Indiana Broadcasting Corporation (WANE-TV) v. FCC, 20833

• Citation: 407 F.2d 681
• Decision Date: 05 December 1968
• Docket Number: 20990.,No. 20833,20833
• Parties: INDIANA BROADCASTING CORPORATION (WANE-TV), Petitioner, v. FEDERAL COMMUNICATIONS COMMISSION, and United States of America, Respondents, G T & E Communications Inc., Intervenor. INDIANA BROADCASTING CORPORATION (WANE-TV), Petitioner, v. FEDERAL COMMUNICATIONS COMMISSION, and United States of America, Respondents, Shardco Cablevision, Inc., Intervenor.
• Court: United States Courts of Appeals. United States Court of Appeals (District of Columbia)

407 F.2d 681 (1968)

INDIANA BROADCASTING CORPORATION (WANE-TV), Petitioner, v. FEDERAL COMMUNICATIONS COMMISSION, and United States of America, Respondents, G T & E Communications Inc., Intervenor.

INDIANA BROADCASTING CORPORATION (WANE-TV), Petitioner, v. FEDERAL COMMUNICATIONS COMMISSION, and United States of America, Respondents, Shardco Cablevision, Inc., Intervenor.

Nos. 20833, 20990.

United States Court of Appeals District of Columbia Circuit.

Argued October 9, 1967.

Decided December 5, 1968.

Mr. Ernest W. Jennes, Washington, D. C., with whom Mr. Robert J. Muth, Washington, D. C., was on the brief, for petitioner.

Mr. Robert D. Hadl, Counsel, Federal Communications Commission, with whom Asst. Atty. Gen. Donald F. Turner, Messrs. Henry Geller, General Counsel, and John H. Conlin, Associate General Counsel, Mrs. Lenore G. Ehrig, Counsel, Federal Communications Commission, and Mr. Howard E. Shapiro, Atty., Department of Justice, were on the brief, for respondents. Mr. William L. Fishman, Counsel, Federal Communications Commission, also entered an appearance for respondent Federal Communications Commission in No. 20,833.

Mr. David H. Lloyd, Washington, D C., with whom Mr. Reed Miller, Washington, D. C., was on the brief, for intervenor in No. 20,833. Mr. Paul A. Porter, Washington, D. C., also entered an appearance for intervenor in No. 20,833.

Messrs. John D. Matthews and Daniel M. Redmond, Washington, D. C., entered appearances for intervenor in No. 20,990.

Before FAHY, Senior Circuit Judge, and BURGER and ROBINSON, Circuit Judges.

SPOTTSWOOD W. ROBINSON, III, Circuit Judge:

Petitioner, Indiana Broadcasting Corporation, the licensee of WANE-TV, a Fort Wayne, Indiana, UHF television station, seeks review of two memorandum opinions and orders of the Federal Communications Commission¹ denying petitioner's requests for an evidentiary hearing on proposals by GT&E Communications, Inc. (GT&E) and Shardco Cablevision, Inc. (Shardco), the intervenors here, to carry distant signals² on community antenna television (CA TV) systems³ in two localities lying between petitioner's Grade A and Grade B contours.⁴ The controversy arose when GT&E and Shardco gave notification of their intention to operate CATV systems⁵ in Angola, Indiana, and Delphos, Ohio, respectively, and petitioner resisted importation of distant signals on those systems. The proceedings before the Commission culminated in grants to GT&E and Shardco, by the orders under review, of the authority sought.

The Commission's distant signal rule prohibits a CATV system from distributing distant signals within the predicted Grade A contour of a station in the Nation's 100 largest television markets save upon a determination that their introduction will be "consistent with the public interest, and specifically the establishment and healthy maintenance of television broadcast service in the area."⁶ For purposes related to adjudication on that score, "a full evidentiary hearing," unless waived,⁷ is required.⁸ In all other instances, however, the regulations forbid a CATV extension of distant signals only if the Commission finds that the projection will be inconsistent with those criteria, and invoke the Commission's discretion as to whether, on its own motion or on petition by an interested party, a hearing on the matter is to be conducted.⁹

Fort Wayne has a population¹⁰ of 161,776.¹¹ It is the 96th largest television market in the country. The Commission has assigned five channels, all UHF, to Fort Wayne. Three of these, all commercial, are in use by network-affiliated stations. The Commission has received no applications for the two remaining, one of which is an educational channel.

Angola, with a population of 4,746, is situated about 35 miles northerly of Fort Wayne, within its television market. It is outside the Grade A contours, but within the Grade B contours, of the three Fort Wayne stations, as well as of two share-time stations in Lansing, Michigan. GT&E proposed to carry the signals of these five stations,¹² along with distant signals from a total of five other stations in South Bend, Indiana, and Kalamazoo and Lansing, Michigan.

Delphos, located about 41 miles southeasterly from Fort Wayne, has a population of 6,961. It lies within the Grade A contour only of WIMA-TV, a network-affiliated station in Lima, Ohio,¹³ and, of the Fort Wayne stations, only within the Grade B contour of WANE-TV.¹⁴ Shardco proposed to supply its subscribers with the signals of these two stations,¹⁵ together with the distant signals of a total of 11 stations at two points in Indiana and three in Ohio.¹⁶

Petitioner asserted in opposition that these projects would detrimentally affect the development of UHF broadcasting in the area by wreaking economic damage upon Fort Wayne's existing stations and by discouraging interest in its unassigned commercial channel. Petitioner endeavored to support these positions by a variety of contentions, including prominently the theory that the two proposals involved should be evaluated in terms of the cumulative effect, present and potential, of all CATV activity within its service area.

These arguments the Commission found wanting.¹⁷ The allegation respecting an adverse impact on utilization of Fort Wayne's available commercial channel, said the Commission, was "not adequately supported,"¹⁸ and the distant signal rule would in any event lay its burden upon any CATV proponent seeking entry inside the Grade A contour of either of the Fort Wayne stations. Examining next the welfare of those stations, the Commission noted that only petitioner had objected and, adverting to its omission "to supply specifics regarding its present financial condition, the impact any present CATV activity has had on its operations, or the exact nature of the other CATV proposals it refers to,"¹⁹ the Commission concluded from available information that neither proposition before it could alone bring material harm to WANE-TV. Even if the "cumulative" argument were indulged, the Commission, referring to its carriage²⁰ and nonduplication²¹ rules, did "not believe that the present CATV activity between WANE-TV's predicted grade A and grade B contours is extensive enough to raise any question of substantial impact on WANE-TV."²² And since such activity within WANE-TV's Grade A contour was subject to the distinct requirements of the distant signal rule, the Commission felt that it "need not be counted here in considering cumulative impact."²³ On the basis of this analysis, the Commission, one member dissenting,²⁴ dismissed petitioner's bid for an evidentiary hearing and held that the operations proposed by GT&E and Shardco would be consistent with the public interest.²⁵

Petitioner presses on this review the thesis that the Commission erred in these dispositions. This claim, in its several major facets, we investigate in the ensuing parts of this opinion. From this consideration, we ultimately reach the conclusion that the Commission must be affirmed.

I

We first consider the contention that the Commission's refusal to examine petitioner's contentions in an evidentiary hearing represented an unreasonable deviation from the administrative policies, established in non-CATV cases, designed to foster UHF broadcasting. Petitioner refers us to a number of proceedings in which the Commission designated for hearing, or denied on the pleadings without hearing, contested proposals for alterations in broadcast facilities that would have initiated VHF service in all-UHF areas,²⁶ including the northern Indiana all-UHF enclave.²⁷ Since the projects now before us would convey by CATV a number of distant signals into the all-UHF Fort Wayne market, petitioner argues that the Commission, in approving them without a hearing, arbitrarily discarded years of settled precedent.²⁸

We disagree. Petitioner's requests for a hearing were denied in the view that they were critically deficient in terms of requirements set by the Commission's CATV regulations. We find that the regulations by which the requests were measured are reasonably calculated to promote rather than abridge the regulatory scheme by which UHF has traditionally been afforded special protection. We later sustain the Commission's decisions against charges that it misapplied its regulations and disregarded the considerations upon which they are based. In sum, what we say now is that in rejecting petitioner's efforts to obtain an evidentiary hearing, the Commission did not become unfaithful to the past.

Quite recently, the Commission conducted a comprehensive rule-making proceeding which led to the issuance in 1966 of its Second Report and Order²⁹ asserting its jurisdiction over CATV³⁰ and formulating the precepts by which it was to be governed.³¹ Vitally involved in this process was the balance to be struck between the contributions to improved and more widespread television service made possible by CATV,³² on the one hand, and the effect of CATV upon the healthy maintenance of free local television broadcasting on the other.³³ The Commission evinced principal concern over the full utilization of UHF channels for multiple local service in the major markets, and over the effect of CATV on the development of independent UHF stations for that purpose.³⁴ Contemporary information did not, however, enable the Commission to adopt a wholly comprehensive set of regulations integrating CATV in all of its aspects into the national television system, nor did it seem possible to the Commission to give advance treatment to every possible enigma in the proliferating CATV field.³⁵ What emanated, as the Commission's solution, were the CATV regulations involved in this suit.³⁶

These regulations reflect the Commission's expert judgment that the still unknown repercussions of CATV on UHF broadcasting in major markets could be intelligently ascertained only on an ad hoc basis.³⁷ They also demarcate a specific zone in which the...