False advertising claim over broadband speed stayed

Hart v. Comcast of Alameda, 2008 WL 2610787 (N.D. Cal.)

Hart sued Comcast for unfairly discriminating against peer-to-peer filesharing applications, in violation of the Computer Fraud & Abuse Act, California false advertising law, and other laws.

The court stayed the case using the primary jurisdiction doctrine, which applies when an initial decision should be made by a relevant agency rather than a court. The 9^th Circuit uses a four-factor test: “(1) the need to resolve an issue that; (2) has been placed by Congress within the jurisdiction of an administrative body having regulatory authority; (3) pursuant to a statute that subjects an industry or activity to a comprehensive regulatory scheme that; (4) requires expertise or uniformity in administration.”

The test was satisfied here—plaintiff’s complaint alleged that discrimination against P2P services violated FCC policy. The question of whether “network management” of this type is reasonable is within the FCC’s extensive jurisdiction over broadband. Two petitions on the matter are currently pending before the FCC, asking for specific rules on (1) discriminating against particular internet applications and (2) barring Comcast from “managing” P2P applications. The FCC has announced that it will investigate Comcast’s conduct and has sought public comment. These issues also require expertise and uniformity in administration.

The stay applied to all the claims, even though not all of them concerned the reasonableness of Comcast’s acts. The breach of contract and false advertising claims were “sufficiently interrelated” with the network management issue that the FCC’s conclusions could affect the resolution of those claims. If Comcast promoted and advertised fast speeds while severely limiting P2P speed, that might not be false advertising if it’s ok to limit P2P speed. (Comment: I squinted pretty hard at that. If it’s relevant to consumers, then there might be a need to disclose a qualification of a speed claim even if discrimination in speed is allowed by the FCC. The question, I would have thought, was whether reasonable consumers understood the speed claim to cover all services, not whether the law required Comcast to provide all services at equal speed. That said, if discrimination is not ok, then it becomes even more reasonable for consumers to expect equal speed—but again, it might be reasonable anyway.)