Opposition Brief — Media General, Inc. v. Federal Communications Commission

Supreme Court brief2005

Ask Donna

What actually matters in this document.

Text

FICE OF THE CLERK

(S)

Nos. 04-1020, AC, 04- ) & 04-1168, and 04-

Jn the Supreme Court of the Gnited States

MEDIA GENERAL, INC., Petitioner,

FEDERAL COMMUNICATIONS COMMISSION AND

UNITED STATES OF AMERICA, Respondents

ON PETITIONS AND CROSS-PETITIONS FOR A WRIT OF

CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR

THE THIRD CIRCUIT

BRIEF IN OPPOSITION FOR PUBLIC INTEREST

RESPONDENTS

ANGELA J. CAMPBELL ANDREW JAY SCHWARTZMAN*

KAREN HENEIN MEDIA ACCESS PROJECT

INSTITUTE FOR PUBLIC 1625 K Street, NW, Suite 1000

REPRESENTATION Washington, DC 20006

GEORGETOWN UNIVERSITY (202) 232-4300

LAW CENTER Counsel for Prometheus Radio

600 New Jersey Ave., NW Project, Fairness and Accuracy in

Suite 312 Reporting, and Center for Digital

Washington, DC 20001 Democracy

(202) 662-9535

Counsel for Media Alliance GLENN B. MANISHIN

and Office of KELLEY DRYE & WARREN, LLP

Communication of the 8000 Towers Crescent Drive #1200

United Church of Christ, Vienna, VA 22812

Inc. (703) 918-2322

Counsel for Consumer Federation

of America and Consumers Union

May 2, 2005 *Counsel of Record

[Additional Counsel Listed on Inside Cover]

Re ROY aE ROR AN AcE TOT ASR SD: NRT NATTA Ir RAN RR SAO HON

SHELBY D. GREEN

PACE UNIVERSITY SCHOOL

OF LAW

78 No. Broadway

White Plains, NY 10603

(914) 422-4421

Counsel for National

DAVID HONIG

NICOLAINE LAZARRE

MINORITY MEDIA &

TELECOMMUNICATIONS

COUNCIL

3636 16" St. NW, #B-366

Washington, DC, 20010

Council of the Churches of (202) 332-7005

Christ in the United States

Counsel for American Hispanic

Owned Radio Association, Civil

Rights Forum on Communications

Policy, League of United

Latin American Citizens,

Minority Business Enterprise

Legal Defense and Education

Fund, Minority Media and

Telecommunications Council,

National Asian American

Telecommunications Association,

National Association of

Latino Independent Producers,

National Coalition of Hispanic

Organizations, National

Council of La Raza, National

Hispanic Media Coalition,

National Indian Telecommuni-

cations Institute, National

Urban League, Native

American Public Telecommuni-

cations, Inc., PRLDEF—

Institute for Puerto Rican

Policy, Unity: Journalists of

Color, Inc., and Women’s

Institute for Freedom of the

Press

QUESTIONS PRESENTED

Whether this Court should overrule its long-settled hold-

ings in Red Lion Broadcasting v. FCC and FCC v. Na-

tional Citizens Committee for Broadcasting that broad-

cast regulations receive rational basis review under the

First Amendment, that newspaper-broadcast cross-

ownership regulations do not impermissibly discriminate

in violation of the First or Fifth Amendment, and that

newspaper-broadcast cross-ownership regulations are

content-neutral. ,

Whether the court of appeals’ interpretation of §202(h) of

the 1996 Telecommunications Act accords with the deci-

sions of the only other court of appeals to have consid-

ered the issue.

Whether the court of appeals properly remanded for justi-

fication or modification certain aspects of the Federal

Communications Commission’s 2002 Biennial Regula-

tory Review Order that were not supported by the record

or that lacked reasoned analysis.

CORPORATE DISCLOSURE STATEMENT

Pursuant to Rule 29.6 of the Rules of this Court, Public

Interest Respondents state as follows:

Prometheus Radio Project, Fairness and Accuracy in

Reporting, Center for Digital Democracy, Media Alliance,

Office of Communication of the United Church of Christ,

Inc., Consumer Federation of America, Consumers Union,

American Hispanic Owned Radio Association, Civil Rights

Forum on Communications Policy, League of United Latin

American Citizens, Minority Business Enterprise Legal De-

fense and Education Fund, Minority Media and Telecommu-

nications Council, National Asian American Telecommuni-

cations Association, National Association of Latino Inde-

pendent Producers, National Coalition of Hispanic Organiza-

tions, National Council of La Raza, National Hispanic Media

Coalition, National Indian Telecommunications Institute, Na-

tional Urban League, Native American Public Telecommuni-

cations, Inc., PRLDEF—Institute for Puerto Rican Policy,

Unity: Journalists of Color, Inc., Women’s Institute for Free-

dom of the Press, and National Council of the Churches of

Christ in the United States have no parent companies or pub-

licly-issued stock.

ili

TABLE OF CONTENTS

QUESTIONS PRESENTED .........cccccccosscssssesscsccsscessseeccosseeeses 1

CORPORATE DISCLOSURE STATEMENT.............:seee0000 li

TABLE OF AUTHORITIES............cscccccosccssscscsccsscsccessscseessses Vv

ST AT RRIEIIN Ei cconscrcesicsaninsasancscsrecsscaessenensestqnstacueecoeceates piintnies 1

REASONS TO DENY THE WRIT .........:csscsssesseesseeeeeeeneees 2

I. PETITIONERS HAVE NOT DEMONSTRATED

ANY COMPELLING REASON TO OVERRULE

LONGSTANDING PRECEDENT .........:cccecsessseseeees 3

A. Petitioners Have Presented No Compelling

Reason to Revisit NCCB’s Holding That

Rational Basis Is The Appropriate Standard For

Review Of Broadcast Regulations .................s008 4

1. Neither Congress Nor The FCC Have

Signaled That This Court Should Reconsider

Its Approach To Broadcast Regulation........... 4

2. Spectrum Scarcity Continues To Exist As A

ie GE IR, scisesassniinipnnnscinictnceiamciniantnnnnin’ 8

3. There Is No Conflict Among The Circuits

Regarding The Scarcity Doctrine................... 9

B. Petitioners Have Presented No Compelling

Reason To Revisit NCCB’s Equal Protection

C. The Court Below Did Not Address Whether

Cross-Ownership Regulations Are Content-

Based; Nor Have Petitioners Presented Compel-

ling Reason To Revisit NCCB’s Holding That

Such Regulations Are Content-Neutral.............. 15

D. Should The Court Wish to Reconsider

Its Constitutional Precedent, Other Cases

Offer A Better Opportunity For Fully

Il. THERE IS NO CONFLICT OVER THE

INTERPRETATION OF §202(h) OF THE 1996

TELECOMMUNICATIONS ACT .......c.cccccesssseeseees 17

II]. ROUTINE APPLICATION OF WELL-SETTLED

ADMINISTRATIVE LAW STANDARDS DOES

NOT MERIT THIS COURT’S INTERVENTION.. 21

CONC TATEIIIIEN caceccccscssssnsessenessrencsnteonsscsnssnsopensssnnangentonceniness 25

TABLE OF AUTHORITIES

Cases

Action for Children’s Television v. FCC, 58 F.3d 654

pei See Ia asitieiatsnteesincipiatiicnsnscessinnliniediassietntaniasnnaiteae 10

Adventure Communications, Inc. v. Kentucky Registry of

Election Fin., 191 F.3d 429 (4th Cir. 1999)... 10

American Family Ass'n, Inc. v. FCC, 365 F.3d 1156

Cie EENL Ae chicnhisgntsacstuntndinsanietmeesnion 8, 10, 11, 15, 16

Beach Television Partners, In re, 38 F.3d 535

Ee Gly OPO crip hcaucichancnbancihnckahclaenteimtiassitidiiennensantbisbinsisies 10

Black Hills Video Corp. v. FCC, 399 F.2d 65

Sy SN ieeitenctnidsissibcincicietinnsiditansinledhisieieietnadidntintiiibetan 10

Bunting v. Mellen, 541 U.S. 1019, 124 S.Ct. 1750 (2004)... 10

Cellco P'ship v. FCC, 357 F.3d 88

Is ee a ei nsinbinile ncn ctisaitmnnatsniedeiiabinibeanctionticidai 18, 19, 20

Chesapeake & Potomac Tel. Co. v. United States,

42 F.3d 181 (4th Cir. 1994), vacated, 516 U.S. 415

CD ccinninehceiiniliesineaaiielismnepnennisapicinntues 14

Chicago Cable Communications v. Chicago Cable

Comm 'n, 879 F.2d 1540 (7th Cir. 1989) ..........cceceeeees 10

Cmty. Communications Co., Inc. v. City of Boulder, Colo.,

py Pty || |S A _ : ERC ON rernanr 10

FCC v. League of Women Voters of California,

ee ED cntestetnnenntiatieicrntcinigatanemanescnin 4, 5,14

FCC v. National Citizens Comm. for Broad., 436 U.S. 775

IT shiners cea teitbceaierstaneidinaei alle ced nciatiteaalans passim

Fox Television Stations, Inc. v. FCC, 280 F.3d 1027,

modified on rehearing, 293 F.3d 537

se Mes MIE eciibsicnedtinasathcbiuideinitelabichesilobiesin 8, 14, 19, 20

Free Speech ex rel. Ruggiero v. Reno, 200 F.3d 63

CAE CEe. TIFF) GE CUMERME) ocacesscccscscccncecesesccsscsesssecees 9,10

Graver Tank & Mfg. Co. v. Linde Air Products Co.,

Fe Os Se ee nicki thichtaniiieaicanttn anitepiatinhietiinnsen 24

Grid Radio v. FCC, 278 F.3d 1314 (D.C. Cir. 2002)............. 9

Grosjean v. American Press Co., 297 U.S. 233 (1936) ....... 14

Mark v. FCC, 468 F.2d 266 (1st Cir. 1972) ........ccccceeeeseees 10

McConnell v. Federal Election Comm'n, 540 U.S. 93

SEEITTII scciciesienishsiilapietitaciatenaitinhseasiiuicnastsintGinnenliihiniieasiiulibieicdnaniieicaien 4

Minneapolis Star & Tribune Co. v. Minnesota Comm'r of

SOUR, GE ET BES CN ii aticittt sencitapadinariniinitintinaniine 14

Missouri v. Jenkins, 515 U.S. 70 (1995) .......ccccccsccsseeeesseeees 24

Muir v. Alabama Educ. Television Comm'n, 688 F.2d 1033

eS aia PIE ncichtiiccieersnnnsdenhsemnictenntebonssccsdiietibsiaadinudinaleibdas 10

Nat'l Broad. Co., Inc. v. United States, 319 U.S. 190

STII T sccntnainicniisntschctetnniansteeleedaiindanciiaigadiesebiiibdphidaneamabtianiaanantionend 4

Nat'l Collegiate Athletic Ass'n v. Smith, 525 U.S. 459

SST hci chet tliilcaileuineiiheelei ch thea cima 15

Prayze FM v. FCC, 214 F.3d 245 (2d Cir. 2000)...............00+. a

Radio-Television News Dir. Ass'n v. FCC, 184 F.3d 872

Seine Seis sit htrensensshiniecitastaianpidlaiataiiapinageishaita timininiiiiie 11

Red Lion Broad. Co. v. FCC, 395 U.S. 367 (1969) ...... passim

Ruggiero v. FCC, 317 F.3d 239 (D.C. Cir. 2003)............ 9,15

Scott v. Rosenberg, 702 F.2d 1263 (9th Cir. 1983).............. 10

Sinclair Broadcast Group, Inc. v. FCC, 284 F.3d 148

Siento: MEAs SNE bcceasnkciscninsnnenstenignasliaideimasndanisetiad 8, 19, 20, 24

State Oil v. Khan, $22 U.S. 3 (1997).......ccsccccccssssssssccsessecsesees 4

Syracuse Peace Council v. FCC, 867 F.2d 654

Sirti SanET SEIU UU insacsisuesnmeonnssenecintisndesadeetiniiibainihseildiaiettbibaaitonee 10

Telecomm. Research & Action Ctr. v. FCC, 801 F.2d 501

Es Gee Be eretenssemnssannis <sietininbhaia anal abaiasidialaaiiieiains 11

Time Warner Entertainment Co. v. FCC, 105 F.3d 723

eae Gates Oe cenincsscsisincsinitiniaiaiaitanabidadaensalatabbiinihinadiit 10

Vii

Time Warner Entertainment Co. v. United States, 211 F.3d

BE ites Gals PD ccicinssastncnscecsosace inahbiiiialinhacdiapnaked 16

Tribune Co. v. FCC, 133 F.3d 61 (D.C. Cir. 1988).............. 11

Turner Broadcasting System, Inc. v. FCC, 512 U.S. 622

SP SUaiisi asside Aki ialaanictanlbinbansaseliabtubaiicinnsiceaneinaenicanans 13, 16

United States v. Any and All Radio Station Transmission

Equip., 218 F.3d 543 (6th Cir. 2000) ...........cecesseesseeeeee 9

United States v. Any and All Radio Station Transmission

Equip., 207 F.3d 458 (8th Cir. 2000) ...........cceseeeseeeseeenee 9

United States v. Dunifer, 219 F.3d 1004 (9th Cir. 2000)....... 9

United States v. Mead Corp., 533 U.S. 218 (2001)... 18, 20

United States v. Szoka, 260 F.3d 516 (6th Cir. 2001).......... 10

US West, Inc. v. United States, 48 F.3d 1092

(9th Cir. 1994), vacated, 516 U.S. 1155 (1996)............. 14

Ward v. Rock Against Racism, 491 U.S. 781 (1989).......... aa

Statutes

EF Ree ie I adh badisndssicnhcseccadeshibanadteWabicecrsdsdiaxathisiadcia tlaintsh 6

Balanced Budget Act, Pub. L. No. 105-33, 111 Stat. 251

ITEP PE aisdskstnahnstiaidbbsninatdnpionicarinshaieentonnsiptenianiacnnkantannnabeasen 6

Children’s Television Act of 1990, Pub. L. No. 101-437,

I III css sits. cuidhieatanin bncaiscbninpandeanacocasdisennbin 5, 6

Consolidated Appropriations Act, Pub. L. No. 108-199, 118

Re RN a Ae ere ORE OE 7

Department of Commerce and Related Agencies

Appropriations of 2001, H.R. 5548, enacted by H.R.

4942, Pub. L. No. 106-553, 114 Stat. 2762 (2000).......... 7

Telecommunications Act of 1996, Pub. L. No. 104-104, 110

ie ee Re ETRE HATE AR DIRE 6, 18

DP ia cissacissniicintknsnsicihiiiasialisdahacianiisiiaidtvenbedeanatiibanmatns 20

OF TE iininsecssniosinca tackpubiccincealeianbocuaattaaeatel 18, 19, 20, 21

Legislative Authorities

Paice SRN, SIRT, WOE AUN nschencacsendiseniesnanehionoseuannanasemnsnsanbiccnannietioby 6

Pees NN. PO. RINE cccinstnstensninsinnnviieininniibietasiedeintaienades 6, 7

Administrative Authorities

2002 Biennial Regulatory Review, Report & Order and

Notice of Proposed Rulemaking, 18 F.C.C.R. 13620

GIFU sisivssicciasistsiiciebetinscntalatadenihdoheca ta uecaaacaiunsineciadibceddeiciniat passim

Rules Relating to Multiple Ownership of Standard, FM, and

Television Broadcast Stations, Second Report & Order,

50 F.C.C.2d 1046 (1975), vacated in part, KCMC, Inc.

v. FCC, 600 F.2d 546 (Sth Cir. 1979) wo... cee eeeeeee 11,12

Miscellaneous

Application for Renewal of Broadcast Station License

for WBTW, FCC File No. BRCT-20040802BIK

CP i, Be hisciiesieiiaitlicienicsieiitecniataicdanschaandiicienninimanniiees 17

Media General Opposition to Petition to Deny

Ss tg et iidininitaicacsinsenniannientnipiahintaniniinianiaines 17

Application for Renewal of Broadcast Station License

for WMBB, FCC File No. BRCT-20041001 AQF

iF re eiinnahiadiiealasencantineinadhniadintiniinpticondtiaiansiiees 17

Application for Renewal of Broadcast Station License

for WRBL, FCC File No. BRCT-20041210BZP

CE Ti Fah cccecacinssicciesciacasncceitidnapbii tintin 17

Karl M. Manheim & Lawrence B. Solum, An Economic

Analysis of Domain Name Policy, 25 Hastings Comm.

Se Bk, BB. BI AIO a iiss iciciitttiilbatiticanadsswnns 6, 7

News Release, FCC Announces Close to Unprecedented

FM Auction (Nov. 24, 2004)......ccccrccccccssssessecscssescsssscecees 7

Public Notice, Blanco, Texas Broadcast Auction No. 80

I Bi, Be witness ccinscesteccasntstnccnnncinanercciatasiodasns 7

I Ga te iis cdcininiecnacesnnetnntitsnnintanonanan ae

STATEMENT

Public Interest Respondents’ generally adopt the state-

ment of the United States in this case, and write separately to

underscore two additional points.

1. The court of appeals upheld much of the FCC’s 2002

Biennial Regulatory Review Order (“2002 Biennial’). Pet.

App. la-190a.2 The court’s comprehensive opinion properly

notes that the scope of judicial review of federal agency ac-

tion is “narrow” and that it is only authorized to remand an

agency decision when “it is not supported by substantial evi-

dence, or the agency has made a clear error in judgment.” Jd.

at 25a (internal citations omitted). For example, the court

upheld the FCC’s decisions to relax its cross-ownership ban,

id. at 40a, to retain the “top four” restriction on ownership of

local television stations, id. at 72a, to revise its definition of

local radio markets, id. at 85a, and to count “joint sales

agreements” toward a radio station’s permissible ownership

total; id. at 96a.

2. The court of appeals was unanimous in its disposition

of many key arguments raised by Petitioners and Cross-

! Public Interest Respondents are Prometheus Radio Project, Fairness

and Accuracy in Reporting, Center for Digital Democracy, Media Alli-

ance, Office of Communication of the United Church of Christ, Inc.,

Consumer Federation of America, Consumers Union, American Hispanic

Owned Radio Association, Civil Rights Forum on Communications Pol-

icy, League of United Latin American Citizens, Minority Business Enter-

prise Legal Defense and Education Fund, Minority Media and Telecom-

munications Council, National Asian American Telecommunications

Association, National Association of Latino Independent Producers, Na-

tional Coalition of Hispanic Organizations, National Council of La Raza,

National Hispanic Media Coalition, National Indian Telecommunications

Institute, National Urban League, Native American Public Telecommuni-

cations, Inc., PRLDEF—Institute for Puerto Rican Policy, Unity: Journal-

ists of Color, Inc., Women’s Institute for Freedom of the Press, and the

National Council of the Churches of Christ in the United States.

2 References are to the appendix filed by Petitioner in 04-1020.

Petitioners. The court unanimously rejected all of the consti-

tutional challenges raised by Petitioners. See Pet. App. 107a.

Chief Judge Scirica agreed with the majority on the proper

legal standards for review of agency decisions, compare id.

at 24a-26a, with id. at 116a-118a, but came to a different

conclusion as to the application of those standards to certain

specific rules.

REASONS TO DENY THE WRIT

Review by this Court would be premature. The court of

appeals neither forbade nor compelled the implementation of

specific rules; it simply remanded those rules that were with-

out factual record support or rational agency explanation.

Because many rules challenged by Petitioners are not ex-

pected to be retained on remand, review of those rules would

likely be unnecessary. Further, all of the rules at issue in this

case may be modified or repealed by the FCC during the next

congressionally-mandated review of media ownership rules,

which the FCC will conduct in 2006. This Court should not

expend its scarce judicial resources to pass on specific rules

that may be repealed or modified by the time its decision is

issued.

More importantly, despite the voluminous record below,

the proceeding did not focus on the core issue raised by many

Petitioners—whether spectrum scarcity continues to exist.

Accordingly, even assuming this Court should wish to revisit

this fact-dependent question, this case would be a poor vehi-

cle through which to do so.

Nor does this case present any broad, unsettled issues of

law for this Court to review. The court below did not an-

nounce any new principle of constitutional law; it simply ap-

plied doctrine that has been clearly established by this Court.

Petitioners present no valid reason for this Court to overrule

this precedent. Further, the Third Circuit’s interpretation of

the relevant statute’s standard of review provision is in com-

plete harmony with the explanation of the only other court of

appeals to have considered it.

Stripped of its constitutional and statutory rhetoric, this

case is simply about the application of properly articulated

administrative law principles to a complex factual record.

Such case-specific issues do not warrant this Court’s inter-

vention. Sup. Ct. R. 10.

I. PETITIONERS HAVE NOT DEMONSTRATED

_ ANY COMPELLING REASON TO OVERRULE

LONGSTANDING PRECEDENT

The appropriate standard of review for assessing the con-

Stitutionality of the FCC’s broadcast ownership rules was

decided by this Court in FCC v. National Citizens Committee

for Broadcasting, 436 U.S. 775 (1978) (“NCCB”). The court

of appeals properly applied the standards established in

NCCB to this case. Essentially conceding this point, three

Petitioners nonetheless urge this Court to reconsider and

overrule NCCB.

In NCCB, newspaper and broadcast station owners chal-

lenged the FCC’s then recently adopted newspaper-broadcast

cross-ownership rule, which was much more restrictive than

the rules at issue in this case. The Court rejected the argu-

ment that the cross-ownership rule violated the First

Amendment, finding that the argument “ignore[d] the fun-

damental proposition that there is no ‘unabridgeable First

Amendment right to broadcast comparable to the right of

every individual to speak, write, or publish.’” 436 U.S. at 799

(citing Red Lion Broad. Co. v. FCC, 395 U.S. 367, 388

(1969)). The Court observed that the “physical limitations

of the broadcast spectrum are well known” and that the num-

ber of frequencies used for broadcasting “is far exceeded by

the number of persons wishing to broadcast to the public.”

436 U.S. at 799.

This Court has repeatedly emphasized that the

reconsideration of previous decisions should be approached

with the utmost caution. See, e.g., State Oil Co. v. Khan, 522

U.S. 3, 20 (1997). Indeed, just last term, this Court explicitly

relied on Red Lion in upholding an important provision of the

Bipartisan Campaign Reform Act of 2002. McConnell v.

Federal Election Comm'n, 540 U.S. 93, 237 (2003).

Because, as shown below, Petitioners present no compelling

reason for this Court to reconsider its prior decisions, the

Court should deny certiorari.

A. Petitioners Have Presented No Compelling Reason

To Revisit NCCB’s Holding That Rational Basis Is

The Appropriate Standard For Review Of Broad-

cast Regulations

As far back as 1943, this Court rejected a constitutional

challenge brought by the broadcast networks against an FCC

ownership rule known as the “chain broadcasting rule.” The

Court recognized that “[uJnlike other modes of expression,

radio inherently is not available to all. That is its unique

characteristic, and that is why, unlike other modes of expres-

sion, it is subject to governmental regulation.” Nat'l Broad.

Co., Inc. v. United States, 319 U.S. 190, 226 (1943). Sub-

sequently, in Red Lion, the Court explained that “in view of

the limited number of available broadcasting frequencies,” it

did not violate the First Amendment for the FCC to require

broadcasters to serve the public interest by providing certain

types of programming. 395 U.S. at 394 (internal quotations

omitted).

1. Neither Congress Nor The FCC Have Signaled

That This Court Should Reconsider Its Ap-

proach to Broadcast Regulation

In FCC v. League of Women Voters of California, the

Court concluded that “[w]e are not prepared . . . to reconsider

our longstanding approach [of Red Lion] without some signal

from Congress or the FCC that technological developments

have advanced so far that some revision of the system of

broadcast regulation may be required.” 468 U.S. 364, 376

n.11 (1984). This signal has not been given.

a. In this very proceeding, the FCC reaffirmed its sup-

port for the scarcity doctrine. Responding to arguments

made by two of the present Petitioners, the FCC stated:

We disagree with Media General and Tribune, who

argue that our ownership rules affecting newspapers

should be judged under strict scrutiny First Amend-

ment analysis. Media General and Tribune claim that

spectrum scarcity is no longer a valid rationale for

media ownership limits .... [T]he courts have con-

sidered and consistently rejected the arguments for a

stricter standard of First Amendment scrutiny of

broadcast regulation made by commenters here. Ac-

cordingly, the rational basis test continues to apply to

our ownership rules.

Pet. App. 218a (2002 Biennial 915). As this makes evident,

the FCC is clearly not “signaling” this Court to reconsider

the scarcity doctrine.

b. Nor has Congress indicated a desire for the Court to

reconsider the scarcity doctrine. To the contrary, Congress

has enacted numerous laws imposing public interest require-

ments premised on the continued existence of scarcity, and in

some cases, reinforcing that scarcity.

For example, in the Children’s Television Act of 1990,

Congress explicitly found that as part of television stations’

obligations to serve the public interest, stations should pro-

vide programming serving the special needs of children.

Congress therefore directed the FCC to consider in renewing

television licenses the extent to which the licensee has served

the educational and informational needs of children. Chil-

dren’s Television Act of 1990, Pub. L. No. 101-437, §§

101(2), 103(a), 104 Stat. 996, codified in part at 47 U.S.C. §

303(a). See also H.R. Rep. No. 101-385 at 8 (citing Red Lion

and rejecting suggestions of constitutional difficulties with

Act).

In 1996, Congress added a new section to the Communi-

cations Act to establish a framework for the transition from

analog to digital television. Telecommunications Act of

1996, Pub. L. No. 104-104, § 201(a), 110 Stat. 56 (1996),

codified at 47 U.S.C. § 336 (“1996 Act”). Although this

transition offered the opportunity for awarding additional

broadcast licenses, Congress opted instead to limit eligibility

for digital television licenses to the existing licensees. 47

U.S.C. § 336(a)(1). At the same time, Congress reaffirmed

that television licensees were expected to continue to meet

their obligation to serve the public interest. Jd. at § 336(d).

Thus, if anything, the 1996 Act actually increased scarcity by

declining to make this spectrum available to new licensees.”

In 1997, Congress directed that the FCC utilize auctions

to award all new commercial broadcast licenses, shifting

away from a “comparative hearing” process whereby the

FCC evaluated each applicant before awarding a license.

Balanced Budget Act, Pub. L. No. 105-33, § 3301, 111 Stat.

251 (1997). This action was intended to address the ineffi-

ciencies of the hearing process that stemmed from the grow-

ing number of applications for new broadcast licenses. H.R.

Rep. No. 105-149 at 558; see also Karl M. Manheim & Law-

rence B. Solum, An Economic Analysis of Domain Name

Policy, 25 Hastings Comm. & Ent. L.J. 359, 439 (2003). In-

> Tribune claims that Congress’ requirement that the FCC redistrib-

ute spectrum after the digital television transition is complete demon-

strates that it no longer believes the spectrum is scarce. 04-1036 Pet. 17.

In fact, this leads to the opposite conclusion—if there were not more

would-be users than available frequencies, Congress would have no rea-

son to re-apportion the spectrum.

deed, the Balanced Budget Act relied upon spectrum scarcity

in requiring that minimum amounts be raised by each auc-

tion. H.R. Rep. No. 105-149 at 569-72 (setting minimum

amounts “[i]n recognition of the scarcity (and hence, the

value) of spectrum”). Both the use of auctions and the high

prices they generate* demonstrate that there continue to be

far more would-be broadcasters than can be accommodated

by the broadcast spectrum.

In 2000, Congress actually rolled back an FCC attempt to

award additional broadcast licenses through the creation of a

new, noncommercial low power FM radio service. A provi-

sion in the Department of Commerce and Related Agencies

Appropriations Act of 2001 limited the number of low-power

radio applications that the FCC could grant, due to concerns

that allowing more radio stations on the air would interfere

with existing broadcast stations. H.R. 5548 § 632, enacted

by H.R. 4942, Pub. L. No. 106-553, 114 Stat. 2762 (2000).

And finally, in early 2004, Congress passed legislation

rolling back the FCC’s relaxation of the national television

audience limits. Consolidated Appropriations Act of 2004,

Pub. L. No. 108-199, § 629, 118 Stat. 3 (2004). As part of

the 2002 Biennial, the FCC increased the percentage of the

national television audience that one company could “reach”

from 35% to 45%. Congress overruled the FCC’s decision

‘For example, the FCC’s first ever open auction of the FM broadcast

spectrum saw over 450 bidders participate, and resulted in 110 winning

bidders paying nearly $150 million for a portion of the spectrum. News

Release, FCC Announces Close to Unprecedented FM Auction (Nov. 24,

2004). The FCC noted that this auction “signifie[d] the continuing strong

demand for radio broadcast spectrum.” /d. In another example, eleven

bidders vied for a single television station license in Blanco, TX; the win-

ning bid approached $19 million. Public Notice, Blanco, Texas

Broadcast Auction No. 80 Closes (July 18, 2000). One reason for the

high prices generated by spectrum auctions is that “very few ‘new’

broadcast licenses are issued these days,” a fact that is “the consequence

of spectrum scarcity.” Manheim & Solum, supra, at 441.

and rolled the cap back to 39%. If Congress did not believe

that the spectrum was “scarce,” it would have no reason to

cap permissible ownership. As the D.C. Circuit explained,

“ijn the face of [the limited capacity of the spectrum], the

national ownership cap increases the number of different

voices heard in the nation .... But for the scarcity rationale,

that increase would be of no moment.” Fox Television Sta-

tions, Inc. v. FCC, 280 F.3d 1027, 1046, modified on reh'g,

293 F.3d 537 (D.C. Cir. 2002).

2. Spectrum Scarcity Continues To Exist As A

Matter Of Fact

Various Petitioners nonetheless argue that this Court

should reconsider NCCB and Red Lion because the factual

predicate of the scarcity doctrine has been eroded by the de-

velopment of cable television, direct broadcast satellites, and

the internet. 04-1020 Pet. 10-11, 04-1036 Pet. 16, 04-1045

Pet. 26. But, as the court of appeals correctly recognized,

“(t]he abundance of non-broadcast media does not render the

broadcast spectrum any less scarce.” Pet. App. 47a. Nor is

there any conflict among the Circuits on this point. The D.C.

Circuit recently rejected the same argument, noting that the

“protest that NCCB [and the scarcity doctrine] is no longer

controlling because it is undermined by the advent of cable

television, DBS, and the internet, is to no avail.” Sinclair

Broad. Group, Inc. v. FCC, 284 F.3d 148, 168-69 (D.C. Cir.

2002) (internal quotations and citations omitted); see also

American Family Ass'n, Inc. v. FCC, 365 F.3d 1156, 1169

(D.C. Cir. 2004) (noting that the number of frequencies that

can be productively used “is far exceeded by the number of

persons wishing to broadcast”).

Further evidence that there continue to be more would-be

broadcasters than frequencies available for licensing is

demonstrated by the large number of unlicensed broadcast

stations that have been shut down by the FCC in recent

——— ae

years.’ Likewise, Media General’s contention (04-1020 Pet.

12-13) that the scarcity doctrine has been undermined be-

cause this Court has not extended the doctrine to cable or

internet regulations misses the point. As the Red Lion’s scar-

city doctrine is based on the unique physical characteristics

of the broadcast spectrum, the fact that the doctrine has not

been extended beyond the broadcast arena in no way under-

cuts its viability in the broadcast arena. Spectrum scarcity

exists today in the same form that it did when this Court first

recognized the doctrine more than a half-century ago.° Fur-

ther review of this factual question, which was not addressed

by the FCC or the court of appeals and barely raised in the

huge administrative record, is unwarranted.

3. There Is No Conflict Among The Circuits Re-

garding The Scarcity Doctrine

Contrary to many Petitioners’ contentions, there is no

conflicting authority among the courts of appeals regarding

the scarcity doctrine or the appropriate level of scrutiny for

broadcast regulations. Every Circuit has recognized that

broadcasting regulation is subject to more deferential review

* See, e.g., Ruggiero v. FCC, 317 F.3d 239, 242 (D.C. Cir. 2003);

Grid Radio v. FCC, 278 F.3d 1314, 1316 (D.C. Cir. 2002); Prayze FM v.

FCC, 214 F.3d 245, 250 (2d Cir. 2000); United States v. Any and All Ra-

dio Station Transmission Equip., 218 F.3d 543, 549-50 (6th Cir. 2000);

United States v. Any and All Radio Station Transmission Equip., 207 F.3d

458, 459 (8th Cir. 2000); United States v. Dunifer, 219 F.3d 1004, 1005

(9th Cir. 2000); Free Speech ex rel. Ruggiero v. Reno, 200 F.3d 63, 64

(2d Cir. 1999) (per curiam).

* Media General claims (04-1020 Pet. 22) that because modern tech-

nology has increased the amount of spectrum available for use, scarcity

no longer exists. This is not the case. Red Lion’s observation that

“[a}dvances in technology . . . have led to more efficient utilization of the

frequency spectrum, but uses for the spectrum have also grown apace,”

395 U.S. at 396-97, remains true today with the tremendous growth in

cellular telephone service and other wireless services.

under the First Amendment due to the fact that more people

wish to broadcast than the spectrum can accommodate.

Tribune contends (04-1036 Pet. 13) that the Third Cir-

cuit’s suggestion that it would endorse the scarcity doctrine

“Tejven were [it] not constrained by Supreme Court prece-

dent,” Pet. App. 47a, somehow creates a conflict with the

D.C. Circuit. This is not so. While comments critical of the

scarcity doctrine have sometimes appeared in dissenting or

concurring opinions of the D.C. Circuit, see, e.g., Time War-

ner Entertainment Co. v. FCC, 105 F.3d 723, 724 n.2 (D.C.

Cir. 1997) (dissent from denial of rehearing en banc); Action

for Children’s Television v. FCC, 58 F.3d 654, 675 (D.C.

Cir. 1995) (“ACT”) (Edwards, C.J., dissenting); Syracuse

Peace Council v. FCC, 867 F.2d 654, 682-83 (D.C. Cir.

1989) (Starr, J., concurring), such comments are dicta, and

conflicts involving dicta do not merit certiorari. See, e.g.,

Bunting v. Mellen, 541 U.S. 1019, 124 S.Ct. 1750, 1754

(2004). Recognizing that Red Lion continues to “rule the

’ For example, the D.C. Circuit recently reviewed the FCC’s system

for awarding non-commercial educational broadcast licenses and held

that the scheme was subject to deferential review under the First

Amendment. It concluded that “(rjegulation of some form is an irreduci-

ble feature of any broadcast spectrum worth having, since ‘a finite num-

ber of frequencies can be used productively; this number is far exceeded

by the number of persons wishing to broadcast to the public.’”” American

Family Ass’n, 365 F.3d at 1169 (quoting NCCB, 436 U.S. at 798). See

also Mark v. FCC, 468 F.2d 266, 269 (ist Cir. 1972); Free Speech ex rel.

_ Ruggiero v. Reno, 200 F.3d 63, 64 (2d Cir. 1999) (per curiam); Adventure

Communications, Inc. v. Kentucky Registry of Election Fin., 191 F.3d

429, 439-40 (4th Cir 1999); Muir v. Alabama Educ. Television Comm'n,

688 F.2d 1033, 1039, 1043 (Sth Cir. 1982); United States v. Szoka, 260

F.3d 516, 526 (6th Cir. 2001); Chicago Cable Communications v. Chi-

cago Cable Comm'n, 879 F.2d 1540, 1548 (7th Cir. 1989); Black Hills

Video Corp. v. FCC, 399 F.2d 65, 69 (8th Cir. 1968); Scott v. Rosenberg,

702 F.2d 1263, 1272 (9th Cir.1983); Cmty. Communications Co., Inc. v.

City of Boulder, Colo., 660 F.2d 1370, 1376 n.5 (10th Cir. 1981); Jn re

Beach Television Partners, 38 F.3d 535, 536 (11th Cir. 1994).

oe nee

;

cece taeasaaass ieee

broadcast jungle,” Tribune Co. v. FCC, 133 F.3d 61, 69

(D.C. Cir. 1988), the D.C. Circuit has consistently and prop-

erly applied the scarcity doctrine. See, e.g., American Family

Ass 'n, 365 F.3d at 1168; Radio-Television News Dir. Ass'n v.

FCC, 184 F.3d 872, 877 n.3 (D.C. Cir. 1999) (“RTNDA”);

Telecomm. Research & Action Ctr. v. FCC, 801 F.2d 501,

509 (D.C. Cir. 1986) (“TRAC”). Thus there is simply no

conflict for this Court to review.

B. Petitioners Have Presented No Compelling Reason

To Revisit NCCB’s Equal Protection Holding

Certain Petitioners also challenge the court of appeals’

decision that rules barring newspapers from owning broad-

cast stations do not impermissibly discriminate in violation

of the First or Fifth Amendment. As with the scarcity doc-

trine, this Court has already addressed this issue. In NCCB,

the Court upheld a ban on newspaper-broadcast cross-

ownership against an equal protection challenge, finding the

regulations to be a “reasonable means” of promoting the

FCC’s objectives. 436 U.S. at 801-02. Indeed, even Media

General acknowledges (04-1020 Pet. 24) that the NCCB

Court rejected the argument that the cross-ownership regula-

tions unfairly single out newspaper owners.

1. Nonetheless, Media General and Tribune argue that

this Court should reconsider NCCB because “in NCCB’s day,

the only other ‘major media of mass communications’ be-

sides newspapers were broadcast television and radio,” while

today other forms of mass media such as cable and internet

are available. 04-1020 Pet. 24; see also 04-1036 Pet. 20.

This misreads NCCB. The cross-ownership rule at issue in

NCCB was not intended to diversify all major media of mass

communication; rather, the FCC sought to regulate media

cross-ownership to promote diversity of viewpoints within

local communities. 436 U.S. at 786 (citing Rules Relating to

Multiple Ownership of Standard, FM, and Television Broad-

cast Stations, Second Report & Order, 50 F.C.C.2d 1046,

1075 (1975) (“1975 Order’)). The FCC excluded certain

types of mass media, such as magazines and other periodicals

that “dealt exclusively with regional or national issues and

ignored local issues.” 1975 Order, 50 F.C.C.2d at 1080

4112; see also NCCB, 436 U.S. at 787 n.10. Thus, in 1975,

the FCC recognized that other major mass media existed, but

chose to restrict common ownership of only those media that

covered local issues—specifically newspapers, broadcast

television, and broadcast radio.

Similarly, in the 2002 Biennial, the FCC sought to “pre-

serv[e] viewpoint diversity among local, not national, news

sources.” Pet. App. 484a-485a (2002 Biennial $399). Thus,

the FCC excluded “the large number of national news

sources such as all-news cable channels and the news sources

on the Internet.” Jd. (emphasis added). Finding that “broad-

cast television, daily newspapers, and broadcast radio” con-

tinue to be “the three media platforms that Americans turn to

most often for local news and information,” id. at 520a (2002

Biennial $452), the FCC appropriately limited the cross-

media limits to the media that are the most significant

sources of local news.

Petitioners Newspaper Association of America, Belo

Corp., Gannett Co., Inc., and Morris Communications Com-

pany, LLC (“NAA”) (04-1045 Pet. 27), along with Media

General (04-1020 Pet. 25), also claim that the specific cross-

ownership regulations adopted in the 2002 Biennial violate

_ N€CB’s equal protection holding because they treat newspa-

per owners somewhat differently than radio and television

station owners. Again, these Petitioners misread NCCB.

NCCB merely required the cross-ownership regulations re-

viewed below to treat newspaper and broadcast owners “in

essentially the same fashion.” 436 U.S. at 801 (emphasis

added). As with the rules at issue in NCCB, the cross-

ownership regulations treat newspaper and broadcast owners

— —

essentially the same way in that all are restricted in their abil-

ity to own another type of local media. See Pet. App. 452a.

Moreover, contrary to Media General’s absolute statement

that “a cable company may buy a broadcast station even

where a newspaper may not,” 04-1020 Pet. 24, a newspaper

Owner may receive a waiver of the rule to co-own a broadcast

station in certain circumstances. Pet. App. 437a (2002 Bien-

nial 9481).

~ 2. The court of appeals’ decision not to apply height-

ened scrutiny to the cross-ownership regulations does not

conflict with any decision of this Court. The NCCB Court

did not apply heightened scrutiny in its disposal of the equal

protection challenges, but rather found that content-neutral

regulations that prevent any person from owning both a

newspaper and a broadcast station are a “reasonable means

of promoting the public interest in diversified mass commu-

nications.” 436 U.S. at 802 (emphasis added).

Moreover, NCCB’s use of rational basis review is fully

consistent with this Court’s recent jurisprudence. Tribune

and Cross-Petitioner Sinclair Broadcast Group, Inc. (‘Sin-

clair’) rely (04-1036 Pet. 21-22, 04-1177 Pet. 15) on Turner

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

(“Turner I’) to argue that any regulation that distinguishes

between classes of media outlets demands heightened scru-

tiny. However, this argument is directly precluded by Turner

Ps admonition that “[i]t would be error to conclude . . . that

the First Amendment mandates strict scrutiny for any speech

regulation that applies to one medium (or a subset thereof)

but not others.” 512 U.S. at 660. Turner I’s touchstone for

determining the level of scrutiny is the type of medium;

“heightened scrutiny is unwarranted when the differential

treatment is justified by some special characteristic of the

particular medium being regulated.” Jd. at 660-61 (internal

citations omitted). As the cross-ownership restrictions apply

to broadcast media, the “special characteristic” of spectrum

scarcity makes heightened scrutiny unwarranted.

The other cases relied upon by Tribune (04-1036 Pet. 21-

23; see also 04-1177 Cross-Pet. 15) are inapposite to the

question of the proper standard of review of content-neutral

broadcast regulations. League of Women Voters applied

heightened scrutiny because the statute in question was a

content-based speech restriction. 468 U.S. at 383.8 Minnea-

polis Star & Tribune Co. v. Minnesota Commissioner of

Revenue, 460 U.S. 575 (1983), considered the constitutional-

ity of a tax imposed only on newspapers, and is directly

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

(1936), which the NCCB Court held not to be controlling on

the question of cross-ownership regulations, 436 U.S. at 801.

Finally, the two court of appeals decisions cited by Tribune

(04-1036 Pet. 22-23) concerned regulation of telephone com-

panies, and both cases expressly recognized that broadcast

ownership regulations receive a different and lower level of

constitutional scrutiny.’

® See also Fox Television Stations, 280 F.3d at 1046 (rejecting

heightened scrutiny because the rule at issue, “unlike the [rule] at issue in

League of Women Voters, is not a content-based regulation; it is a regula-

tion of industry structure, like the newspaper/broadcast cross-ownership

rule the Court concluded was content-neutral in NCCB’”).

* Further, both cases were vacated by this Court. US West, Inc. v.

United States, 48 F.3d 1092, 1098 (9th Cir. 1994), vacated, 516 U.S.

1155 (1996); Chesapeake & Potomac Tel. Co. v. United States, 42 F.3d

181, 191 (4th Cir. 1994), vacated, 516 U.S. 415 (1996) (per curiam).

C. The Court Below Did Not Address Whether

Cross-Ownership Regulations Are Content-Based;

Nor Have Petitioners Presented Compelling Rea-

son To Revisit NCCB’s Holding That Such Regula-

tions Are Content-Neutral

Media General’s and Tribune’s contention (04-1020 Pet.

26; 04-1036 Pet. 23) that the cross-ownership regulations

should have been subjected to heightened scrutiny because

they are content-based restrictions on speech likewise pro-

vides no basis for reconsidering NCCB. As a threshold mat-

ter, review of this argument is inappropriate because it was

not addressed in the decision below. This Court “dofes] not

decide in the first instance issues not decided below.” Nat’l

Collegiate Athletic Ass'n v. Smith, 525 U.S. 459, 470 (1999).

Certiorari is also unnecessary because this Court has al-

ready addressed the question, specifically holding that news-

paper-broadcast cross-ownership regulations “are not content

related.” NCCB, 436 U.S. at 801. Lower courts have prop-

erly followed that decision, recognizing that cross-ownership

rules are simply structural regulations that receive minimal

constitutional scrutiny. See, e.g., American Family Ass'n,

365 F.3d at 1169; Ruggiero, 317 F.3d at 244.

In any event, the court of appeals’ decision that the struc-

tural cross-ownership regulations are not content-based is

correct. As this Court has explained, “[tJhe principal inquiry

in determining content neutrality . . . is whether the govern-

ment has adopted a regulation of speech because of dis-

agreement with the message it conveys.” Ward v. Rock

Against Racism, 491 U.S. 781, 791 (1989). The cross-

ownership regulations were not at all motivated by the mes-

sage of the speaker, but rather were developed to ensure a

diversity of media voices was available to the public. Pet.

App. 481a-482a (2002 Biennial 4393-94). “[B]y placing a

value upon diversity the FCC did not necessarily . . . value

one speaker, or one type of speech over another; it merely

expressed its intention that there continue to be multiple

speakers.” American Family Ass'n, 365 F.3d at 1169 (inter-

nal quotations omitted).

The D.C. Circuit has held that analogous regulations of

the structure of cable ownership that were motivated by di-

versity concerns were not content-based. In Jime Warner

Entertainment Co. v. United States, the court noted that “[a]s

the Supreme Court made quite clear in Turner IJ, . . . making

way for some speakers” in a context like broadcasting

“where that necessarily means limiting the speech of others,

is not inherently content-based.” 211 F.3d 1313, 1317 (D.C.

Cir. 2000). This same, traditional rationale clearly applies to

the present regulations—trules restricting broadcast owner-

ship to promote a diversity of media outlets are not subject to

heightened First Amendment scrutiny.

D. Should The Court Wish To Reconsider Its Consti-

tutional Precedent, Other Cases Offer A Better

Opportunity For Fully Assessing The Issues

The 2002 Biennial focused on specific ownership rules

and not the factual underpinnings of the scarcity doctrine.

Any reference to the continued existence of spectrum scarcity

was an inconsequential piece of a massive record, and the

factual basis for doctrine was not addressed on the merits by

the FCC or the court of appeals. Re-examination of the scar-

city doctrine would be a fact-intensive process. The present

case plainly does not afford this Court a sufficient record or

factual basis for such a task.

Moreover, as a practical matter, this case does not present

an actual cross-ownership rule for constitutional review. Be-

cause the court below agreed with the FCC that the original

newspaper-broadcast cross-ownership rule was no longer

necessary, see Pet. App. 40a, there is no need to re-evaluate

the constitutionality of that rule. On the other hand, since the

court found that the replacement rule adopted by the FCC

was arbitrary and capricious and subject to further proceed-

ings on remand, it would make no sense to evaluate the con-

stitutionality of that rule at this time.

Further, the FCC has before it at least three licensing

cases that squarely present the issue of whether the cross-

ownership prohibition is constitutional. Specifically, Media

General has filed license renewal applications asking the

FCC to waive the newspaper-broadcast cross-ownership rule

to allow it to continue to own both a daily newspaper and a

television station in the Myrtle Beach-Florence, South Caro-

lina, Panama City, Florida, and Columbus, Georgia DMAs,’°

In making its waiver requests, Media General argues that

spectrum scarcity no longer exists and thus the cross-

ownership rules are unconstitutional. See, e.g. Application

for Renewal of Broadcast Station License for WBTW, Media

General Opposition to Petition to Deny 39-44 (Dec. 14,

2004). Because these cases present the issue in specific, con-

crete factual settings, yet do not raise the wide variety of is-

sues presented in the 2002 Biennial, any one would present a

better vehicle for revisiting the constitutional issues raised by

Petitioners in this case, should this Court be inclined to do so.

II. THERE IS NO CONFLICT OVER THE INTER-

PRETATION OF §202(h) OF THE 1996 TELE-

COMMUNICATIONS ACT

Petitioner National Association of Broadcasters (“NAB”),

along with Tribune, NAA, and Respondent Clear Channel

Communications, Inc. (“Clear Channel”)'! assert there is a

'° Application for Renewal of Broadcast Station License for WBTW,

FCC File No. BRCT-20040802BIK (Aug. 6, 2004), Application for Re-

newal of Broadcast Station License for WMBB, FCC File No. BRCT-

20041001 AQF (Oct. 7, 2004), Application for Renewal of Broadcast Sta-

tion License for WRBL, FCC File No. BRCT-20041210BZP (Dec. 8,

2004).

' Clear Channel is a Respondent in 04-1033.

circuit split with respect to the FCC’s construction of §202(h)

of the 1996 Act. This is not so. All three members of the

panel agreed that the court of appeals’ construction is consis-

tent with that of the D.C. Circuit. Their ruling that the peri-

odic review mandated by §202(h) should employ the normal

arbitrary and capricious test generally required by the Ad-

ministrative Procedure Act is clearly correct and should not

be disturbed. Nor is there reason for this Court to examine

the court of appeals’ unanimous conclusion that §202(h) al-

lows the FCC to adopt stronger rules at the conclusion of the

review process.

Although each of the petitioners emphasize the deregula-

tory thrust of the 1996 Act, there is no suggestion that the

ruling below conflicts with any other circuit on this point.

See Pet. App. 34a (majority noting that 1996 Act is deregula-

tory); Pet. App 122a (concurring judge noting the “deregula-

tory flavor” of the 1996 Act). Nor do any of the Petitioners

point to express language in any statute that prohibits the

FCC from increasing its regulatory oversight when the record

justifies such action. Under this Court’s jurisprudence, the

FCC is entitled to deference in construction of statutory am-

biguities such as this, see, e.g., United States v. Mead Corp.,

533 U.S. 218, 229 (2001), and the petitions surely do not

raise an issue here that would support issuance of a writ of

certiorari.

1. Tribune, NAA, Sinclair, and Clear Channel argue that

the Third Circuit’s holding that §202(h) does not impose a

more exacting standard of review is in conflict with that of

the D.C. Circuit. See 04-1036 Pet. 24-26; 04-1045 Pet. 19-

23; 04-1177 Cross-Pet. 11-12; Clear Channel Br. 24-27.

These arguments mischaracterize the sequence in which the

FCC and the D.C. Circuit acted and downplay the D.C. Cir-

cuit’s definitive decision in Cellco Partnership v. FCC, 357

F.3d 88 (D.C. Cir. 2004). As the Third Circuit joined Cellco

ee ee

in holding that the phrase “necessary in the public interest” !

did not create a deregulatory presumption, and “endorsing

the [FCC]’s view that ‘necessary’ must mean the same thing

in the periodic review context as in the rulemaking context,”

Pet. App. 31a, there is no conflict.'?

Clear Channel’s quotations of fragments from Cellco are

misleadingly incomplete, as can be seen by reference to the

complete passages from which Clear Channel quotes. For

example, Clear Channel claims that Cellco, “expressly ex-

tended to Section 11 the ‘presumption in favor of repealing

or modifying covered rules’ that the D.C. Circuit had found

inherent in Section 202(h).” Clear Channel Br. at 26 (quoting

Cellco, 357 F.3d at 97). What Cellco actually said was that

“the [FCC] agreed that where §11's conditions are met, §11

creates a presumption in favor of repealing or modifying” the

"2 The provision directly at issue in Cellco was §11 of the 1996 Act,

a biennial review provision that, just like §202(h), requires the FCC to

repeal or modify regulations no longer “necessary in the public interest.”

" Petitioners rely on the D.C. Circuit’s pre-Cellco decisions in Fox

Television Stations, Inc. v. FCC, 280 F.3d 1027 (D.C. Cir. 2002) (“Fox

I”), and Sinclair v. FCC, 284 F.3d 148 (D.C. Cir. 2002) (“Sinclair’).

However, the D.C. Circuit later modified the Fox J decision to “leave

unresolved precisely what §202(h) means.” Fox Television Stations, Inc.

v. FCC, 293 F.3d 537, 540 (D.C. Cir. 2002) (“Fox IP’). Moreover, Cellco

explicitly discussed and harmonized its ruling with those in Fox J, Fox II

and Sinclair. 357 F.3d at 97-98. The Cellco panel pointed out that

“shortly after Sinclair was decided, the court in [Fox IT] retracted Fox I's

definition of ‘necessary”” and that “the court in Sinclair did not adopt a

general presumption in favor of modification or elimination of regula-

tions.” 357 F.3d at 98. Thus, for example, when NAB refers (04-1033

Pet. 22, see also 04-1036 Pet. 24, 04-1045 Pet. 19) to Fox J and Sinclair

as imposing “a presumption in favor of repealing or modifying the own-

ership rules,” it ignores the subsequent Cellco, ruling, which specifically

stated that “neither Fox J nor Sinclair adopted a controlling definition of

‘necessary,’ much less the position that §11 embodies a presumption in

favor of deregulation.” 357 F.3d at 98. Importantly, the 2002 Biennial,

which purports to rely on Fox J and Sinclair, Pet. App. 215a (2002 Bien-

nial 411), was issued prior to the Cellco decision.

tules. 357 F.3d at 97 (emphasis added). Indeed, there is no

dispute within or among the circuits that when a regulation is

found no longer to be in the public interest that there is a pre-

sumption in favor of repeal or modification. See id. at 99.

Similarly, although Clear Channel claims that Cellco im-

poses obligations that go “beyond [the FCC’s] normal moni-

toring responsibilities,” Clear Channel Br. at 26 (quoting

Cellco, 357 F.3d at 99), the decision’s preceding sentence

makes clear that the Cellco court.was referring to remedies,

not the threshold test. 357 F.3d at 99 (“The [FCC] reasona-

bly concluded that the deregulatory presumption arises only

after it has determined under §11(a) that a regulation is no

longer necessary in the public interest.”).

2. NAB, supported by Clear Channel, presents a second

statutory argument, claiming that the deregulatory goals of

the 1996 Act permit the FCC only to deregulate and pre-

cludes it from ever tightening its radio ownership regulations

at the conclusion of a biennial review. 04-1033 Pet. 19-26;

Clear Channel Br. 20-24. There is no suggestion of a circuit

conflict on this point, and no specific statutory provision

governs this question. This, then, is also an issue as to which

the FCC is entitled to substantial deference. See, e.g.,. Mead,

533 U.S. at 229.

NAB argues (04-1033 Pet. 22) that “Sections 202(b) and

202(h) together express a clear directive that local ownership

restrictions not be tightened,” but none of the language it

cites from the statute or the D.C. Circuit’s Fox and Sinclair

decisions addresses the particular issue presented here. To

say that “Congress set in motion a process to deregulate the

structure of the broadcast and cable industries,” 04-1033 Pet.

22 (quoting Fox J, 280 F.3d at 1033), is not inconsistent with

an agency determination that the deregulatory process can be

accomplished with one step backward and three steps for-

ward.

Both NAB and Clear Channel likewise maintain that the

phrase “repeal or modify” must be read so that “modify”

means only “that the [FCC] can relax existing restrictions; it

does not authorize the [FCC] to tighten them.” 04-1033 Pet.

23; see also Clear Channel Br. 20, and that the court of ap-

peals ruling “conflicts with the text and structure of Section

202 as a whole.” Clear Channel Br. 21. There is no basis to

disturb the court of appeals’ holding on this point. As the

panel majority reasonably explained, the deregulatory goal of

§202(h) is fulfilled by “requir[ing] the [FCC] periodically to

justify its existing regulations, an obligation it would not oth-

erwise have.” Pet. App. 34a. See also id. at 124a (“Despite

§202(h)’s admittedly deregulatory tenor, the statute does not

foreclose the possibility of increased regulation under the bi-

ennial review if the [FCC] finds such action in the public in-

terest.”) (Scirica, C.J., concurring in part and dissenting in

part). There is nothing important or novel about this garden

variety question of statutory construction, or the resolution of

it below, much less anything which would rise to the level of

significance to merit this Court’s attention.

Ill. ROUTINE APPLICATION OF WELL-SETTLED

ADMINISTRATIVE LAW STANDARDS DOES

NOT MERIT THIS COURT’S INTERVENTION

1. Both NAA and the Government’s Conditional Cross-

Petition contend (04-1045 Pet. 23-25; 04-1168 Cross-Pet. 21-

28) that the court of appeals did not afford sufficient defer-

ence to the FCC’s decisionmaking.'* Yet neither claims that

“* The deference claim is not raised by other industry Petitioners.

Like Public Interest Respondents, many industry Petitioners argued to the

court below that certain FCC decisions were arbitrary and Capricious. See

Pet. App. 52a (industry petitioners argued exclusion of cable but inclu-

sion of internet in diversity index arbitrary and capricious); 58a (industry

petitioners argued “equal market shares” assumption arbitrary and capri-

cious); 103a (industry petitioners argued specific local radio limits arbi-

trary and capricious).

the court failed to articulate the correct deference standards.

See 04-1045 Pet. 24; 04-1168 Cross-Pet. 23,27. Indeed, the

court below correctly noted that its scope of review was nar-

row, Pet. App. 25a, that it was not to substitute its judgment

for that of the agency, id., and that “[djeference to the

[FCC]’s judgment is highest when assessing the rationality of

the agency’s line-drawing endeavors,” id. at 62a. The court

remanded only when the agency’s decision was “not sup-

ported by substantial evidence.” Jd. at 25a. Importantly,

there was no disagreement between the majority and Chief

Judge Scirica about the proper legal standards, compare id. at

24a-26a, with id. at 116a-118a; the only disagreement was

over the application of those standards to specific rules at is-

sue. At bottom, NAA and the Government simply quarrel

over this application of law to fact. That issue does not merit

review. Sup. Ct. R. 10.

2. Notwithstanding the fact that this issue does not war-

rant intervention by this Court, the court of appeals’ decision

to remand certain rules was correct. The Government claims

(04-1168 Cross-Pet. 21) that the court of appeals should have

deferred to the FCC’s decision to assume equal market shares

for outlets within the same media. The flaw in this argument,

as the court observed, is that this equal market share assump-

tion conflicted with other parts of the 2002 Biennial, where

the FCC expressly found that there was “no reason to believe

that all media are of equal importance.” Pet. App. 59a (quot-

ing 2002 Biennial 4409). The court correctly pointed out

that “the assignment of equal market shares generates absurd

results,” such as the Dutchess Community College television

station receiving a market share equal to New York City’s

ABC affiliate and higher than the New York Times. Pet.

App. 59a. In sum, the court found that “assuming equal

market shares [is] unrealistic and inconsistent with the

[FCC]’s overall approach .. . and proffered rationale,” and

thus it properly remanded that decision. Jd. at 61a.

The Government also questions (04-1168 Cross-Pet. 24)

the deference given to the FCC’s decision to give substantial

weight to the internet in the FCC’s Diversity Index. Once

again, however, the court appropriately remanded in light of

the FCC’s failure to explain obvious inconsistencies. The

court correctly noted that the FCC’s rationale for excluding

cable television from the Diversity Index also necessarily ap-

plied to the internet. See Pet. App. 52a-58a. For example,

while the FCC discounted cable where a survey suggesting

that cable was a source of local news conflicted with other

record evidence, the FCC failed to discount the internet under

analogous circumstances. Jd. at 55a.'* Because the similari-

ties between cable television and the internet required consis-

tent treatment, the court properly found that the “decision to

count the Internet as a source of viewpoint diversity, while

discounting cable, was irrational.” Jd. at 52a.

Finally, the Government challenges (04-1168 Cross-Pet.

27-28) the court of appeals’ review of specific limits chosen

regarding cross-media and local radio station ownership. But

in fact the court upheld many of the FCC’s line-drawing de-

cisions, see id. at 75a (upholding “top-four restriction” on

local TV ownership), 85a (upholding local radio market defi-

nition), only remanding those that were marred by inconsis-

tencies. For example, the specific limits created by the FCC,

purportedly developed to prevent “problematic levels of con-

centration,” id. at 509a (2002 Biennial 9435), would have

allowed certain media combinations resulting in considerably

higher concentration levels than others that were prohibited.

The court correctly held that “[t]he [FCC]’s failure to provide

any explanation for this glaring inconsistency is without a

'S Further, the court noted that the FCC’s attempt to justify the dif-

ferential treatment by arguing that local cable news is not available to

everyone while the internet is was inconsistent with the FCC’s recogni-

tion (elsewhere in the 2002 Biennial) that nearly one-third of Americans

have no internet access. Pet. App. at 57a-58a.

doubt arbitrary and capricious.” Jd. at 63a. Thus, while the

court properly engaged in highly deferential review of spe-

cific limits chosen by the FCC, it did not abdicate its respon-

sibility to remand when the lines drawn were not supported

by the record and therefore “patently unreasonable.” Sin-

clair, 284 F.3d at 162."

It is a truism that this Court is “‘[a] court of law . . . rather

than a court for correction of errors in fact finding.’” Mis-

souri v. Jenkins, 515 U.S. 70, 162 (1995) (Souter, J., dissent-

ing) (quoting Graver Tank & Mfg. Co. v. Linde Air Prod.

Co., 336 U.S. 271, 275 (1949)). As the decision below rests

upon a correct understanding of this Court’s principles of

administrative deference, Petitioners’ contention is simply

that the court of appeals misapplied the law to the facts of

this case. As explained above, that case-specific issue does

not merit this Court’s attention.

'® The Government also challenges (04-1168 Pet. 27-28) the remand

of the FCC’s specific local radio ownership limits. Once again, the court

of appeals remanded these limits because of the irrational and incunsis-

tent manner in which they were developed. For example, the court

pointed out that the FCC failed to explain why it ignored the DOJ/FTC

Merger Guidelines in developing the local radio limits, but expressly re-

lied on the Guidelines in developing analogous local television ownership

limits. Pet. App 103a. Further, while the rationale for the local radio

ownership limits depended heavily on the theory that a certain number of

equal-sized competitors would make a market competitive, the court cor-

rectly noted that “record evidence supports neither actual nor potential

existence of equal-sized competitors” in the local radio market. Jd.

CONCLUSION

For the foregoing reasons, this Court should deny the

petitions for a writ of certiorari.

Respectfully submitted,

ANGELA J. CAMPBELL ANDREW JAY SCHWARTZMAN*

KAREN HENEIN MEDIA ACCESS PROJECT

INSTITUTE FOR PUBLIC Suite 1000

REPRESENTATION 1625 K Street, NW

GEORGETOWN Washington, DC 20006

UNIVERSITY LAW CENTER (202) 232-4300

600 New Jersey Ave., NW

Suite 312 GLENN B. MANISHIN

Washington, DC 20001 KELLEY DRYE & WARREN,

(202) 662-9535 LLP

8000 Towers Crescent Drive,

DAVID HONIG Suite 1200

NICOLAINE LAZARRE Vienna, VA 22812

MINORITY MEDIA & (703) 918-2322

TELECOMMUNICATIONS

COUNCIL SHELBY D. GREEN

3636 16 St. NW, #B-366 PACE UNIVERSITY SCHOOL

Washington, DC, 20010 OF LAW

(202) 332-7005 78 No. Broadway

White Plains, NY 10603

(914) 422-4421

May 2, 2005 * Counsel of Record

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.