During oral arguments on Comcast’s appeal of an FCC order that held the company liable for violations of the FCC’s 2005 policy statement on net neutrality, the D.C. Circuit Court of Appeals cast doubt on the FCC’s authority to sanction Comcast for blocking peer-to-peer (P2P) file transfers between users of the BitTorrent web site. One member of the three-judge panel told the FCC: “you have yet to identify a specific statute.” In August 2008, the FCC decreed that Comcast’s practice of throttling P2P file transfers between BitTorrent users during periods of network congestion constituted discriminatory conduct that violated the agency’s 2005 net neutrality principles. Although the FCC did not impose a fine, it ordered Comcast to cease its file blocking practices and to revise its network management policies. The FCC maintained that its authority to hold Comcast liable for violations of the 2005 policy statement derives from the agency’s ancillary jurisdiction under Title I of the 1934 Communications Act. Comcast challenged the FCC order on grounds that the 2005 policy guidelines lack the force of FCC regulations and that no FCC rules, therefore, were violated. Observers say that the court’s decision in the closely-watched case could impact ongoing FCC efforts to codify the 2005 net neutrality principles as part of the FCC’s rules. At Friday’s hearing, counsel for Comcast stressed that, in briefs filed with the court, the FCC “has not said it enforced any law . . . just pure policy.” As such, Comcast complained that it “had absolutely no notice that our conduct was regulated.” While FCC General Counsel Austin Schlick argued that the FCC had relied on ancillary jurisdiction conferred by Title I and by sections of the Communications Act that pertain to service and charges, market entry barriers, advanced telecommunications and the screening or blocking of offensive material, Judge A. Raymond Randolph replied, “you have jurisdiction, but where is the statute?” Asserting that, “the question here is, is there statutory authority,” Judge David Tatel observed, “if it is just a [policy] statement without any authority,” the ancillary rule provisions quoted by the FCC cannot form the basis for the FCC’s decision. The court is expected to issue its ruling in the case later this year. Declaring that “this case underscores the importance of the FCC’s ongoing rulemaking to preserve the free and open Internet,” FCC Chairman Julius Genachowski said, “I remain confident the Commission possesses the legal authority it needs.”