Reassessing Turner and litigating the must-carry law beyond a facial challenge.

• Author: Warner, R. Matthew

1. INTRODUCTION II. MUST-CARRY'S PURPOSE A. Cable Becomes a Threat to Broadcasting B. FCC. Attempts to Protect Local Broadcasting from Cable C. Objections to the Must-Carry Provisions D. Road to the Modern Must-Carry Law: Century Communications and the Cable Television Consumer Protection and Competition Act of 1992 1. The Case that Caused Congressional Intervention: Century Communications v. FCC 2. Congress Writes the Must-Carry Rules: The Cable Television Consumer Protection and Competition Act of 1992 III. THE TURNER DECISIONS A. Turner I B. Turner I on Remand to the District Court C. Turner II IV. TURNER REASSESSED: FIRST AMENDMENT LITIGATION OF THE MUST-CARRY RULES A. Turner was a Facial Challenge B. Facial Challenge Jurisprudence: Res Judicata from the Turner II Decision Will Not Preclude As Applied Challenges to the Must-Carry Law C. How Advancing Technology is Undermining Turner's Premise: Must-Carry Applied to Markets with Multiple Cable Equivalent Services is Constitutionally Inappropriate 1. A Competitive Market Can Achieve the Governmental Ends Without the Must-Carry Law. 2. Addressing the Opposition V. CONCLUSION I. INTRODUCTION

   In recent decades, the must-carry rules have had a troubled constitutional history. After two sets of rules were struck down by the D.C. Circuit for violating the First Amendment rights of both cable operators and cable programmers, Congress revised the Federal Communications Commission ("FCC") rules in the Cable Television Consumer Protection and Competition Act of 1992 ("1992 Cable Act"). (1) In 1997, the Supreme Court determined that the must-carry law was constitutional under an intermediate scrutiny test. (2) The Court's decision was ultimately based on the determination that Congress relied on substantial evidence when inferring that broadcasters would be hurt without the must-carry rules. However, does the Turner II (3) decision preclude further First Amendment challenges to the must-carry rules?

   This Note argues that the answer is no and that the time is drawing near for new challenges. Because the must-carry rules were facially challenged in the Turner decisions, no party is precluded from challenging the rules as applied. Although subsequent challengers of the must-carry law have the burden of overcoming the deference afforded to Congress's findings, this should be possible. In many markets, the central premise to Congress's findings--cable will abuse its market power by behaving anticompetitively toward broadcasting--is no longer or increasingly less possible. After all, Turner I (4) established that a harm must actually be proven, and Turner II merely established that Congress' findings were sufficient to withstand a facial application of First Amendment scrutiny.

   This Note has four subsequent Parts. Part II will provide background on the birth of the must-carry rules. Part III will discuss the Turner decisions. Part IV will discuss must-carry rules today and the impact of the Turner decisions on future litigation. Part V concludes the Note.

2. MUST-CARRY'S PURPOSE

   A. Cable Becomes a Threat to Broadcasting

   The must-carry provisions are as old as the initial attempts to regulate cable, which began when cable was first perceived as a threat to broadcasting. Cable was first used in the 1940s as a means to facilitate broadcasting. (5) Because broadcast waves reflect off of mountains, (6) instead of bending around them, individuals living in mountainous areas had a difficult time receiving broadcast signals. In order to solve this problem, large antennae were placed on mountain tops, and cables were run from the head end, (7) where the broadcast signals from an antenna were "collected," to people's homes in the surrounding communities. (8) This was the beginning of Community Antenna Television ("CATV"). (9) Because CATV was the only means for these individuals to receive broadcast signals, broadcasters welcomed CATV for the additional viewers it provided. (10) Because, on the whole, CATV was not perceived as a direct threat to broadcasting, FCC refused to regulate the cable industry in the late 1950s. (11)

   Broadcasters' and the FCC's perceptions of cable began to change in 1961 when a cable operator began to serve the San Diego area, (12) an area that broadcasters had little trouble servicing. (13) The San Diego cable antenna picked up signals from as far as one hundred miles away, which meant that Los Angeles's content could be retransmitted to the San Diego community. (14) In addition to retransmitting distant signals otherwise unobtainable by San Diego viewers, cable offered better picture clarity than over-the-air reception. (15) Consequently, the three independent VHF stations in San Diego were no longer competing just against each other for viewers but also against the four Los Angeles stations. Because the increased competition to local broadcasters would fragment the audience--and therefore broadcasters' advertising revenue--cable was now an economic threat to broadcasting. (16)

   B. FCC Attempts to Protect Local Broadcasting from Cable

   Carter Mountain Transmission Corporation (17) is often cited as the beginning of must-carry obligations. (18) This was a 1962 ease dealing with a CATV provider's attempt to gain permission to carry distant signals. (19) The FCC denied Carter Mountain Transmission Corporation permission to recast broadcast signals until the company could show that the imported signals would not duplicate the programming of the local broadcast station. (20)

   Not long after the D.C. Circuit upheld the FCC's jurisdiction to deny the retransmission of broadcast signals, (21) the FCC was formally petitioned by broadcasters to implement regulations on cable systems. (22) Because the 1934 Communications Act gave the FCC the jurisdiction to regulate the air waves, (23) the FCC believed that it could regulate cable since doing so would be sufficiently ancillary to the FCC's broadcasting authority. (24) In addition to ensuring the survival of the present broadcast structure and UHF stations, the FCC believed that regulation of cable was important to maintain fairness to broadcasters. (25) After all, CATV systems were retransmitting signals that they received for free over the air. Broadcasters, on the other hand, had to pay considerable sums of money to produce and air the content in the first place. (26)

   In 1966, the FCC conducted its Economic Inquiry Report, (27) which was an analysis of the economic relationship between cable and broadcast. In the Report, the FCC admitted that it lacked sufficient data to predict cable's impact on broadcast. (28) However, the scenario described by ABC and other broadcasters--that cable may hurt the public interest by leading to the death of many broadcast stations (29)--seemed like a growing reality. (30) As a consequence, in order to ensure that broadcasters were carried by the CATV without being duplicated, the FCC asserted jurisdiction over CATV to protect broadcasters. Later, the must-carry regulations would make official the safety mechanism that ensured broadcasters would not be shutout by cable companies' bottleneck technology. (31)

   C. Objections to the Must-Carry Provisions

   The FCC's actions received criticism from cable advocates in the following decades. One critic of the FCC's actions toward cable contended that "[t]here is considerable evidence that the Commission has been more concerned with protecting the economic interests of conventional broadcasters than with fully exploiting the resources of cable technology." (32) In 1980, Turner Broadcasting Systems, a cable programmer that had its programming displaced by the must-carry regulations, petitioned the FCC to eliminate the regulations. (33) The petition alleged that the must-carry rules violated the First Amendment rights of cable programmers, cable operators, and the viewing public. (34) Although the FCC denied Turner's appeal, the FCC conceded that the must-carry rules deprived cable programmers access to some audiences and that the compelled carriage of broadcast signals displaces alternate programming for cable's subscribers. (35)

   In Quincy Cable TV v. FCC, the D.C. Circuit struck down the FCC's must-carry rules under the O'Brien test. (36) The rules at issue in Quincy Cable TV were very stringent compared to the current rules. Without any regard to a cable system's capacity, they required, inter alia, mandatory carriage of both all broadcast signals in the local market and all significantly viewed commercial broadcast stations. (37)

   Under the O'Brien test, according to the Quincy Cable TV court, regulations are invalid if they do not serve a substantial government interest or are more intrusive than necessary to serve that interest. (38) The Quincy Cable TV court believed that the must-carry regulations violated both parts of this test. Because the rules could not pass the O'Brien test, the court reasoned that there was no need to consider whether a stricter First Amendment test was necessary. (39)

   The court believed that the issue of whether there was a substantial government interest at stake was largely an empirical matter. According to the court, there were three fact-based, empirical grounds upon which the FCC rules violated the First Amendment. (40) First, because a governmental restriction of speech must be narrowly tailored to achieve its ends, data needs to exist showing that the regulated technology is in fact a threat to what the government seeks to protect. (41) In the present case, the FCC needed data showing conclusive evidence that cable would inevitably pose a threat to local broadcasting, warranting regulation. Instead of this evidence, the FCC's finding that cable was not a threat to local broadcasting from its 1966 Economic Inquiry Report (42) and subsequent Notice of Proposed Rulemaking (43) undercut the FCC's case. (44)

   The second empirical deficiency of the FCC's position regarded the A/B switch, (45) which would...