Daniels Cablevision, Inc. v. San Elijo Ranch, Inc.
| Decision Date | 12 July 2001 |
| Docket Number | No. 01-1080-IEG(CGA).,01-1080-IEG(CGA). |
| Citation | 158 F.Supp.2d 1178 |
| Court | U.S. District Court — Southern District of California |
| Parties | DANIELS CABLEVISION, INC., Plaintiff, v. SAN ELIJO RANCH, INC., and Does 1 through 50, inclusive, Defendants. |
Stephen D. Kaus, Cooper White and Cooper, San Francisco, CA, for Plaintiff.
Thomas F. Geselbracht, Piper Marbury Rudnick and Wolfe, Chicago, IL, Jeffrey A. Rosenfeld, Jeffrey A. Rosenfeld, Piper Marbury Rudnick and Wolfe, Los Angeles, CA, for Defendants.
ORDER DENYING PLAINTIFF'S MOTION FOR PRELIMINARY INJUNCTION
On June 15, 2001, plaintiff Daniels Cablevision, Inc. ("plaintiff") filed a complaint against defendant San Elijo Ranch, Inc. ("defendant") alleging that defendant violated the Cable Communications Policy Act, 47 U.S.C. § 521. In addition to its complaint, plaintiff also filed the present motion for preliminary injunction. For the reasons stated herein, the Court denies the motion for preliminary injunction.
Plaintiff is one of two authorized cable franchisees in the city of San Marcos. The other franchisee is Times Mirror Cable Television, now called Cox Communications ("Cox Cable").
Defendant is developing a community of approximately 3,400 homes in the city of San Marcos, known as San Elijo Hills. In the course of developing the San Elijo Hills community, defendant has excavated numerous trenches ("utility trenches") for the placement of public utilities, including cable television wires and facilities.
In April 2000, plaintiff began installing its cable in the utility trenches on the San Elijo Hills development. However, in July 2000, the President of San Elijo Ranch, Paul Borden, informed plaintiff that it was obligated to pay a "trenching fee" of $250 per home in order to continue installing its cable. (See Odum Decl. Ex. C). Plaintiff received an invoice from defendant demanding $221,000 for the "trenching fee," and indicating that if payment was not received within 30 days, defendant would "deny [plaintiff] further access to the joint utility trenches in San Elijo Hills."1 (See id.)
According to defendant, Cox Cable (plaintiff's direct competitor) paid the "trenching fee," and is therefore allowed to install its cable in the utility trenches before they are paved over and the development is completed.2 (See Noland Decl. ¶ 4.) In addition to Cox Cable, defendant asserts that it also receives "partial reimbursement" of trenching costs from Pac Bell and San Diego Gas & Electric ("SDG & E"). (See Butsko Decl. ¶ 15.) Defendant claims that the customary practice is for utilities (except electric utilities) to pay a prorated portion of the trenching costs.
Although it filed final maps with the city of San Marcos offering to dedicate the platted streets as public easements, defendant asserts that the City of San Marcos has not yet accepted the improvements, and the utility trenches have not yet been formally "dedicated" to the public under California law. See CALIFORNIA GOVERNMENT CODE § 66477.2.
On June 15, 2001, after several weeks of unsuccessful negotiations between the parties, plaintiff filed a motion for a temporary restraining order ("TRO"), requesting that the Court enjoin defendant from interfering with plaintiff's installation of cable facilities within the San Elijo Hills development.
On June 21, 2001, the Court issued a TRO prohibiting defendant from excluding plaintiff from accessing the utility trenches in the San Elijo Hills development, pending the Court's ruling on the present motion for preliminary injunction. Pursuant to the Court's order, plaintiff posted a security bond in the amount of $50,000.
A preliminary injunction is a provisional remedy designed to preserve the status quo and to prevent irreparable loss of rights prior to judgment. Sierra On-Line, Inc. v. Phoenix Software, Inc., 739 F.2d 1415, 1422 (9th Cir.1984). To satisfy its burden, the party moving for a preliminary injunction "must show either (1) a combination of probable success on the merits and the possibility of irreparable harm, or (2) that serious questions [going to the merits] are raised and the balance of hardships tips sharply in the moving party's favor." Rodeo Collection, Ltd. v. West Seventh, 812 F.2d 1215, 1217 (9th Cir.1987). "These tests are not two distinct tests, but rather the opposite ends of a single `continuum in which the required harm varies inversely with the required showing of meritoriousness.'" Id. ). For "affirmative" or "mandatory" injunctions that alter the status quo, rather than simply preserve it, many courts hold the party seeking the injunction to the higher standard of showing a "clear" or "substantial" likelihood of success. Dahl v. HEM Pharmaceuticals Corp., 7 F.3d 1399, 1403 (9th Cir.1993). Importantly, the factual determinations made at the preliminary injunction stage, and the legal conclusions drawn from them, are not final adjudications on the merits; instead, the court "need only find probabilities that the necessary facts can be proved." Sierra On-Line, Inc., 739 F.2d at 1423.
Enacted in 1984, the Cable Communications Policy Act ("Cable Act"), 47 U.S.C. § 521, established a national framework to regulate the rapid expansion of the cable industry across the country.3 To that end, the Cable Act includes a provision which gives cable television operators franchised by local authorities a right of access to public rights of way and to easements which are "dedicated for compatible uses" for the purpose of installing cable transmission services. Specifically, section 621(a)(2) of the Cable Act provides:
Any franchise shall be construed to authorize the construction of a cable system over public rights-of-way, and through easements, which is within the area to be served by the cable system and which have been dedicated for compatible uses....
47 U.S.C. § 541(a)(2).4
However, although section 621(a)(2) authorizes cable operators to access public rights of way and "dedicated" easements, it is unclear whether this provision allows a cable franchise the ability to access private easements in developments which have not been formally ceded to the public. A number of courts have concluded that by authorizing access to easements "dedicated for compatible uses," Congress intended to provide cable operators the right to access private, as well as public, easements. See generally Heritage Cablevision of California, Inc. v. J.F. Shea Co., 1990 U.S. Dist. LEXIS 18811 (N.D.Cal.1990); United Cable Television v. Louis J. Eyde Ltd. Family Partnership, 1989 U.S. Dist. LEXIS 18154 (W.D.Mich.1989); Greater Worcester Cablevision, Inc. v. Carabetta Enterprises, 682 F.Supp. 1244 (D.Mass.1985).
However, the majority of courts analyzing this issue have determined that Congress' use of the term "dedicated" limits section 621(a)(2)'s application to easements which have been formally "dedicated" to the public, and thus, does not encompass strictly private easements. See generally TCI of North Dakota, Inc. v. Schriock Holding Co., 11 F.3d 812, 817 (8th Cir. 1993); Media General Cable v. Sequoyah Condominium Council, 991 F.2d 1169, 1173 (4th Cir.1993); Cable Holdings of Georgia v. McNeil Real Estate, 953 F.2d 600, 608 (11th Cir.1992).
In the present case, plaintiff claims that section 621(a)(2) requires that defendant grant it access to the private easements5 on the San Elijo Hills development. Thus, critical to the Court's resolution of the issues involved in this case is the meaning of the term "dedicated" under the Cable Act.6
The Ninth Circuit considered, but did not decide, the importance of defining the term "dedicated" as it is used in the access provision of the Cable Act. In Century Southwest Cable Television v. CIIF Associates, 33 F.3d 1068 (9th Cir.1994), the Ninth Circuit noted that to prevail under the Cable Act, a cable operator is only entitled to access easements that are "dedicated for compatible uses." The Ninth Circuit stated, therefore, that in analyzing such a claim, a court must first determine the meaning of the term "dedicated" under the Cable Act: "[d]oes the term [dedicated] mean merely `put aside for use' of some body, such as a utility, or does it mean a grant and a gift of an interest in land for public use?" Century Southwest, 33 F.3d at 1070.
In proposing this question, the Ninth Circuit recognized that several circuits have held that Congress chose to use "dedicated" as the term is used in real property law — meaning that there must be a formal grant for public use in order for an easement to be "dedicated." See id. (citing TCI of North Dakota, 11 F.3d at 817 (8th Circuit); Media General Cable, 991 F.2d at 1173 (4th Circuit); McNeil, 953 F.2d at 608-09 (11th Circuit)).
However, the Ninth Circuit also recognized that proponents of the contrary interpretation maintain that "dedicated," as it is used in the Cable Act, should not be given its technical definition, but rather, should be given a meaning reflecting its common usage — such as "set aside for other purposes." Century Southwest, 33 F.3d at 1070. The Federal Communications Commission, charged with the administration of the Cable Act, has apparently construed the term "dedicated" in this fashion.7
Unfortunately, the Ninth Circuit in Century Southwest determined that it did not have to decide this issue because there was no evidence of existing easements on the property in that case, and therefore, the question of whether easements were "dedicated" under the Cable Act was irrelevant to its resolution. Consequently, after noting the importance of the meaning of "dedicated" to lawsuits brought under the Cable Act, the Ninth Circuit declined to offer its interpretation of that term. Id. at 1071.
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...47 U.S.C. § 521 et seq. (the "Cable Act"), to address the rapid expansion of the cable industry. Daniels Cablevision, Inc. v. San Elijo Ranch, Inc., 158 F.Supp.2d 1178, 1180-81 (S.D. Cal. 2001); see also Cable Investments, Inc. v. Woolley, 867 F.2d 151, 154 (3rd Cir. 1989). Because the prev......
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