Lawyers Defending FCC Predict Divided SCOTUS on USF Challenge
Lawyers for the Schools, Health & Libraries Broadband Coalition and the Benton Institute for Broadband & Society were cautiously optimistic Wednesday that their side would prevail at the U.S. Supreme Court in support of the FCC and the USF contribution factor in FCC v. Consumers’ Research. But they also expect a divided decision. SCOTUS is to consider the case March 26.
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SCOTUS decided in November to hear a challenge to the 5th U.S. Circuit Court of Appeals' 9-7 en banc decision, which found that the USF contribution factor is a "misbegotten tax,” which many observers say could overturn a program critical to consumers and widen the digital divide (see 2412100060). A key question before the court is the future of the long-standing nondelegation doctrine.
HWG’s Jason Neal, who represents SHLB, said his side was pleased that President Donald Trump's administration “very strongly” defended the FCC and the USF contribution factor in a recent reply brief (see 2503140053). “When administrations change, sometimes the government takes a different view of the law,” he said.
There were a few “different views” on the “nuances” of the legal issues raised in the brief, compared to former President Joe Biden's administration, Neal said. The government “used that in their favor basically to say we have a more conservative view of these issues than the Biden administration did, and we think this [is] constitutional,” he said.
Neal said that in its lengthy brief challenging the USF contribution factor, Consumers’ Research dedicated “about two pages” to arguments that the FCC’s reliance on the Universal Service Administrative Co. is an unconstitutional “double-layered delegation" in keeping with the en banc decision. That theory isn’t “something that they argued for in the 5th Circuit,” he said. “They spent all of their brief basically saying … you should change the law on the nondelegation doctrine.” The court is very likely to ask about the double-delegation issue, he said.
“I don’t think the 5th Circuit’s rationale” on double delegation “makes a whole lot of sense,” Neal said. “I don’t think the Supreme Court is likely interested in creating kind of a wide-open new doctrine like that -- you never know.”
An appellate oral argument is “frequently described as a conversation between the lawyer and the judges,” said Andrew Schwartzman, the Benton Institute's senior counselor. SCOTUS “is a little bit different,” because there are nine justices, and “they get the final word -- they’re not dealing with precedent in the same way." There’s a conversation between the lawyer and the justices and also among the justices, “which is done by asking questions that are frequently very pointed and directed at something one of the other justices has said” in the specific oral argument or in another case, Schwartzman said.
Previously, oral argument lasted “60 minutes exactly,” Schwartzman said. Indeed, former Chief Justice William Rehnquist would halt discussion while a question was being answered. New procedures started during the COVID-19 pandemic give lawyers two minutes of uninterrupted time to state their position, and there's a structured section where justices ask questions in order of seniority. That means the session can last longer than in the past, he added.
Schwartzman noted that the telecom industry hired Paul Clement of Clement & Murphy to make its argument before the court. Clement is “very conservative” and considered “the leading Supreme Court advocate of our day,” he said. “We’re much better off having him on our side.”
Conservative Justice Neil Gorsuch “wants to revisit” the nondelegation doctrine, Schwartzman said. “The argument here is that this is the wrong case to do that, but he’s probably pretty firm in that view,” and “he has some support."
Schwartzman predicted that the focus of court watchers would be on the judges now considered in the middle of the conservative court -- Chief Justice John Roberts and Justices Brett Kavanaugh and Amy Coney Barrett. He also noted that SCOTUS hasn’t overruled an agency action based on nondelegation since 1935. Both lawyers said SCOTUS is often difficult to read based on questions during oral argument.
Neal said he didn’t want to speculate on why Consumers’ Research decided to focus on Section 254 of the Communications Act and the contribution factor. The group has “a conservative legal viewpoint -- they view themselves as having a mission to challenge government overreach,” and USF is “a large and important federal program.”
Consumers’ Research is almost 100 years old but in recent years “has become a vehicle for a series of conservative legal challenges,” Schwartzman said, noting that little is known about who's providing it with financial support. The group is “very well-funded” and hires “very talented and expensive legal counsel,” he said.