Petition — Capital Cities Cable, Inc. v. Crisp

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Office-Sunreme Court, U.S.

rites

82-1795 MAY 3 1993

No.

IN THE

Supreme Court of the Wuited States

OCTOBER TERM, 1982

CAPITAL CITIES CABLE, INC.; CoX CABLE OF

OKLAHOMA CITY, INC.; MULTIMEDIA CABLEVISION, INC.;

AND SAMMONS COMMUNICATIONS, INC.,

: Petitioners,

RICHARD A. CRISP, DIRECTOR,

OKLAHOMA ALCOHOLIC BEVERAGE CONTROL BOARD,

Respondent,

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE TENTH CIRCUIT

Of Counsel: TIMOTHY B. Dyk *

JOHN W. ZUCKER

WILMER, CUTLER & PICKERING

1666 Kk Street, N.W,

Washington, D.C. 20006

(202) 872-6000

CLYDE A. MUCHMORE

CROWE & DUNLEVY

1800 Mid-America Tower

20 North Broadway

Oklahoma City, OK 73102

Counsel for Petitioner

Capital Cities Cable, Inc.

JOHN D. MATTHEWS *

DAVID P. FLEMING

J. CHRISTOPHER REDDING

Dow, LOHNES & ALBERTSON

1225 Connecticut Ave., N.W.

Washington, D.C. 20036

(202) 862-8079

Counsel for Petitioners Cox

Cable of Oklahoma City, Inc.;

Multimedia Cablevision, Inc.:

and Sammons Communica-

tions, Ine.

May 3, 1983 * Counsel of Record

WILSON - EPES PRINTING Co., INC. - 789-0096 - WASHINGTON, D.C. 20001

QUESTIONS PRESENTED

1. Whether a State, consistent with the protection of

commercial speech under the First and Fourteenth

Amendments, may adopt a sweeping ban on truthful,

non-misleading advertising for a lawful product.

2. Whether a State, consistent with the First and

Fourteenth Amendments, may prevent cable television op-

erators from carrying out-of-state news and entertain-

ment programs because those programs contain truthful,

non-misleading advertising for wine.

- (i)

PARTIES TO THE PROCEEDING BELOW

The following were parties to the proceeding (No. 82-

1061) in the United States Court of Appeals for the

Tenth Circuit: Cablecom-General, Inc. (now Capital

Cities Cable, Inc.), Cox Cable of Oklahoma City, Inc.,

Multimedia Cablevision, Inc., and Sammons Communi-

cations, Inc., appellees, and Richard A. Crisp, Director,

Oklahoma Alcoholic Beverage Control Board, appellant.*

* Petitioners construe the terms “parent companies,” “subsidi-

aries,” and “affiliates” in Rule 28.1 of the Rules of this Court to

mean those corporations (1) the shares of which are publicly

traded; (2) in the case of “parent companies,” which own a ma-

jority of the shares of a party; and (3) in the case of “subsidiaries”

and “affiliates,” a majority of the shares of which are owned by a

party. With the terms so defined, petitioner Capital Cities Cable,

Inc., has a parent company, Capital Cities Communications, Inc..

and no subsidiaries or affiliates; petitioner Multimedia Cablevision,

Inc., has a parent company, Multimedia, Inc., and no subsidiaries

or affiliates; petitioner Cox Cable of Oklahoma City, Inc., has a

parent company, Cox Communications, Inc., and no subsidiaries or

affiliates; and petitioner Sammons Communications, Inc., has no

parent, subsidiaries, or affiliates.

TABLE OF CONTENTS

Page

ee Oe io vo vvcsccinccpsancccdnncanecesnccerace i

PARTIES TO THE PROCEEDING BELOV ............... ii

ee 8 a gS go” SERIES ie Re eee pine iv

OPINIONS BELOW ............... pA) dR eM CONN Oe 1

Os canada eiesee ndescnemns 2

CONSTITUTIONAL PROVISIONS, STATUTES, AND

ee ING PROVO VD connie cnccscseeececeecsc...... yt 2

STATEMENT OF THE CASE ................ Rie biggie 2

Pee CEG FYOCOBCINNS —...c.........-..ccccscese-cecsescnnons- q

Be ss ecsmncbecnecauneeeis 9

REASONS FOR GRANTING THE WRIT ............-00----- 11

I. THE COURT BELOW HAS DECIDED AN

IMPORTANT CONSTITUTIONAL QUESTION

CONCERNING THE PROTECTION OF COM-

MERCIAL SPEECH IN CONFLICT WITH

DECISIONS OF THIS COURT AND CON-

TRARY TO THE OPINION OF ANOTHER

ee ea ms 11

Il. THE COURT BELOW HAS DECIDED AN

IMPORTANT CONSTITUTIONAL QUESTION

CONCERNING THE® PROTECTION OF NON-

COMMERCIAL SPEECH IN CONFLICT

WITH DECISIONS OF THIS COURT ............ 18

CAINCULAMON 2. i mare snes

TABLE OF AUTHORITIES

Cases: Page

Abrams v. United States, 250 U.S. 616 (1919)........ 22

Bates xv. State Bar of Avena, 438 U.S. 350

eee ee 12, 13, 14

Bigelow Vv. Virginia, 421 U.S. 809 (1975) .............. passim

Board of Education v. Pico, 50 U.S.L.W. 4831 (U.S.

ee oe ee 22

EBuckicy o. Valeo, 424 U.S. 1 (1976) _.......... 22

Butler v. Michigan, 352 U.S. 380 (1957) _............... 24

California v. LaRue, 409 U.S. 109 (1972) .............. 15

California Retail Liquor De alors Ass'n v. Midcal

Aluminum, Inc., 445 U.S. 97 (1980) .................... 16

Carey v. Population Services International, 431

Mae ee OP 12, 13

Central Hudson Gas & Electric Corp. v. Public

Service Commission, 447 U.S. 557 (1980) .......... passim

Columbia Broudcasting System, Inc. v. Democratic

National Committee, 412 U.S. 94 (1973) ............ 20, 23

Community Communications Co. v. City of Boulder,

660 F.2d 1370 (10th Cir. 1981), petiton for cert.

dismissed by agreement, 102 S.Ct. 2287 (1982). 21

Cratg wv. Koren, 429 US. 190 (1976) ..................... 5

Dunagin rv. City of Oxford. 701 F.2d 335, reh’q en

banc ordered (5th Cir. March 11, 1983) ........... , 15,18

Bivod v. Burns, 427 US. 347 (1976) rs

Epperson v. Arkansas, 393 U.S. 97 (1968) _.. 22

Griswold v. Connecticut, 381 U.S. 479 (1965)........ 22

Grosjean v. American Press Co., 297 U.S. 233

ORO . 20.35

Home Bor Office. Inc. v. FCC, 567 F.2d 9 (D.C.

Cir.), cert. denied, 434 U.S. 829 (1977) .... 21

Pave Frenus S56 U5. 412 (1978)... 23, 24

Pa ve RAJ... 102 &. Ce 929 (1982)... 12 13, 16

Jamison v. Texas, 318 U.S. 413 (19738) . 23

Joseph Burstyn Ine. v. Wilson, 343 US. 295

Soe 20

Lamar Outdoor Advertising, Inc. v. Missisippi

State Commission, 701 F.2d 314, reh’g en banc

ordered (Sth Cir. March 11, 1988) ..............15, 177,18

TABLE OF AUTHORITIES—Continued

Larkin v. Grendel’s Den, Inc., 51 U.S.L.W. 4025

Se ae i ae

Loui isiana ex rel, Gremillion v’ . NAACP, 366 US.

“293 Re ee.

Moda v. Bradiey, 492 US. 178 (1977)

Martin v. City of Struthers, 319 U.S. 141 (1943).

Metromedia, Inc. v. City of San Diego, 153 U.S. 190

OO 8,

Miami Herald Publishing Co. v. Tornillo, 418 U.S.

eee Cees

Midwest Video Corp. v. FCC, 571 F.2d 1025 (8th

Cir. 1978), aff'd, 440 U.S. 689 (1979)

Minneapolis Star & Tribune Co. v. Minnesota Com-

missioner of Revenue. 51 U.S.L.W. 4315 (US.

mere Sr ee

Murdock v : Femme TaN, 319 U.S. 105 (1948) _.

NAACP v. Alabama, 357 U - aay (i9Ge)

National Scala ac Co, v. FCC, 516 F.2d 1101.

vacated, 516 F.2d 1180 (D.C. Cir. 1974), cert.

denied, 424 U.S. 910 Prete?

New York State Liq luthority v. Bellanca, 452

U.S. 714 (1981), e« ¢. denied, 102 S. Ct.. 2296

eee

New York Times v. Sullivan, 376 U.S. 254 (1964)..

Ohralik v. Ohio State Bar Association, 436 U.

G47 (90a) SOL ONG SEES SMR CeO Par ESA

Oklahoma Alcoholic Beverage Control Board r.

Heublein Wines, 566 P.2d 1158 (Okla. 1977) _.

Pittsburgh Press Co. v. Pittsburgh Commission on

Human Relations, 413 U.S. 876 (1973)

Queensgate Investment Co. v. Liquor Control Com-

mission, 133 N.E.2d 138 (Ohio). appeal dis-

missed, 103 S. Ct. 31 (1982) ..... AE Rn NS

Queensgate Investment Co, v. Liquor Control Com.

mission, 103 S. Ct. 31 figees a. 10,

Saia v. New York, 334 U.S. 558 (1948)

Schneider v. State, 308 U.S. 147 (ieee)

14,

TABLE OF AUTHORITIES—Continued

Page

Smith v. California, 361 U.S. 147 (1959) .............. 24

Stanley v. Georgia, 394 U.S. 557 (1969) .....000000..... 24

Straus Communications, Inc. v. FCC, 530 F.2d

BO RR te TY ori 18

Teleprompter Corp. v. Columbia Broadcasting

seetem, fac., 415 U.S. 804 (1974) _........0... 21

Valentine v. Chrestensen, 316 U.S. 52 (1932)........ 12, 23

Virginia State Board of Pharmacy v. Virginia Citi-

zens Consumer Council, 425 U.S. 748 (1976)..12, 18, 14

Wisconsin v. Constantineau, 400 U.S. 4383 (1971).. 15, 16

Administrative Decisions and Reports:

Cable Television Report and Order, 36 F.C.C.2d

tOe Clee ee

Garland B. Pugh, 68 F.C.C.2d 997 (1978) ............

Notice of Proposed Rulemaking and Notice of In-

quiry in Docket 18397, 15 F.C.C.2d 417 (1968).. 5

WAPA-TV Broadcasting Corp., 59 F.C.C.2d 263

>) Bor)

(ere Bcc, OS ORO A TE: 5

Advisory Opinions:

Op. Okla. Att’y Gen. No. 76-348 (November 24,

ere A nse 4

Op. Okla. Att’y Gen. No. 79-334 (March 19,

RO oe a EA Ree 4,5

Constitutional Provisions:

Constitution of the United States of America

ee 7

eee 7

ee ee passim

Fourteenth Amendment .................. Lech. pa

Twenty-ares Amendment ................................ passim

Constitution of the State of Oklahoma

re ee Oe i passim

vii

TABLE OF AUTHORITIES—Continued

Statutory Provisions:

kt Us. § 213 0C) (3) Coupp. V 1961) _...........

28 U.S.C. § 1254(1) (1976 & Supp. IV 1980)....

oe Aaa, & fool (1976 & Supp. V 1981) _........

28 U.S.C. § 1348 (1976 & Supp. V 1981) ............

me Ue, 20 (Sano ¥ 1981)

a2 U.S. $1968 (Sane. TV 1980) .............

Okla. Stat,/Ann. tit. 37, $506(8) (1981) ..............

Cita. Stat: Ann. tit. $7, $516 (1981) ..........

Regulations:

ae o. Granor? flee)

me (6 mee ieor-o. 6 (ieee)

Congressional Materials:

H.R. Rep. No. 1476, 94th Cong., 2d Sess. 89

Pier? 2 ee ea Na:

Publications:

C. Burck, Changing Habits in American Drinking,

Poruene. (oer oie...

Cable and Station Coverage Atlas (1982) _............

Comment, Access to Cable Television: A Critique

of the Affirmative Duty Theory of the First

Amendment, 70 Cal. L. Rev. 1393 (1982) _..........

Ely, Legislative and Administrative Motivation in

Constitutional Law, 79 Yale L.J. 1305 (1970)...

Multichannel News, March 28, 1983 _....... Sa SEI

Note, Cable Television and the First Amendment.

71 Colum. L. Rev. 1008 (1971) ......... SUL aS

Note, FCC Regulation of Cable Television Content,

my peers Ly ey. Soe (i978) .......

D. Pittman, Primary Prevention of Alcohol Abuse

and Alcoholism: An Evaluation of the Control

of Consumption Policy (Social Science Institute

of Washington University, 1981) _............__.

R. Wilkinson, The Prevention of Drinking Prob-

er fier

NIAAA oO

—

passim

Io tO

IN THE

Supreme Court of the United States

OCTOBER TERM, 1982

No.

CAPITAL CITIES CABLE, INC., et al.,

. Petitioners,

RICHARD A. CRISP, DIRECTOR,

OKLAHOMA ALCOHOLIC BEVERAGE CONTROL BOARD,

Respondent.

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE TENTH CIRCUIT

Capital Cities Cable, Inc. (formerly Cablecom-General,

Inc.!, Cox Cable of Oklahoma City, Inc., Multimedia Ca-

blevision, Inc., and Sammons Communications, Ine. re-

spectfully petition for a writ of certiorari to the United

States Court of Appeals for the Tenth Circuit to review

that court’s judgment of January 24, 1983, in Cablecom-

General, Inc. v. Crisp, No. 82-1061, which was decided

together with Oklahoma Telecasters Association v. Crisp,

No. 82-1058, in a single opinion.

OPINIONS BELOW

The opinion of the United States Court of Appeals for

the Tenth Circuit is reported at 699 F.2d 490 and ap-

pears as Appendix A to this petition. The opinion of the

United States District Court for the Western District of

Oklahoma granting a preliminary injunction is not re-

ported and appears as Appendix D to this petition. The

district court’s opinion on summary judgment is also not

reported and appears as Appendix G to this petition.

JURISDICTION

The judgment of the court of appeals was entered on:

January 24, 1983. On March 21, 1983, the court of ap-

peals denied a petition for rehearing filed by petitioners.

Appendix B. Jurisdiction of this Court is invoked under

28 U.S.C. $ 125411).

CONSTITUTIONAL PROVISIONS, STATUTES.

AND REGULATIONS INVOLVED

This case involves the First, Fourteenth, and Twenty-

first Amendments to the Constitution of the United

States; Article 27, Section 5 of the Constitution of the

State of Oklahoma; Section 516 of the Oklahoma Bever-

age Control Act, Okla. Stat. Ann. tit. 37, $516: Section

11lic!} (3) of the Copyright Act of 1976, 17 U.S.C.

$ 111(c) (3); and Section 76.55(b) of the rules of the Fed-

eral Communications Commission, 47 C.F.R. S 76.55 (b).

These provisions are set forth in Appendix H to this pe-

tition.

STATEMENT OF THE CASE

Petitioners operate cable television systems in the state

of Oklahoma. Much of petitioners’ cable service is com-

posed of programming that originates outside Oklahoma

and that is received by petitioners’ systems—by means

of antenna, microwave receiver, or satellite dish—and

retransmitted by wire to their subscribers. II R. Ss if

some cases, petitioners’ carriage of signals from out-

of-state television stations is mandated by the Federal

Communications Commission's so-called “must-carry”

* References to “IT BR. —."- and “IT R —__.* are to Volumes 1

and 2 of the record in this matter on appeal in the United States

Court of Appeals for the Tenth Circuit.

rules.’ II R. 34-35, 52-55. Most of the out-of-state pro-

gramming, however, is selected by the cable operators

themselves, and it is this programming which typically

furnishes the systems’ primary appeal to subscribers. II

R. 8, 10, 34. Out-of-state programming voluntarily car-

ried by petitioners includes the signals of commercial tele-

vision broadcast stations located in neighboring Kansas,

Missouri, and Texas and the signals of so-called “super

stations” located in such cities as Atlanta and Chicago."

II R. 32-83, 34-35, 53. This programming contains, from

time to time, commercials for brands of wine. II R. 33,

39. The wine commercials are lawful under federal law

and in the states where they originate. App. G at 4la.

While it does not appear in the record, petitioners also

provide advertiser-supported national cable programming

services, such as the Cable News Network (CNN) and

the USA Network, which also typically include wine com-

mercials.*

The sale and consumption of alcoholic beverages are

lawful in the state of Oklahoma. 699 F.2d at 500, App.

A at 19a-20a; App. G at 42a. By statute and in its con-

stitution, however, the state makes it unlawful “for any

person, firm or corporation to advertise any alcoholic

beverages or the sale of same within the State of Okla-

homa, except one sign at the retail outlet bearing the

words ‘Retail Alcoholic Liquor Store.’ ” Oklahoma Alco-

holie Beverage Control Act, Okla. Stat. Ann. tit. 37,

$516." The act specifically defines wine as an alcoholic

beverage within the scope of the advertising ban. 7d. at

* 47 C.F.R. $$ 76.57-.61 (1982).

“A “super station” is an independent television station whose

signal is relayed via statellite to cable systems beyond the normal

reach of its over-the-air signal.

* Petitioners also offer subscribers the option of receiving, at an

extra charge, certain so-called “pay’ services, such as Home Box

Office (HBO), that contain no advertising.

* See also Okla. Const. art. 27, S$ 5.

s 50613). The advertising of beer is permitted. 699 F.2d

at 492, 502, App. A at 3a-4a, 23a.*

The liquor advertising ban has for some years been

interpreted by the state to forbid Oklahoma broadcast

television stations from broadcasting wine commercials

as part of the national network programming they carry.

In upholding this application of the ban, the Oklahoma

Supreme Court relied heavily on its finding that televi-

sion stations are able to delete wine commercials from

the network programming. Oklahoma Alcoholic Beverage

Control Board v. Heublein Wines, 566 P.2d 1158, 1160,

1162 (Okla. 1977).

At the same time, the Oklahoma Attorney General has

construed the liquor advertising ban not to apply to ad-

vertisements appearing in newspapers, magazines and

other publications printed outside Oklahoma, including

publications specifically designed for circulation within

the state.‘ Out-of-state publications may be delivered to

Oklahoma subscribers and sold at outlets within the state

even though they contain wine or liquor advertising. 699

F.2d at 493 n.1, 502, App. A at 5a, 23a-24a.

For many years, the state applied a similar policy to

cable operators, and they were permitted to carry out-

of-state programming containing wine commercials. 699

F.2d at 492, App. A. at 4a; App. G at 4la. In March

1980, however, the Oklahoma Attorney General issued an

opinion stating that retransmission of such wine com-

mercials by cable systems operating in Oklahoma would

be considered in violation of state law. Op. Okla. Att’y

® The state’s definition of alcoholic beverages includes beer con-

taining more than 3.2 percent alcohol by weight. Okla. Stat. Ann.

tit. 37, $506(3). However, because beer advertising does not gen-

erally specify alcoholic content, the advertising of beer generally is

allowed. 699 F.2d at 492, App. A. at 3a-4a. _

* See, e.g., Op. Okla. Att’y Gen. No. 76-348 (November 24,

1976).

Gen. No. 79-334 (March 19, 1980). Respondent Richard

Crisp, Director of the Oklahoma Alcoholic Beverage Con-

trol Board, notified all Oklahoma cable operators, includ-

ing petitioners, that they faced imminent criminal prose-

cution if they continued to carry the out-of-state wine

commercials. 699 F.2d at 492, App. A at da: App. G at

4la.

Cable television operators are prohibited by federal law

from altering or modifying the content of the broadcast

television signals, including commercials, that they carry

to their subscribers. 699 F.2d at 492, App. A. at 4a;

App. G. at 40a. Section 76.55(b) of the Federal Com-

munications Commission’s rules, 47 C.F.R. £ 76.55(b)

(1982), requires that broadcast television programming

retransmitted by a cable system “shall be carried in full,

without deletion or alteration of any portion.” The Com-

mission has specifically held that the section forbids the

deletion of commercial messages.” Moreover, the Copy-

right Act of 1976 expressly prohibits eable systems operat-

ing under the statutory compulsory licensing system from

willfully deleting a commercial advertisement from a

television signal, subject to a minor exception not appli-

cable here. 17 U.S.C. $ 111(e) (3).

Even if deletion of the out-of-state wine commercials

were lawful, there would be, as the district court found

here, “no feasible way for [petitioners] to block out the

* See Garland B. Pugh, 68 F.C.C.3d 997. 999 (1978) (“Section

76.55(b) of the Rules... is meant to prohibit advertising dele-

tions as well”); WAPA-TV Broadcasting Corp. 59 F.C.C.2da 263,

272 (1976) ; Notice of Proposed Rulemaking and Notice of Inquiry

in Docket 18397, 15 F.C.C.2d 417, 444 (1968).

“The Act permits, in certain circumstances, deletion of commer-

cial advertising “by those engaged in television commercial adver-

tising market research.” 17 U.S.C. $111(c)} (3). The compulsory

cause it was deemed infeasible for cable systems that carry the

signals of numerous television stations to attempt to negotiate in-

dividual agreements with each of many different copyright owners

for the right to carry every program broadcast by each station.

See H.R. Rep. No. 1476, 94th Cong., 2d Sess. 89 (1976).

advertisements.” App. G at 41a. Petitioners liave no con-

tractual relationship wiih the out-of-state television :

tions whose signals they carry, no control over the pro-

gramming included in those signals by the stations, and

no advance notice from the stations concerning the sched-

uling of wine commercials. App. G at 40a; II R. 38-40,

56-57. Petitioners’ reception and retransmission of the

broadcast television signals occur simultaneously. II R.

45. Asa practical matter, therefore, even if it were law-

ful to do so, petitioners would be unable to delete each

wine commercial in its entirety as it appears: even to

attempt to delete the major part of each wine commercial

would require an extremely burdensome and costly effort

by petitioners to monitor each signal continuously. App.

D at 29a; II R. 38-41, 45-46, 54-58."

Petitioners would thus be compelled to discontinue

their carriage of all signals from commercial television

stations located outside Oklahoma if they were forbidden

from retransmitting out-of-state wine commercials. This

would deprive Oklahoma residents of access to the pro-

gramming offered by the Atlanta, Chicago and other “su-

per stations,” as well as that provided by other, less dis-

tant stations whose signals are available to Oklahoma

residents only by means of cable retransmission. The

record indicates that some Oklahoma towns would receive

no broadcast television signal at all if-cable operators

could not import signals from outside the state. II R. 55.

Failure to carry out-of-state signals would place some

cable operators in violation of the Federal Communications

Commission’s “must-carry” rules, 47 C.F.R. $$ 76.57-.61

(1982), which require them to carry certain out-of-state

signals to their subscribers. II R. 34-35, 52-55. Failure

to transmit out-of-state signals would also in some cases

10 See also Cable Television Report and Order, 86 F.C.C.2d 143,

154-56, 165 (1972) (Commission rejects as unworkable its own

proposal that would have required some cable systems to delete

commercials from certain distant television signals).

be contrary to cable operators’ franchise agreements with

the communities thev serve. App. G at 42a; II R. 55.

Finally, by preventing their carriage of out-of-state

broadcast signals, Oklahoma’s ban on out-of-state wine

commercials would deny cable operators the ability to

offer much of their most popular programming. II R. 10,

34, 55. As the district court found, this would cause the

operators a substantial loss in subscriber revenue, App.

G at 42a, in some cases imperiling their financial via-

bility. II R. 34.

District Court Proceedings

After being warned by state officials that they would

be prosecuted if they continued to retransmit out-of-

state wine commercials, petitioners brought an action

on March 3, 1981, in United States District Court for

the Western District of Oklahoma against respondent

Richard Crisp in his official capacity as director of the

Oklahoma Alcoholic Beverage Control Board. I R 1. Pe-

titioners sought injunctive relief against application of

Oklahoma’s liquor advertising ban to their carriage of

out-of-state wine commercials and programming con-

taining such commercials and sought a declaratory judg-

ment that such application would, inter alia, violate their

rights to freedom of speech and press guaranteed by

the First and Fourteenth Amendments to the United

States Constitution."

Following an evidentiary hearing, the district court

on March 6, 1981, issued a preliminary injunction en-

joining Crisp from enforcing the ban against petition-

'! Petitioners also alleged that enforcement of the liquor adver-

tising ban against them would violate the Commerce and Su-

premacy Clauses of the United States Constitution, Articles I and

VI, and the Equal Protection Clause of the Fourteenth Amend-

ment to the United States Constitution. Federal jurisdiction was

invoked under 28 U.S.C. $$ 1331, 1343, and 2201 and 42 U.S.C.

§ 1983.

ers’ carriage of out-of-state wine commercials. Appendix

D. On December 18, 1981, the district court entered

summary judgment for petitioners and issued a perma-

nent injunction. Appendices E, F.'* An opinion sup-

porting the orders was filed by the court on February 10,

1982. Appendix G."

The district court found that the wine commercials

carried by petitioners were not false or misleading and

did not advocate unlawful activity, App. G at 47a, and

held that they therefore were entitled to First Amend-

ment protection under the decisions of this Court re-

garding commercial speech. /d. The court ruled that

Oklahoma’s ‘blanket suppression,” id. at 49a, of this

advertising violated the First Amendment, relying on

Metromedia, Inc. v. City of San Diego, 453 U.S. 490

(1981), and other decisions of this Court for the propo-

sition that in the area of commercial speech “the State

cannot totally prohibit the dissemination of truthful in-

formation about a lawful activity.” App. G at 46a.

The court rejected the contention that Oklahoma’s

power to regulate liquor under the Twenty-first Amend-

ment superseded the requirements of the First Amend-

ment. /d. at 45a-46a. The court also found that the

liquor advertising ban failed to satisfy the requirements

of Central Hudson Gas & Electric Corp. v. Public Service

Commission, 447 U.S. 557 (1980), because it had been

shown to serve only remotely and ineffectively, if at all,

'2 On the same date, the district court awarded summary judg-

ment and injunctive relief to a group of Oklahoma broadcast tele-

vision stations that had brought a separate lawsuit challenging on

First Amendment grounds the state’s prohibition of their broad-

cast of wine commercials as part of their carriage of national net-

work programming. Oklahoma Telecasters Association v. Crisp,

No. Civ-81-439-W (W.D. Okla. December 18, 1981), rev'd, 699 F.2d

490 (10th Cir. 1983).

'S The February 10 opinion replaced an opinion filed with the

original orders. As the court of appeals noted, the opinions were

“nearly identical.”’ 699 F.2d at 493, App. A at 5a.

‘ the state’s asserted interests in temperance and dis-

couragement of alcohol abuse. Jw. at 48a. The court

pointed out that enforcement of the ban against peti-

tioners would:merely prohibit them “from disseminating

advertisements of something the public already knows

from experience and from reading [out-of-state] news-

paper and magazine advertising—that alcoholic bever-

ages exist and are for sale at certain prices.” Jd. at

45a. The court also concluded that the ban was con-

trary to the Court’s holding in Central Hudson because

there existed alternative measures, such as educational

programs, that could combat alcohol abuse more directly

and effectively without infringement on First Amend-

ment interests. Jd. at 48a-49a.

Finally, the court found that enforcement of the Okla-

homa laws against petitioners would effectively preclude

them from carrying any out-of-state broadcast signals,

since they are prevented by federal law from deleting

the commercials, id. at 38a, and since “there exists no

feasible way for [the operators] to block out the adver-

tisements.” Jd. at 41a."'

The Decision Below

On appeal, the Tenth Circuit reversed. holding that

enforcement of the Oklahoma liquor advertising ban

against petitioners did not violate the First Amend-

ment.'*

The court of appeals concurred with the district

court’s conclusion that the wine advertisements carried

by the cable operators concerned lawful activity, were

'* The court did not reach petitioners’ other constitutiona’ claims.

App. G at 39a-40a.

'S Petitioners’ other constitutional claims were not addressed by

the court of appeals. 699 F.2d at 493 n.1, App. A at da.

At the same time and with the same opinion, the court also re-

versed the district court's judgment for the broadcast plaintiffs in

Oklahoma Telecasters Association v. Crisp, No. 82-1058, which had

been consolidated with the cable operators’ case for purposes of

appeal.

not false or misleading, and therefore were “protected

speech under the First Amendment.” 699 F.2d at 500,

App. A at 20a. Nevertheless, the Tenth Circuit sus-

tained the ban, holding that this result was compelled

by this Court’s summary dismissal of the appeal in

Qreensgate Investment Co. v. Liquor Control Commis-

scon, 103 S.Ct. 31 (1982), decided after the district

court’s decision. Queensgate involved an appeal from a

decision by the Ohio Supreme Court " that sustained as

constitutional that state’s partial ban on off-premises

advertising of liquor prices by certain holders of liquor

permits. Although the Tenth Circuit recognized that

the Oklahoma restrictions ‘‘are indeed broader than the

regulation in Queensgate,” 699 F.2d at 497, App. A at

15a, it concluded that this Court’s dismissal of the

Queensgate appeal “mandate[d]” reversal of the district

court decision. 699 F.2d at 502, App. A at 24a.

In addition to relying on Queensgate, the Tenth Cir-

cuit held that the Oklahoma ban should be sustained

because of “the additional deference owed to the legisla-

ture as a result of the Twenty-first Amendment.” 699

F.2d at 501, App. A at 22a. The court therefore did not

require the state to justify its infringement of First

Amendment rights by the usual stringent standard and

upheld the Oklahoma restrictions after finding them “rea-

sonably related to reducing the sale and consumption of

[alcoholic] beverages and their attendant problems,” 699

F.2d at 501, App. A at 22a, and “no more extensive than

is necessary to serve Oklahoma’s asserted interest.” 699

F.2d at 502, App. A at 24a.

Although the court noted that cable television opera-

tors were precluded by federal law from deleting out-of-

state wine commercials from the programming they

carry, 699 F.2d at 492, App. A at 4a, and that they

“especially are placed in a difficult position” by the

liquor advertising ban, 699 F.2d at 502, App. A at 23a,

'6 Queensgate Investment Co. v. Liquor Control Commission, 433

N.E.2d 138 (Ohio 1982).

the court did not explain how the state. consistent with

the First Amendment, could effectively prohibit the car-

riage of out-of-state programming. Nor did the court

indicate how cable programming could be distinguished

in this respect from magazines and newspapers, which

may be distributed in Oklahoma even though they con-

tain liquor advertisements.

On March 21, 1983, the Tenth Circuit denied a peti-

tion for rehearing, Appendix B, and on April 4, 1983,

under Rule 41(b) of the Federal Rules of Appellate

Procedure, the court stayed its mandate for 30 days

pending the filing of this petition. Appendix C.,

REASONS FOR GRANTING THE WRIT 4

This case presents important First Amendment issues

meriting this Court’s review. The Tenth Circuit’s deci-

sion, if not reversed, would permit the kind of sweeping

ban on commercial speech that decisions of this Court

have repeatedly condemned. The decision would also

countenance an unprecedented state restriction on the

press and on the interstate flow of information and

ideas since the regulation at issue would effectively

prevent cable television operators from carrying out-of-

state advertiser-supported programming into Oklahoma.

I. THE COURT BELOW HAS DECIDED AN IMPOR-

TANT CONSTITUTIONAL QUESTION CONCERN.

ING THE PROTECTION OF COMMERCIAL

SPEECH IN CONFLICT WITH DECISIONS OF

THIS COURT AND CONTRARY TO THE OPINION

OF ANOTHER CIRCUIT.

A. The Decision of the Court Below Upholds a Sweep-

ing Ban On Truthful Advertising of a Lawful

Product in Conflict With Decisions of This Court.

In upholding Oklahoma’s ban on the advertising of

alcoholic beverages, the decision below js in direct conflict

with decisions of this Court holding that the First

Amendment bars states from prohibiting the dissemina-

tion of truthful, non-misleading information about a law-

ful product."

While at one time decisions of this Court suggested

that commercial speech was not constitutionally pro-

tected,’* the Court has repeatedly held over the last decade

that truthful advertising related to lawful products and ac-

tivities is protected by the First Amendment.'’ It has em-

phasized the societal benefits in preserving a free flow

of commercial information about goods and services, and

has forcefully repudiated the ‘paternalistic’? approach,”

adopted below by the Tenth Circuit, that would permit

states to protect their citizens against perceived dangers

of lawfully available products by banning the dissemina-

tion of information about those products.*!

Contrary to the decision below, this Court in recent

years “has not approved a blanket ban on commercial

speech unless the expression itself was flawed in some

way, either because it was deceptive or related to un-

lawful activity.” Central Hudson Gas & Electric Corp.

v. Public Service Commission, 447 U.S. 557, 566 n.9

(1980). It has struck down as unconstitutional prohibi-

tions on advertising by lawyers, Bates v. State Bar of

1T See, e.g., Metromedia, Inc. v. City of San Diego, 453 U.S. 490.

505 (1981); Central Hudson Gas & Electric Corp. v. Public Service

Commission, 447 U.S. 557, 570-72 (1980); id. at 573-79 (Black-

mun, J., concurring in judgment); Bates v. State Bar of Arizona,

433 U.S. 350 (1977); Carey v. Population Services International,

431 U.S. 678, 700-02 (1977); Virginia State Board of Pharmacy

v. Virginia Citizens Consumer Council, 425 U.S. 748, 773 (1976):

Bigelow v. Virginia, 421 U.S. 809 (1975).

18 See, e.g., Valentine v. Chrestensen, 316 U.S. 52 (19§

19 See, e.g., In re R.M.J., 455 U.S. 191, 199 (1982).

2° Virginia State Board of Pharmacy, 425 U.S. at 770.

“1 See Central Hudson, 447 U.S. at 561; Bates, 483 U.S. at 264:

Virginia State Board of Pharmacy, 425 U.S. at 765.

Arizona, 433 U.S. 350 (1977);** on price advertising

by pharmacists, Virginia State Board of Pharmacy v.

Virginia Citizens Consumer Council, 425 U.S. 748

(1976) ; on the advertising of abortion services, Bigelow

v. Virginia, 421 U.S. 807 (1975); on the advertising of

contraceptives, Carey v. Population Services Interna-

tional, 431 U.S. 678 (1977); and on promotional] adver-

tising by utilities, Central Hudson Gas & Electric Corp.

v. Public Services Commission, 447 U.S. 557 (1980).

As stated most recently in the plurality opinion in

Metromedia, Inc. v. City of San Diego, 450 U-S. 490,

505 (1981):

“A State may not completely suppress the dissemi-

nation of truthful information about an entirely

lawful activity merely because it is fearful of that

information’s effect upon its disseminators and its

recipients,” *

The restriction on commercial] speech upheld by the

Tenth Circuit is precisely the sort of restriction this

Court has repeatedly condemned. Oklahoma’s liquor ad-

vertising ban is plainly not directed, or even claimed to

be directed, at commercia] speech that is false, deceptive

or misleading.** Nor does the restricted commercial

speech promote an unlawful product or activity; the sale

and the consumption of liquor and wine are lawful in

Oklahoma. The acknowledged purpose of the restriction is

to discourage liquor sales and consumption by restricting

the flow of commercial information about liquor to the

citizens of the state, 699 F.2d at 500. App. A at 20a—in

other words, to enforce the kind of “protection based .. .

** See also In re R.M.J., supra (holding unconstitutional various

restrictions on the content of lawyers’ advertising).

“3 See also Carey v. Population Services, Inc., 431 U.S. at 700;

Virginia State Board of Pharmacy, 425 U.S. at 774.

“4699 F.2d at 500 n.8, App. A at 20a n.8. Both the district court

and the court of appeals agreed that the specific advertisements at

issue here—the out-of-state wine commercials—are truthful and

non-misleading. 699 F.2d at 500, App. A at 20a; App. G at 47a.

on public ignorance,” Virginia State Board of Pharmacy,

425 U.S. at 769, that this Court has forcefully rejected.”

This Court’s summary dismissal of the appeal in

Queensgate Investment Co. v. Liquor Control Commis-

sion, 103 8. Ct. 31 (1982), a decision relied on heavily by

the Tenth Circuit below, is not to the contrary and is

clearly distinguishable from the present case. This Court

has emphasized that its summary dispositions should be

narrowly interpreted to extend only to “the precise issues

presented and necessarily decided . . . [and] should not

be understood as breaking new ground.” Mandel v. Brad-

ley, 482 U.S. 173, 176 (1977). The Ohio regulation up-

held in Queensgate forbade certain liquor permit holders

from advertising off-premises the price of liquor per

drink or per bottle and from comparing their retail prices

to those of their competitors. See Queensgate Investment

Co. v. Liquor Control Commission, 4833 N.E. 2d 135, 139

n.l (Ohio 1982). The permit holders were allowed, how-

ever, to advertise in any medium any other information

about alcoholic beverages, including prices in the original

containers, and manufacturers and distributors of alco-

holic beverages were permitted to advertise their prod-

ucts without restriction. This is a far ery from Okla-

homa’s sweeping ban on liquor advertising, which even

the Tenth Circuit recognized to be “indeed broader than

** As the district court found, the fostering of public ignorance

in this area is contrary to the purposes of the First Amendment.

App. G at 49a-50a. By informing consumers of the availability

and nature of a lawful product, the wine commercials at issue here

aid “the allocation of resources in a free enterprise system.” Bates

v. State Bar of Arizona, 433 U.S. at 364. In addition. just as the

utility advertising for electrical products protected by this Court

in Central Hudson could have the effect of promoting energy con-

servation by offering an alternative to less energy-efficient products,

447 U.S. at 570, so here, by presenting an alternative to hard liquor

and spirits, wine commercials can promote moderation in the con-

sumption of alcohol. See, e.g., C. Burck, Changing Habits in Ameri-

can Drinking, Fortune, October 1976, at 159-60. The dissemination

of such messages serves the interest of an informed public.

the regulation in Queensgate.” 699 F.2d at 497, App. A.

at 15a.*°

The Tenth Cireuit’s decision also conflicts with deci-

sions of this Court insofar as it holds that the First

Amendment provides lesser protection when a state seeks

to restrict liquor advertising under regulatory power con-

ferred by the Twenty-first Amendment. 699 F.2d at 498,

901-02, App. A at 15a-17a, 22a, 24a. This Court has

emphasized that the Twenty-first Amendment does not

alter the standard of review under the First Amendment

or other constitutional provisions protecting individual

rights. See Larkin v. Grendel’s Den, Inc., 51 U.S.L.W.

4025, 4027 n.5 (U.S. December 13, 1982) (“The state

may not exercise its power under the Twenty-first

Amendment in a way which impinges upon the Establish-

ment Clause of the First Amendment”); Craig v. Boren,

429 U.S. 190, 209 (1976) (the Twenty-first Amendment

“does not alter the application of equal protection stand-

ards that otherwise govern this case’) : Wisconsin v. Con-

“° The regulation approved in Queensgate involved only a re-

striction on advertising by the holders of liquor permits, and this

Court has made clear that a state’s power to impose conditions on

the granting of liquor permits is greater than its power generally

to regulate First Amendment activity. See Craig v. Boren, 429

U.S. 190, 209 (1976); California v. LaRue, 409 U-S. 109, 118

(1972) (“The critical fact is that California has not forbidden

these performances across the board {| but] has merely proscribed

‘them] to establishments that it licenses to sell liquor by the

drink’). See also New York State Liquor Authority v. Bellanca.

452 U.S. 714, 715 (1981). In this case, on the other hand, Okla-

homa seeks to enforce its liquor advertising ban directly against

the press. This Court held in Bigelow v. Virginia, 421 U.S. 809,

828 (1975), that a ban on advertising “incur[s] more serious First

Amendment overtones” when applied against the press rather than

the advertiser. See also Lamar Outdoor Advertising, Inc. v. Mis-

sissippt State Tar Commission, 701 F.2d 314, 330, reh'g en banc

ordered (Sth Cir. 1983) (“| A|pplication of [an advertising ] reg-

ulation against liquor licensees raises different constitutional issues

than enforcement of « subject matter ban against publishers and

broadcasters”’).

stantineau, 400 U.S. 433, 486 (1971) (state’s power to

regulate liquor does not relax requirements of procedural

due process) .27

Finally, the decision below conflicts with this Court’s

assertion in Central Hudson Gas & Electric Corp. v.

Public Service Commission, 447 U.S. at 564, that even

a limited restriction on protected commercial speech

“may not be sustained if it provides only ineffective or re-

mote support for the government’s purpose ... [or] if

the governmental interest could be served as well by a

more limited restriction.” ** The record in this case con-

tains no evidence that liquor advertising, in particular

out-of-state commercials for brands of wine, contributes

directly to alcohol abuse, or that the suppression of such

commercials directly or effectively promotes temperance.

App. G at 48a." To the contrary, the district court found

that Oklahoma’s ban on such advertising serves the state’s

purposes in at most a remote, indirect and ineffective

fashion. App. G at 45a, 48a. The district court also

found that Oklahoma had failed to demonstrate the ab-

sence of alternative measures that could serve the goal of

temperance as directly or effectively as the advertising

ban without such adverse impact on First Amendment

rights. App. G at 48a-49a.

The Tenth Circuit’s decision in this case, if allowed to

stand, is likely to have the effect of encouraging other

“7 See also California Retail Liquor Dealers Ass'n v. Midcal

Aluminum, Inc., 445 U.S. 97, 108 (1980) (Twenty-first Amend-

ment does not “insulate” states from constitutional requirements).

“8 See also In re R.M.J., 455 U.S. at 203.

“" See also D. Pittman, Primary Prevention of Alcohol Abuse and

Alcoholism: An Evaluation of the Control of Consumption Policy

18 (Social Science Institute of Washington University, 1981)

(“[N]lo scientific evidence exists that beverage alcohol adver-

tising has any significant impact on the rate of alcohol abuse

and alcoholism in American society”); R. Wilkinson, The Preven-

tion of Drinking Problems 43-48, 132, 157 (1970).

states to adopt restrictions on the Oklahoma model. The

questions presented are thus of substantial importance.

B. The Decision of the Court Below Is Contrary to

the Opinion of Another Circuit.

The decision below is directly contrary to a recent

opinion of a panel of the Fifth Circuit declaring a similar

state ban on liquor advertising to be an unconstitutional

infringement on commercial speech.” At issue was a

Mississippi statute prohibiting liquor advertisements that

originated within the state. The Fifth Circuit panel con-

cluded that the statutory ban violated the First Amend-

ment.

In doing so, the panel expressly rejected both the result

reached by the Tenth Circuit in this case and the reason-

ing it employed. The panel found inapplicable the Su-

preme Court’s summary dismissal of the appeal in

Queensgate Investment Co. v. Liquor Control Commis-

sion, 103 S. Ct. 31 (1982), and specifically rejected the

interpretation placed on Queensgate by the Tenth Cir-

cuit.*' The panel also concluded, contrary to the Tenth

Circuit, that the state’s authority under the Twenty-first

Amendment did not change the standard of review under

the First Amendment. And the panel found that Mis-

sissippi’s ban on liquor advertising did not effectively pro-

mote the state’s interest in controlling liquor consump-

tion, relying principally on the fact that liquor commer-

cials continued to enter the state through magazines and

newspapers published outside Mississippi and through

radio and television signals received directly by Missis-

*” Lamar Outdoor Advertising, Inc. v. Mississippi State Tax Com-

mission, 701 F.2d 314, reh'g en bane ordered (5th Cir. March 11,

1983). See also Dunagin v. City of Oxford, 701 F.2d 335, reh’g en

bane ordered (5th Cir. March 11, 1983) (applying and following

Lamar).

"1 See Lamar, 701 F.2d at 331 n.23.

*2 Id. at 329-330.

sippi residents from stations outside the state.** A simi-

lar situation exists in Oklahoma, as found by the district

court in the present case. App. G at 45a, 48a.

There is thus a clear inconsistency between the decision

of the Tenth Circuit and the opinion of the Fifth Circuit

panel. These important issues warrant review by this

Court."

Il. THE COURT BELOW HAS DECIDED AN IMPOR-

TANT CONSTITUTIONAL QUESTION CONCERN-

ING THE PROTECTION OF NONCOMMERCIAL

SPEECH IN CONFLICT WITH DECISIONS OF

THIS COURT.

This case is also important because it is the first case

to come before this Court involving the power of the

states under the First Amendment to regulate the content

of cable television programming. As the number of cable

subscribing households has grown from 2.8 million in

1968 to more than 31 million today,” state and local gov-

ernments have increasingly sought to play a role in the

“Id. at 332-33. “When a state seeks to impose such a severe

ban upon protected commercial speech, it must at least show that

its law does some good.” Jd. at 333.

‘' Recognizing that their decisions produced a conflict between

the circuits, the Fifth Circuit ordered rehearing en banc. Lamar,

701 F.2d at 316; Dunagin, 701 F.2d at 336. Under the rules of the

Fifth Circuit, the effect of this action was to vacate the panel

opinions and judgments. Vacation of the opinions does not neces-

sarily deprive them of persuasive authority, both within the Fifth

Circuit and without. See, e.g., Straus Communications, Inc. v.

FCC, 530 F.2d 1001, 1008 n.16 (D.C. Cir. 1976) (citing National

Broadcasting Co., Inc. v. FCC, 516 F.2d 1101, vacated, 516 F.2d

1180 (1D.C. Cir. 1974), cert. denied, 424 U.S. 910 (1976) ).

* See Cable & Station Coverage Atlas 18a (1982); Multi-

cl.annel News, March 28, 1983, at 3. The current figure represents

more than 37 percent of the nation’s television households. Jd.

regulation of cable program content. Such regulation

raises vital First Amendment questions deeply affecting

this increasingly important medium of communication.

The regulation at issue here would impose a_partic-

ularly grave burden on the First Amendment rights of

cable television operators and subscribers. The record in

this case shows, and both the district court and the court

of appeals found, that prohibition of petitioners’ carriage

of out-of-state wine commercials will effectively preclude

petitioners from distributing not only those commercials,

but the entire programming of out-of-state television

signals, including news programs, editorials. documenta-

ries, entertainment, and other expressions of ideas and

information.**

As discussed above, the carriage of such programming

will be effectively foreclosed because petitioners are pre-

vented by federal law and by overwhelming technical and

economic obstacles from deleting the wine commercials

that are contained in the programming.” It is for these

reasons that the district court found that petitioners’ only

“feasible” alternative, App. G at 39a, would be to drop

entirely their carriage of out-of-state broadcast television

programming. In fact, for some cable operators the only

feasible alternative will be to cease operations entirely,

since failure to carry out-of-state television signals will

place them in violation of the Federal Communications

Commission’s “‘must-carry” rules. 47 C.F.R. $ 76.57-.61.

Other systems, no longer able to offer out-of-state broad-

cast signals, will lose subscriptions as a result and suffer

severe, in some cases fatal, economic losses. App. G at

42a; II R. 34-35." Although it does not appear in the

6 699 F.2d at 492, App. A at 4a: App. G at 4la.

*7 See pages 5-6, supra.

“* The state’s imposition of such a debilitating economic burden

on cable operators in itself raises important First Amendment

record, petitioners would also be effectively compelled to

cease carrying national cable programming services con-

taining wine commercials, such as the Cable News Net-

work and the USA Network.”

There can be no doubt that cable television—like news-

papers, broadcast television, and motion pictures 4__is

today “a significant medium for the communication of

ideas . . . included within the free speech and free press

guaranty of the First and Fourteenth Amendments.”

Joseph Burstyn, Ine. &. Wilson, 343 U.S. 499, 501-02

concerns. Compare Pittsburgh Press Co. v. Pittsburgh Commis-

sion on Human Relations, 413 U.S. 376 (1973), in which this Court

upheld municipal regulations on the format of a newspaper's ad-

vertising columns only after determining that the regulations did

not “threate(n | |appellant’s | financial viability, - - - impai[r} in

any significant way its ability to publish and distribute its news-

paper,” or “endanger arguably protected speech.” Jd. at 383, 390.

Such threats to critical First Amendment interests are plainly

posed here. See also Grosjean v. American Press Co., 297 U.S. 233,

250 (1936), in which this Court held that a state tax on the adver-

tising revenue of newspapers having a circulation of 20,000 or

more violated the First Amendment because of its tendency “to

limit the circulation of information to which the public is entitled

in virtue of the constitutional guarantees.” And see Minneapolis

Star & Tribune Co. Uv. Minnesota Commissioner of Revenue, 51

U.S.L.W. 4315 (U.S. March 29, 1983) (state tax on publications’

use of paper and ink violates First Amendment).

30 While deletion of commercials from such national cable pro-

gramming services would not violate federal law, it would be in

violation of the cable operator’s contract with the service provider,

which customarily prohibits the removal of advertising. The pro-

viders of such programming also typically do not provide cable

operators with prior notice concerning the scheduling and nature

of commercials, so that the technical and economic impracticality

of attempting to delete the commercials is the same as in the case

of broadcast television signals. See pages 5-6, supra.

40 See Miami Herald Publishing (0. &- Tornillo, 418 U.S. 241

(1974) (newspaper publishers} ; Columbia Broadcasting System,

Inc. v. Democratic National Committee, 412 U.S. 94 (1973) (broad-

=o |

casters); Joseph Burstyn, Inc. ev. Wilson, 343 U.S. 495 (1992

(motion pictures).

(1952). Courts which have reached the issue have rec-

ognized that the First Amendment protects both the pro-

gramming carried by cable operators and the operators’

editorial function in selecting that programming. See, e.g.,

Midwest Video Corp. v. FCC, 571 F.2d 1025, 1053-57 (8th

Cir. 1978), aff'd on other grounds, 440 U.S. 689 (1979):

Home Box Office, Inc. v. FCC, 567 F.2d 9, 43-51 (D.C.

Cir.), cert. denied, 484 U.S. 829 (1977).4 While this

Court has not explicitly addressed the question of cable

operators’ First Amendment status, it has recognized

that cable operators exercise editorial discretion in choos-

ing signals and services. FCC v. Midwest Video Corp.,

440 U.S. 689, 707 (1979) ; Teleprompter Corp. v. Colum-

bia Broadcasting System, Inc., 415 U.S. 394, 410 11974)

(choice of broadcast signals by cable operators is a “crea-

tive function”’).

In exempting out-of-state publications from its liquor

advertising ban, the state of Oklahoma has apparently

recognized that it could not forbid the sale of the New

York Times and the Wall Street Journal within the state

because they contain wine advertising. Yet Oklahoma

seeks to enforce a similar ban against cable operators

who—like the Oklahoma distributors of the New York

Times and the Wall Street Journal—must either offer

the communication in its entirety, including wine adver-

tisements, or forgo its distribution. Such regulation re-

stricting the flow of information into the State is no less

unconstitutional applied to cable operators than it would

be if applied to newspaper distributors.

*! See also Community Communications Co. v. City of Boulder.

660 F.2d 1370, 1376 (10th Cir. 1981), petition for cert. dismissed

by agreement, 102 S. Ct. 2287 (1982). And see Comment, Access

to Cable Television: A Critique of the Affirmative Duty Theory of

the First Amendnrent, 70 Cal. L. Rev. 1393 (1982); Note, FCC

Regulation of Cable Television Content, 31 Rutgers L. Rev. 238

(1978); Note, Cable Television and the First Amendment, 71

Colum. L. Rev. 1008 (1971).

It is the fundamental] purpose of the First Amendment,

as applied to the states through the Fourteenth Amend-

ment, to protect from governmental interference the na-

tional ‘“‘free trade in ideas.” Abrams v. United States,

250 U.S. 616, 680 (1919) (Holmes, J., dissenting). To

this end, the amendment is designed to ensure that infor-

mation may flow freely across the country and that ideas

originating in New York and New England may be made

available to the citizens of Oklahoma and Mississippi.

For an individual state to ban entirely an out-of-state

communication because it contains objectionable advertis-

ing, when that advertising is neither misleading nor de-

signed to encourage the consumption of an unlawful prod-

uct, strikes at the very heart of the national commerce in

ideas. No state, consistent with the First Amendment,

may erect such barriers to the free flow of ideas or so

“shield its citizens from information about activities out-

side [its] borders.” Bigelow v. Virginia, 421 U.S. at

827-28.** :

That the Oklahoma ban does not expressly forbid—and

is not intended to forbid—the importation of all out-of-

state signals does not rescue the regulation when so sub-

stantial an “effect on the exercise of First Amendment

rights arises ... as an unintended but inevitable result

of the government’s conduct.” Buckley v. Valeo, 424 US.

1, 65 (1976) (per curiam). See elso Elrod v. Burns, 427

U.S. 347, 362 (1976); Louisiana ex rel. Gremillion v.

NAACP, 366 U.S. 293, 297 (1961) 1 “[R]Jegulatory meas-

ures . . . cannot be employed in purpose or in effect to

stifle, penalize, or curb the exercise of First Amendment

§2 See also Board of Education v. Pico, 50 U.S.L.W. 4831, 4835

(U.S. June 25, 1982) (“‘| A] State may not, consistently with the

spirit of the First Amendment, contract the spectrum of available

knowledge’’’) (quoting Griswold v. Connecticut, 381 U.S. 479,

482 (1965) ); Epperson v. Arkansas, 393 U.S. 97 (1968): New York

Times v. Sullivan, 376 U.S. 254 (1964); Martin v. City of Struthers,

319 U.S. 141, 146-47 (1943).

rights”) (emphasis added); NAACP v. Alabama, 357

U.S. 449, 460-61 (1958).*

Nor is the regulation saved because it is directed at

commercial speech, even if the advertising in question

Were itself unprotected by the First Amendment.** The

decision below is directly contrary to decisions of. this

Court holding that a state may not prevent the dissemi-

nation of protected speech on the ground that it includes

some suppressible commercial material or activity. Thus,

in Jamison v. Texas, 318 U.S. 413 (1943), the Court re-

versed the conviction of a Jehovah’s Witness for distribut-

ing religious handbills that included an advertisement for a

religious publication. Noting that states then could gen-

erally “prohibit the use of the streets for the distribution

of purely commercial leaflets,” id. at 417. the Court

nevertheless held that ‘[t]he mere presence of an adver-

tisement” on a_handbill furthering religious activity

“may not subject the distribution of the handbill to pro-

hibition.” Jd. at 416.° In In re Primus, 486 U.S. 412

"= This Court has repeatedly struck down regulations that sub-

stantially restricted important avenues or media of expression,

notwithstanding that the purpose of the regulation was unrelated

to the content of the speech. See, ¢.y., Saia v. New York, 334 U.S.

998 (1948) (sound trucks): Martin v. City of Struthers, supra

(door-to-door solicitation) : Schneider rv. State, 308 U.S. 147 (1939)

(leafletting). See also Ely, Legislative and Administrative Moti-

vation in Constitutional Law, 79 Yale 1..J. 1205, 1335-36 (1970)

(“The state is obligated to protect the channels of communication,

even if it takes a special exception and some sacrifice of the state's

expression-unconnected interest”). And the Court has viewed with

particular alarm regulations that would have the effect. if not the

aim, of curtailing the press’ ability freely to disseminate informa-

tion of its choosing. See, e.4., Miami Herald Publishing Co. v.

Tornillo, 418 U.S. 241 (1974): Columbia Broadcasting System, Inc.

v. Democratic National Committee, 412 U.S. 94 (1973); New York

Times v. Sullivan, 376 U.S. 254 (1964): Grosjean v. American Press

Co., 297 US. 238 (1936).

*4 But see Section I, supra.

"See also Murdock v. Pennsylvania, 319 U.S. 105 (1943). Com-

v. Chrestensen, 316 U.S. 52 (1942), in which this

pare Valentine

{ Footnote continued }

(1978), the Court held that a ban on in-person solicita-

tion by lawyers—generally a permissible restraint on

commercial speech *°—could not be applied to solicitation

by a lawyer for the American Civil Liberties Union be-

cause it threatened the effectiveness of the ACLU “as a

vehicle for effective political expression and association,”

id. at 431, and thus implicated not only commercial speech

but also “core First Amendment rights.” Jd.”

If allowed to stand, the Tenth Circuit’s decision in this

case will permit the state of Oklahoma to severely abridge

First Amendment rights by restricting the flow of ideas

and information into the state and by curtailing the abil-

ity of cable operators to select the programming they

carry. The case is of great importance to the future of

cable television, an increasingly vital medium in the dis-

semination of news and information in this country.

And here, as in Bigelow v. Virginia, 421 U.S. 809 (1975):

“If application of this statute were upheld under

these circumstances, [the state] might exert the

power sought here over a wide variety of national

publications or interstate newspapers carrying ad-

vertisements similar to the one [fat issue]

Court held that a distributor of handbills composed primarily of

commercial advertising could not escape a municipal ban on com-

mercial leafletting by affixing a civic protest to the advertising

“with the intent, and for the purpose, of evading the prohibition.”

Id. at 55. There can, of course, be no suggestion in this case that

the cable operators carry protected programming in addition to

wine commercials in an effort to avoid Oklahoma's ban on liquor

advertising.

**® See Ohralik v. Ohio State Bar Ass'n, 486 U.S. 447 (1978).

*? Similarly, this Court has struck down state regulations aimed

at unprotected obscenity or libel when their impact would extend

more broadly to restrict the dissemination of protected ideas.

See, e.g., New York Times Co. v. Sullivan, 376 U.S. 254. 278-79

(1964); Smith ». California, 361 U.S. 147, 151 . 1959); Stanley

r. treorgia, 394 U.S. 557 (1969). See also Butler +. Michigan, 352

U.S. 380 (1957).

Other States might do the same. The burdens

thereby imposed on publications would impair, per-

haps severely, their proper functioning.” Jd. at

828-29 (tootnotes omitted).

These critical questions require review by this Court.

CONCLUSION

For the reasons stated above, a writ of certiorari

should be granted to review the judgment of the United

States Court of Appeals for the Tenth Circuit.

J ar

respectfully submitted,

Of Counsel: TIMOTHY B. DyK *

CLYDE A. MUCHMORE JOHN W. ZUCKER

CROWE & DUNLEVY WILMER, CUTLER & PICKERING

1800 Mid-America Tower 1666 kK Street, NM we

20 North Broadwav Washington, D.C. 20006

i ae : In9 77>.

Oklahoma City,OK 73102 —-(292) 872-6000

Counsel for Petitioner

Capital Cities Cable, Inc.

JOHN D. MATTHEWS *

DAVID P. FLEMING

J. CHRISTOPHER REDDING

Dow, LOHNES & ALBERTSON

1225 Connecticut Ave., N.W.

Washington, D.C. 20036

(202) 862-8079

Counsel for Petitioners Cor

Cahle of Oklahoma City, Inc. :

Multimedia Cablevision, Inc.:

and Sammons Communica-

tions, Tne.

May 3, 1983 * Counsel of Record

APPENDICES

TABLE OF CONTENTS

APPENDIX A

Opinion of the United States Court of Appeals for

the Tenth Circuit, Januarv 24, 1983

APPENDIX B

Order of the United States Court of Appeals for

the Tenth Circuit Denying Petition for Rehearing,

te 8 Oe

APPENDIX C

Order of the United States Court of Appeals for

the Tenth Circuit Granting Motion for Stay of

more. An © 19.

APPENDIX D

Findings and Order of the United States District

Court for the Western District of Oklahoma Grant-

ing Motion for Preliminary Injunction, March 19,

cig, SE EOE

APPENDIX E

Order of the United States District Court for the

Western District of Oklahoma (Declaratory Judg-

ment), December 16, 61...

APPENDIX F

Order of the United States District Court for the

Western District of Oklahoma (Permanent Injunc-

tion), December 18,198]... OE: na Nt

APPENDIX G

Opinion of the United States District Court for

the Western District of Oklahoma on Summary

Judgment, February 10,1982...

APPENDIX H

Constitutional Provisions, Statutes. and Regula-

Goms Involved .......

Page

26a

28a

3la

34a

Sla

APPENDIX A

UNITED STATES COURT OF APPEALS

TENTH CIRCUIT

Nos. 82-1058, 82-1061

OKLAHOMA TELECASTERS ASSOCIATION, an unincorporated

association; COMBINED COMMUNICATIONS CORPORA-

TION OF OKLAHOMA, INC., an Oklahoma corporation;

GRIFFIN TELEVISION, INC., an Oklahoma corporation;

KTVY, INc., an Oklahoma corporation: KTUL-TV,

INc., an Oklahoma corporation; KOTV, INc.. an Ok-

lahoma corporation; ScRIPPS-HOWARD BROADCASTING

Co., an Ohio corporation; GOLDEN WEST BROADCAST-

ERS OF OKLAHOMA, INC., an Oklahoma corporation ;

BLAIR BROADCASTING OF OKLAHOMA, INC., an Okla-

homa corporation; EASTERN OKLAHOMA TELEVISION

Co., INC., an Oklahoma corporation; SERAPHIM CORP.,

an Oklahoma corporation; KOKI-TV. an Oklahoma

partnership; and TuLsa TV 41, a joint venture,

Plaintiffs-A ppellees,

RICHARD A. CRISP, Director,

Alcoholic Beverage Control Board.

Defendant-A ppellant.

CABLECOM-GENERAL, INC.: Cox CABLE OF OKLAHOMA

CITY, INC.; MULTIMEDIA CABLEVISION, INC.: and

SAMMONS COMMUNICATIONS, INC..

Plainti ffs-A ppellees,

¥,

RICHARD A. CRISP, Director,

Alcoholic Beverage Control Board.

Defendant-A ppellant.

Jan. 24, 1983

Robert D. Nelon, Oklahoma City, Okl. (Roy J. Davis,

L. Gene Gist and Nancy M. Thompson, Oklahoma City,

Okl., with him on the brief), of Andrews Davis Legg

Bixler Milsten & Murrah, Oklahoma City, Okl., for plain-

tiffs-appellees Oklahoma Telecasters Ass’n, et al.

Clyde A. Muchmore, Oklahoma City, Okl. (Richard C.

Ford, Oklahoma City, Okl., with him on the brief), of

Crowe & Dunlevy, Oklahoma City, Okl., for Cablecom-

General, Inc. (John D. Matthews, David P. Fleming

and J. Christopher Redding of Dow, Lohnes & Albert-

son, Washington, D.C., for Cox Cable of Oklahoma City,

Inc., Multimedia Cablevision, Inc., and Sammons Com-

munications, Inc., with them on the brief), in No. 82-1061.

Gary W. Gardenhire, Asst. Atty. Gen., Okl., Oklahoma

City, Okl. (Jan Erie Cartwright, Atty. Gen. of Okl., Ok-

lahoma City, Okl.), for defendant-appellant.

Jerry D. Sokolosky, Oklahoma City, Okl., filed an

amicus curiae brief for Oklahoma Press Ass’n and Out-

door Advertising Ass’n of Okl.

Larry Derryberry of Derryberry Duncan & Gray, Ok-

lahoma City, Okl., filed an amicus curiae brief for

S.A.N.E., Inc.

Bill Allain, Atty. Gen. of Miss., and Peter M. Stockett.

Asst. Atty. Gen. of Miss., Jackson. Miss. (W. Timothy

Jones and John E. Milner of Brunini. renten. Grower

& Hewes, Jackson, Miss.. of counsel), filed an amicus

curiae brief for the State of Miss.

Before BARRETT, McKAY and LOGAN, Circuit

Judges.

BARRETT, Circuit Judge.

Richard A. Crisp (Crisp) appeals from two summary

judgments declaring that certain provisions of Okla-

homa’s constitution and statutes violate the First and

Fourteenth Amendments of the United States Constitu-

tion. The appeals were consolidated pursuant to Fed.R.

App.P. 3(b).

Appellee in No. 82-1058, Oklahoma Telecasters Asso-

ciation (Telecasters:, is an unincorporated association of

corporations and partnerships engaged in the business of

television broadcasting in the State of Oklahoma. Appel-

lees in No. 82-1061 are holders of cable television fran-

chises in the State of Oklahoma and will be referred to

as the “cable operators”. Appellant, Crisp, is the former

director of the Oklahoma Alcoholic Beverage Control

Board, an agency charged with primary responsibility

for the enforcement of Oklahoma laws regulating the

sale and consumption of alcoholic beverages.

The Oklahoma Constitution stringently restricts the

advertising of alcoholic beverages:

It shall be unlawful for any person, firm or cor-

poration to advertise the sale of alcoholic beverage

Within the State of Oklahoma, except one sign at the

retai! outlet bearing the words “Retail Alcoholic

Liquor Store.”’

Okla. Const. art. XXVII, $5. The Oklahoma Alcoholic

Beverage Contro] Act similarly prohibits the advertising

of “alcoholic beverages or the sale of the same within

the State of Oklahoma,” except by strictly regulated on-

premises signs. Okla.Stat. Ann. tit. 37, $516 (West

Supp.1982). That act defines “alcoholic beverage” as

“alcohol, spirits, beer, and wine. . . .” Okla.Stat. Ann.

tit. 37, $ 50612) (West Supp. 1982). The definition of

“beer” only includes beverages “containing more than

three and two-tenths percent (3.2%) of alcohol by

weight. . . .” Okla.Stat.Ann. tit. 37, §506(3) (West

Supp.1982). Since beer can contain 3.2% alcohol or

less, the advertising of beer venerally is allowed. The ad-

vertising of wine and other alcoholic beverages within

the state, however, is prohibited.

The members of Telecasters rebroadcast network pro-

gramming that includes advertisements for wine. Al-

though such advertising is lawful where it originates,

and in most states where rebroadcast occurs, the mem-

bers of Telecasters are required to “block out” network

advertising of wine. If Telecasters’ members fail to do

so, or if they solicit or accept advertisements for alco-

holic beverages, they are subject to criminal prosecution

by complaint of the Alcoholic Beverage Control Board.

The cable operators also are prohibited from soliciting

or accepting advertising for alcoholic beverages. For

many years, however, the cable operators have been al-

lowed to relay programming from out-of-state television

Stations that included advertisements for wine. In fact,

Federal Communication Commission regulations and fed-

eral copyright law prohibit cable operators from alter-

ing or modifying the television signals, including adver-

tisements, they relay to subscribers. See 17 U.S.C. $111

(ec! (3) (1976) and 47 C.F.R. $ 76.55(b) (1981). De-

spite those federal requirements, the Attorney General of

the state of Oklahoma on May 19, 1980, issued an opin-

ion declaring that the prohibitions against alcoholic bev-

erage advertising apply to cable television in the same

manner as they apply to broadcast television. Pursuant

to that opinion, Crisp notified the cable operators that

the wine commercials they had been relaying were il-

legal, and threatened the operators with criminal prose-

cution if they continued to relay such commercials.

Telecasters and the cable operators filed separate suits

against Crisp, in his official capacity, in the United

States District Court for the Western District of Okla-

homa. Pursuant to 28 U.S.C. § 2201 (Supp. IV 1980),

both plaintiffs asked the court to render a declaratory

judgment that Oklahoma’s laws, Okla. Const., art.

XXVII, $ 5, and Okla.Stat.Ann. tit. 37, § 516, supra, vio-

‘ated their rights to free speech, guaranteed by the First

and Fourteenth Amendments, and equal protection, guar-

anteed by the Fourteenth Amendment.' In addition, the

cable operators requested and received a preliminary in-

junction, and both plaintiffs sought permanent injunc-

tions, prohibiting Crisp from enforcing the constitutional

and statutory prohibitions against them.

Both the cable operators and Telecasters filed mo-

tions for summary judgment under Fed.R.Civ.P. 56.

Crisp filed motions to dismiss pursuant to Fed.R.Civ.P.

12/b) 16). On December 18, 1981, the district court filed

nearly identical memorandum opinions and orders in the

two cases, granting Telecasters’ and the cable operators’

motions for summary judgment, and denying Crisp’s

motions to dismiss.

In both opinions the district court ruled that the

power to regulate liquor granted to the states by the

Twenty-first Amendment to the United States Constitu-

tion did not override the First Amendment rights of Tele-

casters and the cable operators. The court then applied

the four part analysis the Supreme Court prescribed in

Centra! Hudson Gas and Blectric Corp. v. Public Service

Commission, 447 U.S. 557, 100 S.Ct. 2343. 65 L.Ed.2d

341 (1980), for determining the validity of the regula-

tion of “commercial speech”. That analysis can be sum-

marized as follows: (1) is the commercial speech pro-

tected by the First Amendment: that is, does it con-

cern lawful activity and is it not misleading; (2) is the

asserted governmental interest substantial: (3) does

the regulation directly advance the governmental inter-

est asserted: (4) is the regulation more extensive than

' The equal protection claim was based on the inconsistency be-

tween the treatment of the broadcast versus the printed media:

newspapers and magazines published outside of Oklahoma. but cir-

culated within the state, are permitted to carry advertisements of

alcoholic beverages. The trial court did not reach the issue of equal

protection and it is not before us in these appeals.

is necessary to serve the governmental interest? Jd. at

566, 100 S.Ct. at 2351.

The district court concluded that Oklahoma's laws

only indirectly advanced the stated governmental inter-

est in reducing alcohol consumption and its related prob-

lems, and were more extensive than necessary to serve

that interest. The court therefore entered declaratory

judgments stating that enforcement of the advertising

does or would violate the plaintiffs’ First Amendment

rights, as guaranteed by the Fourteenth Amendment.

The court also entered permanent injunctions against

Crisp, preventing him, or the Alcoholic Beverage Con-

trol Board, from enforcing the laws against the plaintiffs.

On January 11, 1982, Crisp timely filed a notice of ap-

peal with this court. On February 10, 1982, the district

court entered an order withdrawing its December 18,

1981, opinions, and filed nune pro tune memorandum

opinions in lieu thereof, supplementing and amplifying

its views with respect to the granting of summary judg-

ments. The substituted opinions did not alter the court’s

reasoning or conclusions in any material way; the De-

cember and February opinions are nearly identical.

Crisp moved to strike the substituted opinions. The dis-

trict court overruled the motion in Cablecom, but en-

tered no order in Telecasters,

Crisp then moved the trial court to stay the permanent

injunctions pursuant to Fed.R.Civ.P. 62(c). The trial

court denied the motion on May 19, 1982. On October 4.

1982, the Supreme Court dismissed for want of a sub-

stantial federal question the appeal in Queensgate In-

restment Co. v. Liquor Control Commission. US.

——, 103 S.Ct. 31, 74 L.Ed.2d 45 (1982). In that case

the Ohio Supreme Court had upheld against a First

Amendment challenge a state regulation which prohibited

retail liquor permit holders from advertising the retail

price of alcoholic beverages.

Based on the Queensgate dismissal, Crisp on Novem-

ber 4, 1982, again moved the district court to suspend

the injunctions under Fed.R.Civ.P. 62(¢c!}. The district

court was unable to hear the motions prior to November

15, when the appeals were scheduled for oral argument.

On November 9, therefore, Crisp applied to this court

under Fed.R.App.P. 8(a) for an order suspending the

injunctions during the pendency of the appeals. At the

commencement of oral argument on November 15, 1982,

we denied that application.

In his briefs, Crisp raises numerous contentions of

error, including the propriety of the trial court’s sum-

mary judgments and nunc pro tune opinions, the denial

of Crisp’s request for a hearing on his motion to stay

the injunctions, and the trial court’s application of the

Central Hudson analysis. At oral argument, however,

Crisp emphasized the importance of the Queensgate dis-

missal. We agree that the application of that case is the

critical issue in this appeal. Thus, we will first address

that issue.

In Queensgate Investment Co. v. Liquor Control Com-

mission, 69 Ohio St.2d 361, 433 N.E.2d 138 (1982), the

appellant, Queensgate Investment Co. ‘ Queensgate), was

a holder of an Ohio liquor permit who was prosecuted for

the violation of certain regulations of the Ohio Liquor -

Control Commission. The regulations in question pro-

hibited off-premises price advertising by holders of cer-

tain liquor permits. The Commission rendered an order

~The regulations provided, in pertinent part:

No alcoholic beverages shall be advertised in Ohio except in

the manner set forth in 4301:1-1-03 and as hereinafter pro-

vided.

(A) As to advertising on the premises, holders of Class C,

1D), and G permits shall not advertise the price per bottle or

drink of any alcoholic beverage, or in any manner refer to price

suspending Queensgate’s license for one week for the vio-

lation of the regulation. Queensgate appealed on several

grounds, including a contention that the regulation was

an unconstitutional restraint on its First Amendment

right to engage in commercial speech.

The Ohio Supreme Court applied the analysis articu-

lated in Central Hudson, supra, and held that the regula-

tion did not violate the First Amendment. The court first

held that the speech was protected and that the asserted

governmental interest, that of Ciscouraging the excessive

consumption of alcoholic beverages, was substantial and

was well within the powers granted to the states under

the Twenty-first Amendment. The court then held that

since it was directed at controlling alcoholic beverages,

not speech, the regulation did directly advance the gov-

ernmental interest. Finally, the court held that the ad-

vertising of drink prices and price advantages would en-

courage the excessive consumption of alcoholic beverages ;

thus, the prohibition against such advertising was the

narrowest method available to prevent such excessive con-

sumption. Queensgate, supra at 69 Ohio St.2d 365-67, 433

N.E.2d 138.

or price advantage except within their premises and in a man-

ner not visible from the outside of said premises.

(B) Manufacturers and distributors of alcoholic beverages

are permitted to advertise their products in Ohio.

Holders of Class C, D, and G permits shall be authorized to

advertise in newspapers of general circulation, radio and tele-

vision, on bill boards, calendars, in or on public conveyances

and in regularly published magazines. Advertising may include

the retail price of the original container or packages, but such

advertising may not in any manner refer to price advantage.

Subsequent enactment of law by the 102nd Ohio General

Assembly prohibits the advertising of the retail price of beer

in any media. See page 6, Section 4301.211 of the Revised Code

of Ohio.

Ohio Adm. Code 4301:1-1-44. See Queensgate, supra at 69 Ohio

St.2d 361-62 n. 1, 433 N.E.2d 138.

Queensgate filed a timely appeal in the United States

Supreme Court. The only issue it raised there was

whether the regulation violated the “First and Four-

teenth Amendments of the Constitution of the United

States by suppressing the public dissemination of truth-

ful information about a lawful activity.” Jurisdictional

Statement at I, Queensgate Investment Co. v. Liquor Con-

trol Commission, US. , 103 S.Ct. 31, 74 L.Ed.2d

45. The Liquor Control Commission filed with the Su-

preme Court a motion to dismiss the appeal on the ground

that the question was so unsubstantial as not to warrant

further argument. The basis for the motion was that an

advertising prohibition was well within the scope of a

State’s powers under the Twenty-first Amendment, which

permits a state to totally ban the sale of liquor, or other-

wise “minimize its evils’.

On October 4, 1982, the Supreme Court dismissed the

appeal “for want of a substantial federal] question.” *

Queensgate Investment Co. v. Liquor Control Com mission,

US. , 103 S.Ct. 31, 74 L.Ed.2d 45 (1982).

Thus, we must now determine what precedential weight

to ascribe to that dismissal in deciding the present appeal.

II,

The seminal case on the precedential effect of sum-

mary dispositions by the Supreme Court is Hicks ». Mi-

randa, 422 U.S. 332, 95 S.Ct. 2281, 45 L.Ed2a 223

(1975). In that case the Court was faced with the prob-

lem of the distinction between its appellate jurisdiction

and its certiorari jurisdiction. Under 28 U.S.C. $ 1257

* The rules of the Supreme Court require a jurisdictional state-

ment which includes “{a] statement of the reasons why the ques-

tions presented are so substantial as to require plenary considera-

tion, with briefs on the merits and oral argument, for their resolu-

tion.” Sup.Ct.R. 15(1)(h). Rule 16 allows the appellee to file a

motion to dismiss an “appeal from a state court on the ground that

it does not present a substantial federal question. .. .” Sup.Ct.R.

16(1)(b).

10a

(2) (1976), final judgments of the highest court of a

state may be reviewed by the Supreme Court: “By ap-

peal, where is drawn in question the validity of a statute

of any state on the ground of its being repugnant to the

Constitution . . . of the United States, and the decision

is in favor of its validity.” Unlike certiorari jurisdic-

tion, which is discretionary, the Court’s appellate juris-

diction is mandatory. Hicks, supra at 344, 95 S.Ct. at

2289. Thus, when a case comes before it on appeal, the

Supreme Court is ‘not obligated to grant the case plenary

consideration but [it is] required to deal with its

merits.” Jd.

The Court in Hicks therefore ruled that a summary

dismissal of an appeal for want of a substantial federal

question is a decision on the merits of the case. Such a

summary disposition is binding on the lower federal

courts, at least where substantially similar issues are

presented, until doctrinal developments or direct decisions

by the Supreme Court indicate otherwise. Jd. at 344-45,

95 S.Ct. at 2289-90.

Although the Hicks decision has been criticized for a

variety of reasons,° since that decision the Supreme Court

* See also Sup.Ct.R. 17(1) (“A review on a writ of certiorari is

not a matter of right, but of judicial discretion ...); 16 Wright,

Miller, Cooper & Gressman, Federal Practice and Procedure $$ 4003,

4004 & 4011 (1977).

* Mr. Justice Brennan has criticized the rule as giving too much

weight to a summary decision made solely on a jurisdictional state-

ment, for a variety of reasons which are not explained in any sort

of opinion. See Sidle v. Majors, 429 U.S. 945, 97 S.Ct. 366. 50

L.Ed.2d 316 (1976) (Brennan, J., dissenting from denial of cer-

tiorari) ; Colorado Springs An isements, Ltd. v. Rizzo, 428 U.S. 913.

96 S.Ct. 3228, 49 L.Ed.2d 1222 (1976) (Brennan, J., dissenting from

denial of certiorari). Sitting by designation in the Fourth Circuit.

Justice Clark stated that the Hicks rule ‘fl’ ew! in the face” of what

he perceived to be the Court’s actual practice of according similar

treatment and precedential weight to appeals from state courts and

petitions for certiorari. 526 F.2d 833, 836 (4th Cir. 1975) (Clark, J.,

concurring), cert. denied, 428 U.S. 913, 96 S.Ct. 3228, 49 L.Ed.2d

1221 (1976).

lla

has consistently stated that summary dispositions—sum-

mary affirmances and summary dismissals for want of a

substantial federal question—are decisions on the merits

and are binding on the lower federal courts." The Court

has refined the rule by emphasizing that a summary dis-

position only upholds the judgment of the lower court;

“[i]t does not... necessarily reflect [the Court’s] agree-

ment with the opinion of the court whose judgment is

appealed.” Washington v. Confederated Bands and Tribes

of the Yakima Indian Nation, 489 U.S. 463, 477 n. 20,

99 S.Ct. 740, 749 n. 20, 58 L.Ed.2d 740 (1979): See also

Illinois State Board of Elections v. Socialist Workers

Party, 440 U.S. 173, 182-88, 99 S.Ct. 983. 989-90, 49

L.Ed.2d 230 (1979): Mandel v. Bradley, 482 U.S. 173.

176, 97 S.Ct. 2238, 2240, 53 L.Ed.2d 199 (1977) (per

curiam},

It has also become clear that while summary disposi-

tions are rulings on the merits, their precedential effect

is limited to the precise issues set forth in the jurisdic-

tional statement:

Summary affirmances and dismissals for want of

a substantial federal question without doubt reject

the specific challenges presented in the statement of

jurisdiction and do leave undisturbed the judgment

appealed from. They do prevent lower courts from

coming to opposite conclusions on the precise issues

presented and necessarily decided by those actions. .. .

* See Metromedia, Inc. v. City of San Diego, 453 U.S. 490, 499-

900, 101 S.Ct. 2882, 2888-2889, 69 L.Ed.2d 800 (1981) (plurality

opinion); Southern Railway Co. v. Seaboard Allied Milling Corp.,

442 U.S. 444, 462, 99 S.Ct. 2388, 2398, 60 L.Ed.2d 1017 (1979):

Caban v. Mohammed, 441 U.S. 380, 390 n. 9, 99 S.Ct. 1760, 1767 n. 9,

60 L.Ed.2d 297 (1979): Washington v. Confederated Bands and

Tribes of the Yakima Indian Nation, 439 U.S. 463, 477 n. 20, 99

S.Ct. 740, 749 n. 20, 58 L.Ed.2d 740 (1979): Mandel v. Bradley, 432

U.S. 173, 176, 97 S.Ct. 2238, 2240, 53 L.Ed.2d 199 (1977) (per

curiam); Tully v. Griffin. Inc., 429 U.S. 68. 74, 97 S.Ct. 219, 203.

50 L.Ed.2d 227 (1976).

12:

Summary actions, however, . . . should not be un-

derstood as breaking new ground but as applying

principles established by prior decisions to the par-

ticular facts involved.

Mandel, supra at 176, 97 S.Ct. at 2240. See also Metro-

media, Inc. v. City of San Diego, 453 U.S. 490, 499, 101

S.Ct. 2882, 2887, 69 L.Ed.2d 800 (1981); Illinois State

Board of Elections, supra 440 U.S. at 182-83, 99 S.Ct.

at 989-90: Yakima Indian Nation, supra 439 U.S. at 477

n. 20, 99 S.Ct. at 749. Moreover, although lower federal

courts are bound by summary dismissals, they carry less

precedential weight in the Supreme Court than opinions

rendered after plenary consideration by that Court.

Metromedia, supra 453 U.S. at 500, 101 S.Ct. at 2889:

Caban v. Mohammed, 441 U.S. 380, 390 n. 9, 99 S.Ct.

1760, 1767 n. 9, 60 L.Ed.2d 297 (1979); Yakima Indian

Nation, supra 439 U.S. at 477 n. 20, 99 S.Ct. at 749

n. 20; Tully v. Griffin, Inc., 429 U.S. 68, 74-75, 97 S.Ct.

219, 223-224, 50 L.Ed.2d 227 (1976). In fact, “[i]t is

not at all unusual for the Court to find it appropriate

to give full ccnsideration to a question that has been the

subject of previous summary action.” Yakima Indian

Nation, supra 439 U.S. at 477 n. 20, 99 S.Ct. at 749 n.

20. See, e.g., Caban, supra 441 U.S. at 390 n. 9, 99 S.Ct.

at 1767 n. 9 ‘the Court gave plenary consideration to an

issue presented and summarily dismissed only three years

before and reversed itself).

This review of the Hicks rule provides some guidance

in determining the precedential weight we should give to

the summary dismissal of Queensgate. To the extent

that the same constitutional issues are presented in this

case as were presented in Queensgate, that decision is

binding, though the reasoning of the Ohio Supreme Court

may not be. In his concurring opinion in Mandel, Mr.

Justice Brennan suggested that in determining the reach

of a summary dismissal as precedent, a court must: “(a)

examine the jurisdictional statement in the earlier case

18a

to be certain that the constitutional questions presented

Were the same and, if they were, (bi) determine that the

judgment in fact rests upon decision of those questions

and not even arguably upon some alternative nonconsti-

tutional ground.” Mandel, supra 432 U.S. at 180, 97

S.Ct. at 2242 (Brennan. J.. concurring). These guide-

lines have been used by other courts. See Socialist Work-

ers Party v. March Fong Eu, 591 F.2d 1252, 1257-58

(9th Cir.), cert. denied, 441 U.S. 946. 99 S.Ct. 2167, 60

L.Ed.2d 1049 (1979): Lecates v. Justice of the Peace

Court No. 4, 637 F.2d 898, 904-05 (3d Cir. 1980). We

consider them to be appropriate here.

ITI.

The jurisdictional statement in Queensgate presented

the following question to the Supreme Court:

Whether Regulation 4301:1-1-44 of the Ohio

Liquor Control Commission, which prohibits a duly

licensed retail liquor permit holder from advertising

the retail price of alcoholic beverages in any medium

vigible from outside the permit premises, violates the

First and Fourteenth Amendments of the Constitu-

tion of the United States by suppressing the public

dissemination of truthful information about a law-

ful activity.

Jurisdictional Statement at I. Queensgate, U.S.

~~, 10o OO di, 74 LEG Sd 46 th support of the

proposition that the question was a substantial one, the

appellant in Queensgate argued that the advertising in

question was protected commercial speech, that the

Twenty-First Amendment did not allow a state to in-

fringe on protected commercial] speech, and that the regu-

lation in question was an unconstitutional infringement

on its First Amendment rights when analyzed under the

four-part Central Hudson test.

In the instant case, the issue is substantially similar.

In essence, that issue is: is Oklahoma’s advertising pro-

l4a

hibition an unconstitutional infringement on protected

commercial speech? Implicit in that issue, as we believe

Was implicit in Queensgate, is the issue of whether the

Twenty-first Amendment in some way enhances a state’s

authority to regulate commercial speech concerning al-

coholic beverages. To be sure, there are factual distinc-

tions between Queensgate and the instant case: the regu-

lated parties here are television stations, not liquor per-

mit holders; the laws here prohibit the rebroadecasting of

all advertising of alcoholic beverages, except for beer ad-

vertising, while the regulation in Queensgate prevented

only off-premises price advertising; and other minor dis-

tinctions. The crucial similarity between the cases, how-

ever, is this: in both cases, the state, acting under its

powers granted by the Twenty-first Amendment, has

chosen to prohibit some, but not all, forms of liquor ad-

vertising with the goal of decreasing the consumption

and abuse of alcoholic beverages. We are confident that

the constitutional question presented in Queensgate and

in the present appeals is substantially the same.

The second inquiry is whether there are any nonconsti-

tutional grounds upon which the Supreme Court may

have decided Queensyate. As noted above, the appellant's

jurisdictional statement in Queensgate, while minimizing

the effect of the Twenty-first Amendment, clearly con-

centrated on the argument that the regulation there vio-

lated its First Amendment rights to commercial speech.

In its motion to dismiss for want of a substantial federal

question, the Ohio Liquor Control Commission relied

solely on the argument that the state was free to regu-

late liquor advertising as part of its broad Twenty-first

Amendment power to regulate liquor and minimize its

evils. In our view, Queensgate manifestly presented an

issue concerning the tension between the First and

Twenty-first Amendments. The Supreme Court arguably

may have decided the case on nonconstitutional grounds;

if so, however, we cannot discern them. It is our view

15a

that the Supreme Court decided Ohio’s regulation was

nov an unconstitutional infringement on the appellant’s

First Amendment rights. The Queensgate dismissal is

binding on this court.

IV.

Still, the Supreme Court has warned against courts

being so preoccupied with a summary dismissal that

they fail “to undertake an independent examination of

the merits.” Mandel, supra 432 U.S. at ivi, 97 S.Ct. at

2241. In light of that Warning, and because the laws

here in question are indeed broader than the regulation

in Queensgate, we will follow the approach taken by the

court in Plante ». Gonzalez, 575 F.2d 1119 (oth Cir.

1978). cert. denied, 489 U.S. 1129. 99 S.Ct. 1047, 59

L.Ed.2d 90 (1979): ie. Queensgate will “eaution us”

against finding Oklahoma's laws to be unconstitutional,

but we must still examine the merits of these appeals.

Id. at 1125-26. In understanding this examination. we

are mindful that Queensgate “broke no new ground”,

and that we cannot reach an opposite conclusion ‘“‘on the

precise issues presented and necessarily decided by”

Queensgate. Mandel, supra 432 U.S. at 16, 97 S.Ct. at

2241.

The crucial question in this case, as it was under our

interpretation of Queensgate, is whether Oklahoma’s pro-

hibition against advertising of aleoholie beverages, as ap-

plied to the Appellees, violates their First Amendment

rights, as guaranteed by the Fourteenth Amendment.

The resolution of this issue involves an examination of

the relative interests at stake: that is, we must balance

the right of Telecasters and the cable operators to en-

gage in commercial speech against the right of Oklahoma,

through its general police powers as enhanced by the

Twenty-first Amendment. to regulate commercial speech

relating to alcoholic beverages.

The relevant section of the Twenty-first Amendment

states: “The transportation or importation into any State

Territory, or possession of the United States for delivery

l6a

or use therein of intoxicating liquors, in violation of the

laws thereof, is hereby prohibited.” U.S. Const., amend.

XXI, $ 2. While the states have broad authority to regu-

late alcoholic beverages under their traditional police

powers standing alone, Wisconsin v. Constantineau, 400

U.S. 433, 436, 91 S.Ct. 507, 509, 27 L.Ed.2d 515 (1971),

“the broad sweep of the Twenty-first Amendment has

been recognized as conferring something more than the

normal state authority over public health, welfare, and

morals.” California v. LaRue, 409 U.S. 109, 114, 93 S.Ct.

390, 395, 34 L.Ed.2d 342 (1972). Thus, under the

Twenty-first Amendment, the states have the power to

prohibit totally the sale of liquor within their boundaries,

New York State Liquor Authority v. Bellanca, 452 U.S.

714, 715, 101 S.Ct. 2599, 2600, 69 L.Ed.2d 357 (1981)

(per curiam) ; Ziffrin, Inc. v. Reeves, 308 U.S. 132, 138,

60 S.Ct. 163, 167, 84 L.Ed. 128 (1939), and the con-

comitant power to regulate the times, places, and circum-

stances under which liquor may be sold. Bellanca, supra,

452 U.S. at 715, 101 S.Ct. at 2600. Moreover, within the

power conferred by the Twenty-first Amendment, a “State

may protect her people against evil incident to intoxicants

... and may exercise large discretion as to means em-

ployed.” Ziffrin, supra 308 U.S. at 138-39, 60 S.Ct. at

167.

On two separate grounds, therefore, we hold that Okla-

homa’s alcoholic beverage advertising prohibitions are an

exercise of authority within that granted by the Twenty-

first Amendment. First, the purpose of the advertising

here unquestionably is to encourage sales of alcoholic

beverages. As such, the advertising could be considered

an incident of the sale of liquor which the state may

regulate as it regulates sales themselves: “{t]he prohibi-

tion against certain forms of advertising is really a pro-

hibition against soliciting of business.” Premier-Pabst

Sales Co. v. State Board of Equalization, 13 F.Supp. 90,

96 (S.D.Cal.1935). Alternatively, the laws are justified

as one of the means, selected by an exercise of its broad

lva

discretion, by which Oklahoma has chosen to achieve the

proper goal of protecting its people against the harms

incident to the use of alcoholic beverages. Ziffrin, supra

308 U.S. at 138-39, 60 S.Ct. at 167. The latter justifica-

tion was the one the State of Ohio presented to the Su-

preme Court in Queensgate. Under either analysis, Okla-

homa’s liquor advertising laws are within its powers

under the Twenty-first Amendment. Accordingly, they

are entitled to the ‘ ‘added presumption in favor of the

validity of the state regulation’ conferred by the Twenty-

first Amendment.” Bellanca, supra 452 U.S. at 718, 101

S.Ct. at 2601 (quoting California v. LaRue, supra 409

US. at 118, 98 S.Ct. at 397).

The determination that Oklahoma's laws are within its

authority under the Twenty-first Amendment, however,

does not end our inquiry. The Twenty-first Amendment

did not grant to the states the authority to abrogate in-

dividual rights guaranteed by the Fourteenth Amend-

ment. Craig v. Boren, 429 U.S. 190. 206-09, 97 S.Ct.

451, 461-63, 50 L.Ed.2d 397 (1976): Wisconsin v. Con-

stantincau, supra 400 U.S. at 486, 91 S.Ct. at 509

(1971). A state’s power under the Twenty-first Amend-

ment must be considered in the light of the other pro-

visions of the Constitution “in the context of the issues

and interests at stake in any concrete case.” Hostetter

". Idlewild Bon Voyage Liquor Corp., 377 U.S. 324. 332,

84 S.Ct. 1293, 1298, 12 L.Ed.2d 350 (1964).

In this case, then, we must consider the Twenty-first

Amendment in the light of the First Amendment. There

is no serious dispute that the advertising here in ques-

tion is commercial speech, entitled to some degree of

protection under the First and Fourteenth Amendments.’

‘Crisp belatedly argues that the advertisements here are “in-

herently misleading” and therefore properly prohibited. See In re

18a

Virginia State Board of Pharmacy v. Virginia Citizens

Consumer Council, Inc., 425 U.S. 748, 96 S.Ct. 1817,

48 L.Ed.2d 346 (1976); Bates v. State Bar, 433 U.S. 350,

97 S.Ct. 2691, 53 L.Ed.2d 810 (1977); Linmark Associ-

ates, Inc. v. Township of Willingboro, 431 U.S. 85, 97

S.Ct. 1614, 52 L.Ed.2d 155 (1977). In interpreting the

scope of protection afforded by the First Amendment,

however, there is a “common-sense and legal distinction

between speech proposing a commercial transaction and

other varieties of speech... .”’ Metromedia, Inc. v. City

of San Diego, 453 U.S. 490, 506, 101 S.Ct. 2882, 2891,

69 L.Ed.2d 800 (1981) (plurality opinion).. Rather than

dilute the First Amendment, the Supreme Court has

“afforded commercial speech a limited measure of pro-

tection, commensurate with its subordinate position in

the scale of First Amendment values, while allowing

modes of regulation that might be impermissible in the

realm of noncommercial expression.”” Ohralik v. Ohio

State Bar Association, 436 U.S. 477, 456, 98 S.Ct. 1912,

1918, 56 L.Ed.2d 444 (1978).

Our duty here is to determine whether Oklahoma’s

laws are a permissible regulation of the Appellee’s at-

tenuated First Amendment rights. In doing so, we must

bear in mind that the Supreme Court allowed substan-

tially similar regulations, despite similar challenges, in

Queensgate. Nevertheless, in view of the holding in Craig

R.M.J., 455 U.S. 191, 202, 102 S.Ct. 929, 937, 71 L.Ed.2d 64; Fried-

man v. Rogers, 440 U.S. 1, 15-16, 99 S.Ct. 887, 897, 59 L.Ed.2d 100

(1979); Ohralik v. Ohio State Bar Association, 486 U.S. 447, 462,

98 S.Ct. 1912, 1921, 56 L.Ed.2d 444 (1978). Irrespective of whether

that argument is properly before us, it is clear that Oklahoma's laws

are not aimed at preventing deceptive or misleading advertising.

Indeed, if they were, they would be in danger of being struck down

as being more extensive than reasonably necessary. See, e.g., /n re

R.M.J., supra 455 U.S. at 207, 102 S.Ct. at 940. The purpose of

Oklahoma's laws is to prevent the excessive consumption of alcohol.

For purposes of determining the constitutionality of the laws in

that context, we are willing to accept the trial coort's finding that

the advertising is truthful.

19a

v. Boren, supra 429 U.S. at 209, 97 S.Ct. at 463, that the

Twenty-first Amendment does not alter the standards

otherwise applicable in equal protection cases, we will

apply the analysis for determining the validity of regu-

lation of commercial speech articulated by the Supreme

Court in Central Hudson Gas & Electric C orp. v. Public

Service Commission, 447 U.S. 557, 100 S.Ct 2343, 65

L.Ed.2d 341 (1980).

In Central Hudson, the Court reiterated that com-

mercial speech is accorded lesser protection under the

Constitution than other forms of constitutionally pro-

tected expression. Central Hudson, supra at 563, 100

S.Ct. at 2350 (citing Ohralik, supra 436 U.S. at 457, 98

S.Ct. at 1919). According to the Court. the “protection

available for particular commercia] expression turns on

the nature both of the expression and of the govern-

mental interests served by its regulation.” Central

Hudson, supra 447 U.S. at 563, 100 S.Ct. at 2350. In

order to balance those two competing interests, the Court

proposed the following four-part analysis:

At the outset, we must determine whether the ex-

pression is protected by the First Amendment. F or

commercial speech to come within that provision, it

at least must concern lawful activity and not be mis-

leading. Next, we ask whether the asserted govern-

mental] interest is substantial. If both inquiries yield

positive answers, we must determine whether the

regulation directly advances the governmental in-

terest asserted, and whether it is not more extensive

than necessary to serve that interest.

Central Hudson, supra at 566, 100 S.Ct. at 2351.

The threshold presented by the first two steps is easily

crossed. In all relevant respects, the commercial speech

here in question concerns lawful activity. The sale and

consumption of alcoholic beverages, though heavily regu-

20a

lated, is lawful within the State of Oklahoma.* Nor,

despite Crisp’s allegations, are the advertisements in-

herently misleading.’ The commercia] speech here is pro-

tected speech under the First Amendment. See Virginia

Board of Pharmacy, supra.

The asserted governmental interest of Oklahoma in

prohibiting the advertising of alcoholic beverages is to

reduce the sale and consumption of liquor, and thereby

reduce the problems associated with alcoho] abuse. There

can be no question that this asserted interest is substan-

tial. Under its general police power, Oklahoma has a

legitimate and substantial interest in the health and wel-

fare of its citizens, the safety of its highways, the sta-

bility of its families, and the productivity of its work

force, all of which are significantly and adversely affected

by the abuse of alcohol. Added to this already substan-

tial interest is the power of Oklahoma under the Twenty-

‘Crisp argues that some of the advertising displays conduct

which would be unlawful in Oklahoma. First, we do not consider it

significant that a nationally broadcast advertisement may show

conduct, such as drinking wine in public, which is unlawful in

Oklahoma. The purpose of the advertisement is to sell wine, which

may be done lawfully in Oklahoma, not to encourage public drinking

in violation of the laws of Oklahoma. Secondly, if Oklahoma's true

purpose were to prevent only such advertising, the laws again are

far more extensive than necessary.

* See footnote 7, supra. Indeed, the qualities that Crisp alleges

make these wine commercials “inherently misleading”—the com-

mercials tend to project an image of wine drinkers as successful,

fun-loving people, without warning of the dangers of alcohol—are

present in the advertising of almost any product from automobiles

to snack foods. The Supreme Court’s concern with “inherently mis-

leading” advertising is directed towards advertising methods which

tend to encourage fraud, overreaching, or confusion, such as some

forms of lawyer solicitation. See Ohralik, supra 436 U.S. at 462, 98

S.Ct. at 1921. As to advertising in general, the Supreme Court has

rejected a paternalistic approach in favor of assuming “that people

will perceive their own best interests ...” if the channels of com-

munication are left open. Virginia State Board of Pharmacy, supra

425 U.S. at 770, 96 S.Ct. at 1829.

Zla

first Amendment to regulate the sale, and the incidents

thereof, of alcoholic beverages, and to protect its citizens

from the evils incident to alcohol. See Ziffrin, supra 308

U.S. at 138-39, 60 S.Ct. at 167. The asserted state in-

terest, therefore, is exceptionally strong.

We must determine whether Oklahoma's laws directly

advance its asserted governmental interest. The trial

court found that the laws are at best an indirect means

of advancing Oklahoma’s interest. In particular, the

court noted that other means, such as early and con-

tinuing education about the dangers of alcohol abuse,

were available. In our view, the trial court misconceived

the purpose of this inquiry. Central Hudson does not

require that we determine whether Oklahoma has chosen

the best means to advance its interest; rather the in-

quiry is whether the means chosen by the legislature,

however objectionable any court may find them, directly

advance the asserted state interest.

In undertaking this inquiry, we note the approach

taken by the plurality in Metromedia in applying the

third part of the Central Hudson test: ‘We likewise

hesitate to disagree with the accumulated, common-sense

judgments of local lawmakers and of the many review-

ing courts that billboards are real and substantial haz-

ards to traffic safety. There is nothing here to suggest

that these judgments are unreasonable.” Metromedia,

supra 453 U.S. at 509, 101 S.Ct. at 2893 (footnote

omitted). In that case, the appellants argued that there

was nothing in the record to show any connection be-

tween billboards, which San Diego had essentially pro-

hibited, and traffic safety, one of the asserted govern-

mental interests. The California Supreme Court had

held, nevertheless, that as a matter of law the ordinance

eliminating billboards was reasonably related to traffic

safety. Jd. at 508, 101 S.Ct. at 2893. The plurality

agreed with that holding. /d. at 509, 101 S.Ct. at 2893.

22a

In this appeal, the Appellees similarly argue, and the

trial court agreed, that the record does not demonstrate

that Oklahoma’s laws have any direct effect on the con-

sumption of alcohol. In light of the plurality’s language

in Metromedia, however, and particularly in light of the

additional deference owed to the legislature as a result

of the Twenty-tirst Amendment, Bellanca,'” supra, we

hold, as a matter of law, that prohibitions against the

advertising of alcoholic beverages are reasonably related

to reducing the sale and consumption of those beverages

and their attendant problems. The entire economy of the

industries that bring these challenges is based on the

belief that advertising increases sales. We therefore do

not believe that it is constitutionally unreasonabie for

the State of Oklahoma to believe that advertising will

not only increase sales of particular brands of alcoholic

beverages but also of alcoholic beverages generally. The

choice of the Oklahoma legislature, and its people with

respect to the constitutional provision, is not unreason-

able, and does directly advance Okiahoma’s interest in

reducing the sale, consumption, and abuse of alcoholic

beverages,

The final inquiry under the Central Hudson test is

whether Oklahoma's laws are more extensive than is

necessary to serve its interest. The trial court con-

'” The regulations in question in Bellanca prevented nude dancing

in establishments which sold liquor for on-premises consumption.

Despite the fact that the regulation played a differeni role in New

York's alcoholic beverage regulatory scheme than the laws here, we

find the following language instructive:

Whatever artistic or communicative value may xttach to topless

dancing is overcome by the State’s exercise of its broad powers

arising under the Twenty-first Amendment. Although some

may quarrel with the wisdom of such legislation and may con-

sider topless dancing a harmless diversion, the Twenty-first

Amendment makes that a policy judgment for the state legis-

lature, not the courts.

Bellanca, supra 452 U.S. at 718, 101 S.Ct. at 2601.

23a

cluded, and Appellees urge, that since with respect to

Telecasters and the cable operators all rebroadcasting of

alcoholic beverage advertising was prohibited, the laws

were more extensive than necessary.

Again, the plurality opinion in Metromedia is in-

structive. In that case, San Diego's ordinance banned

virtually all billboards, allowing only on-site advertising

and other limited exceptions. According to the stipulated

facts in the case, the result of the ordinance was to

eliminate completely the outdoor advertising business in

San Diego. Metromedia, supra 453 U.S. at 497, 101

S.Ct. at 2887. Nevertheless, noting in particular that on-

site advertising and some other signs were specifically

exempted from the ordinance, the plurality held that the

ordinance was no broader than necessary. /d. at 508,

101 S.Ct. at 2893.

We recognize, of course, that the plurality eventually

did strike down the ordinance in Metromedia. It did so,

however, only on the grounds that the ordinance violated

the First Amendment protections for political and other

noncommercial speech. Metromedia, supra at 513-17,

101 S.Ct. at 2895-97. The plurality’s analysis clearly

distinguished between commercial and non-commercial

speech. With respect to the commercial speech aspect of

the case, the plurality applied the Central Hudson test

and found that the ordinance was constitutional. Metro-

media, supra at 507-09, 512, 101 S.Ct. at 2891-93, 2895.

It is our view, therefore, that Oklahoma’s laws also

pass the fourth and final test under Central Hudson.

Even though Appellees are completely prohibited from re-

broadcasting alcoholic beverage advertising, they are free

to carry other forms of advertising. We recognize that

the cable operators especially are placed in a difficult

position; however, nothing in the First Amendment pro-

hibits this result. See Metromedia, supra. On-premises

advertising is allowed, the rebroadcast of beer advertis-

ing is not prohibited, and alcoholic beverage advertising

24a

in out-of-state printed publications distributed in Okla-

homa is allowed. Although Appellees bear a dispropor-

tionate burden of the regulation, Oklahoma has not elimi-

nated the dissemination of information concerning alco-

holic beverages. With particular emphasis on the power

of Oklahoma under the Twenty-first Amendment, we hold

that the advertising prohibitions here are no more ex-

tensive than is necessary to serve Oklahoma’s asserted

interest. Article XXVII, $5, of the Oklahoma Constitu-

tion, and Section 516 of title 37 of the Oklahoma Stat-

utes, are valid restrictions on commercial speech and do

not violate the Appellees’ First Amendment rights.

We again emphasize that the Central Hudson test is

essentially a balancing test. When the Twenty-first

Amendment is considered in addition to Oklahoma’s sub-

stantial interest under its police power, the balance shifts

in the state’s favor, permiting regulation of commercial

speech that might not otherwise be permissible. We be-

lieve that the Supreme Court’s summary dismissal in

Queensgate mandates this result. We order that the

permanent injunctions be dissolved and we reverse the

district court’s summary declaratory judgments.

McKAY, Circuit Judge, concurring:

While I fully concur in the court’s opinion, I add this

concurring statement to bring out an additional serious

consequence of the alternative result. The section under

attack in these cases was enacted by a vote of the people

at large in a single referendum petition that included not

only the regulatory scheme but the surrender by repeal of

the Prohibition Ordinance, see Okla. Const., art. XXVII,

$$ 1-11 (1981) ‘each section composed part of State

Question No. 386, Referendum Petition No. 121 which

was adopted at election held Apri! 7, 1959!. which had

stood since statehood as the fundamental law of Oklahoma

separately voted on by the people at large. The regula-

tory package was clearly the quid pro quo for the sur-

25a

renver after decades of dispute of this long held public

standard. I have serious doubt that federal courts are

at liberty glibly to sever and strike down one section of

such an integrated state decision with its long and turbu-

lent history. see Spokane Arcades, Inc. v. Brockett, 631

F.2d 185 (9th Cir. 1980), afd, 454 U.S. 1022, 102 S.Ct.

997, 70 L.Ed.2d 468 (1981), reh’g denied, 454 U.S. 1165,

102 S.Ct. 1040, 71 L.Ed.2d 322 (1982), without strik-

ing down the whole and restoring the status quo ante

whether any of the parties would desire such a result.

26a

APPENDIX B

UNITED STATES COURT OF APPEALS

TENTH CIRCUIT

Before Honorable James E. Barrett, Honorable Monroe G.

McKay, and Honorable James K. Logan, Circuit Judges

No. 82-1061

CABLECOM-GENERAL, INC., Cox CABLE OF OKLAHOMA

CiTy, INC., MULTIMEDIA CABLEVISION, INC.. SAMMONS

COMMUNICATION, INC.,

Plaintiffs-A ppellees,

VS.

RICHARD A. CRISP, Director,

Alcohol Beverage Control Board,

Defendant-A ppellant,

SANE, INC., OKLAHOMA PRESS ASSOCIATION, OUTDOOR

ADVERTISING ASSOCIATION OF OKLAHOMA, STATE OF

MISSISSIPPI,

Amici Curiae.

This matter comes on for consideration of appellees’

petition for rehearing filed in the captioned cause.

Upon consideration whereof, the petition for rehearing

is denied.

s Howard K. Phillips

HOWARD K. PHILLIPS

Clerk

Date of Entry: March 21, 1983

27a

APPENDIX C

UNITED STATES COURT OF APPEALS

TENTH CIRCUIT

Before Honorable James E. Barrett, Honorable Monroe G.

McKay, and Honorable James K. Logan, Circuit Judges

No. 82-1061

CABLECOM-GENERAL. Inc., Cox CARE or OKLAHOMA

City, INc., MULTIMEDIA CABLEVISION, INC.. SAMMONS

COMMUNICATION, INC..

Plaintiffs-A ppellees,

RICHARD A. CRISP, Director.

Alcohol Beverage Control Board.

Defendant-A ppellant,

SANE, INC., OKLAHOMA PREss ASSOCIATION, OUTDOOR

ADVERTISING ASSOCIATION OF OKLAHOMA, STATE OF

MISSISSIPPI,

Amici Curiae.

This matter comes on for consideration of appellees’

motion for stay of mandate in the captioned cause pend-

ing application to the Supreme Court for certiorari.

Upon consideration whereof, it is ordered that the man-

date is stayed until May 4, 1983. pending certiorari and

that if, on or before that date. there is filed with the

Clerk of the Court of Appeals a notice from the Clerk

of the Supreme Court of the United States that appellees

have timely filed a petition for writ of certiorari in the

Supreme Court, the stay shall continue until final dis-

position by the Supreme Court.

s’ Howard K. Phillips

HowarD K. PHILLIPs

Clerk

Date of Entry: April 4, 1983

28a

APPENDIX D

IN THE UNITED STATES DISTRICT COURT

FOR THE WESTERN DISTRICT OF OKLAHOMA

No. CIV-81-290-W

CABLECOM-GENERAL, INC.; COX CABLE OF OKLAHOMA

City, INC.; MULTIMEDIA CABLEVISION, INC.; AND

SAMMONS COMMUNICATIONS, INC.,

Plaintiffs

RICHARD A. CRISP, DIRECTOR,

ALCOHOLIC BEVERAGE CONTROL BOARD,

Defendant.

PRELIMINARY INJUNCTION

This cause came on for hearing on March 6, 1981 on

plaintiffs’ Motion for Preliminary Injunction. All par-

ties appeared by counsel. The Court, having heard the

testimony of the witnesses and arqupent of counsel,

finds as follows:

1. This action is brought against the defendant in

his official capacity as the Director of the Alcoholic Bev-

erage Control Board of the State of Oklahoma. De-

fendant’s official duties include investigation of potential

violations of Alcoholic Beverage Laws and aiding pros-

ecution of violations. 37 O.S. $509. Oklahoma’s Aleco-

holic Beverage Laws include a prohibition against ad-

vertising alcoholic beverages.

2. Plaintiffs are operators of various cable television

systems throughout the State of Oklahoma. As part of

their programming, they relay to subscribers the signals

of out of state television stations, which signals include

commercials advertising alcoholic beverages. They seek

a declaration that enforcement of Oklahoma laws _ pro-

29a

hibiting advertisement of alcoholic beverages against

them would violate their rights under the United States

Constitution and an injunction prohibiting enforcement

aga’nst them.

3. Defendant has made known his intention to recom-

mend prosecution of plaintiffs if violations of the ad-

vertising prohibition are brought to his attention.

4. Plaintiffs’ uncontradicted testimony showed that at-

tempting to comply with the advertising prohibition

pending final hearing of this action would entail enor-

mous financial burden and would also. in many instances,

place them in violation of United States law.

5. In some instances, the signals containing the aleo-

holic beverage advertisements have been carried by cable

systems in the state for over ten years, without previous

challenge.

6. Plaintiffs are faced with a genuine threat that the

advertising prohibition will be enforced against them,

giving this Court jurisdiction to entertain this action.

7. Plaintiffs have demonstrated the probability that

they would suffer irreparable injury if defendant is not

enjoined from pursuing enforcement pending final hear-

ing of this action.

8. Plaintiffs have demonstrated a sufficient probability

of success to justify preliminary relief preserving the

Status quo, particularly in light of the absence of any

showing of injury-to defendant from the granting of

such relief.

IT IS THEREFORE ORDERED. that defendant, in

his official capacity, his agents, employees, attorneys, and

all persons in active concert or participation with him

are hereby enjoined pending determination of this ac-

tion from attempting to enforce or assisting or recom-

mending any attempted enforcement of Oklahoma law

30a

prohibiting advertisement of alcoholic beverages against

these plaintiffs.

LEE R. WEST

United States District Judge

Date of Entry: March 19, 1981

3la

APPENDIX E

IN THE UNITED STATES DISTRICT COURT

FOR THE WESTERN DISTRICT OF OKLAHOMA

CIV-81-290-W

CABLE-CoM GENERAL, INC.: Cox CABLE OF OKLAHOMA

City, INc.: MULTIMEDIA (ABLEVISION, INC.: SAMMONS

COMMUNICATION, INC..

Plaintiffs,

Vs.

RICHARD A. CRISP, Director, Alcoholic Beverage

Control Board,

Defendant.

DECLARATORY JUDGMENT

Pursuant to 28 U.S.C. § 2201, and in accordance with

the Memorandum Opinion entered herein this 18th day

of December, 1981,

IT IS HEREBY ORDERED, ADJUDGED AND DE-

CREED that enforcement of Article 27. § 5, of the Okla-

homa Constitution or 37 O.S. (1971) $516 by the

defendant, in his official capacity, his agents, employees,

attorneys, and all persons in active concert or participa-

tion with him, against the plaintiffs is or would be a

violation of Plaintiffs’ First Amendment rights under

the United States Constitution as guaranteed to the states

by the Fourteenth Amendment.

IT IS SO ORDERED this 18th day of December, 1981.

s Lee R. West

United States District Judge

Date of Entry: December 18, 1981

32a

APPENDIX F

IN THE UNITED STATES DISTRICT COURT

FOR THE WESTERN DISTRICT OF OKLAHOMA

CIV-81-290-W

CABLE-COM GENERAL, INC.; Cox CABLE OF OKLAHOMA

City, INcC.: MULTIMEDIA CABLEVISION, INC.; SAMMONS

COMMUNICATION, INC.,

Plaintiffs,

VS.

RICHARD A. CRISP, Director, Alcoholic Beverage

Control Board,

Defendant.

PERMANENT INJUNCTION

In accordance with the Memorandum Opinion and

Order entered herein this 18th day of December, 1981,

IT IS HEREBY ORDERED that Defendant, in his

official capacity, his agents employees, attorneys, and all

persons in active concert or participation with him, are

permanently enjoined from attempting to enforce or

assisting or recommending any attempted enforcement

of Article 27, $5, of the Oklahoma Constitution or 37

O.S. (1971) $516 against these plaintiffs.

IT IS SO ORDERED this 18th day of December, 1981.

s Lee R. West

United States District Judge

Date of Entry: December 18, 1981

33a

APPENDIX G

IN THE UNITED STATES DISTRICT COURT

FOR THE WESTERN DISTRICT OF OKLAHOMA

CIV-81-290-W

CABLE-COM GENERAL, INC.: Cox CABLE OF OKLAHOMA

City, INC.; MULTIMEDIA CABLEVISION, INC.: SAMMONS

COMMUNICATION, INC..

Plaintiffs,

VS.

RICHARD A, CRISP, Director,

Aleoholic Beverage Control Board,

Defendant.

Richard C. Ford and Clyde A. Muchmore, 1800 Mid-

America Tower, Oklahoma City, OK 73102, and Arthur

H. Harding, FLEISHMAN AND .WALSH, 1725 N_ Street,

N.W., Washington, D.C. 20036 for the plaintiff Cable-

Com General, Ine.

Marvin B. York and John W. Maile, BLEVINS & York,

1245 S.W. 44th St., Oklahoma City, OK 73109, and David

P. Fleming of Dow, LoHNES & ALBERTSON, 1225 Con-

necticut Ave., Washington, D.C, 20036 for the plaintiff

Cox Cable of Oklahoma City, Ine.

tobert Jernigan, 1200 N. Shartel, Oklahoma City, OK

73101, and David P. Fleming of Dow, LoHNES & AL-

BERTSON, 1225 Connecticut Ave.. Washington, D.C. 20036

for the plaintiff Multimedia Cablevision, Inc.

Jap W. Blankenship and Warren F. Bickford of

FeLLERS, SNipek, BLANKENSHIP, BaILey @ TIPPENs.

2400 First National Center, Oklahoma City, OK 73102

and David P. Fleming of Dow, LoHNES & ALBERTSON,

1225 Connecticut Ave.. Washington, D.C. 20036 for the

plaintiff Sammons Communication, Inc.

34a

Jan Eric Cartwright, Attorney General, and Michael

C. Conaway, Assistant Attorney General, 112 State Capi-

tol Building, Oklahoma City, OK 73105 for Defendant.

Jerry D. Sokolosky, 514 Park Harvey Center, 200

North Harvey, Oklahoma City, OK 73102 for Amicus

Curiae Oklahoma Press Association.

Larry Derryberry of DERRYBERRY, DUNCAN & NANCE,

4420 North Lincoln Boulevard, Oklahoma City, OK 73105

for Amicus Curiae S.A.N.E., Inc.

MEMORANDUM OPINION AND ORDER

Before the Honorable Lee R. West, United States

District Judge.

Introduction

Plaintiffs are corporations qualified to do business in

Oklahoma and are holders of cable television franchises

in the state of Oklahoma. They have franchises through-

out the state including operations in Canadian, Ottawa,

Oklahoma, Tulsa, Kiowa, Greer, and Noble Counties.

laintiffs relay to paid subscribers the signals of various

television stations, some of which originate outside

Oklahoma.

Defendant is the Director and Secretary to the Board

of the Alcoholic Beverage Control Board, an agency of

the State of Oklahoma charged with primary responsi-

bility for the enforcement of Oklahoma law relating to

alcoholic beverages. Director Crisp is sued only in his

official capacity.

Some of the programming which Plaintiffs relay to

their customers includes advertisements for wine. .an

alcoholic beverage as defined in Article 27, $5 of the

Oklahoma Constitution, and 37 O.S. £506 (1971). This

advertising is lawful where originated but prohibited in

ova

Oklahoma. Plaintiffs seek a declaratory judgment that,

as applied to Plaintiffs, the provisions of Oklahoma’s

Constitution and laws prohibiting advertisement of alco-

holic beverages violate Plaintiffs’ constitutional rights.

The case was filed on March 3, 1981, and on March 6,

1981, following an evidentiary hearing, the Court pre-

liminarily enjoined Defendant from attempting to en-

force the challenged provisions against Plaintiffs during

the pendency of this action. That injunction remains in

force and Plaintiffs seek to have it made permanent to

prohibit Defendant from attempting to enforce or assist-

ing any attempted enforcement as threatened against

Plaintiffs.

Plaintiffs have moved for summary judgment pursuant

to Rule 56, F.R.Civ.P., on the grounds that the consti-

tutional and statutory ban on advertising violates the

plaintiffs’ First Amendment right to freedom of speech.

Plaintiffs also contend the ban is a violation of Plaintiffs’

right to equal protection under the law. The Oklahoma

Press Association has filed an amicus curiae brief in |

support of Plaintiffs’ Motion for Summary Judgment.

Defendant has filed a Motion to Dismiss pursuant to

Rule 12(b) (6), F.R.Civ.P. Defendant contends that be-

cause the Twenty-first Amendment grants a broad sweep

of power to Defendant to regulate the liquor industry,

the passage of Okla. Const., art. 27, $5 and the enact-

ment of 37 O.S. $516 (1971) do not violate the freedom

of speech protection of the First Amendment. Defendant

further contends that no equal protection violation is

manifest in the laws in question because they bear a

rational relationship to the legitimate governmental goal

of protecting the health, safety, and welfare of the people

of Oklahoma. Defendant contends that quasi-judicial and

prosecutorial immunity of Richard A. Crisp bars a claim

under 42 U.S.C. § 1988. S.A.N.E. Ine. has filed an

amicus curiae brief in support of Defendant’s Motion to

Dismiss.

36a

District Court Jurisdiction

The plaintiffs invoke the jurisdiction of this Court pur-

suant to 28 U.S.C. $§ 1831, 1348, 2201. and 42 U.S.C.

$1983. Defendant in its answer denies jurisdiction,

claiming that the Court should abstain because no fed-

eral question is presented and because the Supreme Court

of Oklahoma has ruled upon the questions presented here

and has declared the constitutional provisions and statute

in question to be constitutionally valid.

Defendant does not address these jurisdictional issues

in its brief in support of its Motion to Dismiss other

than to assert that Defendant is immune from suit

pursuant to 42 U.S.C. $ 1983 because of the doctrine

of quasi-judicial and prosecutoria] immunity. Neverthe-

less, the Court is aware of Defendant’s position and au-

thorities from contentions in other briefs and oral argu-

ments presented to the Court. Accordingly, the Court

has considered the threshold issue of jurisdiction.

Title 28 U.S.C. § 1343 provides in relevant part:

The district court shall have original jurisdiction

of any civil action authorized by law to be com-

menced by any person:

* * * >

(3) To redress the deprivation under color of

any ... Statute, ordinance .. . of any right, privi-

lege or immunity secured by the Constitution of

the United States, ....

(4) To recover damages or to secure equitable or

other relief under any Act of Congress providing

for the protection of civil rights . .

Title 42 U.S.C. § 1983 provides in relevant part:

Every person who, under color of any statute, ordi-

nance ... of any state . . . subjects or causes to

be subjected, any citizen of the United States . .

to the deprivation of any rights, privileges, or im-

37a

munities secured by the Constitution and laws, shall

be liable to the party injured in an action at law,

suit in equity, or other proper proceeding for re-

dress.

The doctrine of quasi-judicial or prosecutorial immunity

might be relevant if this were a suit for damages pur-

suant to 42 U.S.C. § 1983; however, Defendant cites no

authority in support of application of the doctrine to a

suit such as this one for declaratory or injunctive relief.

Neither section 1983 itself nor the Eleventh Amendment

presents a bar to a suit for prospective injunctive relief

against a state officia] acting in his official capacity. See,

Acha v. Beame, 438 F. Supp. 70, 77 (S.D. N.Y. 1977),

affd, 570 F.2d 57 (1978), and cases cited therein,

The federal court has a duty to give due respect to a

suitor’s choice of a federal forum for the hearing and

decision of his federal constitutional claims. Zwickler v.

Koota, 389 U.S. 241 (1967).

The Court is not called upon to give relief that may

relate in any way to a pending state criminal proceed-

ing. Accordingly, the type of abstention called for by

Younger v. Harris, 401 U.S. 37 (1971), would not be

appropriate. Neither is the Court dealing with an am-

biguous state statute which might require abstention

under the Pullman Doctrine. Railroad Commission of

Texas v. Pullman Co., 312 U.S. 496 (1941). See gen-

erally, Wright, Miller & Cooper, Federal Practice and

Procedure: Jurisdiction § 4242 at 456.

Furthermore, the issues before this Court have not

been decided by the Oklahoma Supreme Court. In Okla-

homa Alcoholic Beverage Control Board v. Heublein

Wines International, 566 P.2d 1158 (Okla. 1977), the

Oklahoma Supreme Court held that Oklahoma’s prohibi-

tion on the advertisement of alcoholic beverages did not

violate the Commerce Clause. In Oklahoma Alcoholic

Beverage Control Board vy. Burris, 626 P.2d 1316

38a

(1980), the Oklahoma Supreme Court held that the

First Amendment rights of a retail seller of alcoholic

beverages were not violated by Oklahoma’s laws with

respect to liquor advertising. Retail sellers are permitted

to place a sign outside their retail outlets and are per-

mitted to advertise in the Yellow Pages of the telephone

directory. Those cases are distinguishable from this case

where Plaintiffs are prohibited from rebroadcasting al-

coholic beverage advertisements which originate outside

Oklahoma.

The plaintiffs in this case have demonstrated a genuine

threat of enforcement of the constitutionally contested

laws and the Court finds that it has jurisdiction of the

case pursuant to 42 U.S.C. $1983, 28 U.S.C. $$ 1331,

1343, and 2201.

Motion for Summary Judgment

Motion to Dismiss

The standard for consideration of cross-motions was

recently reiterated in Harrison Western Corporation v.

Gulf Oil Co., 662 F.2d 690 (1981) at 691:

We are fully aware of the fundamental principle

that summary judgment is not to be granted unless

the pleadings, depositions, answers to interrogatories

and admissions on file, together with the affidavits.

if any, show that there exists no genuine issue as

to any material fact and that the moving party is

entitled to judgment as a matter of law. Coyce v.

Carter Oil Co., 618 F.2d 669, 672 (10th Cir. 1980):

Rule 56(c), F.R.Civ.P. It is also settled doctrine

that the fact that both parties have moved for sum-

mary judgment does not permit the entry of a sum-

mary judgment if disputes remain as to material

facts. Buell Cabinet Co.. Inc. v. Sudduth, 608 F.2d

431 (10th Cir. 1979); Securities and Exchange

Commission v. American Commodity E xchange, Inc.,

046 F.2d 1361 (10th Cir. 1976); Rains v. Cascade

39a

Industries, Inc., 402 F.2d 241 (8rd Cir. 1968).

However, cross motions for summary judgment do

authorize the Court to assume that there is no

evidence which needs to be considered other than

that which has been filed by the parties. Securities

& Exchange Commission v. American Commodity

Exchange, Inc., supra; H. B. Zachry Co. v. O’Brien,

378 F.2d 423 (10th Cir. 1967).

Cross-motions have been filed by the parties. In this

case the Court is not only legally authorized to assume

that there is no evidence which needs to be considered

other than that which has been presented by the parties

(Securities & Exchange Commission v. American Com-

modity Exchange, Inc., supra), but the parties have as-

sured the Court both in pretrial conference and in their

briefs that irrespective of any factual disputes with re-

spect to other issues in the case, there are no genuine

issues of material fact with respect to the issues raised

by the motions before the Court. Neither side wishes

further evidentiary hearing, and the Court is asked by

both parties to decide as a matter of law whether upon

the undisputed facts before the Court. Plaintiffs’ consti-

tutional rights are violated because they are prohibited

by Oklahoma law from relaying broadcasts originating

outside Oklahoma which advertise alcoholic beverages.

The Court has given careful consideration to the well

reasoned arguments of both parties, to the amicus curiae

briefs on behalf of each side to the dispute, and to the

legal authorities cited in Support of the various conten-

tions. Careful analysis of the pertinent legal authori-

ties demonstrates conclusively that the laws in question,

as applied to Plaintiffs, are violative of Plaintiffs’ First

Amendment rights and that Plaintiffs are entitled to

the declaratory and injunctive relief they seek. Because

the laws are unconstitutional as applied to Plaintiffs,

the Court need not consider whether the laws are un-

40a

constitutional on their face and or whether they are

unconstitutional on equal protection grounds.

The following facts which are material to the issue

before the Court are uncontroverted:

1. Plaintiffs are corporations, duly qualified to do

business in the state of Oklahoma. Plaintiffs are the

holders of cable television franchises in the state of

Oklahoma. Plaintiffs have franchises throughout the

state including operations in at least the following coun-

ties: Canadian, Cleveland, Grady, Logan, Kay, MeCur-

tain, Jackson, Carter, Ottawa, Oklahoma, Tulsa, Kiowa,

Greer, and Noble. Many aspects of Plaintiffs’ operations

are conducted under regulations issued by the Federal

Communications Commission under the Federa! Com-

munications Act of 1934, 47 U.S.C. $$ 151 et seq.

2. Defendant is the Director and Secretary to the

Board of the Alcoholic Beverage Control Board, an

agency of the State of Oklahoma charged with primary

responsibility for the enforcement of Oklahoma law

relating to alcoholic beverages, and is sued here solely

in his official capacity.

3. As part of their lawful service to subscribers, Plain-

tiffs relay to the subscribers the signals of various tele-

vision stations, some of which originate outside the state

of Oklahoma.

4. Plaintiffs have no contractual relationship with the

stations whose signals they carry, pay no fee to the sta-

tions for said signals, and have no voice in the pro-

gramming carried by such stations.

5. Plaintiffs are prohibited by FCC regulations hav-

ing the force of law and by the Copyright Act, 17 U.S.C.

§ 111(c) (3), from altering or modifying the signals of

the stations they carry, except as expressly permitted by

such regulations. 47 C.F.R. § 76.55(b).

4la

6. For many years and continuing to the present,

some of the programming relayed to Plaintiffs’ customers

has included advertisements for wine, an alcoholic bev-

erage as defined in Article 27, $5 of the Oklahoma

Constitution, and 37 O.S. § 506.

7. Said advertising is lawful where originated, and

no provision of federal regulations authorizes Plaintiffs

to delete it from the signals relayed to Plaintiffs’ cus-

tomers.

8. Advertisement of alcoholic beverages within the

state of Oklahoma is prohibited by Art. 27, $5 of the

Oklahoma Constitution and 37 O.S. $ 516.

9. In Oklahoma Alcoholic Beverage Control Board v.

Heublein Wines International, supra, the Oklahoma

Supreme Court held the Commerce Clause did not pro-

hibit the ban and that the constitutional and statutory

advertising prohibitions required broadcast television

stations to block out wine advertising in programming

delivered to them by the networks. The ban was not

challenged on First Amendment grounds.

10. On May 19, 1980, the Attorney General of the

State of Oklahoma issued an Opinion declaring that the

prohibitions on alcoholic beverage advertising applicable

to broadcast television apply similarly to cable tele-

vision.

11. Defendant has threatened cable television opera-

tors in the state of Oklahoma, including Plaintiffs, with

criminal prosecution if they continue to carry program-

ming containing alcoholic beverage advertising. Defend-

ant’s actions have included letters to all cable operators

notifying them of the alleged illegality of the wine com-

mercials as well as express oral and written threats of

imminent prosecution.

12. There exists no feasible way for Plaintiffs to block

out the advertisements.

42a

13. Failure to carry the out-of-state stations contain-

ing wine commercials would place Plaintiffs in violation

of their franchises and would probably cause a large

but inherently immeasurable reduction in Plaintiffs’ sub-

scriber revenue.

14. The stated purpose of the advertising ban is to

reduce consumption of alcoholic beverages.

15. Consumption of alcoholic beverages in Oklahoma

has increased substantially in the last 20 years despite

the ban on advertising of such beverages.

16. The sale, purchase, and consumption of alcoholic

beverages is, subject to certain limitations not material

to this action, lawful in Oklahoma.

The State of Oklahoma can, under the Twenty-first

Amendment, totally prohibit the sale of alcoholic bev-

erages within the state of Oklahoma. The question be-

fore the Court is whether having legalized the sale of

alcoholic beverages, the State can totally prohibit ad-

vertising of alcoholic beverages except for one sign at

the retail outlet and a listing of wholesalers and retailers

of alcoholic beverages in the Yellow Pages of the tele-

phone directory.

There is no question that Plaintiffs have a speech

interest protected by the First Amendment to the United

States Constitution. Virginia State Board of Pharmacy

v. Virginia Citizens Cons:mer Council, Inc., 425 U.S.

748, 773 (1976); Bigelow v. Virginia, 421 U.S. 809

(1975); Bates v. State Bar of Arizona, 433 U.S. 350

(1977); Ohralik v. Ohio State Bar Association, 436 U.S.

447 (1978).

The Supreme Court traced the recent development in

the protection of commercial speech in Metromedia, Inc.

v. City of San Diego, 49 U.S.L.W. 4925 (1980), as

follows:

43a

The extension of First Amendment protection to

purely commercial speech is a relatively recent de-

velopment in First Amendment jurisprudence. Prior

to 1975, purely commercial advertisements and serv-

ices or goods for sale were considered to be outside

the protection of the First Amendment. Valentine

v. Chrestensen, 316 U.S. 52 (1942). That construc-

tion of the First Amendment was severely cut back

in Bigelow v. Virginia, 421 U.S. 809 (1975). In

Virginia Pharmacy Board v. Virginia Consumer

Council, 425 U.S. 748 (1976), we plainly held that

speech proposing no more than a commercial trans-

action enjoys a substantial degree of First Amend-

ment protection: A state may’ not completely sup-

press the dissemination of truthful information

about an entirely lawful activity merely because it

is fearful of that information’s effect upon its dis-

seminators and its recipients.

49 U.S.L.W. at 4929.

In applying the First Amendment to commercial

speech, the Supreme Court rejected the “highly pater-

nalistic” approach that the State’s protectiveness of its

citizens rests in large measure on the advantages of

their being kept in ignorance. Instead, it noted the

presence of a potent alternative—‘“that alternative is to

assume that this information is not in itself harmful,

that people will perceive their own best interests if only

they are well enough informed, and that the best means

to that end is to open the channels of communication

rather than to close them.” Virginia State Board of

Pharmacy v. Virginia Citizens Consumer Council, Inc.,

supra, at 770.

Such commercial expression not only serves the eco-

nomic interest of the speaker but also assists the con-

sumers and furthers the societal interest in the fullest

possible dissemination of information. Virginia Board

of Pharmacy v. Virginia Consumer Council, Inc., supra;

Bates v. State Bar of Arizona, 433 U.S. 350, 365 (1977).

44a

See also, Linmark Associates, Inc. v. Township of Wi-

lingboro, 431 U.S. 85, 92 (1977).

Recently, the Supreme Court has found unconstitu-

tional a blanket prohibition of price advertising by phar-

macists, a blanket suppression of advertising by attor-

neys, and a blanket prohibition of advertising carrying

information about the availability and price of con-

traceptives. Virginia Board of Pharmacy v. Virginia

Consumer Council, supra; Bates v. State Bar of Arizona,

433 U.S. 350, 383 (1977); Carey v. Population Services

International, 431 U.S. 678 (1977).

Of course misleading advertising may be prohibited

entirely. Ohralic v. Ohio State Bar Association, supra,

Friedman v. Rogers, 440 U.S. 1 (1979). And even when

advertising is not misleading, the State retains some

authority to regulate if the restriction is narrowly drawn

and the regulation furthers the State’s substantial in-

terest. Central Hudson Gas Co. v. Public Service Com-

mission, 447 U.S. 557 (1980).

Article 27, § 5 of the Constitution of Oklahoma makes

it “unlawful for any person, firm or corporation to

advertise the sale of alcoholic beverage within the State

of Oklahoma, except one sign at the retail outlet bearing

the words ‘Retail Alcoholic Liquor Store.’” The Okla-

homa Statutes provide:

It shall be unlawful for any person, firm or corpo-

ration to advertise any alcoholic beverages or the

sale of same within the State of Oklahoma, except

one sign at the retail outlet bearing the words ‘Re-

tail Alcoholic Liquor Store,’ or any combination of

such words, or any of them, and no letter in any

such sign shall be more than four (4) inches in

height, or more than three (3) inches in width, and

if more than one line is used, the lines shal! not be

more than one (1) inch apart.

37 O.S. (1971) § 516.

45a

The defendant claims that the Twenty-first Amend-

ment overrides any First and Fourteenth Amendment

rights of the plaintiffs.

The Twenty-first Amendment, § 2, provides:

The transportation or importation into any State,

Territory, or possession of the United States for

delivery or use therein of intoxicating liquors, in

violation of the laws thereof. is hereby prohibited.

U.S. Const. amend. XXI, § 2.

Defendant relies upon California v. LaRue, 409 US.

109 (1972), in urging the proposition that any speech

which is used in connection with the sale of aleoholic

beverages may be proscribed by a state under the broad

grant of power to the states by the Twenty-first Amend-

ment.

The circumstances of the present case are distinguish-

able from California v. LaRue. supra, In that case the

California Department of Alcoholic Beverage Control

regulations prohibited certain sexually explicit live en-

tertainment or films in establishments licensed to sel]

liquor by the drink. The regulations prohibited the per-

formance of specific acts including sexual intercourse,

masturbation, sexual acts prohibited by law, touching

or fondling of breasts or genitals, displaying of genitals,

or films depicting such prohibited acts. The Supreme

Court found that the State’s interest outweighed the

challenger’s First Amendment rights and that the State

had chosen a reasonable means to attain its interests

since it had not totally prohibited the performances in

question but had merely proscribed such performances

in establishments licensed to sell liquor by the drink.

In this case, the plaintiffs are prohibited from dis-

seminating advertisements of something the public al-

ready knows from experience and from reading news-

paper and magazine advertising—that alcoholic bever-

ages exist and are for sale at certain prices.

46a

A careful reading of California v. LaRue, supra, re

veals that the decision “did not go so far as to hold or

say that the Twenty-first Amendment supersedes all

other provisions of the United States Constitution in the

area of liquor regulations.” /d. at 115.

The Supreme Court recently addressed the power of

the states under the Twenty-first Amendment in decid-

ing that a California state plan for wine pricing was

subject to the federal antitrust laws despite the state’s

power to regulate importation and transportation of

liquor under the Twenty-first Amendment. California

Liquor Dealers v. Midcal Aluminum, 445 U.S. 97 (1980).

The Supreme Court points out that in determining state

powers under the Twenty-first Amendment, the focus

has been largely on the language of the provision rather

than the history behind it. “. . . Even when the states

had acted under the explicit terms of the Amendment

the Court resisted the contention that $2 ‘freed the

states from all restrictions upon the police power to be

found in other provisions of the Constitution . :

Id. at 108. The Supreme Court states that important

federal interests in liquor matters survived the ratifica-

tion of the Twenty-first Amendment including the equal

protection requirements of the Fourteenth Amendment

(citing to Craig v. Boren, 429 U.S. 190, 204-209 (1976) )

and due process requirements (citing to Wisconsin v.

Constantineau, 400 U.S. 433, 436 (1971)).

The Supreme Court has decided that fundamental

constitutional rights such as due process, equal protec-

tion, and freedom of speech are not swallowed up by

the Twenty-first Amendment. Accordingly, we are re-

quired to consider each part of the constitution in light

of the other and in the context of the issues and inter-

ests at stake in the case before us.

Applying the legal propositions that the State cannot

totally prohibit the dissemination of truthful informa-

tion about a lawful activity; that the State has broad

47a

power under the Twenty-first Amendment to regulate

the sale of alcoholic beverages; and that the State re-

tains the authority to regulate advertising if the inter-

ference is in proportion to the interests served to the

undisputed facts before us, is it constitutional for the

State of Oklahoma to totally prohibit the advertising of

alcoholic beverages except for one sign at the retail

outlet and a listing of outlets in the Yellow Pages of

the telephone directory?

The four-part inquiry in Central Hudson Gas and

Electric Corp. v. Public Service Commission. supra,

provides a means of balancing the constitutional rights

of the parties. The analysis turns on the nature of the

expression sought to be suppressed and the government

interests served by the regulation in question.

The test is as follows: First, the expression must be

protected by the First Amendment; that is, it must

concern lawful activity and not be misleading. Second,

the asserted government interest must be substantial.

Third, the regulation in question must directly advance

the governmental interest asserted: and fourth, the reg-

ulation must not be more extensive than is necessary to

serve that interest.

In applying the test to this case, first. we are dealing

with protected speech because there is no claim that the

communications suppressed are either misleading or re-

lated to unlawful activity.

Second, the asserted government interest is substan-

tial. Promotion of temperance is the State interest cited

in the Opinion of the Attorney General as justification

for the ban. Atty.Gen.Op.No. 77-244 (September 19,

1977). Another stated goal of the Oklahoma Alcoholic

Beverage Control Act as stated in the briefs is “an

exercise of the police power of the State of Oklahoma

for the protection of the welfare, health. peace, tem-

perance, and safety of the people of the State ag

48a

The State of Oklahoma has a substantial interest in

the health and welfare of its people. The Twenty-first

Amendment gives it a substantial amount of control

over the sale of alcoholic beverages. The Court recog-

nizes the legitimacy and importance of the State’s goals

of protecting its citizens. The disease of alcoholism and

the deaths and injuries caused by the abuse of alcohol

are very real concerns to the people and the government

of this state.

Third, the Court finds that under the undisputed facts,

the ban on advertising is at best an indirect means of

advancing the State’s interest in temperance for the

following reasons. There is no evidence before the

Courts that Oklahoma’s ban on advertising is a direct

means of preventing alcohol abuse or protecting the

health, safety. or welfare of Oklahomans. It is uncon-

troverted that consumption of alcoholic beverages in

Oklahoma has increased substantially in the last twenty

years despite the ban on advertising of such beverages.

Of course, the argument can be made that an even

greater increase would have occurred but for the ban.

The realities of the situation are that beer commercials

have been permitted despite the ban: wine commercials

are heard in Oklahoma on radio broadcasts which

originate outside the state: beer, wine, and distilled

spirits advertisements in magazines originating outside

Oklahoma are permitted. The Court finds it hard to

believe that the prohibition of advertising by Oklahoma

media is a direct means of achieving temperance.

There are other means available to the State which

are more direct means of combating Oklahoma's alcohol

abuse problems. Some of these were recommended by

the Task Force on Alcohol Abuse after several months

of study and interchange on the issue. The highest

priority was given to early and continuing education

about the biological and psychological effects of alcohol

and its potential for personal and social harm. See,

49a

“Alcohol Abuse in Oklahoma,” Report and Recommenda-

tion of the Task Force on Alcohol Abuse. Such an ap-

proach would be in keeping with the Supreme Court’s

xiew that the best means to help people to perceive their

best interests is to epen the channels of communication

rather than to close them.

\ Fourth, the State’s attempted regulation is more ex-.

tensive than necessary to serve the State’s interest.

Defendant contends that it is important for the Court

to note that Oklahoma has not denied the liquor industry

all means of advertising its product, noting that retail

liquor establishments are permitted one sign and a list-

ing in the Yellow Pages of the telephone directory.

The plaintiffs in this case. however, are holders of

cable television franchises and are totally prohibited

from rebroadcasting advertisements for alcoholic bever-

ages which originate in other states. As to these plain-

tiffs, the regulation is not_one of time, place, and manner

but is a total prohibitiom ef the dissemination of all

information at thesubject of alcoholic beverages.

A means less restrictive than blanket suppression has

not been tried. For example, the State might appro-

priately require warnings of health hazards. It is not

clear that an absolute prohibition of advertising is the

only solution.

Weighing all of the rights and interests involved, the

State of Oklahoma has a substantia] interest in’ the health

and welfare of its citizens and broad power to regulate

the sale of alcoholic beverages under the Twenty-first

Amendment. The State has the authority to regulate ad-

vertising that is inherently misleading or is misleading in

practice. The State's power under the Twenty-first

Amendment will likely support carefully drawn restric-

tions of advertising which are short of a total prohibition

of advertising. But Plaintiffs enjoy a substantia! degree

of First Amendment protection which requires that the ,

50a

State’s regulation of commercial speech, even with the

added weight of the Twenty-first Amendment, be care-

fully drawn to directly further the State’s interest and

that it be no more extensive than reasonably necessary to

further the State’s interest. In the absence of any allega-

tions that the prohibited advertising is misleading, the

Court finds that a total prohibition of all advertising by

the plaintiffs fails to meet these wequirements.

Accordingly, Defendant is hereby permafiently en-

joined from enforcing Article 27, $ 5, of the Oklahoma

Constitution and 37 O.S. $ 516 (1971) against the plain-

tiffs and a declaratory judgment shall be entered that

enforcement of these laws would violate Plaintiffs’ rights

under the First Amendment as guaranteed to the states

by the Fourteenth Amendment to the United States

Constitution.

Defendant’s Motion to Dismiss is DENIED in all

respects. Plaintiffs’ Motion for Summary Judgment is

GRANTED.

IT IS SO ORDERED this 10th day of February, 1982,

NUNC PRO TUNC December 18, 1981; the Memoran-

dum Opinion entered December 18, 1981, is withdrawn

and this Memorandum Opinion is substituted therefor.

/s’ Lee R. West

United States District Judge

Date of Entry: February 10, 1982

5la

APPENDIX H

CONSTITUTIONAL PROVISIONS AND

STATUTES INVOLVED

The First Amendment to the Constitution of the United

States provides:

“Congregs shall make no law respecting an estab-

lishment gf religion, or prohibiting the free exercise

thereof ; ok abyidging the freedom of speech, or of the

press; or the right of the people peaceably to assem-

ble, and to petition the Government for a redress of

grievances,”

Section 1 of the Fourteenth Amendment to the Constitu-

tion of the United States provides:

“Section 1. All persons born or naturalized in the

United States, and subject to the jurisdiction thereof,

are citizens of the United States and of the State

wherein they reside. No State shall make or enforce

any law which shall abridge the privileges or immu-

nities of citizens of the United States; nor shall any

State deprive any person of life, liberty, or prop-

erty, without due process of law; nor deny to any

person within its jurisdiction the equal protection of

the laws.”

The Twenty-first Amendment to the Constitution Of the

United States provides:

“Section 1. The eighteenth article of amendment to

the Constitution of the United States is hereby

repealed.

Section 2. The transportation or importation into

any State, Territory, or possession of the United

States for delivery or use therein of intoxicating

liquors, in violation of the laws thereof, is hereby

prohibited.

52a

Section 3. This article shall be inoperative unless

it shall have been ratified as an amendment to the

Constitution by conventions in the several States, as

provided in the Constitution, within seven years

from the date of the submission hereof to the States

by the Congress.”’

Article 27, Section 5 of the Constitution of the State of

Oklahoma provides:

“Sec. 5. Prohibition of sales to certain persons—

Limitation on advertising—Penalties. It shall be un-

lawful for any licensee to sell or furnish any alco-

holic beverage to:

A person under twenty-one (21) years of age; or

A person who has been adjudged insane or men-

tally deficient; or

A person who is intoxicated.

Sales, gifts or deliveries to persons under twenty-

one (21) years of age shall be deemed a felony; and

any license issued pursuant to any law, in com-

pliance with this Amendment, shall be revoked, upon

conviction for such sale, gift or delivery.

It shall be unlawful for any person, firm or-cor-

poration to advertise the sale of alcoholic beverage

within the State of Oklahoma, except one sign at the

retail outlet bearing the words “Retail Alcoholic

Liquor Store.”

Sales to insane, mentally deficient, or intoxicated

persons shall be deemed a felony.

Any person under the age of twenty-one (21)

years who misrepresents his age, for the purpose of

obtaining the purchase of any alcoholic beverage,

shall be guilty of a misdemeanor.”

53a

Section 516 of the Oklahoma Alcoholic Beverage Control

Act, 37 Okla. Stat. Ann. § 516, provides:

[

“Sec. 516. Advertising. It shall be unlawful for

any person, firm or corporation, to advertise any

alcoholic beverages or the sale of same within the

State of Oklahoma, except one sign at the retail out-

let bearing the words “Retail Alcoholic Liquor

Store,” or any combination of such words or any of

them and no letter in any such sign shall be more

than four (4) inehes ‘in height or more than three

(3) inches in width, and if more than one (1) line is

used the lines shall not be more than one (1) inch

apart.”

ection 111(c)(3) of the Copyright Act of 1976, 17

S.C. § 111/¢) (3), provides:

“(3) Notwithstanding the provisions of clause

(1) of this subsection and subject to the provisions

of subsection (e) of this section. the secondary trans-

mission to the publie by a cable system of a primary

transmission made by a broadcast station licensed

by the Federal Communications Commission or by an

appropriate governmental authority of Canada or

Mexico and embodying a performance or display of

a work is actionable as an act of infringement under

section 501, and is fully subject to the remedies pro-

vided by sections 502 through 5V6 and sections 509

and 510, if the content of the particular program in

which the performance or display is embodied, or

any commercial advertising or station announce-

ments transmitted by the primary transmitter dur-

ing, or immediately before or after. the transmission

of such program, is in any way willfully altered by

the cable system through changes, deletions, or addi-

tions, except for the alteration, deletion, or substitu-

tion of commercial advertisements performed by

those engaged in television commercial advertising

54a

market research: Provided, That the research com-

pany has obtained the prior consent of the advertiser

who has purchased the original commercial adver-

tisement, the television station broadcasting that

commercial advertisement, and the cable system per-

forming the secondary transmissions: And provided

further, That such commercial alteration, deletion,

or substitution is not performed for the purpose of

deriving income from the sale of that commercial

time.”’

Section 76.55(b) of the rules of the Federal Communi-

cations Commission, 47 C.F.R. § 76.55(b), provides:

“(b) Where a television broadcast signal is car-

ried by a community unit, pursuant to the rules in

this subpart, the programs broadcast shall be carried

in full, without deletion or alteration of any portion

except as required by this part.”

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.