Court strikes down FCC anti-discrimination rule opposed by Internet providers

The FCC defined discrimination in broadband access as “policies or practices, not justified by genuine issues of technical or economic feasibility, that differentially impact consumers’ access to broadband Internet access service based on their income level, race, ethnicity, color, religion, or national origin or are intended to have such differential impact.”

The rules applied to broadband providers and other entities, such as landlords that restrict broadband options in a building even when multiple providers are available. “Conduct by entities other than broadband providers might impede equal access to broadband Internet access service on the bases specified in the statute,” the FCC said in its rules.

The FCC discrimination rules were challenged in six federal appeals courts by various telecom and cable industry groups, and the case was assigned randomly to the 8th Circuit. Challengers included cable lobby group NCTA, wireless lobby CTIA, and USTelecom, all of which represent ISPs throughout the US. The rules were also challenged by state-level lobby groups representing ISPs in Minnesota, Missouri, Ohio, Florida, Alabama, Mississippi, and Texas.

Other court challengers include groups representing rental housing providers and contractors that help ISPs build broadband networks. Congressional Republicans separately launched a legislative effort to nullify the rules in 2024, but it was never put to a vote.

Rule covered “unintentional discrimination”

8th Circuit judges said the FCC rule covered “unintentional discrimination,” or disparate impact in which “an entity maintains a facially neutral policy or practice or acts for a non-discriminatory reason, yet still disproportionally affects a protected group,” the court said.

Judges found that “Congress did not authorize disparate impact liability” in the Infrastructure Investment and Jobs Act, the US law that authorized the FCC to impose digital discrimination rules. The law “directs the FCC to adopt final rules ‘preventing digital discrimination of access based on income level, race, ethnicity, color, religion, or national origin,’” the appeals court said, adding that “the Supreme Court has repeatedly stated that the ‘normal definition’ of discrimination is ‘differential treatment.’”