SCOTUS May Seek 'Off Ramp' in Key USF Case

But some see the court’s seeking a briefing on a mootness item surrounding a legal challenge to the constitutionality of the USF (see 2411220050) as possibly meaning the justices see an off-ramp where they can overturn the 5th Circuit without addressing USF's constitutionality. Some observers think SCOTUS is unlikely to do anything that would blow up USF, which has broad bipartisan support (see 2411250031).

“We have a strong case, including wins in three conservative appeals court panels, and we expect to win this case,” said Andrew Schwartzman, senior counselor at the Benton Institute for Broadband & Society.

Deciding the case is moot due to challenger Consumers' Research not seeking preliminary relief from the 5th Circuit, such as a temporary injunction, would let SCOTUS deal with a major, disruptive case without taking a position on USF issues, said Gillian Metzger, Columbia Law administrative and constitutional law professor. The high court "kind of had to take the case," owing to the split among federal circuit courts and that USF is a major federal program, she added.

Gundy

Steve Vladeck, professor at Georgetown University Law School, noted that in 2019, when the court handed down Gundy v. U.S., a criminal case without implications for communications law, it appeared ready to take on the nondelegation doctrine. Subsequently, SCOTUS has turned down numerous cases that would provide an opening, he said.

“Only folks inside the Court know for sure, but it’s entirely possible that the [perceived] need to reinvigorate the non-delegation doctrine has been abated somewhat by intervening developments—especially the demise of Chevron deference and the rise of the so-called “major questions” doctrine,” Vladeck wrote: “As a practical matter, a world without Chevron and with the ‘major questions’ doctrine is a world in which Congress can delegate significant power to agencies only expressly.”

Chief Justice John Roberts joined the dissent in Gundy, “in favor of reviving nondelegation,” emailed TechFreedom Internet Policy Counsel Corbin Barthold. Justice Brett Kavanaugh once said in a solo opinion that the Gundy dissent "raised important points that may warrant further consideration in future cases.” Moreover, Justice Amy Coney Barrett in a 2014 law review article called the nondelegation doctrine "notoriously lax," Barthold noted. “I think they're all in play.”

Justices will “probably move the needle … but in a narrow ruling, if ‘narrow’ means ‘[do] not expand nondelegation in a way that potentially blows up the government,’” Barthold said: “They could say this case is special because the USF is a tax. They could home in on the distinct private delegation problem. They could maybe expand the scope of the test but find that the USF satisfies the new standard.”

David Froomkin, University of Houston assistant law professor, emailed that it appears unlikely SCOTUS will uphold the 5th Circuit decision. While the court is very interested in constraining legislative delegation to the administrative state, it "has already largely accomplished its goals" through creation of the major questions doctrine, he said. "It is hard to see why the Court would want to invite the criticism it would receive for creating sweeping new constitutional law when it has already largely accomplished its goals through less obtrusive means," he said.

Toughening the nondelegation doctrine via the USF case "would be a radical change in the law and one that flies in the face of precedent," Froomkin added. Federal courts have rarely struck down statutes under the nondelegation doctrine -- generally it arises in cases when Congress provided the executive with vast power, though without standards guiding it, he said. Those cases concerned delegations to the president, not administrative agencies, and the power in the presidency "poses much more serious concerns about legislative divestment." Certifying the mootness issue for review suggests SCOTUS "want[s] to leave the door open to doing so."

The Consumers’ Research nondelegation challenge “is stronger than most others because it involves what the 5th Circuit majority characterized as an assessment of a tax, implicating Congress’s taxing power,” Free State Foundation President Randolph May wrote in an email. “And it involves the FCC’s subdelegation of some of its decision-making functions to a private organization,” he added: “Together these are ‘red flags’ when it comes to assessing the lawfulness of this particular nondelegation challenge, increasing the chances the Court will affirm the 5th Circuit decision, assuming it reaches the merits.”

Even if Consumers’ Research prevails, SCOTUS’ decision will likely make clear that each case “will stand or fall on its own individual facts,” May said: “That means the outcome of each nondelegation challenge will depend on a close reading of the statute to determine whether ... it contains a requisite 'intelligible principle’ to direct the agency’s action.”

Resolving the case on procedural grounds, such as mootness, may let SCOTUS avoid potentially conflicting findings, including reconciling the 5th Circuit's view of USF as a tax with the 7th Circuit's conclusion that USF contributions are a fee, Jonathan Marashlian of Marashlian & Donahue blogged. A mootness finding would let the court avoid addressing the broader implications of the case and defer those matters to a future case with a more robust procedural history, he said. Avoiding a ruling on the constitutionality of USF also could signal to Congress the need to find a long-term solution to funding and administering the USF, he added.

Mootness Questions

“The mootness question was not among the issues the petitioners raised, even in passing,” said Cooley’s Robert McDowell: “By adding this issue to the review, the court thinks the mootness issue should be addressed. It's always significant when the court raises an issue on its own, and doing so could mean the court is poised to return the case based on mootness."

Deciding the case on merits, rather than mootness, means addressing whether USF violates the nondelegation doctrine, Womble Bond's Carri Bennet, Michael Bennet, Richard Cameron and Michael Miller blogged this week. Given recent SCOTUS decisions reigning in administrative power, such as Loper Bright v. Raimondo's overturning of the Chevron doctrine and its West Virginia v. EPA ruling creating the major questions doctrine, the court "may not feel particularly eager to keep up the pressure on the administrative state."

In addition, the Womble Bond lawyers said that while a Biden administration solicitor general might file the opening brief, due Jan. 6, the government's reply brief would come from a Trump administration solicitor general. It's possible the next administration and FCC might choose to stop defending universal service support mechanisms, the lawyers said. The government also might argue the case is moot, letting SCOTUS save the nondelegation question for the future. And it's "entirely plausible" the government would stay the course on its current arguments that the case isn't moot and that the court should decide the nondelegation question in the government's favor.