National Ass'n of Independent Television Producers and Distributors v. F. C. C.

• Court: U.S. Court of Appeals — Second Circuit
• Writing for the Court: Before FRIENDLY and GURFEIN, Circuit Judges, and BARTELS; GURFEIN
• Citation: National Ass'n of Independent Television Producers and Distributors v. F. C. C., 516 F.2d 526 (2nd Cir. 1975)
• Decision Date: 21 April 1975
• Docket Number: Nos. 847-851,D,s. 847-851
• Parties: NATIONAL ASSOCIATION OF INDEPENDENT TELEVISION PRODUCERS AND DISTRIBUTORS et al., Petitioners, v. FEDERAL COMMUNICATIONS COMMISSION and The United States of America, Respondents, American Broadcasting Companies, Inc., et al., Intervenors. ockets 75-4021 and 75-4024 to 75-4026.

Page 526

516 F.2d 526

NATIONAL ASSOCIATION OF INDEPENDENT TELEVISION PRODUCERS AND DISTRIBUTORS et al., Petitioners, v. FEDERAL COMMUNICATIONS COMMISSION and The United States of America, Respondents American Broadcasting Companies, Inc., et al., Intervenors.

Nos. 847-851, Dockets 75-4021 and 75-4024 to 75-4026.

United States Court of Appeals Second Circuit.

Argued March 7, 1975.

Decided April 21, 1975.

Katrina Renouf, Washington, D. C. (Margot Polivy and Edward J. Kuhlmann, Renouf, McKenna & Polivy, Washington, D. C., of counsel), for petitioner Nat. Association of Independent Television Producers and Distributors.

Stuart Robinowitz, New York City (Donald E. Brown, Moses Silverman, Paul, Weiss, Rifkind, Wharton & Garrison, New York City, of counsel), for petitioners Warner Brothers, Inc., Columbia Pictures Industries, Inc., MGM Television, United Artists Corporation, MCA, Inc., Twentieth Century-Fox Television.

Kenneth A. Cox, Washington, D. C. (William J. Byrnes, John Wells King, Ashbrook P. Bryant, Bethesda, Md., Haley, Bader & Potts, Washington, D. C., of counsel), for petitioner Sandy Frank Program Sales, Inc.

John D. Lane, Washington, D. C. (J. Carter McKaig, Ramsey L. Woodworth, Hedrick & Lane, Washington, D. C., of counsel), for petitioner Westinghouse Broadcasting Co., Inc. Timothy B. Dyk, Washington, D. C. (J. Roger Wollenberg, Sally Katzen, Richard A. Allen, Wilmer, Cutler & Pickering, Washington, D. C., and Eleanor S. Applewhaite, New York City, of counsel), for petitioner and intervenor CBS, Inc.

Thomas N. Frohock, Washington, D. C. (James A. McKenna, Jr., McKenna, Wilkinson & Kittner, Washington, D. C., of counsel), for intervenor American Broadcasting Companies Inc.

Jerome J. Shestack, Philadelphia, Pa. (Bernard G. Segal, Peter S. Greenberg, Deena J. Schneider, Schnader, Harrison, Segal & Lewis, Philadelphia, Pa., and Corydon B. Dunham, New York City and Howard Monderer, Washington, D. C., of counsel), for intervenor Nat. Broadcasting Co., Inc.

Frank W. Lloyd, III, Washington, D. C. (Earle K. Moore, New York City, of counsel), for amici National Black Media Coalition, National Organization for Women, National Congress of Hispanic American Citizens, St. Louis Broadcast Coalition, Community Coalition for Media Change, Alabama Media Project and Alabama Civil Liberties Union, National Citizens Committee for Broadcasting, Office of Communication/United Church of Christ, American Civil Liberties Union, Puerto Rican Media Action and Educational Council, Oakland Media, San Francisco Committee on Children's Television, and Media Access Project.

Daniel M. Armstrong, Counsel, Federal Communications Commission (Ashton R. Hardy, Gen. Counsel, Joseph A. Marino, Asst. Gen. Counsel, Charles H. Bell, Jr., and Jack D. Smith, Jr., Counsel, Federal Communications Commission, of counsel), for respondent Federal Communications Commission.

Before FRIENDLY and GURFEIN, Circuit Judges, and BARTELS, District Judge. ^*

GURFEIN, Circuit Judge:

In 1970 the Federal Communications Commission adopted rules and regulations with respect to competition and responsibility in network television broadcasting. 47 C.F.R. §§ 73.658(j) and (k). These rules included rules concerning "prime time access," and "financial interest and syndication". The rules concerning "financial interest and syndication" are relevant, but are not in issue on this appeal. ¹

The Prime Time Access Rule, section 73.658(k) of the Commission's Rules, prohibits television stations in the 50 largest metropolitan areas from broadcasting network programs in more than three of the four evening hours, 7 P.M. to 11 P.M., in which most people watch television ("Prime Time") to allow the remaining hour ("Access Time") to be available for independently created programs.

The purpose of the Prime Time Access Rule was to free the affiliated stations from the dominance of the networks and to encourage diverse sources of programming and, incidentally, diversity of programming. The Prime Time Access Rule (PTAR I) permitted exceptions for certain network programs of uncontrollable duration, namely, "special news programs dealing with fast-breaking news events, on-the-spot coverage of news events, and political broadcasts by legally qualified candidates for public office." ² The Commission pointed out that in view of the networks' common practice of offering only 31/2 hours of network programs to local network affiliates between 7 P.M. and 11 P.M., the new rule would open up one half hour of additional time per evening for non-network programs on affiliated stations. ³ To encourage access for independent sources, the Commission, after a time, also prohibited insertion of off-network programs ⁴ and feature films televised within the market in the past two years in place of the excluded network programs, for otherwise, as the Commission put it, "this would destroy the essential purpose of the rule to open the market to first run syndicated programs." Federal Communications Commission Report and Order May 4, 1970, 23 F.C.C.2d at 395, also in 35 Fed.Reg. 7417-26 (1970). The validity and constitutionality of PTAR I under the First Amendment were affirmed by this court in Mt. Mansfield Television, Inc. v. Federal Communications Commission, et al., 442 F.2d 470 (2 Cir. 1971).

The Commission re-examined the Prime Time Access Rule thereafter and issued a 1974 Report and Order (PTAR II) modifying the rule so as to eliminate access time on Sunday evenings and to reduce it to one half hour on other evenings with further exemptions for certain categories of programs within the six remaining half-hours. It also pegged access time to a particular time slot (7:30-8 P.M. in the Eastern and Pacific Time Zones, 6:30-7 P.M. in the Central and Mountain Zones). 44 F.C.C.2d 1081 (Feb. 6, 1974). The present petitioner challenged PTAR II. This court refused to review the Commission's order on the merits, but, instead, finding that the Commission had failed to allow adequate time for the amendments to become effective, enjoined the Commission from making the amendments effective, before September 1975. National Association of Independent Television Producers and Distributors et al. (NAITPD) v. F.C.C., 502 F.2d 249 (2 Cir. 1974). The petitions were dismissed without prejudice to their renewal after the Commission had had an opportunity to conduct further proceedings. The court called the Commission's attention, in connection with further hearings it might hold, to certain policy issues raised by the petitions such as the economic consequences of the prime time television rule, and suggested that the views of the Department of Justice and the various public interest groups be obtained.

Pursuant to these suggestions, the Commission held further hearings which resulted in the retention of PTAR I, the withdrawal of PTAR II and the adoption of PTAR III which is now before us for review. ⁵ 50 F.C.C.2d 829.

PTAR III

In PTAR III the Commission retains the original prime time access rule of PTAR I except for certain exemptions for network and off-network programming in cleared access time. The exemptions include: (1) One-half hour of 7 P.M. network news programs provided the station had carried one hour of local news before seven o'clock; (2) Sports runovers and special sports events such as New Year's Day football games; (3) on-the-spot news and political broadcasts. In addition, it grants an exemption in cleared access time for the showing of network or off-network programs designed for children of the age of 2 to 12, documentary programs and public affairs programs. ⁶ PTAR III also amended the exclusion of feature films from cleared access time in a manner later to be described. The Commission, while not incorporating it as a rule, also admonished the stations not to use the exemptions for network programs during access time on Saturday, the night found most conducive thus far to local programming and hour-long access shows, except for "compelling public interest reasons." Second Report P 34, 50 F.C.C.2d at 843-44. The Commission also stated its expectation that stations would devote an appropriate portion of access time, or at least of total prime time, to material (whether it be local, syndicated or network programming) that is particularly directed to the needs and problems of their respective communities and service areas, including the special needs of minority groups. Second Report P 60, 50 F.C.C.2d at 852.

The Parties and Their Positions

The petitioner, NAITPD, seeks review pursuant to 47 U.S.C. § 402(a) and 28 U.S.C. § 2342 of portions of the Commission's PTAR III order amending 73.658(k) of its Rules. NAITPD and two independent television producers favor the retention of the Prime Time Access Rule in its original form (PTAR I), but they object to the new exemptions. ⁷

Divergent views on every aspect of the matter were presented to the Commission. The networks themselves are sharply divided. Of the three network intervenors, NBC and ABC support PTAR III, as well as PTAR I. CBS not only seeks to eliminate the amendments to the Prime Time Rule adopted in PTAR III, but challenges the constitutionality of PTAR I itself. Westinghouse, which is not a network but, like the networks, owns five television stations, and which originally proposed the Rule, opposes the Commission only on PTAR III, but otherwise supports PTAR I. Warner Brothers and other motion picture producers seek to have any prime time access rule held unconstitutional. They also contend that if they are unsuccessful, the court should at least strike down the exclusion from access time of motion pictures which have played on a network. ⁸

The Citizens Communications Center, which speaks for a number of public interest groups, strongly supports the original Prime Time Access Rule and opposes the incursions on cleared access time proposed in PTAR III. It urges us to invalidate the exemptions, not on constitutional...