On December 16, the Supreme Court issued an order denying a petition for certiorari in New York State Telecommunications Association v. James. The petition presented the question of whether the Communications Act preempts New York's broadband rate-regulation law. The Court's order leaves in place an April 2024 decision by the U.S. Court of Appeals for the Second Circuit rejecting ISPs' claims that the New York rate regulation law was subject to field preemption and conflict preemption.
New York's Affordable Broadband Act imposes price ceilings – a type of rate regulation – on broadband Internet service providers (ISPs) offering service in the state. Under the state's law, ISPs must offer $15-per-month and $20-per-month plans to low-income individuals.
My summary of the lower court's decision in NYTSA v. James is provided in my May 3 Perspectives from FSF Scholars, "Second Circuit Rejects Preemption Challenge to New York's Broadband Rate Regulation." As explained in my August 28 blog post, when the Second Circuit issued its decision in NYSTA v. James, it was widely expected to have a short life because the decision was based on the FCC's Title I "information services" classification of broadband Internet access services under the Restoring Internet Freedom Order. The court's decision was issued only a day after the agency repealed the RIF Order and made its Title II "telecommunications services" reclassification decision in the Securing and Safeguarding the Open Internet Order.
However, the Sixth Circuit's August 1 order in MPC No. 185 Open Internet Rule has stayed the new Title II Order pending a decision on the merits in that case. Oral arguments in that case were held before the Sixty Circuit on October 31. Thus, broadband Internet access services remain Title I "information services" for now. Also, the electoral victory of President-elect Donald Trump and his nomination of Commissioner Brendan Carr to be the next Chairman of the FCC is likely to ensure that broadband services remain Title I "information services" for the foreseeable future.
At this point, it is difficult to make predictions. As a result of the court's denial of certaiorari in NYSTA v. James, it appears that New York's rate regulation law may go into effect in the near future. But a newly-constituted FCC, under the leadership of Chairman Brendan Carr, is likely to take a different view about the preemptive effect of the Commission's Title I classification decision than the Second Circuit -- and may act on those views through a future declaratory ruling or by some other means. Due to the upcoming change in the Administration, NYTSA v. James is not likely to be the last word on the subject of federal preemption and state-level rate regulation of broadband services.
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