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 Perspectives from FSF Scholars                     June 1, 2011
 Vol. 6, No. 13

Tethering the FCC:

The Case Against Chevron Deference for Jurisdictional Claims




Daniel A. Lyons*



Daniel Lyons, a member of the faculty at Boston College Law School, specializes in communications law and administrative law. He is a member of the Free State Foundation's Board of Academic Advisors. In this latest in the Perspectives from FSF Scholars series, Profressor Lyons contends that "the FCC's new regulatory initiatives stretch the boundaries of the Commission's jurisdiction under the Communications Act and ought not to be accorded Chevron deference upon judicial review." A complete PDF version of Professor Lyons' Perspectives with footnotes is here, and the introduction to his paper is immediately below.



"Despite the Administration's recent rhetoric about regulatory review, regulation and re-regulation seems destined to be a primary theme of President Obama's first term. From the financial markets and consumer lending to the health care industry, the President and Congress have enacted statutes designed to curb what they saw as prior Administrations' deregulatory excesses. The Federal Communications Commission has been an eager participant in this regulatory and re-regulatory wave: since 2009, under Chairman Genachowski's leadership, the agency has adopted several new initiatives, ranging from a proposal to regulate set-top box video navigation devices to various measures to regulate wireless services. Perhaps most significantly and controversially, the Commission has imposed new net neutrality regulatory mandates on broadband Internet providers. As this paper shows, the FCC's new regulatory initiatives stretch the boundaries of the Commission's jurisdiction under the Communications Act and ought not to be accorded Chevron deference upon judicial review.


Unlike its counterparts at the SEC or Health and Human Services, the FCC is expanding its jurisdiction without a clear congressional mandate. The distinction is important because the telecommunications world has changed dramatically since Congress last overhauled the Communications Act in 1996 -- an overhaul that was largely deregulatory in focus and intent, if not always in practical effect. This jurisdictional freelancing by the FCC is familiar to veterans of past telecommunications policy battles, in particular the Commission's efforts to regulate the cable industry. The Commission initially foreswore any jurisdiction over cable, but as the industry expanded, the agency used its so-called 'ancillary authority' to foist a labyrinthine set of rules on cable operators. The Supreme Court upheld certain rules but ultimately determined that the agency lacked the authority to regulate the industry comprehensively without a clear grant of authority from Congress. Thus far, the Commission's efforts to impose net neutrality regulation have met a similar fate.


This history, and the Commission's current push to expand its jurisdiction, highlight an important but often ignored tension in administrative law. The Chevron doctrine generally requires courts to defer to an agency's interpretation of ambiguous language in a statute that the agency administers. Chevron is premised on the assumption that agencies, not courts, should 'fill any gap left . . . by Congress' in the agency's organic statute. But it strains the doctrine to apply Chevron to an agency's conclusions about the scope of its jurisdiction. In these cases, the agency is not merely filling a gap within a statutory framework, but is instead defining the outer limits of that framework. There is a difference in kind between the policy question 'what rules should govern broadband?' and the legal question 'does the Communications Act allow the Commission to make rules governing broadband?' Courts appropriately defer to agency expertise when answering the former question, but should reserve the latter question for 'the province . . . of the judicial department.'


In the telecommunications context, courts have often viewed the Commission's efforts to expand its jurisdiction with skepticism, even though they have not reconciled their decisions with Chevron's seeming grant of near-plenary authority to agencies in such matters. This judicial skepticism is well-grounded. Chevron extends only to questions that Congress intended the agency to resolve. The nondelegation doctrine should prohibit Congress from delegating to the agency the power to determine its own jurisdiction. Agencies are designed to resolve policy questions, and are predisposed to find jurisdiction when they feel, as a matter of policy, that regulation would be useful.


The overwhelming statutory evidence suggests that Congress has not (yet) intended to give the agency general regulatory authority over broadband Internet services, no matter how much (as a policy matter) the Commission feels it needs this authority. It would be a mistake for courts to defer to the agency's conclusion otherwise because of a misappropriation of the Chevron doctrine. Therefore, as the Commission's net neutrality project winds its way through the judicial system, courts should not hesitate to review independently whether the agency's efforts remain within the Communications Act's confines."



*Daniel A. Lyons, a member of the Board of Academic Advisors for the Free State Foundation, is an Assistant Professor of Law at Boston College Law School.


The Free State Foundation is a nonpartisan Section 501(c)(3) free market-oriented think tank located in Rockville, Maryland.



Read the complete Perspectives with footnotes here.


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