Federal law seeks to make communications technology like telephones and the internet, in the words of one older statute, “available, so far as possible, to all the people of the United States.” A longstanding federal program that seeks to implement this goal is now before the Supreme Court, in a case known as FCC v. Consumers’ Research, and the stakes could be enormous.
If the Supreme Court accepts an argument raised by a federal appeals court, which struck down the federal program, it would bring about one of the biggest judicial power grabs in American history, and hobble the government’s ability to do, well, pretty much anything.
The Court will hear arguments in Consumers’ Research on March 26.
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While Congress has long called for universal service for telecommunications and similar technology, there are practical obstacles to this goal, especially in rural areas that are far more expensive to wire because residents are more spread out. In these areas, if telephone and internet providers charged a fair market rate, their services could be prohibitively expensive.
Which is why Congress created the Universal Service Fund. It effectively taxes telephone and internet service providers, and uses that money to pay for service to underserved communities. As a practical matter, service providers pass the cost of these taxes on to their customers in urban and other cheap-to-serve areas, so Americans living in cities wind up subsidizing telephone and internet in more sparsely populated regions of the country.
Because the amount of money the Fund must raise to achieve universal service will vary from year to year, Congress also tasked the Federal Communications Commission (FCC) with determining how much money the Fund should collect from service providers each year. The statute also provides the FCC with detailed instructions on how to determine the amount it should collect, and how that money should be spent.
This program has hummed along without incident for nearly three decades — the Fund was created in 1996 — until the US Court of Appeals for the Fifth Circuit abruptly declared it unconstitutional. If you’re familiar with the Fifth Circuit’s work, you know that this kind of thing is common. The Fifth Circuit is the most right-wing appeals court in the federal system, and its judges often strike down decades-old laws based on unusually creative interpretations of the Constitution.
The Supreme Court, despite its 6-3 Republican majority, hands down a few cases every year reversing these Fifth Circuit decisions. Last May, for example, the Court reversed the Fifth Circuit’s attempt to strike down an entire federal agency, the Consumer Financial Protection Bureau.
Nevertheless, the Consumers’ Research case is worth watching for two reasons. One is that the Fifth Circuit’s decision was authored by Judge Andy Oldham, a Trump appointee who is widely considered a strong candidate for promotion to the Supreme Court in this administration. Oldham’s opinions are often sloppy, and his opinion in Consumers’ Research is no exception.
The second is that Oldham relied on a legal doctrine known as “nondelegation” in his opinion targeting the Universal Service Fund. The nondelegation doctrine claims there are strict constitutional limits on Congress’s power to empower federal agencies to do all kinds of things, from limiting pollution from power plants, to setting minimum standards for health insurance, to, at least if Oldham gets his way, providing broadband to rural communities.
The Supreme Court has only invoked this doctrine twice, both times in 1935, to strike down a federal law, and its decisions since then hold that the doctrine is more or less dead. Still, five of the Republican justices have, at various times, advocated for reviving the nondelegation doctrine. So there is a real risk that the Court could use the Consumers’ Research case as a vehicle to do so.
If that happens, it would shift a simply enormous amount of power from the elected branches of government to the judiciary. And it could potentially strip the federal government of a whole lot more than its power to equalize telephone and internet rates.
Why are the stakes in Consumers’ Research so high?
Congress frequently enacts laws which lay out a general policy, then task a federal agency with implementing that policy and determining how to achieve it. The law creating the Universal Service Fund, for example, lays out the broad goal of taxing communications service providers and using that money to ensure that everyone has access to those services. But it is also recognized that the amount of money that needs to be raised to achieve this goal, as well as the question of how that money should be distributed, is a moving target that needs to be periodically reassessed by the FCC.
Other laws delegate authority to an agency because technology evolves, and agencies employ experts who can monitor that technology and update federal policy accordingly. The Clear Air Act, for example, declares that certain power plants should use the “best system of emission reduction” that currently exists, while also accounting for factors such as costs. Because Congress recognized that the best system in 2025 will be more advanced than the best system that existed in 1972, it also tasked the EPA with determining what that system is and updating federal power plant regulations so that those plants use modern technology.
The stakes in the Consumers’ Research case are mitigated somewhat because the Court’s Republican majority has already given itself the power to veto federal agency actions.
The idea behind the nondelegation doctrine is that the Constitution limits Congress’s power to delegate power to agencies in this way, but there’s a big problem with it: The doctrine appears nowhere in the Constitution itself, so judges who wish to apply it cannot refer to any text to determine which delegations of power are not allowed. If nondelegation were revived, the only real factor governing which congressional delegations are allowed, and which ones must be struck down, would be whether five justices wanted to strike a particular law down.
Many right-leaning legal scholars have argued that this extraconstitutional doctrine is implicit in the Constitution, but it’s noteworthy that the people who actually wrote the Constitution disagreed with them. The First Congress made sweeping delegations of power to executive branch officials, giving them, among other things, the power to set regulations governing “all things touching” trade with indigenous tribes, and the power to grant patients so long as they “deem the invention or discovery sufficiently useful or important.”
And so the Supreme Court has historically treated the nondelegation doctrine with extraordinary suspicion. The Court did apply it twice, in 1935, to New Deal statutes which gave virtually unbounded power to President Franklin D. Roosevelt, but it has never done so again. Supreme Court decisions stretching back nearly a century permit Congress to delegate authority to federal agencies, so long as Congress “lay[s] down by legislative act an intelligible principle to which the person or body authorized to [exercise the delegated authority] is directed to conform.”
Though the current Supreme Court has not, at least not yet, struck down a law on nondelegation grounds, it did invent a similar legal doctrine — which, like nondelegation, cannot be found in the Constitution itself — known as the “major questions doctrine.” Under this doctrine, a majority of the Court may veto any action by a federal agency which five justices believe to be too politically or economically significant.
So the stakes in the Consumers’ Research case are mitigated somewhat because the Court’s Republican majority has already given itself the power to veto federal agency actions. But there’s also an important difference between major questions and nondelegation.
Under the major questions doctrine, the proper remedy, if five justices wish to veto an agency action, is to block that specific action — but to otherwise leave the federal law permitting the agency to act intact. The nondelegation doctrine, by contrast, often calls upon federal courts to toss out a statute delegating power to a federal agency altogether.
Basically, the Court has already given itself the power to make a targeted strike on any individual agency action it doesn’t like, but it could use Consumers’ Research to carpet bomb agencies’ authority, stripping them of any power to act in the future.
Oldham’s Consumers’ Research opinion is extremely sloppy
One reason the justices might stay their hands in Consumers’ Research is that this case is a poor vehicle for reviving the nondelegation doctrine. The statute governing the Universal Service Fund provides detailed instructions to the FCC on how it should exercise its authority — far more detail than Congress provided in many other statutes that the Supreme Court has upheld against nondelegation challenges, including cases involving executive branch policy on navigable waters, natural gas rates, and commodity prices. Some of the statutes upheld by the Supreme Court do little more than instruct agencies to remove “unreasonable” obstacles to commerce.
Oldham should have followed these decisions, as he should have followed the Court’s precedents requiring him to uphold the Universal Service Fund statute so long as it provides an “intelligible principle” that the FCC can use to guide its decisions.
The Universal Service Fund statute lays out six goals that the FCC should accomplish, in its efforts to provide telecommunications access to rural and poor communities. It specifies who should be taxed (“Every telecommunications carrier that provides interstate telecommunications services shall contribute”), and who should benefit from this tax revenue. And it instructs the FCC on how to determine the rate of taxation.
One provision, for example, states that rural customers should receive service “at rates that are reasonably comparable to rates charged for similar services in urban areas.” Thus, the FCC must tax service providers at a high enough rate to ensure that rural customers pay similar rates to urban customers, but not at such a high rate that rural customers pay significantly less than urban customers.
There’s simply no question, in other words, that the Universal Service Fund statute provides an “intelligible principle” to guide the FCC’s decisions.
The Universal Service Fund would likely survive judicial review even under a more aggressive approach to nondelegation favored by some members of the Court. Dissenting in Gundy v. United States (2019), for example, Justice Neil Gorsuch proposed replacing the intelligible principle standard with a vague new rule providing that Congress must put “forth standards ‘sufficiently definite and precise to enable Congress, the courts, and the public to ascertain’ whether Congress’s guidance has been followed” whenever it delegates power. Here, Congress has laid out definite and precise rules governing who the FCC should tax, how much it should tax them, and how that revenue should be spent.
So how, then, did Oldham justify striking down the Universal Service Fund? The answer is he took extraordinary liberties with the law, ignoring most of the statute, openly defying the Supreme Court’s decisions, and simply making up new rules along the way.
At one point, for example, Oldham claims that only two provisions of the statute are “relevant” to determining whether it violates the nondelegation doctrine – a provision stating that the FCC should raise funds “sufficient … to preserve and advance universal service,” and another provision indicating telecommunications services “should be available at … affordable rates.”
If these were the only instructions the statute provided to the FCC, then Consumers’ Research might be a more difficult case. But, of course, Congress said a whole lot more than these two things when it instructed the FCC on how to wield its authority.
Oldham also relies on a concurring opinion, by Fifth Circuit Judge Edith Jones, which the Supreme Court repudiated last spring. He places a simply enormous amount of weight on the fact that the FCC created a corporation, known as the Universal Service Administrative Company, which advises it on how to set Universal Service Fund rates. But the Supreme Court held in Sunshine Anthracite Coal v. Adkins (1940) that these sorts of advisory bodies are “unquestionably valid.”
It appears, in other words, that Oldham started with the result he wanted — striking down the Universal Service Fund — and then wrote an opinion pretending that the law actually supports his preferred outcome.
So how is the Supreme Court likely to approach this case?
Realistically, it is unlikely that even this Supreme Court will strike down the Universal Service Fund. The statute is too detailed, and Oldham’s opinion is too nonsensically argued, to justify the result the Fifth Circuit wants to achieve.
One thing to watch out for, however, is whether the Republican justices attempt to shift the law governing nondelegation cases, while still upholding the Fund. The Court could, for example, write an opinion repudiating the intelligible principle test and upholding the Fund under Gorsuch’s more “sufficiently definite and precise” standard — a standard that, because of its vagueness, would give judges far more discretion to strike down laws they do not like on nondelegation grounds.
So, while Oldham is unlikely to succeed in his ambitious attempt to sabotage the Fund, he may nonetheless achieve a significant victory. By ignoring the law in his Consumers’ Research opinion, Oldham gave the justices an opportunity to revive a dangerous legal doctrine, and to do so in an opinion that appears moderate compared to the reactionary Fifth Circuit.
