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Nixon v. Missouri Municipal League, 541 U.S. 125 (2004) (full-text).
U.S. Supreme Court Proceedings Edit
The U.S. Supreme Court held that a provision of the 1996 amendment to the Communications Act of 1934 authorizing the preemption of state and local laws prohibiting "any entity" from providing a statutorily defined "telecommunications service" did not preempt state statutes that bar political subdivisions from doing so. The Court noted, however, that "in any event the issue here does not turn on the merits of municipal telecommunications services"
The Court recognized that, in some cases, it may be a "respectable position" to argue "that fencing governmental entities out of the telecommunications business flouts the public interest." The Court also recognized, however, that "there are . . . arguments on the other side, against government participation. . . ." In particular, the Court noted that "(if things turn out bad) government utilities that fail leave the taxpayers with the bills," and that "in a business substantially regulated at the state level, regulation can turn into a public provider's weapon against private competitors. . . ."