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Appellate panel strikes down media-ownership restrictions

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  1. Content Restrictions

    NMU         D.C. CIRCUIT         Broadcasting         Feb 21, 2002    

Appellate panel strikes down media-ownership restrictions

  • Court deemed the FCC’s limits on the ownership of television stations to 35 percent of the national TV audience to be “arbitrary and capricious,” ordering the agency to reconsider such rules.

Combining five separate cases challenging the validity of federal restrictions on media ownership, the U.S. Circuit Court of Appeals in Washington, D.C. (D.C. Circuit) on Feb. 19 ordered the Federal Communications Commission to reconsider limits on television station purchases.

The decision also struck down an FCC regulation that forbade cable operators from owning television stations.

The FCC must now review its rule on ownership limits and either eliminate it, alter it or justify it. Chairman Michael Powell, for one, has openly discussed his desire for fewer regulations of the broadcast industry.

The ruling potentially removes considerable obstacles hindering large media companies from buying more and more television stations. For example, cable operator AOL Time Warner could then consider or even purchasing an entire broadcast network. The change would also allow CBS and Fox, both of which operate near the limit, to buy more stations.

The unanimous opinion from the three-judge panel addressed two regulations — one limiting the number of television stations that can be owned by the networks and another one restricting cable-broadcast cross-ownership. Fox, CBS and NBC all challenged the regulations, saying they violated their First Amendment free-speech rights.

The court vacated the cross-ownership rule “because we think it unlikely the commission will be able on remand to justify retaining it.”

But the court remanded the rule limiting the ownership of television stations to 35 percent of the national TV audience back to the FCC for reconsideration. Chief Judge Douglas wrote in the opinion that the rule “was arbitrary and capricious and contrary to law.”

The court, however, did not hold that the rules violated First Amendment principles. Instead, it said the FCC violated the Administrative Procedure Act, which requires the agency to show justification for its decisions.

(Fox Television v. FCC) PT

© 2002 The Reporters Committee for Freedom of the Press

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