Waterway Communications Systems, Inc. v. F.C.C., 87-1488

• Decision Date: 21 September 1988
• Docket Number: No. 87-1488,87-1488
• Citation: 851 F.2d 401
• Parties: WATERWAY COMMUNICATIONS SYSTEMS, INC., Petitioner, v. FEDERAL COMMUNICATIONS COMMISSION and United States of America, Respondents, Riverphone, Inc., Intervenor.
• Court: U.S. Court of Appeals — District of Columbia Circuit

Page 401

851 F.2d 401

271 U.S.App.D.C. 146

WATERWAY COMMUNICATIONS SYSTEMS, INC., Petitioner, v. FEDERAL COMMUNICATIONS COMMISSION and United States of America, Respondents Riverphone, Inc., Intervenor.

No. 87-1488.

United States Court of Appeals District of Columbia Circuit.

Argued May 2, 1988.

Decided July 5, 1988.

As Amended Sept. 21, 1988.

Martin W. Bercovici, with whom Susan J. Pisner, Washington, D.C., was on the brief, for petitioner.

Gregory M. Christopher, Counsel, F.C.C., for respondents. Diane S. Killory, Gen. Counsel, Daniel M. Armstrong, Associate Gen. Counsel, John E. Ingel, Robert L. Cook, Counsel, F.C.C., Robert B. Nicholson and Laura Heiser, Attys., Dept. of Justice, were on the brief, for respondents.

Anne P. Jones and Robert J. Miller, Washington, D.C., entered appearances for intervenor Riverphone, Inc.

Before STARR and WILLIAMS, Circuit Judges, and WEIGEL, ^* Senior District Judge.

Opinion for the Court filed by Circuit Judge WILLIAMS.

WILLIAMS, Circuit Judge:

Waterway Communications System, Inc. ("Watercom"), a provider of ship-to-shore telecommunications, appeals the Federal Communications Commission's order rejecting its petitions to deny certain license applications of a competitor, Radio Television of Louisiana, Inc. ("RTL"). We dismiss for want of jurisdiction. The Commission's rejection of Watercom's petitions to deny the RTL license applications was not an appealable order; its ultimate grant of the RTL applications was appealable, but Watercom did not file its petition for review in this court within the 30-day statutory window following the grant.

I.

In the late 1970s Watercom developed technology for an "Automated Maritime Telecommunications System" or "AMTS." AMTS represents a leap ahead of prior systems, which did not allow customer dialing and which required a caller from shore to know the location of the ship he wished to call and the nearest public coastal station. Watercom's development and implementation of the AMTS technology threatened the interests of firms holding licenses for stations operating manual systems. An affiliated group of these licensees, of which RTL is a member, unsuccessfully contested Watercom's applications for frequencies on which to run an AMTS network. Watercom counterattacked on two fronts. First, it asked the Commission to investigate the conduct of RTL and its affiliates (especially Riverphone, Inc.), with an eye to imposition of sanctions. Second, it petitioned to deny several of RTL's pending public coast license applications on the theory that character flaws exhibited by members of its corporate family in their various challenges to Watercom should disqualify it from receipt of any FCC licenses.

On January 15, 1987 the Commission issued an order rejecting both aspects ofWatercom's counterattack. Its disposition of the generalized request for sanctions, however, is not before us; Watercom has limited its appeal to the Commission's treatment of its petitions to deny RTL's license applications. Reply Brief at 2-10; cf. Heckler v. Chaney, 470 U.S. 821, 105 S.Ct. 1649, 84 L.Ed.2d 714 (1985). Viewing the RTL group's actions in the context of the entire record, a "record ... replete with rancorous and ad hominem pleadings," Complaint of Waterway Communications System, Inc. against Riverphone, Inc., 2 FCC Rcd 241 (Joint Appendix (J.A.) 485), the Commission judged it innocent of material wrongdoing. Finding a hearing unnecessary, it rejected the petitions to deny and directed its staff to "process [the RTL] filings in the regular course of business." Id. On August 17, 1987, the Commission denied Watercom's petition for reconsideration of this decision. Complaint of Waterway Communications System, Inc. against Riverphone, Inc., 2 FCC Rcd 5012, J.A. 574.

On September 14, 1987, Watercom filed for review in this court pursuant to Sec. 402 of the Federal Communications Act, 47 U.S.C. Sec. 402 (1982). More than two weeks later, on October 2, the Commission's staff, acting on delegated authority, granted the RTL license applications. ¹

II.

There appear to be two ways of viewing Watercom's appeal to this court. The appeal may be from the Commission's denial of Watercom's petition to deny the RTL licenses, i.e., its decision that Watercom's challenges to the RTL applications did not warrant a hearing. That petition reached the end of the road when the Commission denied Watercom's petition for reconsideration on August 17, 1987. But, for the reasons discussed below and despite some suggestions to the contrary in our cases, the Commission's decision lacks finality and is not appealable.

On the other hand, this case may instead be characterized as a challenge to the grant of the RTL licenses on October 2, 1987. Commission orders granting radio licenses plainly are appealable under 47 U.S.C. Sec. 402(b). But Watercom's September 14, 1987 filing in this court did not fall within the 30-day jurisdictional window allowed by 47 U.S.C. Sec. 402(c) ².

A. Rejection of Watercom's Petitions to Deny

Jurisdiction for review of FCC licensing-related decisions is governed by Sec. 402(b). Sec. 402(b)(1)-(4) provide jurisdiction for appeals by parties affirmatively seeking Commission authorization, mostly described as "applicant[s]" for one thing or another; subsection (1) allows appeal by "any applicant for a ... station license, whose application is denied by the Commission." Sec. 402(b)(6) turns to the other side and authorizes appeal for persons situated as is Watercom--"any ... person who is aggrieved or whose interests are adversely affected by any order of the Commission granting or denying any application described in paragraphs (1)-(4)." (Emphasis added.) On its face, therefore, it appears that relief for Watercom under Sec. 402(b) requires as a trigger the grant or denial of a license application.

Although the Commission order rejecting Watercom's Petitions to Deny removed an impediment to the Commission's eventual grant of the RTL licenses, the order was not itself a final license grant. Nor did it irrevocably commit the Commission to granting the RTL licenses. In the denial the Commission directed its staff to "process" the RTL filings "in the regular course of business." This left the staff to assess RTL's technical submissions and make the statutorily required public interest finding. To treat the rejection of Watercom's petitions to deny as de facto a final decision to grant the RTL applications, as Watercom urges, would entangle the courts in disputes that have at least some chance of completely disappearing.

Resolution of petitions to deny a license application characteristically revolve around the Commission's duty to hold a hearing when the petition raises a sufficient question about the license application. See 47 U.S.C. Sec. 309(e). As Watercom asserts that its petitions to deny raised such an issue, it suggests that the order rejecting the petitions must be appealable. But the Commission's violation of Sec. 309, if its January and August 1987 decisions be such, can create a reviewable issue without constituting an appealable order. Watercom's impression to the contrary may well have derived from its reading some of our prior cases that loosely, and somewhat misleadingly, characterize appeals of the Commission's licensing decisions as appeals of the Commission's concurrent rejection of the appellants' petitions to deny. See, e.g., Metropolitan Television Co. v. United States, 221 F.2d 879, 880-81 (D.C.Cir.1955); Citizens for Jazz on WRVR, Inc. v. FCC, 775 F.2d 392, 393 (D.C.Cir.1985). The cases are properly characterized as appeals of Commission licensing decisions in which the primary issue on appeal was whether the Commission had violated the standards established by Sec. 309(e). Cf. Stone v. FCC, 466 F.2d 316, 321 (D.C.Cir.1972); Columbus Broadcasting Coalition v. FCC, 505 F.2d 320, 322 (D.C.Cir.1974). None of these cases even considered whether the Commission's Sec. 309 decisions could be independently appealable.

In a post-argument filing Watercom asserts that Fidelity Television, Inc. v. FCC, 502 F.2d 443 (D.C.Cir.1974), and Committee for Open Media v. FCC, 543 F.2d 861 (D.C.Cir.1976), are binding precedent for its view that a Commission order rejecting a Sec. 309(d) petition to deny without a hearing is independently appealable. We disagree. In Fidelity Television the court held final and appealable under Sec. 402(b) a Commission decision renewing RKO General's Los Angeles TV station but reserving its authority to upset that renewal if the results of an inquiry then pending in Boston (and relating to allegations of anticompetitive behavior by RKO) so dictated. The Commission's decision stated that "the application of RKO General, Inc.... IS DEEMED TO BE GRANTED, and ... the application of Fidelity Television, Inc.... IS DEEMED TO BE DENIED, subject to whatever action may be deemed appropriate following resolution of the matters" raised in the Boston proceeding. Id. 502 F.2d at 448. So far as appears, the qualification of the decision's finality was no more than what is inevitable under 47 U.S.C. Sec. 312(a)(2), which authorizes the Commission to revoke licenses "because of conditions coming to the attention of the Commission which would warant it in refusing to grant a license or permit on an original application."

Commission for Open Media v. FCC is closer but not on the mark. It arose from an objection by the Commission for Open Media ("COM") to the FCC's decision to renew Chronicle Broadcasting's TV license. On November 1, 1971 COM petitioned to deny Chronicle's application for renewal. The FCC rejected the substance of this petition in its May 9, 1973 decision to grant renewal. But that decision did not specifically mention the petition to deny, and the Commission formally rejected that petition only on May 30, 1973. In other words, what we would normally think of as the final decision--license renewal-- preceded...