Lakeshore Broad. v. Fed. Commun. Comm'n, 98-1478
| Court | United States Courts of Appeals. United States Court of Appeals (District of Columbia) |
| Citation | 199 F.3d 468 |
| Docket Number | No. 98-1478,98-1478 |
| Parties | (D.C. Cir. 1999) Lakeshore Broadcasting, Inc.,Appellant v. Federal Communications Commission, Appellee |
| Decision Date | 06 March 2000 |
Page 468
v.
Federal Communications Commission, Appellee
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Decided December 21, 1999
Rehearing and Rehearing En Banc Denied March 6, 2000
Page 469
Appeal of an Order of the Federal Communications Commission
George R. Borsari, Jr. argued the cause for appellant. With him on the briefs was Anne Thomas Paxson.
Pamela L. Smith, Counsel, Federal Communications Commission, argued the cause for appellee. On the brief were Christopher J. Wright, General Counsel, Daniel M. Armstrong, Associate General Counsel, C. Grey Pash, Jr., and K. Michele Walters, Counsel.
Before: Ginsburg, Henderson, and Randolph, Circuit Judges.
Opinion for the Court filed by Circuit Judge Ginsburg.
Page 470
Ginsburg, Circuit Judge:
Lakeshore Broadcasting Corporation appeals an order of the Federal Communications Commission dismissing Lakeshore's application for a construction permit due to its failure to make timely payment of the hearing fee. Pursuant to Commission regulations, the deadline for payment of the hearing fee had been announced in a public notice released only in the Commission's press office in Washington, D.C.
Lakeshore claims that the Commission violated the Communications Act of 1934, the agency's own regulations, and the Due Process Clause of the Fifth Amendment to the Constitution of the United States by dismissing Lakeshore's application for failure to meet a deadline of which Lakeshore was never given personal notice. Lakeshore also challenges as arbitrary and capricious the Commission's denial of Lakeshore's petition for waiver of the deadline and reinstatement of its application.
We affirm the order of the Commission. The dismissal of Lakeshore's application for failure to pay by the deadline does not violate any statutory, regulatory, or constitutional constraint. Because the Commission's policy is lawful, and because Lakeshore has failed to demonstrate that the agency treated its application differently from others similarly situated, the Commission properly denied Lakeshore's petition for waiver and reinstatement.
I. Background
Under the Communications Act of 1934, the Commission grants an application for a broadcasting license based upon its determination that "the public interest, convenience, and necessity will be served." 47 U.S.C. 309(a). If the Commission has before it two or more "mutually exclusive" applications--that is, applications of which only one can be granted because they seek the same license or different licenses for broadcasting stations that would interfere with each other-then the Commission must hold a "comparative hearing" to consider the relative merits of the applications. See Ashbacker Radio Corp. v. FCC, 326 U.S. 327, 333 (1945).
The Commission periodically releases a public notice listing applications newly accepted for filing, grouped by station so that it is apparent where there are mutually exclusive applications subject to a comparative hearing. During the period relevant to this litigation, such public notices were released only in the Commission's press office in Washington, D.C.;they were neither mailed to the listed applicants nor published by the Commission in any other form. At some point after release of the public notice, the Commission, as required by statute, "formally designate[s] the application for hearing ... [and] forthwith notif[ies] the applicant." 47 U.S.C. 309(e).Specifically, the Commission issues a hearing designation order (HDO) giving the time and place of the hearing and setting forth issues to be heard, which it mails to each affected applicant. See 47 C.F.R. 1.221(a)-(b).
A. The Hearing Fee Deadline Rule
In 1986 the Congress added 8 to the Communications Act, 47 U.S.C. 158, instructing the Commission to assess and collect a substantial fee from each applicant subject to a comparative hearing. See Consolidated Omnibus Budget Reconciliation Act of 1985, Pub. L. No. 99-272, 5002(e), 100 Stat. 82, 118 (1986) (COBRA). The Commission was authorized to "prescribe appropriate rules and regulations to carry out" the fee program, 47 U.S.C. 158(f), and to dismiss applications for "failure to pay [the fee] in a timely manner," id. 158(c)(2).
The Commission first promulgated a rule establishing the deadline for payment of the comparative hearing fee in 1987.At that time, the Commission opined that "[t]he relevant legislative history indicates that [the hearing fee] should be levied when an application is designated for hearing."
Page 471
See Establishment of a Fee Collection Program, 2 F.C.C.R. 947, p 138 (1987) (citing H.R. Conf. Rep. No. 99-453, at 427 (1985)). The Commission therefore tied the fee deadline to the formal act of designating an application for hearing: Each applicant was required to pay the hearing fee within 20 days of the Commission's mailing the HDO to that applicant. See id. at p p 144, 157. Thus, under the 1987 rule, an applicant whose application had been designated for hearing received personal notice from which the applicant--provided it knew the deadline rule--could determine when the hearing fee was due.
In 1990 the Commission decided to move the time for payment of the hearing fee to an earlier stage in the comparative process; it did so in order to promote earlier settlements by weeding out non-serious applicants and by encouraging the serious ones to settle before the hearing fee was due. See Proposals to Reform the Commission's Comparative Hearing Process to Expedite the Resolution of Cases, Report and Order, 6 F.C.C.R. 157, p 4 [Report & Order]; see also 47 U.S.C. 158(g) (1990) (setting comparative hearing fee at $6,760 for 1990). The Commission again considered the remark in the conference report on the COBRA linking the hearing fee to formal designation of the application for hearing, but concluded this time that the remark was descriptive rather than prescriptive; the Congress did not intend to limit the Commission's discretion over when to require payment. See Report & Order, 6 F.C.C.R. 157, p 6 n.8. The Commission then adopted its current approach to setting the deadline for payment, under which the deadline is tied to the release of the public notice rather than to formal designation of the application for hearing and the mailing of the HDO:
In addition to announcing the acceptance of mutuallyexclusive applications and establishing a date for thefiling of petitions to deny such applications, the publicnotice ... will also announce the date on which allmutually exclusive applicants will be required to pay thehearing fee.
47 C.F.R. 73.3573(g)(2)(i). The new rule makes no provision for personal notice to the applicant of the deadline for paying the fee.
The practical effect of the 1990 rule is that once one files an application with the Commission, one must monitor the Commission's public notices in order to determine when one's application has been accepted for filing and whether a mutually exclusive application has been accepted; if so, then there will be a comparative hearing, a hearing fee, and a deadline for paying the fee. If one misses the relevant public notice, then the payment deadline could pass--and one's application be dismissed--before one receives personal notice (in the HDO) that a hearing is necessary.
B.Lakeshore's Application
On January 19, 1993 Lakeshore applied to the Commission for a permit to construct a new FM broadcast station to operate on channel 229A. On April 9, 1993 the Commission released at its Washington, D.C. press office Public Notice NA-168, reporting the acceptance of five mutually exclusive applications for channel 229A, including Lakeshore's. See Notice of Acceptance for Filing of FM Broadcast Applications and Notice of Petitions to Deny and Hearing Fee Deadlines, Mimeo No. 32634. The Public Notice also stated that Lakeshore and its rivals were each required to pay the $6,760 hearing fee "no later than June 11, 1993, or the application will thereafter be dismissed." Id.
When June 11 arrived the other four applicants had paid their hearing fees but Lakeshore had failed to do so. By letter dated August 3, 1993 the Commission staff therefore dismissed Lakeshore's application. In response, Lakeshore tendered a check in the amount of the hearing fee, along with a petition requesting reconsideration of the dismissal or waiver of the deadline and reinstatement of its application.
Page 472
The staff denied Lakeshore's petition in 1995, and in 1998 the Commission denied Lakeshore's application for review. See In re Application of Lakeshore Broadcasting, Inc., 13 F.C.C.R. 19062.
II. Analysis
Lakeshore challenges the dismissal of its application, first, on the ground that the 1990 deadline rule violates the Communications Act of 1934 by requiring payment of the hearing fee before an application has been formally designated for hearing. Second, Lakeshore claims the dismissal of its application violates the Commission regulation precluding enforcement of an unpublished requirement against a party that has not received actual notice thereof. Third, Lakeshore argues that the dismissal violates its fifth amendment right to due process, both because Lakeshore was not given personal notice of the deadline and because the published rule does not provide fair notice of what is required of an applicant. In the alternative, Lakeshore challenges as unreasonable and discriminatory the Commission's denial of its petition for waiver of the deadline and reinstatement of its application.
A. The Communications Act of 1934
As mentioned above, Lakeshore claims that the Commission's deadline rule violates the Communications Act of 1934 because it requires payment of the hearing fee prior to formal designation of the application for hearing. Under 8 of the Act, as added by the COBRA in 1986, the Commission is required...
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