Measuring the nexus: the relationship between minority ownership and broadcast diversity after Metro Broadcasting.

• Author: Hammond, IV, Allen S.

1. INTRODUCTION

   In Metro Broadcasting, Inc. v. FCC,(1) the Supreme Court found that the federal government had a compelling interest in promoting the diversity of viewpoints via broadcasting. In addition, the Court found that ownership of broadcast stations by minorities promoted the government's compelling interest. The decision of the Court in Adarand Constructors, Inc. v. Pena(2) overruled the Metro Broadcasting Court's use of intermediate scrutiny to analyze the constitutionality of the federal government's race-based ownership programs but not Metro Broadcasting's finding of a nexus between minority ownership and diversity of viewpoint.(3) However, the recent Lutheran Church-Missouri Synod v. FCC(4) decision dismissed the government's arguments that a nexus exists between minority employment in broadcast stations and greater diversity in broadcast programming, and that the government has an interest in fostering such diversity.(5) The Federal Communications Commission (FCC or Commission) has consistently argued that a nexus exists between minority employment and viewpoint diversity, and that minority employment promotes minority ownership. Similarly, the Commission has argued that a nexus exists between minority ownership and viewpoint diversity.(6) Consequently, it is fair to say that the Lutheran Church opinion may be read to call into question the nexus between equal employment opportunity and diversity and, by implication, the nexus between ownership and diversity as well.

   The empirical data and findings upon which the Metro Broadcasting Court relied are found in the FCC-initiated survey and the Congressional Research Service's (CRS) analysis thereof. Subsequent to Metro Broadcasting, little research has been conducted to ascertain whether a nexus exists. Thus, at present, the FCC survey data and the CRS findings constitute the primary data and analysis upon which the Metro Broadcasting Court's findings rest. However, given the challenge of the Lutheran Church opinion and potentially significant changes in the regulation and operation of the broadcast market, sole reliance on Metro Broadcasting's holdings may be ill advised, and a new study documenting the continued existence of the nexus may be warranted. Moreover, a new study could expand upon the issue that the CRS study and the studies that build upon its findings were unable to reach.

2. THE CASE LAW

   1. Lutheran Church Opinion

   In its Lutheran Church opinion, a unanimous circuit court panel expressed substantial skepticism that a nexus exists between minority employment and viewpoint diversity. The circuit court specifically stated:

   The Commission has unequivocally stated that its EEO regulations rest solely on its desire to foster "diverse" programming content.... The Commission never defines exactly what it means by "diverse programming." ... The government's formulation of the interest seems too abstract to be meaningful.(7) .... Justice O'Connor's ... dissent in Metro Broadcasting, which described the government's interest as "certainly amorphous," protested: "The FCC and the majority of this Court understandably do not suggest how one would define or measure a particular viewpoint that might be associated with race, or even how one would assess the diversity of broadcast viewpoints."(8) Regarding the argument that Metro Broadcasting retains viability as precedent for the assertion that the government has an interest in fostering diversity, the circuit court stated that:

   [A]lthough Metro Broadcasting's adoption of intermediate scrutiny was overruled in Adarand, its recognition of the government interest in "diverse" programming has not been disturbed by the Court. The government thus argues that we are bound by that determination. We do not think that proposition at all evident. Even if Metro Broadcasting remained good law in that respect, it held only that the diversity interest was "important." We do not think diversity can be elevated to the "compelling" level.... It is true that the Court, denying that the supposed "link between expanded minority ownership and broadcast diversity rest[s] on impermissible stereotyping," thought the Commission and Congress had produced adequate evidence of a nexus between minority ownership and programming that reflects a minority viewpoint. Yet the Court never explained why it was in the government's interest to encourage the notion that minorities have racially based views.(9) B. The Metro Broadcasting Dissent and the Current Supreme Court

   The dissent in Metro Broadcasting found no "credible" nexus between ownership and diversity.(10) It also explicitly challenged the assertion that the FCC or Congress had ever successfully established the existence of a nexus.(11) Finally, the dissent argued that the market controls expression by ownership even if a minority owner might prefer to program differently.(12)

   Regardless of whether the current majority would view an FCC initiative to create a revised minority ownership policy as exclusively raising Fifth Amendment due process concerns or both due process and First Amendment concerns, the establishment of a demonstrable, quantifiable nexus is critical to FCC and/or congressional efforts to justify the policies. First, the members of the Metro Broadcasting dissent are now part of the majority of the Court. Second, reliance on the prior studies leaves the policies' advocates with little empirical evidence addressing the actual impact of market and regulatory changes on minority broadcasters.

3. BROADCASTING MARKET CHANGES

   There have been significant changes in the broadcast market since Metro Broadcasting was decided based on, inter alia, the CRS study in the late 1980s. It has been forcefully asserted that the FCC authored deregulatory policies,(13) including relaxation of the multiple ownership(14) and the duopoly rules, as well as creation of the Local Market Agreements (LMA) policy(15) have affected the ability of minority and majority broadcasters to compete.(16) These changed circumstances are problematic in that it is not known how they may have affected programming decisions and the diversity of available programming choices.(17) However, it is known...