Amer Cncl Educ v. FCC

United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued May 5, 2006 Decided June 9, 2006

No. 05-1404

AMERICAN COUNCIL ON EDUCATION,
PETITIONER

v.

FEDERAL COMMUNICATIONS COMMISSION AND
UNITED STATES OF AMERICA,
RESPONDENTS

VERIZON TELEPHONE COMPANIES AND
CELLCO PARTNERSHIP, D/B/A VERIZON WIRELESS,
D/B/A VERIZON WIRELESS,
INTERVENORS

Consolidated with
05-1408, 05-1438, 05-1451, 05-1453

On Petitions for Review of an Order of the
Federal Communications Commission

Matthew A. Brill argued the cause for petitioners. With
him on the briefs were Maureen E. Mahoney, Richard P. Bress,
Barry J. Blonien, James Xavier Dempsey, John B. Morris, Jr.,
Albert Gidari, Gerard J. Waldron, Andrew J. Schwartzman,
 2

Harold J. Feld, Jason Oxman, and Marc Rotenberg. John M.
Devaney entered an appearance.

Jacob M. Lewis, Attorney, Federal Communications
Commission, argued the cause for respondent. With him on the
brief were Samuel L. Feder, General Counsel, John E. Ingle,
Deputy Associate General Counsel, and Joseph R. Palmore,
Counsel.

Peter D. Keisler, Assistant Attorney General, U.S.
Department of Justice, Douglas N. Letter, Litigation Counsel,
and Scott R. McIntosh, Attorney, were on the brief for
respondent United States.

Michael E. Glover, Karen Zacharia, Joshua E. Swift,
John Scott, Samir C. Jain, and Meredith B. Halama were on the
brief for intervenors Verizon and Verizon Wireless in support of
respondents.

Before: SENTELLE and BROWN, Circuit Judges, and
EDWARDS, Senior Circuit Judge.

Opinion for the Court filed by Circuit Judge SENTELLE.

Dissenting opinion by Senior Circuit Judge EDWARDS.

SENTELLE, Circuit Judge: In 2004, several law-
enforcement agencies petitioned the Federal Communications
Commission (“FCC” or “the Commission”) to clarify the scope
of the Communications Assistance for Law Enforcement Act, 47
U.S.C. §§ 1001-1010 (“CALEA” or “the Act”), with respect to
certain broadband Internet services. In response, the
Commission ruled that providers of broadband Internet access
and voice over Internet protocol (“VoIP”) services are regulable
as “telecommunications carriers” under the Act. As
 3

“telecommunications carriers,” broadband and VoIP providers
must ensure that law-enforcement officers are able to intercept
communications transmitted over the providers’ networks. The
American Council on Education and various other interested
parties (collectively “ACE”) petition for review, arguing that the
Commission’s interpretation of CALEA was unlawful. Because
we disagree, we deny the petition.

I

Before the dawn of the digital era, there were few
technological obstacles to the government’s wiretapping
capabilities: Eavesdropping on a phone call was as easy as
finding the copper wires that ran into every caller’s home. With
the advent of the digital age, however, the architecture of the
world’s communications networks changed drastically. In the
place of physical copper wires that connected individual end-
users, new communications technologies (such as digital
subscriber line (“DSL”), cable modems, and VoIP)1 substituted
ethereal and encrypted digital signals that were much harder to
intercept and decode using old-fashioned call-interception
techniques.

Responding to these changing technologies, in 1994
Congress passed CALEA, which requires “telecommunications
carriers” to “ensure” that their networks are technologically
“capable” of being accessed by authorized law enforcement

1
Throughout this opinion we refer collectively to DSL and
cable modems as “broadband Internet access services,” or simply
“broadband.” We refer to interconnected VoIP services—which allow
users to make phone calls over broadband connections—simply as
“VoIP.” See generally In re IP-Enabled Services, 19 F.C.C.R. 4863
(2004) (providing background information on both broadband and
VoIP).
 4

officials.2 47 U.S.C. § 1002(a). While CALEA’s substantive
provisions apply to “telecommunications carrier[s],” they do not
apply to “information services.” See id. § 1002(a), (b).
Determining which communications services fall where is the
crux of this case.

A

CALEA applies only to “telecommunications carriers.”
See id. § 1002(a). The Act defines a “telecommunications
carrier” as an “entity engaged in the transmission or switching
of wire or electronic communications as a common carrier for
hire.” Id. § 1001(8)(A). However, in addition to providers of
“transmission or switching,” CALEA’s definition of a
“telecommunications carrier” also includes:
[1] a person or entity engaged in providing wire or
electronic communication switching or transmission
service to the extent that [2] the Commission finds that
such service is a replacement for a substantial portion of
the local telephone exchange service and that [3] it is in
the public interest to deem such a person or entity to be
a telecommunications carrier for purposes of this
subchapter . . . .

Id. § 1001(8)(B)(ii) (emphasis added). Section
1001(8)(B)(ii)—which is commonly referenced as CALEA’s
“Substantial Replacement Provision” or “SRP”—allows the

2
CALEA does not affect the scope of the government’s
wiretapping powers. Those powers instead come from the Omnibus
Crime Control and Safe Streets Act, Pub. L. No. 90-351, 82 Stat. 197
(1968) (codified as amended in scattered sections of 5, 18, and 42
U.S.C.), and the Foreign Intelligence Surveillance Act, Pub. L. No.
95-511, 92 Stat. 1783 (1978), 50 U.S.C. §§ 1801-1871.
 5

Commission to expand the definition of a “telecommunications
carrier” to include new technologies that substantially replace
the functions of an old-fashioned telephone network.

CALEA does not apply to “persons or entities insofar as
they are engaged in providing information services.” Id. §
1001(8)(C)(i) (the “information-services exclusion”). The Act
defines an “information service” as “the offering of a capability
for generating, acquiring, storing, transforming, processing,
retrieving, utilizing, or making available information via
telecommunications.” Id. § 1001(6)(A). Because information-
service providers are not subject to CALEA, they need not make
their networks accessible to law-enforcement agencies. See id.
§ 1002(b)(2)(A).

B

In 2004, the United States Department of Justice, the
Federal Bureau of Investigation, and the United States Drug
Enforcement Administration (collectively, “the DOJ”) filed a
joint petition for expedited rulemaking before the FCC. The
DOJ explained that “[t]he ability of federal, state, and local law
enforcement to carry out critical electronic surveillance is being
compromised today by providers who have failed to implement
CALEA-compliant intercept capabilities.” In response, the
Commission issued a notice of proposed rulemaking and invited
comments on whether certain communications
providers—including broadband and VoIP providers—must
comply with CALEA. See Communications Assistance for Law
Enforcement Act and Broadband Access and Services, Notice of
Proposed Rulemaking and Declaratory Ruling, 19 F.C.C.R.
15676, 15677 (2004).

After receiving thousands of pages of comments from
more than 40 interested parties, the Commission ruled that
 6

broadband and VoIP providers are covered (at least in part) by
CALEA’s definition of “telecommunications carriers.” See
Communications Assistance for Law Enforcement and
Broadband Access and Services, 20 F.C.C.R. 14989, ¶ 8 (2005)
(“Order”). To avoid an “irreconcilable tension” between
CALEA’s SRP and the information-services exclusion, the
Commission concluded that the Act creates three categories of
communications services: pure telecommunications (which
plainly fall within CALEA), pure information (which plainly fall
outside CALEA), and hybrid telecommunications-information
services (which are only partially governed by CALEA). Id. ¶
18.

The FCC then concluded that broadband and VoIP are
hybrid services that contain both “telecommunications” and
“information” components.3 Id. at ¶¶ 24-45. The Commission
explained that CALEA applies to providers of those hybrid
services only to the extent they qualify as “telecommunications
carriers” under the three prongs of the SRP. First, providers of
both technologies must perform switching and transport
functions. See id. ¶ 26; id. ¶ 41. Second, providers of both
technologies serve as replacements for a substantial
functionality of local telephone exchange service: Broadband
replaces the transmission function previously used to reach dial-
up Internet service providers (“ISPs”), and VoIP replaces
traditional telephone service’s voice capabilities. See id. ¶¶ 27-
31; id. ¶ 42. Third, the public interest requires application of
CALEA to the “telecommunications” component of both
technologies: The even-handed application of CALEA across

3
Our dissenting colleague asserts that “[b]roadband Internet
is an ‘information service’—indeed, the Commission does not dispute
this.” Dissent at 2. However, in the Order the Commission
determines that broadband Internet is not an “information service” for
purposes of CALEA. See Order, 20 F.C.C.R. 14989, ¶¶ 37-38.
 7

technologies will not impede competition or innovation (id. ¶¶
33-34; id. ¶ 43), and “[t]he overwhelming importance of
CALEA’s assistance capability requirements to law enforcement
efforts to safeguard homeland security and combat crime weighs
heavily in favor” of applying CALEA broadly. Id. ¶ 35; see also
id. ¶ 44.

Notwithstanding CALEA’s breadth, the Commission
clarified that the Act does not apply to “private networks.” See
id. ¶ 36 n.100 (citing 47 U.S.C. § 1002(b)(2)(B)). The FCC
noted that some broadband companies “provide access to private
education, library and research networks.” Id. The Commission
explained that these companies may or may not qualify for
CALEA’s private-networks exclusion:

To the extent [the petitioners] are engaged in the
provision of facilities-based private broadband networks
or intranets that enable members to communicate with
one another and/or retrieve information from shared data
libraries not available to the general public, these
networks appear to be private networks for purposes of
CALEA. . . . We therefore make clear that providers of
these networks are not included as “telecommunications
carriers” under the SRP with respect to these networks.
To the extent, however, that these private networks are
interconnected with a public network, either the [public
voice network] or the Internet, providers of the facilities
that support the connection of the private network to a
public network are subject to CALEA under the SRP.

Id. Thus, private networks—like broadband and VoIP—are
excluded from CALEA insofar as they meet one of the statute’s
exclusions. See 47 U.S.C. § 1002(b)(2)(A) (excluding
“information services”), (B) (excluding “private networks”).
However, to the extent a service provider qualifies as a
 8

“telecommunications carrier,” it is subject to CALEA’s
substantive requirements. See id. § 1001(8).

The Commission recognized that it had separately
adopted a different interpretation of a similar term
(“telecommunications service”) under a different statute.
Interpreting the Telecommunications Act of 1996, Pub. L. No.
104-104, 110 Stat. 56, 47 U.S.C. §§ 251-276 (“the Telecom
Act” or “the 1996 Act”), the FCC previously concluded that
broadband Internet service is not a “telecommunications
service,” and it therefore falls outside the ambit of the 1996 Act.
See In re Inquiry Concerning High-Speed Access to the Internet
over Cable and Other Facilities, 17 F.C.C.R. 4798, 4823 (2002)
(“Broadband Declaratory Ruling”). To reconcile the Order
(promulgated under CALEA) with the Broadband Declaratory
Ruling (promulgated under the 1996 Act), the Commission
emphasized that both CALEA and the Telecom Act are silent
regarding how (or whether) the FCC should regulate mixed
services that have both “telecommunications” and “information”
components. Order, 20 F.C.C.R. 14989 ¶ 17. Thus, the FCC
concluded that both statutes vest it with discretion to interpret
Congress’s ambiguous treatment of hybrid telecommunications-
information services.

In the context of the 1996 Act, the Commission
concluded that hybrid services fall entirely outside the statute’s
scope. Because the 1996 Act defines both “telecommunications
service” and “information service” in terms of an “offering” to
consumers, see Broadband Declaratory Ruling, 17 F.C.C.R. at
4820, ¶ 34, and because consumers perceive broadband Internet
access to be a single “offer” for an integrated “information
service,” id. at 4821-24, ¶¶ 35-41, the FCC concluded that cable-
modem service is exclusively an “information service,” which
is unregulable under the 1996 Act, id. at 4832, ¶ 59. The
Commission further emphasized that its interpretation of the
 9

Telecom Act is consistent with Congress’s deregulatory goals.
See id. at 4802, ¶ 5; id. at 4823-24, ¶¶ 40-41; see also Verizon
Commc’ns Inc. v. FCC, 535 U.S. 467, 502 n.20 (2002)
(emphasizing “the deregulatory and competitive purposes of the
[1996] Act”); Cellco P’ship v. FCC, 357 F.3d 88, 96-103 (D.C.
Cir. 2004) (emphasizing the 1996 Act’s “deregulatory
purpose”). The Supreme Court upheld the FCC’s Broadband
Declaratory Ruling as a “reasonable” interpretation of the 1996
Act. See Nat’l Cable & Telecomms. Ass’n v. Brand X Internet
Servs., 125 S. Ct. 2688, 2708 (2005) (citing Chevron U.S.A., Inc.
v. Natural Res. Def. Council, Inc., 467 U.S. 837, 845 (1984));
see also id. at 2711 (upholding the Commission’s conclusion
that the purpose of the 1996 Act is to foster “a minimal
regulatory environment that promotes investment and innovation
in a competitive market” (internal quotation marks and citation
omitted)).

However, the Telecom Act differs significantly from
CALEA. Unlike CALEA, the 1996 Act does not contain an
analogue to CALEA’s SRP: While an entity is covered by
CALEA if it provides transmission, switching, or the functional
equivalent thereof, an entity is covered by the Telecom Act only
if it provides “transmission.” See 47 U.S.C. § 153(43). Also
unlike CALEA, the Telecom Act does not contain an analogue
to CALEA’s “insofar as” clause: While an entity is excluded
from CALEA only “insofar as” it provides “information
services,” the 1996 Act categorically excludes “information
services” en toto. See id. § 153(44). Finally, unlike CALEA,
the Telecom Act refers to two “service offerings”: While
CALEA refers only to an “offering” of “information services,”
the Telecom Act refers to “offerings” of both
“telecommunications services” and “information services.” Id.
§ 153(20), (46); see also Broadband Declaratory Ruling, 17
F.C.C.R. at 4823, ¶ 40 (emphasizing the fact that the 1996
Act—unlike CALEA—contains separate definitions for
 10

“telecommunications” and “telecommunications service”).

Drawing on the statutes’ different texts, structures,
legislative histories, and purposes, the FCC decided to resolve
the ambiguities in CALEA and the 1996 Act differently. In light
of “Congress’s deliberate extension of CALEA’s [substantive]
requirements to providers satisfying the SRP,” the FCC
concluded that a telecommunications carrier should not escape
the Act’s reach altogether simply because the carrier’s service
offering has an “informational” component. Order, 20 F.C.C.R.
14989, ¶ 18. Thus, the FCC concluded that CALEA’s
definitional sections are not mutually exclusive: “[W]hen a
single service comprises an information service component and
a telecommunications component, Congress intended CALEA
to apply to the telecommunications component.” Id. at ¶ 21.
The Commission further emphasized that its interpretation of
CALEA is consistent with the Act’s law-enforcement goals. Id.;
cf. Verizon, 535 U.S. at 502 n.20.

II

ACE raises three arguments in its petition for review.
First, ACE argues that broadband Internet access is an integrated
“information service” under CALEA, and as such, it is
uniformly excluded from the Act’s substantive requirements.
Second, ACE argues that VoIP similarly qualifies for CALEA’s
information-services exclusion. Third, ACE argues that the
Commission unlawfully applied the Act to “private networks.”

Our review is governed by the classic two-step approach
set out in Chevron U.S.A., Inc. v. Natural Res. Def. Council,
Inc., 467 U.S. 837 (1984). See U. S. Telecom Ass’n v. FCC, 227
F.3d 450, 457 (D.C. Cir. 2000). Under Chevron, “[i]f the intent
of Congress is clear, that is the end of the matter; for the court,
as well as the agency, must give effect to the unambiguously
 11

expressed intent of Congress.” Chevron, 467 U.S. at 842-43.
However, if the statute is “silent or ambiguous with respect to
the specific question at issue,” we ask whether the agency’s
interpretation is “permissible,” that is, “reasonable.” Id. at 843-
44; see also Northpoint Tech., Ltd. v. FCC, 412 F.3d 145, 151
(D.C. Cir. 2005) (“A ‘reasonable’ explanation of how an
agency’s interpretation serves the statute’s objectives is the stuff
of which a ‘permissible’ construction is made; an explanation
that is ‘arbitrary, capricious, or manifestly contrary to the
statute,’ however, is not.” (citations omitted)).

A

ACE first argues that broadband Internet access is an
“information service,” which falls completely beyond CALEA’s
reach. The Supreme Court has upheld the FCC’s classification
of broadband as an integrated “information service” under the
Telecom Act. See Brand X, 125 S. Ct. at 2696. CALEA’s
definition of “information service” is virtually identical to the
one included in the 1996 Act. Compare 47 U.S.C. § 1001(6)
(CALEA), with id. § 153(20) (Telecom Act). Therefore, ACE
concludes broadband providers must fall within the ambit of
CALEA’s identical “information services” exclusion.
Notwithstanding the superficial attractiveness of ACE’s
argument, we disagree.

ACE’s syllogism falls apart because CALEA and the
Telecom Act are different statutes, and Brand X was a different
case. Although ACE would have us read Brand X as controlling
this controversy, that case did not hold that broadband Internet
access is exclusively an “information service,” devoid of any
“telecommunications” component. Rather, it upheld the FCC’s
reasonable interpretation to that effect under a different statute.
See 125 S. Ct. at 2708 (citing Chevron, 467 U.S. at 845 (step
two)). Emphasizing that the Telecom Act “is ambiguous about
 12

whether cable companies ‘offer’ telecommunications with cable
modem service,” id. at 2706, the Court concluded “that the
Commission’s construction was a reasonable policy choice for
the Commission to make at Chevron’s second step,” id. at 2708
(internal quotation marks, citation, and alteration omitted).

So here. CALEA expressly provides that the
Commission may extend the definition of a
“telecommunications carrier . . . to the extent that the
Commission finds that [a] service is a replacement for a
substantial portion of the local telephone service and that it is in
the public interest to deem such a person or entity to be a
telecommunications carrier . . . .” 47 U.S.C. § 1001(8)(B)(ii)
(emphasis added). Where, as here, “Congress has explicitly left
a gap for the agency to fill, there is an express delegation of
authority to the agency to elucidate a specific provision of the
statute by regulation. Such legislative regulations are given
controlling weight,” so long as they reflect “reasonable policy
choice[s].” Chevron, 467 U.S. at 843-45; see also United States
v. Mead Corp., 533 U.S. 218, 229 (2001).

The Commission’s interpretation of CALEA represents
a “reasonable policy choice.” CALEA—unlike the 1996
Act—is a law-enforcement statute. See 47 U.S.C. § 1002(a)
(requiring telecommunications carriers to enable “the
government” to conduct electronic surveillance); id. § 1001(5)
(defining “government” as any public entity “authorized by law
to conduct electronic surveillance”). The Communications Act
(of which the Telecom Act is part), by contrast, was enacted
“[f]or the purpose of regulating interstate and foreign commerce
in communication by wire and radio . . . .” Id. § 151; see also
Verizon, 535 U.S. at 502 n.20 (emphasizing “the deregulatory
and competitive purposes of the [1996] Act”). The statutes’
respective texts reflect their disparate objectives: While the
1996 Act is framed in terms of “offerings” made by “service”-
 13

providers to consumers, CALEA’s SRP empowers the FCC to
expand its definition of a “telecommunication carrier” to meet
the evolving needs of law enforcement officials. The
Commission’s interpretation of CALEA reasonably differs from
its interpretation of the 1996 Act, given the differences between
the two statutes.4

Specifically, CALEA differs from the 1996 Act in two
important ways. First, CALEA’s definition of
“telecommunications carrier” is broader than the definition used
in the 1996 Act. To highlight the difference, we present the
statutory texts synoptically.

4
ACE attempts to obscure the differences between CALEA
and the 1996 Act by arguing that “when Congress uses the same
language in two statutes having similar purposes, particularly when
one is enacted shortly after the other, it is appropriate to presume that
Congress intended that text to have the same meaning in both
statutes.” Pet. Br. at 26 (quoting Smith v. City of Jackson, 125 S. Ct.
1536, 1541 (2005) (internal quotation marks omitted)). Of course,
ACE is correct—but only when Congress “uses the same language in
two statutes having similar purposes.” As illustrated herein,
CALEA’s language and purpose differ markedly from the 1996 Act.
 14

CALEA TELECOM ACT OF 1996
The term “telecommunications T h e t e r m
carrier” (A) means a person or “telecommunications carrier”
entity engaged in the means any provider of
transmission or switching of telecommunications services
wire or electronic [i.e., the offering of
communications as a common transmission for a fee directly
carrier for hire; and (B) to the public, or to such
includes . . . (ii) a person or classes of users as to be
entity engaged in providing effectively available directly
wire or electronic to the public, regardless of
communication switching or the facilities used] . . . .
transmission service to the
extent that the Commission
finds that such service is a
replacement for a substantial
portion of the local telephone
exchange service and that it is
in the public interest to deem
such a person or entity to be a
telecommunications carrier for
purposes of this subchapter;
but (C) does not include (i)
persons or entities insofar as
they are engaged in providing
information services . . . .

47 U.S.C. § 1001(8) 47 U.S.C. § 153(43), (44), (46)

While the Telecom Act limits its definition of
“telecommunications services” to “transmission,” CALEA’s text
is more inclusive: CALEA defines a “telecommunications
carrier” as a provider of “transmission or switching” plus any
provider that substantially replaces traditional transmission or
 15

switching. See id. § 1001(8)(B)(ii) (SRP).5

The second major difference between the two statutes is
that CALEA’s text and structure suggest that its definitions for
“telecommunications carrier” and “information services” are not
mutually exclusive terms. Unlike the 1996 Act, CALEA does
not refer to a “telecommunications service,” nor does its
definition of “telecommunications carrier” include a reference
to a service “offering.” Moreover, CALEA’s definition of a
“telecommunications carrier”—unlike the 1996 Act’s definition
of that term—excludes entities only “insofar as they are
engaged in providing information services.” Id. § 1001(8)(C)(i)
(emphasis added). These distinctions suggest that CALEA does
not define two mutually exclusive “services” that are
independently “offered” to consumers. That is, under CALEA,
a carrier might “offer” one “service” that contains both
“telecommunications” and “information” components.

ACE’s argument to the contrary relies on the fact that
“information services,” by statutory definition, are delivered
“via telecommunications” under both CALEA and the Telecom
Act. See CALEA § 1001(6)(A) (defining “information services”
as “the offering of a capability for generating, acquiring, storing,
transforming, processing, retrieving, utilizing, or making
available information via telecommunications”); Telecom Act
§ 153(20) (same). In ACE’s view, the “via

5
ACE attempts to cabin the expansive effect of the SRP by
arguing that it applies only “to commercial providers of
‘telecommunications’ that are not common carriers for hire.” Pet. Br.
at 38 (emphasis added and removed). However, ACE’s interpretation
of the SRP would eviscerate the clause that immediately precedes it,
which defines a telecommunications carrier as “a common carrier for
hire.” 47 U.S.C. § 1001(8)(A). Whatever the SRP’s meaning, ACE’s
internally contradictory interpretation is not it.
 16

telecommunications” clause makes the telecommunications and
information components of an informational service offering
inseparable under both statutes. That is, once the
“telecommunications” dimension of an “information service” is
removed, the definition of the latter term becomes a nullity. As
a result, ACE argues, we should interpret CALEA to create two
mutually exclusive categories of “telecommunications” and
“information” services, which can never overlap.

ACE’s analysis is inconsistent with our standard of
review. We cannot set aside the Commission’s reasonable
interpretation of the Act in favor of an alternatively plausible (or
an even better) one. See, e.g., Brand X, 125 S. Ct. at 2699 (“If
a statute is ambiguous, and if the implementing agency’s
construction is reasonable, Chevron requires a federal court to
accept the agency’s construction of the statute, even if the
agency’s reading differs from what the court believes is the best
statutory interpretation.”); Citizens Coal Council v. Norton, 330
F.3d 478, 482 (D.C. Cir. 2003) (“Even assuming the correctness
of [an alternative interpretation], the ambiguity of the statute in
combination with the Chevron doctrine eclipses the ability of the
courts to substitute their preferred interpretation for an agency’s
reasonable interpretation when that agency is the entity
authorized to administer the statute in question.”); Nat’l Mining
Ass’n v. Babbitt, 172 F.3d 906, 916 (D.C. Cir. 1999) (“If we
were interpreting the statute de novo, we might well agree that
appellant has the better argument. But we are not. And
although the government’s reading is a bit of a stretch, we think
it passes the Chevron test.”). The FCC offered a reasonable
interpretation of CALEA, and Chevron’s second step requires
nothing more.

We hasten to emphasize the continued vitality of
CALEA’s information-services exclusion. As the Commission
explained:
 17

A facilities-based broadband Internet access service
provider continues to have no CALEA obligations with
respect to, for example, the storage functions of its
e-mail service, its web-hosting and [“Domain Name
System,” or “DNS”] lookup functions or any other
[“Internet Service Provider,” or “ISP”] functionality of
its Internet access service. It is only the “switching and
transmission” component of its service that is subject to
CALEA under our finding today.

Order, 20 F.C.C.R. 14989, ¶ 38 (emphasis in original and
footnote omitted). Because CALEA’s definitions for
“telecommunications” and “information service” are not
mutually exclusive, the Commission reasonably concluded that
mixed services—such as broadband Internet access—are
partially covered by (and partially excluded from) the statute:
The “switching and transmission” portion of a broadband
service offering—which replaces the “switching or
transmission” portion of a dial-up Internet connection—is
covered, while any “capability for generating, acquiring, storing,
transforming, processing, retrieving, utilizing, or making
available information via telecommunications,” 47 U.S.C. §
1001(6)(A), is not.

The Commission has long distinguished between
“information services” and the underlying
“telecommunications” that transport them. See, e.g.,
Amendment of Section 64.702 of the Commission’s Rules &
Regulations (Second Computer Inquiry), 77 F.C.C. 2d 384, 475,
¶ 231 (1980); Universal Service Report, 13 F.C.C.R. 24012,
24030, ¶ 36 (1998); CALEA Second Report & Order, 15
F.C.C.R. 7105, 7120, ¶ 27 (1999); CPE/Enhanced Services
Bundling Order, 16 F.C.C.R. 7418, 7444, ¶ 43 (2001); Section
271 Remand Order, 16 F.C.C.R. 9751, 9770, ¶ 36 (2001);
Wireline Broadband Order, 20 F.C.C.R. 14853, 14864, ¶ 16
 18

(2005).6 The FCC reasonably applied that well-settled
distinction to give meaning to both the SRP and the information-
services exclusion in the context of broadband providers.
Accordingly, we deny the petition for review.

B

ACE next argues that the Commission arbitrarily and
capriciously “refused to classify VoIP as either a
telecommunications service or an information service.” Pet. Br.
at 33. At oral argument, ACE’s counsel clarified that it is not
challenging the merits of VoIP’s classification in one category
or the other; ACE argues only that the Commission must
classify it. See Tr. of Oral Arg. at 13:14-19:03. We need not
tarry long over this claim.

As we explained above, CALEA says nothing about
“telecommunications service[s].” To the extent ACE and its
fellow petitioners confusedly petitioned the Commission to

6
Our dissenting colleague argues that “[p]rior to the issuance
of the instant Order, the Commission has consistently held that
broadband Internet service is an ‘information service.’ It has never
previously said otherwise. Indeed, it has never hinted otherwise.”
Dissent at 6. However, the Commission has consistently recognized
that the telecommunications and information components of
broadband are distinguishable. The fact that the Commission treated
those components as an integrated service-offering under one statute
does not preclude the Commission from reasonably treating those
differentiable components differently under a different statute. Cf.
Brand X, 125 S. Ct. at 2699-2700 (“[I]f the agency adequately
explains the reasons for a reversal of policy, change is not
invalidating, since the whole point of Chevron is to leave the
discretion provided by the ambiguities of a statute with the
implementing agency.” (internal quotation marks and citation
omitted)).
 19

(mis)classify VoIP in relation to a nonexistent statutory term,
the FCC did not err by declining the invitation. Moreover, ACE
ignores the fact that the Commission did classify VoIP providers
as “telecommunications carriers,” see Order, 20 F.C.C.R.
14989, ¶¶ 39-44, while specifically excluding the voice-
transmission portions of VoIP from the definition of
“information services,” see id. ¶ 45. Regardless of the merits of
that classification—which ACE does not challenge—no one can
deny that the Commission made it.

C

ACE’s third and final argument focuses on a single word
in a single sentence in a single footnote from the Order. The
Commission noted: “To the extent [that] private networks are
interconnected with a public network, either the [public voice
network] or the Internet, providers of the facilities that support
the connection of the private network to a public network are
subject to CALEA under the SRP.” Order, 20 F.C.C.R. 14989,
¶ 36 n.100 (emphasis added). Relying on language from the
proposed rule, ACE insists that the inclusion of the word
“support” in the FCC’s final rule “provides no real comfort” for
its fears that the Commission will extend its regulatory authority
“throughout [an] entire private network.” Pet. Br. at 46.

Although ACE’s argument suggests the point is not
necessarily self-evident, it should go without saying that a
proposed rule is not a final rule. It should be equally obvious
that a challenge to the Commission’s possible future
applications or extensions of CALEA does not ripen by virtue
of a petitioner’s unfounded fears. See, e.g., Fed. Express Corp.
v. Mineta, 373 F.3d 112, 119 (D.C. Cir. 2004) (holding “if and
when [the petitioner’s fear] does come to pass, judicial review
of the issue ‘is likely to stand on a much surer footing in the
context of a specific application of this regulation than could be
 20

the case in the framework of the generalized challenge made
here.’” (quoting Toilet Goods Ass’n, Inc. v. Gardner, 387 U.S.
158, 164 (1967)); Atl. States Legal Found. v. EPA, 325 F.3d
281, 284-85 (D.C. Cir. 2003) (holding a speculative fear about
possible future agency action does not present a case or
controversy ripe for review). The Order on review—like
CALEA—expressly excludes “private networks” from its reach.
See Order, 20 F.C.C.R. 14989, ¶ 36; 47 U.S.C. § 1002(b)(2)(B).
If and when the Commission expands its interpretation, an
aggrieved party can bring a petition for review at that time.

III

For the reasons set forth above, the petition for review is

Denied.
 EDWARDS, Senior Circuit Judge, dissenting:
Regardless of how serious the problem an
administrative agency seeks to address . . . it may
not exercise its authority in a manner that is
inconsistent with the administrative structure
that Congress enacted into law.
FDA v. Brown & Williamson Tobacco Corp., 529
U.S. 120, 125 (2000).
The Communications Assistance for Law Enforcement Act
(“CALEA”) sets forth “assistance capability requirements,”
compelling “telecommunications carriers” to build and sustain
their equipment in a manner that allows law enforcement agents
to execute surveillance orders. Importantly, for purposes of this
case, the statute
• explicitly states that “telecommunications carrier[s]”
do not include “persons or entities insofar as they are
engaged in providing information services,” 47 U.S.C.
§ 1001(8)(C)(i) (2000),
• defines “information services” as “the offering of a
capability for generating, acquiring, storing,
transforming, processing, retrieving, utilizing, or
making available information via
telecommunications,” id. § 1001(6)(A), and
• expressly states that the assistance capability
requirements “do not apply to [ ] information services,”
id. § 1002(b)(2)(A).
In determining that broadband Internet providers are subject
to CALEA as “telecommunications carriers,” and not excluded
pursuant to the “information services” exemption, the
Commission apparently forgot to read the words of the statute.
CALEA does not give the FCC unlimited authority to regulate
every telecommunications service that might conceivably be
used to assist law enforcement. Quite the contrary. Section
1002 is precise and limited in its scope. It expressly states that
 2

the statute’s assistance capability requirements “do not apply to
[ ] information services.” Id. Broadband Internet is an
“information service” – indeed, the Commission does not
dispute this. Therefore, broadband Internet providers are
exempt from the substantive provisions of CALEA.
__________
The FCC apparently believes that law enforcement will be
better served if broadband Internet providers are subject to
CALEA’s assistance capability requirements. Although the
agency may be correct, it is not congressionally authorized to
implement this view. In fact, the “information services”
exemption prohibits the FCC from subjecting broadband service
providers to CALEA’s assistance capability requirements. If the
FCC wants the additional authority that Congress withheld, it
must lobby for a new statute. Until Congress decides that the
“information services” exemption is ill-advised, the agency is
bound to respect the legislature’s will and we are bound to
enforce it. See Ry. Labor Executives’ Ass’n v. Nat’l Mediation
Bd., 29 F.3d 655, 671 (D.C. Cir. 1994) (en banc) (“Were the
courts to presume a delegation of power absent an express
withholding of such power, agencies would enjoy virtually
limitless hegemony, a result plainly out of keeping with Chevron
and quite likely with the Constitution as well.”).
What we see in this case is an agency attempting to squeeze
authority from a statute that does not give it. The FCC’s
interpretation completely nullifies the information services
exception and manufactures broad new powers out of thin air.
__________
The most troubling aspect of the FCC’s interpretation of
CALEA is that it is directly at odds with the statutory language.
The statute defines “information services” as the offering of
various information capabilities via telecommunications. 47
U.S.C. § 1001(6)(A). See Appendix. The offering of one of the
 3

specified information capabilities “via telecommunications” is
integral to the definition of exempt services. Despite this clear
language, the Commission’s Order states that “when a single
service comprises an information service component and a
telecommunications component, Congress intended CALEA to
apply to the telecommunications component.” Communications
Assistance for Law Enforcement and Broadband Services, First
Report and Order and Notice of Proposed Rulemaking, 20
F.C.C.R. 14,989 ¶ 21 (2005) (“Order”). This is utter
gobbledygook, and it certainly cannot be what Congress
intended. Under the plain words of the statute, exempt
information services are those specified services that include a
telecommunications component. If, as the FCC would have it,
the telecommunications component is excised, the statutorily
defined exemption no longer exists. This makes no sense.
The net effect of the FCC’s interpretation is to vitiate the
statutory exception altogether. If all information services that
are carried out “via telecommunications” are subject to CALEA,
then the “information services” exemption is an empty set.
Under the plain terms of the statute, this cannot be.
In the face of this reality, the Commission offers an
example of a service that, under its interpretation, allegedly falls
within the information services exception – the “storage
functions of [a broadband Internet access provider’s] e-mail
service.” Order at ¶ 38. The example highlights the absurdity
of the agency’s position. Once email storage functions are
viewed apart from the telecommunications mechanism used to
transmit email messages, there is no sense in which email
services are offered “via telecommunications.” Thus defined,
email storage services fall outside of the statutory exception and
are thus potentially subject to CALEA’s requirements.
__________
 4

If the FCC had construed CALEA’s information services
exception consistent with the parallel provision in the
Communications Act – which is identical in all relevant
respects, compare 47 U.S.C. § 1001(6) (2000) (CALEA) with id.
§ 153(20) (Communications Act) – the agency would have given
full effect to every provision of CALEA. And the FCC could
have relied on the statute’s “substantial replacement” provision
to apply CALEA to services that are not information services
and that do not otherwise fit within the definition of
telecommunications carrier.
VoIP is an example of such a service. There is no doubt
that VoIP replaces a substantial portion of local telephone
exchange service – it offers exactly the same functionality as
phone service. And, in contrast to broadband service, the
Commission has explicitly refrained from designating VoIP as
an information service under the Communications Act, see
Federal-State Joint Board on Universal Service, Report to
Congress, 13 F.C.C.R. 11,501, 11,541 ¶ 83 (1998).
__________
It seems that the Commission had little interest in reading
CALEA in a manner that is consistent with the statute’s
language and structure. The Commission’s argument is quite
revealing. By emphasizing the need to construe CALEA to
“ensur[e] that technological change [does] not erode lawful
surveillance authority,” FCC’s Br. at 30, the Commission
betrays its true objective: administrative amendment of the
statute. Our standard for reviewing an agency’s interpretation
of congressional commands does not permit us to ratify the
FCC’s unauthorized attempt to legislate new and better tools for
law enforcement.
As Chevron and its progeny teach, an “agency’s
interpretation of the statute is not entitled to deference absent a
delegation of authority from Congress to regulate in the areas at
 5

issue.” Motion Picture Ass’n of Am., Inc. v. FCC, 309 F.3d 796,
801 (D.C. Cir. 2002). In MCI Telecommunications Corp. v.
American Telephone & Telegraph Co., 512 U.S. 218 (1994), the
Court held that the FCC’s congressionally authorized ability to
modify the § 203 requirements of the Communications Act did
not permit the agency to make basic and fundamental changes
in the statute’s regulatory scheme. In refusing to ratify the
Commission’s interpretation of the statute, the Court found it
“highly unlikely that Congress would leave the determination of
whether an industry will be entirely, or even substantially,
rate-regulated to agency discretion – and even more unlikely
that it would achieve that through such a subtle device as
permission to ‘modify’ rate-filing requirements.” Id. at 231.
The Supreme Court reiterated this view in Brown &
Williamson. There the Court rejected an attempt by the Food
and Drug Administration to regulate tobacco products, noting
that “Congress could not have intended to delegate a decision of
such economic and political significance to an agency in so
cryptic a fashion.” 529 U.S. at 160. See also Am. Library Ass’n
v. FCC, 406 F.3d 689 (D.C. Cir. 2005) (an agency does not
possess plenary authority to act within a given area simply
because Congress has endowed it with some authority to act in
that area); Am. Bar Ass’n v. Federal Trade Comm’n, 430 F.3d
457 (D.C. Cir. 2005) (same).
Similar considerations militate against the proposition that,
in enacting CALEA, Congress quietly granted the FCC the
authority to subject a new industry – providers of broadband
service – to the intrusive requirements of the statute. In gauging
the plausibility of the FCC’s purported authority, one surely
must look to the FCC’s treatment of the “information services”
exception under the Communications Act. A term in one statute
does not necessarily control the Commission’s actions under
another statute. But here the Commission’s earlier rulings show
that “information services” has become a term of art. The
 6

agency cannot simply ignore its prior consistent constructions of
“information services,” especially when it offers no coherent
alternative interpretation. Under the Commission’s current
order, “information services” is meaningless.
Prior to the issuance of the instant Order, the Commission
has consistently held that broadband Internet service is an
“information service.” It has never previously said otherwise.
Indeed, it has never hinted otherwise. For example, in its
Declaratory Ruling on the status of cable modem service under
the Communications Act, the Commission held:
As currently provisioned, cable modem service is a
single, integrated service that enables the subscriber to
utilize Internet access service through a cable
provider’s facilities and to realize the benefits of a
comprehensive service offering.
. . . Consistent with the statutory definition of
information service, cable modem service provides the
capabilities described above “via telecommunications.”
That telecommunications component is not, however,
separable from the data-processing capabilities of the
service. As provided to the end user the
telecommunications is part and parcel of the cable
modem service and is integral to its other capabilities.
Inquiry Concerning High-Speed Access to the Internet Over
Cable and Other Facilitites, Declaratory Ruling and Notice of
Proposed Rulemaking,17 F.C.C.R. 4798, 4823 ¶¶ 38-39 (2002)
(internal citations omitted). See also Appropriate Framework
for Broadband Access to the Internet over Wireline Facilities,
Report & Order & Notice of Proposed Rulemaking, CC Docket
No. 02-33, FCC 05-150, ¶ 15 (rel. Sept. 23, 2005) (“Because
wireline broadband Internet access service inextricably
combines the offering of powerful computer capabilities with
telecommunications, we conclude that it falls within the class of
 7

services identified in the Act as ‘information services.’”);
Federal-State Joint Board on Universal Service, 13 F.C.C.R. at
11,539 ¶ 80 (“The provision of Internet access service involves
data transport elements . . . . But the provision of Internet access
service crucially involves information-processing elements as
well; it offers end users information-service capabilities
inextricably intertwined with data transport. As such, we
conclude that it is appropriately classed as an ‘information
service.’”) (internal citations omitted).
There is no doubt that an “initial agency interpretation is not
instantly carved in stone”; nor is there any doubt that, if acting
pursuant to delegated authority, an agency may adopt different
interpretive positions to address different problems. See Nat’l
Cable & Telecomm. Ass’n v. Brand X Internet Servs., 125 S. Ct.
2688, 2700 (2005) (quoting Chevron U.S.A. Inc. v. Natural
Resources Defense Council, Inc., 467 U.S. 837, 863-64 (1984)).
But these points are of no moment in this case.
The question here is whether the FCC has identified a
statutory predicate for enlarging CALEA’s scope to encompass
providers of broadband access. It has not. Merely saying that
broadband is not an information service does not make it so,
certainly not in light of all that the FCC has said in the past.
And merely invoking law enforcement, “as though it were a
talisman under which any agency decision is by definition
unimpeachable,” Motor Vehicle Mfrs. Ass’n of the United States,
Inc. v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 50 (1983),
offends good sense.
The FCC can no more contend that “information service”
providers are really “telecommunications carriers” because their
regulation can facilitate the law enforcement purposes of
CALEA, than the agency could assert that those who operate
“movie theaters” are really “radio broadcasters” because their
regulation would facilitate control of indecent material pursuant
to 18 U.S.C. § 1464 (2000). There is absolutely no permissible
 8

basis for this court to sustain the FCC’s convoluted attempt to
infer broad new powers under CALEA. The agency has simply
abandoned the well-understood meaning of “information
services” without offering any coherent alternative interpretation
in its place. The net result is that the FCC has altogether gutted
the “information services” exemption from CALEA. Only
Congress can modify the statute in this way.
 9
APPENDIX
The Applicable Provisions of the Communications Assistance for Law
Enforcement Act, 47 U.S.C. § 1001 et seq.
47 U.S.C. § 1001. Definitions.
****
(6) The term “information services” –
(A) means the offering of a capability for generating, acquiring, storing,
transforming, processing, retrieving, utilizing, or making available
information via telecommunications; and
(B) includes –
(i) a service that permits a customer to retrieve stored information
from, or file information for storage in, information storage
facilities;
(ii) electronic publishing; and
(iii) electronic messaging services; but
(C) does not include any capability for a telecommunications carrier’s internal
management, control, or operation of its telecommunications network.
****
(8) The term “telecommunications carrier” –
***
(C) does not include –
(i) persons or entities insofar as they are engaged in providing
information services;
****
47 U.S.C. § 1002. Assistance capability requirements.
(a) Capability requirements
. . . a telecommunications carrier shall ensure that its equipment, facilities, or
services that provide a customer or subscriber with the ability to originate, terminate,
or direct communications are capable of [serving government needs in intercepting
digital and other communications] . . . .
(b) Limitations
****
(2) Information services; private networks and interconnection services and
facilities
The requirements of subsection (a) of this section do not apply to –
(A) information services;
****