516 F.2d 1101 (D.C. Cir. 1974), 73-2256, National Broadcasting Co., Inc. v. F. C. C.

Docket Nº:73-2256.
Citation:516 F.2d 1101
Party Name:NATIONAL BROADCASTING COMPANY, INC., Petitioner, v. FEDERAL COMMUNICATIONS COMMISSION and the United States of America, Respondents, Accuracy in Media, Inc., Intervenor.
Case Date:September 27, 1974
Court:United States Courts of Appeals, Court of Appeals for the District of Columbia Circuit

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516 F.2d 1101 (D.C. Cir. 1974)




America, Respondents, Accuracy in Media, Inc., Intervenor.

No. 73-2256.

United States Court of Appeals, District of Columbia Circuit

September 27, 1974

Argued Feb. 21, 1974.

Order Vacating Opinion Dec. 13, 1974.

Orders March 18 and 19, 1975.

Dissenting Opinion June 2, 1975.

Judgment Vacated July 11, 1975.

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Floyd Abrams, New York City, with whom Dean I. Ringel and Howard Monderer, Washington, D. C., were on the motion for petitioner.

John W. Pettit, Gen. Counsel, Washington, D. C., with whom Joseph A. Marino, Associate Gen. Counsel, and Lawrence W. Secrest, III, Washington, D. C., were on the motions for respondent.

Timothy B. Dyk, Washington, D. C., with whom J. Roger Wollenberg, Washington, D. C., were on the brief for Columbia Broadcasting System, Inc., as amicus curiae.

J. Laurent Scharff, Washington, D. C., was on the brief for Radio Television News Directors Assn. and the Society of Professional Journalists, Sigma Delta Chi, as amicus curiae.

Ellen S. Agress, New York City with whom Earle K. Moore, New York City, was on the brief for the Office of Communication, United Church of Christ, as amicus curiae.

Stanley H. Kamerow, Washington, D. C., was on the motion for intervenor, Accuracy In Media, Inc., Thomas F. Ragan also entered an appearance for intervenor, Accuracy In Media, Inc.

John B. Summers, Washington, D. C., was on the brief of National Assn. of Broadcasters, as amicus curiae.

Douglas Caddy, Washington, D. C., was on the brief for the Center for the Public Interest of the Robert M. Schuchman Memorial Foundation, Inc., as amicus curiae.

Ellen S. Agress, New York City, was on the brief for National Citizens Committee for Broadcasting, as amicus curiae.

Henry Geller, Washington, D. C., was on the brief for the Rand Corp., as amicus curiae.

Alexander Greenfeld, New York City, was on the brief for New York Times Co., as amicus curiae.

Carl. D. Lawson, Atty., Dept. of Justice, entered an appearance for respondent United States.

Before FAHY, Senior Circuit Judge, and TAMM and LEVENTHAL, Circuit Judges.

LEVENTHAL, Circuit Judge:

On September 12, 1972, the television network of the National Broadcasting Company broadcast its documentary entitled 'Pensions: The Broken Promise,' narrated by Edwin Newman. On November 27, 1972, Accuracy in Media (AIM) filed a complaint with the Federal Communications Commission charging NBC had presented a one-sided picture of private pension plans. The handling of this case by the Commission will be discussed in more detail subsequently (section II). For introductory purposes it suffices to say that on May 2, 1973--as it happens, the same day NBC received

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the George Foster Peabody Award 1 for its production--the Commission's Broadcast Bureau advised NBC that the program violated the Commission's fairness doctrine. 2 That decision was upheld by the Commission. We reverse.


The 'Pensions' program is the heart of the case, and for that reason it is set out in Appendix A to this opinion.

For convenience, we will summarize the main outlines of the program--with notation that certain aspects are dealt with more fully subsequently.

The 'Pensions' program studied the condition under which a person who had worked in an employment situation that was covered by a private pension plan did not in fact realize on any pension rights. Its particular focus was the tragic cases of aging workers who were left, at the end of a life of labor, without pensions, without time to develop new pension rights, and on occasion without viable income.

The program had no set format, but its most prominent feature was a presentation of tragic case histories, often through personal interviews with the persons affected.

One group of workers lost pension eligibility when their company decided to close the division in which they had worked. The first of these was Steven Duane, who after 17 years with a large supermarket chain, lost his job as foreman of a warehouse when the company closed the warehouse and discharged all its employees, leaving them with no job and no pension rights. Now in his fifties, starting again with another company, he felt ill-used and frightened of the future.

There were a number of other specific examples of employees terminated by closing of plants or divisions. The program also focused on the problems of vesting, the years of service with the company required for a worker to become eligible under its pension plan. NBC interviewed employees with many years of service who were suddenly discharged just prior to the date on which their pension rights were to have become vested. Thus Alan Soresen asserted that he was the victim of a practice--a 'very definite pattern'--under which his employer, a large department store chain, fired men just prior to vesting, assigning 'shallow' reasons to men who had served with records beyond reproach.

A similar account was given by Earl Schroeder, an executive fired by Kelly Nut Company, after he more than met his 20 years of service requirement but was six months shy of the age 60 condition.

The program also set forth abuses in the literature given employees ostensibly explaining their plans--pictures of contented retirees and words comprehensible only to the most sophisticated legal specialist. It took up examples where the company had gone bankrupt prior to their date of retirement, leaving the employees without pension funds.

The documentary gave instances of pensions lost for lack of portability, citing plans that required the employee be a member of the same local for the requisite period. NBC interviewed a number of teamsters who had worked for the same employer for over twenty years, but who later found that certain changes in work assignment entailed changes in union local representation and ultimately loss of pension.

Much of the program was a recount of human suffering, interviews in which aging workers described their plight without comment on cause or remedy.

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They told of long years of working in the expectation of comfortable retirements, finding out that no pension would come, having to work into old age, of having to survive on pittance incomes. Interspersed with these presentations by workers were comments by persons active in the pension field, public officials, and Mr. Newman.

None of those interviewed--and these included two United States Senators, a state official, a labor leader, a representative of the National Association of Manufacturers, a consumer advocate, a bank president, and a social worker--disputed that serious problems, those covered by the documentary, do indeed exist. Some of the comments related to the overall performance of the private pension system. We shall discuss these later (section VI B). In addition to comments on the private system generally, there were isolated expressions of views on the related but nonetheless quite distinct issue of the wisdom of reliance on private pensions, regardless of how well they function, to meet the financial needs of retirees. 3 Finally, several speakers gave broad, general views as to what could be done. 4

There were also comments on legislative reforms that might be taken to cope with problems. These will be discussed separately in part VI D of this opinion.

Concluding Remarks

It may be appropriate to quote in full the concluding remarks of narrator Edwin Newman, since the FCC considered them 'indicative of the actual scope and substance of the viewpoints broadcast in the 'Pensions' program.' He said:

NEWMAN: This has been a depressing program to work on but we don't want to give the impression that there are no good private pension plans. There are many good ones, and there are many people for whom the promise has become reality. That should be said.

There are certain technical questions that we've dealt with only glancingly, portability, which means, being able to take your pension rights with you when you go from one job to another, vesting, the point at which your rights in the pension plan become established and irrevocable.

Then there's funding, the way the plan is financed so that it can meet its obligations. And insurance, making sure that if plans go under, their obligations can still be met.

Finally, there's what is called the fiduciary relationship, meaning, who can be a pension plan trustee? And requiring that those who run pension funds adhere to a code of conduct so that they cannot enrich themselves or make improper loans or engage in funny business with the company management or the union leadership.

These are matters for Congress to consider and, indeed, the Senate Labor Committee is considering them now. They are also matters for those who are in pension plans. If you're in one, you might find it useful to take a close look at it.

Our own conclusion about all of this, is that it is almost inconceivable that this enormous thing has been allowed to grow up with so little understanding of it and with so little protection and such uneven results for those involved.

The situation, as we've seen it, is deplorable.

Edwin Newman, NBC News.

Success of Program

Like many documentaries, 'Pensions' was a critical success (supra, note 1)

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but not a commercial success. We shall consider the television reviews in more detail subsequently, but it may be observed here that they were generally enthusiastic. Critics...

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