Time Warner Cable Inc. v. Federal Communications Commission
729 F.3d 137
2d Cir.2013Background
- In 2011 the FCC promulgated revised program-carriage rules under 47 U.S.C. § 536(a)(3), (5) (the "program carriage regime") and a new "standstill" rule that can temporarily maintain existing carriage terms while a complaint is pending. Petitioners: Time Warner Cable and NCTA. Respondent: FCC/United States.
- The program-carriage regime targets affiliation-based discrimination by MVPDs (cable, DBS, telco providers) that could "unreasonably restrain" unaffiliated video programmers' ability to compete. The 2011 rules clarified the prima facie standard (direct or circumstantial evidence; "similarly situated" analysis) and added procedures for enforcement.
- The standstill rule allows temporary continuation of preexisting contract terms pending resolution, subject to preliminary-injunction-type factors. The FCC treated the rule as procedural and argued it was a logical outgrowth of a 2007 NPRM.
- Petitioners challenged (1) the program-carriage regime as a First Amendment violation (claiming content- and speaker-based regulation requiring strict scrutiny), and (2) the standstill rule as promulgated without adequate notice-and-comment under the APA.
- The Second Circuit upheld the program-carriage regime under intermediate scrutiny but held the standstill rule violated APA notice-and-comment requirements and vacated that rule without prejudice to re-promulgation.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Appropriate First Amendment scrutiny for §616 program-carriage regime | Regime is content- and speaker-based (interferes with editorial choices and disfavors MVPDs), so strict scrutiny applies | Statute and FCC rules are content- and speaker-neutral (target affiliation-based discrimination, not message) | Intermediate scrutiny applies (content- and speaker-neutral) |
| Constitutionality of program-carriage regime under intermediate scrutiny | Even under intermediate scrutiny, regime is not narrowly tailored and is unjustified given increased competition | Regime serves important interests (fair competition; diversity) and is case-specific/narrowly tailored (requires proof of affiliation-based discrimination and anticompetitive effect) | Regime survives intermediate scrutiny; First Amendment challenge denied |
| Whether standstill rule required APA notice-and-comment | FCC promulgated substantive rule (affects contractual/substantive rights) without adequate notice; 2007 NPRM did not put parties on notice | Rule is procedural or at least a logical outgrowth of 2007 NPRM questions about anti-retaliation protections | Standstill rule is substantive, not adequately noticed; vacated for failure to comply with APA notice-and-comment |
Key Cases Cited
- Turner Broadcasting System, Inc. v. FCC, 512 U.S. 622 (1994) (plurality) (framework for content neutrality and intermediate scrutiny of certain broadcast/cable regulations)
- Turner Broadcasting System, Inc. v. FCC, 520 U.S. 180 (1997) (application of intermediate scrutiny to cable-related speech regulations)
- Citizens United v. Federal Election Commission, 558 U.S. 310 (2010) (speaker-based restrictions on political speech warranting heightened scrutiny)
- Miami Herald Publishing Co. v. Tornillo, 418 U.S. 241 (1974) (compelled access / right-of-reply principles)
- United States v. O'Brien, 391 U.S. 367 (1968) (intermediate-scrutiny test for content-neutral regulations of conduct with incidental effects on speech)
- Cablevision Systems Corp. v. FCC, 649 F.3d 695 (2d Cir. 2011) (circuit precedent on program-carriage and market-structure analysis)
- Comcast Corp. v. FCC, 579 F.3d 1 (D.C. Cir. 2009) (market-power and national vs. local market considerations)