U.S. v. Any and All Radio Station Transmission Equipment

• Decision Date: 26 February 1999
• Docket Number: No. 97-3972,97-3972
• Citation: 169 F.3d 548
• Parties: 15 Communications Reg. (P&F) 287 UNITED STATES of America, Plaintiff-Appellee, v. ANY AND ALL RADIO STATION TRANSMISSION EQUIPMENT; Radio Frequency Power Amplifiers, Radio Frequency Test Equipment, and any other equipment associated with or used in connection with the transmission at 97.7 MHZ, located at 1400 Laurel Avenue, Apartment 1109, Minneapolis, MN 55403; Defendants. Alan Fried, Claimant-Appellant, National Association of Broadcasters, Amicus on Behalf of Appellee.
• Court: U.S. Court of Appeals — Eighth Circuit

Page 548

169 F.3d 548

15 Communications Reg. (P&F) 287

UNITED STATES of America, Plaintiff-Appellee, v. ANY AND ALL RADIO STATION TRANSMISSION EQUIPMENT; Radio Frequency Power Amplifiers, Radio Frequency Test Equipment and any other equipment associated with or used in connection with the transmission at 97.7 MHZ, located at 1400 Laurel Avenue, Apartment 1109, Minneapolis, MN 55403 Defendants Alan Fried, Claimant-Appellant National Association of Broadcasters, Amicus on Behalf of Appellee.

No. 97-3972.

United States Court of Appeals,

Eighth Circuit.

Submitted May 14, 1998.

Decided Feb. 26, 1999.

Marshal H. Tanick, Minneapolis, MN, argued (Daniel R. Kelly and Ann M. Zewiske, on the brief), for Appellant.

Joan D. Humes, Assistant United States Attorney, Minneapolis, MN, argued (David L. Lillehaug, on the brief), for Appellee.

Before McMILLIAN, NOONAN ¹ and MORRIS SHEPPARD ARNOLD, Circuit Judges.

McMILLIAN, Circuit Judge.

Alan Fried appeals from a final order entered in the United States District Court ² for the District of Minnesota granting judgment on the pleadings in favor of the United States of America, pursuant to Fed.R.Civ.P. 12(c), in its action for in rem forfeiture of certain radio equipment pursuant to the Communications Act of 1934, as amended, 47 U.S.C. § 510. United States v. Any & All Radio Station Transmission Equipment, 976 F.Supp. 1255 (D.Minn.1997). For reversal, Fried argues the district court erred in holding that it lacked subject matter jurisdiction to adjudicate his constitutional affirmative defenses. For the reasons discussed below, we hold that the district court has exclusive jurisdiction to adjudicate the in rem forfeiture action, including Fried's constitutional challenges to the microbroadcasting regulations. Accordingly, we reverse the judgment The government asserted that the district court had jurisdiction over the in rem forfeiture action pursuant to 28 U.S.C. §§ 1345 (United States as plaintiff), 1355 (action for forfeiture under any Act of Congress). We have appellate jurisdiction over the district court's final order pursuant to 28 U.S.C. § 1291. The notice of appeal was timely filed pursuant to Fed.R.App.P. 4(a).

of the district court and remand the case to the district court for further proceedings.

BACKGROUND FACTS

Most of the facts are not disputed, and the following statement of facts is taken in large part from the district court's memorandum opinion and order.

This in rem forfeiture action involves the seizure of certain radio equipment owned and used by Fried to operate BEAT, an unlicensed radio station, out of his apartment in downtown Minneapolis. BEAT broadcast at a level of about 20 watts, at a frequency of 97.7 MHZ, in an area with a radius of about 6 miles from Fried's apartment. According to Fried, BEAT's broadcast signal did not interfere with any other radio stations.

Fried is a "microbroadcaster." Microbroadcasters operate low-wattage radio stations without licensing approval from the FCC. Microbroadcasters generally use 1 to 95 watts of power to broadcast their FM radio signals. (Extremely low-wattage broadcasts do not need to be licensed by the FCC. See 47 C.F.R. § 15.239(b) (emissions which do not exceed 250 microvolts/meter at 3 meters as measured by average detectors).) At the present time FCC regulations bar issuing licenses to microbroadcasters, that is, any radio station broadcasting below 100 watts. See 47 C.F.R. § 73.211(a), .511(a), . 512(c) (beginning in 1978, FCC refused to issue all future licenses for broadcasting below 100 watts, except in Alaska). It can cost more than $100,000 for a broadcast license for a 100-watt station. Broadcasting without an FCC license is a violation of federal law. 47 U.S.C. § 301. The FCC estimates that there are between 300 to 1,000 unlicensed, low-wattage radio stations broadcasting diverse programs ranging from Christian sermons to rock'n roll to call-in discussions nationwide. Microbroadcasters generally view themselves as part of a free speech movement and as community broadcasters; they typically spend their air time talking about topics such as the evils of income tax and government regulation, reading poetry, playing "alternative" music, and expressing political points of view on many subjects.

This litigation began in July 1996, when the FCC received a complaint from an FM radio station in Rochester, MN, about an unlicensed station broadcasting on 97.7 MHZ. FCC agents investigated and confirmed unauthorized radio transmissions from Fried's apartment. In August 1996 the FCC mailed a warning letter to Fried, informing him that broadcasting unauthorized radio transmissions was unlawful in violation of 47 U.S.C. § 301, ordered him to respond to the warning letter within 10 days, and demanded that he cease operations immediately. Title 47 U.S.C. § 301 provides in part that "[n]o person shall use or operate any apparatus for the transmission of ... signals by radio ... except under and in accordance with [the Federal Communications Act] and with a license in that behalf granted under the provisions of this chapter." Persons who willfully and knowingly intend to violate the licensing requirement may have their equipment or devices seized and forfeited to the United States. Id. § 510(a).

Fried responded to the warning letter by challenging the constitutionality of the microbroadcasting regulations and requested a waiver of the FCC licensing requirement, but he did not cease operation of BEAT. (The government disputed whether or not Fried requested a waiver, but the district court assumed he had done so. 976 F.Supp. at 1256 n. 1.)

PROCEEDINGS IN DISTRICT COURT

The government then brought this in rem forfeiture action in federal district court. The in rem forfeiture complaint asserted the district court had jurisdiction under 28 U.S.C. §§ 1345, 1355, and 47 U.S.C. § 510. In October 1996, after a hearing, the federal magistrate judge ³ issued a warrant of arrest The government filed a motion for judgment on the pleadings in its favor pursuant to Fed.R.Civ.P. 12(c). The government argued that it was undisputed that Fried used and possessed the radio equipment to broadcast without an FCC license. Fried admitted that he intended to continue to operate the radio equipment (and did in fact continue) to broadcast even after receiving the warning letter from the FCC ordering him to cease operations immediately. The district court agreed with the government that there was no material issue of fact in dispute and that it was entitled to judgment as a matter of law--the radio equipment violated 47 U.S.C. § 301 and seizure and forfeiture of the radio equipment was authorized under 47 U.S.C. § 510(a). 976 F.Supp. at 1257.

and notice in rem commanding the United States marshal to "arrest" the radio equipment used to operate the unlicensed radio station. The government gave notice of the arrest by personal service on Fried and his attorney and by publication. The United States marshal executed the warrant and seized the radio equipment in early November 1996. Fried filed a claim of ownership of the seized radio equipment and sought restoration of the equipment. Fried also filed an answer to the in rem forfeiture complaint in which he raised several affirmative defenses challenging the constitutionality of the microbroadcasting regulations. Fried argued in general that the FCC regulations barring new licenses to microbroadcasters violated the First Amendment, equal protection and due process. Fried also argued that the microbroadcasting regulations violated the Communications Act, 47 U.S.C. § 303(g) (directing the FCC to encourage larger and more effective use of radio "in the public interest"), as well as Article XIX of the United Nations Declaration of Human Rights and Article XIX of the International Covenant on Civil and Political Rights. Fried did not challenge the constitutionality of the Communications Act itself. (We note that the Supreme Court upheld the constitutionality of the Communications Act in NBC v. United States, 319 U.S. 190, 227, 63 S.Ct. 997, 87 L.Ed. 1344 (1943).)

The district court noted, however, that Fried's affirmative defenses raised constitutional and other challenges to the microbroadcasting regulations. The government argued that it was entitled to judgment on the pleadings because, pursuant to 47 U.S.C. § 402, the court of appeals, not the district court, has exclusive jurisdiction to determine the validity of the microbroadcasting regulations. Section 402(a) provides that "[a]ny proceeding to enjoin, set aside, annul, or suspend any order of the [FCC] under this chapter (except those appealable under subsection (b) of this section) shall be brought as provided by and in the manner prescribed in chapter 158 of Title 28." Chapter 158 includes 28 U.S.C. § 2342, which provides in part that "[t]he court of appeals ... has exclusive jurisdiction to enjoin, set aside, suspend ... or to determine the validity of--(1) all final orders of the [FCC] made reviewable by § 402(a) of title 47." In other words, the government argued that Fried was seeking to litigate his constitutional challenges in the wrong forum--that instead of the district court, Fried should raise his constitutional challenges before the FCC and then, assuming the FCC rejects his constitutional arguments, seek judicial review by appealing the final order of the FCC directly to the court of appeals. See, e.g., FCC v. ITT World Communications, Inc., 466 U.S. 463, 468, 104 S.Ct. 1936, 80 L.Ed.2d 480 (1984). The FCC has not issued a final order in the present case because Fried has never applied for a license, although he maintained (and the district court assumed so for purposes of analysis) that he had filed a request for a waiver.

Fried argued that the district court, not the court of appeals, had exclusive jurisdiction over the forfeiture action, including the merits of his constitutional challenges to the...