FCC fee violates the Constitution, Consumers’ Research decision says
On July 24, the en banc U.S. Court of Appeals for the Fifth Circuit broke with the Sixth and Eleventh Circuits (as well as the original Fifth Circuit panel) in a case about the delegation of legislative power to the Federal Communications Commission and sub-delegation to a private entity—the Universal Service Administrative Company.
I wrote about this case—Consumers’ Research v. FCC—last month after the Supreme Court refused to hear similar cases. At issue is the nondelegation doctrine, which holds Congress can’t delegate lawmaking authority to executive branch agencies. In this case, the Fifth Circuit concluded that the Universal Service fee imposed on telecom providers by the Federal Communications Commission violates the Constitution.
In the decision, the Fifth Circuit first analyzed the non-delegation issue and concluded it had “grave concerns” about the constitutionality of the Telecommunications Act of 1996’s provision authorizing the FCC to exercise what it concluded was Congress’s taxing power. It then expressed its skepticism that the FCC’s sub-delegation of authority to a private company comports with the general rule against allowing private entities to wield government power.
But the en banc court held that it did not need to decide either question definitively because the combination of the statutory and the private delegations violates Article I’s vesting of the legislative power in Congress. The court relied on recent Supreme Court decisions concerning the removal of executive branch officers and taking what the Fifth Circuit termed a “holistic” approach to separation of powers challenges, concluding that potentially constitutional provisions that would survive scrutiny alone may violate the Constitution when taken together.
I had previously speculated that in denying review of the Sixth and Eleventh Circuit decisions in similar cases, the Supreme Court may be waiting for a circuit split (and, indeed, the government had urged it to deny cert for that reason, among others).
It wasn’t clear whether that split would manifest, however, as even judges skeptical of sweeping delegations have generally considered themselves bound by the Supreme Court’s reluctance to police Congress on those grounds. (See, for example, the concurrence from Judge Kevin Newsom last year in a nearly identical case upholding the delegation in the Eleventh Circuit.)
Nevertheless, the split arrived in short order. The Fifth Circuit’s “holistic” approach, which cites Aristotle’s Metaphysics to conclude that “with respect to the separation of powers at least, two constitutional parts do not necessarily add up to a constitutional whole,” substantially increases the likelihood that the Supreme Court will grant review, either of this decision or in the Sixth or Eleventh Circuit cases for which the petitioners have requested rehearing of June’s petition denials.
Predictions are a fool’s game, but if I had to make one (and the irritating fellow on my left shoulder insists now that I do), I would wager that the Supreme Court is unlikely to adopt the Fifth Circuit’s analysis. Not because it’s wrong, necessarily, but because it would incentivize a near-endless wave of litigants trying to combine two uncertain—or even previously rejected—constitutional arguments into the sum of more than their parts. And it would let lower courts off the hook in making reasoned, if difficult, decisions about whether any individual alleged violation is a winning argument on its own; that’s not particularly helpful for the development of constitutional law.
So, the Supreme Court will likely either provide clarity on the continued viability of the non-delegation doctrine (legislative or private) or stay the course in avoiding that question by supplying yet another narrowing construction of a statute that—to the rest of us—seems to delegate broad policy-making power to the administrative state. That would be unfortunate because exercising legislative power requires the weighing of competing priorities and the Constitution assigns that task to Congress, a body that, with its diversity of membership and compromise-forcing mechanisms, represents all Americans more fairly than any one man (or woman) or multi-headed commission ever could.
