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Comcast Corp. v. FCC, 600 F.3d 642, is a 2010 United States Court of Appeals for the District of Columbia case, holding that the FCC did not have ancillary jurisdiction over Comcast’s Internet service under the language of the Communications Act of 1934. In doing so, the Court vacated the 2008 order issued by the FCC that asserted jurisdiction over Comcast’s network management polices and censured Comcast from interfering with its subscriber's use of peer-to-peer software.

Background
In 2007, several subscribers of Comcast high-speed Internet discovered that Comcast was interfering with their use of peer-to-peer networking applications. Challenging Comcast’s interference, Free Press and Public Knowledge--two non-profit advocacy organizations--filed a complaint with the FCC. The complaint stated that Comcast’s actions violated the FCC Internet Policy Statement, particularly violating the statement’s principle that “consumers are entitled to access the lawful Internet content of their choice. . . [and] to run applications and use services of their choice.” Comcast defended its interference with peer-to-peer programs as necessary to manage scarce network capacity.

Following this complaint, the FCC issued an order censuring Comcast from interfering with subscriber’s use of peer-to-peer software--FCC’s first attempt to enforce its network neutrality policy. The order began with the FCC stating it had jurisdiction over Comcast’s network management practices under the Communications Act of 1934 (47 U.S.C. § 154). Specifically, the Communications Act of 1934 granted the FCC the power to "perform any and all acts, make such rules and regulations, and issue such orders, not inconsistent with [the Act], as may be necessary in the execution of its functions." Next, the FCC ruled that Comcast impeded consumers ability to access content and use applications of their choice. Additionally, because other options were available for Comcast to manage their network policy without discriminating against peer-to-peer programs, Comcast’s method of bandwidth management breached federal policy.

Comcast complied with the order and appealed.

Opinion of the Court
The D.C. Circuit Court of Appeals held that the FCC failed to justify its exercise of  ancillary authority to regulate ISP's network management practices. For an issue to fall within an agency’s authority, the agency need only have ancillary authority—a sufficient statutory support requesting the agency at least take action in the first instance of the issue. Here, the Court did not find a sufficient statutory basis under the Communications Act of 1934 for the FCC’s mandate to regulate the behavior of Internet service providers.

The Court relied on two-part test for ancillary authority, laid out in ''Am. Library Ass’n v. FCC'' : A commission may exercise ancillary authority only if “(1) the Commission’s general jurisdictional granted under Title I [of the Communications Act] covers the regulated subject and (2) the regulations are reasonably ancillary to the Commission’s effective performance of its statutorily mandated responsibilities.”

Although Comcast conceded that the FCC satisfied the first prong, the court ruled that the FCC failed to satisfy the second prong. The FCC failed to show that its action of barring Comcast from interfering with its customer’s peer-to-peer use was reasonable ancillary to the effective performance of its statutorily-mandated authority. Instead, the FCC relied on a Congressional statement of policy and various provisions of the Communications Act—neither of which the Court found created “statutorily mandated responsibilities.” Additionally, by accepting FCC’s argument, the court believed it would “virtually free the Commission from its congressional tether,” thereby providing the FCC an almost unbounded limit to impose regulations on Internet service providers.

Significance of the Decision
The FCC Order against Comcast was FCC's first attempt to impose rules requiring network neutrality among ISPs. But in a unanimous decision, the Court found that the FCC lacked the power to enforce these rules. Not only does this affect the administrability of FCC’s current network neutrality rule, but it could also affect a wide variety of broadband issues, such as ensuring ISPs do not block websites like Hulu or YouTube or enforcing ISP’s advertised broadband speeds.

Further, the court’s decision may prompt Congress and FCC to establish new rules or laws regarding internet regulations. Congress may decide to intervene and more concretely establish FCC’s authority to regulate internet services and service providers. Additionally, the FCC may attempt to reclassify internet services as the more heavily regulated “telecommunications service” under Title II of the Communications Act—a move strongly opposed by several internet service providers.

Comcast's Reaction
Comcast issued the following statement—attributable to Comcast’s spokeswoman Sena Fitzmaurice:

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FCC's Reaction
The FCC released the following statement regarding the Comcast v. FCC decision:

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