Case 2:21-cv-02389-DRH-AKT Document 1 Filed 04/30/21 Page 1 of 19 PageID #: 1
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`UNITED STATES DISTRICT COURT
`EASTERN DISTRICT OF NEW YORK
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`Case No. 21-cv-2389
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`NEW YORK STATE
`TELECOMMUNICATIONS ASSOCIATION,
`INC., CTIA – THE WIRELESS
`ASSOCIATION, ACA CONNECTS –
`AMERICA’S COMMUNICATIONS
`ASSOCIATION, USTELECOM – THE
`BROADBAND ASSOCIATION, NTCA – THE
`RURAL BROADBAND ASSOCIATION, and
`SATELLITE BROADCASTING &
`COMMUNICATIONS ASSOCIATION, on
`behalf of their respective members,
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`Plaintiffs,
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` v.
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`LETITIA A. JAMES, in her official capacity as
`Attorney General of New York,
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`Defendant.
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`COMPLAINT FOR DECLARATORY JUDGMENT AND
`PRELIMINARY AND PERMANENT INJUNCTIVE RELIEF
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`Plaintiffs New York State Telecommunications Association, Inc. (“NYSTA”), CTIA –
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`The Wireless Association (“CTIA”), ACA Connects – America’s Communications Association
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`(“ACA Connects”), USTelecom – The Broadband Association (“USTelecom”), NTCA – The
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`Rural Broadband Association (“NTCA”), and Satellite Broadcasting & Communications
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`Association (“SBCA”) (collectively, the “Associations”), bring this suit on behalf of their
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`members for declaratory judgment and preliminary and permanent injunctive relief against
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`Defendant Letitia A. James, in her official capacity as Attorney General of New York, stating as
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`follows:
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`NATURE OF THE CASE
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`1.
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`“Today, access [to the Internet] is generally furnished through ‘broadband,’ i.e.,
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`high-speed communications technologies.” Verizon v. FCC, 740 F.3d 623, 629 (D.C. Cir. 2014).
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`Broadband service “transmits data at much higher speeds” than preexisting technologies, such as
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`dial-up connections provided over local telephone facilities. NCTA v. Brand X Internet Servs.,
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`545 U.S. 967, 975 (2005).
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`2.
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`Under federal law, broadband Internet access service (“broadband”) is an
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`interstate information service that is subject to a federal regulatory framework, under which a
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`combination of mandatory disclosures, competition, and federal and state enforcement of
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`preexisting laws benefit consumers. The Federal Communications Commission (“FCC”) has
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`consistently — both in 2015 when it regulated broadband as a common-carrier service and in
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`2018 when it re-established the current, non-common-carrier federal framework — rejected ex
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`ante rate regulation for broadband. Indeed, the broadband service that New York seeks to
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`regulate has never been subject to rate regulation at the federal or state level.
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`3.
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`Broadband providers recognize the need to close the “digital divide” and to ensure
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`that broadband is both available and accessible to all Americans, including low-income
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`households. In addition to continuing to build out their networks to reach underserved
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`communities, broadband providers have developed their own, lower-priced offerings specifically
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`designed for low-income households. In addition, broadband providers participate in federal
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`programs that provide subsidies to make broadband more affordable. These include both
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`established programs like Lifeline and the newly created Emergency Broadband Benefit, which
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`takes effect on May 12, 2021. More than 50 broadband providers in New York are making
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`broadband available to low-income households in New York through the Emergency Broadband
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`Benefit. New York recognizes that, as a result of providers’ offerings and these federal
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`2
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`programs, there are already “multiple options” for New Yorkers to purchase “affordable internet
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`plans.” Find Affordable Internet Options in New York State, https://forward.ny.gov/find-
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`affordable-internet-options-new-york-state (listing available options throughout the state).
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`4.
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`New York, however, now seeks to regulate broadband rates. A provision of the
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`recently enacted New York State Fiscal Year 2022 Budget requires wireline, fixed wireless, and
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`satellite broadband providers — no later than June 15, 2021 — to begin offering to qualifying
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`low-income consumers high-speed broadband service at a cost to consumers of $15 per month or
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`higher-speed broadband service at a cost to consumers of $20 per month (the “Rate Regulation”).
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`5.
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`Both an FCC order that the D.C. Circuit upheld and the federal Communications
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`Act preclude New York from regulating broadband rates. The Court should declare that New
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`York’s Rate Regulation is preempted and should permanently enjoin Defendant from enforcing
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`or giving effect to it.1
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`6.
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`First, New York’s Rate Regulation conflicts with the FCC’s 2018 decision, which
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`the D.C. Circuit upheld in relevant part, that broadband is an interstate information service that
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`should not be subject to common-carrier regulation. The Rate Regulation conflicts with that
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`decision, as well as the Communications Act, by compelling providers to offer broadband on a
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`common-carrier basis: at state-set rates and terms to all eligible members of the public.
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`7.
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`Second, New York’s Rate Regulation intrudes into an exclusively federal field.
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`More than a century ago, Congress enacted legislation that occupied the field of interstate
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`communications service and, thereby, precluded states from directly regulating those services.
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`In violation of that long-standing law, the Rate Regulation expressly seeks to set the rates and
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`1 The Associations will be filing a Motion for Preliminary Injunction based on the
`immediate, irreparable harm that the Rate Regulation threatens to impose.
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`3
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`speed of an interstate communications service. No state has ever successfully engaged in such
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`regulation.
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`8.
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`In short, New York has overstepped its regulatory authority. The Rate Regulation
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`is preempted under both conflict and field preemption principles.
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`JURISDICTION AND VENUE
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`9.
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`This Court has subject matter jurisdiction pursuant to 28 U.S.C. § 1331 because
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`the Associations’ claims arise under the laws of the United States, including the Communications
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`Act, 42 U.S.C. § 1983, and the Supremacy Clause of the United States Constitution, U.S. Const.
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`art. VI, cl. 2. This Court has equitable jurisdiction to enjoin actions by state officials that are
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`preempted by federal law. See Armstrong v. Exceptional Child Ctr., Inc., 575 U.S. 320, 326-27
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`(2015) (citing Ex parte Young, 209 U.S. 123, 150-51 (1908)).
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`10.
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`Because an actual controversy within the Court’s jurisdiction exists, this Court
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`may grant declaratory and injunctive relief pursuant to the Declaratory Judgment Act, 28 U.S.C.
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`§§ 2201-2202.
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`11.
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`Venue is proper in the Eastern District of New York under 28 U.S.C.
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`§ 1391(b)(2), because a substantial part of the events giving rise to the Associations’ claims
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`occurred in this district. Several members of the Plaintiff Associations provide services in this
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`district, residents of this district qualify for the mandated reduced costs under the Rate
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`Regulation, and Defendant operates two regional offices in this district.
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`PARTIES
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`12.
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`Plaintiff NYSTA is a non-profit association that represents New York’s
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`telecommunications industry along with the equipment and service companies that assist them.
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`NYSTA’s membership includes telecommunications providers throughout the state, ranging
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`from larger national firms to smaller in-state providers. NYSTA advocates for its members in
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`4
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`New York State government, provides numerous venues for membership interaction, and hosts
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`educational programs regarding issues of importance to its members.
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`13.
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`Plaintiff CTIA is a non-profit association that represents the wireless
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`communications industry. Members of CTIA include mobile and fixed wireless broadband
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`Internet service providers operating in New York and throughout the country, as well as
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`providers of other wireless services, device manufacturers, and other wireless industry
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`participants.
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`14.
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`Plaintiff ACA Connects is a non-profit association representing more than 600
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`small and medium-sized broadband providers around the country. ACA Connects members —
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`including the 16 members that provide service in New York — often operate in smaller markets
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`and rural areas, where they provide communications services, including video and voice, to
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`homes and businesses that are crucial to the economic prosperity of the communities they serve.
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`15.
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`Plaintiff USTelecom is a non-profit association representing service providers and
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`suppliers for the telecom industry. USTelecom members provide a full array of services,
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`including broadband, voice, data, and video over wireline and wireless networks. Its diverse
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`member base ranges from large publicly traded communications corporations to small companies
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`and cooperatives — providing advanced communications services to both urban and rural
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`markets across the country, including in New York.
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`16.
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`Plaintiff NTCA is a non-profit association representing nearly 850 independent,
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`community-based telecommunications companies that operate in rural and small-town America,
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`including 17 providers that operate in rural areas of New York. NTCA advocates on behalf of its
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`members in the legislative and regulatory arenas, and it provides training and development;
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`publications and industry events; and an array of employee benefit programs.
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`17.
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`Plaintiff SBCA is a non-profit association that represents the consumer-based
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`satellite industry. Members of SBCA include satellite Internet service providers operating in
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`New York and throughout the country, as well as providers of other wireless services,
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`independent retailers, and other industry participants.
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`18.
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`The Associations have standing to bring the claims asserted in this Complaint on
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`behalf of their members because: (a) the subject matter of this suit is germane to the
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`Associations’ purpose; (b) members of the Associations would have standing on their own to
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`bring these claims, given the substantial harms that members face if the invalid state measure at
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`issue here were to be enforced; and (c) neither the claims asserted, nor the relief requested,
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`requires the participation of the Associations’ individual members in this lawsuit.
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`19.
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`Defendant Letitia A. James is the Attorney General of New York. Pursuant to
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`Article V, Section 4 of the New York Constitution, she is the “head . . . of the department of
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`law” of New York’s state government. N.Y. Const. art. V, § 4. She is sued in her official
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`capacity only.
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`20.
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`Section 63 of New York’s Executive Law gives the Attorney General broad
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`authority to enforce New York law. See N.Y. Exec. Law § 63(1) (providing that the Attorney
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`General shall “[p]rosecute and defend all actions and proceedings in which the state is interested,
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`and have charge and control of all the legal business of the departments and bureaus of the state,
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`or of any office thereof which requires the services of attorney or counsel, in order to protect the
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`interest of the state”); id. § 63(12) (“Whenever any person shall engage in repeated fraudulent or
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`illegal acts or otherwise demonstrate persistent fraud or illegality in the carrying on, conducting
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`or transaction of business, the attorney general may apply . . . for an order enjoining the
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`continuance of such business activity or of any fraudulent or illegal acts . . . .”).
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`21.
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`The newly enacted Rate Regulation also confers explicit enforcement authority on
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`the Attorney General. See NYS Budget Bill S2506-C, Part NN, section 1 (signed Apr. 16, 2021)
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`(new § 399-zzzzz, ¶ 10) (Ex. A) (“Whenever there shall be a violation of this section, an
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`application may be made by the attorney general in the name of the people of the state of New
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`York to a court or justice having jurisdiction by a special proceeding to issue an injunction . . . to
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`enjoin and restrain the continuance of such violation.”).
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`22.
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`The Governor of New York has promised vigorous enforcement of the Rate
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`Regulation, warning broadband providers that they “operate in the State of New York by the will
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`of the people” and that if they do not comply with the Rate Regulation, “you will lose your
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`franchise in the State of New York and that’s a promise.” N.Y. Governor Andrew Cuomo
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`Transcript of April 7, 2021 Press Conference, https://www.governor.ny.gov/news/video-audio-
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`photos-rush-transcript-governor-cuomo-presents-highlights-fy-2022-budget-reimagine.
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`23.
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`New York estimates that 2.7 million households — more than 35% of households
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`in the state — will qualify for discounted broadband service under the Rate Regulation.2 One
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`category of households the Rate Regulation covers is households eligible for free or reduced-
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`priced lunch through the National School Lunch Program. The Department of Agriculture has
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`recently announced that all households with students are eligible for free and reduced-price
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`2 See Governor Cuomo Signs Legislation Establishing First-in-the-Nation Program to
`Provide Affordable Internet to Low-Income Families, https://www.governor.ny.gov/news/
`governor-cuomo-signs-legislation-establishing-first-nation-program-provide-affordable-internet;
`U.S. Census Bureau QuickFacts: New York, https://www.census.gov/quickfacts/NY (7.3
`million households in New York as of July 1, 2019).
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`lunches throughout the 2021-22 school year.3 It is unclear whether the additional households
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`temporarily eligible under this federal program will also be eligible under the Rate Regulation.
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`STATEMENT OF FACTS
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`New York Seeks To Regulate Broadband Rates and Speeds
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`24.
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`On April 16, 2021, New York Governor Andrew Cuomo signed NYS Budget Bill
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`S2506-C.
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`25.
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`Section 1 of Part NN of that Bill enacts a new section of New York’s General
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`Business Law. See Ex. A. This new section requires providers of “broadband service” — within
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`60 days (or by June 15, 2021) — to offer one of two high-speed broadband services to certain
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`low-income customers: (1) a service that provides Internet access with a download speed of at
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`least 25 Mbps at a cost of no more than $15 per month, including any recurring taxes and fees;4
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`or (2) a service that provides Internet access with a download speed of at least 200 Mbps at a
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`cost of no more than $20 per month, including any recurring taxes and fees. See id. (new
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`§ 399-zzzzz, ¶¶ 2-4).
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`26.
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`The statute defines “broadband service” as “a mass-market retail service that
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`provides the capability to transmit data to and receive data from all or substantially all internet
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`endpoints, including any capabilities that are incidental to and enable the operation of the
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`communications service provided by a wireline, fixed wireless or satellite service provider,” but
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`not including dial-up service. Id. (new § 399-zzzzz, ¶ 1). The Rate Regulation governs every
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`3 See USDA Issues Pandemic Flexibilities for Schools and Day Care Facilities through
`June 2022 to Support Safe Reopening and Healthy, Nutritious Meals, https://www.usda.gov/
`media/press-releases/2021/04/20/usda-issues-pandemic-flexibilities-schools-and-day-care-
`facilities.
`4 The New York Public Service Commission is authorized to adopt exceptions “where
`such download speed is not reasonably practicable.” Ex. A (new § 399-zzzzz, ¶ 2).
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`provider of wireline, fixed wireless, or satellite broadband service. See id. (new § 399-zzzzz,
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`¶ 2).
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`27.
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`The Rate Regulation also limits broadband providers’ ability to increase the rates
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`the statute sets. Providers who offer the service capped at a cost of $15 per month may increase
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`their rates only once every five years, while providers who offer the service capped at a cost of
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`$20 per month may increase their rates only once every two years. Any rate increases for either
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`service must occur on 30 days’ notice and are limited by the most recent change in the consumer
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`price index, up to a maximum of two percent per year of the price of the service. See id. (new
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`§ 399-zzzzz, ¶¶ 3-4).
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`28.
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`Providers must also allow low-income subscribers to purchase broadband service
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`on a standalone basis, separate from any phone or television service. See id. (new § 399-zzzzz,
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`¶ 3). And other than the cost and speed the Rate Regulation mandates, providers must offer the
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`regulated service under the same terms and conditions that apply to their regularly priced
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`broadband offerings. See id. (new § 399-zzzzz, ¶ 6).
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`29.
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`The Rate Regulation exempts a broadband provider that provides service to fewer
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`than 20,000 households, but only if the New York Public Service Commission determines that
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`compliance with the Rate Regulation would result in an unreasonable or unsustainable financial
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`impact on that provider. See id. (new § 399-zzzzz, ¶ 5). On April 26, 2021, the New York
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`Department of Public Service’s staff issued a one-page guidance document listing certain
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`information that providers must include in any requests for exemption.
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`http://documents.dps.ny.gov/public/Common/ViewDoc.aspx?DocRefId={B6EB9B7A-BC29-
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`4EC7-8B95-47F4F6CEC1F6}.
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`30.
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`Broadband providers must also make all commercially reasonable efforts to
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`advertise the availability of broadband service for low-income consumers at the cost the Rate
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`Regulation mandates. See Ex. A (new § 399-zzzzz, ¶ 7).
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`31.
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`Finally, the Attorney General has authority to enforce the Rate Regulation by
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`seeking to enjoin any violation of its terms. Courts may also impose a $1,000 civil penalty for
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`any such violation. See id. (new § 399-zzzzz, ¶ 10).
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`Federal Law Preempts New York’s Rate Regulation
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`32.
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`The federal government has taken multiple actions to protect the public interest
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`through programs to aid low-income consumers in obtaining low-cost broadband service through
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`direct subsidies.
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`33.
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`First, the federal Lifeline program has since 2016 subsidized broadband service
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`for qualifying low-income consumers. Qualifying customers can receive $9.25 per month
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`toward their purchase of broadband service. Households containing at least one person who
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`participates in the SNAP, Medicaid, SSI, federal public housing assistance, or Veterans Pension
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`benefit programs, or certain Tribal programs, qualify for Lifeline support, as do households with
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`income less than 135 percent of the federal poverty level. The FCC has created a National
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`Verifier to enable providers to quickly and accurately determine who qualifies for the program.
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`34.
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`Second, in December 2020, Congress created a $3.2 billion Emergency
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`Broadband Connectivity Fund, which the FCC administers through the Emergency Broadband
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`Benefit. On April 29, 2021, the FCC announced that the Emergency Broadband Benefit will go
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`into effect on May 12, 2021. See FCC, Wireline Competition Bureau Announces Emergency
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`Broadband Benefit Program Launch Date, DA 21-493 (Apr. 29, 2021), https://docs.fcc.gov/
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`public/attachments/DA-21-493A1.pdf. More than 50 broadband providers in New York have
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`already confirmed that they will participate in the Emergency Broadband Benefit. See FCC,
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`Emergency Broadband Benefit Providers, https://www.fcc.gov/emergency-broadband-benefit-
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`providers#New%20York. Qualifying households can receive a subsidy of up to $50 per month
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`(and up to $75 month in Tribal areas) from participating providers for their broadband service, as
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`well as a one-time $100 benefit toward a computer or tablet. Participating providers are eligible
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`to receive reimbursement for offerings that were available as of December 1, 2020. Qualifying
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`households include those that have at least one member who is eligible for Lifeline, are approved
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`to receive benefits under the free and reduced-price school lunch program, have experienced a
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`substantial loss of income since the start of the COVID-19 pandemic, or have received a federal
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`Pell Grant in 2021. And households may receive both the Emergency Broadband Benefit and the
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`Lifeline subsidy. The FCC has expanded its National Verifier so that providers can quickly and
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`accurately determine who is eligible for the Emergency Broadband Benefit.
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`35.
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`Third, the American Rescue Plan enacted in March 2021 includes a $7.17 billion
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`Emergency Connectivity Fund. The FCC has 60 days in which to promulgate regulations to
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`implement this additional fund, which is to be used by schools and libraries for the purchase of
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`computer equipment or broadband service, including for use by students or library patrons at
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`home or at other locations outside of schools and libraries.
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`36.
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`These federal programs, together with broadband providers’ specially designed
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`lower-priced offerings, further the public interest in ensuring that broadband is both available
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`and accessible to low-income households. Indeed, New York itself has recognized that — before
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`the Rate Regulation takes effect — there are already “multiple options” for New Yorkers to
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`purchase “affordable internet plans.” Find Affordable Internet Options in New York State,
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`https://forward.ny.gov/find-affordable-internet-options-new-york-state.
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`37.
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`Federal law preempts the Rate Regulation, under both conflict preemption and
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`field preemption doctrines. The Rate Regulation conflicts with the FCC’s 2018 Order5
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`concluding that common-carrier regulation of broadband is contrary to the public interest and
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`with the Communications Act’s prohibition against subjecting information services to common-
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`carrier regulation. The Rate Regulation also impermissibly regulates in a field occupied by the
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`federal government through the Communications Act.
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`38.
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`Conflict Preemption. Under the Supremacy Clause, a state law is preempted
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`where it “stands as an obstacle to the accomplishment and execution of the full purposes and
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`objectives of Congress.” Hines v. Davidowitz, 312 U.S. 52, 67 (1941). The Rate Regulation
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`stands as an obstacle to effectuating the FCC’s determination that broadband should be subject to
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`a light-touch regulatory approach, as well as Congress’s determination that information services
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`should not be subject to common-carrier regulation.
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`39.
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`First, in its 2018 Order, the FCC ended the temporary federal regulation of
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`broadband as a common-carrier service. See 47 U.S.C. § 153(51). The FCC explained that its
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`classification was driven in large measure by its policy view that rejecting common-carrier
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`regulation “is more likely to encourage broadband investment and innovation,” while common-
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`carrier regulation of broadband had “resulted . . . in considerable social cost, in terms of foregone
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`investment and innovation,” while having “no discernable incremental benefit.” 2018 Order
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`¶¶ 86-87. The FCC also specifically identified “rate regulation” as a harmful and “costly
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`regulation” that should not be applied to broadband. See id. ¶ 101.
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`5 Declaratory Ruling, Report and Order, and Order, Restoring Internet Freedom, 33 FCC
`Rcd 311 (2018) (“2018 Order”), pet. for rev. granted in part, denied in part, Mozilla Corp. v.
`FCC, 940 F.3d 1 (D.C. Cir. 2019) (per curiam).
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`40.
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`Notably, even in the 2015 Order,6 when the FCC had deemed it appropriate to
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`regulate broadband as an interstate common-carrier service, the FCC explicitly rejected ex ante
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`rate regulation for broadband, stating that “there will be no rate regulation” of broadband and
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`that the Commission “cannot envision adopting new ex ante rate regulation of broadband . . . in
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`the future.” 2015 Order ¶¶ 382, 451.
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`41.
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`The D.C. Circuit upheld the FCC’s policy-based grounds for its 2018 Order, see
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`Mozilla, 940 F.3d at 49-55, and so they form a valid predicate for conflict preemption, see, e.g.,
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`Geier v. American Honda Motor Co., 529 U.S. 861, 874-75, 878 (2000) (state law preempted
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`because it raised an obstacle to achieving the agency’s judgment as to the optimal mix of
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`regulatory measures). The Rate Regulation directly conflicts with these policy judgments.
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`42.
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`Indeed, in attempting to regulate broadband service, the Rate Regulation employs
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`the same definition that the FCC has historically used in identifying the interstate broadband
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`services subject to federal regulation. Compare Ex. A (new § 399-zzzzz, ¶ 1) (defining
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`“broadband service” as “a mass-market retail service that provides the capability to transmit data
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`to and receive data from all or substantially all internet endpoints”), with 2018 Order ¶ 21
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`(same); 2015 Order ¶ 25 (same).
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`43.
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`Because the Rate Regulation directly undermines the FCC’s policy judgments
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`regarding the appropriate regulatory approach for broadband, it stands as an obstacle to
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`effectuating the FCC’s regulatory objectives and is therefore preempted. See, e.g., Capital Cities
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`Cable, Inc. v. Crisp, 467 U.S. 691, 708 (1984) (state law preempted where it created “a result
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`[that] is wholly at odds with the regulatory goals contemplated by the FCC”).
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`6 Report and Order on Remand, Declaratory Ruling, and Order, Protecting and
`Promoting the Open Internet, 30 FCC Rcd 5601 (2015) (“2015 Order”).
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`44.
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`Second, the Rate Regulation conflicts with Congress’s determination in the
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`Communications Act that “[a] telecommunications carrier shall be treated as a common carrier
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`under this chapter only to the extent that it is engaged in providing telecommunications
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`services.” 47 U.S.C. § 153(51). The D.C. Circuit has recognized that this provision represents a
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`“statutory prohibition[] on common carrier treatment” of information services. Verizon, 740
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`F.3d at 650.
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`45.
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`As noted above, broadband is an information service. See 2018 Order ¶¶ 2, 18,
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`65. Broadband providers are therefore exempt from common-carrier regulation under federal
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`law. See Verizon, 740 F.3d at 650 (finding it “obvious that the Commission would violate the
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`Communications Act were it to regulate broadband providers as common carriers,” given the
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`Commission’s decision to “classify broadband providers . . . as providers of ‘information
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`services’”).
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`46.
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`Yet the Rate Regulation subjects broadband to a per se form of common-carrier
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`regulation: rate regulation. To begin with, the very enterprise of rate regulation is a
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`quintessential feature of common-carrier regulation that is “utterly central” to the common-
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`carrier provisions of the Communications Act governing telecommunications services. MCI
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`Telecomms. Corp. v. AT&T Co., 512 U.S. 218, 230-32 (1994).
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`47. Moreover, “the basic characteristic” of common carriage is the “requirement of
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`holding oneself out to serve the public indiscriminately,” while leaving no “room for
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`individualized bargaining.” Verizon, 740 F.3d at 651-52. The Rate Regulation has just that
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`effect, requiring broadband providers to make their services available to a statutorily defined
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`segment of the general public at a cost set by statute and on mandated terms and conditions.
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`Case 2:21-cv-02389-DRH-AKT Document 1 Filed 04/30/21 Page 15 of 19 PageID #: 15
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`48.
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`The Rate Regulation would thus treat broadband — an information service — as a
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`common-carrier service contrary to Congress’s judgment as reflected by 47 U.S.C. § 153(51).
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`See Arkansas Elec. Coop. Corp. v. Arkansas Pub. Serv. Comm’n, 461 U.S. 375, 384 (1983) (a
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`federal determination that the area is best left “unregulated” carries “as much pre-emptive force
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`as a decision to regulate”).
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`49.
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`Field Preemption. Under the Supremacy Clause, a state law is preempted where
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`“Congress has legislated so comprehensively that federal law occupies an entire field of
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`regulation and leaves no room for state law.” New York SMSA Ltd. P’ship v. Town of
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`Clarkstown, 612 F.3d 97, 104 (2d Cir. 2010) (quoting Wachovia Bank, N.A. v. Burke, 414 F.3d
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`305, 313 (2d Cir. 2005)).
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`50.
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`Congress has occupied the field of interstate communications services, which
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`includes interstate information services, for more than a century. As the Second Circuit has
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`recognized, “[t]he Supreme Court has held that the establishment of this broad scheme for the
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`regulation of interstate service” in the Communications Act and its predecessors “indicates an
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`intent on the part of Congress to occupy the field to the exclusion of state law.” Ivy Broad. Co.
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`v. AT&T Co., 391 F.2d 486, 490-91 (2d Cir. 1968) (collecting cases).
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`51.
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`The Communications Act “appl[ies] to all interstate . . . communication by wire
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`or radio,” while denying the FCC “jurisdiction with respect to . . . intrastate communication
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`service by wire or radio.” 47 U.S.C. § 152(a)-(b). Section 152 thus “divide[d] the world . . . into
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`two hemispheres — one comprised of interstate service, over which the FCC would have plenary
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`authority, and the other made up of intrastate service, over which the States would retain
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`exclusive jurisdiction.” Louisiana Pub. Serv. Comm’n v. FCC, 476 U.S. 355, 360 (1986).
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`Case 2:21-cv-02389-DRH-AKT Document 1 Filed 04/30/21 Page 16 of 19 PageID #: 16
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`52.
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`Broadband is an interstate communications service because the servers that
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`contain the content customers access and enable the services customers use via the Internet are
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`geographically dispersed across the nation and around the world. Both the FCC and federal
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`courts have repeatedly and consistently held over the course of more than two decades that
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`broadband is an interstate communications service. See, e.g., 2018 Order ¶ 199 (citing
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`precedent); USTelecom Ass’n v. FCC, 825 F.3d 674, 730-31 (D.C. Cir. 2016) (same);
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`Memorandum Opinion and Order, NARUC Petition for Clarification or Declaratory Ruling, 25
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`FCC Rcd 5051, ¶ 8 n.24 (2010) (broadband is “properly considered jurisdictionally interstate for
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`regulatory purposes”).
`
`53.
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`Because broadband service “qualifies as ‘interstate and foreign communication by
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`wire’ within the meaning of Title I of the Communications Act,” Comcast Corp. v. FCC, 600
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`F.3d 642, 646-47 (D.C. Cir. 2010) (quoting 47 U.S.C. § 152(a)), it is subject to the “centraliz[ed]
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`authority” of the FCC, 47 U.S.C. § 151, and states lack the authority to regulate it.
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`54.
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`The Rate Regulation expressly seeks to regulate an interstate communications
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`service. See Ex. A (new § 399-zzzzz, ¶ 1) (defining “broadband service” as “a mass-market
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`retail service that provides the capability to transmit data to and receive data from all or
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`substantially all internet endpoints”). Because the law purports to regulate directly an interstate
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`communications service — and to regulate core terms of that service, including its cost and
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`speed — it intrudes into the field that Congress intended the FCC to occupy and is accordingly
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`preempted. See 47 U.S.C. § 152(a)-(b); New York SMSA, 612 F.3d at 105.
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`FIRST CLAIM FOR RELIEF
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`Declaratory Judgment That Federal Law Preempts the Rate Regulation
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`55.
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`The allegations of paragraphs 1 through 54 above are incorporated as though fully
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`set forth herein.
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`16
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`Case 2:21-cv-02389-DRH-AKT Document 1 Filed 04/30/21 Page 17 of 19 PageID #: 17
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`56.
`
`The Rate Regulation is preempted because i