A recent federal court decision held Maine's law restricting how cable operators bill their customers to be "unambiguously preempted" by the 1984 Cable Act. State Attorney General Aaron Frey in response has agreed to stand down at the district court level, but an appeal is expected.
As I described in a June post to the Free State Foundation's blog, earlier this year Maine enacted misguided legislation requiring cable operators, but not other providers of video content, to provide refunds to subscribers who cancel their service in the middle of a monthly billing cycle. Charter Communications, Inc. and its local subsidiary ("Charter") challenged that law before the United States District Court of Maine.
As I noted in a recent Perspectives from FSF Scholars, on October 7, the United District Court of Maine agreed that the law indeed does regulate "rates for the provision of cable service" – and therefore is "unambiguously preempted" by Sections 623(a)(2) and 636(c) of the 1984 Cable Act.
Rather than continue to fight this out before the district court, Maine's Attorney General and Charter together filed a Joint Motion to Grant Summary Judgment to Plaintiffs and Enter Final Judgment. On November 2, the court granted that motion.
The state AG has preserved his right to appeal the district court's decision, and such a challenge is expected. Until then, however, the law will not be enforced.
Without question this is the right outcome. Nearly four decades ago, Congress made clear its intention that competition, rather than regulation, should keep cable rates in check. In 2020, robust rivalries in the video distribution marketplace effectively perform that role.
By contrast, legislation targeting cable operators but not their rivals – Direct Broadcast Satellite (DBS) operators, telco TV providers, Internet-based streaming services, multicasting broadcasters, and others – only interferes with the pro-consumer operation of marketplace forces.
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