Petition for Writ of Certiorari — Horton v. City of Houston

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03156 3 MAY 18 2008

No.

OFFICE Of THE CLERK

In The

Supreme Court of the United States

“2

ROBERT HORTON, NATIONALIST

TELEVISION, a Texas Non-Profit Corporation;

and BARRY HACKNEY,

Petitioners

VS.

CITY OF HOUSTON, TEXAS and

ACCESS HOUSTON CABLE CORPORATION,

Respondents

ON PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

“9°

PETITION FOR A WRIT OF CERTIORARI

“~

RICHARD BARRETT

Counsel of Record

P O Box 2050

LEARNED MS 39154

(601) 885-2288

Attorney for Petitioners

QUESTION PRESENTED

Whether a rule for the charging of selective, arbitrary

and standardless fees for the broadcasting of non-locally-

produced programs over public-access cable-television,

which constricts diversity of information sources and ser-

vices, necessarily considering content, violates the Cable

Television Policy Act of 1984, the Equal Protection Clause

of the Fourteenth Amendment and the First Amendment,

.S invalid on its face or as applied.

PARTIES TO THE PROCEEDINGS

Petitioners

Nationalist Television, a Texas non-profit corporation;

Robert Horton; and, Barry Hackney.

Respondents

City of Houston, a Texas municipal corporation, and

Access Houston Cable Corporation, a Texas corporation

TABLE OF CONTENTS

pp Ae eee eos ill

py ke a A Sg) 60g | Vv

PETITION FOR WRIT OF CERTIORARI .......... l

STATEMENT OF JURISDICTION ................ 2

CORPORATE DISCLOSURE STATEMENT ....... 2

CONSTITUTIONAL PROVISIONS ............... 2

EE rg cere eee 3

LOCAL RULES OF PROCEDURE ................ 5

eimeemen) OF THECASE .................... 6

REASONS FOR GRANTING Tea FRAT... 9

I. THE RULE FOR THE CHARGING OF

SELECTIVE, ARBITRARY AND STAND-

ARDLESS FEES FOR THE BROAD-

CASTING OF NON-LOCALLY PRO-

DUCED PROGRAMS OVER PUBLIC-AC-

CESS CABLE-TELEVISION, WHICH

CONSTRICTS DIVERSITY OF INFOR-

MATION SOURCES AND SERVICES,

NECESSARILY CONSIDERING CON-

TENT, VIOLATES THE FIRST AMEND-

MENT AND IS INVALID ON ITS FACE

oe eo): ri re 11

I]. THE RULE FOR THE CHARGING OF

FEES FOR THE BROADCASTING OF

NON-LOCALLY PRODUCED PRO-

GRAMS OVER PUBLIC-ACCESS CA-

BLE-TELEVISION, WHICH CREATES A

CATEGORY FOR THOSE WHO CAN

PAY TO BROADCAST VERSUS THOSE

WHO CANNOT AFFORD TO PAY AND,

THEREFORE, CANNOT BROADCAST,

VIOLATES THE EQUAL PROTECTION

CLAUSE OF THE FOURTEENTH A-

MEI oe 20

CONCIII 23

I be ee ee App. |

A. APPEALS’ COURT OPINION

WE 5h oa eck ees aeeen App. |

B. APPEALS’ COURT MANDATE

WEE Fo Fie es chee App. 3

C. DISTRICT COURT OPINION

on in) SEO ee ree App. 5

D. APPEALS COURT OPINION

Horton I

E. DISTRICT COURT OPINION’

os Nr aN Ae App. 56

TABLE OF AUTHORITIES

Cases

Arkansas Writers’ Projeci, Inc. v. Ragland,

SSE ELD. Bae Cee ia Peake wer heees 19

Associated Press v. United States, 326 U.S. 1

CRY 6 ccawen tlawene eee oe ee ea 17

Boos v. Barry, 485 U.S. 312 (1988) ............... 13

Bose Corp. v. Consumers Union of United

States, Inc., 466 U.S. 485 (1984) ............ 18

Broadrick v. Oklahoma, 413 U.S. 601 (1973) ....... 13

Buckley v. Valeo, 424 U.S. 1 (1976) .............. 22

Chicago Cable Communications v. Chicago

Cable Com’n, 879 F.2d 1540 (7th Cir.

1989), cert. den. 493 U.S. 1044 (1990) ....... 12

City of Lakewood v. Plain Dealer Publ’g,

666 1S. THOU Ree oss a ee ee eee 12

City of Los Angeles v. Preferred

Communications, 476 U.S. 488 (1986)....... 1]

Columbia Broadcasting System, Inc. v.

Democratic National Committee,

SUD US. PRES lee eo cs eae ehas anne 20, 21

Vii

Community Communications Corp. v.

City of Boulder, 660 F.2d 1370

SE 0 aye as why chase eh bcs 18

Connick v. Myers, 461 U.S. 138 (1983) ............ 23

Cox v. New Hampshire, 312 U.S. 569 (1941) ....... 20

Follett v. Town of McCormick, 321 U.S. 573

CRUE us bu seb aes oes ees ee 10

Forsyth County, Georgia v. The Nationalist

Movement, 505 U.S. 123 (1992)

er er WETE Tre TeTe TTT eres. Ve Se

Glendora v. Levin, 24 Fed. Appx. 474,

2001 West Law 1587415 (6th Cir.2001) ..... 16

Horton v. City of Houston, Civ. Action

POO TEPER VOOM co sccescasetevenccsesios l

Horton v. City of Houston, No. 03-20450

Sa nox 624 he ies ee eee 1,7

Horton v. City of Houston, 179 F.3d 188

Ces 6h ce cy uenenae honk brace un 1,6

Hurley v. Irish-American Gay, Lesbian and

Bi-Sexual Group of Boston, 515

Se Ee SUE 65 oon eek eee eaes 19

Jones v. Opelika, 319 U.S. 103 (1943) ......00.0... 10

Vill

Missouri Knights of the Ku Klux Klan v.

City of Kansas City, 723 F. Supp.

ESOT COV EPO EMO) oc ces cccnvcccsvevecs 17

Murdock v. Pennsylvania, 319 U.S. 105

SEED. 65:65:04 sede deeseeee ce cece 10, 21

NAACP v. Button, 371 U.S. 415 (1963) 2.0.2.0... 14

New York Times Co. v. Sullivan, 376 U.S. 254

EPR. cons ocv cas cake eeee kee eran 10

Red Lion Broadcasting v. FCC, 395 U.S. 367

SO svc ndasacbeadaeeenan iran. cee 18

Regan v. Time, Inc., 468 U.S. 641 (1984) .......... 22

Reno v. ACLU, 521 U.S. 844 (1997) ........000.... 15

Smith v. Goguen, 415 U.S. 566 (1974) ............. 13

Turner Broadcasting System v. FCC,

Ed Ws GE EE kb heed chee dev enews 15

Warner v. American Cablevision of Kansas

City, Inc., 699 F.Supp. 851

CAA I ski hie i ae le a ee 16

WLNY-TYV, Inc. v. FCC, 163 F.3d 137

ele 8 | Or eer rE er re em may 19

Constitution

Amendment I, United States Constitution

cakanyes i, 6, 8, 10 11, 12, 13, 17, 18, 19, 21, 22, 23, 24

Amendment XIV, United States Constitution

Cee etal we bod cao dined ae ale we alu 1, 6, 20

Statutes

eS a ee 2

Me gr yuo ore sda a ax avns 2

ke 5 i ee i, 3, 6, 10, 17, 19, 21

id | Et ene ne 13,17

ee a gre Wa a G4 4 bk by ha Maca dea is 4

RGR a 4

re 13

Local Rules

2.A-5 Program Contract and

ee 5

Rules

Rule 29.1, Supreme Court Rules ................... 2

Other Authority

Congressional Findings and Policy, Pub. L.

102-385, Sec. 2(a), (b), Oct. 5, 1992,

106 Stat. 1460, 1463(b)(1) 2.2... 9

Federal Limits, 913.08, Telecommunications

Regulations: Cable, Broadcasting,

Satellite and the Internet, Vol.1, 13-73,

Charles D. Ferris, LexisNexis, Matthew

Bender, Newark NJ (2002) ................. 16

HR Rep. 98-934, 98th Cong. Sess. 46 (1984) ........ 9

Modern Communications Law, Vol. 1,

Harvey L. Zuckerman, Access to

Channels of Communication 1.8,

137 A(2)(a), at 149, West Publishing

Co., St. Paul, MN (1999) ......0........... 16

Public Access, The Free Access Channel

Requirements, §15.03[1],

Telecommunications Regulations:

Cable, Broadcasting, Satellite and the

Internet, Vol. 2, Charles D. Ferris,

LexisNexis, Matthew Bender,

Be re ee 15

The 1976 Revision to the Access Rules,

1976 Report and Order, 415.04,

Telecommunications Regulations:

Cable, Broadcasting, Satellite and the

Internet, Vol. 2, Charles D. Ferris,

LexisNexis, Matthew Bender, |

Newark NJ (2002) ........................ 15

The Void-For-Vagueness Doctrine in the

Supreme Court, 109 U.Pa.L.Rev. 67

a Bee Paar en gceeioe a ir Oe 14

U.S. Code Congressional & Administrative

News, 98th Cong., Vol. 5, p. 4668

SN ee ya eaten pars occ 17

U.S. Code Congressional & Administrative

News, 98th Cong., Vol. 5, pp. 4672-73

CSS ae irsot os ee ee 16, 18, 21

PETITION FOR A WRIT OF CERTIORARI

Petitioner, The Nationalist Movement, by and through

counsel, prays that a Writ of Certiorari issue to review the

judgment of the United States Court of Appeals for the

Fifth Circuit in this matter.

OPINIONS BELOW

The unpublished ruling of the United States Court of

Appeals for the Fifth Circuit from which certiorari is

sought is contained in Robert Horton, Nationalist Televi-

sion and Barry Hackney v. City of Houston and Access

Houston Cable Corporation, No. 03-20450, at Appendix

“A,” dated March 17, 2004, with Judgment dated April 8,

2004, at Appendix “B,” affiriaing judgment of the United

States District Court for the Southern District of Texas,

Houston Division, in Robert Horton, Nationalist Television

and Barry Hackney v. City of Houston and Access Houston

Cable Corporation, Civ. Action No. H-92-CV-3451, dated

March 31, 2003, at Appendix “C,” pursuant to remand of

the United States Court of Appeals for the Fifth Circuit in

Robert Horton, Nationalist Television and Barry Hackney

_v. City of Houston and Access Houston Cable Corporation,

179 F.3d 188 (Sth Cir.1999), at Appendix “D,” dated June

18, 1999, which reversed and remanded Robert Horton,

Nationalist Television and Barry Hackney v. City of Hous-

ton and Access Houston Cable Corporation, Civ. Action

No. H-92-CV-3451, at Appendix “E,” dated October 16,

1997.

STATEMENT OF JURISDICTION ©

The jurisdiction of this Court is invoked pursuant to 28

USC §1254(1) and 2106.

CORPORATE DISCLOSURE STATEMENT

Pursuant to Rule 29.1, Petitioner, Nationalist Televi-

sion, states that it isa Texas non-profit corporation, having

no parent corporation. It has no subsidiaries.

°,

“~

CONSTITUTIONAL PROVISIONS

Amendment I, United States Constitution:

Congress shall make no law respecting an establish-

ment of religion, or prohibiting the free exercise

thereof; or abridging the freedom of speech, or the

press; or the right of the people peaceably to as-

semble, and to petition the Government for a re-

dress of grievances.

Amendment XIV, United States Constitution:

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 immunities of citizens of the United States: nor

shall any State deprive any person of life, liberty, or

property, without due process of law; nor deny to

any person within its jurisdiction the equal protec-

tion of the laws.

STATUTES

47 USC §521, Cable Television Policy Act of 1984

PURPOSES

The purposes of this subchapter are to -

(1) establish a national policy concerning cable com-

munications;

(2) establish franchise procedures and standards which

encourage the growth and development of cable systems

and which assure that cable systems are responsive to the

needs and interests of the local community;

(3) establish guidelines for the exercise of Federal,

State, and local authority with respeci to the regulation of

cable systems;

} (4) assure that cable communications provide and 4re

encouraged to provide the widest possible diversity of in-

formation sources and services to the public;

47 USC §522, Cable Television Policy Act of 1984

DEFINITIONS

For purposes of this subchapter -

(15) the term “public, educational, or governmental

access facilities” means -

(A) channel capacity designated for public, educational,

or governmental use; and

(B) facilities and equipment for the use of such channel

Capacity;

47 USC §531, Cable Television Policy Act of 1984

CABLE CHANNELS FOR PUBLIC, EDi "CATION-

AL, OR GOVERNMENTAL USE -

(e) Editorial control by cable operator

Subject to section 544(d) of this title, a cable operator

shall not exercise any editorial control over any public, ed-

ucational, or governmental use of channel Capacity pro-

vided pursuant to this section.

LOCAL RULES OF PROCEDURE

ACCESS HOUSTON

2.A-5 PROGRAM CONTRACT AND RESPON-

SIBILITY: Before access programs are scheduled

for cable-cast, the access program provider must

sign a Program Contract which holds the program

provider liable for content of the program and pay

all applicable fees. In signing the Program Con-

tract, the program provider agrees in writing that

his or her program does not include any form of

“constitutionally unprotected speech.”

The said fees are set out on Page Three of the said Rules

& Procedures, styled:

The Public Access Channel Fees:

Program Distribution

Programs Produced Locally

Individuals & Organizations FREE

Programs Produced Elsewhere

Individuals $75 / hr

Organizations $100 / hr

“~

STATEMENT OF THE CASE

Petitioners Barry Hackney and Robert Horton, as resi-

dents of Houston, Texas, desired to broadcast documentary

and news programs over the Houston public-access cable-

television channel. Petitioner, Nationalist Television, do-

miciled in Houston, is a non-profit charitable and educa-

tional corporation, which produces the programs, entitled

Airlink, in Mississippi.

The content of Airlink, which is not obscene, has been

described by Petitioners as “pro-majority,” by Respondents

as “white supremacist,” App. 37, and by others as “contro-

versial.” Content comes from many diverse sources, out-

side of Houston city-limits. Respondents imposed a

$100.00 per-hour fee to broadcast “non-locally produced”

programs, App. 59. Horton, who refused to pay the fee,

and Hackney, who was unable to afford the fee, commenc-

ing litigation to redress violations of the First and Four-

teenth Amendments and the Cable Act.

The trial court granted summary judgment in favor of

Respondents on the grounds that there was no evidence

that Respondents had acted arbitrarily. On appeal, the de-

cision was reversed and remanded on the grounds that the

regulation was content-neutral, but that Respondents had

failed to show that the regulation was narrowly tailored to

avoid abridging the First Amendment. The appeals’ court

in Horton I concluded that insofar as the First Amendment

was impacted, the trial court should not simply “rubber-

stamp” the regulation, but agonized that “[m]Juch is uncer-

tain about the scope of First Amendment benefits and bur-

dens in the cable industry,” App. 54.

The holding was that public-access was a public forum,

subject to “intermediate” scrutiny, rather than akin to a

traditional public forum, subject to “strict” or “height-

ened” scrutiny. Under the “intermediate” scrutiny test, on

remand, the trial court held that the fee conferred some

benefit and, therefore, was narrowly-tailored and promoted

“localism,” rather than having to conclude that a “compel-

ling state interest” was required to be served, had the stan-

dard akin to the traditional public forum been required. On

appeal in Horton II, the appeals’ court affirmed that the fee

was “narrowly-tailored” to promote “localism.”

Public-access is funded by the municipality, initially at

some $500,000.00 per year, which now has reached some

$900,000.00 per year, App. 21. There is no scarcity of

airtime, App. 21, 25, and programs are repeated four or

more times. Airlink comes “pre-packaged,” requiring no

additional facilities or overhead to broadcast. There are no

standards or guidelines for the charging of fees or the dif-

ferentiation of amounts of fees between “individuais” and

“organizations.”

Initially, Airlink had sought to broadcast its weekly

show beginning during the Republican National Conven-

tion, held in Houston in 1992. News accounts labeled it

“white-supremacist.” The program was banned, ostensibly

for non-payment of “non-locally-produced” fees. But,

after the first court-hearing, the ban was lifted and the pro-

gram was broadcast for several weeks, App. 15-16, into

1993, until a program was tendered criticizing homosexu-

ality in the Army, at which time the show was booted,

again.

The Executive Director had testified, initially, that the

fees for non-locally-produced programming were not

needed and should be abolished, App. 50. In 1998, the

fees were osiensibly abolished; however, other fees were

imposed in their place, App. 8.

The case is timely brought here to address the matter of

first-impression of whether public-access is akin to a tradi-

tional public forum, subject to heightened scrutiny under

the First Amendment, and whether “localism” could be

effected in a less intrusive manner than by the imposition

of standardless and arbitrary fees.

REASONS FOR GRANTING THE PETITION

Cable-television is a new medium, only some two-de-

cades old. Public-access, which allows ordinary, local

citizens to produce shows and air their views, has been a

valuable and far-reaching part of the medium. Congress

has anticipated the growth of the medium! and attempted

to assure that the availability to the public of a diversity of

views and information through cable television be pro-

moted,’ with public-access available on a first-come-first-

served basis. However, at this critical juncture in the de-

velopment of public-access, the City of Houston and its

public-access operator have imposed fees, which have ex-

cluded some local residents from broadcasting. The pretext

has been to “raise revenue,” App. 18, 32, from local resi-

dents whose programs are “produced” outside the city, but

the effect has been to preclude “controversial” program-

ming. And, should the fee-scheme proliferate, public-ac-

cess will no longer be meaningfully “public” nor afford

genuine “access,” except to those who may be able to af-

ford to pay.

Public-access has already been regarded as a public

forum, but the Fifth Circuit seemed perplexed that defini-

' “Greater demand” anticipated, HR Rep. 98-934, 98th

Cong. Sess. 46 (1984) (urging franchising authorities to

combine access channels until great demand develops).

? Congressional Findings and Policy, Pub. L. 102-385,

Sec. 2(a), (b), Oct. 5, 1992, 106 Stat. 1460, 1463(b)(1).

tive guidance from this Court was lacking as to the full

extent of the forum. Petitioners seek to construe public-

access as akin to the Internet and a public-access broad-

caster as the same “town-crier” as the Internet-publisher,

to the end that speech may not be abridged, except for a

compelling governmental interest. A retrenchment, now,

would not only abrogate the letter and spirit set out by

Congress in the Cable Act, but adversely impact strong

national policy, under the First Amendment, that discus-

sion of public-issues in the public forum be wide open and

robust °.

Granting the Writ will also give the Court an opportu-

nity to review and, hopefully, reverse the establishment of

a fee-mechanism which caters to the wealthy in a public

forum, in a manner which the Court has, time and again,

denounced. Striking down fees, whether grounded upon

the rationale of a “tax upon knowledge,” as in Murdock v.

Pennsylvania,’ 319 U.S. 105 (1943), which prohibits a fee

for exercise of a constitutional right, or “arbitrary con-

duct,” as in Forsyth County, Georgia v. The Nationalist

* There is a “profound national commitment” to the

principle that “debate on public issues should be uninhib-

ited, robust and wide-open.” New York Times Co. v. Sul-

livan, 376 U.S. 254, 270 (1964).

* See also Jones v. Opelika, 319 U.S. 103 ( 1943) (no

license fee or tax upon exercise of the First Amendment);

Follett v. Town of McCormick, 321 U.S. 573 (1944) (strik-

ing down $1.00 license fee).

Movement, 505 U.S. 123 (1992), which prohibits a fee as

a potential for censorship by an administrator, guidance

from the Court will surely be a powerful boost to public-

access. Although some have suggested that this case is

about “localism,” which is in no wise under assault, it is

more about the dissemination of ideas and the protection of

free-speech.

PRG. OSITION I

THE RULE FOR THE CHARGING OF SELEC-

TIVE, ARBITRARY AND STANDARDLESS

FEES FOR THE BROADCASTING OF NON-LO-

CALLY PRODUCED PROGRAMS OVER PUB-

LIC-ACCESS CABLE-TELEVISION, WHICH

CONSTRICTS DIVERSITY OF INFORMATION

SOURCES AND SERVICES, NECESSARILY

CONSIDERING CONTENT, VIOLATES THE

FIRST AMENDMENT ANDISINVALIDONITS

FACE OR AS APPLIED.

It would appear that but one standard, when the First

Amendment impacts, might justify the limiting of public-

access programming and diverse-views propagation. That

would be a scarcity of facilities or airtime. Cf City of Los

Angeles v. Preferred Communications, 476 U.S. 488, 492,

495 (1986) (physical scarcity of available space and lack

of frequencies determinative). However, in the case at bar,

there is no scarcity of airtime, App. 7, and no lack of facili-

ties to broadcast. Airlink tapes are provided ready to be

broadcast and there is no additional overhead involved,

App. 24-25. If airtime were filled up with “locally-pro-

duced” programs and “non-locally-produced” shows

threatened to overwhelm them,’ some rationing mechanism

might be in order. But, there is no such scarcity.

It has been postulated that raising funds for the con-

ducting of a “survey” or purchasing a piece of extra equip-

ment “promotes” “localism,” even though programs ten-

dered by local residents unable to pay are kicked off the

air. It has been said that such funds are “beneficial,” App.

_ 26-27. A similar contention was turned down in Forsyth

County, 505 U.S. at 136, however, where it was argued

that a fee had to be charged to offset police-costs in polic-

ing a public assembly. While the Court noted that “raising

revenue” was an “important government responsibility,”

the charging of fees in derogation of the First Amendment

could not be justified.

Although it has been argued that the “content” of the

program is not considered, the potential® for abuse intrudes

> As in Chicago Cable Communications v. Chicago

Cable Com'n, 879 F.2d 1540 (7th Cir. 1989), cert. den. 493

U.S. 1044 (1990).

® See Forsyth County, 505 U.S. at 132. Arbitrary ap-

plication of a government regulation is

inherently inconsistent with a valid time, place and

manner regulation because such discretion has the

potential for becoming a means of suppressing a

particular point of view [emphasis added].

where the fee is charged, waived, withdrawn or reimposed,

without guidelines’ or without any reason being given.

And, the Executive Director, alone, App. 16, 51-54,

weighs the facts to make such determination, see e.g. Boos

v. Barry, 485 U.S. 312, 318-391 (1988) (content necessar-

ily had to be considered to determine legality),® as he

deems necessary to determine whether a broadcaster is an

See also, City of Lakewood v. Plain Dealer Publ’g, 486

U.S. 750, 763 (1988) (“[The] danger [of a First Amend-

ment violation] is at its zenith when the determination of

who may speak and who may not is left to the unbridled

discretion of a government. Cf Smith v. Goguen, 415 U.S.

566 (1974) (for the potentiality for abuse when a measure

has the potential to be administered in an arbitrary man-

ner).

? See Broadrick v. Oklahoma, 413 U.S. 601 (1973)

(“reasonable” time, place and manner restrictions may not

delegate standardless discretionary power to local function-

aries).

8 See also 47 USC §532(c)(2):

A cable operator shall not exercise any editorial

control over any video programming provided pur-

suant to this section, or in any other way consider

the content of such programming....

47 USC §521(4) expresses the will of Congress that

“the widest possible diversity of information sources and

services to the public” be assured on public-access.

“individual,” subject to one fee, or an “organization,” sub-

ject to another fee, or if he grants a waiver’ of fees, at all.

Forsyth County, 505 U.S. at 133, n. 10:

The District Court’s finding that, in this instance,

the Forsyth County administrator applied legiti-

mate, content-neutral criteria, even if correct, is ir-

relevant to this facial challenge. Facial attacks on

the discretion granted a decisionmaker are not de-

pendent on the facts surrounding any particular per-

mit decision.

If the case at bar dealt with, say, a locality charging a

local hunter one fee and out-of-state hunters a higher fee,

on the grounds that it would reduce an influx of hunters

and help in conserving wildlife, who could quarrel? And,

perhaps, under “intermediate” scrutiny, a similar finding

might obtain. But, where a rule has a substantial risk!? of

” The on-again-off-again treatment, sometimes waiving

the rule, sometimes attempting to enforce it, is plainly un-

constitutionally arbitrary. Cf NAACP v. Button, 371 U.S.

415, 438 (1963) (“precision of regulation” required for

constitutionally protected activity).

'° “Respondent mounts a facial challenge to the... ordi-

nance. It is well established that in the area of freedom of

expression an overbroad regulation may be subject to facial

review and invalidation,” Forsyth County, 505 U.S. at 129.

See also, The Void-For-Vagueness Doctrine in the Su-

preme Court, 109 U.Pa.L.Rev. 67 (1960).

eliminating certain ideas or viewpoints from the public

dialogue based upon content, there must be strict scrutiny,

Turner Broadcasting System v. FCC, 512 U.S. 622, 642

(1994).

The Court has already found the Internet to be akin to

the traditional public forum, Reno v. ACLU, 521 US. 844

(1997) (extrapolating from the proverbial soapbo’ ), postu-

lating that anyone with a phone line now had the capability

to become a “town crier.” It is not a far stretch to conclude

that anyone with a video camera could do likewise.

In fact, but for the “maverick” ruling, below, it had

generally been assumed that public-access was akin to the

traditional public forum and, indeed, “Free TV,” instead of

“Fee TV.”

Cable systems were not permitted to charge

for the use of airtime on the public access

channel.

Public Access, The Free Access Channel Requirements,

415.03[1], Telecommunications Regulations: Cable,

Broadcasting, Satellite and the Internet, Vol. 2, Charles D.

Ferris, LexisNexis, Matthew Bender, Newark NJ (2002)

(stressing the “public-interest” obligation). At every step

of the way in the development of public-access, the FCC

mandated “diverse channel users” be provided for and en-

couraged, finding “definite societal good” therefrom. Zhe

_ _1976 Revision to the Access Rules, 1976 Report and Order,

915.04, Telecommunications Regulations: Cable, Broad-

casting, Satellite and the Internet, Vol. 2, Charles D. Fer-

ris, LexisNexis, Matthew Bender, Newark NJ (2002).

_ Such public policy was reiterated in 1984 that “public

access channel [is to be] available on a first come, nondis-

criminatory basis.” U.S. Code Congressional & Adminis-

trative News, 98th Cong., Vol. 5 (1984), p. 4673.

The only requirement, until now, has been that a local

sponsor was required, Glendora v. Levin, 24 Fed.Appx.

474, 2001 West Law 1587415 (6th Cir.2001). Ifa munici-

pality did not wish to carry out its obligations, it could ter-

minate public-access altogether, cf. Warner v. American

Cablevision of Kansas City, Inc., 699 F.Supp. 851 (D.-

Kan.1988). Scholars, in discussing the “elusive” concept

of the public forum in telecommunications, have suggested

that Forsyth County applies to prevent an Administrator

from being vested with sole and arbitrary authority to

charge a fee for public-access, Modern Communications

Law, Vol. 1, Harvey L. Zuckerman, Access to Channels of

Communication 1.8, 137 A(2)(a), at 149, West Publishing

Co., St. Paul, MN (1999).

Former FCC-Chairman Charles D. Ferris has called the

medium a “speaker’s corner” in a “classic public forum”:

Because public access channels set up a

form of video “Speaker’s Corner,” they pre-

sent a classic public forum, thereby limiting

regulation to content-neutral, narrow-tai-

lored, time, place and manner restrictions.

Federal Limits, 913.08, Telecommunications Regulations:

Cable, Broadcasting, Satellite and the Internet, Vol.1, 13-

73, Charles D. Ferris, LexisNexis, Matthew Bender, New-

ark NJ (2002). Accord, Missouri Knights of the Ku Klux

Klan v. City of Kansas City, 723 F. Supp. 1347 (W.D.Mo.-

1989) (finding “public forum”).

Public-access is, as the name implies, “public,” under

the Cable Television Policy Act of 1984, 47 USC §521 et

seq. involving state-action. The intent of the Act, by its

terms, is to assure and encourage the widest possible di-

versity'' in cable communications, 47 USC §521(4). While

'! See the legislative history of the Cable Act, which

created public access. U.S. Code Congressional & Admin-

istrative News, 98th Cong., Vol. 5 (1984), p. 4668.

[A]ccess provisions contained in this legislation are

consistent with and further the goals of the First

Amendment.... which will foster the availability of

a “diversity of viewpoints” to the listening audi-

ence....

The goal of the First Amendment is to foster “the

widest possible dissemination of information from

diverse and antagonistic sources.” Associated Press

v. United States, 326 U.S. 1, 20 (1945).

The interest in diverse sources of information is

akin to, if indeed it is not the same as, the inter-

est protected by the First Amendment...

examining the critical facts, de novo,'* the Court is urged

to bear in mind the goal that “optimum use is made of the

cable medium in the public interest,” Community Commu-

nications Corp. v. City of Boulder, 660 F.2d 1370, 1379

(10th Cir.1981).

This interest has been recognized time and time

again. In Red Lion Broadcasting v. FCC, 395 US.

367, 390 (1969), for instance, the Supreme Court

observed that

[i]t is the purpose of the First Amendment to

preserve an uninhibited marketplace of ideas in

which truth will ultimately prevail, rather than

_ to countenance monopolization of that market.

As we enter the “information age,” access to tele-

communications networks has become increasingly

important to full participation in the political, eco-

nomic, social, and cultural life of the nation. The

First Amendment’s guarantee of a free flow of di-

verse ideas will be reduced to an empty promise if

access to information is not available to all our citi-

zens.

U.S. Code Congressional & Administrative News, 98th

Cong., Vol. 5 (1984), p. 4673.

'2 See Bose v. Consumers Union of United States, Inc.,

466 U.S. 485, 499 (1984) (independent examination of the

record as a whole required)

“Localism” is of value, WLNY-TV, Inc. v. FCC, 163

F.3d 137 (2d Cir.1998). But in the context of this case, the

nexus even of localism must be, Does the fee hinder the

communication of ideas? In other words, look to sub-

stance over form. Would not the public-interest be well-

served if Mr. Hackney, for example, presented a tape he

had filmed of the Presidential Inauguration, just as much

as if Mr. Horton presented a tape of the Mayoral Inaugura-

tion?

As the Court noted in Hurley v. Irish-American Gay,

Lesbian and Bisexual Group of Boston, 515 U.S. 557

(1995), a newspaper may print an edited compilation of

speech generated by other persons in its opinion pages. If

the speaker or writer were in another locale, would the

ideas be less-worthy or the First-Amendment less-encom-

passing? The same rationale would seem to apply to the

airing of a videotape, if the subject-matter may be outside

the city-limits'’ or the editing-machine in another state, so

long as, of course, under the Cable Act, the sponsor is a

local resident and no other local producers are disadvan-

taged or “local subjects” shunted aside, as a result.

'3 The rules require that 51% of video be shot within

the city-limits, App. 59. The administrator would, neces-

sarily, be compelled to consider the content of the message

sought to be conveyed to determine if the program were,

therefore, “local,” with no fees, or “non-local,” for fees.

But see, Arkansas Writers’ Project, Inc. v. Ragland, 481

U.S. 221, 230 (1987) (prohibition against consideration of

content of message).

PROPOSITION II

THE RULE FOR THE CHARGING OF FEES

FOR THE BROADCASTING OF NON-LOCAL-

LY PRODUCED PROGRAMS OVER PUB-

LIC-ACCESS CABLE-TELEVISION, WHICH

CREATES A CATEGORY FOR THOSE WHO

CAN PAY TO BROADCAST VERSUS THOSE

WHO CANNOT AFFORD TO PAY AND,

THEREFORE, CANNOT BROADCAST, VIO-

LATES THE EQUAL PROTECTION CLAUSE

OF THE FOURTEENTH AMENDMENT.

A special status for would-be speakers based upon abil-

ity to pay has been impermissibly created. If “localism,”

that is to say the ability of local citizens to broadcast and

focus on purely local topics, were adversely impacted,

which it is not in this case, a less intrusive method’ could

be devised to remedy the problem, without a fee. But man-

dating that a local resident may not broadcast at all, if his

video contains ideas in a setting, outside the city, App. 13,

59, unless he pays, not only excludes ideas from a very

marketplace of ideas but shunts aside those who cannot

afford to pay. Cf Columbia Broadcasting System, Inc. v.

Democratic National Committee, 412 U.S. 94, 123 (1973)

(domination of the public agenda by the wealthy con-

'* The proper exercise of governmental authority is

simply to assure the first-come, first-served priority of dif-

fering events ... seeking ... the same time, cf. Cox v. New

Hampshire, 312 U.S. 569, 574-576 (1941).

demned). See also the legislative history of the Cable Act,

U.S. Code Congressional & Administrative News, 98th

Cong., Vol. 5 (1984), pp. 4672-73, where Congressional

intent is summed up as:

Public access channels available under H.R. 4103

would be available to all, poor and wealthy alike,

thereby minimizing the Court’s fear in Democratic

National Committee of domination of the media by

the wealthy.

This Court has already approved the concept of first-

come, first-served:

Congress ... may devise ... access that ... will afford

increased opportunities for the discussion of public

issues ... on a first come, nondiscriminatory basis.

Columbia Broadcasting System, Inc. v. Democratic Na-

tional Committee, 412 U.S. 94, 131 (1973), cited in U.S.

Code Congressional & Administrative News, 98th Cong.,

Vol. 5 (1984), p. 4673. The Cable Act was said to have

secured the First Amendment right of the viewers

and listeners to a diversity of information sources,

id.

The instant fee amounts to a tax on speech, rather than

a promoter of “localism” and, as such, is intolerable. See,

e.g. Murdock, 319 U.S. at 133 (1943) (any charge for exer-

cise of First Amendment rights is unconstitutional).

[T]he concept that government may restrict the

speech of some elements of our society in order to

enhance the relative voice of others is wholly for-

eign to the First Amendment.

Buckley v. Valeo, 424 U.S. 1, 48-49 (1976).'° One is given

to wonder if Petitioners had submitted a video of the Super

Bowl, filmed in Florida, instead of a “controversial” mes-

sage filmed in Mississippi, the fee-requirement would have

been enforced against them?'°

'° A proposition with which this brief-writer, person-

ally and parenthetically, disagrees.

'© See Regan v. Time, Inc., 468 U.S. 641, 648-649 (19-

84) (regulations permitting government dis ‘rimination on

the basis of content of message cannot be tolerated under

the First Amendment).

CONCLUSION

The Court has been diligent in assuring that the First

Amendment does not lag behind technology in the Infor-

mation Age. Cable-television and the Internet are the two

major breakthroughs in modern communications which

uniquely empower ordinary individuals to express ideas,

not unlike the printing-press in earlier days. But for the

impediment of overbroad, vague and chilling rule, which

allows for the imposition of fees, public-access offers great

promise. However, the fee-rule flies in the face of public-

policy,’ the will of Congress, clear precedent of this Court

and constitutional guarantees, beckoning others to perhaps

apply the same brakes which have driven certain “contro-

versial” ideas off the air.

This is an important free-speech case, in which the

lower courts have departed significantly from the content-

neutrality doctrine clearly laid down by this Court, but in

a manner and medium not yet full-addressed here. This

case has broad implications for First Amendment rights,

for if state actors are permitted to constrict this Court’s

clear mandate that a regulation’s potential for abuse of the

First Amendment will be considered in any facial chal-

'7 Compare, Connick v. Myers, 461 U.S. 138 (1983)

(public-issue speech ranked as highest-rung of First-

Amendment values) with Forsyth County, 505 U.S. at 136

(progression of constitutional law relied upon “[iJn light of

the Court’s subsequent First Amendment jurisprudence”).

lenge, there will be virtually no end to the schemes, diver-

sions and ruses to thwart Congress’ clear intent that public-

access broadcasting be wide-open and robust, on a first-

come, first-served basis.

If unbridled discretion is permitted to creep back into

the marketplace of ideas, so that those regulating public-

access programming may consider — actually or necessarily

~ the content of speech, the profound national commitment

to wide open and robust discussion of public affairs will

take a galling step backward. If a charge is allowed to be

placed upon those seeking to exercise free speech over the

public-access channels, with no compelling governmental

reason for such a fee, the First Amendment will become

more of a privilege than a right, and evermore ineffective,

especially for the poor. The Court has not, as yet, denomi-

nated public-access as a public-forum akin to the tradi-

tional public-forum. But that time has come.

For the foregoing reasons, the Petition for Writ of Cer-

tiorari should be granted.

RICHARD BARRETT

Counsel of Record

Richard Barrett

PO Box 2050

Learned MS 39154

(601) 885-2288

Attorney for Petitioners

Appendix 1

APPENDIX A

UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 98-2003 1

ROBERT HORTON, NATIONALIST

TELEVISION, a Texas Non-Profit —

and BARRY HACKNEY,

Plaintiffs-Appellants,

versus

CITY OF HOUSTON, TEXAS and

ACCESS HOUSTON CABLE CORPORATION,

Defendants-Appellees.

Appeal from the United States District Court

for the Southern District of Texas

H-92-CV-3451

March 17, 2004

Before REAVLEY, DAVIS and DeMOSS, Circuit Judges.

Appendix 2

PER CURIAM:!

After reviewing the record created on remand and con-

sidering the briefs of the parties and argument of counsel,

we are satisfied that the district court properly carried out

our remand instructions. We also conclude that the district

court did not err in concluding that the fee in question was

narrowly tailored to achieve the legitimate objective of

promoting localism. We therefore affirm the judgment of

the district court.

AFFIRMED.

' Pursuant to STH CIR. R. 47.5, the Court has deter-

mined that this opinion should not be published and is not

precedent except under the limited circumstances set forth

in STH CIR. R. 47.5.4.

‘ppeittira D

APPENDIX B

UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 03-20450

D.C. Docket No. H-92-CV-3451

ROBERT HORTON; NATIONALIST

TELEVISION, a Texas Non-Profit

Corpora t ion, BARRY HACKNEY

Plaintitfs -Appellants

CITY OF HOUSTON, TEXAS;

ACCESS HOUSTON CABLE

CORPORATION

Defendants -Appellees

Appeal from the United States District Court for the

Southern District of Texas, Houston.

Before REAVLEY, DAVIS and DeMOSS, Circuit Judges.

JUDGMENT

This cause was considered on the record on appeal and

was argued by counsel.

Appendix 4

It is ordered and adjudged that the judgment of the Dis-

trict Court is affirmed.

IT IS FURTHER ORDERED that plaintiffs-appellants

pay to defendants-appellees the costs on appeal to be taxed

by the Clerk of this Court.

ISSUED AS MANDATE: April 8, 2004

Appendix 5

APPENDIX C

IN THE UNITED STATES DISTRICT COURT

FOR THE SOUTHERN DISTRICT OF TEXAS

HOUSTON DIVISION

ROBERT HORTON, BARRY HACKNEY,

and NATIONALIST TELEVISION,

a subsidiary of THE NATIONALIST

MOVEMENT, a Texas

Nonprofit Corporation,

Plaintiffs,

CITY OF HOUSTON, TEXAS,

a Texas municipal corporation,

and ACCESS HOUSTON

CABLE CORPORATION, a

Texas corporation,

Defendants.

CIVIL ACTION NO. H-92-3451

FINDINGS OF FACT & CONCLUSIONS OF LAW

Pending before the Court are Plainti‘fs’ (collectively

“N-TV”) claims against the defendant Access Houston

Cable Corporation (“Access Houston”). The claims were

Appendix 6

tried to this Court on August 31, 2001, and the Court

makes findings of fact and conclusions of law as set out

below.' After considering the testimony and exhibits in

evidence, the parties’ arguments, and the applicable law,

the Court finds that judgment should be granted in favor of

Access Houston. |

Procedural Background

This case is currently on remand from the United States

Court of Appeals for the Fifth Circuit. See Horton v. City

of Houston, 179 F .3d 188 (Sth Cir. 1999). The Fifth Cir-

cuit reversed the order granting summary judgment in fa-

vor of Access on Plaintiffs’ challenge to the constitutional-

ity of Access’s higher fee requiren ents for programming

that is not “locally produced” in and around Houston,

Texas. /d. at 189. The Fifth Circuit agreed that the regula-

tion at issue was content-neutral and that Access had iden-

tified substantial government interests that the regulation

could advance. /d. at 193-96. However, it held that Access

had failed to provide evidence that demonstrated, as a mat-

ter of law, that the regulation was narrowly tailored to ad-

vance its articulated substantial interests. /d. at 195-96. In

particular, the court stated that:

[Access] has not shown that, absent the fee

charged to providers of non-local programs, its

To the extent that any conclusion of law is more

properly characterized as a finding of fact, and vice versa,

the Court adopts it as such.

Appendix 7

interest in promoting localism “would be achieved

less effectively.” [United States v. Albertini, 472

U.S. 675, 689 (1985).] Access has not provided

any evidence linking the amount charged to

non-local producers and the promotion of local-

ism. More precisely, Access has not shown the

amount of revenue generated from the fee, the

number of providers who have been charged the

fee, or whether the fees have actually helped pur-

chase equipment, train producers, enhance com-

munity self-expression, or offset amounts under-

written’ by Houston cable subscribers. Access ac-

knowledged there is no scarcity of time available

for programs, so the fee plays no role in rationing

airtime favorably to locally produced programs.

Id. at 195. Consequentiy, the Fifth Circuit remanded to

this Court for further factual development, stating that:

On remand, Access should prove how much reve-

nue accrues trom the fee for non-locally-produced

programs, as well as the purposes for which it uses

the revenue. If the revenue is minimal-that is, if it

fails to ration scarce airtime, to reimburse Ac-

cess’s costs of airing non-locally-produced pro-

grams, or to make any realistic dent in the costs

borne bv cable subscribers for the production fa-

cilities-then the district court may conclude that

the fee suppresses protected speech without pro-

viding any asserted benefits.

Id. at 196.

Appendix 8

On remand, Access and Plaintiffs conducted additional

discovery and submitted motions for summary judgment.

In the order addressing the motions, the Court noted that

“the only remaining issue in this case ... is whether the in-

creased payments that Access charged non-locally-pro-

duced programs are a narrowly tailored means to advance

the substantial government interests that Access has articu-

lated.” Memorandum & Order, Dkt. # 107, at 5 (citing

Horton, 179 F .3d at 195-96). As neither Plaintiffs nor Ac-

cess had submitted evidence sufficient to demonstrate an

entitlement to summary judgment, the Court denied both

motions. /d. at 10. The Court then held a bench trial on

August 31, 2001, where the parties were permitted to pres-

ent evidence and argue their positions before the Court.

The Court also permitted the parties to submit post-trial

memoranda regarding the legal issues in the case.

Mootness

Before addressing the merits of this action, the Court

will examine Access’s contentions that this action is now

moot and therefore not justiciable. Access testified that it

no longer charges the ... fees in question and Plaintiffs

have not disputed this claim.” Access contends that Plain-

tiffs’ challenge is to the constitutionality of the fees

* During the bench trial, Plaintiffs did imply that Ac-

cess now charges different fees which may be unlawful,

but there is no evidence before the Court to indicate that

the new fees are merely a substitution for the old, chal-

lenged fees.

Appendix 9

charged in the early 1990’s as those fees were applied to

Plaintiffs. Since Access no longer charges those fees, there

is no longer any danger of Plaintiffs suffering any constitu-

tional deprivations and consequently no need for the Court

to protect the .Plaintiffs from anything. Therefore, Access

argues that Plaintiffs’ claims for declaratory and injunctive

relief are moot.’

A case becomes moot upon the cessation of the unlaw-

ful conduct if(1) there is no reasonable expectation that the

alleged violation wili recur and (2) interim relief or events

have completely and irrevocably eradicated the effects of

the alleged violation. Texas Office of Pub. Util. Counsel v.

FCC, 183 F.3d 393, 413-14 (Sth Cir. 1999). However, it is

well settled that a defendant’s voluntary cessation of a

3 If Plaintiffs were seeking monetary damages for the

past alleged deprivation, then cessation of the allegedly

unlawful activity wou!d not render the case moot. See Har-

ris v. City of Houston, 151 F.3d 186, 191 fn. 5 (Sth Cir.

1999) (stating that a claim for monetary relief in addition

to the claims for injunctive and declaratory relief would

have prevented the case from becoming moot). Plaintiffs

did mention compensatory and punitive damages in their

original complaint, but have not pursued these remedies.

Rather, Plaintiffs’ counsel only mentioned injunctive and

declaratory relief at the bench trial and in post-trial briefing

which supports a finding that Plaintiffs have waived any

monetary claims against Access that had been listed in

their complaint.

Appendix 10

challenged practice does not render a case moot and de-

prive a federal court of its power to determine the legality

of the practice unless it is “absolutely clear that the alleg-

edly wrongful behavior could not reasonably be expected

to recur.” Buckhannon Bd. & Care Home, Inc. v. W. Va.

Dep't of Health & Human Resources, 532 U.S. 598,609

(2001) (citing Friends of the Earth, Inc. v. Laidlaw Envi.

Servs. (TOC), 528 U.S. 167, 189 (2000)). The Supreme

Court has described this standard as “stringent,” see FOE,

528 U.S. at 189, and has held that a finding of mootness is

justified “only if it [is] absolutely clear that the litigant no

longer [has] any need of the judicial protection that it

[seeks], Adarand Constructors, Inc. v. Slater, 528 U.S.

216, 224 (2000). The “heavy burden” of persuading the

court that the challenged conduct cannot reasonably be

expected to start up again lies with the party asserting

mootness. See FOE, 528 U.S. at 189; accord Adarand

Constructors, Inc., 528 U.S. at 222.

Despite the heaviness of a defendant’s burden, the test

is not whether the action originally giving rise to the con-

troversy could not conceivably reoccur, but whether it is

absolutely clear that the behavior could not reasonably be

expected to recur. See City of Erie v. Pap’s A.M.,529 US.

m, 303 (2000) (Scalia, J., concurring). Access could con-

ceivably reinstate the allegedly unlawful fees. However,

the inquiry is whether it is absolutely clear that Access

could not reasonably be expected to reinstate the fees.

Access presented witnesses at the bench trial who testi-

fied both that Access no longer charges the fees in question

and that Access has no intention to ever charge such fees

Appendix 11

again. Access also affirmatively states in its post-trial

briefing that it has no intention to ever charge such fees

again which it claims judicially estops it from ever at-

tempting to reinstate the fees in question. Furthermore,

Patricia Garlinghouse testified at trial that she suggested

eliminating the nonlocal fees when she became executive

director in 1997.* At the time of the suggested change, it

does not appear that Ms. Garlinghouse was aware of the

current litigation regarding the fees which had been in

progress for approximately 5 years. Thus, the evidence

before the Court indicates that Access did not alter its con-

duct in response to the litigation or as part of any litigation

strategy, which is one concern that has been expressed by

the Supreme Court when determining whether voluntary

cessation of an activity renders a case moot. See City of

Erie, 529 U.S. at 288 (“Our interest in preventing litigants

from attempting to manipulate the Court’s jurisdiction to

insulate a favorable decision from review further counsels —

against a finding of mootness here.”’). Finally, Plaintiffs

have not provided any evidence which contradicts Ac-

cess’s claim that it will never reinstate the fees in question.

However, it is Access that “bears the formidable burden of

showing that it is absolutely clear the allegedly wrongful

behavior could not reasonably be expected to recur.” FOE,

528 U.S. at 190.

* The fees were not actually eliminated until some time

in 1998. Defendant’s Exhibit 28 submitted at the bench

trial shows receipts for non-local broadcast fees that were

collected as late as March 11, 1998.

Appendix 12

While it is a close call, the Court does not believe that

Access has met its heavy burden in this case. Unlike the

cases where an outside force is acting to prevent reoccur-

rence of the challenged activity, see, e.g., AT&T Communs.

v. City of Austin, 235 F.3d 241, 243 (5th Cir. 2000) (find-

ing case moot where intervening state law prohibited chal-

lenged municipal conduct), the only obstacles to reinstate-

ment of the challenged fees are Access’s stated belief that:

it is judicially estopped from such reinstatement and Ac-

cess’s likely fear of repeated litigation. If Access chose to

challenge its own judicial estoppel arguments and risk fur-

ther litigation, its board could reinstate the fees at anytime.

It may be unlikely that Access will ever reinstate the

non-local fees, but that is not quite the same as finding that

it would be unreasonable to expect that Access would rein-

state them at some point. The evidence before the Court is

not sufficient to show that it is absolutely clear that Access

could not reasonably be expected to reinstate the fees at

some point in the future. Therefore, Access’s voluntary

cessation of the allegedly unlawful activity is not enough

to render this case moot.

Findings of Fact*

1. Access Houston is a non-profit Texas corporation

with 501(c)(3) status.

2. In one of its initial information booklets, Access

Stated that “the purpose of [Access Houston’s] public ac-

> The Court’s findings of fact are based on evidence

and testimony presented at the August 31, 2001 bench trial.

Appendix 13

cess television channel is to ensure that all residents of

Houston can use access resources and facilities on an equi-

table basis. We are here to maintain and protect your first

amendment rights for the freedom of speech and to assist

the citizens of Houston in the production and distribution

of access programming in a timely manner.”

3. Access Houston began operating in 1987.

4. Access began charging user fees in 1988. One of

these fees was a distribution fee. As used in the fee sched-

ule, distribution refers to “the distribution of non-com-

mercial public access programs.” Distributing a program is

commonly known as “airing” a program.

5. In addition to distribution fees, Access also charged

all producers’ fees to use Access’s equipment and facilities

during this sare time period. For example, Access charged

$150 for someone to attend a teleproduction workshop,

$100/day to rent a camcorder kit, and $125/hour to rent an

online edit suite.

6. The program distribution fee charged in 1988 was

$75 for non-locally produced programs submitted by indi-

viduals and $100 for non-locally produced programs sub-

mitted by organizations. There was no charge for distribu-

® While technically Access charged both local and non-

local producers the same fees for renting equipment and

studio space, if a producer had used the production equip-

ment and facilities that were located in Houston for at least

50% of their work, it would make the production a locally

produced program regardless of where the actual producer

resided. Thus, by nature of using the equipment, almost

every user becomes a local producer.

Appendix 14

tion of locally-produced programs.

7. The program distribution fee amounts remained the

same from 1988 until at least 1993. 8. Access charged dis-

tribution fees for non-locally produced programs from

1988 until at least March 11, 1998.

9. Access no longer charges anyone a fee for distribut-

ing a program, even if it is produced outside of Houston.

10. In 1989, Access distributed approximately 42.5

hours of non-locally produced public access programming.

11. In 1989, under Access’s fee-schedule, the 42.5

hours of non-local programming would have generated

between $3,187.50 and $4,250.00 in revenue depending on

how many programs qualified for either the individual or

organizational rate ($75/hr for individuals, $100/hr for

organizations).’

” The Court can not tell from the documents submitted

as evidence in this matter which non-locally produced pro-

grams were submitted by individuals, and which of these

programs were submitted by organizations. Individual

names appear next to many of the entries, but the individ-

ual could be a sponsor or contact person for an organiza-

tion, or an individual submitting their own production. De-

spite Access’s counsel’s assurances at the bench trial that

the documents would speak for themselves, there are no

demarcations in the documents from the relevant time pe-

riod to indicate which programs would have been subject

to the individual rate, and which ones would have been

subject to the organizational rate. Accordingly, for the rele-

vant years, the Court has calculated the minimum and max-

imum amounts that could have been charged if all the pro-

Appendix 15

12. In 1990, Access distributed approximately 54.5

hours of non-locally produced public access programming.

13. In 1990, under Access’s fee schedule, the 54.5

hours-of-non-local programming would have generated

between $4,087.50 and $5,450.00 in revenue.

14. In 1991, Access distributed approximately 67 hours

of non-locally produced public access programming.

15. In 1991, under Access’s fee schedule, the 67 hours

of non-local programming would have generated between

$5,025.00 and $6,700.00 in revenue.

16. In 1992, Access distributed approximately 59.5

hours of non-locally produced public access programming.

17. In 1992, under Access’s fee schedule, the 59.5

hours of non-local programming would have generated

between $4,462.50 and $5,950.00 in revenue.

18. From January 1, 1993 until March 15, 1993, Access

distributed approximately 7 hours of non-locally produced

public access programming. Def.’s Ex. 27.

19. From January 1, 1993 until March 15, 1993, under

Access’s fee schedule, the 7 hours of non-local program-

ming would have generated between $525 and $700 in

revenue.

20. Access did collect at least some of the fees it

charged for distributing non-locally produced programs.

21. Access did not collect all of the non-local distribu-

tion fees that it charged. In particular, Access never col-

lected any fees from N-TV for the times Access aired

grams were either all subject to the lower, individual rate,

or all subject to the higher, organizational rate.

Appendix 16

N-TV’s non- locally produced program “Airlink.” There is

no evidence before the Court that Access waived or other-

wise did not actually collect the distribution fees it charged

for any other non-locally produced programs during the

relevant years.

22. Non-local distribution fees were included in the

category of “user fees” on some financial statements, such

as the Income Statements for the years ending June 30,

1991 and 1992. The non-local distribution fees were listed

as separate “distribution” income or “distribution fees” in

other financial statements, such as the budget sheets and

the profit & loss statements.

23. Access’s budget for fiscal year 1990-91, under the

category of “Charges for Services,” forecast income of

$500/month from “Distribution” for a total projected in-

come of $6,000 from distribution fees in FY90-91.

24. Access’s fiscal year 1990-91 budget sheet lists the

following sources of income under the category of

“Charges for Services”: distribution, duplication, work-

shops, friends of AHCC, special events, and underwriting.

25. Access’s budget for fiscal year 1991-92, under the

category of “Fees for Services,” forecast income

of$500/month from “Distribution” for a total projected

income of $6,000 from distribution fees in FY91-92.

26. Access’s fiscal year 1991-92 budget sheet lists the

following sources of income under the category of ‘ ’Fees

for Services”: distribution, duplication, workshops, equip-

ment, talk shows, and underwriting. The categories of

“equipment” and “talk shows” have replaced the FY90-9 1

categories of ‘ ’friends of AHCC” and “special events.”

27. Access’s budget for fiscal year 1992-93, under the

category of “Fees for Services,” forecast income of

Appendix 17

$637/month from “Distribution” for a total projected in-

come of $7,644 from distribution fees in FY92-93.

28. Access’s fiscal year 1992-93 budget sheet lists the

following sources of income under the category of “Fees

for Services”: distribution, duplication, workshops, equip-

ment, talk shows, and underwriting. These are the same

categories as those listed in the FY91-92 budget.

29. Revenues generated from user fees, whether

non-local distribution fees or video equipment rental fees,

went into an unrestricted, general fund.

30. In fiscal year 1991-92, Access’s total income from

collected user fees was $48,464.°

31. In fiscal year 1992-93, Access’s total income from

collected user fees was $40,552.

32. In fiscal year 1993-94, Access’s total income from

collected user fees was $46,199.

33. Access collected $862.50 from distribution fees for

the month of July 1993.

34. From July 1,1997 until March 11, 1998, Access

collected $6,870 from non-local broadcast fees.

* There is no evidence directly indicating what portion

of the “user fees” collected by Access were distribution

fees for non-locally produced programs. However, the dis-

tribution fees did comprise some portion of the user fees.

The number of hours that non-locally produced programs

aired in conjunction with the budget forecasts for income

from the distribution fees provide indirect evidence of

what portion of the user fees was derived from distribution

fees.

i A i i

Appendix 18

35. In fiscal year 1991-92, Access generated $563,022

in revenues and had $621,734 in expenses. This resuited in

a net loss of $58,712 for 199].

36. In fiscal year 1992-93, Access generated $658,516

in revenues and had $634,586 in expenses. [his resulted in

a net profit of $23,930 for 1992.

37. In fiscal year 1993-94, Access generated $594,818

and expenses 0f$636,691. This resulted in a total loss

of$41,873 for 1993.

38. Access received a portion of its funding from fees

paid by Houston cable subscribers to the cable company,

which would in turn pay franchise fees to the C ity of Hous-

ton. The City of Houston then provided money to Access

from the franchise fees.

39. In February 1987, Access was expecting a 1989

budget shortfall of $350,000 if no additional revenue

sources were found.

40. Access’s Executive Director told the board of direc-

tors in April 1987 that the City of Houston funding would

be inadequate to sustain Access’s operations, even for the

next few years.

41. Access’s Executive Director reported to the board

of directors in August 1987 that Access only had enough

funds for another 3 to 4 months.

42. Access’s board of directors discussed user fee is-

sues at its April 1988 meeting, and the tension between

charging enough to generate sufficient revenue to ensure

Access’s survival while still making sufficient equipment

and facilities available to the residents of Houston free of

charge.

43. As of November 1989, Access was 11% below the

forecasted revenues for the year, but staff reduction had

Appendix 19

reduced expenses.

44. In February 1990, Access’s revenues were still be-

iow the revenues forecast in the budget, but Access’s Ex-

ecutive Director felt that the recently received $14,000

grant from a medical center would help to ease the situa-

tion.

45. In April 1990, Access’s revenues were still below

the revenues forecast in the budget.

46. Access’s fiscal year 1990-91 budget anticipated a

loss of approximately $104,000 for the year.

47. In June 1990, the ED suggested serious budget cuts

to be able to afford an additional salaried fund raising posi-

tion in an attempt to solve the revenue problems being

faced by Access. By way of example, the suggested cuts

included cutting the postage budget from $8,400 to $4,400,

cutting the printing budget from $7,404 to $4,404, cutting

the promotion budget from $27,852 to $852, cutting the

travel and training budget from $7,600 to $3,600, and cut-

ting the education and training budget from $4,081 to

$2,081.

48. In August 1990, Access’s equipment maintenance

costs, as well as demand for equipment and facilities, were

increasing.

49. In December 1990, there were 300 to 400 active

public access prograrnming producers utilizing Access

Houston.

50. In December 1990, Access Houston had reached its

maximum capability to serve the public, based on available

equipment and staff.

51. Increased public use of Access facilities in 1990 led

to an increase in repair costs for equipment for the next

year.

Appendix 20

52. Access’s fiscal year 1991-92 budget anticipated a

loss of approximately $107,000 for the year.

53. Access’s board was and is still concerned about a

“snowball effect” if they fail to provide a certain level of

services. If Access fails to offer a services of a certain

quality level, then no one will want to use the services and

fewer users leads to even lower quality levels in the future.

54. In May 1991, Access’s Executive Director ap-

proached the board about budgeting in $5,000 for upgrades

to the computer system and $50,000 for new production

equipment to help keep Access current.

55. Access’s board of directors regarded a $5,000 ex-

penditure as a significant expenditure for Access Houston.

56. In May 1991, the board of Access Houston dis-

cussed eliminating a survey which cost Access $6,000 to

reduce expenses. The board decided to continue to utilize

the survey despite the expense because they considered it

“crucial.”

57. Access’s fiscal year 1992-93 budget anticipated a

loss of approximately $62,000 for the year.

58. Auditors expressed “substantial doubt” about Ac-

cess’s ability to continue as a going concern in September

1993.

59. Access had cash flow problems during the early

1990’s. When the City did not pay Access on time, under-

writing and user fees were the two primary sources of rev-

enue available to Access.

60. Underwriting funds were difficult for Access to

obtain, at least in part because corporations were unwilling

to associate themselves with some of the programming

aired on Access. |

61. Access’s board felt that user fees were useful dur-

Appendix 21

ing times of cash flow problems, and that the cash gener-

ated by user fees was often “critically important” to Access

in the late 80’s and early 90’s, especially with regard to

equipment costs.

62. Currently, Access considers $30,000 in either in-

come or expenses to be significant to its operation.

63. In December 1990, Access’s Executive Director

reported to the board of directors that the average public

access program “cost” $294.’

64. Access never turned down a producer seeking to air

a program during the relevant time period due to scarcity

of air space.

65. At the time of the bench trial, Access had a budget

of approximately $900,000, with $700,000 of that being

supplied by the City of Houston.

Conclusions of Law

The Fifth Circuit has issued instructions on the stan-

dards that govern the Court’s current inquiry:

“Even a content-neutral regulation of speech on a

public forum must be narrowly tailored to serve a

significant government interest and must leave

open ample alternative channels of communica-

tion.” [Hays County Guardian v. Supple, 969 F.2d

111,118 (Sth Cir. 1992).] The burden is on Access

to show that the fee requirement is narrowly tai-

9 It is not clear whether the Executive Director was

referring to the cost to a producer, or to Access.

Appendix 22

lored to protect the identified interests. See id. at

119. A regulation is narrowly tailored “when it

does not ‘burden substantially more speech than is

necessary to further the government’s legitimate

interests.” [Jd. at 118 (quoting Ward v. Rock A-

gainst Racism, 491 U.S. 781, 799 (1989))]. In

other words, Access must show that the fee re-

quirement promotes a substantial governmental

interest that would be achieved less effectively

absent the regulation. [See United States v. Albert-

ini, 472 U.S. 675,689 (1985); Chicago Cable

Communications v. Chicago Cable Comm ‘n, 879

F.2d 1540, 1550 (7th Cir. 1989)].

Horton, 179 F .3d at 194. As the Fifth Circuit has already

found that the promotion of , ‘localism” in the context of

this case is an important government interest, see id. at

295, Access’s only burden is to show that the fee require-

ment was “narrowly tailored” to protect the interests of

localism. Access can meet this burden if it demonstrates

that the fee rule does not burden substantially more speech

than is necessary to further Access’s legitimate interest in

promoting localism, see id. at 194; Turner Broad. Sys. v.

FCC, 520 U.S. 180, 213-14 (1997), or if it demonstrates

that localism would have been promoted less effectively

absent the fee requirement, see Horton, 179 F.3d at 194;

Turner Broad. Sys, 520 U.S. at 214.

The Fifth Circuit and Plaintiffs both agree with Access

that promoting localism is an important and/or beneficial

interest for Access to pursue. Since its inception, Access

has had difficulty generating sufficient revenue to pursue

Appendix 23

this important interest. More specifically, Access has had

difficulty generating sufficient revenue to keep its doors

open to pursue any goal. At a minimum, Access has to

remain open in order to allow anyone, local or non-local,

to air a program on a Houston public access channel. As

explained by Access’s Executive Director Patricia Garling-

house at the bench trial, Access also needs to maintain a

certain level of quality in the facilities and services it offers

the public in order to remain a viable, operating entity.'°

Thus, in order to remain open, Access needs to be able to

fund not only the bare minimum of necessities, but also to

fund the salaries of knowledgeable staff and to fund cur-

rent equipment updates and purchases. From its start in

1987 through the relevant years in the early 1990's, Ac-

cess’s financial decisions reflect its attempts to offer the

best services it could on a very limited budget. Access of-

ten exceeded its annual budget during this time period and

was depleting its existing bank funds in order to offer the

minimal quality level it felt the public required.

During these initial years, Access’s main source of rev-

enue was grant money from the City of Houston. The grant

money came from franchise fees paid by the local cable

10 This is the snowball effect mentioned above. If Ac-

cess fails to provide an acceptable level of quality, then

- fewer people will use the services and Access will suffer

even greater income losses in the future, which in turn

leads to lower.quality, which leads to even fewer users, etc.

This continues until Access is forced to shut down for lack

of funding and/or failure to serve its mission.

Appendix 24

company to the City of Houston. Houston cable subscribers

paid fees to the cable company that funded the franchise

fee payments. Therefore, Access derived the bulk of its

revenues from money paid by Houston residents.

Access also derived revenue from some corporate un-

derwriting, but had difficulty obtaining any significant

corporate funding. Access’s other primary source of reve-

nue during this time period was the revenue derived from

user fees, including distribution fees for airing non-locally

produced programming. Access was often working on a

tight margin and all of the sources of revenue were consid-

ered important for keeping Access’s doors open.

Faced with such narrow margins and the reality of de-

pleting its only savings fund, the revenue generated by the

non-locally produced program distribution fees did aid

Access in staying open and providing decent services and

facilities to the public. Access received anywhere from

about $4000 to $7000 in revenues from these non-local

fees. During this same time period, a member of Access’s

board testified that $5000 was considered a “significant”

expenditure. His testimony was corroborated by minutes

from a 1991 board meeting which indicated that the board

debated whether or not to continue to pay for a $6,000 sur-

vey that it considered crucial, because $6,000 was an ex-

pense that was significant enough that it needed to be de-

bated by the board of directors. Under such economic con-

ditions, revenue in the $4000 - $7000 range would be sig-

nificant to Access.

The nature of public access programming is such that

Appendix 25 -

the only “cost” for airing any particular program is the por-

tion of overhead that can be attributed to any given pro-

gram. Houston did not have a problem with sufficient pub-

lic access channel air time during the years in question.

Rather, witnesses for both sides testified that no producer

was ever denied air time due to a scarcity of air time.

Given an adequate supply of air time, it is tempting to con-

clude that it “cost” Access nothing to air any given pro-

gram. If Access had sufficient revenues to pay its over-

head, keep its equipment updated, and staff paid, this

would be true. However, the reality was that Access lacked

sufficient revenues to pay its entire staff or to keep its

equipment as current as the public demanded. Therefore,

while an additional program did not add to Access’s ex-

penses, a portion of Access’s general expenses had to be

attributed to each program aired until Access reached the

magical point where its general expenses had been met.

The airtime scarcity faced by Access in this situation was

not the scarcity of a particular time slot, but the potential

scarcity of any airtime for anyone if Access went under for

lack of funding. Instead of focusing on the scarcity of air-

time, or lack thereof, the appropriate focus is on the scar-

city of resources that go into putting any given program on

the air. This often included transferring a program to the

proper format, which meant equipment use, but always

included staff to place the program on the air. Thus, Ac-

cess’s scarcity of staff resources meant that the available

staff time to assist in airing programs was rationed.

Not only did the revenues generated by the distribution

fees help to prevent an overall scarcity of air time and ease

the scarcity of staff time, but they did help “reimburse Ac-

Appendix 26

cess’s costs of airing non-locally-produced programs.”

Horton, 179 F 3d at 196. As stated above, the only way to

assess Access’s costs for airing any program is to attribute

a proportionate amount of Access’s overall costs to each

program aired. Houston residents already contributed to

paying Access’s overall costs with their cable subscription

fees. Furthermore, local producers also helped to contrib-

ute income to Access in the form of user fees paid to use

the equipment and to take Access’s workshops. The only

contribution made by non-local producers was the distribu-

tion fee.'' Without the fee, they would have contributed

nothing to off-setting Access’s costs in keeping its doors

and air open. Admittedly, a Houston resident who did not

Subscribe to cable and did not use Access’s facilities or

services, could air a tape without contributing any income

to help reimburse Access’s costs in airing his or her pro-

gram. However, in order to be narrowly tailored, a fee does

not have to an exact fit as long the fee’s burden is not sub-

stantially broader than necessary to achieve the goal of

promoting localism. See Ward v. Rock against Racism, 491

U.S. 781,798 (1989). Even though some Houston users

may benefit from Access without contributing anything

does not mean the distribution fee is too heavy a burden to

'' While non-local producers were welcome to come to

Houston and use Access’s equipment, as discussed above,

such a move would often convert the producer from a

non-local producer into a local producer. Once the program

was produced locally, the producer’s program would not be

subject to the non-locally produced program distribution

fees.

Appendix 27 -

impose on non-local producers in an attempt to have them

contribute something to the service they are utilizing. The

only burden the distribution fees place on the expression of

speech is a minimal fee that is directly related to the

amount of airtime the producer receives. It is not an arbi-

trary fee, but is directly correlated to the benefits a pro-

ducer derives from Access. To place this minimal fee bur-

den on a category of persons that otherwise does not con-

tribute in any fashion to the costs of keeping public access

airtime available is a reasonable way to help reimburse Ac-

cess’s general costs of keeping the facilities and channels

open to the public. Thus, it appears that the fees paid by

non-local producers to distribute their programs to the

Houston airways not only helped to off-set Access’s costs

attributable to airing them, but did so without placing an

arbitrary burden on the non-local producer.

The Fifth Circuit also suggested that Access could meet

its burden of showing that the fee was narrowly tailored by

showing that the revenue from the distribution fees made

“any realistic dent in the costs borne by cable subscribers

for the production facilities.” Horton, 179 F .3d at 196.

The parties spent much time at the bench trial discussing

whether the fees made such a “realistic dent.” Initially, the

Court is perplexed by how to treat this instruction. In order

to find that the revenues made a “realistic dent” in Ac-

cess’s costs, it would be necessary for Access to show that

it received more than a minimal amount of revenue from

the fees. In order to receive such a significant amount, Ac-

cess would either have to have encouraged many non-local

producers to air their programs on Access, and thus pay the

fee, or Access would have had to charge more per hour for

Appendix 28

a non-local producer to air a program. The first option in-

terferes with Access’s stated goal of providing a forum-for

the residents of Houston to voice their opinions by encour-

aging the voice of non-Houstonians to fill Access’s air-

time. The second option places an even greater burden on

free speech by forcing producers to pay more per hour of

airtime. If Access had charged $1000 per hour instead of

$100, the revenues would have been greater for the pro-

grams that actually aired, but the higher cost may have

deterred some non-local producers from paying to air their

programs. While Access may not have been seeking to

promote the voices of non-local producers, neither did it

wish to chill their messages. Rather, Access simply sought

to have a category of users, that otherwise did not contrib-

ute anything to offset Access’s costs in providing airtime,

contribute to Access’s scanty income so that Access could

provide services for future producers and promote localism

by providing a forum for the residents of Houston to voice

their viewpoints.

Recognizing that the First Amendment would not be

served by having Access charge non-local producers more,

the Court assumes that the Fifth Circuit was not actually

looking for Access to show that the fee revenues made a

dent in the Access’s total annual costs of running the pro-

_ duction facilities, but just that Access was receiving some

benefit that justified the burden of imposing the fees.

Showing that Access was receiving enough of a benefit to

qualify as a “realistic dent” would support a finding of a

reasonable fit between the goal, paying the overwhelming

costs of keeping Access open to give Houston residents a

forum to voice their local concerns and opinions, and the

Appendix 29

regulation, a $75 or $100 charge for airing non-locally

produced programs. In other words, the “realistic dent” is

a way for Access to show that it did not burden substan-

tially more speech than was necessary to achieve its goal.

See Turner Broad. Sys., 520 USS. at 213-14.

Access has met its burden of showing that the fees did

not burden substantially more speech than was necessary

to help promote localism. As discussed above, Access

needed revenue to achieve its goals of staying open to pro-

mote localism. Access chose to charge local producers user

fees, and to charge the only class of persons that was not

otherwise conceivably contributing any revenue, non-local

producers, a distribution fee. This is burden on the speech

of the non-local producers. However, Access was so des-

perately in need of funds that it needed to burden them to

a certain degree to achieve its goal. Access chose an

amount that was consistent with the amounts it charged

non-local producers to use its equipment and facilities. The

amount was large enough to generate some much needed

revenue. The revenue went into a general fund that paid for

such things as staff salaries and the “crucial” $6,000 sur-

vey the board wanted in 1991. However, the amount of the

fee was also small enough that most organizations and in-

dividuals should be able to afford it, which minimizes the

amount of speech ultimately restricted by the existence of

the fee. If Access had charged less, the benefits Access

derived from the amount may not have been worth the

Appendix 30

slight burden the fee placed on non-local producers. '”

'? Access may have still been able to derive a benefit

if it had only charged individuals and organizations

$50/hour and $75/hour respectively, rather than $75/hour

and $100/hour. However, as the Fifth Circuit has already

found that Access’s fee was a content-neutral restriction,

Access does not need to show that its fee system was the

least restrictive means available to achieve its goal of pro-

moting localism. See City of Erie v. Pap’s A.M., 529 U.S.

277, 301-02 (2000) (finding that a regulation need not be

the least restrictive alternative to be considered narrowly

tailored); Turner Broad. Sys., 520 U.S. at 217-18 (same);

Ward v. Rock against Racism, 491 U.S. 781, 798 (1989)

(same). It is “well established” that when the test is

whether a regulation is “narrowly tailored,” “a regulation’s

validity does not turn on a judge’s agreement with the re-

sponsible decisionmaker concerning the most appropriate

method for promoting significant government interests.”

Turner Broad. Sys., 520 U.S. at 218. Thus, even if slightly

lower fees would have generated benefits for Access while

imposing less of a burden on speech, it is not the Court’s

place to make such judgments. As long as the fees actually

charged did not burden substantially more speech than nec-

essary, they do not violate the First Amendment even if

they were either a little higher or lower than necessary. See

Ward v. Rock against Racism, 491 U.S. at 800 (“So long as

the means chosen are not substantially broader than neces-

sary to achieve the government’s interest, however, the

regulation will not be invalid simply because a court con-

cludes that the government’s interest could be adequately

.«pAnnenslix 31

However, given the amount actually charged by Access,

the burden on the speech of non-local producers was still

minimal, but Access derived a notable benefit. The signifi-

cance of this benefit is sufficient to show that the revenue

generated made a “realistic dent,” especially when consid-

ered in relation to the moderate burden being imposed.

_In addition to demonstrating that the fee rule does not

burden substantially more speech than is necessary to fur-

ther Access’s legitimate interest in promoting localism in

the ways discussed above, Access can show that the fee

requirement was “narrowly tailored” if it demonstrates that

localism would have been promoted less effectively absent

the fee requirement. It does not appear from the evidence

before the Court that Access would have had to stop oper-

ating in any given year if it had not charged the non-local

distribution fees. However, it is not necessary for Access

to show that without the revenue from non-local fees it

would not have been able to function at all, only that it

would have less effectively served its function of providing

production facilities and services to the residents of Hous-

ton seeking to express their views. While Access would

have found a way to continue to operate without the type

of sums in question, it would have operated less effec-

tively. Access was already operating on a very tight .bud-

get and it was only offering the bare minimum of the types

and quality of services it felt the public required. Any extra

revenue of the amounts generated by the fees helped to

provide, for example, crucial surveys, or necessary com-

served by some less-speech-restrictive alternative.”’).

Appendix 32

puter upgrades, or to contribute to salaries for necessary

employees. If these fees had not generated that revenue,

one of those expenses, or some similar expense, would

have been cut from the budget. Without the computer up-

grade or the surveyor quality employees, Access would

have been less effective at providing a forum for the resi-

dents of Houston to express their views and concerns.

Thus, Access has met its burden of showing that its legiti-

mate interest, promoting localism, would have been

achieved less effectively absent the fee requirement.

Accordingly, Access has met its burden to show that

the rule imposing distribution fees for non-locally pro-

duced programs was narrowly tailored to serve its legiti-

mate interest in promoting localism.

Conclusion

For the reason given above, the Court will enter judg-

ment in favor of Access in an order entered on even date

herewith.

It is so ORDERED.

Signed this 31st day of March, 2003.

JOHN D. RAINEY

UNITED STATES DISTRICT JUDGE

Appendix 33

APPENDIX D

UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 98-20031

ROBERT HORTON, NATIONALIST

TELEVISION, a Texas Non-Profit Corporation;

and BARRY HACKNEY,

Plaintiffs-Appellants,

versus

CITY OF HOUSTON, TEXAS and

ACCESS HOUSTON CABLE CORPORATION,

Defendants-Appellees.

Appeal from the United States District Court

for the Southern District of Texas

June 18, 1999

Before KING, Chief Judge, JOLLY, and JONES, Circuit

Judges.

EDITH H. JONES, Circuit Judge:

At issue in this appeal is whether Access Houston Ca-

Appendix 34

ble Corporation (“Access”), a “PEG” cable channel,’ can,

consistent with the First Amendment, charge a fee to ca-

ble-cast programs nc “locally produced” in and around

Houston, Texas. We conclude that Access Houston’s fee

requirement is a content-neutral regulation which imple-

ments a significant governmental interest in promoting

localism, but Access has not met its burden of proving that

the fee is narrowly tailored to serve that interest. We there-

fore reverse the grant of summary judgment and remand

for further proceedings.

BACKGROUND

The City of Houston granted a cable franchise to

Warner Cable Communications (“Warner”) that required

Warner to designate at least four PEG channels for the

city’s benefit. Houston then engaged Access to manage

the channels, including a public access channel? Access

is not a typical cable channel: It does not operate for profit,

it does not have an editorial board that selects program-

ming for cable-cast, and it does not sell advertising space.

' PEG channels are those reserved for public, educa-

tional or governmental use by the municipal franchise

agreement with a cable operator. See 47 U.S.C. § 531 and

53 1(e).

? Under the franchise agreement, the City of Houston

can require Warner to make available an additional four

cable channels if certain conditions are met.

* That Access is a state actor is undisputed on appeal.

Appendix 35

Instead, Access’s programming space is open to any indi-

vidual or organization who wishes to televise constitution-

ally protected speech. Access neither produces programs

nor broadcasts commercial programs. To promote the orig-

inal programming on which it relies, Access offers (for a

nominal fee) video cameras and other production equip-

ment, training workshops, studio space and other Services.

Access touts that it will broadcast any non-commercial

program as long as the program engages in constitutionally

‘protected speech and complies with various rules designed

to allocate air time among the programmers. Access em-

ployees do not pre-screen submitted programs to determine

whether they comply with the non-commercial speech rule

or the First Amendment; instead, Access requires program

providers to accept liability for the content of their pro-

grams by signing a Program Contract before the program

will be aired.’

4 Pursuant to Rule 2.A-5, all program providers who

wish to schedule broadcast time with Access must first

sign a Program Contract.

The Rule states that,

2.A-5 PROGRAM CONTRACT AND RESPONSI-

BILITY: Before access programs are scheduled for

cable-cast, the access program provider must sign a

Program Contract which holds the program pro-

vider liable for content of the program and pay all

applicable fees. In signing the Program Contract,

Appendix 36

At the time this dispute arose, Access sought to en-

courage programs “that reflect[] the activities, culture, con-

cerns, and interests of the citizens of Houston and []pro-

mote a free exchange of ideas, information and understand-

ing.” To fulfill its contractual obligation with the City,

Access's Board of Directors adopted a rule, which has

been in effect since 1988, providing for “locally produced”

programs to be broadcast free of charge. To qualify as a

“locally produced program,” at least 50 percent of the pro-

gram must have been shot within the Houston Standard

Metropolitan Statistical Area. Programs that do not comply

with the “locally produced” rule are assessed a fee: indi-

viduals who submit non-local programs must pay $75 for

each hour of programming, while organizations are

charged $100 per hour. Because Access does not pre-

screen submitted programs, it cannot initially determine

whether a program complies with the rule. Access relies on

each program provider voluntarily to disclose whether the

submitted program was locally produced.

the program provider agrees in writing that his or

her program does not include any form of “consti-

tutionaliy unprotected speech.”

> Access Houston ByLaws Art. II] (1986). After the

events in this case, in its 1994 contract with the City of

Houston, the requirement to support localism became more

explicit: “a minimum of 51 percent of the total hours pro-

grammed on the Access channel shall be locally produced

in the Houston metropolitan area.”

Appen. x 37

In March 1992, Appellant Nationalist Television

(“N-TV”), as agent for Houston resident appellant Robert

Horton, submitted a 30-minute program for cable-cast enti-

tled Airlink.’ After a month had passed and the program

had not been cable-cast, N-TV wrote to the Houston City

Attomey’s office demanding that Access immediately ca-

ble-cast Airlink. The City Attorney replied that Access

operates independently of the City and that Houston cannot

require Access to broadcast Airlink. In addition, N-TV was

informed that, according to Access, N-TV had not com-

plied with the procedural requirements necessary to broad-

cast Airlink and that N-TV should directly contact Access

to complete the application process. Despite this notifica-

tion and the receipt of a complete copy of the Access pro-

cedural rules, N-TV continued to complain to the Houston

City Attorney’s Office rather than to Access. Months later,

N-TV turned to Access and learned that it, like all other

program providers, must sign a Program Contract. Two

months more passed, N-TV finally signed the requested

Program Contract, and Access began cable-casting Airlink.

Airlink was produced at a studio in Mississippi and did

not qualify as a “locally produced program.” N-TV was

6 The content of Airlink is described as “pro-majority”

in some portions of the record and “white supremacist” in

other parts of the record.

Appendix 38

thus required to pay the $100 cable-cast fee.’ N-TV refused

to pay, arguing that the fee violated the First Amendment,

and filed the present lawsuit seeking a declaratory judg-

ment, a temporary restraining order, and a permanent in-

junction. Ironically, Access began regularly cablecasting

Airlink just after the suit was filed, from December 1992

through February 1993. When N-TV refused to pay fees

for the three months of programming that had been aired,

Airlink was canceled.

Immediately after appellants filed suit, the district court

held a hearing to rule on appellants’ request for a tempo-

rary restraining order (“TRO hearing”). The district court

denied the request and offered to set the case for trial. Each

party then moved for summary judgment. The court held in

favor of Access and the city, ruling that the fee require-

ment is a facially valid, content-neutral regulation inciden-

tal to free speech under the test articulated in United States

v. O'Brien, 391 U.S. 367, 88 S. Ct. 1673 (1968), and that

the appellants failed to raise a genuine issue of material

fact regarding whether the fee requirement was unconstitu-

tional as applied.

STANDARD OF REVIEW

The standard of review of a summary judgment at the

appellate level is de novo. Summary judgment is proper if

“the pleadings, depositions, answers to interrogatories, and

” Since Airlink was a half-hour program, the $100 fee

was prorated, making N-TV liable for $50 per cable-cast.

Appendix 39

admissions on file, together with any affidavits, if any,

show that there is no genuine issue as to any material fact

and that the moving party is entitled to judgment as a mat-

ter of law.” Fed. R. Civ. P. 56(c); see also Celotex Corp. v.

Catrett, 477 U.S. 317, 322-24, 106 S. Ct. 2548 (1986).

Under this standard, all fact questions must be viewed in

the light most favorable to the non-moving party, and ques-

tions of law are reviewed de novo. Hassan v. Lubbock

Indep. Sch. Dist., 55 F.3d 1075, 1079 (Sth Cir. 1995).

DISCUSSION

N-TV scatter-guns its First Amendment arguments

against the Access fee for non-locally-produced programs.

Attacking the fees both facially and as applied, N-TV as-

serts that the fee rule grants overbroad, arbitrary discretion

to Access administrators, encouraging content-based dis-

crimination against programs. More fundamentally, N-TV

contends that the fee regulation is an impermissible con-

tent-based rule. N-TV also levels equal protection,

overbreadth and vagueness challenges to the fees, but these

arguments were not raised in the district court and will not

be considered here.

Fitting the PEG channels into the familiar holes of First

Amendment jurisprudence is not easy. The premise of our

discussion is that programmers have some kind of First

Amendment rights to share the podium at a PEG local ac-

cess channel set aside by Houston’s cable franchise con-

tract. The Supreme Court has implied that all of the partici-

pants in cable television-programmers, cable operators, TV

broadcasters, PEG channels -- enjoy free speech rights, but

Appendix 40

the limits of those competing and potentially conflicting

rights are far from clear. See generally, Pluralism on the

Bench: Understanding Denver Area Educational Telecom-

munications Consortium v. FC C, 97 Colum. L. Rev. 1182

(1997).

The first conundrum relates to the dubious status of

PEG channels, which municipalities have the authority to

set aside in their cable franchise agreements with cable

operators. See 47 U.S.C. § 531(a). In the “must-carry”

case, the Supreme Court upheld a federal law requiring

cable operators to make available transmission space for

local TV broadcasters. Turner Broadcasting System v.

FCC, 512 U.S. 622, 114 S. Ct. 2445 (1994). The Court

concluded that the “must-carry” provisions are a con-

tent-neutral regulation designed, not to force a particular

type of speech upon cable operators, but to further the

non-speech-related goals of protecting local broadcasters

and assuring free TV access to citizens who lack cable

connections. The four dissenters in Turner essentially

Stated, however, that forced set-aside of PEG channels is

a content-related imposition on cable operators, Turner

512 U.S. at 675, 114 S. Ct. at 2476 (O’Conner, J., concur-

ring in part and dissenting in part), and the majority deci-

sion offers no rationale opposed to such a conclusion.

Indeed, the majority emphasized that neither the

must-carry rule nor laws and rules presently applicable to

broadcasting (e.g. on non-commercial Stations) directs the

content of the programs. 7; urner, 512 U.S. at 649-65] , 114

S. Ct. at 2462-63.

Appendix 41

Justice Thomas reiterated the PEG constitutionality prob-

lem and scholarly discussions of it in the Court’s most re-

cent cable decision, only to note that the issue had not been

raised. See Denver Area Educ. Telecomm. Consortium v.

FCC, _US.__, 116 S. Ct. 2374 (1996). The ultimate

fate of PEGs, including Houston’s local access channel,

remains in doubt, but is not to be decided in this case.

The second conundrum arises from the implicit conces-

sion of Access that the local access channel represents a

government-owned designated public forum. Nevertheless,

the Supreme Court has cautioned that “the public forum

doctrine should not be extended ina mechanical way to the

very different context of public television-broadcasting.”

Arkansas Educ. Television Comm. v. Forbes, __ U.S. _.,

118 S. Ct. 1633, at 1639 (1998). In a later cable regulation

case, seven justices of the Court either rejected or declined

to consider Justice Kennedy’s assertion that a local access

channel is a public forum available to citizens under the

most exacting constitutional standards. Compare Denver

Area, _U.S.at__, 1 16 S. Ct. at 2404-05 (Kennedy, J.,

concurring in part and dissenting in part), withid. _US.

at _,116S.Ct.at 2388-89 (Breyer, J.) (refusing to con-

sider public forum doctrine), and id. _US.at____, 116

S. Ct. at 2426-28 (Thomas, J., concurring in the judgment

in part and dissenting in part) (PEG channel is not a public

forum). If one were either to press the analogy between

Access and a classic public television station or to reject

the public forum doctrine for local access channels, then

Appendix 42

Access would enjoy virtually unfettered programming dis-

cretion. Access does not request such latitude, however, so

the arguments that Access is not a public forum or is a lim-

ited public forum are not before us.

The consequence, for First Amendment purposes, of

ascribing particular forum (or non-forum) characteristics

to Access lies in the strictness of legal scrutiny that will be

applied to Access’s fee regulation. Access contends that

the regulation is subject to “intermediate scrutiny” because

it has nothing to do with the content of programmers’

speech. Turner, 512 U.S. at 642, 114S. Ct. at 2459. N-TV

argues and Access concedes that were the regulation con-

tent-related, it would be subject to strict scrutiny. Jd. And

this dichotomy of regulations has been developed to gov-

ern what may be done to limit speech in either a traditional

public forum or a designated public forum.’ See 4 Ronald

D. Rotunda & John E. Nowak, Treatise on C. onstitutional

Law § 20.47 at 310-11 (2d Ed. 1992). Although it is im-

possible to state whether a local access channel should be

analyzed by reference to the public forum doctrines, the

dichotomy of standards seems to apply to broadcast regula-

tions.

The nub of the parties’ disagreement turns upon

” If Access were, instead, a limited public forum or a

nonpublic forum it would be permitted to place reasonable

restrictions on the speech of programmers. See Forbes, __

U.S. at__, 118 S. Ct. at 1640-42. But it plainly does not

fit in these categories.

Appendix 43

whether the fee charged for non-locally produced programs

is content-neutral, or, as N-TV would have it, a ruse for

influencing the content of programs that will be cable-cast.

The Supreme Court has observed that “[dJeciding

whether a particular regulation is content based or content

neutral is not always a simple task.” Turner, 512 US. at

642, 114 S. Ct. at 2459. Regulations that “by their terms

distinguish favored speech from disfavored speech on the

basis of ideas or views expressed are content based.” /d.

$12 US. at 643, 114 S. Ct. at 2459. Thus, a rule that is

applied because of disagreement with a message presented

or a rule that has a substantial risk of eliminating certain

ideas or viewpoints from the public dialogue are con-

tent-based. See id. 512 U.S. at 642, 114 S. Ct. at 2459;

Clark v. Community for Creative Non- Violence, 468 U.S.

288, 295, 104 S. Ct. 3065, 3070 (1984). If, on the other

hand, the regulation is justified without reference to the

content of the speech or serves purposes unrelated to the

content, it is a content-neutral regulation, even if it has an

incidental effect on some speakers or messages but not

others. See Ward v. Rock Against Racism, 491 U.S. 781,

791, 109 S. Ct. 2746, 2754 (1989); Boos v. Barry, 485 US.

312, 320, 108 S. Ct. 1157, 1163 (1988). Finally, this court

has noted that government regulations that apply even-

handedly to all speakers weigh in favor of finding con-

tent-neutrality. See International Soc 'y for Krishna Con-

sciousness of New Orleans, Inc. v. Baton Rouge, 876 F.2d

494, 497 (Sth Cir. 1989).

We conclude that Access’s fee rule is content-neutral

because the rule does not, by its terms, distinguish between

Appendix 44

favored speech and disfavored speech. Access does not

examine the content or message of submitted programs in

determining whether to impose a fee. Compare Frisby v.

Schultz, 487 U.S. at 474, 481-82, 108 S. Ct. 2495, at 2501

(1988) (finding that a municipal ordinance prohibiting all

picketing near a residence was content-neutral because

government did not have to look at the content to deter-

mine where picketers can demonstrate), with Boos, 485

U.S. 312, at 318-19, 108 S. Ct. 1157, at 1162 (1988) (find-

ing that an ordinance prohibiting demonstrations in front

of foreign embassies that are critical of the foreign govern-

ment was content based because government necessarily

had to review content to determine the legality of the dem-

Onstration). Access’s fee regulation is an evenhanded

charge on all providers submitting non-locally-produced

programming, regardless of the content or viewpoint con-

tained in the program. In addition, the fee rule can be justi-

fied without referring to the content of any of the submit-

ted programs. See Ward, 491 U.S. at 791, 109 S. Ct. at

2754. As discussed infra, Access asserts that the fee rule

promotes local ideas and debate and helps fund equipment

and training for local producers and the cost of Acvess’s

operations. See id.; Boos, 485 U.S. at 320, 108 S. Ct. at

1163. Finally, we rely on a Seventh Circuit case that up-

held as content-neutral, albeit before Turner, a Chicago

rule requiring locally-produced programs. Chicago Cable

Comm. v. Chicago Cable Comm n, 879 F.2d 1540 (7th Cir.

1989).

To the extent that Access’s fee rule unabashedly prefers

locally-produced programs, we recognize that it is not un-

assailable. The dissenters in Turner criticized legislative

Appendix 45

preferences for “diversity of viewpoints, for localism, for

educational programming . . .” as content-based regula-

tions. Turner, 512 U.S. at 675, 114 S. Ct. at 2476. They

noted that no matter how praise-worthy the objectives,

government may not favor one set of speakers over an-

other. See id. 512 U.S. at 677-78, 114 S. Ct. at 2476-77.

Only a four-member plurality in Turner directly responded

to arguments concerning localism, but the majority opin-

ions emphasized the purely economic reasons why Con-

gress wanted to support local broadcasters by requiring

“must-carry” by cable operators. The non-speech-related

basis for the rule made it content-neutral. See id. 512 U.S.

at 645, 114S. Ct. at 2461.

In this case, one may argue that while the interest in

“localism” is furthered by the fee rule, not only is there no

direct content regulation, but the fee compensates the citi-

zens of Houston in a small way for the costs incurred when

non-locally-produced programs air on the Access channel.

The fee subsidizes Access and substitutes for the local re-

sources that could otherwise be utilized to produce pro-

grams. The fee thus has an independent economic basis

more closely analogous to the content-neutral must-carry

rule than to a purely content-related localism preference.

We therefore conclude that the non-locally-produced fee

rule is content-neutral.

The standard for evaluating the constitutionality of

content-neutral regulations was articulated in O’Brien:

[A] government regulation is sufficiently justified

{{j if it is within the constitutional power of the

ee ee ge ee a ee eee oe eee

Ce ee Pee

i et ee:

Appendix 46

Government; [2] if it furthers an important or sub-

stantial governmental interest; [3] if the govern-

mental interest is unrelated to the suppression of

free expression; and [4] if the incidental restriction

on alleged First Amendment freedoms is no

greater than is essential to the furtherance of that

interest.

O'Brien, 391 U.S. at 377, 88 S. Ct. at 1679. As Ac-

cess’s fee regulation is on balance 2 content-neutral rule,

the third prong of the O’Brien test has been satisfied, and,

germane to the first prong, Houston has the power to spon-

sor a public access cable channel and raise revenues for its

operation.

Still at issue are the second and fourth O’Brien stan-

dards. “Even a content-neutral regulation of speech on a

public forum must be narrowly tailored to serve a signifi-

cant government interest and must leave open ample alter-

native channels of communication.” Hays County Guard-

ian v. Supple, 969 F.2d 111, 118 (Sth Cir. 1992). The bur-

den is on Access to show that the fee requirement is nar-

rowly tailored to protect the identified interests. See id. at

119. A regulation is narrowly tailored “when it does not

‘burden substantially more speech than is necessary to fur-

ther the government’s legitimate interests.’” Jd. at 118

(quoting Ward, 491 U.S. at 799, 109 S. Ct. at 2758). In

other words, Access must show that the fee requirement

promotes a substantial governmental interest that would be

achieved less effectively absent the regulation. See United

States v. Albertini, 472 U.S. 675, 689, 105 S. Ct. 2897,

2906 (1985); Chicago Cable, 879 F.2d at 1550.

Appendix 47

Access argues that the fee requirement promotes the

substantial governmental interest in “localism.” According a

to Access, the fee encourages residents to produce pro-

grams featuring topics of local concern which in turn en-

hances community self-expression and fosters direct com-

munication among residents. Since a portion of the reve-

nues derived from Houston residents’ cable bills funds Ac-

cess’s operations, residents should not have to subsidize

non-locally-produced programs.'° Similarly, Access urges

that the revenues generated from the fee train local produc-

ers, purchase production equipment, and fund the general

operations of Access. Finally, encouraging residents to

produce local programming increases job opportunities and

'0 At the TRO hearing, the executive director for Ac-

cess expanded on this theme, testifying that,

the residents of the City of Houston, through their

cable bills, underwrote the costs of the facilitation

that our organization provides of putting the pro-

grams together, scheduling them and putting them

on the cable system. We’ve never had a problem

with where programs come from in terms of con-

tent. We frankly don’t care about what the content

is. What we were concerned about was it seemed

unfair to us that the residents of City of Houston

should subsidize programs that were from some-

where else and that, if someone wished to use the

facilities, that they should contribute to sustaining

the organization that had to help facilitate the users

of all the programs on the channels.

Appendix 48

career development of Houston residents. We agree -- and

N-TV does not dispute'' -- that the promotion of “local-

ism” in this context is an important governmental interest.

See Chicago Cable, 879 F.2d at 1549-50.

That Access’s asserted interests are substantial in the

abstract does not mean, however, that the fee regulation

fulfills them and is narrowly tailored to protect those inter-

ests. The fee rule will be considered narrowly tailored if

- Access can demonstrate that it does not “burden substan-

tially more speech than is necessary to further the govern-

ment’s legitimate interests.” Ward, 491 U.S. at 799, 109 S.

Ct. at2758. According to Access’s tules, “locally produced

programs” are aired free of charge, while “programs pro-

duced elsewhere” are charged either $75 or $100 per hour.

Access defines local programming as “[a]ny program sub-

mitted for cable-cast containing program material of which

fifty (SO) percent or greater was shot” within the Houston

Standard Metropolitan Statistical Area.

Access has failed to demonstrate narrow tailoring of the

fee rule as a matter of law. It has not shown that, absent the

fee charged to providers of non-local programs, its interest

in promoting localism “would be achieved less effec-

tively.” Albertini, 472 US. at 689, 105 S. Ct. at 2906. Ac-

cess has not provided any evidence linking the amount

charged to non-local producers and the promotion of local-

'' At oral argument, N-TV agreed that Houston has a

substantial interest in promoting localism.

Appendix 49

ism. More precisely, Access has not shown the amount of

revenue generated from the fee, the number of providers

who have been charged the fee, or whether the fees have

actually helped purchase equipment, train producers, en-

hance community self-expression, or offset amounts under-

written by Houston cable subscribers. Access acknowl-

edged there is no scarcity of time available for programs,

so the fee plays no role in rationing airtime favorably to

locally produced programs.

Access’s general fee schedule demonstrates the lack of

correlation between the amount charged to non-locally

produced programs and its stated justification for imposing

a fee. Access heavily subsidizes most of the services and

equipment it offers to the public. Next to each item listed

on the general fee schedule, Access lists the cost of the

item, the amount subsidized by Access, and the resulting

net cost to the producer.'? Notably, however, the fees

charged to program providers for cable-casting their pro-

grams are not itemized by actual cost, amount subsidized,

and net cost to provider. The general fee schedule merely

states that Access airs locally produced programs free of

charge, while programs produced elsewhere are charged

'2 For example, the actual cost of renting a “Video-

Mobile Portable Kit” is $250; however, Access pays $190

of the cost via a grant, leaving the producer liable for only

$60. See Access Houston Cable Corporation's Objections

to Proposed Order Granting Summary Judgment, Exhibit

D (fee schedule effective May 19, 1988).

Appendix 50

either $75 or $100 per hour, depending on whether the

provider is an individual or organization. Not only is there

no evidence how much of the fee charged for non-local-

ly-produced programs compensates Access for its ca-

ble-casting costs of those programs, but Access’s executive

director testified that he had recommended abolition of the

fee to the Board of Directors. The inescapable conclusion

is that the fee serves no measurable purpose.

Because Access has not met its summary judgment

burden to sustain the fee, this case must be reversed and

remanded. See Turner, 512 US. at 667-68, 114 S. Ct. at

2471-72 (reversed and remanded for further factual devel-

opment). On remand, Access should prove how much reve-

nue accrues from the fee for non-locally-produced pro-

grams, as well as the purposes for which it uses the reve-

nue. If the revenue is minimal -- that is, if it fails to ration

Scare airtime, to reimburse Access’s costs of airing

non-locally-produced programs, or to make any realistic

dent in the costs borne by cable subscribers for the produc-

tion facilities -- then the district court may conclude that

the fee suppresses protected speech without providing any

asserted benefits.

Further judicial efforts would be avoided, however, if

we accept N-TV’s alternative argument that the fee rule

confers excessive discretion upon Access’s administrator

and permits content-based discrimination. According to

N-TV, Access’s own interpretation of the fee rule under-

mines the argument that it is narrowly tailored. See Forsyth

County v. The Nationalist Movement, 505 U.S. 123, 131,

112 S. Ct. 2395, 2402 (1992) (courts should consider the

Appendix 51

government’s interpretation of a challenged regulation

when addressing facial challenges). In Forsyth County, the

Supreme Court addressed whether a county could constitu-

tionally charge a fee to speakers who wished to hold a rally

in a traditional public forum. See id. 505 U.S. at 129, 112

S. Ct. at 2400. The Court struck down tke ordinance be-

cause it vested too much discretion in thecounty adminis-

trator: the administrator could, without objective guidance,

determine how much or whether to charg? the demonstra-

tors a permit fee of up to $1,000. See id. 505 U.S. at

132-33, 112 S. Ct. at 2402-03. In the present case, the Ex-

ecutive Director of Access felt that he could independently

determine whether to charge a fee for certain non-local-

ly-produced programs. During the TRO “earing, the fol-

lowing exchange occurred between Aprellants’ attorney

and Access’s Executive Director:

Question: What about a guy that stooped by the other

day and just happened topick up some of

your material and the receptionist was

there and I said, “You knew, what if some-

body wanted to go up ané get an interview

in Dallas with Ross Pot, shoot it up

there” and she said, “fhat will be all

right?” Would that be olay with you?

Answer: _ It would be okay with ne.

Question: No charge for that?

Answer: Nocharge.

Question:

Answer:

Question:

Answer:

Appendix 52

Okay. Now, just assume for a moment that

here is a tape and we’re showing it and

there is Senator Gramm. He’s seated at a

desk. There’s books behind him. And he’s

sitting there talking about taxes. Every-

body is concerned about them these days.

Any problem putting that on?

No.

Okay. Now, let’s say that it’s on the air

and one of your staff comes in and says

“Mr. Cantrell, you know, I’ve been in Sen-

ator Gramm’s office in Washington and I

recognize those books. That was filmed in

his office in Washington.” No real prob-

lem, though?

No real problem.

Other similar exchanges occurred during the TRO hearing,

each one suggesting that Access’s administrator cou!d, at

his discretion, make special exceptions to the fee ruie de-

pending upon the circumstances presented.'* The discretion

'> For instance, in another exchange, Access’s Execu-

tive Director testified as follows:

Counsel: Let’s say that Mr. Horton comes into

your studio and he produces a show

right there in your studio every week,

Appendix 53

afforded the Executive Director is highlighted by contrast-

ing the hypothetical above with one presented to him later

during the TRO hearing:

Questior’ [Suppose] [h]e’s got a 30-minute show. He

comes so close. for 14 minutes he shows

free. He goes to Mississippi. He’s

over there visiting the headquarters

[of N-TV] and everything and the

poor fellow is in a car wreck and he

broke his leg and he calls you up and

says, “I can’t get back to Houston.

I’m going to have to shoot this from

the hospital bed in Jackson” and he

sends you the tape. Is he going to

have to pay for that?

Answer: Under the Current rules, that would

be the case.

Counsel: Would you waive that in this case?

Answer: Would I waive it?

Counsel: Yes

Answer: In the grievance procedure, I would

recommend that we waive it. I would

probably take it upon myself to waive

it.

Appendix 54

the Houston skyline. Would you let him

slide on that without having to pay?

Answer: Like I say, we would -- that would bea

good issue to discuss in the grievance pro-

cedure.

Question: You might let it slide?

Answer: Well, I don’t think I would let it slide. But

if it came up, I think it would be some-

thing worth discussing with the board.

Access’s response to this troubling amount of appar-

ently unguided discretion is that N-TV presented no actual

evidence that the fee had been discriminatorily imposed.

We agree that, in light of the express objectivity-of the

rule, a facial challenge based on standardless discretion

lacks merit. The rule, unlike the sliding-scale fee in

Forsyth, unequivocally identifies the programs to which it

applies and simply does not justify the latitude which the

Executive Director hypothesized. Further, lacking any

proof that the fee was ever administered discriminatorily to

suppress disfavored speech, N-TV’s as-applied challenge

must fail.

CONCLUSION

Much is uncertain about the scope of First Amendment

benefits and burdens in the cable industry. The directions

presently available to us from the Supreme Court appear to

require a standard less than that of strict scrutiny for Ac-

Appendix 55

cess’s non-locally-produced fee rule, but they also require

attention to the details of intermediate scrutiny. Regula-

tions like this one which burden protected speech are not

to be rubber-stamped. Based on the foregoing discussion,

the case must be reversed and remanded for further factual

development.

REVERSED and REMANDED.

Appendix 56

APPENDIX E

IN THE UNITED STATES DISTRICT COURT

FOR THE SOUTHERN DISTRICT OF TEXAS

HOUSTON DIVISION

ROBERT HORTON, BARRY HACKNEY,

and NATIONALIST TELEVISION,

a subsidiary of THE NATIONALIST

MOVEMENT, a Texas

Nonprofit Corporation,

Plaintiffs,

CITY OF HOUSTON, TEXAS,

a Texas municipal corporation,

and ACCESS HOUSTON

CABLE CORPORATION, a

Texas corporation,

Defendants.

CIVIL ACTION NO. H-92-3451

MEMORANDUM OPINION

In a previous order, the Court announced its intention

to grant summary judgment in favor of Plaintiffs Robert

dorton and Nationalist Television. (Docket entry #46).

Defendants, the City of Houston and Access Houston Ca-

Appendix 57

ble Corporation (“Access Houston”), have had the oppor-

tunity to respond. In this opinion, the Court first finds that

the City of Houston is not legally responsible for Access

Houston’s decision to impose fees and, therefore, is not

liable to Plaintiffs for any constitutional violation. Second,

the Court concludes that it cannot grant summary judgment

on either of the nonconstitutional grounds: (1) that the im-

position of mandatory fees was an ultra vires act, or (2)

that Access Houston violated the Cable Communications

Policy Act. Third, the Court is of the opinion that the Plain-

tiffs’ motion for summary judgment on First Amendment

grounds should be DENIED because the fee rule is content

neutral and survives a facial constitutional challenge under

intermediate scrutiny.

Finally, as the Court finds that there are no genuine

issues of material fact, the Court will GRANT Defendant

Access Houston’s motion for summary judgment.

1. Factual and Regulatory Background

Robert Horton is a Houston resident who seeks to

cablecast a half-hour weekly program called Airlink over

Houston cable television channels dedicated to “public,

educational, and governmental programming.” (“PEG chan-

nels”).! Defendant Access Houston is a corporation char-

' Barry Hackney was joined by Court order as an addi-

tional plaintiff on October 9, 1997. He, like Plaintiff Hor-

ton, is a member of the Nationalist Movement who seeks

the cablecast of Airlink.

Appendix 58

tered by Defendant City of Houston for the sole purpose of

operating the PEG, or “public access’ channels on all cable

systems in Houston. Airlink is produced in Mississippi by

Plaintiff Nationalist Television, a subsidiary of the Nation-

alist Movement.’ The content of the Airlink show is de-

scribed variously as “pro-majority” by Plaintiffs and

“white supremacist” elsewhere in the record. See, e. g.,

Dkt. #4, Ex. X. Plaintiffs allege that Defendants have vio-

lated their First Amendment right of free speech by charg-

ing them $100.00 per hour to cablecast programming pro-

duced outside the Houston Standard Metropolitan Statisti-

cal Area. (“SMSA”). Over the course of a calendar year,

this mandatory fee would require Nationalist Television to

pay roughly $2,600.00 to Access Houston to cablecast the

weekly Airlink show.

City of Houston Ordinance 93-156, the current fran-

chise agreement between the City of Houston and Warner

Cable Communications,’ describes in Exhibit B various

policies and procedures related to public access program-

niing on the Warner Cable system. One subsection of

Plaintiff Nationalist Television, a subsidiary of The

Nationalist Movement, a Texas nonprofit corporation, was

substituted by Court order on October 9, 1997 for the prior

Nationalist Television entity (a subsidiary of The Nation-

alist Movement, a Mississippi nonprofit corporation).

> Warner Cable is one of several franchisees authorized

by the City of Houston to cablecast programming to cable

subscribers.

Appendix 59

these Access Policies and Procedures specifies:

G. Production of programming by organizations

within the City of Houston will be encouraged.

Programming by organizations within the City

shall be given scheduling preference over pro-

grams produced outside the City.

In recognition that the Public, Educational,

and Government Access channels are primarily

intended to benefit the Houston community by

encouraging the production of programming that

has local significance, the majority (51% of total

hours available which shall be calculated by divid-

ing the total number of hours of local program-

ming on all Access Channels by the total number

of hours of programming), excluding character

generated programming, shall be produced by in-

dividuals, institutions or organizations from within

the City of Houston. An exception may be made

for Educational programming that meets commu-

nity needs and that is not available from local pro-

ducers if such programming is pre-approved and

submitted by a local institution or organization.

Such exceptions may not be made for more than

5% of total hours available as calculated above.

Similarly, the 1994 contract between the City of Hous-

ton and Access Houston contains the following require-

ments:

2.03. Local Programming. (a) By the end of the q |

Appendix 60

first Contract Year, and for all succeeding Con-

tract Years, Access Houston shall cablecast a min-

imum of 18 hours per day , of eligible program-

ming, excluding character-generated program-

ming. By the end of the second Contract Year,

and for all succeeding Contract Years, a minimum

of 51 percent of the total hours programmed on

the Access Channel shall be locally produced in

the Houston metropolitan area.

(b) Access Houston shall make available a mini-

mum of 61 hours per week of community interest

programming developed by community groups,

organizations, and other local institutions.

Policies and Procedures shall be established by

Access Houston which at a minimum should in-

clude the following: ...

7. Production of programming by organizations

within the City of Houston will be encouraged.

Programming within the City shall be given

scheduling preference over programs produced

outside the City.

The Plaintiffs do not challenge Houston’s strict PEG

local content requirements in any manner. Nor do Plain-

tiffs appear to object in principle to the notion that Houston

should have some policy to promote “localism,” ensuring

that a fair portion of PEG programming is produced locally

and responsive to local interests. Rather, Plaintiffs’ con-

Appendix 61

cern is with Access Houston Cable Corporation’s handling

of the forty-nine percent (49%) of programming which,

according to the Houston regulations, may be produced

either in Houston or elsewhere.’ Plaintiffs’ concern is that

while Access Houston will cablecast all locally produced

programming without charge (so long as the programming

satisfies certain technical requirements for compatibility

with cable transmission systems, it is not obscene, libelous

or otherwise illegal, and it meets certain other criteria

spelled out in the Houston franchise agreements), all

non-local programming, however, may be cablecast ifand

only if the individual or organization seeking to air the pro-

gramming pays an hourly fee.

The fee for non-local programming is not the only fee

that Access Houston charges. It is, however, the only man-

datory fee. Access Houston charges fees for training

classes, but these training fees and other fees are placed in

a fund “to provide training to those unable to pay for it.”

See Dkt. #47, Ex. E, atI 10. In contrast, the rule concern-

ing fees for non-local programming provides no procedure

for individuals and organizations without substantial re-

* In other words, the Houston rules establishing a mini-

mum local content requirement only establish a “floor” for

_ the amount of locally-produced programming that may be

cablecast; the rules do not represent a “ceiling.” That the

Houston PEG regulations permit the cablecast of non-local

programming at least some of the time indicates that “local-

ism” is not the exclusive goal of the PEG channels in

Houston.

Appendix 62

sources to apply for a waiver. Access Houston also

charges fees for the use of the resources it provides to indi-

viduals and organizations for the production of PEG pro-

gramming (studio and editing facilities, video cameras, and

the like); however, some of the time, these resources are

reserved for use without charge on a first-come,

first-served basis. The reason fees are imposed at other

times, Access Houston explains in its regulations, is that

demand for free access to production facilities far exceeds

the supply. Therefore, the usage fees for production re-

sources, which are still well below market rates for similar

facilities and equipment, only ensure preferential access to

these resources; the fees are not an absolute precondition

to the use of Access Houston’s production resources.

Neither the Houston cable franchise agreements, nor

any contract between the City of Houston and Access

Houston, nor the Access Houston bylaws or articles of

incorporation requires Access Houston tO impose manda-

tory fees on non-local programming. The mandatory fees

are solely the product of a resolution by the Access Hous-

ton Board of Directors. The Access Houston Board of

Directors claims, however, that the City of Houston has

impliedly authorized Access to impose mandatory access

fees on non-local programming. Such authorization must

be implied because there appears to be no express authori-

zation by the city to charge a “fee” of any nature.

Access Houston’s Board of Directors believes that the

power to impose such a fee, and to withhold airtime as a

means of coercing payment, is implicit in its power to pro-

mulgate rules and regulations. The 1994 contract between

Appendix 63

Access and the City provides:

2.04 Policies and procedures. In connection with

the performance of its obligations hereunder, Ac-

cess Houston shall establish, implement and en-

force quality control and other procedures for pro-

gramming consistent with the Policies and Proce- q

dures contained in Exhibit A hereto. Public Ac- 4

cess Programming must be consistent with the j

goals, objectives, and the scope of services stated

in this Contract throughout the Contract Term

(italics added). Exhibit A to the contract says nothing

about user fees; concerning non-local programming, Ex-

hibit A only specifies that local’ programming shall be

given preferential scheduling. Likewise, the Access Hous-

ton Bylaws specify in Article III:

Access Houston is organized to coordinate, de-

velop and administer all public access activities

for access to those cable channels available to the

City of Houston for access activities as a result of

its cable franchise agreements and not reserved by

the City of Houston for municipal access activi-

ties. Access Houston .. . shall act as public

trustee in the administration of this public re-

source in the community interest. In order to ac-

complish this purpose, Access Houston shall:

>. Establish and administer, under the juris-

—

Appendix 64

diction of the Board of Directors of Access

Houston, all rules, regulations, policies

and operating procedures, including train-

ing requirements, pertaining to the use and

scheduling of these cable access channels;

The Bylaws also specify in Article V, Section 3 that the

Board of Directors shall “[s]et policies for the operation of

Access Houston and establish its general course from year

to year in accordance with the purposes as outlined in Arti-

cle III.”

Also in Article III of Access Houston’s Bylaws, Access

Houston is authorized to “hire and supervise staff,” “pur-

chase materials and equipment, and supervise staff,” “pur-

chase materials and equipment,” “establish, manage and

operate cable access facilities, including a means of pro-

duction and a means of delivery of programming to the

cable system(s),” and to “provide ... the resources® to pro

> The 1994 contract also requires “at a minimum,” for

the purpose of development and implementation of public

participation, that Access Houston “[p]rovid[e] to local

individuals, institutions and Organizations, on a

non-discriminatory basis, the necessary resources to pro-

duce public access programs. This includes facilities, ma-

terials, equipment and personnel.” The power to condition

cablecast of programming upon the payment of mandatory

fees is no more implicit in the requirement to “provide re-

sources” to the community for video production than it is

Appendix 65

duce programming for the cable access channels to indi-

viduals, institutions, and organizations within the city of

Houston on a non-discriminatory basis.”

The Bylaws do not require that Access Houston limit

itself to franchise fees as its sole funding source; rather, the

Bylaws specify:

In addition to the monies received by Access

Houston from the City of Houston, the Board of

Directors may seek and receive private, federal,

state, county and other municipal funds for the

purpose of developing and promoting cable televi-

sion programming of a public and educational na-

ture for the principal benefit of the citizens of

Houston. The Board of Directors of Access Hous-

ton may also accept on behalf of Access Houston

any contribution, gift bequest or other devise for

general purpose(s) or for any special purpose(s) of

Access Houston.

As the City points out in its briefing, the 1994 contract

between the City and Access in section 2.01(v) requires

Access to “[mJake diligent efforts to secure outside fund-

ing, including soliciting contributions, to augment Public

Access Payments, including without limitation solicitation

of public membership subscriptions.” The 1993 Warner

Cable franchise agreement also specifies that Access

implicit in te power to “purchase materials and equip-

ment” or to ‘hire and supervise staff.”

Appendix 66

Houston may use airtime for the purpose of conducting

fundraising drives, presumably by soliciting PEG member-

ship subscriptions from cable customers. While all of

these documents expressly contemplate Access Houston

conducting fundraising activities through the solicitation of

voluntary contributions, none of them contain any authori-

zation to condition cablecast of programming on the pay-

ment of mandatory user fees.

At the time this lawsuit commenced, the question con-

cerning the propriety of the Access Houston fee for

non-local programming was relatively easy to resolve. In

1979, Warner Cable entered into a franchise agreement

with the City of Houston for a term of fifteen years; this

agreement was adopted as a City of Houston ordinance.

Hence, Access Houston was required to abide by the terms

of the Warner Cable franchise agreement, if for no other

reason than the requirement in section 4.1.6 of the 1986

contract between Access Houston and the City that “[Ac-

cess Houston] shall comply with all laws, statutes, ordi-

nances, decrees, requirements, orders, judgments, and reg-

ulations of governmental authorities, to the fullest extent

possible where failure to do so might reasonably be ex-

pected to have an adverse material effect upon [Access

Houston], its properties, or its business activities.” With

regard to PEG channels, the 1979 Warner Cable contract

specified that “at least two channels shall be reserved for

the use of the public, one of which shall have nondiscrimi-

natory access without charge on a first come, fast serve[d]

basis, and the other of which shall be reserved for use by

the city.” :

Appendix 67

Therefore, when the City of Houston for-med Access

Houston in 1986, and passed Access Houston’s Bylaws as

a city ordinance, it would have been a violation of the

Warner Cable franchise agreement for the City to authorize

Access Houston to charge mandatory access fees to users

or to deny users cablecast access on the ground that they

had not paid a fee. Thus, in 1986, and in 1988 when Ac-

cess Houston implemented its mandatory fee, Access’s

decision represented a clear violation of the Warner Cable

franchise agreement.

However, the City of Houston renewed Warner Cable’s

franchise agreement in 1993. In lieu of the relative pith of

the 1979 franchise agreement on the subject of PEG chan-

nels, the 1993 franchise agreement contains six pages of

rules concerning what may be cablecast, what must be

cablecast, the technical requirements for programming, the

conditions and terms upon which PEG airtime is provided,

and prohibitions on the broadcast of certain forms of ille-

gal or unprotected speech. Unlike the 1979 agreement,

which provides that access to PEG airtime must be pro-

vided on a “nondiscriminatory . . . first come. first

serve[d]” basis, the 1993 franchise agreement expressly

requires discrimination in favor of locally produced pro-

gramming in allocating airtime. The 1993 franchise agree-

ment is absolutely silent on the question of whether access

to.PEG airtime must be provided “without charge,” or

whether charges may or must be imposed.

In response to the Court’s previous otder, both Access

Houston and the City of Houston have pointed out that the

Warner Cable franchise agreement no longer requires PEG

Appendix 68

airtime to be provided without charge on a nondiscrimina-

tory first-come, first-served basis. The Court expressly

contemplated this possibility in footnote four of its earlier

order. Because the franchise agreement has changed, the

Court can no longer rely on the franchise agreement as a

ground for deciding this case.

II. Analysis of Non-Constitutional Issues

The Court will address Plaintiffs’ non-constitutional

grounds for summary judgment first because, without ex-

ception, the federal courts must adhere to the rule that “if

a case can be decided on nonconstitutional grounds, it

Should be.” Ashwander v. Tennessee Valley Auth., 297

U.S. 288, 32647, 56 S. Ct. 466, 80 L. Ed. 688 (1936),

reh’g denied, 297 U.S. 728, 56 S. Ct. 588, 80 L. Ed. 1011

(1936). Therefore, until these threshold questions are re-

solved, the Court must not decide the issue of whether

Plaintiffs’ First Amendment rights have been violated by -

a facially invalid fee rule; nor may it consider whether

there is any evidence that the fee rule is unconstitutional as

applied.

A. Ultra Vires

The first question presented is whether the mandatory

fees Access Houston has imposed on non-local program-

ming are ultra vires -- in other words, beyond the power of

Access Houston. This analysis affects two determinations:

(1) whether the city can be liable to Plaintiffs for constitu-

tional violations resulting from the imposition of the fees

if it implicitly authorized such fees; and (2) whether Ac-

Appendix 69

cess Houston can be liable to Plaintiffs because of an ultra

vires decision to impose fees. From its analysis of this

issue, the Court concludes that (1) the City of Houston

never authorized Access Houston to charge such manda-

tory fees and, as such, cannot be held legally responsible

for any violation of Plaintiffs’ rights, and (2) even if Ac-

cess Houston’s decision to charge mandatory fees was an

ultra vires act, Plaintiff does not have standing to raise this

argument and, therefore, it cannot be dispositive of the

case.

1. The Issue of Implicit Authorization by the City

of Houston

It is at best ambiguous whether the City of Houston

intended the silence of the 1993 Warner Cable agreement

on the question of mandatory fees to serve as an indication

that Access Houston was thereby authorized to impose

them. In its briefing, the City of Houston takes no such

position. Only Access Houston contends that the City of

Houston has provided such authorization. Such an argu-

ment is roughly analogous to the rule applied by the federal

courts in interpreting statutes that, “(t]he silence of Con-

gress after consideration of a practice by the Executive

may be equivalent to acquiescence and consent that the

practice be continued until the power exercised be re-

voked,’ see Immigration & Naturalization Serv. v. Chadha,

462 US. 919, 975 n. 11, 103 S. Ct. 2764, 2796 n. 11, 7TL.

Ed. 2d 317 (1983) (White , J., dissenting) (and cases cited

therein), see also Babbitt v. Sweet Home Chapter of Com-

munities for a Great Oregon, 515 U.S. 687, 115 S. Ct.

2407 (1995), and is not without some ‘persuasive force.

Appendix 70

However, it has also long been recognized that “[{t]he si-

lence of Congress may provide a treacherous guide to its

intent.” Watt v. Alaska, 451 U.S. 259, 271 n.13. 101 S. Ct.

1673, 1680. 68 L. Ed 2d 80 (1981) (citing Scripps-Howard

Radic, Inc. v. F.C. C., 316 U.S. 4, 11, 62 S. Ct. 875, 880,

86 L. Ed. 2d 1229 (1942) (“The search for significance in

the silence of Congress is too often the pursuit of a mi-

rage.”’). Access Houston has not presented the Court with

any evidence that the City of Houston actually had the

non-local programming fee in mind when the City negoti-

ated the 1993 franchise renewal with Warner Cable.

Moreover, by the time the Warner Cable contract was ne-

gotiated, the City had appeared in this very litigation to

disavow that it had ever authorized Access Houston to

charge user fees:

[T]he record is clear that the fee complained of is

authorized by the rules of Access Houston, Inc.

itself . . . and are not due to any action of the City

of Houston .... Plaintiffs fail to allege any facts

showing that the City of Houston, rather than the

independent corporate entity known as Access

Houston, Inc., had any role whatever in promul-

gating, authorizing, or enforcing Access Hous-

ton’s fee requirement or other procedural rules in

any fashion, as to Plaintiffs or anyone else.

Defendant’s Motion to Dismiss (Nov. 30, 1992), Dkt. #8,

at 4 (emphasis added).

Access Houston relies primarily on language in its By-

laws permitting it to “seek and receive private, federal,

Appendix 71

state, county, and other municipal funds.’ However, the

issue in this case is not whether Access is authorized to

“receive private . . . funds.” Plainly, if the Nationalist

Movement were to donate money voluntarily to Access

Houston, then Access Houston could accept it. Rather,

Access Houston has attempted to withhold access to

cablecast facilities from Plaintiffs until they accede to its

demands. Therefore, the crucial issue, separate and apart

from authorization to accept money from users, is whether

Access Houston is authorized to impose this mandatory

condition for the cablecast of non-local programming. Ob-

viously, authorization to “receive private, federal, state,

county, and... municipal funds” does not authorize Access

Houston to withhold cablecast services in an effort to co-

erce additional appropriations from the state, local, or fed-

eral authorities. Likewise, this language standing alone

would not appear to authorize Access Houston to withhold

services in an effort to raise funds from private users.

Moreover, the Access Houston Bylaws have never been

changed since 1986, when any authorization to charge

mandatory access fees would have violated the franchise

agreement between the City of Houston and Warner Cable.

Considering the relevant factors, it appears that the City of

Houston never authorized Access Houston to charge man-

datory fees. Hence, only Access Houston can be held re-

sponsible for any violation of Plaintiffs’ constitutional

rights. See generally Hurley v. Irish-American Gay, Les-

bian & Bisexual Group of Boston, 515 U.S. 557, 1158S. Ct.

2338 (1995) (parade organizer’s actions in excluding par-

ticular groups from marching in parade are not attributable

to City, which authorized organizer to conduct the parade).

Appendix 72

2. A Determination that Access Houston’s imposi-

tion of Mandatory fees was an Ultra Vires Act is not

Dispositive of this Case

Nevertheless, further examination of relevant state law

leads the Court to conclude that it cannot decide the case

as to Access Houston on the basis of Access Houston’s

potentially u/tra vires act. Neither Plaintiff has standing to

challenge the actions of Access Houston as ultra vires be-

cause of the Texas Non-Profit Corporation Act. According

to Tex. Rev. Civ. Stat. Ann. .art. 1396-2.03 (Vernon

1980), “Lack of capacity ofa [non-profit] corporation shall

never be made the basis of a claim or defense at law or in

equity.” Article 1396-2.03(B) specifies only three narrow

categories of persons with standing to object to a

non-profit corporation’s actions on ultra vires grounds.

Plaintiffs do not fall within any of those three categories.

B. Statutory Violations

Plaintiffs also contend that Access Houston has at-

tempted to exercise “editorial control” over the PEG chan-

nels, in violation of section 531(e) of the Cable Communi-

cations Policy Act. As mentioned in the Court’s earlier

order, Dkt. #46, at 2, 5 & n.3, this prohibition only applies

to Access Houston if it is a “cable operator,” as defined in

the Act. Access Houston does not fall within the definition

of “cable operator.” See 47 U.S.C. § 522(5), (6)(A).

Therefore, the Court must reach the constitutional argu-

ments that Plaintiffs have raised.

Appendix 73

Ill. Analysis of Constitutional Issues

_ A, State Action

Plaintiffs’ claims for relief based on constitutional vio-

lations are stated under 42 U.S.C. § 1983:

Every person who, under color of any statute, or-

dinance, regulation, custom, or usage of any State

or Territory . . . subjects, or causes to be sub-

jected, any citizen of the United States or other

person within the jurisdiction thereof to the depri-

vation of any rights, privileges, or immunities

secured by the Constitution and laws, shall be lia-

ble to the party injured in an action at law, suit in

equity, or other proper proceeding for redress.

The threshold question, therefore, is whether Access

Houston is a “state actor” that can deprive Plaintiffs of

their constitutional rights under color of law. The Constitu-

tion’s protections of individual liberty “apply in general

only to action by the government;” this “fundamental limi-

tation on the scope of constitutional guarantees . . .avoids

imposing on the State, its agencies or Officials, responsibil-

ity for conduct for which they cannot fairly be blamed.”

Edmonson v. Leesville Concrete Co., 500 U.S. 614, 619,

111 S. Ct. 2077, 2082, 114 L. Ed,2d 660 (1991); cf. Wyatt

v. Cole, 504 U.S. 158, 162-64, 168-69. 112 S. Ct. 1827,

1830-31, 1834, 118 L. Ed. 2d 504 (1992) (private entities

are subject to 42 U.S.C. § 1983 liability for invoking un-

constitutional state law replevin or attachment procedures,

but unlike government officials, have no qualified immu-

Appendix 74

nity defense).

The Court finds that Access Houston is a state actor

because (1) it is not a purely private entity as (a) it is a

channel for communication which is open to the public and

specially dedicated as a forum for expressive activity and

(b) supervision over day-to-day operations has been trans-

ferred from a private owner to a government entity; and (2)

Access Houston meets the qualifications for a non-profit

corporation to be considered part of the government for

constitutional purposes.

First, Access Houston has not shown that it is a purely

private entity. If Access Houston is purely private, then it

cannot violate Plaintiffs’ First Amendment expressive

rights any more than could the private shopping centers in

Pruneyard Shopping Ctr. v. Robbins, 447 U.S. 74, 80-82,

84-85, 100 S. Ct. 2035, 2040-41, 2042, 64 L. Ed. 2d 741

(1980) (protesters’ exercise at shopping center of expres-

sive rights under state constitution -- which provides

greater protection than federal constitution -- does not con-

stitute compensable “taking” of shopping center owner’s

property), and Lloyd Corp. v. Tanner, 407 U.S. 551,

567-70, 92 S. Ct. 2219, 2228-29, 33 L. Ed. 2d 131 (1972)

(private shopping center is not a public expressive forum

for First Amendment purposes). Purely private entities, by

forbidding visitors from engaging in certain expressive

activities, will violate individuals’ expressive ri ghts only in

limited circumstances. See, for example, Marsh v. Ala-

bama, 326 U.S. 501 (1946) (where company owned town

and that private actor took the place of local government,

the private actor engaged in “state action”). However, the

Appendix 75

present dispute involves access to private property® for

expressive purposes only in the sense that the cable infra-

structure in Houston has been constructed and is operated

by private franchisees such as Warner Cable. While an

entire cable system may have characteristics of private

ownership, which make it roughly analogous to a private

shopping center, cf Turner Broadcasting Sys., Inc. v. Fed-

eral Communications Comm'n, 512 U.S. 622, 1148S. Ct.

2445, 2464-66, 2469-70, 129 L. Ed. 2d 497 (1994) (ad-

dressing argument that “must-carry” rule, requiring cable

operators to transmit a specified number of broadcast sta-

tions, is subject to the strictest constitutional scrutiny be-

6 But cf. Turner Broadcasting Sys., Inc. v. FCC, 512

US. _,__, 1148. Ct. 2445, 2451-52, 129 L. Ed. 2d

497, 62 U.S.L.W. 4647 (1994) (“Cable systems, by con-

trast [to broadcast stations] rely upon a physical,

point-to-point connection between a transmission facility

and the television sets of individual subscribers. Cable

systems make this connection much like telephone compa-

nies, using cables or optical fibers strung aboveground or

buried in ducts to reach the homes or businesses of sub-

scribers. The construction of this physical infrastructure

- entails the use of public rights-of-way and easements and

often results in the disruption of traffic on streets and other

public property. Asa result, the cable medium may depend

on its very existence upon express permission from local

governing authorities. See generally Community Com-

munications Co. v. Boulder, 660 F.2d 1370, 1377-78 (10th

Cir. 1981).’), reh’g denied, __ U.S. ___, 115 S. Ce Me,

129 L. Ed. 2d 297 (1994).

Ea LULU

Appendix 76

cause it forces cable operators to utilize their private prop-

erty to transmit speech not of their choosing) (citing, inter

alia, Pruneyard Shopping Ctr. v. Robbins, 447 US. at 87,

100 S. Ct. at 2044 (1994)): id. at 2480 (O’Connor, J.,

joined by Scalia, Ginsburg, and Thomas, JJ., concurring in

part and dissenting in part) (citing same), the PEG chan-

nels bear dramatically less resemblance to the private shop-

ping center in Lloyd Corp., than they do to the public side-

walk easement’ where the Vietnam War protesters were

required to conduct their leafleting after being required to

leave the interior malls. See Lloyd Corp., 407 U.S. at

566-67, 92 S. Ct. at 2228.

Specifically, the PEG channels resemble public side-

walk easements at an otherwise private commercial site,

and thus, are not purely private entities because (1) the

Cf. Dolan V. CityofTigard, US.__, _ 1148.

Ct. 2309, 2313-15, 2321-22, 129 L. Ed. 2d 304, 62

U.S.L.W. 4576 (1994) (addressing, for purposes of the

Takings Clause of the Fifth Amendment, a City Planning

~ Commission decision requiring a property owner, as a con-

dition for permission to redevelop her land, to dedicate all

land lying within a 100-year floodplain to municipality for

uS€ as a greenway, and an additional fifteen feet of land for

use as a pedestrian/bicycle pathway); Nollan v. California

Coastal Comm’n, 483 U.S. 825, 828, 107 S. Ct. 3141 ‘

3144, 97 L. Ed. 2d 677 (1987) (regulatory demand for a

lateral public easement across a beachfront lot in exchange

for a permit to demolish a beach house and build a larger

one).

Appendix 77

channel or easement is open to the public,® see Richmond

Newspapers, Inc. v. Virginia, 448 U.S. 555, 577- 78, 100

S Ct. 2814, 2827-28, 65 L. Ed. 2d 973 (1980) (“People

assemble in public places not only to speak or to take ac-

tion, but also to listen, observe, and learn; ... subject to the

traditional time, place, and manner restrictions . . . Streets,

sidewalks, and parks are places traditionally open, where

First Amendment rights may be exercised .... “) (citations

omitted); 47 U.S.C. § 531(a), (b), (e); (2) the channel or

easement is either specially dedicated or traditionally un-

derstood to be a forum for expressive activity, id.; see also

International Soc’y for Krishna Consciousness Vv. Lee, 505

U.S. 672, 678, 112 S. Ct. 2701, 2705-06, 120 L. Ed. 2d

541 (1991), and (3) supervision and control over the

day-to-day operation of the easement or channel has been

transferred from the private owner to 4 government entity.

See 47 U.S.C. § 531(b), (d), (€) CA franchising authority

may . . . require as part of a franchise, and may require as

a part of a cable operator’s proposal for a franchise re-

newal .. . that channel capacity be designated for public,

educational, or governmental use... and may require rules

and procedures for the use of the channel capacity desig-

nated pursuant to this section. .. [A] cable operator shall

not exercise any editorial control over any public, educa-

8 Although the PEG channels are open for the public to

view programming only in the sense that all cable subscrib-

ers have access to them, by every indication in the record,

cablecast services are available to the entire community

without regard to whether a person or group in fact sub-

scribes to cable.

Appendix 78

tional, or governmental use of channel capacity... .”). It

is pursuant to the federal statutory authorization quoted

above, 47 U.S.C. § 531(a), (b), that the City of Houston

has made the dedication of specified channel capacity to

PEG programming a mandatory precondition for any cable

franchise or franchise renewal.

Although the franchise agreements place control over

the PEG channels in the hands of the franchisor, the City

of Houston, see, e.g., City of Houston Ordinance No.

93-156, § 11 (1993 Warner Cable franchise agreement),

the City has elected not to retain day-to-day control over

the operation of the PEG channels. Rather, it has assigned

operation and management of the access channels to Ac-

cess Houston, @ nonprofit corporation created solely for

1.01, 2.01(1) (contract between the City ci Houston and

Access Houston). Additionally, every quarter the City

transfers a substantial portion of the cable franchise fees it

receives to Access Houston for the purpose of funding Ac-

cess’s operating budget. /d. §§ 3.01-3.02. All members of

the Access Houston Board of Directors are “nominated by

the Mayor of the City of Houston and confirmed by the

City Council of the City of Houston.” City of Houston Or-

dinance 86-1733, art. VI, § 6 (Access Houston Bylaws).

Second, the mere fact that Access Houston is a non-

profit corporation, as opposed to a department of city gov-

ernment, does not preclude the possibility that it is a state

actor for First Amendment purposes. In Lebron v. Na-

tional R.R. Passenger Corp., the Supreme Court held that

the National Railroad Passenger Corporation, or Amtrak,

Appendix 79

which was established by Congress and incorporated “‘as a

for profit corporation” under the District of Columbia

Business Corporation Act, “is an agency or instrumentality

of the United States for the purpose of individual rights

guaranteed against the Government by the Constitution,”

even though its authorizing statute declared that Amtrak

“will not be an agency or establishment of the United

States Government.” 513 U.S. 374, 115 S. Ct. 961, 970-74

(1995). The Court held that where “the Government cre-

ates a corporation by special law, for the furtherance of

governmental objectives, and retains for itself permanent

authority to appoint a majority of the directors of that cor-

poration, the corporation is part of the Government for

purposes of the First Amendment. ...” /d. at 971, 973.

For constitutional purposes, Access Houston, which is a

nonprofit corporation created by city ordinance, solely for

the purpose of advancing local, and other, governmental

objectives, and which is controlled by a board whose mem-

bers are all appointed by the Mayor of Houston and ap-

proved by the City Council, is not distinguishable from

Amtrak in any material way. Therefore, the Court finds

that Access Houston is a state actor for constitutional pur-

poses.”

9 It should be noted that because Access Houston is a

state actor which operates an expressive outlet available to

the general public, its exclusion of particular speakers or

viewpoints from that expressive outlet cannot be justified

on the ground that the exclusion is itself a protected First

Amendment expressive activity. See Hurley v. Irish-Amer-

ican Gay, Lesbian & Bisexual Group of Boston, 515 U.S.

Appendix 80

Appenuir ou

B. Summary Judgment Standard

Summary judgment may be entered if the pleadings and

evidence on file “show that there is no genuine issue as to

any material fact and that the moving party is entitled to

judgment as a matter of law.” Fed. R. Civ. P. 56(c). The

movant bears the initial burden of informing the court of

the basis for its motion, and of identifying those portions

of the record which demonstrate the absence of a genuine

issue of material fact. Celotex Corp. v. Catrett, 477 U.S.

317, 323, 106 S. Ct. 2548, 25 53, 91 L. Ed. 2d 265 (1986):

Wallace v. Texas Tech Univ., 80 F.3 d 1042, 1046-47 (Sth

Cir. 1996). When the movant is the defendant, it may rely

on the absence of evidence to support an essential element

of the plaintiffs case. Celotex, 477 U.S. at 323-24, 106 S.

Ct. at 2553; Duffy v. Leading Edge Prods., Inc., 44 F.3d

308, 312 (Sth Cir. 1995). If the movant carries its burden,

the nonmovant must then designate specific facts showing

a genuine issue for trial. Wallace, 80 F. 3d at 1047; Little

v. Liquid Air Corp., 37 F. 3d 1069, 1075 (Sth Cir. 1994).

C. Analysis of First Amendment Issues

1. Forsyth County, Ga. v. The Nationalist Movement

557, 115 S. Ct. 2338 (1995) (Supreme Court not presented

with question of whether ‘state action’ nexus is satisfied by

city-authorized parade sponsor’s exclusion of contingent

from parade due to contingent’s expressive message, and

therefore defers to determination below that the sponsor’s

actions represent purely “private conduct’).

Appendix 81

Plaintiffs argue that Defendants have violated their

First Amendment expressive rights by charging them a fee

because Airlink is produced “elsewhere” than in the Hous-

ton SMSA. In supporting their facial challenge to the man-

datory fee rule, Plaintiffs primarily rely upon Forsyth

County, Ga. v. The Nationalist Movement, 505 U.S. 123,

112 S. Ct. 2395, 120 L. Ed. 2d 101 (1992), although they

cite other authority in a seemingly scatter-gun fashion. Not

surprisingly, Plaintiffs counsel represented the Nationalist

Movement in the Forsyth County case, and he now at-

tempts to cast this dispute in a Forsyth County mold.

However, what the Supreme Court found objectionable in

Forsyth County was the arbitrary discretion that a parade

permit fee rule placed in the hands of a county administra-

tor. See id. at 133-34, 112 S. Ct. at 2401, 2403-04. In

Forsyth County, the challenged ordinance granted a county

administrator authority to set the amount of a parade fee

anywhere between one dollar and $1000.00, see id. at 126,

112 S. Ct. at 2399, and permitted the administrator to “ad-

just the amount . . . in order to meet the expense incident

to the administration of the Ordinance and to the mainte-

nance of public order . . . .” /d. at 126, 132-33, 112 S. Ct.

at 2399, 2402. Thus, the Court was concerned that the

ordinance would often require that the fee be based on the

content of the speech. See id. at 126, 112 S. Ct. at

2398-99, 2402-04 (noting that the ordinance itself was

passed “as a direct result” of two civil rights marches in

Forsyth County, the first of which ended when members of

a Nationalist Movement affiliate and the Ku Klux Klan

threw rocks and beer bottles at the marchers, the second of

which occurred the following weekend and became “the

largest civil rights demonstration in the South since the

Appendix 82

1960s”’).

Although Plaintiffs strive to identify as many hypotheti-

cal borderline cases as possible in an effort to demonstrate

that Access Houston administrators exercise some discre-

tion in administering the fee rule for non-local program-

ming, See Dkt. #16, the Access Houston fee does not vest

any administrator with such discretion that a F orsyth

County facial challenge would require Access Houston’s

fee to be held invalid. “In evaluating [a] facial challenge,

[the Court] must consider the [government entity’s] author-

itative constructions of [its own rule], including its own

implementation and interpretation of it.” /d. at 131, 112 S.

Ct. at 2402 (citing authorities). In the present case, Access

Houston has specified that it defines “produced elsewhere”

to mean that 50 percent or more of the footage to be shown

was shot outside the greater Houston SMSA. Hence, Ac-

cess has established a clear line to guide whatever discre-

tion an administrator might exercise. Moreover, the ad-

ministrator has no discretion to set the amount of the fee;

the amount is fixed and depends solely on two rather

clear-cut determinations -- whether an individual or a

group has submitted a program, and where the program

was produced. Hence, the Access Houston fee rule does

not raise any of the potential censorship concerns associ-

ated with the Forsyth County parade fee.

Plaintiffs, of course, contend that no matter how clear

Access Houston’s policy may appear on paper, in actual

practice Access Houston applies it ina discriminatory and

constitutionally impermissible manner. However, such an

argument has no place in a facial challenge to the Access

Appendix 83

fee rule.

2. The Content Neutrality of the Fee Rule and the

O’Brien Standard of Review

The threshold question in analyzing the constitutional-

ity of this rule is to determine, under applicable First

Amendment precedent, what standard of review to apply.

In Turner Broadcasting v. F. C. C., the Supreme Court

analyzed a “must carry” rule, which required cable opera-

tors to transmit a specified number of local commercial

and public broadcast stations, and determined that such a

content-neutral regulation is subject to the O ‘Brien inter-

mediate level of scrutiny applicable to content-neutral re-

strictions that impose an incidental burden on speech. See

Turner Broadcasting, 512 U.S. 622, 662, | 14S. Ct. 2445,

2469-72 (1994). Under O’Brien, a content-neutral regula-

tion will be sustained “{1] if it furthers an important or

substantial governmental interest; [2] if the governmental

interest is unrelated to the suppression of free expression;

and [3] if the incidental restriction on alleged First Amend-

ment freedoms is no greater than is essential to that inter-

est.” Id. (quoting O’Brien, 391 U.S. at 377, 88 S. Ct. at

1679). The Court determined that the “must carry” rules

were content-neutral for three reasons: (1) “[t]he rules im-

pose obligations on all operators [and] . . . [nJothing in the

act imposes a restriction, penalty, or burden by reason of

the views, programs, or stations the cable operator has se-

lected or will select’; (2), while “(t]he must-carry provi-

sions also burden cable programmers by reducing the num-

ber of channels for which they can compete . . . this burden

is unrelated to content, for it extends to all cable program-

Appendix 84

mers irrespective of the programming they choose to offer

viewers”; and (3) “the privileges conferred by the

must-carry rules are also unrelated to content.”

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