BellSouth Corp v. FCC

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued February 20, 1998 Decided May 15, 1998

No. 97-1113

BellSouth Corporation,

Petitioner

v.

Federal Communications Commission and

United States of America,

Respondents

AT&T Corporation, et al.,

Intervenors

On Petition for Review of an Order of the

Federal Communications Commission

Laurence H. Tribe argued the cause for petitioner. With

him on the briefs were Jonathan S. Massey, Walter H.

Alford, William B. Barfield, M. Robert Sutherland, Michael

K. Kellogg, Mark L. Evans and Robert B. McKenna.

Jacob M. Lewis, Attorney, U.S. Department of Justice,

argued the cause for respondents. With him on the briefs

were Frank W. Hunger, Assistant Attorney General, Stephen

W. Preston, Deputy Assistant Attorney General, Mark B.

Stern, Attorney, Christopher J. Wright, General Counsel,

Federal Communications Commission, and John E. Ingle,

Deputy Associate General Counsel. Catherine G. O'Sullivan

and Nancy C. Garrison, Attorneys, U.S. Department of Jus-

tice, and Carl D. Lawson, Counsel, Federal Communications

Commission, entered appearances.

Donald B. Verrilli, Jr. argued the cause for intervenors

AT&T Corp., and MCI Telecommunications Corp. With him

on the brief were David W. Carpenter, Peter D. Keisler,

Matthew B. Pachman, Mark C. Rosenblum and Roy E.

Hoffinger. Frank W. Krogh entered an appearance.

Before: Edwards, Chief Judge, Williams and Sentelle,

Circuit Judges.

Opinion for the Court filed by Circuit Judge Williams.

Dissenting opinion filed by Circuit Judge Sentelle.

Williams, Circuit Judge: Petitioner BellSouth Corporation

challenges the constitutionality of Section 274 of the Telecom-

munications Act of 1996 (the "Act"), 47 U.S.C. s 274, and of

the Federal Communications Commission's order implement-

ing that provision.1 Section 274 limits the ability of Bell

operating companies ("BOCs") to provide "electronic publish-

ing," a category that includes disseminating news articles,

offering literary material, and providing services similar to

the Lexis/Nexis and Westlaw databases. BellSouth says

s 274 is an unconstitutional bill of attainder, stressing the

fact that the subjects of its restrictions, the BOCs, are singled

__________

1 The order under challenge is Implementation of the Telecom-

munications Act of 1996: Telemessaging, Electronic Publishing,

and Alarm Monitoring Services, FCC No. 97-35 (Feb. 7, 1997).

BellSouth's challenge to the order is entirely derivative of its

constitutional challenge to the statute, with no claim that the FCC

acted outside the scope of its statutory authority.

out by name. BellSouth also complains that s 274 impermis-

sibly abridges its First Amendment rights of free expression.

We reject both challenges.

* * *

The story behind the Telecommunications Act of 1996 has

often been told, although electronic publishing restrictions

have usually amounted to little more than a subplot. In 1982

a consent decree was entered in settlement of the govern-

ment's 1974 antitrust suit against AT&T. That decree, as

modified by the district court, became known as the "Modifi-

cation of Final Judgment," or "MFJ." See United States v.

American Tel. & Tel. Co., 552 F. Supp. 131 (D.D.C. 1982),

aff'd sub nom. Maryland v. United States, 460 U.S. 1001

(1983). The MFJ required AT&T to divest itself of its local

exchange monopolies. Under the reorganization plan ap-

proved by the district court, the twenty BOCs eventually

named in the 1996 Act were spun off from AT&T and

grouped into seven regional Bell operating companies, or

"RBOCs" (now five thanks to mergers), of which BellSouth is

one.2

The MFJ initially prohibited the BOCs from providing

"information services," defined to include electronic publish-

ing. The prohibition rested on two concerns commonly

voiced about regulated monopolists operating in fields adja-

cent to their monopolies. First, to the extent that the

monopolist's good or service is an input for the adjacent

industry, the monopolist may offer its own enterprise discrim-

inatory advantages, in this case "favorable access to the local

network." 552 F. Supp. at 189. Second, the monopolist may

use monopoly revenues to subsidize its associated enterprise.

Id. In a "triennial review" process established by the decree,

the Department of Justice moved to lift the information

services restrictions, and no party to the decree opposed the

motion. The district court ultimately did lift them. United

States v. Western Electric Co., 767 F. Supp. 308 (D.D.C.

__________

2 AT&T also divested its minority holdings in the Cincinnati Bell

Telephone Company and the Southern New England Telephone

Company, which are not classified as BOCs in the Act.

1991), aff'd, 993 F.2d 1572 (D.C. Cir. 1993). We will return

later to the analysis supporting that result, which BellSouth

says helps its constitutional case against s 274.

The 1996 Act rescinded the MFJ, see Pub. L. No. 104-104,

s 601, 110 Stat. 143 (1996), and changed the entire telecom-

munications landscape. Several key provisions of the Act

apply to incumbent local exchange carriers generally, such as

47 U.S.C. s 251, requiring them to offer nondiscriminatory

access and interconnection to local competitors. Sections 271

through 276 of the Act, however, entitled "Special Provisions

Concerning Bell Operating Companies," are applicable to the

BOCs and their affiliates alone.3 For example, s 271 estab-

lishes requirements that must be met before the BOCs can

break into the long distance, or "interLATA," market, see

SBC Communications, Inc. v. FCC, 1998 WL 121492 (D.C.

Cir. Mar. 20, 1998); s 273 bars the BOCs from manufactur-

__________

3 The Act defines "Bell operating company" as follows:

The term "Bell operating company"--

(A) means any of the following companies: Bell Telephone

Company of Nevada, Illinois Bell Telephone Company, Indiana

Bell Telephone Company, Incorporated, Michigan Bell Tele-

phone Company, New England Telephone and Telegraph Com-

pany, New Jersey Bell Telephone Company, New York Tele-

phone Company, US West Communications Company, South

Central Bell Telephone Company, Southern Bell Telephone and

Telegraph Company, Southwestern Bell Telephone Company,

The Bell Telephone Company of Pennsylvania, The Chesapeake

and Potomac Telephone Company, The Chesapeake and Poto-

mac Telephone Company of Maryland, The Chesapeake and

Potomac Telephone Company of Virginia, The Chesapeake and

Potomac Telephone Company of West Virginia, The Diamond

State Telephone Company, The Ohio Bell Telephone Company,

The Pacific Telephone and Telegraph Company, or Wisconsin

Telephone Company; and

(B) includes any successor or assign of any such company

that provides wireline telephone exchange service; but

(C) does not include an affiliate of any such company, other

than an affiliate described in subparagraph (A) or (B).

47 U.S.C. s 153(4).

ing and selling telecommunications equipment until they have

received authorization to enter the interLATA market; and

s 275 prohibits BOCs (other than Ameritech) from providing

alarm monitoring services for five years, see Alarm Industry

Communications Committee v. FCC, 131 F.3d 1066, 1067

(D.C. Cir. 1997). In general these provisions simply main-

tained, and in most cases loosened, various restrictions to

which the BOCs were already subject under the MFJ. By

contrast, the provision at issue here--s 274--reimposed on

the BOCs some of the information services restrictions that

had been lifted in 1991. BellSouth challenges only that

provision and the FCC order of implementation.4

Section 274 provides:

No Bell operating company or any affiliate may engage

in the provision of electronic publishing that is dissemi-

nated by means of such Bell operating company's or any

of its affiliates' basic telephone service, except that noth-

ing in this section shall prohibit a separated affiliate or

electronic publishing joint venture operated in accor-

dance with this section from engaging in the provision of

electronic publishing.

47 U.S.C. s 274(a). Section 274's restrictions expire on Feb-

ruary 8, 2000, four years from the date of the Act's passage.

s 274(g)(2).

As is evident from its text, s 274 provides two pathways for

BOCs wishing to enter electronic publishing: the "separated

affiliate" route and the "joint venture" route. The statute

defines a separated affiliate as "a corporation under common

ownership or control with a Bell operating company that does

not own or control a Bell operating company and is not owned

or controlled by a Bell operating company." 47 U.S.C.

s 274(i)(9). An "electronic publishing joint venture" is a

"joint venture owned by a Bell operating company or affiliate

__________

4 We note that another RBOC has launched a Bill of Attainder

Clause and First Amendment challenge to the "Special Provisions"

as a whole. See SBC Communications, Inc. v. FCC, 981 F. Supp.

996 (N.D. Tex. 1997).

that engages in the provision of electronic publishing which is

disseminated by means of such Bell operating company's or

any of its affiliates' basic telephone service." 47 U.S.C.

s 274(i)(5). Section 274 imposes several structural require-

ments on both separated affiliates and electronic publishing

joint ventures. See generally 47 U.S.C. s 274(b). For exam-

ple, each such entity must maintain books, records, and

accounts separately from the BOC with which it is affiliated,

s 274(b)(1), may have "no officers, directors, and employees

in common" with a BOC, s 274(b)(5)(A), and may "own no

property in common," s 274(b)(5)(B).

The Act defines "electronic publishing" broadly as

the dissemination, provision, publication, or sale to an

unaffiliated entity or person, of any one or more of the

following: news (including sports); entertainment (oth-

er than interactive games); business, financial, legal,

consumer, or credit materials; editorials, columns, or

features; advertising; photos or images; archival or re-

search material; legal notices or public records; scien-

tific, educational, instructional, technical, professional,

trade, or other literary materials; or other like or simi-

lar information.

47 U.S.C. s 274(h)(1). It then exempts several types of

services, including data processing, voice messaging, and

video programming. 47 U.S.C. s 274(h)(2).

BellSouth, of course, is not a BOC but an RBOC. Yet the

government rightly refrains from raising a standing defense

on that ground. The injury BellSouth suffered as the sole

shareholder of two affected corporations (South Central Bell

Telephone Company and Southern Bell Telephone and Tele-

graph Company) is clearly enough to give it Article III

standing. See Franchise Tax Board of California v. Alcan

Aluminium Ltd., 493 U.S. 331, 336 (1990). Besides, as an

affiliate of two BOCs, s 274(i)(1), BellSouth is itself affected;

it can engage in electronic publishing only by maintaining

structural separation from its BOCs.

Bill of Attainder Challenge

We turn first to BellSouth's challenge under Article I,

section 9, clause 3 of the Constitution, which says that "[n]o

Bill of Attainder or ex post facto Law shall be passed" by

Congress. For the framers of the Constitution the term

"bills of attainder" carried a specific meaning: it referred to

parliamentary acts sentencing named persons to death with-

out the benefit of a judicial trial. As early as 1810, however,

in Fletcher v. Peck, 10 U.S. (6 Cranch) 87 (1810), Chief Justice

Marshall noted in dictum that the prohibition on bills of

attainder ought to extend to legislation subjecting specified

persons to penalties short of death--what the framers called

"bills of pains and penalties." Id. at 138; United States v.

Brown, 381 U.S. 437, 447 (1965). Later in the nineteenth

century the Supreme Court confirmed that the legislative

punishments foreclosed by the Bill of Attainder Clause in-

clude bills of pains and penalties. Cummings v. Missouri, 71

U.S. (4 Wall.) 277, 320, 323 (1866). Moreover, the Court has

recognized that not all bills of attainder expressly name their

targets; some simply describe them. Brown, 381 U.S. at 442.

In sum, the Court has developed a potentially sweeping

definition of forbidden attainders, holding that "legislative

acts, no matter what their form, that apply either to named

individuals or to easily ascertainable members of a group in

such a way as to inflict punishment on them without a judicial

trial are bills of attainder prohibited by the Constitution."

United States v. Lovett, 328 U.S. 303, 315-16 (1946). The

result is a prohibition triggered when a legislative act meets

two tests--first, that it apply with specificity, and second, that

it impose punishment.

Even classic attainders seem not only to have specified

individuals but also classes--defined as the confederates of a

named traitor, as in the case of the attainder against the Earl

of Kildare and his associates during the reign of Henry VIII.

See Cummings, 71 U.S. at 323-24. But the Supreme Court

watered down the specificity requirement a bit more when it

invalidated two post-Civil War enactments targeting all per-

sons who could not truthfully swear that they had been loyal

to the Union during the war. See Cummings; Ex parte

Garland, 71 U.S. (4 Wall.) 333 (1866). And in Lovett it said

generally that specificity is shown if the law applies to "easily

ascertainable members of a group." 328 U.S. at 315. Since

virtually all legislation operates by identifying the character-

istics of the class to be benefited or burdened, it is not clear

that the specificity requirement retains any real bite. In any

event, it is obviously met here, since s 274's requirements

apply uniquely to the twenty BOCs identified by name in the

Act.

We assume, as do the parties, that the Bill of Attainder

Clause protects corporations as well as individuals. Although

the Supreme Court has yet to address the question directly, it

has suggested as much in dictum, see Plaut v. Spendthrift

Farm, Inc., 514 U.S. 211, 239 n.9 (1995) (indicating that Bill of

Attainder Clause applies to laws that burden "a single indi-

vidual or firm"), and comparable constitutional rights have

been extended to legal "persons" taking the corporate form.

See, e.g., Metropolitan Life Ins. Co. v. Ward, 470 U.S. 869,

881 n.9 (1985) (equal protection); United States v. Martin

Linen Supply Co., 430 U.S. 564 (1977) (double jeopardy).

The clause's coverage clearly seems to include at least closely

held corporations, where an attainder would fall on a narrow-

ly circumscribed, easily identified group of flesh-and-blood

people.5 Given the parties' shared assumption, we will not

explore the issue further.

At times BellSouth comes close to arguing that the specifi-

cation requirement ought to be the end of the matter. On

this view, the Bill of Attainder Clause bars Congress from

singling out a specified class of persons for burdens of any

kind, regardless of whether those burdens can be viewed as

punishments in any ordinary sense of the term. This was the

__________

5 At least it would do so if it took the form of a conventional

penalty such as a fine. If it took the form of a restriction barring

certain closely held corporations from specific lines of business, its

effect on flesh-and-blood people would depend on the language of

the restriction and on the ability of officers, directors and share-

holders to carry on their pursuits outside the named corporations.

See below at pp. 12-13.

theme of a famous student essay, Note, The Bounds of

Legislative Specification: A Suggested Approach to the Bill

of Attainder Clause, 72 Yale L.J. 330 (1962), and traces of the

same approach can be found in the Supreme Court's most

extensive discussion (and most expansive application) of the

clause, United States v. Brown, 381 U.S. 437, 442 (1965). For

example, Brown said in a footnote that "a legislature can

provide that persons possessing certain characteristics must

abstain from certain activities, but must leave to other

tribunals the task of deciding who possesses those character-

istics." Id. at 454 n.29 (emphasis added). And Brown's

explanation of the clause "as an implementation of the separa-

tion of powers, a general safeguard against legislative exer-

cise of the judicial function, or more simply--trial by legisla-

ture," id. at 442, certainly lent itself to sweeping application.

Nonetheless, even Brown seemed at times to limit itself to

punishments, saying, for example, that the clause "reflected

the Framers' belief that the Legislative Branch is not so well

suited as politically independent judges and juries to the task

of ruling upon the blameworthiness of, and levying appropri-

ate punishment upon, specific persons." Id. at 445. Such a

limitation is practically indispensable: given the demise of the

requirement that a forbidden attainder fall on named individ-

uals, and the elusive character of Brown's own effort to

articulate a coherent specificity test to replace that require-

ment, see 381 U.S. at 455 n.29, a definition of attainder that

encompassed any burden imposed on specified individuals or

groups would cut a broad swath, mowing down much of the

Supreme Court's equal protection jurisprudence at a single

stroke.

In any event, whatever Brown's potential for diluting the

punishment requirement, the Supreme Court has since taken

that requirement seriously. It made this emphatically clear

in Nixon v. Administrator of General Services, 433 U.S. 425

(1977), where the law at issue burdened a single person.

Despite the statute's surgical focus on a sole individual, the

Court held that "the mere specificity of a law does not call

into play the Bill of Attainder Clause," id. at 471 n.33, and

indeed that Congress had on that occasion singled out "a

legitimate class of one," id. at 472.6 It insisted that the

burden must be a punishment to qualify as a bill of attainder,

and considered three questions in determining whether it

was. Id. at 478-84. Despite Chief Justice Burger's sugges-

tion that the Nixon precedent itself would become a "class of

one," id. at 544-45 (Burger, C.J., dissenting), the Court later

formalized the punishment inquiry into a three-part test,

asking

(1) whether the challenged statute falls within the histor-

ical meaning of legislative punishment; (2) whether the

statute, viewed in terms of the type and severity of

burdens imposed, reasonably can be said to further

nonpunitive legislative purposes; and (3) whether the

legislative record evinces a congressional intent to pun-

ish.

Selective Service System v. Minnesota Public Interest Re-

search Group, 468 U.S. 841, 852 (1984) (citations and internal

quotation marks omitted). Unlike our dissenting colleague,

Dissent at 3, 5, 6, we see no warrant in the precedents for

treating Congress's specification of the BOCs by name as a

material element in the punishment analysis. Cf. Brown, 381

U.S. at 461 (describing supposed contrast between naming

and mere specification as a "distinction[ ] without a differ-

ence"). We take up each of the three factors in turn.

To begin with, s 274's restrictions are nothing like the

classic attainders known to the framers. As mentioned

above, bills of attainder at common law generally entailed

execution, although this was typically coupled with other

punishments, such as "corruption of blood," which prevented

__________

6 See also Plaut v. Spendthrift Farm, Inc., 514 U.S. 211, 239 n.9

(1995) ("[L]aws that impose a duty or liability upon a single

individual or firm are not on that account invalid--or else we would

not have the extensive jurisprudence that we do concerning the Bill

of Attainder Clause, including cases which say that it requires not

merely 'singling out' but also punishment, see, e.g., United States v.

Lovett, 328 U.S. 303, 315-18 (1946), and a case which says that

Congress may legislate 'a legitimate class of one,' Nixon v. Admin-

istrator of General Services, 433 U.S. 425, 472 (1977).")

the attainted party's heirs from inheriting his property. See

Brown, 381 U.S. at 441. Bills of pains and penalties, also

forbidden by the clause, "commonly imposed imprisonment,

banishment, and the punitive confiscation of property." Se-

lective Service System, 468 U.S. at 852.

The case becomes closer when we move from historic

antecedents to burdens later found by the Supreme Court to

rank as punishments, which have included "legislative bars to

participation by individuals or groups in specific employments

or professions." Id. at 852. Indeed, the Court's four major

decisions invalidating statutes on Bill of Attainder Clause

grounds have all involved legislation preventing specific

classes of persons from pursuing certain occupations. Those

four cases came in two pairs. The first pair involved restric-

tions imposed immediately after the Civil War on those who

had sided with the South, see Cummings (striking down

amendments to Missouri constitution denying right to vote,

hold office, teach, or serve as trustee for religious organiza-

tion to persons who aided or sympathized with the Confedera-

cy), and Garland (striking down federal law requiring attor-

neys to swear oath that they had never assisted Confederacy

as condition of admission to practice in federal courts).7 The

second pair involved restrictions on Communist Party mem-

bers during the Cold War, see Lovett (invalidating law cutting

off payment of salaries to three named federal employees who

were Party members), and Brown (invalidating law making it

a crime for members of Party to serve as officers or employ-

ees of labor unions).

Although a statute imposing structural separations on cor-

porations seeking to engage in specific types of commercial

activity may be analogous to such traditional employment

debarments, the analogy is very loose indeed. Even if we

ignore the BOCs' freedom under s 274 to enter electronic

publishing through structurally separated affiliates, the sec-

tion is nothing more than a line-of-business restriction, com-

__________

7 See also Pierce v. Carskadon, 83 U.S. (16 Wall.) 234 (1872)

(memorandum opinion striking down West Virginia loyalty oath

similar to those invalidated in Cummings and Garland).

parable for example to the Glass-Steagall Act's limitation on

the entry of commercial banks into investment banking, 12

U.S.C. ss 24 (Seventh), 78, or to the cross-ownership restric-

tions on broadcasters upheld in FCC v. National Citizens

Committee for Broadcasting, 436 U.S. 775 (1978). Although

membership in the class of commercial banks or broadcasting

firms is easy enough to ascertain, no one has suggested that

those laws work an unconstitutional attainder. Indeed the

Supreme Court in Brown strongly suggested that line-of-

business restrictions pose no bill of attainder concerns, distin-

guishing the statute at issue there, which barred Communists

from high office in labor unions, from s 32 of the Banking Act

of 1933 (now codified at 12 U.S.C. s 78), a conflict-of-interest

statute preventing employees of securities underwriting firms

from working for banks that belong to the Federal Reserve

System. Brown, 381 U.S. at 453-55; see also Board of

Governors v. Agnew, 329 U.S. 441 (1947) (upholding s 32 of

Banking Act, though without addressing bill of attainder

issue). Brown reasoned that each of the invalidated employ-

ment prohibitions "inflict[ed] its deprivation upon the mem-

bers of a political group thought to present a threat to the

national security," 381 U.S. at 453, and further contrasted the

conflict-of-interest statute as "incorporat[ing] no judgment

censuring or condemning any man or group of men." Id. at

453-54. It is apparent--and will be more so when we exam-

ine legislative purpose--that s 274 falls on the nonpunitive

side of those lines.

Placing s 274 among the burdens historically forbidden as

attainders seems especially dubious because it does not bar

the BOCs from electronic publishing but simply requires

structural separation. As counsel for BellSouth acknowl-

edged at oral argument, the separated affiliate mechanism

permits his client to establish a wholly-owned subsidiary to

pursue electronic publishing. This subsidiary could dissemi-

nate materials over the telephone lines of BellSouth's BOC

subsidiaries, as long as it was kept separate from them in the

ways prescribed by s 274(b). Indeed, BellSouth itself could

enter the electronic publishing business provided it observed

the norms of separation from its BOCs. In short, s 274

leaves all the investors with stakes in the BOCs (i.e., the

shareholders of the RBOCs) free to pursue their collective

electronic publishing ends, and to aggregate their capital to

achieve those ends, subject only to structural separation

requirements. While structural separation is hardly costless,

neither does it remotely approach the disabilities that have

traditionally marked forbidden attainders.

The second criterion asks whether the challenged legisla-

tion, considering the type and severity of the burdens it

imposes, can reasonably be said to further nonpunitive legis-

lative purposes. This factor appears to be the most impor-

tant of the three. See Siegel v. Lyng, 851 F.2d 412, 418 (D.C.

Cir. 1988) ("The line of Supreme Court law on the Bill of

Attainder Clause indicates that legislation will survive Bill of

Attainder attack if the statute furthers nonpunitive legislative

purposes."). On the one hand, where an enactment falls

outside the historical definition of punishment, the second

factor prevents Congress from circumventing the clause by

cooking up newfangled ways to punish disfavored individuals

or groups. Selective Service System, 468 U.S. at 853-54. On

the other hand, "[e]ven measures historically associated with

punishment--such as permanent exclusion from an occupa-

tion--have been otherwise regarded when the nonpunitive

aims of an apparently prophylactic measure have seemed

sufficiently clear and convincing." Laurence H. Tribe, Amer-

ican Constitutional Law, s 10-5, at 655 (2d ed. 1988).

In fact, apart from its specific targeting aspect, we find that

s 274 has the earmarks of a rather conventional response to

commonly perceived risks of anticompetitive behavior. We

have long recognized that structural separation is "a permissi-

ble regulatory tool" for ensuring "that no cross-subsidization

or unfair competitive practices occur." Computer and Com-

munications Industry Ass'n v. FCC, 693 F.2d 198, 219 (D.C.

Cir. 1982). We return shortly to the realism of those risks,

but pause here to note that BellSouth's claim of punitive

purpose is somewhat undermined by s 274's placement in an

Act that as a whole relieves the BOCs of several of the

burdens imposed by the MFJ, particularly by prescribing in

s 271 a method whereby the BOCs can achieve a long-sought-

after presence in the long-distance market.8

BellSouth advances two arguments in support of its claim

that Congress cannot reasonably be said to have enacted

s 274 for nonpunitive purposes. First, it says the court's

1991 removal of the information services prohibition from the

MFJ--based on a finding that its removal could reasonably

be found to advance the public interest (balancing the risk of

BOC discrimination against competing information services

ventures with the competitive benefits of BOC entry)--shows

that Congress in 1996 had no plausible economic basis for

reimposing electronic publishing restrictions. Second, Bell-

South points to other local exchange carriers who are not

covered by s 274's proscriptions. To the extent the BOCs

pose any anticompetitive threat, says BellSouth, then so do

the excluded firms, and their exclusion demonstrates that

Congress's real aim was to punish the BOCs.

As we said earlier, the information services ban was lifted

from the MFJ at the behest of the Department of Justice,

which had insisted on the ban when the MFJ was being

negotiated. Circumstances had changed, the government

argued; the information services market had become more

competitive, and the BOCs' ability to discriminate and cross-

subsidize had consequently decreased. The district court

initially rejected the government's proposal, United States v.

Western Electric Co., 673 F. Supp. 525, 587-97 (D.D.C. 1987),

but we reversed, saying that the court had used too stringent

a standard to evaluate the government's motion, which no

party to the consent decree had opposed. United States v.

Western Electric Co., 900 F.2d 283, 292 (D.C. Cir. 1990). On

remand the district court lifted the information services ban.

United States v. Western Electric Co., 767 F. Supp. 308

(D.D.C. 1991). We affirmed, noting that under the applicable

__________

8 Because we find no attainder, we need not wrestle with the issue

of remedy. Severability is largely a matter of legislative intent, and

it is doubtful that Congress would have intended the many provi-

sions of the Act beneficial to the BOCs to survive deletion of this

burdensome one.

"public interest" standard "the record before the court was

such that any district court rejection of the proposed modifi-

cation would have been reversible error." United States v.

Western Electric Co., 993 F.2d 1572, 1577-78 (D.C. Cir. 1993).

That record, we said, contained "persuasive evidence that,

despite their local monopoly power, the BOCs will be unable

to discriminate against competing information service provid-

ers." Id. at 1579-80. We also concluded that there was

powerful evidence to counter any suggestion that the BOCs

would be able to use their price-regulated monopolies to

subsidize their entry into information services. Id. at 1580-

81.

Obviously Congress's reading of the evidence in 1996 was

different from the one arrived at by the Department of

Justice in 1987--or by this court in 1993 for that matter. It

does not follow from these conflicts between branches, howev-

er, that Congress cannot rationally be said to have pursued

nonpunitive purposes in enacting s 274. Certainly our trien-

nial review decisions never suggested that the risks of anti-

competitive conduct were so feeble that no one could reason-

ably assert them except as a smokescreen for some invidious

purpose (much less for the specific invidious purpose of

"punishing" the BOCs). And we note that s 274 is less

severe than the analogous pre-1991 MFJ provision along

several dimensions: it applies only to electronic publishing

rather than to information services as a whole, it expires after

five years rather than continuing indefinitely, and it mandates

structural separation rather than complete exclusion.

BellSouth complains that this reading of the second factor

reduces it to little more than a rational basis test, the most

anemic form of constitutional scrutiny. If this were strictly

true, of course, the Bill of Attainder Clause (as applied to

non-suspect classes such as the BOCs) would do nothing more

than duplicate the Equal Protection Clause. But the Su-

preme Court's attainder inquiry is in fact more exacting than

a rational basis test, because it demands purposes that are

not merely reasonable but nonpunitive. Punitive purposes,

however rational, don't count.

BellSouth's second argument focuses on the fact that s 271

does not cover several large non-BOC local exchange carriers,

in particular GTE Corporation.9 GTE, which was never part

of the AT&T system, supplies about 18.4 million access lines

in 27 states; by comparison, BellSouth supplies about 24.5

million access lines in nine states. 1996 FCC Statistics of

Communications Common Carriers 21 (1997). Although its

operations are generally rural, as of 1993 "GTE control[led]

local exchange service in the entire state of Hawaii as well as

in large portions of the Tampa and Los Angeles markets."

United States v. Western Electric Co., 993 F.2d at 1579.

Other non-BOC carriers, such as Southern New England

Telephone with about 2.1 million access lines in Connecticut,

are also not covered by s 274. 1996 FCC Statistics of

Communications Common Carriers 21 (1997). From this

selectivity--which BellSouth labels underinclusiveness--Bell-

South would have us draw an inference of punitive purpose.

But the differential treatment of the BOCs and non-BOCs

is neither suggestive of punitive purpose nor particularly

suspicious. Because the BOCs' facilities are generally less

dispersed than GTE's, they can exercise bottleneck control

over both ends of a telephone call in a higher fraction of cases

than can GTE. The BOCs thus enjoy a materially greater

opportunity to shift costs from their electronic publishing

pursuits to their rate-regulated local exchange ventures.10 In

__________

9 Like the BOCs, GTE was subject to a consent decree for more

than a decade, until the passage of the Act. The decree, however,

permitted GTE to provide information services, subject to structur-

al separation and non-discrimination requirements. See United

States v. GTE Corp., 603 F. Supp. 730, 742 (D.D.C. 1984).

10 While in 1993 we somewhat disparaged the distinction then

drawn between GTE and the BOCs on the basis of relative disper-

sion, United States v. Western Electric Co., 993 F.2d at 1579, we did

so solely with respect to the claim of discrimination against compet-

ing providers. Our reasoning was that the BOCs could not easily

sort out information services transmissions, or intra-corporate

transmissions, on the customer end of a call, as they would have to

do in order to discriminate efficiently. Id. That deficiency would

not seem to impede cost-shifting, where the regulated monopoly

addition, because GTE (unlike the BOCs) is not the dominant

provider of local exchange service in any state except Hawaii,

state regulators can use the costs of its local competitors as

benchmarks against which to measure whether it is engaging

in improper cost allocation. Thus the distinction drawn by

Congress seems quite understandable without resort to infer-

ences of punitive purpose.

The third device for identifying a punishment focuses on

legislative intent, and in practice appears to differ from the

second only in inviting a journey through legislative history.

On this point we can be brief. BellSouth simply has not come

forward with the kind of "unmistakable evidence of punitive

intent which ... is required before a Congressional enact-

ment of this kind may be struck down" as an attainder.

Selective Service System, 468 U.S. at 855-56 n.15 (quoting

Flemming v. Nestor, 363 U.S. 603, 619 (1960)). Aside from a

few scattered remarks referring to anticompetitive abuses

allegedly committed by the BOCs in the past, BellSouth has

provided no legislative history even touching on the purposes

behind s 274, much less presenting "smoking gun" evidence

of congressional vindictiveness.

In sum, we hold that s 274 is not a bill of attainder.

First Amendment Challenge

BellSouth complains that s 274 abridges its constitutional

right of free speech by restricting its ability to provide

electronic publishing. Clearly the structural separation re-

quirements regulate expressive activity within the scope of

the First Amendment. So, as is often the case in the First

Amendment arena, the parties devote much of their energy

toward disputing the appropriate standard of review. Bell-

South argues that s 274 warrants strict scrutiny for two

reasons: first, because it singles out named corporations for

speech restrictions, and second, because it is content-based.

The FCC says that s 274 is a content-neutral regulation and

__________

attempts to deceive regulators about which costs belong in the

regulated enterprise and which in the other.

should instead be evaluated under the intermediate standard

of review applied by the Supreme Court in its decisions

upholding the cable television "must-carry" rules. See Tur-

ner Broadcasting System, Inc. v. FCC, 512 U.S. 622 (1994)

("Turner I") (determining that intermediate scrutiny applied);

Turner Broadcasting System, Inc. v. FCC, 117 S. Ct. 1186

(1997) ("Turner II") (upholding must-carry provisions under

intermediate scrutiny). We agree with the FCC that an

intermediate level of scrutiny is appropriate.

We begin with BellSouth's claim that s 274 warrants strict

First Amendment review because it targets named corpora-

tions. In support of this claim BellSouth cites our decision in

News America Publishing, Inc. v. FCC, 844 F.2d 800 (D.C.

Cir. 1988). That case concerned a provision that prohibited

the FCC from granting extensions of temporary waivers of

the newspaper/television cross-ownership rules to all then-

current holders of such temporary waivers--a class of one, as

it turned out. We struck down the provision on First Amend-

ment and equal protection grounds, noting that "[w]here

legislation affecting speech appears underinclusive, i.e., where

it singles out some conduct for adverse treatment, and leaves

untouched conduct that seems indistinguishable in terms of

the law's ostensible purpose, the omission is bound to raise a

suspicion that the law's true target is the message." Id. at

804-05. Contrary to BellSouth's assertion, however, News

America does not stand for the proposition that statutes

singling out particular persons for speech restrictions auto-

matically merit strict scrutiny. In fact we chose among

standards only to the extent of saying that the provision could

not survive any standard of review more exacting than a

rational basis test. Id. at 802, 814.

Only marginally more promising for BellSouth are the

Supreme Court's decisions in Minneapolis Star & Tribune

Co. v. Minnesota Commissioner of Revenue, 460 U.S. 575

(1983), and Arkansas Writers' Project v. Ragland, 481 U.S.

221 (1987). In both cases the Court applied strict scrutiny to

invalidate state tax laws that had the effect of disproportion-

ately burdening certain segments of the press. In Minne-

apolis Star, because the challenged use tax exempted the

first $100,000 in ink and paper consumed by a publication in a

given year, its burden was borne by fewer than one in twenty

newspapers in the state, with two-thirds of it landing on one

publisher alone. 460 U.S. at 578-79. The sales tax struck

down in Arkansas Writers' Project appeared to spread its net

more broadly, covering general interest magazines but ex-

empting newspapers and religious, professional, trade, and

sports magazines. 481 U.S. at 224. In fact, however, "the

magazine exemption mean[t] that only a few Arkansas maga-

zines pa[id] any sales tax," giving the tax a targeting effect

comparable to that of the Minneapolis Star tax. Id. at 229.

The Supreme Court has explained the two cases as meaning

only that strict scrutiny must be applied to regulations that

target a small subset of media organizations in ways that

threaten to "distort the market for ideas." Turner I, 512

U.S. at 660 (quoting Leathers v. Medlock, 499 U.S. 439, 448

(1991)). The Court has expressly declined to draw the broad

lesson "that the First Amendment mandates strict scrutiny

for any speech regulation that applies to one medium (or a

subset thereof) but not others." Turner I, 512 U.S. at 660.11

News America, Minneapolis Star, and Arkansas Writers'

Project all featured some suggestion that the legislature's

differential treatment of speakers was motivated by the con-

tent of their speech. See Turner I, 512 U.S. at 660 ("Al-

though there was no evidence that an illicit governmental

motive was behind either of the taxes, both were structured

in a manner that raised suspicions that their objective was, in

fact, the suppression of certain ideas.").12 It is that sugges-

tion, rather than the act of "singling out" by itself, that

triggers strict First Amendment scrutiny, as Turner I made

clear. See id. at 658 ("[S]peaker-based laws demand strict

__________

11 In a similar vein, we have described Minneapolis Star and

Arkansas Writers' Project as "likely addressed only to the special

complexities of taxation." Walsh v. Brady, 927 F.2d 1229, 1236

(D.C. Cir. 1991).

12 In fact, the tax exemption challenged in Arkansas Writers'

Project facially excluded certain publications on the basis of their

content, rendering it especially suspect. 481 U.S. at 229-30.

scrutiny when they reflect the Government's preference for

the substance of what the favored speakers have to say (or

aversion to what the disfavored speakers have to say).").

Here, there is no indication that s 274's coverage was

limited to the BOCs because of any concern about the content

of their speech--no indication, in other words, that "the

legislature's speaker preference reflects a content prefer-

ence." Id. "So long as they are not a subtle means of

exercising a content preference, speaker distinctions of this

nature are not presumed invalid under the First Amend-

ment." Id. at 645. In addition, Turner I held that "height-

ened scrutiny is unwarranted when the differential treatment

is 'justified by some special characteristic of' the particular

medium being regulated." Id. at 660-61 (quoting Minne-

apolis Star, 460 U.S. at 575). Congress's imposition of

structural separation on the BOCs because of their status as

price-regulated bottleneck monopolies is certainly no more

suggestive of any effort to exercise a content preference than

were the must-carry provisions upheld in Turner, see Turner

I, 512 U.S. at 661 (identifying "bottleneck monopoly power"

held by cable operators as a special characteristic of the cable

medium).

We turn next to BellSouth's claim that s 274 is expressly

formulated in terms of content, and thus requires strict

scrutiny. To be sure, s 274 defines the field of expression to

which it applies by reference to a set of categories that might

in a formal sense be described as content-based. Thus it

covers items such as "news," "entertainment," and "research

material," and exempts information such as "video program-

ming," "voice messaging," and "data processing." See

s 274(h)(1).

Nothing about the provision, however, suggests an underly-

ing purpose to favor or disfavor particular viewpoints, nor

does BellSouth advance such a suggestion. The Supreme

Court has held that statutes lacking such a purpose are likely

to be deemed content-neutral. "[L]aws that confer benefits

or impose burdens on speech without reference to the ideas

or views expressed are in most instances content-neutral."

Turner I, 512 U.S. at 643. Indeed the very breadth of

s 274's categories undermines any claim that Congress

adopted a categorical approach out of a desire to favor any

particular viewpoint or idea. Further, to a large extent

neutrality is now gauged by reference to a statute's justifica-

tions: "Government regulation of expressive activity is con-

tent neutral so long as it is justified without reference to the

content of the regulated speech." Ward v. Rock Against

Racism, 491 U.S. 781, 791 (1989) (emphasis in original) (cita-

tion omitted). The goal of remedying bottleneck problems is

independent of content and viewpoint.

In summary, then--despite BellSouth's twin contentions

that s 274 favors certain speakers, and certain types of

speech, over others--we hold that intermediate scrutiny is

appropriate because here, perhaps even more than in Turner,

there is simply no hint that "the government has adopted a

regulation of speech because of [agreement or] disagreement

with the message it conveys." Turner I, 512 U.S. at 642

(quoting Ward, 491 U.S. at 791).

A regulation will be upheld under intermediate scrutiny "if

it advances important governmental interests unrelated to the

suppression of free speech and does not burden substantially

more speech than necessary to further those interests." Tur-

ner II, 117 S. Ct. at 1186 (citing United States v. O'Brien, 391

U.S. 367, 377 (1968)). The requirement of an important

governmental interest is amply met here. The asserted

interest underlying s 274 is to promote competition by dis-

couraging discrimination and cross-subsidization by the

BOCs. This is not only important, see Turner I, 512 U.S. at

644, but "unrelated to the suppression of free speech"; in-

deed, the interest in preventing truly anticompetitive behav-

ior in the electronic publishing marketplace is an interest in

the enhancement of speech. Cf. id. at 663.

Under intermediate scrutiny, while the government obvi-

ously need not meet the most rigorous standard of "narrow

tailoring," it must nonetheless "demonstrate that the recited

harms are real, not merely conjectural, and that the regula-

tion will in fact alleviate these harms in a direct and material

way." Id. at 664. In determining whether the government

has made this showing, we owe Congress's economic judg-

ments considerable deference, so as not to "infringe on tradi-

tional legislative authority to make predictive judgments

when enacting nationwide regulatory policy." Turner II, 117

S. Ct. at 1189; see also id. at 1203-05 (Breyer, J., concurring)

(deferring to Congress's non-economic objectives). Aside

from noting the various executive branch (and judicial) posi-

tions taken in connection with removal of the MFJ's restric-

tion, which bear no more weight here than in the bill of

attainder analysis, see pp. 11-12 above, BellSouth does not

claim that Congress's apparent concern about anticompetitive

risks was unreasonable.

But it does complain that Congress could have guarded

against these risks through less speech-restrictive methods,

for instance by imposing non-structural safeguards such as

accounting requirements. Intermediate First Amendment

scrutiny, however, does not entail a "least restrictive means"

analysis. See Turner II, 117 S. Ct. at 1199-1200. It is at

least plausible that structural separation will more effectively

meet the perceived anticompetitive threat than would lesser

restrictions, and although BellSouth characterizes the addi-

tional burden of structural separation as "enormous" (com-

pared with, for example, special accounting rules), it offers

neither detail nor quantitative evidence to support this char-

acterization.

As in its bill of attainder attack, BellSouth points to the

exclusion of GTE and other non-BOC local exchange carriers.

But as we said in that connection, there are plausible reasons

for the exclusion, and, just as BellSouth failed in that context

to suggest a punitive purpose, here it equally fails to suggest

any intent to favor non-BOCs' viewpoints over BOCs'. More-

over, since intermediate scrutiny demands that the govern-

ment "not burden substantially more speech than necessary

to further [its] interests," Turner II, 117 S. Ct at 1186, it

would be odd to strike down a statute because Congress

failed to restrict as much expression as it could have--

presumably because of a judgment that the interest justifying

a restriction in one context, though "important," was slightly

less so than in the other and therefore, at the margin,

outweighed by competing interests (including free speech).

See Walsh v. Brady, 927 F.2d 1229, 1238-39 (D.C. Cir. 1991)

(Williams, J., concurring).

Finally, we note again that s 274 leaves each RBOC free to

publish electronically, using the facilities of its BOC subsidiar-

ies, either directly or through a subsidiary, so long as the

acting corporation conforms to the statutory separation re-

quirements. BellSouth argues that the separated affiliate

mechanism is entirely irrelevant to the First Amendment

question, since "[i]t hardly answers one person's objection to

a restriction on his speech that another person, outside his

control, may speak for him." Arkansas Writers' Project, 481

U.S. at 231 (internal quotations omitted). While undoubtedly

true in the context of natural persons, this observation carries

less weight in the context of controlled subsidiaries. The

First Amendment does not normally permit the government

to justify a prohibition on a corporation's speech by pointing

to the fact that its shareholders remain free to express

themselves without restriction; corporations exist in signifi-

cant part to overcome precisely the sorts of collective action

problems that the shareholders in that scenario would then

face. But there is no collective action problem here. The

investors in BellSouth are free to use whatever portion of

their pooled resources they wish for electronic publishing,

subject only to the need for structural separation. This is not

to say that structural separation requirements count as mere-

ly insubstantial burdens from a First Amendment perspec-

tive--they do not. Cf., e.g., FEC v. Massachusetts Citizens

for Life, 479 U.S. 238, 252-54 (1986) (noting disclosure and

record-keeping requirements entailed by corporation's use of

segregated political contribution fund). But the fact that

s 274 leaves RBOCs like BellSouth free to pursue electronic

publishing strengthens our conclusion that s 274 does not

restrict substantially more speech than necessary.

* * *

The petition for review is

Denied.

Sentelle, Circuit Judge, dissenting: With respect to the

First Amendment argument of the Bell operating companies

("BOCs"), I agree with the majority's analysis and with its

conclusion. With respect to the bill of attainder claim, how-

ever, I agree with most of the majority's analysis; I simply

conclude that it does not support the majority's conclusion.

The majority opinion sets forth the provisions of 47 U.S.C.

s 274, and I will not rehash them here, beyond a brief

summary to set the stage for my dissent. That section

prohibits Bell operating companies, by name, and their affili-

ates, from engaging in the provision of a lucrative line of

business on the same terms as competitors, potential competi-

tors, or anyone else in the world. BellSouth argues that this

provision constitutes legislative punishment for their past

course of business conduct, and as such, runs afoul of Article

I, section 9, clause 3 of the Constitution, which provides that,

"No Bill of Attainder or ex post facto law shall be passed."

As the majority notes, while the term "Bill of Attainder"

may have originally referred to parliamentary acts sentencing

persons to death without a trial by the judiciary, Maj. Op. at

7, the Supreme Court early held that the prohibition extends

to legislative punishment of specified persons beyond capital

punishment. Fletcher v. Peck, 10 U.S. (6 Cranch) 87 (1810).

As the majority further notes, the court has developed a

clearly identifiable bill-of-attainder jurisprudence under which

"legislative acts, no matter what their form, that apply either

to named individuals or to easily ascertainable members of a

group in such a way as to inflict punishment on them without

a judicial trial are bills of attainder prohibited by the Consti-

tution." United States v. Lovett, 328 U.S. 303, 315-16 (1946).

As the majority reasons, the result of this progressive revela-

tion of jurisprudence is that the prohibition against bills of

attainder is "triggered when a legislative act meets two

tests--first, that it apply with specificity, and second, that it

impose punishment." Maj. Op. at 7. I completely agree.

What I do not understand about the majority opinion is why,

having fully loaded its analysis with specificity and punish-

ment, the majority is unable to pull the trigger in this case.

On its face, the legislation before us appears to fall square-

ly on the condemned side of this two-part test. Section 274

exhibits nearly unprecedented specificity, forbidding twenty

named corporations, alone out of over 1,300 local exchange

carriers, from entering a trade or business on the same terms

as others. Of all the bill of attainder cases decided by the

Supreme Court, in only one did a statute single out individu-

als by name, and that was deemed an unconstitutional bill of

attainder. See Lovett, 328 U.S. 303. And, as the Supreme

Court has held, "legislative bars to participation by individu-

als or groups in specific employments or professions" do

indeed constitute punishment within the meaning of this test.

Selective Service System v. Minnesota Public Interest Re-

search Group, 468 U.S. 841, 852 (1984). Absent the Supreme

Court's decision in Nixon v. Administrator of General Ser-

vices, 433 U.S. 425 (1977), I think we would rule this an

unconstitutional bill of attainder without going further.

Mere specificity may not make an act a bill of attainder,

but in most cases the Court has required little more. The

Court has described the Bill of Attainder Clause as the

embodiment of a fundamental principle of separation of pow-

ers: "a legislature can provide that persons possessing cer-

tain characteristics must abstain from certain activities, but

must leave to other tribunals the task of deciding who pos-

sesses those characteristics." United States v. Brown, 381

U.S. 437, 454 n.29 (1965). But Nixon precludes defining a bill

of attainder solely in terms of its specificity. In that case,

Congress acted against a single, named individual for disfa-

vored treatment as compared to "all other Presidents or

members of the Government." 433 U.S. at 470. After a

herculean struggle, the Court concluded that the statute

could be upheld because "appellant constituted a legitimate

class of one...." Id. at 472. The majority upholding that

statute included Justice Stevens, who noted in his separate

concurrence that "[t]he very specificity of the statute would

mark it as punishment, for there is rarely any valid reason for

such narrow legislation; and normally the Constitution re-

quires Congress to proceed by general rulemaking rather

than by deciding individual cases." Id. at 485-86 (Stevens, J.,

concurring). Just so. And absent that Nixon decision, the

theory advanced by Brown and echoed by Justice Stevens

would in my view be an adequate basis for striking down the

present legislation.

Nixon, of course, is a unique case. It involved a disgraced

President of the United States who had, as Justice Stevens

pointed out, "resigned his office under unique circumstances

and accepted a pardon for any offenses committed while in

office," thereby "plac[ing] himself in a different class from all

other Presidents." Id. at 486. Despite my respect for the

Supreme Court, I must say that this case may well be

evidence of the classic statement that hard cases make bad

law. The majority circumvented the apparent status of the

statute, singling out one President by name, with an uncon-

vincing analysis holding that the burden placed upon him was

not a punishment. Chief Justice Burger's dissent, 433 U.S. at

536-45, noted the anomalous character of the decision legiti-

mating a " 'class of one' ... under the Bill of Attainder

Clause." Id. at 545. Without that decision, the analysis

suggested by Justice Stevens would impel if not compel a

decision that the statute before us runs afoul of that clause.

The legislative imposition of a burden solely on a class of

individuals defined by name rather than by characteristic

(although not a class of one as in the case of Nixon) on its

face bespeaks an intent to punish rather than to merely

regulate. But still, the Nixon decision is a Supreme Court

decision, and whether a good one or a bad one, it binds us.

Because of that decision, and its convoluted analysis holding

nonpunitive the unprecedented burdening of a "class of one,"

we must undertake a more careful analysis of "punishment"

under the three-part test of Selective Service System, 468

U.S. 841.

In what appears to have been an attempt to cabin its

reasoning in Nixon, the Court in Selective Service System

announced a three-part test to determine whether a statute

imposes "punishment" for purposes of the Bill of Attainder

Clause:

(1) whether the challenged statute falls within the histor-

ical meaning of legislative punishment; (2) whether the

statute, viewed in terms of the type and severity of

burdens imposed, reasonably can be said to further

nonpunitive legislative purposes; and (3) whether the

legislative record evinces a congressional intent to pun-

ish.

Id. at 852 (internal punctuation omitted). This test leads inexorably

to a conclusion that the statute before us is a bill of attainder.

As to the first part of the test, even the majority must

recognize that "legislative bars to participation by individuals

or groups in specific employments or professions," id., have

constituted the most common sort of statutes struck down by

the Court as unconstitutional bills of attainder. Nixon simply

does not change this fact. The Court in Nixon distinguished

the statute before it as nonpunitive--not only did the statute

fail to inflict any harm previously held to be "forbidden

deprivations," but its provision for " 'just compensation' ...

undercut[ ] even a colorable contention that the Government

has punitively confiscated appellant's property...." 433 U.S.

at 475. Here, given the history of treating line-of-business

restrictions as punishment, such an easy escape is not avail-

able.

Under Selective Service, we probably need go no further;

nevertheless, analysis under the additional parts of that test

support the conclusion that this statute is unconstitutional.

The second prong asks "whether the statute, viewed in terms

of the type and severity of burdens imposed, reasonably can

be said to further nonpunitive legislative purposes." 468 U.S.

at 852 (internal punctuation omitted). In my view, it cannot.

The majority concludes that it can, stating: "apart from its

specific targeting aspect, we find that s 274 has the earmarks

of a rather conventional response to commonly perceived

risks of anticompetitive behavior." Maj. Op. at 13. While

the latter portion of this statement may be true, I do not see

how we can analyze the statute in terms "apart from its

specific targeting aspect." The statute does not address the

characteristics of local exchange carriers that create risks of

anticompetitive behavior. If it did, it would speak of those

characteristics, which might well be shared by, for example,

GTE or Sprint. See Illinois Bell Tel. Co. v. FCC, 740 F.2d

465, 476 (7th Cir. 1984) (noting that even small LECs may

have the "ability to abuse a monopoly position"). Then,

whether or not a particular carrier possessed the relevant

characteristics and therefore should be restricted would be

subject to judicial determination. By naming the companies

rather than describing the characteristics creating the risks,

it seems apparent that Congress aimed, not at protecting

present and future markets from potential abuse of monopoly

power, but at punishing those named companies' past anti-

competitive behavior. I agree with today's majority that the

second factor "appears to be the most important of the

three." Maj. Op. at 13. I cannot, however, agree with the

majority that it cuts against the characterization of section

274 as a bill of attainder.

I further conclude that the third factor, which I deem the

least important, also supports classifying the statute as a bill

of attainder. That factor requires us to examine "whether

the legislative record evinces a congressional intent to pun-

ish." Selective Service, 468 U.S. at 852 (internal punctuation

omitted). In my view it does. As the majority notes, "scat-

tered remarks" in the legislative history "refer[ ] to anticom-

petitive abuses allegedly committed by the BOCs in the

past...." Maj. Op. at 17. While I find the very existence of

the scattered remarks to be indicative of the punitive intent

behind the statute, I do not find them conclusive. We have

noted before that "[a]t its best, legislative history is an

undependable guide to the meaning of a statute." Gersman

v. Group Health Ass'n, Inc., 975 F.2d 886, 890 (D.C. Cir.

1992). I suggest that it is no more dependable in ascertain-

ing the motive behind the statute.

More instructive on congressional motivation than the scat-

tered remarks is the timing and apparent triggering of the

enactment. As the majority notes in its discussion of factor

two, Congress passed section 274 after the judiciary removed

the information services prohibition from the modified final

judgment. Maj. Op. at 14-15. The reinstatement of that ban

following its judicial removal to me bespeaks, indeed shouts, a

motive on the part of the Article I branch to reimpose a

burden on the parties before the court which the Article III

branch found no longer appropriate. While I have no quarrel

with the legitimacy of a congressional motive to correct what

it sees as an improper application of legal protection against

future conduct, when Congress defined the burdened class by

name rather than by characteristic or future action, I can

discern no other motive than an intent to react to (read

"punish") the past conduct of those named persons. This, I

suggest, violates the principle underlying Article I, section 9,

clause 3, given short shrift by the majority.

That is, the prohibition against bills of attainder and ex

post facto laws is an essential part of the Constitution's

structural separation of powers among the three branches of

government. As the majority's analysis suggests, that clause

was designed to prevent punishment "without the benefit of a

judicial trial." Maj. Op. at 7. By way of comparison, in

Plaut v. Spendthrift Farm, Inc., 514 U.S. 211 (1995), the

Supreme Court struck down as unconstitutional a congres-

sional enactment "to the extent that it require[d] federal

courts to reopen final judgments entered before its enact-

ment." Id. at 240. While the statute before us does not

literally run afoul of that prohibition, it partakes of the same

sort of violation of separation of powers safeguards. That is,

it does not simply regulate or prohibit future conduct or

create a ban on the entry into a line of business based on

risks of future anticompetitive behavior, but rather, it singles

out for such a ban, such a burden, named entities. It is one

thing for the legislature to attempt to protect competition by

defining a standard against which the conduct of individuals

can be measured. It is quite another for it to simply list the

names of individuals who Congress perceives as having un-

controllable monopolistic tendencies. This short-circuits the

factfinding and due process protections of trial in an Article

III court, and therefore runs afoul of the structural provisions

embodied in the Constitution's Bill of Attainder Clause.

I would say in closing that the majority's discussion of the

lightness of the burden, typified by the ways in which a BOC

might restructure in order to get around it, goes only to the

weight of the punishment, not its character as punishment.

Thus, that part of the majority's reasoning does nothing to

convince me that the statute can survive constitutional scruti-

ny.