Huawei Technologies USA, Inc. v. Federal Communications Commission, No. 19-60896 (5th Cir. 2021)Annotate this Case
The Fifth Circuit denied Huawei's petition for review challenging an FCC rule barring the use of government subsidies to buy equipment from companies designated security risks to communications networks. As a preliminary matter, the court dismissed Huawei's claims related to the initial designation for lack of jurisdiction based on ripeness grounds.
The court concluded that the FCC reasonably interpreted its authority under the Communications Act in formulating the rule. The court found that the agency reasonably interpreted the Act's "public interest" provisions (47 U.S.C. 254(c)(1)(D), in coordination with section 201(b)), to authorize allocation of universal service funds based on the agency's exercise of limited national security judgment. Furthermore, the agency reasonably interpreted the "quality services" provision in section 254(b)(1) to support that exercise. Therefore, the court deferred to the agency's interpretation under Chevron review and rejected Huawei's argument that the agency lacked statutory authority for the rule. The court also considered the companies' other challenges under the Administrative Procedure Act and the Constitution, finding that claims regarding adequacy of notice, arbitrary and capricious review, vagueness, and due process are unavailing.