American Broadcasting Co. v. United States

Bеfore CLARK, Circuit Judge, and LEI- WEINFELD, BELL and Judges. District LEIBELL, Judge. District These three actions were instituted August enjoin and set or- aside an der of the Federal Communications Com- mission adopting interpretative certain rules of the Commission in “give- relation to away” programs on radio and television.1 of this three-judge is. court Jurisdiction based on the of the Federal Act, Communications 402(a) 47 U.S.C.A. § and the United Judiciary States and Ju- Act, dicial Procedure T. 28 U.S.C. §§ 1398 and 2284. right judicial to a re- view of the action of the Federal Communi- cations Commission is also by the asserted plaintiffs under Section 10 of the Admin- istrative Procedure Act. 5 U.S.C.A. § 1009. City, Cravath, Zorbaugh, G. B. New York report Commission, released Moore, City (Alfred & Swaine New York August 19, 1949, is entitled “In the Matter McCormack, George B. Turner and Charles Promulgation of Rules Governing Broad- Myneder, counsel), City, for New York states, Lottery cast of Information” Co., Broadcasting American Inc. in its opening paragraphs that:— Cahill, Gordon, Zachry Reindel, New & “The Commission has this day de- Williams, City Gustav (Paul York W. B. adopt termined to interpre- the attached B. Dudley E. Margraf, Thomas Ervin rules, tative appendix set forth in the counsel), Tenney, City, of for York New Report, to this designated to be as-Sec- Co., Inc. National 3.192, tions 3.292 and 3.692. These rules set forth guidance for the of all Goldmark, Kaye, Rosenman, Colin & broadcast licensees and other interest- City (Ralph Colin, F. New York Max persons ed interpre- Commission’s Schoen, New York Freund Andrew J. tation of Section 1304 of the United сounsel), City, for Columbia Broadcast- States (18 Criminal Code U.S.C. § System, Inc. ing 1304) prohibiting the any broadcast of Atty. Gen., Clapp, Acting Asst. Newell A. lottery, gift enterprise, or similar Atty. Lane, for U. S. Southern Myles J. scheme which the Commission intends York, Skolnik, New and Nathan Dist. of to follow in licensing proceedings in Atty., City, York New E. Asst. U. S. James determining whether applicant an Hickey, Special Kilday and William J. a station license or renewal thereof is Gen., the United Atty. Assts. qualified operate his station States. public interest. A Proposed Notice of Counsel, Cottone, Gen. Making Benedict P. Rule subject concerning this Counsel, Wollenberg, Asst. Gen. was Roger issued the Commission on Au- J. Ohlbaum, C., Daniel R. gust 5, D. Washington, Supplemental 1948 and a Notice- brought temporary action was A similar of Illinois restraining, and a 1. September 13, for the District 'Court Northern order District issued on 1949. provided action stipulation each on was issued Making Proposed Rule the amended allegations that all parties Interested August de- complaint as admitted be taken file opportunity afforded plaintiff de- why either fendants and that setting forth or statements briefs may rely upon forth facts set fendants or should should rules they believed companion complaint in the on amended argument adopted and oral filed upon of the affidavits actions and the Com- before held the matter companion actions in either said 1948.” banc October en mission therein. plaintiff defendants either are legal proceedings subsequent The re- thereafter three-judge The court defendants’ of brief summarized Judge designation of constituted case, Broadcasting counsel, American in Rifkind, who place Judge in Weinfeld as follows:— Judge. The mo- District resigned a had provided order “The Commission’s were consolidated in the three actions tions October on go into effect it would argued on Decem- and were argument for 31, 1949, plaintiff August On 1949. 15th, ber 1952. complaint On in this action. its filed Pleadings and Motions. Rifkind con- Judge September complaint Ameri- The amended consisting statutory court a vened Company alleges juris- Broadcasting can himself, Clark, and Judge Leibell Judge specifies un- the statutes facts and dictional having September on and re- brought; is it action der which the plaintiff for a tem- heard a motion by the adoption of the Rules cites order, Judge Rifkind porary restraining action, Commission, the institution set down restraining order and issued a thereto, plaintiff’s extensive parties interlocutory in- application an for and business broadcasting and television the three- hearing before junction for broadcasting in facili- large its investment ap- a later date. That judge court at programs. television radio and ties for for however, come on plication, not did 12 American’s amend- Paragraphs and because, Rif- following Judge hearing complaint alleges:— ed temporary of a restrain- kind’s issuance expended has substan- “11. Plaintiff own order, on its the Commissiоn ing up money building in tial sums postponed date of the effective motion public, advertisers and among the proposed days after its rules until repu- (cid:127)broadcasting stations a valuable co-pend- and the final decision for the broadcast- good and will tation ing actions. operates it and ing owns stations “Following number of discussions a by its programs broadcast sta- for the for the counsel Commission between to' affiliated and furnished sta- tions plaintiffs in the sever- for counsel From them. for tions actions, agreed that cases al it was pro- time, plaintiff broadcasts to time presented could and should be to the central feature having grams requiring in a form not a de- Court prizes in which a contest conduct of questions fact. For that cision the successful contest- are awarded complaints pre- purpose, amended them, programs, or some ants. Such pared in several actions and the de- terms of the Rules within the are complaint present amended ac- programs types which the fining the September 22, tion filed on rtas 'will event con- day plaintiff On same on the moved as violations sider’ complaint, supporting Code, although affidavit and a none of Criminal constitutes, stipulation counsel, or has been programs with defendants’ such constitute, a summary judgment, by any lot- court for defendants held enterprise similar scheme gift tery, filed cross-motion for order dis- or, pro- complaint Such missing the said Section. violation of the al- ternative, summary to demoralize for tended judgment.” grams have viewing pub- complaint Annexed to amended degrade listening provided Company contrary American lic -but on the have description “Stop pro- of its entertainment The Music” information and gram public. radio version Many persons listen view the television to, —the enjoy although for version. The programs contestants are of two such kinds: telephone participants partici- one are not and studio reason or another pants. telephone participants programs eligible prize. to win Such are se- telephone lected lot or chance from highly contributed popular, have telephone substantially participant directories. reputation of and required plaintiff’s good listening to- be at his radio will of stations and at broadcast the time is called. pro- those affiliated with and have he telephone If participant identify profits fails duced revenues and substantial melody, participant given an plaintiff. studio opportunity prizes so. The are fur- do Among “12. such by manufacturer, nished the for in return may are or be the within the terms of a brief product. advertisement of his Rules, which and and we are informed Those who are selected from the television believe the Commission considers express advance, audience through post- Rules, coming within the are the fol- сards, participate. their desire to- the From lowing : cards received a random selection made “ ‘Stop (radio show) The Music’ telephoned. and the participants are “ ‘Stop (television The Music’ An B. Zorbaugh, Secretary affidavitof G. show)” and Acting Attorney General for Ameri- complaint alleges The amended further can, support is submitted in of American’s that and unless the Commission’s Order motion summary for a judgment. Annexed permanently enjoined the Rules be and set many to it are exhibits which are also an- aside, plaintiff’s applications renewal for the by nexed to affidavits Nation- submitted licenses for its and broadcasting stations They al or Columbia. will be hereinafter permits for system or licenses extend its considered. But thing one be should noted automatically will be denied and its invest- now. The Solicitor of the Post Office De- destroyed; ments be or event partment will May 9, in a letter of 1949advised plaintiff will be forced to discontinue the postcard American that the in relation programs may be “Stop the The Music” program would not plaintiff within the Commission’s Rules and regarded as unmailable matter under the irreparable injury; will suffer that Or- postal the lottery statute. He that added beyond jurisdiction der are and Rules whether or not program conflicted authority Commission, and of the violate wouldbe for the Federal Com- Administrative Pro- munications Commissionto determine. Act, illegal void; cedure and are and that Further, May Sоlicitor pro- Rules are violation of certain the Post attorneys Office sent the for the visions the Constitution of the United System Columbia Broadcasting copy of a States and of the amendments thereto. general ruling made for Solicitor the benefit of postmasters, all the in Febru- prayer for relief asks that a three- ary 1947,from quot- which the following is judge court be constituted to hear de- and ed: action; plaintiff termine the that be granted interlocutory injunction; upon and that prize “In order for a scheme^tfc>be hearing final determination this ac- held in section, violation of this tion, permanent- the court “enter a decree necessary (in to show addition to-the setting ly enjoining, annulling aside prizes that fact are awarded adopted said Order Au- means of lot or chance) that the ‘con- gust adopted and the Rules example, there- involves, sideration’ by”. payment purchase money rights legal sion, plaintiff’s in violation of tick- merchandise, admission chance or void; wholly Commission’s account, re- that the or et, payment on an the en- Order be vacated and set aside and expenditure of substantial quires an perpetually hand, if forcement thereof restrained other On effort time. enjoined. amended name Annexed merely required that one’s it is complaint scripts of the National eligi- to be store in order registered at a programs mention- Company Broadcasting prizе, consideration ble for the ed above. Bulletin present. (P. O. to be deemed 13, 1947).” February Mar- affidavit submitted Mr. To Attorney graf, President and General complaint Vice of the National The amended Company, of National alleges juris- Broadcasting Company Broadcasting summary action; judgment, there are order and motion'for basis dictional annexed, among number of exhibits them Communications Com- of the Federal rules following: copy Fly’s of Chairman mission; Broad- the National the extent of 30, 1943, net- letter of December addressed Company’s and television casting radio Wheeler, pro- then In- Senator Chairman work; from the income the annual Committee, Company asking terstate Commerce grams National (draft legislation support he certain en- Commission’s affected would be closed) programs directed at radio “where Rules; description of its Order and members of the radio audience not in Bet “You four thus affected. by lot or chance win a studio are selected to participa- studio audience Your Life” is a prize they they if can listen- show that also Question” is program; “The tion $64 particular ing program”. The draft My is Name” program; “What’s a studio proposed the 316 would of new Section have program; listening audience a studio and pro- prohibited “any the in Nothing” program is or “Double gram money, prizes or which offers other by primary participation mem- the is gifts (as to members оf the radio audience audience, although mem- bers of the studio distinguished from the se- audience) studio invited to listening audience are bers of the part by lected in whole lot or chance”. questions on a label of one of the submit My products: the “What’s sponsor’s On Margraf’s Mr. affidavit also annexes a selection at there is program Name” copies letters sent the Commission’s listening the participants from random Attorney the office Chairman to General’s audience. February calling March his at- complaint alleges following programs the im- “alleged The amended tention the portance programs to of these National to be violation of Section 316 of the Com- danger Company it and the munications Act of 1934.” The “Meads up Mystery license it Bakery program; of its when for re- Woman” loss the newal, program; Commission its rules Gold” enforces “Pot the “Dixie Treas- if program; Bag” in relation to Section United Chest” Grab ure “Sears “Especially There program; pro- Code. are also' alle- Criminal You” States program; the Commission gations gram; “Songo” that is without the “Músico” rules; 20, 1940, power promulgate April enforce the program. Attorney On incorrectly interpret the Commission General wrote that after a they that provisions thorough examination the material rules violate sub- that mitted, Department had Act the Administra- concluded that Communications Act; they finally prosecutive aсtion under Section 316 should that Procedure tive in the matter First, under the Fifth' not be instituted “Pot unconstitutional are Bakery” programs. Amendments, and and “Meads under Clause Gold” and Sixth (Bill April 29, Attorney of Attain- 9 of Article General On 3 of Section after prayer for relief asks the Commission that careful der). that after wrote three-judge no action was adjudge consideration warranted hearing, the court final Department in the “Dixie Treasure' that the Commission’s Order decree day program. On the same authority of similar beyond lawful the Commis- Chest” Attorney letters were sent General violate Section 1304 of the United States respect Code; to the “Sears Criminal and that there is no finding Bag” program, “Especially Grab for of fact the Commission that the said “Songo” program, program You” and program or programs similar thereto “have “Músico”. had a demoralizing deleterious, or other harmful or evil public”. effect on the Margraf’s Mr. affidavit also annexes complaint amended alleges further that showing that in 1939 the documents Solici- plaintiff’s many stations have a value of of the Post Office made tor contra- two millions of dollars destroyed which will be with'respect dictory rulings to whether a if its licenses therefor are not renewed. “Músico”, program, radio known as was a Finally, it is alleged further that the Com- lottery. July On he ruled that the mission’s Rules correctly do not interpret program did not violate the Federal lottery apply Section 1304 of the United States- September laws. On he ruled that Code; Criminal that they violate program “Músico” did violate the the United States Constitution and attorneys Federal laws. When the thereto; amendments violate Broadcasting System for Columbia in- other statutes of the United States quired (the rulings, in 1949 about those two Communications Act and the Administra- replied May Solicitor of the Post Office tive Procedure Act); plaintiff and that likely, will “It 1949: if the Músico irreparable suffer damage unless it is ac- plan today, were submitted this office corded relief in this prayer action. The held, would be change view of the re- permanent relief injunction seeks (a general flected in the enclosed notice judgment and a setting aside the Commis- postmasters ruling prize for all concerning sion’s August 18, order of 1949 and February activities dated 1947) not to adopted rules thereby. postal lottery conflict laws.” also- ruled on March Solicitor 1950 con- Annexed to the complaint amended cerning program transcripts the radio “Truth and program the “Sing It Again” Consequences” post that the contest cards and the program Jackpot”; “Hit the mailable, although copies were for also used of the Order, Commission’s Opinion a random selection The contestants. and Rules. proposed Commission had issued its inter- support In of its motion for summary pretative August rules in 1949. judgment the Columbia Sys- Broadcasting complaint tem, amended The of the Columbia Inc. submits an affidavit of Mr. System Freund, Broadcasting alleges statutory plaintiff’s one of attorneys, which this under action was in- which he copies annexes judgment stituted; corporate . organization (November 1939) Clef, in the case of Inc. plaintiff; the nature and extent of v. Peoria Broadcasting Company in the ' plaintiff’s nationwide radio network and Circuit Court of County, Peoria Tenth alleges District, television network. It also that Illinois. That judgment Judicial “Sing Again” Jackpot” It and “Hit the are held that the program radio “Músico” wás programs network the not two involve any did not violate stat- prizes; pro- revenue those utes award of the United States. Mr. Freund also produce; grams how the contestants from refers to rulings various of the Post Office listening are Department, audience selected at ran- and to opinions of the phone books; Attorney dom from and that on April General in 1940 in relation Jackpot” program “Hit the studio contest- to a number of programs radio which were by pre-broadcast selected ants were inter- submitted the Federal Communications and non-studio contestants ‍‌‌​‌​‌‌‌‌‌​​‌​‌​‌‌‌‌‌‌‌​​‌‌​‌‌‌​​‌‌‌‌‌​‌​‌​‌‌‌​​‍Department views were Commission to the of Justice post chance from in. selected cards sent action under Section 316 of the Com- alleged that because of the It is Commis- munications Act. All of programs these Rules, sponsors have discontinued were listed and sion’s discussed in the affidavit been, that there programs; has never submitted Natiоnal Broadcasting adjudication Company any court these on its that motion. The Commission’s policy December denied in accordance with the dated Wheeler letter to Senator set out in the rules in issue.” 30, 1943, referred to. is also In defendants’ actions the notice of motion the three each of In defend- Broadcasting Company action, National a counter but made de- 'filed no answer ants fendants also ask that this court dismissing the amended strike order motion for an paragraphs or, plaintiff the alterna- and 16 of the amended complaint of the complaint action, summary judgment be that tive, ground directing “the programs paragraphs the defendants. described favor of entered in complaint and 16 of dismiss the amended are motion to ground "plaintiff paragraph fails not within complaint is that of the rules in (b) amended paragraphs can be issue and these upon relief -which therefore to state a claim granted”. impertinent”. the motion for immaterial and ground National Broadcasting Company oppose amended summary judgment is that does not exhibits, defendants’ complaint paragraphs the affidavit and motion strike its genuine for that there is no reason the will be papers other show that motion granted. any and that the material fact issue as to as a judgment

defendants are entitled Lottery Statute motion in each matter Defendants’ of law. Section 1304 of the United Title supported by action an affidavit provides: Code, States Criminal he general counsel in which Commission’s lottery in- “§ steps preliminary taken recites various formation adoption The affidavit rules. “Whoever broadcasts means of argument that “oral was held before states any radio for which a license station en banc” and that “Com- required by any law of the United Coy, Chairman, Hyde and missioners Jones States, whoever, operating adoption participate did not station, permits such knowingly August Report and Order of, any advertisement of Commissioner Hennock dissented from its any lottery, or information concerning adoption”. He also states that the United gift enterprise, scheme, or similar of- Court, District Northern Dis- States prizes fering dependent in whole inor Court, Illinois, having and this trict part chance, upon any lot or or list of orders, restraining decided to issue "The prizes drawn or awarded means 21, 1949, Commission, September on issued any lottery, gift enterprise, of such or postponing an order the effective date of scheme, any whether said list contains days thirty said until at least after rules part prizes, of or all such shall be fined ultimate determination these ac- of $1,000 more imprisoned than or tions”. year, not more than one or both. general The counsel’s affidavit further day’s broadcasting “Each shall con- states:— separate 25, stitute offense. June . “4. Plaintiff broadcasts one or more 1948, 645, 62 c. Stat. 763.” prоgrams which contain com- features prehended or sections, one more of the rules Said one section 1304 is of five 130'5, in issue in case. such After rules 1301 “Chapter which constitute §§ effective, the plain- become failure of 61—Lotteries” of Title 18. Section 1301 “Importing tiff to discontinue the of with transporting or lot- deals any tery tickets”; 1302, or all of “Mailing such would re- Section with applications lottery matter”; sult in setting hearing tickets or related Sec- by plaintiff 1303, employee for renewal of licenses filed tion with “Postmaster or and, upon pro- lottery 1304, a finding agent”; that such Section with grams information”; or “Broadcasting lottery have been will continue 1305, carried, applications be such Section “Fishing would be contests”.2 2. The reviser’s in revision of the Criminal their to such lottery” 1302, according pastimes typical etc. fishing Section innocent as the Note, contest, to 1948 Reviser’s was derived which has a solid basis of re- dating spectability from and §R.S. 3894 various Acts and wholesomeness far re- may reprehensible type back at least to 1876. It be assumed moved from the activity gambling that when 316 of the paramount Federal Section which it was originally congressional Communications Act was en- mind to forbid.” part in acted as Federal Colony Commissioner, 3. Old R. Co. v. Act, Communications it was modeled on U.S. 54 52 S.Ct. 76 L.Ed. provision against the U. S. Criminal Code Lotteries, C.J.S., 18, pp. 1 and §§ mailing lottery tickets and related mat- 862, citing and cases. Code). (former ter TJ.S.Criminal § prosecution “gift enterprise” mailing a In fact under 4. A is in one which the (former 336) purchaser given statute § was of an sustained article is a chance where, advertising by prize. C.J.S., Lotteries, a result as a to win § broadcast, p. gift enterprise mails radio wore When a used in 850. involves lottery. a furtherance of Horwitz essential elements of a States, Cir., (chance, consideration, prize) United 63 F.2d a 706. it is un- adopted Gregory, was not until Matter of lawful. 219 U.S.

August Congress 1950. The 31 S.Ct. 55 L.Ed. 184. intended depends (b), the Commission subdivision (a) subsection “contestants”, However, according to include each case. facts on Commission’s any con- event inwill counsel.] Commission within program comes that a language sider incorporates Paragraph (a) con- in (a) if subsection provisions of ap- Paragraph (b) (1) of Section prize program a with such nection a “prize enterprise” well as plies a as value money thing of or consisting of lottery. se- whose any person is awarded proposed at Rules were considered or in dependent whole in lection at which hearing a of the full Commission chance, a con- if upon lot or part parties plaintiffs other interested these competing for winning or dition af- present, hearing notice. The on prize: such plaintiffs adequate opportu- forded objec- present grounds their nity re- or winners “(1) winner such briefs, argument oral tions in both thing any money or quired to furnish oppor- availed themselves of in rеquired have or are value sold, “A”, tunity. consisting Exhibit of two product any possession their bulky volumes submitted Govern- distrib- manufactured, or furnished motions, ment these wide- on shows how broad- program sponsor of a uted a spread and varied were the sources and question; or in the station cast on responses by the contents of received re- winners are winner or “(2) such rules, concerning proposed Commission viewing to or listening quired to be publica- the comments the various radio question on a or program in relation thereto. tions receiver; or television necessary for the It was are re- winners “(3) winner or such testimony adopting to take before correctly question, a answer quired to procedure by the followed Rules. pro- given a to which the answer appropriate for the Commission was matter the station over gram broadcast rule-making under consideration. answering where aid to question power procedure through was exercised a correctly given on a question the Administrative Pro- conformed to the station broadcast over program 1003(b). The Act. T. 5 U.S.C.A. cedure purposes this question. For adjudicating con- Commission was ques- broadcasting of the provision require troversy hearing which would the radio sta- over to be answered tion procedure. application and the trial will previous program tion aon case, later, might specific That come in answering сonsidered an aid application for when an a renewal license correctly; question would be under consideration. or winners are re- “(4) such winner Rule-Making Power Commission. pre- phone in a quired to answer the speci The Communications Act prescribed or with manner scribed fically empowers the “make Commission to let- required to write a phrase, or are regulations, issue such such rules contain- prescribed manner or ter orders, chapter, not inconsistent with phrase, pre- if the prescribed ing necessary may in the execution of its be as answering phone of manner scribed 47 154(i); and functions” T. U.S.C.A. § prescribed writing the letter or or grants the Commission the 303(r) Section phone or used over the to Ibe phrase power carry making rule “to out the same (or ascertaining an aid in in the letter chapter”. The provisions of Commis prescribed phrase or the prescribed orders, authority to make rules had the sion phone answering of manner or, broadcasting in relation to regulations and been, is, has writing letter) provisions implement the of programs to in question.” station over the broadcast (formerly of Title 18 U.S.C. 1304 Section or winners” used “winner words [By Act), Communications the Federal 316 of (2), (4) (1), (3) and paragraphs § 884 penalty by drastic sanction. Columbia proceed general rule or and could

n States, System v. United 316 in its discre ad decisions individual hoc 418, 407, 1194, 86 L.Ed. 1563. Exchange Comm. v. 62 S.Ct. & U.S. tion. Securities 1575, Chenery Corp., 332 67 U.S. S.Ct. argue Plaintiffs’ that these сounsel did not 1995. The Commission 91 L.Ed. “give-away” programs rules in relation to judicial de a determination have to await “necessary are neither in the execution of program to be in type certain claring a (the functions”, Commission’s) its nor formu violation of said sections before “necessary carry out to not Rules could lating Rules. But the its Communications)”. Federal (the this Act be to types declare certain If it is a function of the Commission to lotteries, .they not if a of law as matter properly qualified determine to who are a viola lotteries would constitute operate broadcasting and television stations authority make tion of said sections. The and to receive licenses or licenses renewal Lin power to make law. rules is not the therefor T. 47 303 U.S.C.A. § § of Int. Electric Co. v. Commissioner coln stating required qualifications rules Rev., Cir., 1951, 190 F.2d 326. 6 necessary to function the execution of that Commission; pro of the if under the adopted, constituted a The rules as the Act re visions the Commission is warning existing to all licensed broadcast pass quired upon applications for licenses pro ing that, “give-away” if their stations renewals, license 303 and rules § § rules, grams violated the that fact new applicants barring broadcast who would would be considered the Commission programs which would be violation application a when the stations made carry necessary pro a statute are out the of thеir renewal licenses. Under Section may of the though visions Act. Even of the Communications Act of 307 abe function of the Commission to en amended, may no license law, force criminal the Commission granted years more than three or for power any applicant would have the to bar years more than five case other who violated the criminal law. Section similarly licenses. renewals are License of the United Criminal Code States applicant limited. An for a renewal license closely is so identified with the field in hearing application. is entitled a on his which the one Commission functions that at may 309(a) the Act. The § part,.§ time it was Federal Com to renew a for a refuse license violation of “public interest, munications Act. The any regulation authorized the Act. necessity” convenience standard for the 312(a). The refusal to renew a license § issuance of licenses to broadcasting com violation for a rules Commission’s panies imply requirement would compliance effect to-enforce sanction applicant law-abiding. Although Con rules, proper but it exercise of gress by specific enactment authorized power the Commission’s if has station deny the Postmaster General to the use of deliberately violated a rule of the Commis schemes, the mails to gambling lotteries and duly had been promulgated sion which 39 U.S.C.A. 259 and Public Clear § scope was within the of the Commissiоn’s Coyne, ing House v. U.S. S.Ct. powers. rule-making Section 9(a) necessary 48 L.Ed. it was not Act, Procedure prohibiting Congress- Administrative specifically authorize sanctions, apply. unauthorized Commission to take against does not action a broad company University System casting Regents of which violated Georgia Carroll, 1304 of the Criminal Code U.S. because S.Ct. power, licensing specifically specific conferred on In L.Ed. 363. case the station the Commission under Sections 303 and 309 right have the court would review of Act, would include that authoriza the order of Commission declining to tion. the station’s license. renew 402 the Rules, by But the enforcement ‍‌‌​‌​‌‌‌‌‌​​‌​‌​‌‌‌‌‌‌‌​​‌‌​‌‌‌​​‌‌‌‌‌​‌​‌​‌‌‌​​‍of by Act. the urged plaintiffs It is also that Section license, refusal a renewal the would be a 326 of the Act withholds from the Commis-

385 number of are censorship” radio listeners a contestants and bars power sion “the wheel, by spinning a selected the which “any which shall regulation the issuance of phone speech by first determines the number of a right the of free interfere with thereof; book; page finally a next a and and that communications” means radio phone page. name and number on that the was without therefore the Commission telephone number is then the called and if authority give- as to to issue these rules person later, listening answering is at the time away programs. As will be shown program, “password” the give or is able to speech the a of free are not abovе the media previously or an answer on the disclosed the criminal law enacted program, he becomes public; one of contestants protection and general principal prizes. for the if mails, Even he does press, barred using when is win, prize 18 he receives a consolation under United Section 1302 of Title programs. programs, some things television On doing States Code from the same contestants, instances, se- prohibited some are that stations are lected from the at ran- invisible audience doing from under 1304. Section dom, postcards by prospective from sent in (2), (3) [(b) Commission’s Rules contestants. (4) apply that are programs would ] not crimes under 1304 of Title Section The contestants selected from usually studio are audiences interviewed qualifications advance. Their are consid must A criminal statute be strict by management ered before the selec construed, ly though may even be reme is tion made. Where contestants on purposes dial in its nature and are to its program solely come from the studio protect general public. United States v. they by audience and are not selected Halseth, 72 96 L.Ed. U.S. S.Ct. chance, it would seem that an essential ele McGuire, Cir., 1933, 308; United States lottery lacking. ment of a Where some 485. Rules of Commission F.2d by telephone of the contestants are selected which a criminal are based on statute should described, calls in the manner abоve construed, strictly especially likewise be contends that the element of Commission they supported by penalty where a chance is involved their selection. I sanction more drastic than fines. Columbia agree with that contention. System States, Inc. v. United listening The act of to a broadcast of a 86 L.Ed. 1563. U.S. S.Ct. program, “give-away” viewing onit beyond go The Rules cannot the Statute television, “price” not constitute a does they implement. which seek to If the stat consideration”, or “valuable expended ought give ute to be to include “lottery”. element essential of a away solely programs, within the prize, offer of Besides the a province Congress. United States v. presence of the element of chance select- Williams, U.S. 95 L. S.Ct. participants ing some of the who will con- Ed. 758. shown, prize, it must also be test for plaintiffs’ attorneys argue lottery, to constitute order legal that the Rules fail to conform to the value, price, something of is furnished lottery, definition aof and that the Com participants. The least some of the at erroneously interpreted mission has contends that something of 1304 of the United Criminal States Code. prospective par- furnished value is “The essence is a chance part ticipants because become of an prize price”. for a Commonwealth v. audience, aggregate which in the invisible Wall, 295 Mass. 3 N.E.2d 29. The thing of value to the station is a broad- specific gov under attack program casting advertiser prizes, ernment in these station, three actions offer sponsors program. To who at program least some of the contestants for it can sell the because its au- advertiser; prizes advertiser, are selected lot chance. to an dience instances, In program some from the thousands of he can use the ve- because to the listener is not legal the sale detriment radio pushing “commercials” hide for “price” “thing the kind of a or of value” his merchandise. paid by participant lottery, a which a may manufac- when a We assume that contemplates essential ele the law as an sponsor radio or tele- for a turer becomes a Wall, lottery. ment of a v. Commonwealth pay he will program, vision the amount 28; 295 Mass. N.E.2d ex rel. State appeal, depend upon popular its for it will Corp., Fox Great Falls Theatre Stafford v. likely it is the invisible audience the size of Burns, Mont., People 132 P.2d v. that program features of a to attract. The 498. There are cases N.Y. 107 N.E.2d many and special may appeal be have a contrary, C.J.S., in 54 to the see footnotes assume mistake to It would be a varied. Lotteries, page but this seems program every listens to that one who the more reasonable view. television, does it on or views on the radio may a tele- hope he receive that so in government for the state that Counsel and win participant phone call to act as a cases, that most of the decided the one many may that harbor prize; that a but closely approaches situation of the factual true, that fea- hope probably otherwise is Maughs “give-away” is v. not be included. program would ture of Porter, 1931, 157 Va. 161 S.E. program If it adds to the value defendant, auctioneer, In that case money to the value sponsor a it has a audience, large order to attract a adver- broadcasting station. everyone that who the auc- tised attended not, sale, whether he thereat or tion bid listen It is not the value a an automobile. given would be chance on sponsor or participants station ing sale, num- Plaintiff received a attended contem valuable consideration that is the ber her number was drawn as win- lottery Griffith plated by the statute. defendant re- ner of the automobile. The Tex.Civ.App., Morgan, Amusement Co. v. plaintiff. the car to She fused to deliver par 844. It is the value 98 S.W.2d lack of consideration sued. The defense of gives must ticipant he that of what promise was Cardas, Cal.App. for the of defendant resolved People weighed. favor, pros plaintiff’s holding that do the the court Supp. P.2d 99. What sale, plaintiff The Commis at the was pective participants give? attendance attend, “legal obligated legal was legally is detriment” a argues that it a sion аt home listen But the court went on to viewer to sit consideration. the listener or say a tele program that it was also a consideration fur- awaiting ing to charge by plaintiff participant in a phone from those in call nished a lottery illegal the law un- Technically, lottery a was applying and since contest. contracts, agreement that may Virginia, true. But laws of that der the statute, a lottery That case has been where a was unenforceable. not sufficient is alleged statute, Reviews.5 is involved. The in the Law criminal criticized prohibiting Virginia (18 Law The Har- Review statute lotteries.” 5. The Law Va. expressed 465) (45 view that Law Re- Law Harvard vard Review Review 1200), type concept general of valuable on the of the kind view in a note requisite lottery, consideration, of a as an essential as an element consideration monetary pecuniary lottery, “Money, consid- states: element of was a Pennsylvania requirement. University course, satisfies eration. unimportant; enough; (80 of Pa. Law Review amount is U. cent Law Review Virginia thought money legal 744) court not even be tender. that need monetary Maughs property it held case when Other value in the erred consideration, plaintiff's at the auction serves services attendance adequate. Usually for the tick- also be consideration would sufficient was drawing automobile, presence of tire of consideration obvious”. et Maughs lottеry commenting case, In on the statute concerned. far as so in the article states: —“In states: “But it does footnote article purpose event, a consideration sufficient laws is follow giving up money necessarily prevent people support kind from a contract contemplated money’s hope worth that chance of consideration

387 n played windows, Courts other states have not followed in one of those he en- Darlington the Maughs case. In store, presents Theatres ters the coupon, and his 788, Coker, v. 2 190 S.C. S.E.2d receives that article.” Supreme Judge Court of South Carolina then concluded: Maughs stated that v. Porter was not in “Manifestly joint this is a effort to accord with “the general current of au promote shopping, window which thority in In Big America”. State v. Chief hitherto has not been deemed even Corp., 64 R.I. 13 A.2d the Su - faintly illegal or immoral.” e prem Court of Rhode held that Island Byers Judge further concluded that the Maughs v. against great Porter was Solicitor for the Post Officehad that “ruled weight authority. In State Kansas ex consideration, to be a no common- rel. v. Corp., Beck Fox Kansas Theatre process sense reasoning be desig- can so Kan. Supreme P.2d Court nated”, because the Solicitor had mistaken- Maughs Kansas referred to v. Porter as ly assumed that kind of consideration representing an “extreme instance of the necessary lottery in a only case was what People feature of consideration”. And would suffice in upon an action contract. Shafer, v. 160 Misc. 289 N.Y.S. appealed The Postmaster to the Court of Maughs the court Porter considered v. Appeals, Circuit, Second and moved in thaf controlling having subject and as been stay Byers’ court Judge pend- order to severe criticism. The Shafer case was appeal. ing Judges Hand, A. N. Chase and later affirmed the New York Court of application. Clark heard the The court Appeals, 273 N.Y. 6 N.E.2d 410. (Judge held Clark dissenting) that A Circuit, recent case in this Second Postmaster’s stay motion for a should be City Garden Chamber of Commerce Inc. denied for the reasons stated in Judge D.C., Wagner, F.Supp. 192 F. Byers’ opinion. Judge Clark, dissent, in a 240; D.C., appears F.Supp. 2d viewed the scheme a lottery. He held in very point. be much in that case In effect that since “the providing merchants defendant, City, Postmaster of Garden re prizes secured the inestimable ad- postal certain cards fused to allow to be vertising boon of bringing potential through transmitted the mails on the prize-seeking right customers into their grounds part aof stores, following upon diligent hard exami- sought injunc plaintiffs scheme. The an shop nation of the displays window to dis- against describing tion the Postmaster. In lucky cover prize numbers” there was scheme, hunt, designated as a treasure sufficient consideration to make the scheme Judge Byers stated that it the fol involved lottery, and that the treаsure hunters’ steps F.Supp. lowing : [100 770] participation requisite furnished the con- “(a) recipient Each card de- sideration.6 coupon taches' therefrom a removable If window shopping by printed hearing the same number as treasure was not (cid:127)hunters such a does card itself. sender re- “consideration” as would make the coupon, treasure (b)

tains the after mail- hunt scheme lottery, is listening card ing the to the Chamber Com- radio or watch- ing a merce, (c) shop type into television he looks win- screen the of consider- storekeepers partici- ation that would dows of who make a give-away pro- pate plan, gram lottery? not, If he sees .a (d) his If then subdivisions attached to an to 4 number article dis- paragraph inclusive (b) profitable, make their will investment appeal Judge 6. The Postmaster’s from' performing forbid them from acts Byers’ abandoned, order later was anyone. having no Per- intrinsic value Byers Judge later ruled that his decision haps decision can sustained on plaintiff’s original application on the people ground while not have did injunction had thus become a final de- eligible bid the auction to be re- at controversy. D.O., termination automobile, reasonably ceive the F.Supp. probable that this would the case.” 388 beyond scope go

Commission’s rules of which Senator Wheeler Chairman) lottery and ex- took no action Fly’s request. statute are an unlawful on Chairman power. ercise оf the rule-making This is not a case where the Court is opinion asked to set its over and above that danger “impoverishment” The of to the of the majority Commission or of a of the, participants development and in them membership. Commission’s There spirit” of “gambling a mention- have been seven members of the Federal Communica- ed some the earlier of cases as the evils tions Commission. The rules under attack lotteries, lottery. of a leading case on adopted by were only of action four of States, 449, Horner v. United 147 13 U.S. One of members. the four dissented. 237, quotes S.Ct. 37 L.Ed. from de- The basis of dissent was that there was lotteries, against cisions and state and laws nothing given by any par- of value of “pernicious cites the tendencies” which ticipants winning prize. for the chance of a See, designed prevent. laws State grant injunction If we against the en- also, Virginia, Phalen v. 8 How. 49 forcement of Rule (b) (2), (3) (4) page 163 12 U.S. at L.Ed. 1030. I fail holding we shall not be contra to the view anything imperil- to see akin to those evils majority of of Commission; a and our ing the invisible radio and audi- television decision will be in opinions, accord with ence type pro- who listen and view of concerning “give-away” similar programs, gram by (2), (3) condemned subdivisions by Attorney rendered General in paragraph of (4) (b) of the Commis- although Attorney ap- General now programs sion’s Rules. Those cannot be pears support of the Commission’s new “reprehensible tyрe classed gambling of rules. activity paramount which it was congressional (See mind to forbid”. Re- These do rules of involve port Representatives of the House of Com- problems the scientific or technical television, mittee on Section 1305 of the United radio States their statistical field Code, relationships, Criminal referred to in footnote inter-station concerning No. above.) 2 expert the Commission has knowl edge. opinion, although Commission’s opinions legal In the given the United respect, entitled to is not authoritative. In Attorney States 'General to the Commission terstate Commerce Comm. v. Service type program now condemn- Co., Cir., Trucking Lin F.2d lottery ed the Commission’s Rules as a coln Electric Co. v. Commissioner of Int. was held not to be covered Rev., Cir., 190 F.2d 326. We need not of the Federal (now Communications Act applicable consider as the admonition of Code). 1304 of Criminal Ex- § [See Judge Frankfurter in National Broadcast E, F, G, H, I hibits annexed to the J States, ing Co. v. United 319 U.S. 190 at Broadcasting Company’s American affidavit page 63 S.Ct. 87 L.Ed. thereupon Commission herein.] should courts hesitate to substitute sought specifically have Congress their views for own those of the Commis type prohibit program this and wrote peculiarly sion in matters within the knowl on Wheeler December Senator 1943. edge experience Commission. Exhibit “D” annexed to the American question presented [See The basic mo these The Interstate interpretation affidavit.]7 tions is the (of Commerce Committee of the statute, Senate application and its 7. In his letter Wheeler, important enough to Senator Cliair- serious and to warrant problem Fly by Congress man “The mon- stated: action at this ‍‌‌​‌​‌‌‌‌‌​​‌​‌​‌‌‌‌‌‌‌​​‌‌​‌‌‌​​‌‌‌‌‌​‌​‌​‌‌‌​​‍ time”. The programs very ey give-away proposed is a trouble- Chairman enclosed draft ** * give-away Un- some one now Section 316 directed at present programs. section dor the Com- The Chairman also stated Act, type munications has in his letter that: “Under adequately program, unable to deal been listeners are attracted * * * problem quality program simply by believe the I matter but They appear by the Com- condemned source of amusement types people. question many legal thousands of if That Even Rules. mission’s could province of the be said that can see nothing “we peculiarly within the any possible society” pro- value to in these courts. grams, “they are much entitled to the Questions. Constitutional protection speech of free the as best of Speech. First Amendment —Free The literature” or Winters People music. v. of Broadcasting television are York, 507, State of New 333 U.S. 68 S.Ct. of the First protection to the entitled 665, 667, 92 L.Ed. When the 840. radio or Constitution, guarantee the Amendment to them, television they tire of audiences will press. speech of and of the ing freedom make their the exit. But can- apply held amendment been to to The has hurry characterizing them off cer- pictures, newspapers moving “like and tain “give-away” features of the programs Paramount Pic radio”. United v. States lotteries, they if matter of as a law are 915, 166, 933, tures, 131, 334 68 S.Ct. U.S. not. guarantee 1260. But that does not 92 L.Ed. rules, Plaintiffs the given assert that if press, either or the or the individual shield effect, deprive would them of prop- their any media for the communication of erty law, process without of due in contra- application from of criminal thought, the vention of the Fifth Amendment designed protection for the of the laws Constitution,8 subject would them to public. speech general is not Free absolute punishment for a jury crime without a States, 341 but relative. Dennis v. United trial, in of violation the Sixth Amendment 494, 857, 71 S.Ct. 95 L.Ed. 1137. The U.S. Qause 2, III, and Article 3 Section Commission, of subject the in their Rules Constitution; that the Rules constitute (lotteries), infringe right matter did not a Bill I, of Attainder in violation of Article speech press guaranteed of free or free 9, Section Clause 3. Rapier, Amendment. In re First 143 110, 374, 93; 12 L.Ed. In U.S. S.Ct. 36 Horner formulating question the rules in 207, States, 407, 143 12 United S.Ct. Federal U.S. Communications Commission was 126; Maga 36 L.Ed. Donaldson v. motivated the belief “give- Read. zine, 178, 591, away” 68 programs U.S. S.Ct. 92 L.Ed. involving radio- and tele- 628; participation National Broadcasting vision audience Co. v. United fell within States, prohibitions page U.S. 190 at of Title 63 S.Ct. U.S.C.A. 1304. rules, according 87 L.Ed. The Commission’s Johnston Comm., report, Federal give Co. v. were intended Communications effect to the U.S.App.D.C. 40, Congressional еxpressed intent F.2d 351. But in in so Section prevent provisions far as some of their [paragraph the furtherance of (2), (3) beyond (b) (4)] go scope through schemes the use of interstate Code, they broadcasting of Section 1304 of Criminal media.

may be of considered as a form “censor Under the of the Federal Com- ship” -and to that extent would be in munications Act broadcasting company violation of the First Amendment. would be entitled to a trial and would have

The right courts, “give-away” of review in including merits right in injunction pendente not an issue to an case. lite. hope being of in awarded valuable when public danger; actual service in time War or prize simply by listening particular any person to a nor shall program. good subject broadcasting”. This is not for the same offence to be twice Capital Crimes; put jeopardy limb; 8. “Amendment Due of life or nor shall Y— compelled any Process criminal case to abe person -against himself, deprived “No shall be held answer for witness nor be capital, crime, life, liberty, property, or otherwise infamous without due presentment process law; private proper- unless on a or indictment of nor shall Jury, except arising ty public use, just a Grand in eases be taken for without forces, Militia, compensation.” the land naval inor

(cid:127)890 purpose Federal Communica- Amend provisions of Sixth III, Pro- ment the Administrative and of Article Clause Act and of Section tions dеfendant, followed. was to have to be assure a a criminal Act would cedure speedy prosecution, that he compliance with due would have a That would be a public impartial jury in a Broadcast- trial process Columbia amendment. proper States, right venue confronta 316 U.S. ing Co. v. United tion, process the assistance court S.Ct. L.Ed. I, Article counsel. Clause Com power Federal prohibits passage Bill Attain or with grant munications Commission legisla der, which has been described public interest and to hold licenses punishment tive act which without inflicts carry out the in as will such rules make Lovett, judicial trial. United States v. Communications of the Federal tendment 303, 1073, 328 1252. U.S. 66 S.Ct. 90 L.Ed. employ authority to implies a grant Act Neither of the above nor the amendments pow necessary discharge the the means to specified sections of the have Constitution Com v. Federal ers Stahlman conferred. any application to the facts of these cases. 1942, U.S.App.D.C. Comm., 75 munications parties facts, stipulated having 124; Federal 176, 126 F.2d Communica findings no of fact need be made. The Comm. Pottsville tions stipulation and defendants’ motion concede 134, 437, 84 L. Co., U.S. 60 309 S.Ct. plaintiffs’ “irreparable allegations in- means chosen Ed. 656. The jury”. sufficiently Our conclusions of law compel compliance with Commission’ to appear opinion the above and the re- in in ' deny a or a was to license its rules judgment. lief to final granted be any apрlicant whose license to renewal Relief Granted. were found to television activities radio or summary judgment motions Plaintiffs’ for Federal Rules. the Commission’s violate extent, granted in their favor are to this O. K. Commission v. W. Communications Federal Communications Commis- 223, 213, O., L.Ed. 204. 67 S.Ct. 91 U.S. 329 permanently and sion will be restrained finding A the Federal Communications enjoined (2), enforcing from subdivisions rules had been trans Commission that its (b) (3) paragraph and of its inter- (4) conviction gressed not amount to a would pretative adopted 18, August 1949, in rules v. Fed crime Mansfield Co. Journal relation give-away to radio and television 1950, U.S. Comm., eral Communications programs; and the order Commission’s App.D.C. nor would the F.2d will, adopting extent, the rules to be applicant pun be a a license to an denial of vacated and set aside. The enforcement of ishment for crime. paragraphs (a) (b) (1) not violate Sixth As to and rules would Amendment, III, summary rules, plaintiffs’ or Article Section said motions for denied; I, injunction judgment Clause 3 an are Clause Article and order, adopting and Commission’s the Constitution.9 Crimes, Jury 9. “Amendment Trial for “Art. Ill —Section Clause Crim- 3. VI— by Jury. Rights inal Trial And Procedural Crimes, except prosecutions, ac- Trial in “The of all “In all criminal right speedy Impeachment, by Jury; enjoy shall be to a Cases of cused shall impartial jury public trial, Trial shall and such be held the State and where the said 'Crimes shall have been and district wherein of the State committed; committed, but when not been committed shall havе crime State, any previously as- the Trial been within shall be at shall have district Congress law, as the to informed of such Place or Places certained accusation; may by Law have cause of the directed.” nature and 3. with the witnesses Clause be confronted “Art. I—Section Bill him; compulsory proc- against Ex Attainder and Post Facto Laws to have favor, post obtaining Attainder witnesses in his “No Bill of or ex facto ess passed.” have of Counsel Law shall be the Assistance for his defence.” rules, respect para- governmental upheld to said refusals to act of other graphs agencies or (b) bearing of the rules. officers have little on (a) (1) problem. say our Sufficeit to

Defendants’ that now the motions to dismiss the Department complaints amended are denied. Defend- Justice loyally summary co-operatively engaged judgment ants’ motions for advancing only what I—think granted defendants’ in re- favor are —and interpretation spect Against a correct paragraphs (b) (1) of said of law. (a) estoppel para- obviously this there rules. Defendants’ motion to strike can be no operate against graphs either the and 16of National Broad- United States Company’s complaint casting agencies. America or one of amended its granted. specific Now I turn to the issue. It is judgment aLet final be settled accord- statute, part well to recall the now ingly, days’ ten notice. Codе, formerly Criminal U.S.C. § part Act, of the Federal Communications concurs. Judge,

WEINFELD, District adopted June, U.S.C. prohibition against Its “the CLARK, Judge (dissenting). Circuit of, any advertisement of or information Judge masterly analysis concerning any LEIBELL’S of lottery, gift enterprise, or point only the case shows that scheme, doubt prizes similar offering dependent or is as part concern to whether “consideration” upon in whole or chance, lot or or given in return any prizes is for a chance at substantial list by drawn or awarded prizes and valuable or financial awards. any lottery, means of such gift enterprise, Though earnestly argued by emphasize the several or scheme.” I two matters: plaintiffs, the other (1) prohibition contentions—some ris- merely Within the are not ing to the constitutional level—are uncon- enterprises but lotteries, gift any “sim- vincing and I agree with the prizes court in ilar scheme” offering dependent upon over- ruling But on the “chance”; them. one issue (2) which the statute does not men- proves thus controlling, I do not feel that tion “consideration.” I stress the first be- my brothers have reached result which is cause there does seem to feeling be a law, or, consistent indeed, reason, with the case that it “buying” concerns a ticket accordingly and I dissent. the drawing prize to of some grand good sweepstakes old-fashioned manner. this, Before I turn to shall briefly I dis- broader, the statute But is much as broad pose of some underbrush. It seems me to in fact it possibly could be made for the only that not was the Federal Communica- objectives in inclusive, view. It is more justified tions Commission this tackling example, for than such a statute thorny as N.Y. subject, but, indeed, duty it was its Law, Penal McK.Unconsol.Laws, c. do so and it to is to § be commended for its “the reaching property distribution of length efforts at to have the matter definite- by chance, among persons paid who have ly determined. Like the enforcement of all agreed or pay to a valuable consideration sumptuary or legislation, moralistic there for the chance.” So it is not sig- without pass is natural desire to the buck to may nificance that others; Congress when and this in 1950 be accentuated where showing criminality “any wished to validate required would fishing contest not pressing profit for the of an conducted for prizes indictment. But wherein Congress says when the that “Whoever specie, size, awarded for the weight, or any broadcasts means quality radio station caught by any fish contestants in required for which by any a license ‍‌‌​‌​‌‌‌‌‌​​‌​‌​‌‌‌‌‌‌‌​​‌‌​‌‌‌​​‌‌‌‌‌​‌​‌​‌‌‌​​‍is law fishing bona fide event,” or recreational it States” United shall do certain it had to do specific felt exemption. things pain under imprisonment, fine and 1305. And U.S.C. omission of § licensing authority 18 U.S.C. reference to consideration—unlike the New surely must take some heed of the mandate statute, example York its own —carries accordingly and act if it is not to wink at meaning. The federal law contains nо impliedly approve or the law’s violations. requirement technical of consideration as it past So does to me seem such; actions or whatever is read into the statute erators, trips America pianos, South carry essential its out be what will must ¡cash beyond wildest their good hard purpose. provides stupendous audience SO' an dreams be over purpose cannot Now essential hardly to be message as advertising for the grand debauchery by single simplified to suspect the time I estimated. And lotteries, the in several lottery, even always spent any single listener is almost United leading case Horner itial A moments will fleeting few considerable. 37 L.Ed. States, 13 S.Ct. 147 U.S. are, rules adequate to learn what the not be it Rather is pains point out. is at guess tune or to the hear and the answer road to direct somewhat less at a aimed accept' the fateful question, and and answer industry and want: lack waste impelled telephonic inquiry. just One get by initial success initiative induced out, and, having gotten hear the hour operation of returns from ting valuable it, following hang of to come back the quite specifically also There is chance. week, part family as a and have listen unjust enrichment accrues game calls. until the announcer But it manipulators the scheme. broad possible anyone advertiser, still My brothers, it me, seems to are drawn — pure gifts; caster, not —to make or what away natural from the answer the odd plot calls attention to the Commission “price” mistake that what is as the involved twenty ago, picture years moving of a (terms or “valuable consideration” them- Million,” says that if “a I Had a “If constituting overprecise selves formula- away persons gives man his rich millions issue, pointed out) tion of the as I have random, may conceded that chosen at sponsor,” value “to the station but done violation of no evil would be and no participant “It is value to the of what what be involved.” we the law would So weighed.” course, that must be he.gives Of really looking the gain for is some to are yield participant the must if something; takes the promoters of the scheme which quite supine, gift. he is there a would be pure matter out the realm of altruism. of surely application by my But the made quite course, requirement the This, simplifies brothers inverts and greatly of the meaningless makes It it and irrational. is problem. But believe it sense of I makes operator what the terms inquire receives —in of too. whether the broad- it, To necessarily to value himself —which must advertising casters customers and their the gift mark difference between a a operations and engaged in altruistic is are of chance, between altruism and business. supply course to the answer at once. What opinion appears The purchase to hold that while re- doing is to time to adver- ceiving something the of benefit as valu- tise and vеnd their wares —indeed most as able this radio time not cast conceivable, does doubt alleged time valuable in upon sponsor’s yet par- papers altruism, before us all.1 conceded ticipant’s expenditure any pecuniary of may spent by single time a listener be cent,” “a 5 of amount —-even see note spent 'by brief. time quite But the whole opinion' illegal.2 country scheme at once hanging in for an hour more less —makes go And even breathlessly upon given amount need not to a nationwide broadcast operator. only not may yield Such a makes probably view (but which will not) easy evasion and enforcement natural ranging refrig- the listeners returns from ' biggest money-paying Indeed, becoming already show on the air. audiences are Offering 82,900.’ ten minutes he un In hardened what were to once considered just fabulously high give-away loaded two tickets.” See bonanzas. following Times, quot enough” item N.X. 2. The statement “a cent is Sunday Section, p. 28, 1952, opinion Dec. Radio ed from 45 Harv.B.Rev. 1106, appears 1206, from X 11: Times. A doorman “Hard be borne out People Runge, at the cases cited: A. B. C.’s Ritz Theatre stood v. N. Broadway Forty-cig'hth 85, Hun Y.Cr.R. Glover v. corner of morning Malloska, a 238 Mich. last week with 213 N.W. Street one your holding also all ‘Get free tickets A.L.R. participants that not handful tickets. ’ pay Bank,” yelled, ‘the need even the one cent “Break the he have found or cre writers For courts difficult, impossible; it also— if not course doubt, it little does confusion ated say I this with deference —makes stated, Moreover, as good catalogue this. say that To approach irrational. whole legal differing many precedents concern donation, we whereas pure here we have myself I shall content were situations. lottery participant a if would have apposite. a I most authorities consider few penny in a collection deposit required to a Porter, 157 Va. Maughs v. First I cite a plate, in Marchrof-Dimes or even a dime a found in ap- S.E. the case just does not make sense. kettle, sale a estate auction attendance at real plicable any strict doctrine test is away given an automobile where symbolic peppercorn to formalize yielding a only a person present, not because practical to a conveyance. It is or a a contract case, of the friends yield but because leading also one, perceptive fact of the made. Thus it has been and enemies it has surely important. And operator all case, persuasive cited cases, approved ear reasoned recognized this is the well Wilson, lier, Vt. 196 A. Wilson, 196 A. State v. 109 Vt. such as State night” 757, holding “bank scheme a theater below. cited Attempts lottery. to answer the court’s compar- made If issue can thus be difficulties, analysis produced have fresh atively simple, sо why has considerable an extreme, forcing commentator to the one confusion, concern, amount de- if opposing indeed in several of found part veloped is un- in the cases ? A this cases, monetary pe requiring doubtedly differences in the occasioned cuniary consideration, 18 Va.L.Rev. governing law; cases under the New thus far, trying so going while to avoid another, hardly York statute cited above would present says while the consideration under the federal law. But safe authorities was not “of economic value” —a master reason, believe, I the main lies elsewhere piece applied unreality, particularly and, fact, is not hard to discern. It seems U. of Pa.L.Rev. 744. Another here. 80 attempts to be found in all cases to en- proposition quoted the “a writer cent” precepts large part force moral opinion of note 5 concludes some community strange and ex- seem tendentiously critical remarks with cessively puritanical. analogy “Perhaps statement: the decision bromidic Amendment is Prohibition close. Since the ground can be sustained on the that while harsh, diligent most law seems search is people have bid at the auction to did not opera- made to cut down its more drastic automobile, eligible be to receive the it was tion; fact, the mind seems to. revolt at probable reasonably that would be the this That, its enforcement of 'hаrsher elements. case.”(!) Pickett, the Lot Contests and think, people meaning. I If want is real 1196, 45 tery Laws, 37. Harv.L.Rev. 1206 n. listening to waste their time in to radio pecuniary requirement of a considera hope or off-chance of may perhaps justified tion under some prizes, why not let winning some valuable however, Surely, is statutes. no attitude, widespread them do is it. That requisite of the federal Act. Fur where a which, course, I have considerable explanation requirement of con ther sympathy. draw the But I we should think away distinguish gift sideration to joke goes line when it so far as make Enterprises cases as Affiliated found such law, existing of an to turn understand- 5, Waller, Terry 28, 28, 40 1 Del. able, v. A.2d prohibition if into unliked, one Co., all, 257; v. & fate Furst A. G. Amusement 128 unintelligible. After 892; pro- 311, 25 A.2d Glover v. Mal the Prohibition Amendment shows N.J.L. loska, 107, per 216, 213 52 remedy. 238 Mich. N.M. A. eventual 77; Jones, 623, cases, 44 My L.R. State v. N.M. brothers do collect nor 107 Enterprises Gantz, 324; Affiliated problem. I. task in v. shall It a barren P.2d So, ognized too, services, currently consideration; value. such as which is book, State, selling are sufficient. Stewart v. 108 Tex.Cr.R. Loveland 661, Ill.App. 440, holding Bode, 2 also that 214 399. S.W.2d v. money be current coin need not of rec 394 Cir., 597; 86 F.2d purposes. Central States The tical The case cannot therefore Patz, Corp. D.C.S.D.Iowa,

atre v. 11 F. regarded precedent as a definitive dis- 566; Supp. State of Kansas ex rel. Beck posing of the issue. Co., 687, v. Fox Kansas Theatre 144 Kan. I appropriate think it therefore re- 698, P.2d A.L.R. with annota itеrate way summary my col- tion at State of Missouri rel. ex Mc- leagues suggest no workable dividing line Co., Kittrick v. Globe-Democrat Pub. 341 between what is “value” what is not in Mb. 110 S.W.2d 113 A.L.R. deciding participants what the give- in these with annotation at 1121. And not without away schemes have given. themselves On point many some immediate deci contrary, they seem to me to have re- upholding sions against F. T. C. orders the jected the understandable tests to which devices, lottery boards, use punch such as persuasive precedents point. fear, I there- candy. in the distribution of Consolidated fore, promote that our decision will serve to Mfg. C., Cir., Co. v. F. T. 199 F.2d allays. more my part confusion than it For .citing cases; Sweets America F. Co. of v. I plaintiffs’ complaints would dismiss the C., Cir., T. 109 F.2d 296. on the merits. and the seem reasoning cases cited to me compelling rather to sustain the Com ruling. doubt,

mission’s Were more in I I compunction uphold

should feel some position

defendants’ out of some deference respect

to the due the decisions made

agencies government having prime responsibility. But I do not resort think HOUSTON LAND v. DEEPWATER CO. principle necessary. to that Nor I find do SCOFIELD, Internal Collector of regard apt authority what I should Revenue. contrary. Perhaps I should make reference Civ. A. No. 6175. City to Garden Commerce Chamber of Wagner, D.C.E.D.N.Y., United States District Court F.Supp. Texas, S. Houston D. Division. statute, for that involved a similar Nov. covering U. S.C. the use of the mails lottery. In that case the court said that requisite “the consideration to a is a

contribution in property kind to fund or principle

to be distributed.” This think I upheld

cannot be and I understand the

plaintiffs support herein do not it. And so

further reflection has strengthened my be- validity position

lief in the I took

in dissent when the came case before us on

application stay appeal, pending Cir., for a

192 F.2d 240. Our consideration was not on merits, the result of a but as brief hear- A

ing on our motion calendar. motion for ‍‌‌​‌​‌‌‌‌‌​​‌​‌​‌‌‌‌‌‌‌​​‌‌​‌‌‌​​‌‌‌‌‌​‌​‌​‌‌‌​​‍stay ingenious scheme of of this local

neighborhood merchants for Christmas obviously very appealing;

sales was summary

further, required disposition in pressure time —it sub-

view filed 13 and decision was

mitted November stay, 1951; and denial of the

November beyond the matter the Christmas

carrying prac- moot for all season, question made the notes these sections United States Congressional Code, 1301, 1948 show that Sections 1302 and connection with the 382 lottery Code, statute does inal adopted Federal which the Commission lottery. 19, “lottery” 1950, August read, not define The term as follows : given popular meani should its usual or Give-Away Pro- "Lotteries ng.3 part the Federal Since it was application grams (a) for con- An — years many before Criminal Statute for so license, struction permit, renewal of the Federal was Communications Act license, any or other authorization for should, adopted 1934, “lottery” the term operation station, of a broadcast in interpreting the Federal Section 316 will be granted appli- where the Act, inter given Communications proposes cant to follow or continue to pretation which had received in cases policy practice follow a or of broad- construing former Section the Fed 336 of casting permitting or ‘the broadcast- Duchesne, eral Criminal v. Code.4 Brown any ing of advertisement of or infor- 595; 19 15 L.Ed. How. 60 U.S. lottery, mation concerning any gift, Harmel, Burnet v. U.S. 287 53 S.Ct. enterprise, scheme, or offering similar 199; Van Beeck v. Sabine 77 L.Ed. prizes dependent part in whole or in U.S, Co., Towing 81 57 S.Ct. chance, upon any lot or or list of the Camp L.Ed. N. R. B. W. L. prizes drawn or John awarded means of bell, Inc., Cir., 1947, 159 F.2d any such lottery, gift enterprise, scheme, any whether said list contains 'Adoption of the Commission’s part (See prizes.’ or all such Interpretative Rules. 1304). U.S.C. § interpretative rules in relation to “(b) The determination whether Section United Crim- particular States program comes within the basically language prompted adopt similar in said section because corresponding Re- the Postmaster General had ruled that practically “publications containing vision. advertisements fishing involving same Section 316 Title 47 Il.S.O. contests the three ele- (the Act) prize, consideration, Communications ments adopted in June 1934. chance” unmailable were under lot- inch) (§§ tery The four sections 1301-1304 laws. The contestants re- lottery, terminology “any quired pay entry use gift enterprise, ing prizes dependent same Legis- fee. — History offer- similar scheme lative of Section U. S. Code part Congressional Service, Congress, whole or 81st upon Session, 1950, 2, p. lot or chance”. Section 1304 Second Vol. respect Representa- another also the same ter- uses shows House of pro- minology as Section 1302 which tives’ Committee favored the Bill because mailing “any newspaper, judgment hibits cir- it was their “considered cular, publication any pamphlet, or Congress, enacting laws, containing any envisaged application kind advertisement never

Case Details

Case Name: American Broadcasting Co. v. United States

Court Name: District Court, S.D. New York

Date Published: Feb 5, 1953

Citation: 110 F. Supp. 374

Court Abbreviation: S.D.N.Y.