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FCC Wants a Rehearing

The Federal Communications Commission plans to seek rehearing from the 9th U.S. Circuit Court of Appeals regarding an October ruling that tossed out the agency's classification of cable-modem service.

The FCC had the option of filing an appeal with the U.S. Supreme Court. But commissioner Kathleen Abernathy told reporters last Wednesday that the agency would seek rehearing, also called an en banc review.

"We are going to go en banc," she said.

A three-judge panel of the 9th Circuit held that it was bound by a decision in 2000 that cable-modem service was both an information service and a telecommunications service. As a result, the panel, without analyzing the substance of the FCC's order, vacated the FCC's March 2002 ruling that cable-modem service was exclusively an information service.

If the 9th Circuit's ruling were to stand, cable-modem service could become subject to common-carrier regulation — something the industry wants to avoid.

The FCC, though, has forbearance authority to exempt cable-modem service from traditional telecommunications regulation.

Abernathy said the 9th Circuit's decision cast a cloud over the FCC's larger broadband agenda. The agency tentatively decided that a phone company that offered retail digital subscriber line service was not offering a telecommunications service.

"I think it puts things on hold," she added. "What this means is that we are going to, I think, have to be at a standstill for a little bit while we see what happens in the court, because I think it would be not wise to more forward while we've got this litigation strategy."

If the 9th Circuit grants en banc review of the cable-modem case, the FCC could renew the DSL-classification proceeding, Abernathy said.

"That's an option. If they decide to grant rehearing en banc, we could go forward," she added.

Abernathy, chairman Michael Powell and commissioner Kevin Martin comprise the FCC's Republican majority.