American Civil Liberties Union v. F.C.C.

• Citation: 823 F.2d 1554
• Decision Date: 17 July 1987
• Docket Number: Nos. 85-1666,s. 85-1666
• Parties: AMERICAN CIVIL LIBERTIES UNION, Petitioner, v. FEDERAL COMMUNICATIONS COMMISSION and United States of America, Respondents, Tele-Communications, Inc., et al., Intervenors. CABLE TELEVISION ACCESS COALITION, INC., Petitioner, v. FEDERAL COMMUNICATIONS COMMISSION and United States of America, Respondents, Tele-Communications, Inc., et al., Intervenors. NATIONAL LEAGUE OF CITIES, Petitioner, v. FEDERAL COMMUNICATIONS COMMISSION and United States of America, Respondents, Tele-Communications, Inc., et al., Intervenors. NATIONAL FEDERATION OF LOCAL CABLE PROGRAMMERS, et al., Petitioners, v. FEDERAL COMMUNICATIONS COMMISSION and United States of America, Respondents, Tele-Communications, Inc., et al., Intervenors. CITY OF NEW YORK, Petitioner, v. FEDERAL COMMUNICATIONS COMMISSION and United States of America, Respondents, Tele-Communications, Inc., et al., Intervenors. GUAM CABLE TV, Petitioner, v. FEDERAL COMMUNICATIONS COMMISSION and United States of America, Respondents, Tele-Communications, Inc., et al., Intervenors. COUNTY OF CONTRA COSTA, CALIFORNIA, Petitioner, v. FEDERAL COMMUNICATIONS COMMISSION and United States of America, Respondents, Tele-Communications, Inc., et al., Intervenors. YAKIMA VALLEY CABLEVISION, INC., Petitioner, v. FEDERAL COMMUNICATIONS COMMISSION and United States of America, Respondents, Board of Supervisors of Fairfax County, VA, Cities of Sunnyside and Grandview, Wash. and City of Southfield, Michigan, National Cable Television Association, Inc., Centel Corporation, Intervenors. CONNECTICUT CABLE TELEVISION ASSOCIATION, INC., Petitioner, v. FEDERAL COMMUNICATIONS COMMISSION and United States of America, Respondents, National Cable Television Association, Inc., Centel Corporation, Intervenors. to 85-1671, 85-1673, 86-1432 and 86-1439.
• Court: U.S. Court of Appeals — District of Columbia Circuit

Page 1554

823 F.2d 1554

262 U.S.App.D.C. 244

AMERICAN CIVIL LIBERTIES UNION, Petitioner, v. FEDERAL COMMUNICATIONS COMMISSION and United States of

America, Respondents,

Tele-Communications, Inc., et al., Intervenors.

CABLE TELEVISION ACCESS COALITION, INC., Petitioner, v. FEDERAL COMMUNICATIONS COMMISSION and United States of

America, Respondents,

Tele-Communications, Inc., et al., Intervenors.

NATIONAL LEAGUE OF CITIES, Petitioner, v. FEDERAL COMMUNICATIONS COMMISSION and United States of

America, Respondents,

Tele-Communications, Inc., et al., Intervenors.

NATIONAL FEDERATION OF LOCAL CABLE PROGRAMMERS, et al., Petitioners, v. FEDERAL COMMUNICATIONS COMMISSION and United States of

America, Respondents,

Tele-Communications, Inc., et al., Intervenors.

CITY OF NEW YORK, Petitioner, v. FEDERAL COMMUNICATIONS COMMISSION and United States of

America, Respondents,

Tele-Communications, Inc., et al., Intervenors.

GUAM CABLE TV, Petitioner, v. FEDERAL COMMUNICATIONS COMMISSION and United States of

America, Respondents,

Tele-Communications, Inc., et al., Intervenors.

COUNTY OF CONTRA COSTA, CALIFORNIA, Petitioner, v. FEDERAL COMMUNICATIONS COMMISSION and United States of

America, Respondents,

Tele-Communications, Inc., et al., Intervenors.

YAKIMA VALLEY CABLEVISION, INC., Petitioner, v. FEDERAL COMMUNICATIONS COMMISSION and United States of

America, Respondents, Board of Supervisors of Fairfax

County, VA, Cities of Sunnyside and Grandview, Wash. and

City of Southfield, Michigan, National Cable Television

Association, Inc., Centel Corporation, Intervenors.

CONNECTICUT CABLE TELEVISION ASSOCIATION, INC., Petitioner, v. FEDERAL COMMUNICATIONS COMMISSION and United States of

America, Respondents, National Cable Television

Association, Inc., Centel Corporation,

Intervenors.

Nos. 85-1666 to 85-1671, 85-1673, 86-1432 and 86-1439.

United States Court of Appeals, District of Columbia Circuit.

Argued Jan. 22, 1987.

Decided July 17, 1987.

Petitions for Review of Orders of the Federal Communications commission.

Paul S. Ryerson and Robert T. Perry, with whom Robert Alan Garrett and Patrick J. Grant, Washington, D.C., for the City of New York, Cynthia Pols and Frederick Simpich, Washington, D.C., for National League of Cities, Michael Botein Washington, D.C., for ACLU, et al., Edward J. Perez, Deputy City Atty., Los Angeles, Cal., for the City of Los Angeles, Cal., Garry E. Hunter, Athens, Ohio, for the City of Athens, Ohio, Michael I. Meyerson for New York Citizens' Committee for a Responsible Media, Joseph Van Eaton, Washington, D.C., for National Federation of Local Cable Programmers, William B. Gundling, Asst. Atty. Gen., State of Conn., Hartford, Conn., for the Dept. of Public Utility Control of the State of Connecticut, and Edward P. Kearse for Nat. Ass'n of State Cable Agencies, were on the joint brief for American Civil Liberties Union, et al., petitioners in Nos. 85-1666, 85-1667, 85-1668, 85-1669, 85-1670 and 85-1673 and intervenors in No. 85-1666.

Brent N. Rushforth, with whom John I. Davis, Washington, D.C., for Connecticut Cable Television Ass'n, Inc., Stuart F. Feldstein, Washington, D.C., for Yakima Valley Cablevision, Inc., Ian D. Volner and Mark L. Pelesh, Washington, D.C., for Media General Cable of Fairfax, Inc., and Wesley R. Heppler and James F. Ireland, III, Washington, D.C., for United Cable Television Corp., et al., were on the joint brief for Connecticut Cable Television Ass'n, Inc., et al. petitioners in Nos. 86-1439 and 86-1432 and intervenors in No. 85-1666. John P. Cole, Jr. and David M. Silverman, Washington, D.C., entered appearances for intervenor, United Cable Television Corp., et al.

Robyn G. Nietert, with whom Richard L. Brown and Lauritz S. Helland, Washington, D.C., were on the brief, for Guam Cable TV, petitioner in No. 85-1671 and intervenor in No. 85-1666.

Gregory M. Christopher, Counsel, F.C.C., with whom John E. Ingle, Deputy Associate Gen. Counsel and Jane E. Mago, Counsel, F.C.C., were on the brief for respondent F.C.C. Daniel M. Armstrong, Asst. Gen. Counsel, F.C.C., John J. Powers, III, Frederic Freilicher, Marion L. Jetton and Robert J. Wiggers, Attys., Dept. of Justice, Washington, D.C., also entered appearances for respondents, F.C.C. and U.S. in Nos. 85-1666, 85-1667, 85-1668, 85-1669, 85-1670, 85-1671, 85-1673, 86-1432 and 86-1439.

Michael S. Schooler, with whom Brenda L. Fox, Washington, D.C., and Stephen R. Effros for National Cable Television Ass'n, Inc., Theodore D. Frank, Washington, D.C., for Centel Corp., David G. Rozzelle and Kathryn Riley Dole, Washington, D.C., for Gill Industries, Inc., Stuart F. Feldstein, Washington, D.C., for Arizona Cable Television Ass'n, David J. Saylor and Steven J. Horvitz, Washington, D.C., for Harron Communications Corp., and Mark J. Prak, Raleigh, N.C., for North Carolina Cable Television Ass'n, Inc., were on the joint brief for intervenors, National Cable Television Ass'n, et al. in Nos. 85-1666, 86-1432 and 86-1439.

Gary L. Christensen, Arlington, Va., was on the brief for intervenor, pro se in No. 85-1666.

Nicholas P. Miller, W. Randolph Young and Larrine S. Holbrooke, Washington, D.C., were on the brief for intervenor, City of Dubuque, Iowa in No. 85-1666.

Richard K. Greenberg, Asst. Atty. Gen., State of Conn., Hartford, Conn., was on the brief for intervenor The State of Connecticut and its Com'r of Revenue Services in No. 85-1666.

B. Jay Baraff and James E. Meyers, Washington, D.C., entered appearances for intervenor, Tele-Communications in No. 85-1666.

Robert F. Corazzini and Peter H. Feinberg, Washington, D.C., entered appearances for intervenor, Adams-Russell Cable Services, et al. in No. 85-1666.

Paul G. Gaston and Paul J. Berman, Washington, D.C., entered appearances for intervenor, Cellular Telecommunications Div. of Telocator Network of America in 85-1666.

Paul Glist, Washington, D.C., entered an appearance for intervenor, Texas Cable in No. 85-1666.

Jack N. Goodman and Robert J. Aamoth, Washington, D.C., entered appearances for intervenor, Time, Inc. in No. 85-1666.

John F. Beasley and Vincent L. Sgrosso, Washington, D.C., entered appearances for intervenor, BellSouth Corp. in No. 85-1666.

Phillip L. Spector, Washington, D.C., entered an appearance for intervenor, Direct Satellite Communications, Inc. in No. 85-1666.

David R. Anderson and Andrea Ann Timko, Washington, D.C., entered appearances for intervenor, Post-Newsweek Cable, Inc.

James M. Smith and J. Laurent Scharff, Washington, D.C., entered appearances for intervenor, Ass'n of Independent Television Stations, Inc. in No. 85-1666.

Donna A. Demac, New York City, entered an appearance for intervenor, Office of Communications of the United Church of Christ in No. 85-1666.

Henry L. Baumann and Michael D. Berg, Washington, D.C., entered appearances for intervenor, Nat. Ass'n of Broadcasters in No. 85-1666.

Donald J. Mulvihill, Hugh P. Morrison, Jr., Kathy M. Silberthau, Rand McQuinn, Washington, D.C., David Stitt, and Michael Long, Fairfax, Va., entered appearances for intervenor, The Bd. of Supervisors of Fairfax County, Virginia in Nos. 85-1666 and 86-1432.

George Y. Wheeler, Alan Y. Naftalin and Gregory C. Staple, Washington, D.C., entered appearances for intervenor, Eagle Telecommunications in No. 85-1666.

Craig J. Gehring, John Longstreth and Henry C. Eisenberg, Washington, D.C., entered appearances for Cities of Sunnyside and Grandview, Washington, etc. in No. 85-1666 and 86-1432.

Before EDWARDS, STARR and BUCKLEY, Circuit Judges.

Opinion for the Court PER CURIAM. ^*

Separate concurring statement filed by Circuit Judge EDWARDS.

Opinion dissenting in part filed by Circuit Judge STARR.

PER CURIAM:

In these consolidated cases, we review orders of the Federal Communications Commission ("FCC" or the "Commission") implementing the Cable Communications Policy Act of 1984 (the "Cable Act" or the "Act"), Pub.L. No. 98-549, 98 Stat. 2779 (codified in scattered sections of 47 U.S.C.). The orders under review embody a number of "legislative" and "interpretive" rules that have been challenged by an assortment of discontented parties. The central issues raised by these petitions for review, however, are two. The first is whether the FCC properly identified the circumstances and conditions under which local communities (or "franchising authorities") may regulate the rates charged by cable operators for cable services. The second is whether the FCC may, under certain circumstances, decline to resolve disputes over whether particular "taxes" or "assessments" imposed on cable companies by franchising authorities violate the federal standards established by Congress for "franchise fees."

Based on our careful review of the FCC orders, and the arguments advanced by the parties, we conclude that the rules adopted by the FCC are, for the most part, reasonable and consistent with the provisions of the Cable Act. However, we also find that several aspects of the FCC's rules are either arbitrary or inconsistent with the Act. Accordingly, we affirm in part and reverse and remand in part.

I. BACKGROUND

A. A Synopsis of Cable Television Regulation Prior to Enactment of the Cable Act

The Communications Act of 1934, Pub.L. No. 73-416, 48 Stat. 1064 (codified as amended in scattered sections of 47 U.S.C.) grants the FCC broad authority to regulate all aspects of interstate communication by wire or radio. See generally Capital Cities Cable, Inc. v. Crisp, 467 U.S. 691, 699-700, 104 S.Ct. 2694, 2700-2701, 81 L.Ed.2d 580 (1984); United States v. Southwestern Cable Co., 392 U.S. 157, 167-68, 88 S.Ct. 1994, 1999-2000, 20 L.Ed.2d 1001 (1968). Prior to passage of the Cable Act in 1984, however, the Communications Act did not speak directly to regulation of cable television. ¹ Faced with this congressional silence, the FCC--with the approval of the Supreme Court--undertook to regulate cable in those circumstances where regulation was "reasonably ancillary to the...