Net Neutrality: The FCC's Authority to Regulate Broadband Internet Traffic Management [March 26, 2014] [open pdf - 293KB]
"A major debate over the government's role with respect to the regulation of the Internet is currently occurring. Legally, one of the biggest questions is to what extent the Federal Communications Commission (FCC or Commission) currently has the authority to regulate the ways in which Internet service providers (ISPs) manage Internet traffic over their networks. On December 21, 2010, the Commission adopted new open Internet rules in its Open Internet Order. The rules required broadband Internet service providers to disclose their network traffic management policies and prohibited them from blocking any lawful content from travelling over their networks. Furthermore, the rules prohibited fixed broadband Internet service providers from unreasonably discriminating against any particular content. The rules were challenged in federal court by a number of different industry participants. Verizon, in its suit, argued that, policy considerations aside, the FCC had not asserted adequate statutory authority to issue the rules. In January of 2014, the Court of Appeals for the District of Columbia issued a decision finding that the FCC did have the authority under Section 706 of the Telecommunications Act of 1996 to issue the rules. However, the court vacated both the antiblocking and anti-discrimination rules, nonetheless. The court found that, although the FCC had reasonably interpreted the authority granted to it by Section 706, the agency could not promulgate rules under that section that otherwise violated the Communications Act of 1934. Because the anti-blocking and anti-discrimination rules were prohibited by another portion of the Communications Act, the court struck down the rules."
CRS Report for Congress, R40234