in all 50 states. The NAM is the preeminent U.S.
manufacturers’ association as well as the nation’s largest industrial trade
association. The NAM has no parent corporation, and no publicly held company
has 10% or greater ownership in the NAM.
iii

USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 4 of 47

CERTIFICATE OF COUNSEL REGARDING NECESSITY OF

SEPARATE AMICUS CURIAE BRIEFS

Pursuant to Circuit Rule 29(d), the NAM hereby certifies that it is
submitting a separate brief from the other amicus curiae in this case due to the
specialized nature of each amici’s distinct interests and expertise. The NAM
expects that amicus curiae the Commonwealth of Virginia’s brief will focus on
the issues of importance to its citizens as consumers of broadband service, and
that amici Cato Institute, Competitive Enterprise Institute, Free State Foundation,
and TechFreedom will together focus on Constitutional issues raised by the case.
In contrast, the NAM represents the interests of the nation’s manufacturers, which
both utilize and build broadband network infrastructure. This brief therefore
addresses statutory issues of special concern to such manufacturers, particularly as
they pertain to network infrastructure deployment. Given these divergent
purposes, the NAM, though counsel, certifies that filing a joint brief would not be
practicable.
/s/ Russell P. Hanser
Russell P. Hanser
July 23, 2012
iv

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TABLE OF CONTENTS

CERTIFICATE AS TO PARTIES, RULINGS, AND RELATED CASES ............ ii
CORPORATE DISCLOSURE STATEMENT ....................................................... iii
CERTIFICATE OF COUNSEL REGARDING NECESSITY OF
SEPARATE AMICUS CURIAE BRIEFS ...............................................................iv
TABLE OF AUTHORITIES .................................................................................. vii
GLOSSARY ..............................................................................................................x
STATEMENT OF IDENTITY, INTEREST IN CASE, AND SOURCE OF
AUTHORITY TO FILE OF AMICUS CURIAE......................................................1
STATEMENT OF AUTHORSHIP AND FINANCIAL CONTRIBUTIONS .........3
STATUTES AND REGULATIONS.........................................................................3
STATEMENT OF FACTS ........................................................................................3
SUMMARY OF ARGUMENT.................................................................................5
ARGUMENT.............................................................................................................6
I.
CONGRESS HAS NOT AFFORDED THE FCC PLENARY
AUTHORITY TO REGULATE THE INTERNET........................................6
A.
The Statutory Text Demonstrates that Congress Did Not Intend
Section 706 to Vest the FCC with Independent Authority to
Regulate the Internet .............................................................................7
B.
Other Provisions Adopted Alongside Section 706 Further
Demonstrate that Congress Did Not Intend to Confer Broad
Independent Powers to Regulate the Internet .......................................9
C.
The Actions of Post-1996 Congresses Further Confirm the
FCC’s Lack of Authority ....................................................................12
II.
THE ORDER FALLS OUTSIDE THE SCOPE OF ANY
PURPORTED SECTION 706 AUTHORITY ..............................................17
A.
The Order Ignored Extensive Record Evidence Contradicting
Its Speculative Theory That Net Neutrality Regulation Would
Promote Broadband Adoption and Thus Deployment........................18
v

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B.
The Order Also Ignored Extensive Record Evidence that Net
Neutrality Regulation Would Deter Investment and Thus
Deployment .........................................................................................21
CONCLUSION........................................................................................................28
vi

USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 7 of 47

TABLE OF AUTHORITIES*

Cases

Am. Library Ass’n v. FCC,
406 F.3d 689 (D.C. Cir. 2005) ............................................................................ 6
BellSouth Telecomms, Inc. v. FCC,
469 F.3d 1052 (D.C. Cir. 2006) ........................................................................ 21
*Comcast Corp. v. FCC,
600 F.3d 642 (D.C. Cir. 2010) ........................................................................ 4, 8
Dada v. Mukasey,
554 U.S. 1 (2008) ................................................................................................ 9
*FDA v. Brown & Williamson Tobacco Corp.,
529 U.S. 120 (2000) .......................................................................... 7, 12, 13, 14
Greater Boston Television Corp. v. FCC,
444 F.2d 841 (D.C. Cir. 1970) .......................................................................... 21
Gustafson v. Alloyd Co.,
513 U.S. 561 (1995) ............................................................................................ 9
King v. St. Vincent’s Hospital,
502 U.S. 215 (1991) ............................................................................................ 9
La. Pub. Serv. Comm’n v. FCC,
476 U.S. 355 (1986) ........................................................................................ 6, 7
Motor Vehicle Manufacturers Ass’n v. State Farm Mutual Automobile Ins. Co.,
463 U.S. 29 (1983) ............................................................................................. 27
NCTA v. Brand X Internet Services, Inc.,
545 U.S. 967 (2005) .......................................................................................... 11
NRDC v. EPA,
859 F.2d 156 (D.C. Cir. 1988) .......................................................................... 21

Federal Agency Decisions

Appropriate Framework for Broadband Access to the Internet Over Wireline
Facilities, 20 F.C.C.R. 14853 (2005)................................................................. 11
Deployment of Wireline Services Offering Advanced Telecommunications
Capability, 13 F.C.C.R. 24011, 24044 (1998) ..................................................... 8

*
Authorities principally relied upon are marked with an asterisk.
vii

USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 8 of 47
High-Speed Access to the Internet Over Cable and Other Facilities,
17 F.C.C.R. 4798 (2002) .................................................................................... 11
*Preserving the Open Internet,
25 F.C.C.R. 17905 (2010) ........................................................................... passim

Statutes and Regulations

47 U.S.C. §153 ................................................................................................ 10, 11
47 U.S.C. §160 .................................................................................................. 8, 10
47 U.S.C. §161 ...................................................................................................... 10
47 U.S.C. §230(b)(2)............................................................................................. 10
*47 U.S.C. §1302................................................... 4, 5, 6, 7, 8, 9, 10, 16, 17, 18, 26
47 U.S.C. §§ 201-276 ............................................................................................ 11
Pub L. No. 104-104................................................................................................ 10
Pub. L. No. 105-277............................................................................................... 12
Pub. L. No. 108-187............................................................................................... 12
Pub. L. No. 110-283............................................................................................... 13
Pub. L. No. 110-385............................................................................................... 13
Pub. L. No. 111-260............................................................................................... 13
Pub. L. No. 111-5................................................................................................... 13
47 C.F.R. §§ 8.3, 8.5, 8.7......................................................................................... 3

Legislative Materials

H.R. 3458, 111th Cong. (2009) ............................................................................. 14
H.R. 5252, 109th Cong. (2006) ............................................................................. 14
H.R. 5273, 109th Cong. (2006) ............................................................................. 14
H.R. 5353, 110th Cong. (2008) ............................................................................. 14
H.R. 5417, 109th Cong. (2006) ............................................................................. 14
H.R. 5994, 110th Cong. (2008) ............................................................................. 14
S. 215, 110th Cong. (2007).................................................................................... 14
S. 2360, 109th Cong. (2006).................................................................................. 14
S. 2686, 109th Cong. (2006).................................................................................. 14
viii

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S. 2917, 109th Cong. (2006).................................................................................. 14
S. 74, 112th Cong. (2011)...................................................................................... 14

Other Authorities

*John B. Horrigan, Broadband Adoption & Use in America, OBI Working Paper
No. 1 (Mar. 2010)............................................................................................... 19
John B. Horrigan, FCC Survey: Broadband Adoption & Use in America (Mar.
2010)................................................................................................................... 19
*Pew Internet & American Life Project, Home Broadband Adoption 2009 (June
2009)................................................................................................................... 20
ix

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GLOSSARY

Comcast
Comcast Corp. v. FCC, 600 F.3d 642 (D.C. Cir. 2010)
Communications Act
Communications Act of 1934, as amended, 47 U.S.C.
or Act
§ 151 et seq.
DOJ
The United States Department of Justice
FCC or Commission
Federal Communications Commission
FTC
Federal Trade Commission
ISP
Internet Service Provider
JA
Joint Appendix
NAM
Amicus curiae the National Association of
Manufacturers
NPRM
Notice of Proposed Rulemaking
Order
Preserving the Open Internet, 25 F.C.C.R. 17905
(2010)
Section 706
Section 706 of the Telecommunications Act of 1996,
47 U.S.C. § 1302
1996 Act
The Telecommunications Act of 1996, which amended
the Communications Act
x

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STATEMENT OF IDENTITY, INTEREST IN CASE, AND SOURCE OF

AUTHORITY TO FILE OF AMICUS CURIAE

The NAM is a nonprofit industrial trade association representing small and
large manufacturers in every industrial sector and in all 50 states. As the
preeminent U.S. manufacturers’ association as well as the nation’s largest
industrial trade association, the NAM has a significant interest in, and can offer a
unique perspective on, the issues raised by the Petitioners-Appellants.
American manufacturers are the beneficiaries of a globally deployed
broadband infrastructure, which has transformed the way they operate and offered
them numerous opportunities to participate in the creation and deployment of next-
generation services. Manufacturers have also become increasingly dependent on
the Internet and advanced telecommunication services in their daily operations to
connect with customers, employees, suppliers, and valued partners. Specifically,
manufacturers use telecommunications services and related technology to track
production and inventory, to provide online learning tools to employees, and to
assist all aspects of customer service operations from ordering to final delivery of a
product. For these services and the systems on which they run, networks need to
be robust and reliable to benefit manufacturers and consumers alike.
Regulation of broadband Internet services has the potential to impose
burdens on American manufacturers, harming American consumers, preventing the
creation of new jobs, and stifling the rollout of high-speed services to unserved and

USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 12 of 47
underserved areas where the NAM’s members invest and grow their businesses.
The NAM believes that its perspective on the issues raised will aid the Court in
reaching an appropriate decision in this case.
All parties and intervenors have consented to the NAM’s participation as
amicus curiae.
2

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STATEMENT OF AUTHORSHIP AND FINANCIAL CONTRIBUTIONS

No counsel for a party authored this brief in whole or in part, and no such
counsel or any party made a monetary contribution intended to fund the
preparation or submission of this brief.

STATUTES AND REGULATIONS

Pertinent statutes are contained in the Verizon/MetroPCS brief.

STATEMENT OF FACTS

The Order on review adopted a series of rules relating to the provision of
Internet services by Internet Services Providers (“ISPs”). First, the FCC adopted
transparency obligations requiring all ISPs to “publicly disclose accurate
information” regarding their network management practices, performance, and
commercial terms of service. Second, it adopted no-blocking obligations
prohibiting fixed broadband providers from “block[ing] lawful content,
applications, services, or non-harmful devices” and mobile broadband providers
from “block[ing] consumers from accessing lawful Web sites,” or “block[ing]
applications that compete with the provider’s voice or video telephony services,”
all subject to “reasonable network management.” Third, it adopted non-
discrimination requirements prohibiting fixed broadband providers from
“unreasonably discriminat[ing] in transmitting lawful network traffic over a
consumer’s broadband Internet access service,” again subject to reasonable
network management. 47 C.F.R. §§ 8.3, 8.5, 8.7. As applied, these rules
3

USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 14 of 47
constitute rate regulation, requiring ISPs to carry the Internet traffic of “edge”
providers free of charge and effectively prohibiting paid prioritization of certain
traffic streams. Order ¶¶ 67, 76. Such requirements are known colloquially as
“network neutrality,” “net neutrality,” or “open Internet” mandates.
The Order was the FCC’s second attempt to impose net neutrality
requirements. In Comcast, this Court struck down its first effort, finding that the
FCC had not established its legal authority to enforce such principles.1 The instant
Order again cited a broad array of statutory provisions that it claimed afforded it
such authority, but relied principally on Section 706 of the Telecommunications
Act of 1996, 47 U.S.C. § 1302.2 Section 706(a) directs the FCC to “encourage the
deployment on a reasonable and timely basis of [broadband] capability to all
Americans … by utilizing, in a manner consistent with the public interest,
convenience, and necessity, price cap regulation, regulatory forbearance, measures
that promote competition in the local telecommunications market, or other
regulating methods that remove barriers to infrastructure investment.”3 Section
706(b) directs the FCC to assess regularly whether broadband service “is being
deployed to all Americans in a reasonable and timely fashion,” and, if not, to

1 Comcast Corp. v. FCC, 600 F.3d 642 (D.C. Cir. 2010) (“Comcast”).
2 Other provisions cited by the Order fail to afford authority for the rules adopted
here, as Verizon and MetroPCS explain. Verizon/MetroPCS Br. 27-42.
3 47 U.S.C. § 1302(a).
4

USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 15 of 47
“compile a list of geographical areas that are not served” and “take immediate
action to accelerate deployment of such capability by removing barriers to
infrastructure investment and by promoting competition in the telecommunications
market.”4 Although it is impossible to tell from the Order’s text whether the FCC
purported to exercise direct or ancillary authority, the agency seemed to conclude
that these provisions vested it with sweeping authority to regulate the Internet. See
Order ¶¶117-23 (JA __-__).

SUMMARY OF ARGUMENT

The FCC lacked authority to adopt net neutrality rules. First, Congress did
not intend Section 706 to vest the FCC with broad independent authority to
regulate the Internet. That provision’s text only authorizes the FCC to exercise
preexisting statutory powers, and other provisions adopted alongside Section 706
reflect Congress’s intention to safeguard Internet services from regulation.
Moreover, the actions of subsequent Congresses – which have afforded the FCC
and other entities discrete authority over certain aspects of the Internet but have
repeatedly declined to adopt net neutrality legislation – confirm that Congress does
not view the FCC as enjoying plenary authority to adopt the type of rules at issue
here. Indeed, in the months before the Order was adopted, the Chairman of the

4 Id. § 1302(b), (c). See generally Order ¶123 n.384 (claiming that Section 706(b)
authority had been triggered by prior FCC finding).
5

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House Commerce Committee tried and failed to win support for legislation nearly
identical to the regime the FCC adopted here.
Second, any action undertaken pursuant to Section 706 must promote the
deployment of broadband, and the Commission’s rules do not satisfy this test. The
FCC relied on an unsupported, contorted theory, speculating that net neutrality
mandates would lead to adoption of broadband by new users, which would in turn
promote the statutorily required broadband network deployment. The evidence
before the FCC, however, showed that net neutrality does not affect adoption, and
overwhelmingly demonstrated that net neutrality regulations would inhibit
deployment. The FCC failed to address that evidence, much less refute it. The
agency may not rely on speculation, and may not simply ignore evidence
undermining its view.
The Court should reject the FCC’s sweeping assertion of jurisdiction here,
and reverse the Order.

ARGUMENT

I.

CONGRESS HAS NOT AFFORDED THE FCC
PLENARY AUTHORITY TO REGULATE THE
INTERNET

The Order improperly relies on the FCC’s conclusion that Section 706
affords it independent authority to regulate the Internet. But “[t]he FCC …
‘literally has no power to act … unless and until Congress confers power upon it,’”
Am. Library Ass’n v. FCC, 406 F.3d 689, 708 (D.C. Cir. 2005), quoting La. Pub.
6

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Serv. Comm’n v. FCC, 476 U.S. 355, 374 (1986), and a reviewing Court must
reject claims that are “inconsistent with the intent that Congress has expressed in
the … overall regulatory scheme and in the [subject-matter-specific] legislation
that it has enacted….” FDA v. Brown & Williamson Tobacco Corp., 529 U.S. 120,
1226 (2000). Congress manifestly did not intend Section 706 to vest the FCC with
broad and independent authority to regulate the Internet.

A.

The Statutory Text Demonstrates that Congress
Did Not Intend Section 706 to Vest the FCC
with Independent Authority to Regulate the
Internet

Although it is impossible to tell from the Order’s text whether the FCC
purported to exercise direct or ancillary jurisdiction, the agency apparently found
that Sections 706(a) and 706(b) endowed it with sweeping authority to regulate the
Internet. See Order ¶¶117-23 (JA __-__). The statutory text makes clear,
however, that Section 706 mandates exercise of the FCC’s preexisting statutory
powers, and does not confer independent authority to regulate. As noted above,
Section 706(a) directs the FCC to take action “by utilizing … price cap regulation,
regulatory forbearance, measures that promote competition in the local
telecommunications market, or other regulating methods that remove barriers to
infrastructure investment.”5 Based on this text, the FCC in 1998 concluded that

5 47 U.S.C. § 1302(a).
7

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“section 706(a) does not constitute an independent grant of forbearance authority
or of authority to employ other regulating methods,” but rather “directs the
Commission to use the authority granted in other provisions.”6 See
Verizon/MetroPCS Br. 28-30. The FCC explained that it would have made no
sense for Congress to have adopted detailed standards for the exercise of
forbearance elsewhere in the Act, 47 U.S.C. § 160, while contemporaneously
providing separate forbearance authority unhinged from those standards in Section
706.7 Thus, in concluding that the FCC had exceeded its authority in its last effort
to regulate the Internet, this Court in 2010 cited to the FCC’s concession that it
“has no express statutory authority” over ISPs’ network management practices.
Comcast, 600 F.3d at 654. The FCC’s 1998 conclusion was correct at the time,
and remains correct today.

6 Deployment of Wireline Services Offering Advanced Telecommunications
Capability
, 13 F.C.C.R. 24011, 24044 (1998) (“Advanced Services Order”). In
Comcast, this Court rejected the FCC’s claim that the Advanced Services Order
had addressed only forbearance, and found the FCC “bound by” its prior
conclusion that Section 706(a) afforded it no independent authority to employ
other methods. Comcast Corp. v. FCC, 600 F.3d 642, 659 (D.C. Cir. 2010). Yet
the Order on review here – issued nearly eight months after the Comcast decision
– still insists that the Advanced Services Order addressed only forbearance, noting
only grudgingly that “[t]o the extent the Advanced Services Order can be construed
as having read Section 706(a) differently, we reject that reading of the statute for
the reasons discussed in the text.” Order ¶119 n.370 (JA __).
7 Advanced Services Order, 13 F.C.C.R. at 24046.
8

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Section 706(b) fares no better. That provision authorizes the FCC to act
only “by removing barriers to infrastructure investment and by promoting
competition in the telecommunications market.” 47 U.S.C. § 1302(b). Like
Section 706(a), it nowhere affords the FCC independent regulatory authority. And
even the authority it does confer applies only in geographic areas where
deployment has been deemed inadequate, not nationwide. See Verizon/MetroPCS
Br. at 33.

B.

Other Provisions Adopted Alongside Section
706 Further Demonstrate that Congress Did
Not Intend to Confer Broad Independent
Powers to Regulate the Internet

The FCC’s new view of its authority is also refuted by other provisions
adopted in the 1996 Act alongside Section 706. “In reading a statute [a court] must
not look merely to a particular clause, but consider in connection with it the whole
statute.” Dada v. Mukasey, 554 U.S. 1, 16 (2008) (internal quotation marks
omitted). It is a “cardinal rule that a statute is to be read as a whole, … since the
meaning of statutory language, plain or not, depends on context.” King v. St.
Vincent’s Hospital, 502 U.S. 215, 221 (1991). See also Gustafson v. Alloyd Co.,
513 U.S. 561, 569 (1995) (court must interpret a statute “as a symmetrical and
coherent regulatory scheme”).
The 1996 Act’s other provisions disprove any claim that Congress intended
to vest the FCC with broad powers to regulate the Internet. For example, Section
9

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230 states that “[i]t is the policy of the United States… to preserve the vibrant and
competitive free market that presently exists for the Internet and other interactive
computer services, unfettered by Federal or State regulation….” 47 U.S.C.
§ 230(b)(2) (emphasis added). This statement of national policy is impossible to
square with the view that the simultaneously adopted Section 706 granted the FCC
apparently limitless authority to regulate the Internet.
Other provisions confirm the 1996 Act’s deregulatory approach: The Act’s
preamble stated that its purpose was “[t]o promote competition and reduce
regulation in order to secure lower prices and higher quality services for American
telecommunications consumers and encourage the rapid deployment of new
telecommunications technologies.”8 Section 10, 47 U.S.C. § 160, required the
FCC to “forbear” from applying regulatory mandates where they were no longer
necessary to protect the public interest, and section 11, 47 U.S.C. § 161, required
the agency to review all its regulations every two years and to “repeal or modify
any regulation it determines to be no longer necessary in the public interest.”
Indeed, the entire structure of the 1996 Act highlights Congress’s intention
to immunize the Internet from regulations such as those adopted below. That Act
specifically differentiated between “telecommunications services” (defined to
mean pure transmission offered on a common-carrier basis) and “information

8 Pub L. No. 104-104, Preamble.
10

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services” (defined to mean the offering of transmission combined with processing,
storage, or retrieval of information). 47 U.S.C. § 153(24), (50), (53).
“Telecommunications services” were subjected to extensive mandates under Title
II of the Communications Act, 47 U.S.C. §§ 201-276, whereas “information
services” – a class the FCC has repeatedly held to include the broadband Internet
services at issue here9 – were not expressly subjected to any mandates. See
generally NCTA v. Brand X Internet Services, Inc., 545 U.S. 967, 975 (2005) (the
Communications Act “regulates telecommunications carriers, but not information-
service providers, as common carriers”). The 1996 Act further specified that
information services could not be subject to common-carriage requirements simply
because they were offered by entities that also provided telecommunications
services. See 47 U.S.C. § 153(51). Here, the FCC suggests that the same Congress
that so carefully proscribed application of common-carrier requirements to
information services simultaneously allowed the agency to compel information
service providers to carry all lawful traffic indifferently – i.e., to act as common
carriers. This claim is untenable.

9 See, e.g., High-Speed Access to the Internet Over Cable and Other Facilities, 17
F.C.C.R. 4798 (2002); Appropriate Framework for Broadband Access to the
Internet Over Wireline Facilities
, 20 F.C.C.R. 14853 (2005).
11

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C.

The Actions of Post-1996 Congresses Further
Confirm the FCC’s Lack of Authority

The FCC’s assertion of jurisdiction to impose net neutrality mandates is
further undercut by the actions of post-1996 Congresses. As the Supreme Court
has held, a pattern in which Congress enacts topic-specific legislation revealing a
limited conception of an agency’s authority, and repeatedly considers but rejects
legislation that would expand that authority, “preclude[s] an interpretation” of the
governing statutes that grants the agency the very powers Congress has declined to
confer. See Brown, 529 U.S. at 143-56. Yet this is precisely the interpretation the
FCC advocates.
On several occasions, Congress has found it necessary to grant the FCC
and/or other entities discrete and limited authority over the Internet, demonstrating
its view that the FCC does not enjoy the powers asserted by the Order. For
example:
 In 1998’s Children’s Online Privacy Protection Act, Congress gave
the FTC authority to adopt and enforce rules to ensure children’s
Internet privacy.10
 In 2003’s CAN-SPAM Act, Congress directed the FCC and FTC to
take action to stem the delivery of unsolicited email.11
 In 2008’s Broadband Data Improvement Act, Congress directed the
FCC and other governmental entities to take steps to improve data

10 Pub. L. No. 105-277, §§ 1301-1308.
11 Pub. L. No. 108-187.
12

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regarding broadband deployment, the impact of broadband speeds on
small businesses, and online safety.12
 In 2008’s New and Emerging Technologies 911 Improvement Act,
Congress directed the National E-911 Implementation Coordination
Office to develop “a national plan for migrating to a national [Internet
Protocol]-enabled emergency network capable of receiving and
responding to all citizen-activated emergency communications and
improving information sharing among all emergency response
entities.”13
 In 2009’s American Recovery and Reinvestment Act, Congress
allocated approximately $8 billion in stimulus funding for broadband
deployment and related activities, and directed the Department of
Commerce and the FCC to establish “non-discrimination and network
interconnection obligations” as contractual preconditions for grants.14
 In 2010’s Twenty-First Century Communications and Video
Accessibility Act, Congress imposed accessibility requirements with
respect to mobile Internet browsers, voice over Internet protocol, and
Internet-delivered video content, and authorized the FCC to
implement those requirements via rulemaking.15
These pieces of legislation “have effectively ratified” the view that the FCC
lacked plenary jurisdiction under Section 706 to regulate the Internet. Brown, 529
U.S. at 144. To find otherwise would be to “ignore the plain implication” of
Congress’s post-1996 Internet-specific legislation. Id. at 160.

12 Pub. L. No. 110-385.
13 Pub. L. No. 110-283.
14 Pub. L. No. 111-5.
15 Pub. L. No. 111-260.
13

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Indeed, Congress has “squarely rejected proposals to give the [FCC]”
authority to enact net neutrality regulation more than ten times since 2006
(including once after the Order on review was issued). Id. at 159-60.16 Each of
these bills would have imposed network neutrality mandates or empowered the
FCC to do so. Each, however, either failed to win the support of the relevant
committee or was defeated in the relevant house of Congress.
In addition to these bills, in the months leading up to the Order’s adoption,
Representative Henry Waxman (then Chairman of the House Energy and
Commerce Committee) sought from his colleagues support for draft legislation
bearing striking similarities to the rules ultimately adopted by the FCC. See
Proposed Net Neutrality Legislative Framework, appended hereto as Exhibit 1.
Like the Order on review, that framework would have (1) prohibited wireline ISPs
from “block[ing] lawful content, applications, or services, or prohibit[ing] the use
of non-harmful devices, subject to reasonable network management”; (2) barred
them from “unjustly or unreasonably discriminat[ing] in transmitting lawful
traffic” (again subject to “reasonable network management”); and (3) required
them to “disclose accurate and relevant information in plain language regarding …

16 See H.R. 5252, 109th Cong. (2006); H.R. 5273, 109th Cong. (2006); H.R. 5417,
109th Cong. (2006); S. 2360, 109th Cong. (2006); S. 2686, 109th Cong. (2006); S.
2917, 109th Cong. (2006); S. 215, 110th Cong. (2007); H.R. 5353, 110th Cong.
(2008); H.R. 5994, 110th Cong. (2008); H.R. 3458, 111th Cong. (2009); S. 74,
112th Cong. (2011).
14

USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 25 of 47
price, performance, and network management practices.” Id. Wireless ISPs would
have been prevented from blocking access to “lawful Internet websites” and
“lawful applications that compete with the provider’s voice or video
communications services in which the provider has an attributable interest,” both
subject to reasonable network management. Id. Ultimately, however, Chairman
Waxman declined to introduce the legislation after “[k]ey House Republicans
refused to give their support to [the] draft proposal.”17 At the time, Chairman
Waxman stated that “[i]f Congress can’t act, the FCC must.” Id. Three months
later, FCC Chairman Julius Genachowski acknowledged that the order being
drafted by FCC staff “would build upon the strong and balanced framework
developed by Chairman Henry Waxman.”18 The Order ultimately adopted
replicated that framework.
As FCC Commissioner Meredith Attwell Baker stated in her dissent to the
Order, this approach was not permissible:
The Commission adopts rules that are almost word-for-
word a draft bill under consideration in Congress. We
are a creature of Congress, not Congress itself. Using a
legislative proposal to base our action underscores that
the majority acts beyond the appropriate role of an

17 See Kim Hart, Net Neutrality Bill Stillborn, POLITICO (Sep. 29, 2010),
http://www.politico.com/news/stories/0910/42919.html.
18 Chairman Julius Genachowski, Remarks on Preserving Internet Freedom and
Openness
(Dec. 1, 2010), http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-
303136A1.pdf.
15

USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 26 of 47
independent agency. The majority does what Congress
could not, or would not do.… By definition, the majority
does much more than the proposed draft bill by
exercising its own discretion and judgment. The draft
bill would have given the Commission very specific
responsibilities and powers. In contrast, by doing it
themselves, the majority has created a sweeping Internet
policy without any jurisdictional limits.19
Commissioner Robert McDowell, also dissenting, expressed similar concerns:
“We cannot make laws. Legislating is the sole domain of the directly elected
representatives of the American people. Yet the majority is determined to ignore
the growing chorus of voices emanating from Capitol Hill in what appears to some
as an obsessive quest to regulate at all costs.”20
***

In the text of Section 706 itself, the other provisions of the 1996 Act,
subsequent Internet-specific legislation, and its repeated failure to adopt net
neutrality legislation, Congress has made clear its view that the FCC does not
enjoy the powers it asserts here. This Court therefore should reverse the Order.

19 Order, Dissenting Statement of Commissioner Meredith Attwell Baker, at 18096
(JA __).
20 Id., Dissenting Statement of Commissioner Robert M. McDowell, at 18049 (JA
__).
16

USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 27 of 47

II.

THE ORDER

FALLS OUTSIDE THE SCOPE OF ANY
PURPORTED SECTION 706 AUTHORITY

At most, Section 706 permits the FCC to take actions that have the effect of
promoting broadband deployment. Section 706(a) only authorizes the FCC to
“encourage the deployment” of broadband services “by utilizing … regulating
methods that remove barriers to infrastructure investment.”21 Section 706(b)
directs the FCC, upon finding that broadband is not “being deployed to all
Americans in a reasonable and timely fashion,” to “take immediate action to
accelerate deployment of such capability” in areas lacking deployment.22 The
Order mentions the “deployment” limitation on Section 706’s scope in every one
of its seven paragraphs addressing the FCC’s jurisdiction under that provision.
Order ¶¶117-23 (JA __-__).
The record, however, contained virtually no evidence supporting the FCC’s
theory that net neutrality rules would promote deployment. The FCC relied instead
on speculation that such rules would promote adoption of broadband by non-users,
which in turn would foster new deployments. Order ¶¶14, 53. In so concluding,
the FCC ignored the relevant studies – studies cited elsewhere in the Order, one of
which was authored by the FCC’s own staff – showing that net neutrality
requirements are likely to have no impact on broadband adoption. It also ignored

21 47 U.S.C. § 1302(a).
22 Id. § 1302(b).
17

USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 28 of 47
overwhelming evidence – including declarations submitted by distinguished
economists and numerous economic studies – showing that the rules would inhibit
deployment, saying only that it “disagree[d].” Order ¶40 (JA __). The FCC’s
failure to address the multitude of evidence before it eviscerates its legal theory
and thus invalidates the Order.

A.

The Order

Ignored Extensive Record Evidence
Contradicting Its Speculative Theory That Net
Neutrality Regulation Would Promote
Broadband Adoption and Thus Deployment

The FCC’s theory linking its net neutrality mandates to broadband
deployment directly contradicted the record evidence. Specifically, the Order
asserts that “the Internet’s openness … enables a virtuous circle of innovation in
which new uses of the network – including new content, applications, services, and
devices – lead to increased end-user demand for broadband, which drives network
improvements, which in turn lead to further innovative network uses,” Order ¶14
(JA __), and contends (without citing any support) that “as end users’ confidence
in ISPs’ practices increases, so too should end users’ adoption of broadband
services – leading in turn to additional investment in Internet infrastructure as
contemplated by Section 706,” id. ¶53 (JA __). This claim was entirely
unsupported.23

23 That the FCC could cite no support for its theory is particularly damning given
that, just several days before the comment period closed, its Wireline Competition
(continued on next page)
18

USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 29 of 47
The only evidence in the record undercuts the FCC’s theory. A Working
Paper authored by the Commission’s own staff, and cited elsewhere in the Order,
set out results of a survey that “sought to determine with as much specificity as
possible why people without broadband choose not to have the service at home.”24
That 51-page Report never even used the terms “neutrality,” “open,” “openness,”
“blocking,” or “discrimination,” nor did it otherwise suggest that the absence of net
neutrality rules bore any relationship to broadband adoption. Rather, the Report
found “three primary reasons why the 35 percent of non-adopting Americans do
not have broadband: cost, lack of digital literacy and [the belief that] broadband is
not sufficiently relevant for them to purchase it.” Horrigan Working Paper at 5,
26-31.

(footnote continued)
Bureau entered about 2,000 pages of new documents into the record. See CFIF
12/13/10 Letter (criticizing entry of evidence not subject to adequate public review
and comment). The Order cited those materials liberally with respect to other
points, but the FCC apparently could find no support even there for its position that
net neutrality rules would encourage adoption and further deployment.
24 John B. Horrigan, Broadband Adoption & Use in America, OBI Working Paper
No. 1 (Mar. 2010), at 26, http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-
296442A1.pdf (“Horrigan Working Paper”); see John B. Horrigan, FCC Survey:
Broadband Adoption & Use in America (Mar. 2010),
www.fcc.gov/DiversityFAC/032410/consumer-survey-horrigan.pdf (providing an
overview of the findings of the Horrigan Working Paper), cited in Order ¶53 n.166
(JA __).
19

USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 30 of 47
Another study mentioned in the Order, published by the Pew Internet &
American Life Project, reported similar findings.25 “When asked why they do not
have the internet or broadband at home, non-users (either dialup subscribers or
non-internet users) cite factors related to the Internet’s relevance, availability,
usability, and price.”26 Pew’s Report, like the FCC’s, never used any of the terms
above, or otherwise suggested that any survey respondents had cited net neutrality
concerns among reasons for not adopting broadband.27
As noted, both of these Reports were cited in the Order. They were also
cited and discussed by numerous commenters.28 Yet the Order does not mention
them, much less refute them, in asserting that net neutrality requirements would
lead to increased adoption and increased deployment. Order ¶53 (JA __).
“[S]peculation is an inadequate replacement for the agency’s duty to undertake an

25 Pew Internet & American Life Project, Home Broadband Adoption 2009 (June
2009), cited in Order ¶18 n.43 (JA __).
26 Id. at 7.
27 See generally id. at 7-8 (listing factors mentioned by survey respondents,
including disinterest, lack of access to broadband, expense of service, belief that
Internet use was too difficult, lack of a home computer, lack of time for Internet
use, and the belief that the Internet “is a waste of time”).
28 See, e.g., National Coalition on Black Civic Participation-Black Women’s
Roundtable 2/24/10 Letter, Attachment at 7; Internet Innovation Alliance
1/12/2010 Comments at 1, 6; Rehabilitation Engineering Research Centers on
Universal Interface & Information Technology Access (RERC-IC)
Telecommunications Access (RERC-TA) 4/23/2010 Comments at 2-3. See also
Verizon 10/12/2010 Comments at 51-52 (citing Pew’s 2010 adoption study).
20

USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 31 of 47
examination of the relevant data and reasoned analysis….”29 Nor can the FCC
save its Order by reframing its speculation as prediction; this Court “cannot
overlook the absence of record evidence” supporting the FCC’s theory “simply
because the Commission cast its analysis as a prediction of future trends.”30
Rather, the FCC’s refusal to contend with overwhelming evidence refuting its
theory is a “danger signal[]” suggesting that “the agency has not really taken a
‘hard look’ at the salient problems, and has not genuinely engaged in reasoned
decision-making.” Greater Boston Television Corp. v. FCC, 444 F.2d 841, 851
(D.C. Cir. 1970) (footnote omitted).

B.

The Order

Also Ignored Extensive Record
Evidence that Net Neutrality Regulation Would
Deter Investment and Thus Deployment

Contrary to the FCC’s baseless theory, the record that the FCC ignored made
clear that net neutrality requirements would undercut network investment and
hamstring deployment. The NAM itself argued that net neutrality requirements
“would impose burdens on American manufacturers, stifle the rollout of high-
speed services to unserved and underserved areas, harm American consumers and

29 “Complex” Horsehead Resource Development Co., Inc. v. Browner, 16 F.3d
1246, 1269 (D.C. Cir. 1994). See also NRDC v. EPA, 859 F.2d 156, 210 (D.C. Cir.
1988) (speculation does not constitute “adequate grounds upon which to sustain an
agency’s action”).
30 BellSouth Telecomms, Inc. v. FCC, 469 F.3d 1052, 1060 (D.C. Cir. 2006).
21

USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 32 of 47
prevent the creation of new jobs.”31 Cisco Systems, the world’s largest
manufacturer of networking equipment, explained:
The business rationale for [broadband] investment rests
in no small part on the expectation that providers will be
permitted to develop innovative business plans and
technological offerings that differentiate their networks
from those of their competitors. These expectations have
fueled network deployment thus far, and will likely
continue to do so. A Commission rule barring
“discrimination,” however, would deeply undermine the
prospects for such differentiation, and would in turn
frustrate investment and innovation…. Without any
opportunity for product differentiation, providers would
be denied any measure of confidence in their ability to
recoup such investment, fundamentally altering the
business case for new deployment. In short, the
construction of next-generation broadband networks
would be characterized by extremely high cost and risk,
and limited opportunities for recoupment.32
This view received widespread support in the record: Worries regarding the
likelihood that net neutrality requirements would undermine broadband
deployment were articulated by ISPs,33 the makers of broadband network

31 NAM 4/26/2010 Reply Comments at 1.
32 Cisco 1/14/2010 Comments at 6.
33 See, e.g., Verizon 1/14/2010 Comments at 43; Independent Telephone &
Telecommunications Alliance1/14/2010 Comments at 10; National
Telecommunications Cooperative Association 1/14/2010 Comments at 9; General
Communications Inc. 11/4/2010 Reply Comments at 3; WCAI 1/14/2010
Comments at 4.
22

USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 33 of 47
components,34 and coalitions representing racial and ethnic minorities and other
groups.35 In a related docket, the United States Department of Justice cautioned
that excessive regulation could “stifl[e] the infrastructure investments needed to
expand broadband access.”36
Even more significant were the many declarations and economic studies
submitted into and/or discussed in the record confirming what manufacturers and
service providers knew from experience – namely, that net neutrality regulation
would deter deployment. These included the following:
 A Declaration by Nobel Prize-winning economist Gary Becker and
former DOJ Chief Economist Dennis Carlton stating that
“[i]mposition of net neutrality rules that limit experimentation with
new business models and network management practices will prevent
network operators from enhancing the functionality of the their
networks and will undermine the business case for investing in higher
capacity broadband networks.”37
 A Declaration by former FCC Chief Economist Michael Katz
explaining that “public policies that reduce the financial returns to
investment weaken private investment incentives” and concluding
that, among other things, imposition of net neutrality rules of the sort

34 Telecommunications Industry Association 1/14/2010 Comments at 25-26;
Telecom Manufacturer Coalition 1/14/2010 Comments at 2-3.
35 See Coalition of Minority Chambers 1/13/10 Letter; National Organizations
1/14/10 Comments at 19.
36 DOJ 1/4/2010 Letter in FCC Docket No. 09-51 at 28, quoted in Verizon
12/3/2010 Letter, Attachment at 16.
37 Becker/Carlton Decl. ¶66, appended as Attach. A to Verizon 1/14/2010
Comments. See also Becker/Carlton Reply Decl., appended as Attach. A to
Verizon 4/26/2010 Reply Comments.
23

USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 34 of 47
the FCC was considering “would be expected to attenuate investment
incentives, harming competition and consumers.”38
 A Declaration by Dr. Marius Schwartz, who is now Chief Economist
of the FCC’s Wireline Competition Bureau, concluding that net
neutrality requirements “would discourage broadband deployment and
use.”39
 A Declaration by economist Michael Topper concluding that
“[n]etwork neutrality regulations would … have the adverse
consequence of deterring network investment by broadband access
providers.”40
 A Declaration by the Chief Corporate Chief Technology Officer of
leading telecommunications component manufacturer Alcatel-Lucent
explaining that “[n]etwork operators’ network investment decisions
are naturally tied to their expectations with respect to returns on that
investment,” and that net neutrality rules “are likely to have a
significant effect on investment decisions going forward.”41
 An article coauthored by economist Robert Crandall and computer
scientist David Farber concluding that net neutrality requirements
“would certainly result in reducing ISP incentives to invest or
innovate in performance-enhancing network capabilities.”42

38 Katz Decl. ¶¶30, 98, appended as Attach. B to Verizon 1/14/2010 Comments.
See also Katz Reply Decl., appended as Attach. B to Verizon 4/26/2010 Reply
Comments.
39 Schwartz Decl. ¶24-25, appended as Exhibit 3 to AT&T 1/14/2010 Comments.
40 Topper Decl. ¶123, appended as Attach. C to Verizon 1/14/2010 Comments. See
also
Topper Reply Decl., appended as Attach. C to Verizon 4/26/2010 Reply
Comments.
41 Weldon Decl. at 9, appended to Telecommunications Industry Association
1/14/2010 Comments.
42 Faulhaber/Farber Decl. at 19, appended as Ex. 1 to AT&T 1/14/2010 Comments.
24

USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 35 of 47
 A white paper issued by the Phoenix Center for Advanced Legal &
Economic Policy Studies using economic modeling to demonstrate
that net neutrality requirements “will unquestionably result in lower
broadband network construction across the board,” and that
“deployment in high-cost areas will be harmed disproportionately by
any such cost-increasing mandate.”43
 An empirical study by economists Thomas Hazlett and Anil Caliskan
examining “evidence from the U.S. residential broadband market” and
concluding that prior instances of broadband regulation have
undermined deployment of new network facilities.44
 An paper by economists Larry Darby and Joseph Fuhr, Jr., explaining
that “investors have a big stake in the resolution of net neutrality
issues and particularly in the outcome of the debate over who can be
charged, by what principles and by whom,” and stating that “[t]he
importance of investor attitudes about the broadband build-out can
scarcely be overemphasized….”45
 A paper authored by communications economists Robert Crandall and
Hal Singer observing that “both the initial establishment of the
network and its ongoing management require significant investment,”

43 George Ford et al., The Burden of Network Neutrality Mandates on Rural
Broadband Deployment
, Phoenix Center Policy Paper No. 25 at 18 (2006),
discussed and linked in Independent Telephone & Telecommunications Alliance
4/26/2010 Reply Comments at 7.
44 Thomas Hazlett and Anil Caliskan, Natural Experiments in U.S. Broadband
Regulation
, 7 REVIEW OF NETWORK ECONOMICS 460, 477-78 (2008), cited in
Verizon 4/26/2010 Reply Comments at 43 n.41.
45 Larry Darby and Joseph Fuhr, Jr., Consumer Welfare, Capital Formation and
Net Neutrality: Paying for Next Generation Broadband Network
, 16 MEDIA L. &
POL’Y 141 (2007), cited in National Organizations 1/14/2010 Comments at 19-20
n.72.
25

USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 36 of 47
and concluding that “[n]et neutrality regulation is … likely to reduce
innovation in … the development of network infrastructure….”46
In the face of such voluminous record evidence demonstrating that net
neutrality requirements would inhibit investment and deployment (and thus could
not be adopted under the auspices of Section 706), the Order stated simply that the
FCC “disagree[d].” It then offered a single-sentence rejoinder, claiming (without
any analysis) that “[t]here is no evidence that prior open Internet obligations have
discouraged investment” and citing arguments that “by preserving the virtuous
circle of innovation, open Internet rules will increase incentives to invest in
broadband infrastructure.” Order ¶40 (JA __). Its purported sources for these
propositions, moreover, were off-point. For example, the FCC cited comments
stating that a non-binding FCC policy statement had not deterred investment.47
Other cited comments expressly disclaimed any suggestion of “causality” between
net neutrality mandates and investment.”48 The Order cited repeatedly to
comments filed by Google on this point, but its comments expressly acknowledged
that net neutrality rules would deter broadband network investment.49

46 Robert Crandall and Hal Singer, The Economic Impact of Broadband Investment
at 52-53 (2010), cited and linked in Swanson 4/26/2010 Reply Comments at 11
n.2.
47 See Google 1/14/2010 Comments at 38-39; XO 1/14/2010 Comments at 12.
48 See Free Press 1/14/2010 Comments at 26.
49 See Google 1/14/2010 Comments at 41 (graphic).
26

USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 37 of 47
Of course, the Order would be unlawful even if the sources it cited
supported its view. The FCC may not brush aside voluminous evidence going to
the heart of its legal authority by asserting its mere “disagree[ment]” and invoking
comments favoring its position. In refusing to acknowledge or address the
plentiful evidence discussed above, the FCC has “entirely failed to consider an
important aspect of the problem,” adopting a view of broadband deployment that
“runs counter to the evidence before the agency.” Motor Vehicle Manufacturers
Ass’n v. State Farm Mutual Automobile Ins. Co., 463 U.S. 29, 43 (1983). This
Court “should not attempt itself to make up for such deficiencies,” id., but rather
must strike down the FCC’s unlawful arrogation of power.
***
The FCC’s central claim to legal authority relies on assertions regarding the
linkage between net neutrality requirements and broadband deployment that were
comprehensively refuted by record evidence that the Order simply refused to
address. This failure to contend with key evidence speaking to the very basis for
the agency’s purported authority constitutes reversible error.
27

USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 38 of 47

CONCLUSION

For the reasons stated herein and in the Verizon/MetroPCS brief, the Court
should reverse and vacate the Order.
Respectfully submitted,
/s/ Russell P. Hanser
Quentin Riegel
Russell P. Hanser
NATIONAL ASSOCIATION
Bryan N. Tramont
OF MANUFACTURERS
WILKINSON BARKER KNAUER, LLP
733 10th Street, N.W.
2300 N Street, N.W.
Suite 700
Suite 700

Washington, DC 20001
Washington, DC 20037
(202) 637-3058
(202) 783-4141
Counsel for the National Association
of Manufacturers

28

USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 39 of 47

EXHIBIT 1

Proposed Net Neutrality Framework

USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 40 of 47

Proposed Net Neutrality Legislative Framework


SEC. 1 SHORT TITLE

.—This Act may be cited as the “__________________Act of 2010.’’

SEC. 2 INTERNET OPENNESS.


Title I of the Communications Act of 1934 (47 U.S.C. 151 et seq.) is amended by adding
at the end thereof the following new section:

“SEC. 12 INTERNET OPENNESS.


“(a) DUTIES OF WIRELINE PROVIDERS.—A person engaged in the provision of broadband
Internet access service by wire, insofar as such person is so engaged—


“(1) shall not block lawful content, applications, or services, or prohibit the use of
non-harmful devices, subject to reasonable network management;


“(2) shall not unjustly or unreasonably discriminate in transmitting lawful traffic
over a consumer’s wireline broadband Internet access service. For purposes of this
subparagraph, reasonable network management practices shall not be construed to be
unjustly or unreasonably discriminatory.


“(3) shall disclose accurate and relevant information in plain language regarding
the price, performance, and network management practices of its wireline broadband
Internet access services sufficient for consumers to make informed choices regarding use
of such services and for content, application, service, and device providers to develop and
market new Internet offerings. The Commission shall not require public disclosure of
competitively sensitive information or information that could compromise network
security or undermine the efficacy of reasonable network management practices]. In
promulgating rules implementing this subparagraph, the Commission shall at minimum
require providers to display or provide links to the required information on an Internet
website and to update such information in a timely fashion to reflect material changes in
the information subject to this paragraph.

“(b) DUTIES OF WIRELESS PROVIDERS.— A person engaged in the provision of broadband
Internet access service by radio, insofar as such person is so engaged—

“(1) shall not block consumers from accessing lawful Internet websites, subject to
reasonable network management;

“(2) shall not block lawful applications that compete with the provider’s voice or
video communications services in which the provider has an attributable interest, subject
to reasonable network management; and

“(3) shall disclose with regard to its wireless broadband Internet access services
the same information required of wireline broadband Internet access service by paragraph

USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 41 of 47

12(a)(3).

“Paragraph (2) shall not apply to wireless broadband Internet access service providers to the
extent they are engaged in the operation of application stores or their functional equivalent.


“(c) ENFORCEMENT—


“(1) COMMISSION AUTHORITY.—The Commission shall enforce the duties
established in subparagraphs 12(a)(1), (a)(2), (b)(1) and (b)(2), through adjudication of
complaints alleging a service or services violate such subparagraphs. Nothing in this
section limits the Commission’s authority to adopt procedures for the adjudication of
complaints, to adopt orders requiring compliance from an entity subject to a complaint or
enforcement actions, or to issue declaratory rulings or guidance.

“(2) INJUNCTIVE RELIEF AND PENALTIES.— If the Commission finds that a
provider of broadband Internet access service has violated paragraphs (a) or (b), the
Commission may issue an order enjoining such violation, including interim injunctive
relief. If the Commission finds that a provider of broadband Internet access service has
engaged in a willful and knowing violation of paragraphs (a) or (b), the Commission may
issue a fine or forfeiture of no more than $2,000,000 for any practice found to violate
paragraphs (a) or (b), consistent with the procedures in Section 503 of the
Communications Act. The Commission may not order the payment of damages for any
violation of paragraphs (a) or (b).

“(3) NO ADDITIONAL PRIVATE RIGHTS AUTHORIZED.—Nothing in this section shall
be construed to authorize any private right of action.


“(d) RELATIONSHIP TO OTHER TITLES AND LAWS —

“(1) THE COMMISSION.— The Commission may not impose regulations on
broadband Internet access service or any component thereof under Title II of the
Communications Act, except in the event that a provider of broadband Internet access
service elects to provide the transmission component of such service as a
telecommunications service under Title II of the Communications Act. Except as
expressly provided in this section, nothing in this section shall increase, reduce, or
otherwise alter the Commission’s authority.

“(2) PROVIDERS.— Nothing in this section supersedes any obligation or
authorization a provider of broadband Internet access service may have to address the
needs of emergency communication, law enforcement, public safety, or national security,
consistent with applicable law, or limits the provider's ability to do so. Nothing in this
section shall prohibit reasonable efforts by a provider of broadband Internet access
service to address copyright infringement or other unlawful activity.

“(e) REPORT TO CONGRESS—No later than December 31, 2011, the Commission shall
deliver to the Committee on Energy and Commerce of the House of Representatives and U.S.
Senate Committee on Commerce, Science, & Transportation recommendations with regard to
2


USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 42 of 47

additional authority needed by the Commission to implement the National Broadband Plan and
to ensure further the protection of consumers in their use of Internet services.

“(f) TERM OF AUTHORITY—This section shall expire on December 31, 2012, provided
that the Commission may continue to adjudicate cases regarding violations that occurred prior to
January 1, 2013, that are filed at the Commission no later than March 1, 2013.


“(g) DEFINITIONS—For purposes of this section:


“(1) BROADBAND INTERNET ACCESS SERVICE –The term ‘broadband Internet
access service’ means:

“(A) A mass market retail service, by wire or radio, that provides high-speed
capability to transmit data to and receive data from all or substantially all Internet
endpoints, including any associated information-processing capabilities; or

“(B) A service that the Commission finds provides consumers a functional
equivalent to the service described in subparagraph (A) or and evades the consumer
protections set forth in this section.

“(2) HIGH-SPEED.—The term ‘high-speed’ shall have the meaning given to it in
the Commission’s Fifth Report on the Deployment of Advanced Telecommunications
Capability to All Americans, FCC 08-88 (rel. June 12, 2008).

“(3) REASONABLE NETWORK MANAGEMENT. – The term “reasonable network
management” means a network management practice that is appropriate and tailored to
achieving a legitimate network management function, taking into account the particular
network architecture or technology of the provider. It includes appropriate and tailored
practices to reduce or mitigate the effects of congestion on a broadband Internet access
provider’s network; to ensure network security or integrity; to address traffic that is
harmful to or unwanted by users, including premise operators, or to the provider’s
network, or the Internet; to meet the needs of public safety; and to provide services or
capabilities to effectuate a consumer’s choices, including parental controls or security
capabilities. In determining whether a network management practice is reasonable, the
Commission shall consider technical requirements, standards, or best practices adopted
by one or more independent, widely-recognized Internet community governance initiative
or standard-setting organization. In determining whether a network management practice
for wireless broadband Internet access service is reasonable, the Commission shall also
consider the technical, operational, and other differences between wireless and other
broadband Internet access platforms, including the need to ensure the efficient use of
spectrum.

The FCC shall determine the treatment of fixed wireless and satellite services for the purposes of
this section.
3


USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 43 of 47

CERTIFICATE OF COMPLIANCE

Pursuant to F.R.A.P. 32(a)(7)(C) and D.C. Cir. R. 32(a)(2)(C), I hereby
certify that the foregoing brief complies with the type-volume limitation of D.C.
Cir. R. 32(a)(2)(B)(i), F.R.A.P. 29(d), and the May 25, 2012 Order in this docket
because this brief contains 5922 words, excluding the parts of the brief exempted
by F.R.A.P 32(a)(7)(B)(iii) and D.C. Cir. R. 32(a)(1). This certification is made in
reliance on the word count function of the word processing system used to prepare
this brief (Microsoft Word 2010).
Further, I certify that the foregoing brief complies with the typeface
requirements of F.R.A.P. 32(a)(5) and the type style requirements of F.R.A.P.
32(a)(6) because this brief has been prepared in a proportionally spaced typeface
(14-point Times New Roman).
/s/ Russell P. Hanser
Russell P. Hanser
July 23, 2012

USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 44 of 47

CERTIFICATE OF SERVICE

I hereby certify that on July 23, 2012, I caused copies of the foregoing

BRIEF FOR AMICUS CURIAE NATIONAL ASSOCIATION OF

MANUFACTURERS IN SUPPORT OF PETITIONERS-APPELLANTS

to be
to be filed with the Clerk of the United States Court of Appeals for the D.C. Circuit
via the Court’s CM/ECF system, which will send notice of such filing to all
counsel who are registered CM/ECF users. Other counsel, marked with an asterisk
below, will receive service by mail.
Carl W. Northrop
Mark A. Stachiw
Michael Lazarus
General Counsel, Secretary & Vice
*Andrew Morentz
Chairman
MetroPCS Communications, Inc.
Telecommunications Law
2250 Lakeside Blvd.
Professionals PLLC
Richardson, TX 75082
875 15th Street, NW, Suite 750
Washington, DC 20005
Counsel for MetroPCS
Communications, Inc., et al.

Counsel for MetroPCS
Communications, Inc., et al.
Helgi C. Walker
Michael E. Glover
William S. Consovoy
Edward Shakin
Eve Klindera Reed
William H. Johnson
Brett A. Shumate
Verizon
Wiley Rein LLP
1320 North Courthouse Road, 9th Floor
1776 K Street, NW
Arlington, VA 22201
Washington, DC 20006
Counsel for Verizon
Counsel for Verizon

USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 45 of 47
John T. Scott, III
Walter E. Dellinger
Verizon Wireless
Brianne Gorod
1300 I Street, NW
Anton Metlitsky
Suite 400 West
O’Melveny & Myers LLP
Washington, DC 20005
1625 Eye Street, NW
Washington, DC 20006
Counsel for Verizon
Counsel for Verizon
Samir C. Jain
Sean Lev*
Wilmer Cutler Pickering, et al.
Peter Karanjia
1875 Pennsylvania Avenue, NW
Jacob M. Lewis
Washington, DC 20006
Richard K. Welch
Joel Marcus
Counsel for Verizon
FCC Office of General Counsel
445 12th Street, SW
Washington, DC 20554
Counsel for FCC
James Bradford Ramsay
Genevieve Morelli
General Counsel
Independent Telephone &
National Association of Regulatory
Telecommunications Alliance
Utility Commissioners
1101 Vermont Avenue, N.W.
1101 Vermont Avenue
Suite 501
Suite 200
Washington, DC 20005
Washington, DC 20005
Counsel for ITTA
Counsel for NASUCA
Henry Goldberg
Harold J. Feld
Goldberg, Godles, Wiener & Wright
Public Knowledge
1229 Nineteenth Street, NW
1818 N Street, NW
Washington, DC 20036
Suite 410
Washington, DC 20036
Counsel for Open Internet
Coalition
Counsel for Public Knowledge
Michael F. Altschul
Matthew F. Wood
CTIA – The Wireless Association®
Free Press
1400 16th Street, NW
1025 Connecticut Avenue, NW
Suite 600
Suite 1110
Washington, DC 20036
Washington, DC 20036
Counsel for CTIA – The Wireless
Counsel for Free Press
Association®

USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 46 of 47
Nancy C. Garrison
R. Craig Lawrence
Catherine G. O’Sullivan
U.S. Attorney’s Office
Robert J. Wiggers
555 4th Street, NW
U.S. Department of Justice
Washington, DC 20530
Antitrust Div., Appellate, Rm. 3224
950 Pennsylvania Avenue, NW
Counsel for the United States
Washington, DC 20530-0001
Counsel for the United States
Jonathan E. Nuechterlein
Jeffrey J. Binder
Elvis Stumbergs
Law Office of Jeffrey Binder
Heather M. Zachary
2510 Virginia Avenue, NW
Wilmer Cutler Pickering Hale and
Suite 1107
Dorr, LLP
Washington, DC 20037
1875 Pennsylvania Avenue, NW
Washington, DC 20006-1420
Counsel for Vonage Holdings Corp.
Counsel for CTIA – The Wireless
Association®
E. Duncan Getchell, Jr.
Brendan Daniel Kasper
*Wesley Glenn Russell, Jr.
*Kurt Matthew Rogers
Office of the
Vonage Holdings Corp.
Attorney General
23 Main Street
900 East Main Street
Holmdel, NJ 07733
Richmond, VA 23219
Counsel for Vonage Holdings Corp.
Counsel for the Commonwealth of
Virginia
John P. Elwood
David Bergmann
Eric A. White
Assistant Consumers’ Counsel
Vinson & Elkins LLP
Chair, NASUCA Telecommunications
2200 Pennsylvania Avenue, NW
Committee
Suite 500 West
Office of the Ohio Consumers’ Counsel
Washington, DC 20037
10 West Broad Street, Suite 800
Columbus, OH 43215
Counsel for the Cato Institute,
Competitive Enterprise Institute, Free
Counsel for NASUCA
State Foundation, and TechFreedom

USCA Case #11-1355 Document #1385089 Filed: 07/23/2012 Page 47 of 47
James Ramsay
Stephen B. Kinnaird
National Association of Regulatory
Paul. Hastings, Janofsky & Walker LLP
Utility Commissioners
875 15th Street, NW
1101 Vermont Avenue, NW
Washington, DC 20005
Suite 200
Washington, DC 20005
Counsel for MetroPCS
Counsel for NASUCA
/s/ Russell P. Hanser
Russell P. Hanser

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