Logansport Broadcasting Corp. v. United States, 11601.

• Decision Date: 28 January 1954
• Docket Number: No. 11601.,11601.
• Citation: 210 F.2d 24
• Parties: LOGANSPORT BROADCASTING CORP. v. UNITED STATES et al.
• Court: U.S. Court of Appeals — District of Columbia Circuit

210 F.2d 24 (1954)

LOGANSPORT BROADCASTING CORP. v. UNITED STATES et al.

No. 11601.

United States Court of Appeals District of Columbia Circuit.

Argued October 14, 1953.

Decided January 28, 1954.

Mr. Robert M. Booth, Jr., Washington, D. C., with whom Mr. Herbert M. Bingham, Washington, D. C., was on the brief, for petitioner.

Mr. J. Roger Wollenberg, Asst. Gen. Counsel, Federal Communications Commission, Washington, D. C., with whom Mr. Richard A. Solomon, Acting General Counsel, Federal Communications Commission, Washington, D. C., was on the brief, for respondent and intervenor Federal Communications Commission. Mr. Charles H. Weston, Chief, Appellate Section of the Antitrust Division, Department of Justice, Washington, D. C., also entered an appearance for respondent. Miss Mary Jane Morris, Attorney, Federal Communications Commission, Washington, D. C., also entered an appearance for intervenor Federal Communications Commission. Mr. Benedict P. Cottone, General Counsel, Federal Communications Commission, Washington, D. C., at time record was filed, also entered an appearance for intervenor Federal Communications Commission.

Mr. Andrew G. Haley, Washington, D. C., with whom Messrs. Dwight D. Doty, Howard J. Schellenberg, Jr., and Mrs. Lenore G. Ehrig, Washington, D. C., were on the brief, for intervenor Wabash Valley Broadcasting Corp.

Mr. A. L. Stein, Washington, D. C., entered an appearance for intervenor Sarkes Tarzian, Inc.

Before PRETTYMAN, FAHY and WASHINGTON, Circuit Judges.

WASHINGTON, Circuit Judge.

Logansport Broadcasting Corporation, petitioner, complains of the action of the Federal Communications Commission in assigning VHF (very high frequency) television Channel 10 to Terre Haute, Indiana, rather than to Logansport, Indiana, and Owensboro, Kentucky. The latter cities were granted UHF (ultra high frequency) channels.¹

Petitioner's principal attack is against the Commission's nation-wide system for allocating television frequencies, finally adopted in 1952 after elaborate and detailed hearings on the subject.² The Commission says that it sought to distribute the available channels so as to achieve maximum television coverage with a minimum of interference between stations, and to that end assigned a television channel or channels to each of over 1,000 cities and towns throughout the nation. Thus, frequencies were allocated among communities on the basis of one master plan — arrived at through one master hearing. This replaced the system, used in the distribution of AM radio frequencies, of making assignments only on the basis of individual applications.³ Under the Commission's present plan the actual assignment of television channels to operators is by application, but all applications for licenses not conforming to the over-all plan are automatically dismissed. Proposals for changes in the allocation plan are considered by the Commission, but only in accordance with the usual procedure for effecting changes in Commission regulations.

Peoples Broadcasting Co. v. United States, recently decided by this court, held that the Commission had power to adopt its new plan. 1953, 93 U.S. App.D.C. —, 209 F.2d 286. Petitioner, however, requests us to reconsider the point, urging that it was not fully argued in the Peoples case or necessary to that decision. Perhaps the Peoples case could have been decided on a different ground — but it was not. This court in a carefully-considered and well-reasoned opinion specifically held that "The Commission had authority to adopt a nationwide television allocation plan. The purposes of the creation of the Commission, as expressed by Congress, and the mandates pursuant to the purposes, enumerated at great length in the statute, furnish ample support for this action." 1953, ___ U.S.App.D.C. at page ___, 209 F.2d at page 287. After considering petitioner's arguments, we have again come to the conclusion expressed in the Peoples case.

Petitioner's main reliance is on Section 307(b) of the Federal Communications Act which, it says, requires that frequencies be assigned only upon the receipt of specific applications therefor. Section 307(b) provides: "In considering applications for licenses, and modifications and renewals thereof, when and insofar as there is demand for the same, the Commission shall make such distribution of licenses, frequencies, hours of operation, and of power among the several States and communities as to provide a fair, efficient, and equitable distribution of radio service to each of the same." 48 Stat. 1083, as amended, 49 Stat. 1475, 47 U.S.C.A. § 307(b). Power is thus conferred to distribute frequencies in response to individual applications. Of course, the Commission under its new plan grants a television license only upon application therefor: if there is no application, no license issues. The question is: Can the Commission define in advance the conditions upon which licenses will issue, and define them so as to confine all applicants in a given community to a specified frequency or frequencies?

Section 307(b) must be read in the light of Section 303 of the Act, which gives the Commission the power to:

"(d) Determine the location of classes of stations or individual stations;

* * * * * "(f) Make such regulations not inconsistent with law as it may deem necessary to prevent interference between stations and to carry out the provisions of this Act * * *;

* * * * *

"(r) Make such rules and regulations and prescribe such restrictions and conditions, not inconsistent with law, as may be necessary to carry out the provisions of this act * * *." 48 Stat. 1082, 47 U.S. C.A. § 303.

The fair interpretation of Sections 303 and 307(b), when read together, is that the Commission may allocate channels among communities either by passing upon specific applications or by way of rule making. Situations are not infrequent in which an administrative agency can properly proceed either through rule making or adjudication: in such a case, the choice "is one that lies primarily in the informed discretion of the administrative agency." Securities and Exchange Commission v. Chenery Corporation, 1947, 332 U.S. 194, 203, 67 S.Ct. 1575, 1580, 1760, 91 L.Ed. 1995. After its experience in distributing FM radio frequencies pursuant to an allocation plan, and distributing AM frequencies in response to specific applications, the Commission has decided that by means of an allocation plan a more equitable distribution of television channels can be effected. We do not think this was an abuse of discretion. We again sustain the Commission's present plan of allocation.

Petitioner also attacks the instant proceeding on the somewhat inconsistent ground that it was essentially adjudicatory and that, as a result, formal findings and conclusions were necessary.⁴ The Sixth Report and Order, however, allocated television channels to communities throughout the entire country. On the basis of that general plan individual applications were to be adjudicated. To be sure the overall plan would vitally affect later individual adjudications. But rule making is not transformed into adjudication merely because the rule adopted may be determinative of specific situations arising in the future. See American Broadcasting Co. v. United States, D.C.S.D.N.Y.1953, 110 F.Supp. 374. A "rule" is defined in Section 2(c) of the Administrative Procedure Act⁵ as: "* * * the whole or any part of any agency statement of general or particular applicability and future effect designed to implement, interpret, or prescribe law or policy * * *." (Emphasis added.) Clearly, the instant plan had a future rather than a present or past effect.

Petitioner further objects to the procedure followed by the Commission in its rule making. It contends that Section 4(b) of the Administrative Procedure Act requires the Commission, at the conclusion of a rule making proceeding, to issue a statement demonstrating that it has considered all relevant evidence presented to it. It argues that the Commission's Final Report and Order did not...