United Telephone Company of Pennsylvania v. Federal Communications Commission, Civ. No. 74-96.

• Decision Date: 19 February 1974
• Docket Number: Civ. No. 74-96.
• Citation: 375 F. Supp. 992
• Parties: The UNITED TELEPHONE COMPANY OF PENNSYLVANIA, a corporation v. FEDERAL COMMUNICATIONS COMMISSION.
• Court: U.S. District Court — Middle District of Pennsylvania

375 F. Supp. 992

The UNITED TELEPHONE COMPANY OF PENNSYLVANIA, a corporation v. FEDERAL COMMUNICATIONS COMMISSION.

Civ. No. 74-96.

United States District Court, M. D. Pennsylvania.

February 19, 1974.

Metzger, Hafer, Keefer Thomas & Wood, Harrisburg, Pa., Anderson, Russell & Kill, New York City, Joseph E. Gallagher, Scranton, Pa., for plaintiff.

Michael McDowell, Asst. U. S. Atty., Lewisburg, Pa., Gregory M. Christopher, Fed. Communications Comm., Washington, D. C., Arthur Berman, Harrisburg, Pa., Lewis A. Rivlin, Washington, D. C., for defendant.

MEMORANDUM AND ORDER

NEALON, District Judge.

Before the Court is a motion for a preliminary injunction filed by plaintiff, The United Telephone Company of Pennsylvania (United), to enjoin a hearing scheduled for February 19, 1974, before the Federal Communications Commission (FCC) until (a) an antitrust case pending in this Court since 1967 is tried by a jury, and (b) the FCC complies with United's request for public documents pursuant to the Freedom of Information Act (5 U.S.C. § 552). A hearing on the motion was held February 11, 1974, but only oral argument was heard as counsel contended that only legal issues were being contested. An accelerated briefing schedule was fixed and final reply briefs were received by the Court on February 16, 1974.

HISTORY

On March 2, 1967, Radio Hanover, Inc., (Radio Hanover) brought an antitrust action under the Sherman and Clayton Acts against United and other defendants in which all defendants were charged with combining and conspiring to monopolize cable television services in the Borough of Hanover, Pennsylvania. Succinctly stated, the history of that case is as follows: Prior to 1967, Radio Hanover and several other firms sought a franchise from the Borough of Hanover to construct and operate a cable television system. The franchise was ultimately granted to Radio Hanover and Penn-Mar CATV, Inc., a firm specially created for that purpose by several of the other applicants. One of those applicants was United Transmission, Inc., a subsidiary of United Utilities, Inc., which is also the parent of United Telephone, the plaintiff here and a defendant in the antitrust matter. Since one of the restrictions placed by the Borough of Hanover on the grant of the franchise was that no new utility poles could be erected, Radio Hanover sought permission from United to attach its coaxial cable system to United's already existing telephone poles. United refused, offering instead to construct the coaxial cable system and then to rent space on the cable to Radio Hanover for the transmission of its signals. Noting the possible future uses to which coaxial cable may be put, Radio Hanover on March 2, 1967 filed its antitrust complaint in this Court, alleging violations of Section 2 of the Sherman Act, 15 U.S.C. §§ 2, and Sections 4, 12 and 16 of the Clayton Act, 15 U.S.C. §§ 15, 22 and 26 against United, United Utilities, Inc., United Transmission, Inc., Penn-Mar CATV, Inc. and the other firms which had joined in the creation of Penn-Mar, CATV, Inc.

Soon after the filing of the antitrust complaint, United moved to have the antitrust proceedings stayed on the grounds that primary jurisdiction over the matters asserted in the complaint rested with the FCC.¹ By Memorandum and Order of this Court, filed October 2, 1967, United's motion was denied, this Court noting that the FCC at that time had not yet determined whether it would assume jurisdiction over cable attachments. Although United was placed on notice that any further construction of its cable system without a § 214 certificate (47 U.S.C. § 214) would be at its own risk (Memorandum of Oct. 2, 1967, P. 6), United completed its system. In addition, Radio Hanover's motion for a preliminary injunction was denied, Radio Hanover, Inc. v. United Utilities, et al., 273 F.Supp. 709 (M.D.Pa.1967), and motions by plaintiff and defendants to dismiss claims and counterclaims were also denied.

Further, on May 15, 1967, Radio Hanover brought suit against United alone (Civil No. 9994) in which plaintiff sought injunctive relief to prevent defendants from constructing any CATV facilities in the Hanover area until United either secured a certificate of public convenience and necessity as required by 47 U.S.C. § 214 or was exempted from this requirement by the FCC. Plaintiff's motion for summary judgment and defendants' motion to dismiss were denied and the parties were urged to accelerate discovery as the Court was ready to try the case immediately.

The docket sheets reveal very little activity by any of the parties from July, 1968 to June 10, 1971, when both cases were called for pretrial conference by the Court. In all fairness, there was reason for this hiatus inasmuch as, in the meantime, the Commission has assumed jurisdiction over Cable Television and the issue of whether United was required to seek a certificate under § 214 was being actively pursued there. The Justice Department was also considering whether an antitrust suit should be commenced by the Government against United, et al., and plaintiff held off in hopeful anticipation that this would occur, but it did not. Mindful of these factors which were transmitted to the Court by counsel, the Court assumed, in light of the joint inactivity, that the matter would be resolved without any further litigation here. However, after phone conversations with counsel revealed that a trial might be necessary, the cases were listed for pretrial conference on June 10, 1971, at which time Radio Hanover agreed to move for a voluntary dismissal in Civil No. 9994 and both parties represented that they would move with dispatch in order to bring the case to trial promptly. Subsequent to this, substantial discovery was undertaken and, more recently, United pressed strenuously for completion of discovery and trial on the merits.

On June 25, 1968, the FCC overruled its prior decision in Capital City Telephone Co., 3 F.C.C. 189 (1936), and decided that Telephone Companies, such as United, required a § 214 certificate for the construction of its system. General Telephone Company of California, 13 F. C.C. 2nd 448 (1968). Pursuant to that decision, United filed a § 214 application with the FCC on November 26, 1969. On January 20, 1970, Radio Hanover filed a petition to reject United's application, alleging that United sought to monopolize cable television in the Borough of Hanover. Meanwhile the proceedings before the Commission continued and, by Memorandum and Order of March 29, 1973, the FCC designated the application matter for a hearing, to determine, among other things:

"Whether United Telephone Company of Pennsylvania, in connection with the provision of cable television service in the Hanover, Pennsylvania, area has engaged in any practices which are: (a) anti-competitive or monopolistic; or (b) contrary to the public interest standards of the Communications Act; or (c) in violation of any rule, decision, or policy of the Federal Communications Commission."

By order of the same date, March 29, 1973, FCC's Administrative Law Judge (ALJ) scheduled the § 214 hearing for June 11, 1973. That hearing was not convened,² and by order of the ALJ, released November 12, 1973, the hearing was reset for February 19, 1974.

On May 31, 1973, United sought the identification of documents relating to the detailed "facts" set forth in the designation order of March 29, 1973. United charges that each of its efforts to secure the documents have been rebuffed by the FCC under a general claim of "exemption". In addition, United alleges that the FCC has refused to "identify" any of the documents supposedly exempt from disclosure. Thus, on June 27, 1973, United moved ALJ for an order to compel identification of the documents. That motion was opposed by the two FCC bureaus which were designated as parties in the § 214 hearing, the Common Carrier Bureau and the Cable Television Bureau. United's motion was denied by a memorandum and order of the ALJ, released September 17, 1973. Thereafter, on November 2, 1973, United served a Freedom of Information Act request on the ALJ. By memorandum and order of January 9, 1974, the ALJ again denied United's request. By affidavit hand-carried to this Court on February 16, 1974, United has informed the Court that "By order released February 15, 1974, the FCC's Review Board dismissed United's request for the production of Freedom of Information documents on the ground that the Administrative Law Judge's denial of such documents was not appealable as of right." (emphasis in the original)

FREEDOM OF INFORMATION CLAIM

Under Section 552(a)(3) of the FIA, 5 U.S.C. § 552(a)(3),

"the district court of the United States in the district in which the complainant resides, or has his principal place of business, or in which the agency records are situated, has jurisdiction to enjoin the agency from withholding agency records and to order the production of any agency records improperly withheld from the complainant. In such a case the court shall determine the matter de novo and the burden is on the agency to sustain its action."

At the outset, the FCC contends that Congress, by specifying the remedies available to a complainant under the FIA, meant to preclude this Court from exercising its traditional equitable powers to enjoin an ongoing agency proceeding. Porter v. Warner Holding Co., 328 U.S. 395, 66 S.Ct. 1086, 90 L.Ed. 1332 (1945); United States v. Babcock, 250 U.S. 328, 39 S.Ct. 464, 63 L.Ed. 1011 (1919). Neither case is in point. Rather, I am in accord with the reasoning espoused in Bannercraft Clothing Company v. Renegotiation Board, 155 U.S. App.D.C. 174, 466 F.2d 345 (1972), where the Court, after studying the legislative history behind the FIA, concluded that since the Act was designed to afford litigants, as well as members of the public, access to agency information, stays of ongoing administrative proceedings may be necessary to...