Techworld has a nice summary of the hybrid solution:
“The hybrid approach Wheeler reportedly favors would divide broadband into two services for the purpose of regulation.
One service would be retail broadband access, which would remain lightly regulated, and the second would be back-end transit service, which the FCC would reclassify as a regulated common carrier, similar to utility-style regulation for traditional telephone service. Mozilla proposed this type of hybrid regulatory model back in May.
Under the Mozilla plan, the FCC would divide last-mile broadband service into two "distinct relationships," one between the broadband provider and the end user, and the second a remote delivery service offered by the broadband provider to websites, cloud storage and other online services.”
As for Verizon’s threat to sue...they don’t want any regulation. They only want laws that benefit them directly, and nothing that forces them to do anything.