Brief for the Respondent in Opposition — Bucks County Cable TV, Inc. v. United States

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| LIBRARY

SUPREME COURT, U. S.

60 SP ae tabs Ae

“AUG 24 1970 _

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UNitebp STATES OF

—

BUCKS COUNTY CABLE.

COMM

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Of Coursel.,

IN THE

Supreme Court-of the United States

OCTOBER HRM. 1970

et Sew

No. 443

AMERICA.

ISSION. ROBERTI

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THIRD © IRCI

FLDERAL

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Petitioner,

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S. COMMUNICATIONS CORPORATION:

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COMMUNICATIONS

L.. AND.

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Respondents.

AP PEALS

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CORPORATION IN_OPPOSITION

COVINGTON & BURI ING

588 Sixteenth Street, N.W.

Washington,DC.

1970

August,

»

.

CHARLES

SSS Si

ON PETITION FOR A WRIT OF CERTIORARI TO THI

_BRHEF FOR RESPONDENT U.S. COMMUNICATIONS

A. MILLER

388 S — Street, N.W.

Washington, D.C. 20006

Attorney: for Respondent US.

Communications CoFporation

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“;TABLE-OF CONTENTS" ~ 2.

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QUESTION PRESENTED 000.000... TO AG eee,

STAIONENT ise eee pm cat ee 1 )

REASONS FOR DENYING THE WRIF 2.20.00... 6

EN NO ie ee hag ee eran ee abe ein 10

TABLE OF AUTHORITIES.

Court Decisions:

Black Hills Video Corp. v. F.C.C., 399 F.2d 65 (8th Cir, a

i.) ee PrP A eT Sheed PGA okay ied eee alee MeNade SS a

iS CORA 87s 00 Be eS re ee Oe s

Harvey Radio Laboratories v. United States, 289 F.2d *

WRG. C8 196 en es Caste er

Kessler v. F.C.C., 320. F.2d 673-(D.C, Cir. 1963) 8.0 bse 9

-MesaMicrowave. Inc. v, FC L., 262 F.2d 723

(D.C. Cir. 1958) Pied openres arts RS far Fe Ser ene 9

United States v. Southwestern Cable €o0., 392 -

hae BOT sh ss sos Te ae Wee eta ey sy Meh 2,8

United States v. Storer Broadcasting Ca., 351 U.S. 192 8

_ FCC Notices, Decisions and Orders: ,

's Delaware County Cable Co.. 12 F.C.C.2d 529, | /

33 OM. GSOU 19GB)... a ecard oe Si xs 4

Midwest Television, Inc., 4 F.C.C.2d 612,31 FR.

° 10335 (1966 ) As cae RTE ee wee RSET Aaa eee eee ee oy pae |

Notice-of Proposed Rule Making. Docket No. 18397, |

AS FCO 28 AT, OB FR ESOS (1968) es ce 3.4

Second Report and Order: oP OL .28 72531 FR.

EEE os ee Es a

Reguiations: e -

" 47.C.F.R.§ 73.083... aes ee ee et A eee ae.

47 C.F.R. 8 74.1105(c) 2... eee PME AB) 1, 3

47 CFR. §74.1107(a) A arene yeah tae, Bs APO eke ee

ATLP MATAR co a eee 3

?

i

IN THE

Supreme Court of the United States

OC TOBI R ib RM, fy70

~~

’ i

No. 443

Bucks County CaBir. TY, INC.:

,. Petitioner,

Vv. -

UNITED STrates: Ob AMERICA. FEDERAL COMMUNICATIONS

COMMISSION. ROBERT TY BARTLEY. ‘ET AL.. AND

U.S. COMMUNICATIONS CORPORATION,

—

‘Respondents.,

ON PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

_ FOR THE THIRD CIRCUTE

@ pcsiasemeenanectinis

BRIEF FOR RESPONDENT US. COMMUNICATIONS

° CORPORATION IN iia icoaiiy

ee PRESENTED

¢

Whether a F ederal C ommunications Commission rule. 47.

C.F.R. "$74. 1105(e). prohibiting a CATV system from car-

rying television broadcast signals until the Commission dis- |.

poses Of or otherwise acts on a timely filed petition chal-

lenging the proposed carriage is lawful.

i

STATEMENT

‘In 1966. the’ Federal Communications Commission

adopted rules regulating the operations of community—an-———

tenna television systems (CATV*systems).' The Commis- _

sion’s jurisdiction. to regalate CATV systems was sustained

‘in United States v.-Southwestern.Cable Co., 392 U.S. 157.

The rules were upheld on the merits against a variety of -

challenges in Black. Hills Video orp v: FCC /399 F.2d 65

(8th Cir. 1968). es Aid

The 1966 rules were the first FCC effort at comprehen-:

sive regulation of CATV practices. and they reflected the

Commission’s concern with the potential adverse impact of

unregulated CATV operations on the development of the -

over-the-air system of. television. broadcast stations, among --

them new and still struggling UHF stations in markets like

Philadelphia.? In the highly controversial area of “outside”

signal carriage, the Commission decided that in the centers

of the 100 leading broadcast ‘markets CATV systems’ would

not be allowed to import television broadcast signals from

beyond their Grade B contours? ‘without first having se-

cured FCC permission to do so in an evidentiary hearing:

47 C.F.R: 8 74.1107(a). In all cases CATV systems. are to

give notige to interested persons of their intention to com- .

mence operations and to identify the signals they intend to

carry. [n.cases not covered by the prior evidentiary hearing

— ae

‘Second eit and Order on CATV, 2 F x C. 2d 725, 31 F. R.

4540. —

*The deci iia and Order on C ATV. nl, supra, repeatedly’

cited the Philadelphia market as the classic illustration 6f the adverse :

effects on local, stations, especially developing UHF stations, that

might ensue if CATV systems were permitted to carry television sta-

tions fromm another market (New York Cay. See 2 a at 771-

76, 31 F.R. at 4558-59. ;

3The Grade B contour: is "a eenibtici line determined in\accord-

ance with FCC rules and. intended to approximate the reach of a sta-

‘tion’s service area. - See 47 C.F.R. § 73 683.

.%

«

rule of 47 C.F. R. 8 74, 1107(a), an. ‘eheeeutcal person may.

petition for special relief. 47 C.F. R. 8 74. 110%a). Hf Sich

_a petition is filed within 30 days of the noticethe-chal

~ lenged service may. not commence until the Commission

-ucts on the petition. 47,C,F.R. 8 74.1105(c):

The Commission specifically recognized that there would

rae . “be cases of proposed “outside signal” carrigge not covered

by the letter of rule 74° KOT). such as where the Grade

© . B contour of a station from another market theoretically

‘reaches the CAT-V community but that station does not

_ purport. to serve and is not generally viewed in the CATV

community. It —— the use of be cts relief peti-

_ +tions in such, cases."

The essence of the FCC’ S approach to outside signi

fie ae * regulation was to examine CAT¥ proposals , before the serv-

2 ice commenced, for the Cammission was acutely aware of

: "the impracticality of withdrawing’ service from the public

once it had become entrenched, :

Hundreds of requests for evidentary hearings by. ATV

-systems under rule 74.1107(a) were submitted in. the |.

months following adoption of the rules. There were also

aM - scores of special ‘relief petitions. The Commission deter-

- mined to deal with these requests and petitions on a

| market-by-market basis. In early 1968 it took up the

be Philadelphia television market where’ there had been nu- |

-, merous proposals for CATV, carriage of outside signals: par-

ticularly signals from New York City. Some involved com-

munities reached by the Grade B contours of. the New York.

?

aoe 4 Second aii and Order on CAIN, Line x at 786, 1.69:

| . 31 F.R. at 4564, 1.69.

57d. at 781-82, 31 F.R. at’ 4562. And see Midwest Television,

Inc. 4 E.C-C.2d 612, 31 F-R. 10335 (1966): Notice of Proposed Rule »

¢ Making in Docket No. 18397, 15° FIC.C.2d- 417, 33 F.R. 19028

— ide ae ea | eee

BS oer ro

City stations and were before thie Commission ‘by virtue

of special relief petitions.

In March 1968: the Commission set down a cortsolidated

"___market-wide- hearing on alt CATV proposats tor communi-

"ties within 40 miles of Philadelphia. In-those communities

reached by the Grade B-contours of the New York City

stations, the FCC issued temporary orders to preclude the |

carriage of New York City signals pending the hearing.®

_ Shortly thereafter, petitioner gave its notice under rule

74.1105(a) of intention to provide CATV service in Falls

Township, located less than’10 miles from Philadelphia, and |

to.carry New York City signals (whose Grade B contours’

reached Falls Township). CAdimely petition for special're- — .

lief was filed on behalf of Philadeiphia UHF stations WPHL-

TV and WIBF-TV which inyoked the ‘stay of - section’

74.1105(c) against petitioner’s carriage of New York City

signals. R. 3a-1.7 |

While the special relief petition was‘pending, the Com-

mission on December 13, 1968, announced proposed revi-

sions of its rules, which included the elimination of further

evidentiary hearings and the substitution of fixed rules on

CATV carriage of outside signals.* One ‘of the proposed |

rules would preclude petitioner's carriage of New YorkCity

signals in Falls Township absent retransmission consent

which petitioner did and does not have. The FCC also an-

nounced that in the interim pending final action on its pro-

posed rule changes it would not act on pending cases in- =

- volving proposed CATV operations inconsistent with the —

‘proposed rules. It further announced that CATV systems

-

® Delaware County Cable Co., 12 F.C.C.2d 529, 33 FR. 6561

(1968). }

7 References to the printed Joint Consolidated Appendix in the

court below are cited “R._

. ®8Notice of Proposed Ruie Making. in Dotket No. 18397, 15

F.C.C.2d 417, 33 F.R.- 19028 (1968). ; ight \

that had lawfully comimbaced service prior to ‘December

20, 1968 (the date of publication of the proposed rules in

the Federal Register), ‘would be “grandfathered.” even

‘though their carriage was inconsistent with the proposed

rules. ‘This was another manifestation of the Commission’s .

‘recognition .of the impracticality of withdrawing service

once commenced lawfully in reliance on its rules. * 1+

On December 19, 1968, petitioner began carrying New

York City signals on its Falls Township system in violation

of the FCC's rules. Thereafter, it instituted suit in the Dis-—

trict Court seeking an injunction against enforcement of the

rules against ae a =

On January 2 1969: in apie hee aged tig

petition of the UHE stations, the Commission enteréd a

temporary. order. that prohibited petitioner’s carriage of |

New. York City signals pendente liie and consolidated the

petition into the Previously . instituted Philadelphia market-

“wide CATV proceeding. R. 173a. Petitioner sought review

_of this order in the Cottrt of Appeals. together with rule

74.1105(c) and the “interim: procedures” of the December

1968 proposed rules insofar as they “froze” action on the

special relief petition against petitioner's carriage. of New >

York City signals. -R. 197a-21 3a.

The District Court granted petitioner the relief it ae

in that court. R. 382a. The government appealed and the

case was consolidated with the petitions for review filed by

petitioner in-the Court of Appeals. That court reversed the

District Court and ‘upheld the challenged ‘actions of the

FCC. It sustained rule 74.1105(c), which provides for a

stay of ‘proposed CATY service ‘challenged in a special re-

. .

~- lief petition ‘pending action on the petition.“das “a vital part

of the FCC’s total regulatory concept, adopted.in a com-

prehensive rulemaking preceeding” and a necessary proce- ..~

dure to prevent entrenchment of CATV operations before .

— the C ommission ‘can review their public interest-implica-

tions. Pet. App. 41a. It also rejected the Claim that the: _

FCC had delayed unduly in acting on the UHF stations’

(y

<

special relief petition, halding that “ine considering these

comptes public-interest’ problems.) the FCC was ‘not

bound by: the same strict limitation which binds’ courts in

the consideration of temporary restraining orders.” Pet. | S

App. d2a. Tt noted that the FOC had already established

a firm poliey in the Philadelphia market that required a .

stay of petitioner’s proposed carriage of*New York Cut |

signals. Pet. App. 44a. Tt held that: petitioner had no right

-fto ashearing and no right to commence carriage ot New

“York City Venals.

sS

REASONS FOR DENYING THE WRUT

/

‘

Phe petition does not presentany question Warranty

“review under the standards of this Court ZOVErNINY certo:

rant, There is no conthet among the circuits and ne con

fet with prior dgeisions of thys Court. Petitioner's chalk ¢

denge ‘ot a pracedural rule established by the BCC as part.

ofan administrative mechanism necessary to implement

conside red regulatory policy 7 8 tusubstantial and i ans

seven Was ‘fully considered by the Court ot Appe als. Ad

“ditionally, the question presented appears to be Moot

1. The stay provision of rule 74.1 108¢e) is clearly law:

Tal Tt ts. as the court below recognized, “an integral part

of the FCC's regulatory scheme designed to provide for.

prior agency consideration of important problems -posed by

CALYV service.” > Pet. App. 42a. Petitioner now concedes

that a system tor-review of © ATV proposals prior to com

Meneement Of service ts necessaty . and that.such a review

S\ stem may be triggered ly Objections of an titere sted.

party. Pet. p. LOS Its argument agaist rule 74.1 LOSee) IS

that there ts no provision for some official to review the

special relief petitions and determine theit nicrit-before any

stay becomes effective. - biti such a requirement

would undermine the objective of preventing the com

mencement of CAEV service prior to POC determination

.

of public interest questions ° Given the hundreds of such.

Petitions submitted to the Commission, some device. to pre-

vent commencement of operations until the inertial review

Of the pleadings is indispensable. to the PCC's revue EN

Jseheme. as the court below recognized.

In this case the stay of section 74 bE EOS(Ce) Operat ( tor.

five months, from the time the: pleadings Were complete a

until the Corininssion issued HS temporary order on Jan:

ary 22) 1969) Ihe Courtoot Appeals held that this period

“did not appear Unreasonable in view of the large bumbei

ot smite INatleis Chen powding before the POC for consid

eration’ (Pet App. Va), the tact that over a uionih prio:

to the isstanee of the temporary order the Comnmussiog htc

Issued its proposed new tules which detérmined tentativel

that operations like petitioner’ S proposed carriage of New

York City signals would be contrary to the pubhe taterest,

and the fact that the € Omissions pohley me tie Philadel

phia market had been cle atly established just two mouths

prior to the fiking.of petitioner's notice. As the court ob:

served, petitioner, “was aware that, consistent with Poe

policy for the Philadelphia market. its challenged ‘carrligs

of New York signals ae le further sti wed pending an

area-wide heariy “: Po App 44a Under all these ci

stances, the Operation 2 the rule 74. ETOSCG) stay. ins this

case Was clearly reasonable, and the ease presents no qu

hon’ as to that rule anne review by ‘this Court,

"There sno Kener punemple Chat suchsotticnl review is required

regardless ot the Wature of the restramt. and petitioner cited io sin mn

authority. Phe “survew of other adaumitrative APENCEY Pprovistar:

“does not even purport Cosexamine comparable situations. let alone th

estabjish a constitutional at statutory limitation on What procedure

ave permysstble, Pet. pp. 7-8. The oniy federal authority. cited

does involve limitations relates to “search wattrants, Wrest Warrants

and. orders: permitting bunlding imspectrors.” Pet. po O which are,

hardly relevant to the yonditions on whieh radio. apd television sip

nals may be extended beyond them normal range

0

Even if the stay was in force for an unduly long p@riod Ha thins

vase, petitioner Was not entitled to commence the ch: Henged s c

Inuit merely to seek. Wadden assistance fo compel FCO action on a

[footnote CONTINUE:

~t

*. 8

2. Petitioner’s effort to invoke this Court's decision ¢

United States v. Southwestern Cable Co., 392 US..157,

- unavailing. In that case the C ourt upheld a temporary FC a

order.issued at the oatset of the proceeding prohibiting the

CATV. operations then in question pendente lite. ~The ra-

tionale for that decision was that * ‘the administrative ta

cess. -must] pOssess sufficient flexibility to adjust itself

the “dynamic aspects of radio transmission’ ~ (392 US: at

180) and that the Commission possessed the authority, to ~

preserve-an existing situation pending its determination of

whether the challenged CATV operations are consistent

with the public interest. ‘That is precisely the role played

by the stay provision in rule 74.1105(c}). The fact that in

Southwestern Cable the Commission had reviewed the

pleadings before entering its temporary order,'' whereas in

this case rule 74.1 10S(c) operated to fill the gap until the

Commission could review the pleadings, does not make

Southwestern Cable any less applicable. UW anything, the

rule 74.1105(c) stay ptovision, by preserving the situation

until the Commission can review the pleadings, is indispen-

sable to the successful implementation of the interim re-

lief procedures sustained in Southwestern Cable.'?

special relief petition. See Pet. App. 44a. Commencement of opeta-

tions by petitioner on December 197 1968, was particularly inappro-

priate in the face of the earlier Commission determination of policy

. for CATV in the Philadelphia market and its tentative determination

announced on December 13, 1968, that CATV operations of the kind

proposed by petitioner were so clearly contrary to the public interest

that they should be barred by rule. ws

"Rule 74.1105(c) was inapplicable in that case because the chal-

lenged operations had commenced prior to adoption of the Commis-

sion’s tules. .

Petitioner complains that the evidentiary Hiearing.in this case has

been indefinitely deferred pending a rulemaking proceeding and that

this further distinguishes Southwestern Cable. But it ms beyond dis-

pute that an agency has ¢onsiderable flexibility in determining

whether to proceed by rule making or, adjudication. F.P.C..v. Texaco,

377 US. 33, 39-44; United States v. Storer Broadcasting Co., 351.

U.S. 192, 200-05. Here it. was unquestionably within the Commis-

{footnote continued]

9

3. apap failure to present a question as to the

January 22, 1969, order of the FCC renders moot its chal- °

lenge to the Sty provision of rule 74. 1105(c).. The stay

provision was in. effect. from the filing of ves special relief

petition until the Commission’ s January 2 22, 1969. tempo-

rary order prohibiting. petitioner .from carrying New York

City television signals pending disposition of the Philadel-

phia market-wide CATV proceeding. That order i is still out-

standing and in effect. Although petitioner challenged it

in the court below, it does not challenge the order in its

certiorari petition. Thus, even if petitioner were correct

that the stay of rule. 74.1105(c) should not have applied

to it, it is nonetheless subject to the January 22,1969,

order. | ” Accordingly, resolution of the question presented

in- the petition would have no- ‘practical consequence.

sion’s discretion to defer- pending ibedicihion peogeedings while it °

considered new rules that would determine the issues in the pending

proceedings. See, e.g., Kessler v. F.C.C., 326 F.2d 673 (D.C. Cir.

1963): Harvey Radio Laboratories v. United States, 289.F.2d 458

(D.C. Cir. 1961): Mesa Microwave. Inc. v. F.C:C.,.262 F.2d -723 (D.C.

Cir. 1958).

'S Petitioner asserts, — citation, that the Court of Appeals

“disregarded” the January 22; 1969, order in reaching ifs decision.

.Pet:, E 15,n.4. To the contrary, the court below relied on the Jan-

uary 22, 1969, order. See Pet. App. 43a, 44a. Petitioner also ad-

_ vances several arguments in an effort to avoid the effect of the Jan-

_ uary 22, 1969, order. Pet., pp. 15-16, n.4.° The claim that the order

merely continues the stay af rule 74.1105(c) is clearly incorrect. By

"its terms, rule 74.1105(c) applies only until the Commission rules on

the special relief petition “or en the interlocutory question of tem-

porary rélief pending further procedures.”. The January 22, 1969,

order was such an’ interlocutory ruling; it permitted the carriage of

Philadelphia and Wilmington signals but no others pendente lite. Pet.

App. 3a. oe other contentions are to the effect that the

January 22, 1969, order ought -not have been entered. But it was

entered, it is in force, the arguments against it were rejected. by the

court below, and its oer has not been presented to, this Court for

review. . ‘

10

CONCLUSION

The petition for writ of certiorari. should be ‘denied.

Of Counsel:

COVINGTON & BURLING

Respectfully submitted,

CHARLES A. MILLER

. 888 Sixteenth St.. N. W.

Washington, D. C. 20006

- Atiorney for Respondent U.S.

Communications. Corporation

888 Sixteenth Street, N. W.

_ Washington, D. C. 20006 —

August | 970

é

Ck Vouphesty

Opinions isin eee Mees eee Pee 1

sureetietion <2) Hd Naot hg Saas

Question presented__- = gee ee

Regulatory provisions inv oly Meee a 2

Statement. ________- Be ee a re aon aa en 3

| aie eee ones i pmee i)

Conetusion...2 0-5 a la nae ea ae 14

- aha S

Cases: .

7 American hptiies, dae et al. v. Civil Aero-

nautics Board, 359 TV. 2d 624, certiorari

denied, 385 U.S. 848__---.-- 13

Black Hills Video Corp. v. F eder al Comm un-

cations Commission, 399 F.2d 65...... Hi

Buckeye Cablevision, Inc: v. Federal Communi: :

‘cations Cominission, 387 T°. 2d aed OT a RE |

Californi@®Citizens Band Ass’n, Ine. v. Federal 2 :

_ Communications Commission, 375 F. 2d 43,

certiorari denied, 389 U.S. SS Care es

Columbia Broadcasting Si ystem v. U. nited & States, -

Oe Re WE dela hatdncdcat set IO ee 13

Federal Communications Commission ¥. * Potts-

' ville Broadcasting Co., 309 U.S. 134.20 | 11

Federal Power Commission v. Texaco, 377 US... - ;

eh ree aa BEA Rate Mite ara "3° :

Fortnightly Corp. v. United Artists Television, 9 — -

Tne., — Sa Me era _10

a)