RPT-UPDATE 1-U.S. appeals court upholds California net neutrality law

(Repeats for additional subscribers, no changes)

By David Shepardson

WASHINGTON, Jan 28 (Reuters) - A U.S. Court of Appeals on Friday upheld California's net neutrality law, saying a 2017 decision by the Federal Communications Commission to reverse federal internet protections could not bar state action.

In February 2021, the Justice Department withdrew its legal challenge to California's state net neutrality law, which is aimed at protecting the open internet.

The 9th Circuit Court of Appeals rejected a challenge from telecom and broad industry groups, ruling that since the FCC reclassified internet services as more lightly regulated information services the commission "no longer has the authority to regulate in the same manner that it had when these services were classified as telecommunications services."

California's 2018 law barred internet service providers from blocking or throttling traffic, or offering paid fast lanes, but it only took effect last year.

The FCC under former President Barack Obama, a Democrat, adopted net neutrality rules in 2015. These were overturned in 2017 by the FCC under President Donald Trump, a Republican. California's legislature responded by adopting a state law requiring net neutrality in August 2018.

The Justice Department reversed its decision soon after President Joe Biden, a Democrat, took office.

Supporters of net neutrality argue that the protections ensure a free and open internet. Broadband and telecoms trade groups contend their legal basis from the pre-internet era was outdated and that they would discourage investment.

California had agreed not to enforce the law while legal proceedings were ongoing.

FCC Chair Jessica Rosenworcel said Friday the decision was "good news" and added the government needs "once again to make it the law of the land."

The FCC remains divided 2-2. Democrats have been unable to launch proceedings to reinstate net neutrality. A Senate committee is set to vote on Democratic FCC commissioner nominee Gigi Sohn next week.

John Bergmayer, Legal Director at Public Knowledge, said the decision was "a major victory for internet users in California and nationwide." (Reporting by David Shepardson; Editing by Hugh Lawson)