Broadband companies sue over new Net neutrality rules

A pair of lawsuits challenge agency's new Internet traffic rules, calling them a violation of federal law.

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A pair of lawsuits are challenging the FCC's new Internet traffic rules. CNET

Less than two weeks after the Federal Communications Commission unveiled new Net neutrality rules, US broadband providers have filed lawsuits to overturn the Internet traffic regulations.

The USTelecom Association, a trade group that represents some of the nation's largest Internet service providers, filed a complaint Monday in the US Court of Appeals for the District of Columbia that claims the FCC's action is a violation of federal law and was "arbitrary, capricious and an abuse of discretion." Texas-based ISP Alamo Broadband made similar arguments against the FCC's action Monday in a federal appeals court in New Orleans. The lawsuits represent the first legal challenges to the new rules in what is expected to be a lengthy court fight.

The new rules -- approved by a 3-2 vote last month -- adopted Net neutrality regulations based on a new definition of broadband that lets the government regulate Internet infrastructure as a public utility. The rules prohibit broadband providers from blocking or slowing down traffic on wired and wireless networks. They also ban Internet service providers from offering paid priority services that could allow them to charge content companies, such as Netflix, fees to access Internet "fast lanes" to reach customers more quickly when networks are congested.

"As we have said throughout this debate, our member companies conduct their business in conformance with the open Internet principles, and support their enactment into law," USTelecom President Walter McCormick said in a statement. "We do not believe the Federal Communications Commission's move to utility-style regulation invoking Title II authority is legally sustainable."

USTelecom said it filed its five-page protective petition for review out of concern that a 10-day period to challenge the rules was triggered when the agency published the new rules on March 12. However, the FCC said the window for legal challenges is 60 days after the rules are published in the Federal Register, which is expected to occur in the coming days.

An FCC spokesperson called the petitions for review "premature and subject to dismissal."

The crux of the new rules is the FCC's reclassification of broadband as a Title II telecommunications service under the 1934 Communications Act. Applying the Title II moniker to broadband has the potential to radically change how the Internet is governed, giving the FCC unprecedented authority. The provision originally gave the agency the power to set rates and enforce the "common carrier" principle, or the idea that every customer gets equal access to the network. Now this idea will be applied to broadband networks to prevent Internet service providers from favoring one bit of data over another.

The new regulations, which came after years of grappling with how much or even whether the federal government should be involved in regulating the Internet, reinstated regulations that were thrown out by a federal court last year. Broadband providers such as Verizon and Comcast argue that applying outdated regulation to the broadband industry will stifle innovation and allow the government to impose new taxes and tariffs.

FCC Chairman Tom Wheeler said the controversial move to reclassify broadband is necessary to ensure that the rules will stand up to future court challenges. The FCC has lost two previous lawsuits in which rules for protecting an open Internet were challenged that did not include broadband reclassification.

The lawsuits are first of what are expected to be many challenges initiated by the broadband industry. Verizon successfully sued the FCC to overturn the agency's 2010 Open Internet rules - a decision that was based on a legal technicality but upheld the FCC's authority to regulate Internet openness. AT&T had hinted it would file a lawsuit once the new rules become public.

CNET's Marguerite Reardon contributed to this report.