WH LINK, LLC v. City of Otsego
| Decision Date | 01 July 2003 |
| Docket Number | No. C7-02-2062.,C7-02-2062. |
| Citation | 664 N.W.2d 390 |
| Parties | WH LINK, LLC, Relator, v. CITY OF OTSEGO, Respondent. |
| Court | Minnesota Court of Appeals |
Mark J. Ayotte, Philip R. Schenkenberg, Briggs and Morgan, P.A., St. Paul, for relator.
James J. Thomson, Robert J.V. Vose, Kennedy & Graven, Chartered, Minneapolis, for respondent.
Kathleen A. Marron, Robins, Kaplan, Miller & Ciresi L.L.P., Minneapolis, for amicus curiae, Minnesota Cable Communication Association.
Gary A. Van Cleve, Larkin, Hoffman, Daly & Lindgren, Ltd., Bloomington; and Paul Glist (pro hac vice), Cole Raywid & Braverman, L.L.P., Washington, DC, for amicus curiae, Charter Communications, Inc.
Susan L. Naughton, League of Minnesota Cities, St. Paul, for amicus curiae, League of Minnesota Cities.
Considered and decided by LANSING, Presiding Judge, PETERSON, Judge, and WRIGHT, Judge.
This appeal involves a dispute between a city and a telecommunications carrier over whether the carrier must comply with state-law requirements governing cable-television systems in order to provide video programming to its local telephone customers over an open-video system. The city approved the carrier's application for a cable franchise, conditioned on the carrier's acceptance of a service-area requirement under the "level playing field" provision of the Minnesota cable statute. Believing that condition to be illegal as applied to its proposed open-video system, the carrier appealed to this court for certiorari review of the city's decision. Because we conclude that the challenged state-law requirements apply to the carrier's open-video system, we affirm.
In 2000, WH Link, LLC, (WHL) received authorization from the Minnesota Public Utilities Commission to provide local telephone service in areas including the City of Otsego. With that authorization, and in compliance with the city's right-of-way ordinance, WHL installed network facilities and began providing local telephone and Internet services within the city. The network, constructed with copper and fiber optic wire, has the capacity simultaneously to carry telephone, Internet, and video signals.
In order to add video programming to its services, WHL filed an application in April 2001 with the Federal Communications Commission (FCC) for certification to operate an open-video system (OVS). After the FCC approved the application, WHL filed with the FCC a notice of intent to establish an OVS in Otsego and several other communities. At that time, Charter Communications Holding Co., LLC, (Charter) provided cable television service in the city under an extension permit.
After filing its notice of intent, WHL met with city officials to discuss WHL's plan to begin providing video programming in the city. The city took the position that WHL would have to obtain a cable franchise to provide OVS service. WHL disagreed, contending that the state-law franchise requirement was preempted by federal laws establishing the OVS regulatory framework. In December 2001, after no resolution had been reached, WHL informed the city that it would begin providing video programming in compliance with federal law over its OVS system in January 2002. After further negotiations, WHL agreed to apply for a cable franchise under state law, subject to a reservation of its "rights under applicable law." In its franchise application, WHL asserted that it was exempt from state-law service-area requirements and affirmed that it sought "authorization to provide cable services over its open video system in its federal `telephone service area,' without being obligated to go beyond that service area through the imposition of any specific build-out or line-extension obligations."
The city initiated the statutory cable franchising application process in March 2002, and both WHL and Charter applied for franchises. (Charter's extension permit was to expire at the end of 2002.) Charter proposed a service area comprising all incorporated areas of the city with a density of nine homes per quarter mile. WHL proposed initially to serve a smaller area of the city—five residential subdivisions in which it was already providing local telephone and Internet service—but indicated it would continue to expand its network so that its video service would be available to more city residents in the future.
After holding a public hearing and considering written comments of the applicants, in October 2002 the Otsego City Council adopted resolutions approving Charter's franchise application and conditionally approving WHL's application, subject to WHL's acceptance of a service-area requirement. Specifically, the city's draft franchise ordinance required WHL to extend its OVS service within seven years to all areas of the city with a dwelling density of nine homes per quarter mile. WHL rejected the service-area requirement and informed the city that it viewed the imposition of the requirement as effectively denying its franchise application. This appeal followed.
an open-video system operated by a local exchange carrier?
Decisions of administrative agencies, including cities, are presumed correct, and we will reverse or modify an agency decision only if it prejudiced a party's substantial rights because it exceeded the agency's statutory authority, was made upon unlawful procedure, was affected by other error of law, or was arbitrary or capricious. See Minn.Stat. § 14.69 (2002) (). In considering questions of law, "reviewing courts are not bound by the decision of the agency and need not defer to agency expertise." St. Otto's Home v. Minnesota Dep't of Human Servs., 437 N.W.2d 35, 39-40 (Minn.1989) (citations omitted). Statutory construction is a question of law subject to de novo review. Brookfield Trade Ctr., Inc. v. County of Ramsey, 584 N.W.2d 390, 393 (Minn.1998).
Minn.Stat. § 238.02, subd. 3 (2002).
WHL does not argue that an open-video system is not a "cable communications system" for the purposes of the cable-franchise requirement. Rather, it contends that the legislature excluded cable services provided by telecommunications carriers from the franchise requirement when it adopted certain legislative amendments in 1997.1 That year the legislature amended chapter 237, which regulates telephone, telegraph, and telecommunications operations, to add provisions governing the use and regulation of public rights-of-way. See 1997 Minn. Laws ch. 123, §§ 3-4. One of the new provisions prohibits local governments from "requir[ing] a telecommunications right-of-way user to obtain a franchise or pay for the use of the right-of-way." Id. at § 4 (). WHL contends that because it is a telecommunications carrier that uses the right-of-way, section 237.163 prohibits the city from requiring it to obtain a franchise for its OVS operation under chapter 238. WHL overlooks, however, that "telecommunications right-of-way user" is a term of art, which is defined by statute to exclude "cable communication systems":
`Telecommunications right-of-way user' means a person owning or controlling a facility in the public right-of-way * * * that is used or is intended to be used for transporting communications or other voice or data information. A cable communication system defined and regulated under chapter 238 * * * [is] not [a] telecommunications right-of-way user[ ] for the purposes of * * * section 237.163.
Minn.Stat. § 237.162, subd. 4 (2002) (emphasis added). Therefore, if WHL's open-video system is a "cable communications system" under chapter 238, section 237.163, subd. 7(a)(4), would have no effect on the city's obligation to require it to obtain a franchise under chapter 238.
According to WHL's franchise application, its open-video system would receive television and other video programming by satellite, and would distribute programs by copper and fiber-optic wire to residential subscribers. Because such a system satisfies the statutory definition of "cable communications system" set out in section 238.03, and because a "cable communications system" is not a "telecommunications right-of-way user" exempted from the municipal right-of-way franchise authority, we conclude that the city did not err in requiring WHL to obtain a cable franchise for its open-video system.
WHL argues that federal law preempts both the application of the chapter 238 cable-franchise requirement to an open-video system and the city's imposition of a service-area requirement on WHL's proposed OVS operation.
The city contends that this court does not have jurisdiction to decide WHL's preemption claims because the claims amount to a collateral attack on two final FCC orders, over which federal appellate courts have exclusive jurisdiction. The first of the orders referred to by the city is an FCC order amending its OVS rules; the...
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Clear Channel Outdoor, Inc. v. City of Arden Hills, No. A08-1388 (Minn. App. 4/28/2009)
...matters not raised and decided in prior proceedings. Thiele v. Stich, 425 N.W.2d 580, 582 (Minn. 1988); see WH Link, LLC v. City of Otsego, 664 N.W.2d 390, 393 n.1 (Minn. App. 2003) (noting application of Thiele to "proceedings before the city council"), review denied (Minn. Sept. 13, 2000)......