Northpoint Technology, Ltd. v. F.C.C., 02-1194.
| Decision Date | 15 July 2005 |
| Docket Number | No. 03-1300.,No. 03-1297.,No. 03-1244.,No. 03-1286.,No. 02-1195.,No. 03-1245.,No. 03-1299.,No. 02-1194.,No. 02-1209.,02-1194.,02-1195.,02-1209.,03-1244.,03-1245.,03-1286.,03-1297.,03-1299.,03-1300. |
| Citation | 414 F.3d 61 |
| Parties | NORTHPOINT TECHNOLOGY, LTD. et al., Appellants v. FEDERAL COMMUNICATIONS COMMISSION, Appellee EchoStar Satellite Corporation, et al., Intervenors. |
| Court | U.S. Court of Appeals — District of Columbia Circuit |
Richard P. Bress argued the cause for petitioners DIRECTV, Inc., et al. With him on the briefs were James H. Barker, III., Margaret L. Tobey, Pantelis Michalopoulos, Steven G. Reed, Alice E. Loughran, Phillip L. Spector, and Jeffrey H. Olson. Bart S. Epstein and Christa P. McAndrew entered appearances.
Michael K. Kellogg argued the cause for petitioners Northpoint Technology, Ltd., et al. With him on the briefs were Antoinette C. Bush and J.C. Rozendaal.
Joel Marcus, Counsel, Federal Communications Commission, argued the cause for appellee/respondents. With him on the brief were Robert H. Pate, III, Assistant Attorney General, Robert B. Nicholson and Steven J. Mintz, Attorneys, John A. Rogovin, General Counsel, Austin C. Schlick, Deputy General Counsel, and Daniel M. Armstrong, Associate General Counsel. Jane E. Mago, Assistant General Counsel, entered an appearance.
Before: SENTELLE, ROGERS and TATEL, Circuit Judges.
Opinion for the Court filed by Circuit Judge SENTELLE.
This case concerns new regulations issued by the Federal Communications Commission ("FCC" or "the Commission") allowing terrestrial multichannel video distribution and data service ("MVDDS"), to share the 12.2-12.7 GHz bandwidth ("12 GHz bandwidth") spectrum with direct broadcast satellite ("DBS") television services, as well as a decision by the FCC to auction MVDDS use of that bandwidth.
The regulations are challenged by two sets of petitioners:1 the incumbent providers, DIRECTV, Inc., Satellite Broadcasting and Communications Association, EchoStar Satellite Corp., and SES Americom, Inc. ("DBS providers"), and a would-be competitor, Northpoint Technology, Ltd. ("Northpoint"), which claims credit for inventing MVDDS technology. For reasons stated more fully below, we deny both petitions for review.
Twenty-five years ago, as satellite technology developed to the point at which direct broadcast satellite service to individual homes and businesses was feasible, the FCC began to investigate setting aside specific portions of the spectrum for DBS service. In the runup to an international radio conference in 1979, the Commission "decided to seek international agreement to shift the international allocation of DBS to the 12 GHz band in order to accommodate future U.S. DBS requirements." National Association of Broadcasters v. FCC, 740 F.2d 1190, 1195 (D.C.Cir.1984). The next year, "the Commission began to consider how to protect and advance U.S. interests in DBS use of the 12 GHz band." Id. In 1982, the Commission issued a Report and Order authorizing the use of the 12.2-12.7 GHz bandwidth to DBS use as in the public interest. Report and Order, In the Matter of Inquiry into the Development of Regulatory Policy in Regard to Direct Broadcast Satellites for the Period Following the 1983 Regional Administrative Radio Conference, 90 F.C.C.2d 676, 679, 1982 WL 213097 (July 14, 1982). The Report and Order highlighted the Commission's conclusion "that DBS has the potential to provide extremely valuable services to the American people[,]" including "the provision of improved service to remote areas, additional channels of service throughout the country, programming offering more variety and that is better suited to viewers' tastes, technically innovative services, and expanded non-entertainment service." Id. at 680.
In the same Report and Order, in order to effectuate the allocation of the 12 GHz bandwidth to DBS service, the FCC announced a plan for any remaining terrestrial use of that bandwidth: First, after a grace period of five years, already-authorized terrestrial operations in the bandwidth would be required to operate on a strict non-interference basis to DBS services. Id. at 702. Second, terrestrial operations authorized after the Report and Order would receive conditional licenses, requiring that they not cause any harmful interference to DBS systems. Id.
This policy began to shift when, in the late 1990s, the FCC began to look at the possibility of allowing additional broadcast technologies to share the 12 GHz bandwidth with DBS providers. In 1997, Skybridge, L.L.C., a provider of non-geostationary fixed satellite service ("NGSO-FSS"), filed a Petition for Rulemaking with the FCC to allow it to operate in various wavelengths between 10.7 and 14.5 GHz.
The next year, in 1998, Northpoint filed a Petition for Rulemaking asking that it also be granted permission to use the 12.2-12.7 GHz bandwidth for its terrestrial MVDDS service, which can allow DBS subscribers to receive additional channels. As described by the FCC, the Northpoint technology "use[s] northward pointing receivers at a DBS subscriber's location to receive signals transmitted from terrestrial towers whose directional antennas point southward." First Report and Order and Further Notice of Proposed Rulemaking ("First Order"), 16 F.C.C. Rcd. 4096, 4160 ¶ 164, 2000 WL 1804138 (2000).
The Commission responded to the NGSO-FSS and MVDDS applications by issuing a Notice of Proposed Rulemaking, 14 F.C.C. Rcd. 1131, 1998 WL 812437 (1998), in which it proposed to allow NGSO-FSS providers to use those bands for uplinks and downlinks, and solicited comments on Northpoint's proposal, including further technical analyses of Northpoint's ability to share spectrum with DBS providers. The Commission also issued a Public Notice soliciting competing applications from NGSO-FSS providers to share, inter alia, the 12.2-12.7 GHz bandwidth, as a preliminary step to adopting rules for NGSO-FSS systems in those bandwidths. Public Notice, Report No. SPB-141, 1998 WL 758449 (Nov. 2, 1998). Northpoint, apparently seeing its MVDDS technology as equivalent to satellite service, even though it is terrestrial, submitted an application for usage of that bandwidth pursuant to the November 1998 Public Notice.
Before the FCC could act further, Congress passed the Rural Local Broadcast Signal Act of 1999, Pub L. No. 106-113 Div. B, App. I, Tit. II, 113 Stat. 1501, 1501A-544 (Nov. 29, 1999) ("RLBSA"), meant to give DBS subscribers—predominantly found in small and rural television markets—affordable access to local broadcast stations, whose signals, at the time, typically were not carried by DBS service providers. Specifically, the RLBSA directed the FCC to, within one year, "make a determination regarding licenses or other authorizations for facilities that will utilize, for delivering local broadcast television station signals to satellite television subscribers in unserved and under-served local television markets, spectrum otherwise allocated to special use." Id. § 2002(a). At the same time, the FCC was to "ensure that no facility licensed or authorized under [the RLBSA] cause[ ] harmful interference to the primary users of that spectrum or to public safety spectrum use." Id. § 2002(b)(2).
In its subsequent rulemaking, which it commenced by issuing the First Report and Order and Further Notice of Proposed Rulemaking in 2000, the FCC authorized both NGSO-FSS and MVDDS providers to operate in the 12 GHz bandwidth alongside DBS providers. See First Order, 16 F.C.C. Rcd. at 4109 ¶¶ 19, 21. The FCC reasoned that "[t]he use of innovative spectrum sharing techniques will facilitate a high level of frequency reuse in this band and provide a variety of broadband services to a vast number of customers." First Order, 16 F.C.C. Rcd. at 4161 ¶ 168. The Commission further reasoned that MVDDS in particular "w[ould] be capable of delivering local broadcast signals to satellite television subscribers in unserved and underserved local television markets" as required by the RLBSA. Id. at 4108 ¶ 18.
As for the RLBSA's bar on "harmful interference," in the First Order, the FCC adopted the definition in 47 C.F.R. § 2.1(c): "interference which endangers the functioning of a radionavigation service or of other safety services or seriously degrades, obstructs, or repeatedly interrupts a radiocommunication service ...," and found that "we can develop operating requirements for MVDDS that will ensure that DBS operations are not seriously degraded or subject to repeated interruptions due to MVDDS operations...." First Order, 16 F.C.C. Rcd. at 4177 ¶ 213.
The First Order also served as a Further Notice of Proposed Rulemaking, for rules developing those operating requirements. The Commission specified that for those rules to comply with its definition of "harmful interference," "we will propose that the maximum permissible increase in [DBS service] outage caused by an MVDDS transmitter to any DBS subscriber be a value such that the increase would generally be unnoticed by the DBS subscriber." Id.
The DBS providers petitioned for reconsideration, arguing, inter alia, that the decision to allow the MVDDS operators to share the 12 GHz bandwidth harmed their reasonable reliance interests in the bandwidth, and that at any rate, the Commission had failed to justify its decision in light of the potential for harmful interference.
Shortly thereafter, Congress enacted section 1012 of the LOCAL TV Act, 47 U.S.C. § 1110, which required independent testing of "any terrestrial service technology proposed by any entity that has filed an application to provide terrestrial service" in the 12 GHz band, to ensure that there would not be...
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