Restart on Digital Discrimination Rules

On May 6, the U.S. Court of Appeals for the Eighth Circuit vacated the Federal Communications Commission’s digital discrimination rules. The Court completely vacated the FCC’s 2023 discrimination order, which means it is the same as if it didn’t exist. The FCC is still obligated by the Infrastructure Investment and Jobs Act to implement discrimination rules, so we can expect the FCC to restart the process. Any new FCC proposed rules will undoubtedly acknowledge the Court rulings. The natural question to ask is what the court order means in the market. There should be little immediate impact since the FCC’s 2023 discrimination rules never went into effect when they were immediately challenged in court. There will be repercussions since the Court considerably weakened the 2023 FCC order by only allowing the intentional discrimination test. It seems likely that it will be nearly impossible to prove that an internet service provider intentionally discriminated against some subset of customers. The proof would have to be some sort of written documentation or public statement that proves the ISP’s intention to discriminate. The Court eliminated the disparate discrimination test, which is basically an “if it quacks like a duck, it is a duck” test. That’s the kind of test that has routinely been applied to housing discrimination complaints, as was ordered by the Fair Housing Act. The revised rules will also let landlords off the hook since they will not be subject to broadband discrimination complaints.