Verizon files first legal challenge against FCC's net neutrality rules

It took less than a month after the FCC put forth its landmark net neutrality rules for someone to challenge it, and that challenge came last week by Verizon Communications (NYSE: VZ), which filed a suit with a federal appeals court to block the new regulations.

As one of the most vocal opponents of net neutrality, Verizon argued that the said that the FCC does not have the authority to enact the new rules.

It appears that Verizon is looking to leverage precedent by making its case in the U.S. Court of Appeals for the D.C. Circuit. Not only is it the same federal court that ruled in April that FCC did not have the right to stop Comcast from blocking its subscribers from using a bandwidth hungry file-sharing service, but Verizon has also retained the services of Helgi Walker of Wiley Rein LLP, who is the same lawyer who helped Comcast win its case.

With the new FCC's net neutrality rules in place, wireless and wireline service providers are prohibited from blocking third-party alternative services such as Skype or Vonage that compete against their own voice and video services.

Although Verizon is the first major service provider to challenge the FCC's new rules, it is likely the first of several legal challenges to net neutrality to emerge.

Verizon says that while it supports network neutrality, it believes the FCC action "goes well beyond any authority provided by Congress, and creates uncertainty for the communications industry, innovators, investors and consumers." The telco wants the FCC to overturn the rules.

"We are deeply concerned by the F.C.C.'s assertion of broad authority for sweeping new regulation of broadband networks and the Internet itself," Michael E. Glover, a senior vice president and deputy general counsel for Verizon, said in a statement.  

Public interest groups, including Public Knowledge, a digital rights advocacy think tank, quickly dismissed Verizon's suit that it was nothing more than the telco's effort to try to get its own way.

"Verizon is trying to be too cute in trying to pick not only the venue for the challenge to the rules, but also to pick the judges to hear it," Feld said in a statement. "The court should see through this ploy and reject Verizon's attempt to pick the home field for its appeal."

The FCC is only one target in Verizon's net neutrality war. As reported in sister publication FierceOnlineVideo, Verizon has established an unprecedented ally in Comcast, which previously imposed charges on wholesale service provider Level 3 on traffic it carried over its last mile network from video supplier Netflix. Both Verizon and Comcast argue that the new charges are there to compensate Comcast for increased amounts of bandwidth it will need to allocate to Level 3. However, Level 3 argues that the MSO's fees are not only a defensive move to protect its long-standing video empire by increasing the price Netflix will have to pay to deliver online video services to Comcast subscribers, but also a violation of the FCC's net neutrality rules.

For more:
- New York Times has this article
- here's FierceOnlineVideo's take
- and FierceCable's take

Related articles:
Politically split FCC passes new net neutrality rules
FCC approves light net neutrality rules for wireless
Net neutrality lobbying heats up ahead of Dec. 21 vote
Only Obama's a little bit neutral on value of net neutrality

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