Fcc v. Fox: Has the Supreme Court Sanctioned Political Influence in Agency Decision-making? - Catherine E. Bell

• Jurisdiction: United States,Federal
• Publication year: 2010
• Citation: Vol. 61 No. 2

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FCC v. Fox: Has the Supreme Court Sanctioned Political Influence in Agency Decision-making?

I. Introduction

Can agencies radically change policy simply because of a change in the White House? The United States Supreme Court's latest decision in FCC v. Fox Television Stations, Inc.¹ suggests that agencies can do exactly that. The Federal Communications Commission (FCC), an independent United States agency, regulates the content of U.S. broadcasting stations.² In 2002 and 2003, the FCC and Fox clashed when Fox aired two separate Billboard Music Awards (BMA) shows during which BMA guests uttered isolated expletives.³ Prior to these incidents, the FCC had never issued an indecency violation to a broadcaster for airing only isolated expletives.⁴ Nevertheless, the FCC issued a disciplinary order to Fox, finding such a violation.⁵ Fox petitioned for review by the United States Court of Appeals for the Second Circuit, which vacated and remanded the order because the FCC did not provide the fact-based "reasoned explanation" necessary for the policy change to meet the applicable arbitrary and capricious standard of review.⁶ After granting a writ of certiorari, the Supreme Court refined the reasoned-explanation requirement, holding that the FCC must only provide a subjective, reasoned explanation for its decision to meet the arbitrary and capricious standard of review.⁷ Pursuant to this refined reasoned-explanation test, the Court reversed the Second Circuit's decision.⁸ In doing so, the Supreme Court relaxed the requirement for when an agency changes policy, allowing increased executive influence in agency policy choices. Consequently, an agency's overall objective of serving the public interest may be hindered due to increased political influence in agency decision-making.

II. Legal Background

A. Judicial Authority to Review Agency Actions: The Administrative Procedure Act

Congress passed the Administrative Procedure Act (APA)⁹ in 1946, granting courts the authority to review agency action.¹⁰ Specifically, the APA grants courts authority to "compel agency action"¹¹ when agencies fail to act and to "hold unlawful and set aside agency action"¹² when the reviewing court finds the agency's action to be "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law."¹³ However, the APA does not expressly address how courts should review agency actions that reverse prior policy choices.¹⁴ Hence, in 1983 the Supreme Court addressed this issue.¹⁵

B. Motor Vehicle Manufacturers Ass'n of the United States, Inc. v. State Farm Mutual Automobile Insurance Co.

The Supreme Court faced the issue of the appropriate judicial standard of review for an agency's change in policy in the 1983 decision of Motor Vehicle Manufacturers Ass'n of the United States, Inc. v. State Farm Mutual Automobile Insurance Co.¹⁶ In that case, the Court reviewed the National Highway Traffic Safety Administration's (NHTSA) radical policy change for passive restraint systems.¹⁷ In 1977, during the Carter Administration, Secretary of Transportation Brock Adams implemented a regulation requiring automobile manufacturers to satisfy a passive restraint requirement by installing either automatic seatbelts or airbags into cars, and to complete the process by 1984. However, in 1981, shortly after President Reagan's inauguration, Secretary of Transportation Andrew Lewis rescinded the passive restraint requirement. Consequently, State Farm filed a petition requesting the United States Court of Appeals for the District of Columbia Circuit to review NHTSA's decision to rescind the passive restraint requirement. The court of appeals rendered a judgment for State Farm, holding that the NHTSA's change in policy was an arbitrary and capricious decision.¹⁸

In response, the Motor Vehicle Manufacturers Association petitioned for and was granted certiorari from the Supreme Court, which applied the arbitrary and capricious standard.¹⁹ In doing so, the Court held that to meet the arbitrary and capricious standard, the NHTSA had to provide a "reasoned analysis" for its change in policy.²⁰ The Court defined reasoned analysis as requiring the agency to show "a 'rational connection between the facts found and the choice made.'"²¹ In reviewing the NHTSA's reasons for changing its policy, the Court held that the NHTSA had not provided a reasoned analysis to meet the arbitrary and capricious standard ofreview, largely because the NHTSA failed to address its own prior factual findings.²²

Pursuant to the holding in State Farm, when an agency reverses a policy choice, the agency has to provide a reasoned analysis to survive arbitrary and capricious review.²³ The Court's decision in State Farm was also significant for another reason: the legal community largely understood State Farm as holding that agencies should derive their decisions based on their expertise and factual findings and not on political reasons.²⁴

C. The FCC's Regulation of Broadcasting Stations

Against this backdrop, the circumstances for FCC v. Fox Television Stations, Inc.²⁵ began to emerge. Prior to 1960, the FCC's authority to regulate broadcasting stations was limited because the Communications Act of 1934²⁶ expressly forbade the FCC from engaging in censor-ship.²⁷ In 1948 Congress enacted 18 U.S.C. Sec. 1464,²⁸ popularly known as the "indecency ban."²⁹ Entitled Broadcasting Obscene Language, the ban states in part: "Whoever utters any obscene, indecent, or profane language by means of radio communication shall be fined under this title . . . ."³⁰ However, the FCC was not authorized to penalize broadcasters under the indecency ban until Congress passed the Communications Act Amendments of 1960.³¹ Now, "[a]ny person who is determined by the Commission . . . to have . . . violated any provision of section . . . 1464 of title 18 . . . shall be liable to the United States for a forfeiture penalty."³² With this amendment, Congress delegated the FCC authority to sanction broadcasting stations for airing obscene, indecent, or profane language on the radio or TV.³³

In 1975 the FCC first exercised its authority granted in the Communications Act Amendments to sanction broadcasters for airing indecent speech.³⁴ The FCC's order in In re Citizen's Complaint Against Pacific Foundation Station WBAI (FM), New York, N.Y. (Pacifica Order)³⁵ arose from the broadcaster, Pacifica Foundation, airing George Carlin's "Filthy Words" monologue on a radio broadcast.³⁶ In "Filthy Words," Carlin intentionally repeated seven expletives as part of a satirical comedy routine.³⁷ This seminal Pacifica Order interpreted "indecent" content as that which:

is intimately connected with the exposure of children to language that describes, in terms patently offensive as measured by contemporary community standards for the broadcast medium, sexual or excretory activities and organs, at times of the day when there is a reasonable risk that children may be in the audience.³⁸

Using this definition, the FCC found that Pacifica's broadcast of "Filthy Words" was actionably indecent.³⁹ The FCC had not included repetition in its indecency definition⁴⁰ but noted that the monologue's use of "language with the words repeated over and over" supported its indecency finding.⁴¹ Pacifica appealed the FCC's order to the United States Court of Appeals for the District of Columbia Circuit, and the court of appeals overturned the order.⁴²

After the court of appeals reversed the FCC's indecency ruling, the FCC petitioned for certiorari from the Supreme Court.⁴³ In reviewing the FCC's interpretation of indecency, as the term appeared in the statutory indecency ban, the Court upheld the FCC's definition.⁴⁴ However, in upholding the FCC's definition, the Court refined the definition to require the repetitive use of words.⁴⁵ While repetition was a factor that the FCC had considered in the Pacifica Order,⁴⁶ the FCC had not included repetition in its indecency definition.⁴⁷ Yet the Supreme Court found the repetition factor important enough to be included in the indecency definition partly because repetition indicates that the speaker deliberately intended the language to be offensive.⁴⁸ In his concurring opinion, Justice Powell clarified that the Court's holding did "not speak to cases involving the isolated use ofa potentially offensive word."⁴⁹ Thus, the Court refined the definition of indecency in the indecency ban statute to require the repetition of expletives.⁵⁰

In 2001, after receiving numerous requests from broadcasters for clarification of their restrictions under the indecency ban, the FCC issued Industry Guidance on the Commission's Case Law Interpreting 18 U.S.C. Sec. 1464 & Enforcement Policies Regarding Broadcast Indecency (Industry Guidance Statement).⁵¹ This statement included "whether the material dwells on or repeats at length descriptions ofsexual or excretory organs or activities"⁵² as one of three principle factors that the FCC balances in determining whether language is patently offensive and, therefore, indecent.⁵³ Expanding on the repetition factor, the FCC identified numerous prior FCC decisions in which "[r]epetition of and persistent focus on sexual or excretory material [had] consistently [been] factors that exacerbate[d] the potential offensiveness of broadcasts."⁵⁴ Further, the FCC stated that "[i]n contrast, where sexual or excretory references have been made once or have been passing or fleeting in nature, this characteristic has tended to weigh against a finding of indecency."⁵⁵ The FCC also provided past instances when this fleeting nature weighed against a finding of indecency. For example, in L.M. Communications of South Carolina, Inc.,⁵⁶ the FCC found that the language "[t]he hell I did, I drove mother-fucker" was not indecent because "the 'broadcast contained only a fleeting and isolated utterance which, within the context of live and spontaneous programming, [did] not warrant a Commission sanction.'"⁵...