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Disclosure, Deception and Deep-Packet Inspection: The Role of the Federal Trade Commission Act's Deceptive Conduct Prohibitions in the Net Neutrality Debate

72 Pages Posted: 2 Dec 2009 Last revised: 21 Apr 2013

Catherine J.K. Sandoval

Assistant Professor, Santa Clara University School of Law

Date Written: November 15, 2009

Abstract

This Article examines a largely unexplored frontier in the “Net Neutrality” debate: the Federal Trade Commission (FTC) Act’s proscriptions against deceptive conduct as a legal limit on Internet Service Provider (ISP) discrimination against Internet traffic. ISP discrimination against certain types of Internet traffic has blossomed since 2005 when the Federal Communications Commission (FCC), with the Supreme Court’s blessing in NCTA v. Brand X and FCC, relieved ISPs from common-carrier regulations that prohibited discrimination and reclassified ISPs as “information service providers.” This Article argues that the Internet’s architecture and codes presumed common carriage, indicating that the Internet’s design and industry “self-regulation” cannot alone prevent ISPs who control access to the Internet’s physical layer from becoming its gatekeepers. The FTC and FCC must use their respective authority to police the gulf between ISP promises and practices, protect Internet users and competition, and safeguard the Internet itself as a source for innovation and a wide range of speech.

In August 2008 the FCC condemned cable-based ISP Comcast’s actions that interfered with subscriber use of peer-to-peer Internet protocols to legally share files and access Internet content, practices that contradicted Comcast’s offer of unfettered Internet access. While that order is being appealed and the FCC considers formal adoption of net neutrality principles, this Article examines Comcast’s actions in light of the FTC Act’s deceptive practices standards. It also analyzes the market promises and terms of service of other cable, wireline, wireless, and satellite-based ISPs to examine industry practices that limit consumer choice and competition. To protect Internet users and the Internet itself as a platform for competition and new voices, the FCC should determine whether those practices violate the Communications Act. This Article also recommends that the FTC declare that ISP advertisements of unlimited data or Internet access violate the FTC Act’s deceptive conduct provisions when the ISP’s material limits on Internet use are not prominently highlighted in the ISP’s enticements to subscribers.

Keywords: Net Neutrality, Federal Trade Commission Act, FTC Act Deceptive Conduct, Deception, Deep-Packet Inspection, Disclosure, Federal Communications Commission, Internet, Common Carriers, Information Service Providers, Internet Service Providers, Antitrust, Contract Modification, Unfair Competition

JEL Classification: K2, K21, K23, K14, K12, L40, L41, L49

Suggested Citation

Sandoval, Catherine J.K., Disclosure, Deception and Deep-Packet Inspection: The Role of the Federal Trade Commission Act's Deceptive Conduct Prohibitions in the Net Neutrality Debate (November 15, 2009). Fordham Law Review, Vol. 78, p. 641, 2009. Available at SSRN: https://ssrn.com/abstract=1516705

Catherine J.K. Sandoval (Contact Author)

Assistant Professor, Santa Clara University School of Law ( email )

500 El Camino Real
Santa Clara, CA 95053
United States

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