Prometheus Radio Project v. FCC (Prometheus III).

• Author: Schatz, Bryan
• Position: Broadcast ownership

PROMETHEUS RADIO PROJECT V. FCC (PROMETHEUS III)

824 F.3d 33 (3d Cir. 2016)

In Prometheus Radio Project v. FCC, (1) petitioners challenged the FCC's definition of the "eligible entity," a status bestowed upon certain applicants for broadcast ownership to promote female and minority ownership. Petitioners also challenged the entirety of the FCC's quadrennial review of ownership broadcast rules, as well as the FCC's rule regarding television joint sales agreements.

1. BACKGROUND

   The FCC is directed to promote minority and female broadcast ownership (2) and attempts to promote this goal by providing preferences for "eligible entities." (3) This is the third in a line of cases (4) in which the Third Circuit has analyzed FCC ownership rules and the Telecommunications Act's mandate for the Commission to perform quadrennial reviews of these rules. (5)

   In this case, several broadcasters and a non-profit organization individually filed petitions for review of a 2014 FCC Further Notice of Proposed Rulemaking, (6) challenging the agency's delay in defining an eligible entity and a related attribution rule for television joint sales agreements. (7) Petitioners argued that the current eligible entity definition has failed to provide any benefit to ownership groups of women or minorities. (8) The FCC had employed revenue-based criteria to help classify eligible entities. (9)

2. ANALYSIS

   The Court first discussed how the previous Prometheus decisions had affected the eligible entity definition. (10) For example, in Prometheus II, the Court had found that the FCC's revenue-based criteria for categorizing "eligible entities" was insufficient. (11) The Court then applied the its test for determining whether an agency's action has been "unreasonably delay[ed]"12 and found that because (1) it has taken the FCC over a decade to settle on new criteria to define eligible entity; (13) (2) the statutory importance of minority and female broadcast ownership is very high; (14) (3) without a set eligible entity definition, several other FCC initiatives cannot occur; (15) and (4) because the FCC does not have a strong reason for its continued delay, (16) there has been an unreasonable delay in the FCC's finalization of its eligible entity definition. (17) After agreement from both parties, the court determined that a mediation will occur, which will set a schedule for when the FCC must finalize its eligible entity definition with no further delays. (18)

   Next, the court...