The FCC attempted to throw the kitchen sink at the Court, creating new interpretations of their “ancillary jurisdiction” over the Internet and tossing in a variety of federal laws and policy statements to back up their case. Yet, the court shot back at virtually every argument presented, stating "the Commission’s attempt to dictate the operation of an otherwise unregulated service...defies any plausible notion of 'ancillariness.'"
Perhaps most importantly, the Court called out the FCC for blatantly attempting to broaden their authority well beyond the legal bounds. Justices stated that if in prior court cases the FCC “strained the outer limits of even the open-ended and pervasive jurisdiction," in this attempt “it seeks to shatter them entirely.” The Justices conclude by stating:
Notwithstanding the “difficult regulatory problem of rapid technological change”…“the allowance of wide latitude in the exercise of delegated powers is not the equivalent of untrammeled freedom to regulate activities over which the statute fails to confer…Commission authority.”
So, what’s the next step for the FCC? If in this case they sought to “shatter” the bounds of their jurisdiction, prepare for FCC Chairman Genachowski to try to recreate the bounds of their jurisdiction. As we’ve noted before, FCC has long determined the Internet is an “information service” and should be treated as such under Title I of the Communications Act (see here, here, here, and here). But this Title I “ancillary jurisdiction” is essentially what brought them down. So, instead of appropriately seeking Congressional approval, expect them to find a way to regulate the Internet under Title II of the Communications Act. This would put the Net under an outdated regulatory scheme designed for traditional phone lines, giving them a better shot of enacting Net Neutrality, as well as regulating Internet speed, pricing, and taxes, amongst other things. After all, they already tossed the idea into their National Broadband Plan.
In the meantime, this decision finally puts the FCC and Chairman Genechowski in their place; striking at the self-aggrandizing and priestly view that they are somehow above the law.