Lead Opinion
Opinion for the Court filed by Circuit Judge GINSBURG.
Dissenting opinion filed by Circuit Judge WALD.
The Federal Communications Commission (Commission or FCC), in an order released April 10, 1984,
CAPH invoked 47 U.S.C. § 402(b)(6), which authorizes judicial review at the instance of any person “who is aggrieved or whose interests are adversely affected by” a Commission order. Intervenor Metromedia has challenged the Association’s standing to maintain the appeal,
Supreme Court precedent instructs that the constitutional components of “standing” to invoke judicial review are three: (1) personal injury (2) fairly traceable to the defendant’s unlawful conduct and (3) likely to be redressed by the requested relief. Valley Forge Christian College v. Americans United for Separation of Church and State, Inc.,
CAPH represents persons with physical handicaps. The Association claims injury stemming from Metromedia’s alleged longstanding neglect of its responsibilities to the handicapped public, particularly Metromedia’s failure to take reasonable steps to make television understandable to the hearing impaired and its failure to exert reasonable efforts to hire the handicapped. CAPH’s very account of Metromedia’s past performance, however, reveals the vulnerability of the Association’s present appeal to this court. The injuries recounted by CAPH plainly do not stem from the FCC’s approval of the transfer of ownership to the individual, John W. Kluge, who has in fact controlled Metromedia for many years:
The “standing” requirement is that the challenged action cause the injury. The Association, however, cannot fairly trace its ongoing injury — either in origin or in endurance — to the transfer in question. Instead, CAPH’s real plea is that the transfer will furnish no cure — it will not cause the injury to abate. This will not suffice. Under the test for judicial review that precedent prescribes, the alleged injury— here attributed to Metromedia’s inadequate
Application of the causality component of “standing” is not always clear and certain.
CAPH claims aggrievement because Metromedia has not fulfilled its public duty to the handicapped in the operation of its television stations. The Association’s complaint is properly and pointedly raised in a license renewal proceeding where, if it is borne out, the Commission could provide effective relief in the form of a refusal to renew the license.
In sum, CAPH’s alleged injury occurred before, existed at the time of, and continued unchanged after the challenged Commission action. CAPH, therefore, cannot tenably trace the asserted injury to the FCC’s approval of Metromedia’s transfer application. Rather, the injury CAPH describes traces to the Commission’s willingness to grant and renew licenses for stations that, in CAPH’s judgment, fail sufficiently to serve and hire the handicapped. CAPH, as the FCC has underscored, has standing to challenge licensing and renewal decisions on the basis of the “aggrievement” it asserts here, but it does not have a stake in the transfer proceeding in question of the kind necessary to invoke review by an Article III court.
Conclusion
CAPH lacks the injury in fact caused by the action at issue that is required by Article III. See Duke Power Co. v. Carolina Environmental Study Group,
Dismissed.
Notes
. Metromedia, Inc.,
. The Communications Act, 47 U.S.C. § 151 et seq. (1982), requires that the FCC follow certain procedures — including the acceptance and consideration of petitions to deny — before approving a transfer unless the transfer "does not involve a substantial change in ownership or control." Id. at § 309(c)(2)(B). The Commission has created a "long form” application procedure, which fulfills the statutory requirements, and a "short form” application procedure, for those transfers that fall within the statutory exception. On applications involving transfers of control, see generally Storer Communications, Inc. v. FCC,
. The Association's petition was joined by Sue Gottfried, acting individually and as a representative of the class of all the deaf and hearing impaired persons within the viewing area of Metromedia’s Los Angeles station KTTV-TV. See Metromedia, Inc.,
. CAPH raised no question as to the fact of Kluge’s long-term de facto control of Metromedia. Instead, relying upon Metromedia’s alleged disregard of the rights and interests of the handicapped in the course of Kluge’s stewardship, CAPH asked the Commission to refuse permission for completion of the proposed transfer
. The form was "short” only in comparative terms; Metromedia’s submissions ran over 600 pages. See Brief for Intervenor Metromedia, Inc. at 5.
. Metromedia also challenged CAPH’s standing before the Commission. The FCC reported, but did not rule on, Metromedia’s assertion that "petitioners [Gottfried and CAPH] lack the requisite standing, having failed to show that they would suffer actual injury ... as a result of the ... transfer.” Metromedia, Inc.,
. Differentiating ”[t]he 'fairly traceable' and ‘redressability’ components of the constitutional standing inquiry,” the Supreme Court observed that the causality inquiry "examines the causal connection between the [defendant’s — here, the FCC’s] assertedly unlawful conduct and the alleged injury, whereas the [redressability inquiry] examines the causal connection between the alleged injury and the judicial relief requested.” Allen v. Wright, — U.S. -,
. The Article III restrictions under which this court operates do not, of course, apply to the FCC. The Commission may choose to allow persons without Article III "standing” to participate in FCC proceedings, as it did in this case.
. Compare, e.g., Allen v. Wright, — U.S. -,
. In Allen v. Wright, — U.S. -,
. CAPH and its co-petitioner Gottfried would have standing to invoke judicial review of an FCC decision renewing the license of a Metromedia station in face of objection by petitioners that the station neglected the concerns of the handicapped. The causality requirement would be met because the renewal of the license would regenerate the continuing injury that CAPH’s constituency suffers as a result of the station's alleged practices: without a license renewal, the Metromedia station would be incapable of continuing those practices.
The stock transfer, we add, does not interfere with CAPH's ability to pursue objections to the renewal of Metromedia’s licenses. This is not a case in which the entry of a new operator through the device of a transfer or an assignment results in a situation fairly comparable to a license grant. See, e.g., Citizens Committee to Save WEFM v. FCC,
Indeed, in the license renewal proceedings for Metromedia’s Los Angeles television station, Gottfried and CAPH in fact raised objections identical to the ones they tendered to the FCC in this case. The Chief of the Video Services Division, on behalf of the Commission, considered and rejected the petitioners’ contentions on the merits and granted the license renewals. See Golden West Television, Inc., mimeo 3155 (March 15, 1985), reprinted in Supplemental Brief for Intervenor Metromedia, Inc., app. at
. The dissent observes that the FCC applies the same “public interest” standard in transfer cases as in license cases. See dissent at 830-831. This is true but irrelevant. CAPH would have standing in a license renewal proceeding not because of the public interest standard but because of the practical impact of a license renewal. The transfer here does not have a similar impact, i.e., continuance of the challenged conduct does not hinge on whether or not the transfer is approved. Thus, CAPH’s standing to contest the renewal of a license hardly qualifies it to challenge the transfer in question.
. The dissent argues that the FCC’s refusal to approve the transfer could ”contribut[e] to," or ”induc[e]” a decision by Metromedia to reform its ways with regard to the handicapped. See dissent at 827, 831. One suggested scenario is that other.shareholders, if not bought out, might "act[ ] to remedy the harm.” See dissent at 831. We think the prospect of scattered shareholders, none holding as much as five percent, rising up to defy Kluge in order to aid the handicapped implausible in the extreme. More plausibly, the dissent observes that Metromedia might choose to "reform its practices in order to obtain permission for the transfer.” Id. at 831. But so might the schools in Allen v. Wright, or the hospitals in Simon v. Eastern Kentucky Welfare Rights Organization, choose to reform in order to gain or retain favorable tax status. See supra note 10. We are at a loss to discern why the causal relationship between alleged injury and agency conduct was more speculative or attenuated in those cases than it is in this one. The transfer here, like the favorable tax treatment in those cases, we believe, does not the meet the “but for” standard described by the Supreme Court in Duke Power Co. v. Carolina Environmental Study Group,
. The dissent’s argument basing CAPH’s standing on procedural grounds does not alter our conclusion. The dissent apparently acknowledges that CAPH must allege an underlying substantive stake in the result of the decision in order to assert standing based on a procedural default. See dissent at 832-833. As the discussion above demonstrates, CAPH has no such stake. CAPH’s difficulty regarding standing does not lie in the merits of its arguments concerning the appropriateness of the short form procedure or the legality of Metromedia’s practices; rather, it inheres in the fact that the injury asserted lacks the requisite causal link to the challenged FCC decision.
Dissenting Opinion
dissenting.
I dissent from the panel’s conclusion that the California Association for the Physically Handicapped (CAPH) lacks standing to challenge the Federal Communications Commission’s (FCC or Commission) approval of a “short form” transfer
1. Standing Precedent in a Third-Party Causation Context
The majority holds that CAPH lacks standing because its injuries are not fairly traceable to the FCC’s approval of Metromedia’s transfer application. Its analysis, however, underestimates the ability of this causation requirement to accommodate the fact that the primary source of CAPH’s injury is the behavior of licensee Metromedia, although the defendant is the FCC. Plaintiffs such as CAPH can have standing to challenge an agency’s “behavior only as a means to alter the conduct of a third party, not before the court, who is the direct source of [their] injury.” Common Cause v. Department of Energy,
In such third-party causation cases, “ ‘[t]he mere fact that ultimate relief to the appellants depends on the actions of third parties does not by itself defeat appellants’ standing ... ’ [although it] ‘may make it substantially more difficult to meet the minimum requirement of Article III____’” Von Aulock v. Smith,
Cases in which the Supreme Court and this court have evaluated third-party causation problems do not yield a single inflexible test for standing, but rather can be sited along a continuum. At one end of the spectrum are those cases in which standing has readily been found because the agency’s authority is powerful enough to end the injurious conduct altogether by declaring it illegal.
In between are cases, like this one, involving “ ‘complex interrelationships between private and government activity,’ ” Community Nutrition Institute v. Block,
II. The FCC’s Power Over Transfers Under the Communications Act
The Communications Act requires the FCC to periodically assess and, if necessary, correct a licensee’s conduct at several critical points: before it grants an initial license, at renewal proceedings, and as a prerequisite to any major transfer of control or ownership. The panel concedes that licensing, renewal, and some transfer proceedings present an opportunity for the FCC to prevent or abate conduct which injures plaintiffs such as these, and that FCC errors in such proceedings can give rise to standing for dissatisfied viewers. But the majority attempts to draw a distinction between this transfer proceeding and transfer proceedings which are more like grant or renewal proceedings, in order to deny standing in this case while preserving standing in the others. Maj.Op. at 826-827 & n. 11. The panel’s attempted distinction is, however, based on a misunderstanding of the FCC’s authority over transfers under the Communications Act.
The Communications Act does not distinguish between transfers which are “fairly comparable to a license grant,” Maj.Op. at 826 n. 11, and those which are not. The only distinction between transfers made in the Act is between “short form” and “long form” transfers. See supra at 827 n. 1. All transfers involving a substantial change in ownership or control must be treated alike and, indeed, must be treated like license grants and renewals. Grants, renewals, and long form transfers are all governed by the same pre-grant protest procedures in § 309. 47 U.S.C. §§ 309(a), 310(d) (1982). In all of these proceedings, the FCC’s decision must be based on a finding that its action would serve the “public interest, convenience, and necessity.” 47 U.S.C. §§ 309(a), 310(d). The legislative history of the Communications Act Amendments of 1952 makes it clear that as regards transfers, “in applying the test of public interest, convenience, and necessity the Commission must do as though the proposed transferee or assignee were applying for the ... station license.” H.R. Rep. No. 1750, 82d Cong., 2d Sess. 12 (1952), U.S.Code Cong. & Admin.News 1952, 2234, 2246. This court has accordingly concluded that “[assignment applications are subject to the same standards and treated in the same manner as initial license applications unless they do not entail a substantial change in ownership or control.” Citizens Committee to Save WEFM v. FCC,
The statutory presence of an identical “public interest” standard for judging renewal and transfer cases is thus critical, although the majority refuses to concede its relevance. Maj.Op. at 827 n. 12. The majority, by distinguishing between transfers that involve new operators and those that do not, would limit the focus of transfer proceedings to the proposed transferee. The “public interest” standard which Congress mandated encompasses a much broader range of issues in both renewal and transfer proceedings, however, includ
III. CAPH Has Standing in this Case
A. Injury Due to Approval of Transfer
Thus, there is no doubt that the FCC could have refused to approve this transfer of ownership under its § 310(d) powers if it had accepted the allegations of discrimination in CAPH’s petition to deny. Instead, the Commission approved the transfer, allowing Metromedia’s management to increase its share of the voting stock by more than 50% and nullifying any possibility of other shareholders acting to remedy the harm.
A contrary FCC decision conditioning or denying the transfer could have ended or mitigated CAPH’s injury in one of two ways. First, such FCC action could have induced Metromedia to reform its practices in order to obtain permission for the transfer. The Commission itself must see such reform as likely or it would not consider a licensee’s past performance in transfer proceedings. See supra at 830. Second, such FCC action could clear the way for a different change of ownership to a more beneficent transferee.
While it is of course possible that Metromedia might continue its allegedly harmful conduct even if the FCC conditioned or denied the transfer, that scenario is not likely given the large economic benefits of the transfer and the relatively small cost of complying with an FCC order.
The majority’s analysis of the standing inquiry here appears to have been confused by the continuing nature of CAPH’s injuries. The majority sometimes recognizes that standing can be based on an ongoing injury whose endurance is attributable to the defendant, see Maj.Op. at 825, although at other times it seems to assume that agency action must precede injury to meet the causation requirement, id. at 825, 833 n. 13. But even an injury which predates an agency action can give rise to standing if the agency perpetuates or exacerbates the injury. The majority acknowledges this in the renewal context, finding that the FCC’s failure to halt Metromedia’s injurious conduct “would regenerate the continuing injury that CAPH’s constituency suffers as a result of the station’s alleged practices.” Maj.Op. at 826 n. 11. It steadfastly refuses, however, to recognize the same phenomenon in the transfer context. Yet in a transfer proceeding, as in a renewal proceeding, the FCC must consider whether the continued operation of the station will serve the public interest, convenience, and necessity. See supra at 830-831. Because the FCC has a statutory duty to “cure” injuries to the public interest in either type of proceeding, its failure to do so “regenerates” that injury and it will suffice for CAPH to assert that the FCC caused CAPH’s injury by failing to cure it. Cf. Maj.Op. at 825.
B. Injury Due to Use of “Short Form’’ Procedures
CAPH also alleges injury stemming from the FCC’s denial of procedural rights accorded to those objecting to “long term” transfers under the Communications Act. The Commission’s decision to allow use of the “short form” procedure permitted by § 309(c)(2)(B) compounded CAPH’s injury by denying it the opportunity to formally petition for denial of the transfer or request a hearing, 47 U.S.C. § 309 (1982), depriving “CAPH, its members, and other interested parties [of] the opportunity to scrutinize, comment, and participate in the proposed transfer, as required by law.” CAPH Notice of Appeal, Appendix at 76.
This court has recognized that the FCC’s failure to follow procedural requirements required by statute can give rise to standing for parties in interest. Gardner v. FCC,
Thus, the denial of “long form” procedural rights to CAPH may itself constitute an additional injury sufficient for standing. Congress can create new interests, including procedural rights, the invasion of which gives rise to standing.
Because CAPH is aggrieved by the underlying transfer, see supra at 832 & n. 12, it is injured additionally by the FCC’s allegedly illegal decision to use short form procedures. Although when Congress defines an injury, the other requirements of Article III “injury in fact” must still be met, Valley Forge Christian College v. Americans United for Separation of Church and State, Inc.,
In sum, I would confer standing upon CAPH to appeal the FCC’s approval of a transfer involving a substantial change in ownership or control. I do not find any
. The Communications Act bars a licensee from transferring or assigning a license "except upon application to the Commission and upon finding by the Commission that the public interest, convenience, and necessity will be served thereby." 47 U.S.C. § 310(d) (1982). The usual, "long form” procedure to be followed in approving a transfer is laid out in § 309 and provides for a
. Cf. Von Aulock,
. For example, in Association of Data Processing Serv. Orgs. v. Camp,
. In Simon v. Eastern Ky. Welfare Rights Org., indigents injured by the denial of hospital services challenged an Internal Revenue Service decision to permit tax-exempt treatment of hospitals without regard to whether they provided care to indigents. The Supreme Court held that the connection between the plaintiffs’ injuries and the IRS ruling was "speculative” because the denials of service could "result from decisions made by the hospitals without regard to the tax implications.”
[I]t is entirely speculative ... whether withdrawal of a tax exemption from any particular school would lead the school to change its policies. It is just as speculative whether any given parent of a child attending such a private school would decide to transfer the child to public school as a result of any changes in educational or financial policy made by the private school once it was threatened with loss of tax-exempt status.
. In Duke Power Co. v. Carolina Envtl. Study Group, Inc.,
. The majority also seeks to downplay its denial of standing in this proceeding by noting that CAPH would still have standing in other FCC proceedings involving Metromedia. Maj.Op. at 826 & n. 11. Standing in a particular case is not, however, affected by the existence of standing in another forum or for another plaintiff. See Valley Forge Christian College v. Americans United for Separation of Church and State, Inc.,
. The majority incorrectly assumes that complaints about a licensee’s past performance are relevant only in renewal proceedings. Maj.Op. at 826 n. 11.
. In assessing standing, this court must accept as true all allegations in a petitioner’s pleadings and construe the pleadings in favor of the petitioner. Warth v. Seldin,
. This scenario is not "implausible in the extreme.” Maj.Op. at 827 n. 13. Shareholder action could, for example, take the form of a resolution of the type frequently used to raise social policy concerns at annual meetings. Just as plausibly, several small shareholders could pool their stock into a voting block with enough leverage to elect some new directors. Cf. Storer Communications, Inc. v. FCC,
. The entire leveraged buy-out, only part of which involves broadcast licensees, is valued at $1.5 billion. Metromedia Br. at 5 n. 4. Even an FCC decision requiring significantly more programming to be close-captioned would add an average of only $2,200 to the cost of each hour of programming, an amount the ABC network has apparently found to be economically feasible. Pet.Supp.Br. at 10. In addition, a change in Metromedia’s policies would likely result from FCC denial or conditioning of the transfer because, at present, “despite the absence of any legal obligation, Metromedia has undertaken extraordinary efforts to serve the special needs of hearing impaired and other handicapped persons.” Metromedia Br. at 45.
. Thus, the fact that CAPH’s alleged injury "continued unchanged after the challenged Commission action,” Maj.Op. at 827, is precisely what gives CAPH standing.
. In Capital Legal Foundation, a public interest group alleging injury from an agency's failure to hold notice-and-comment rulemaking was found to lack standing when it conceded that it had suffered no injury from the substance of the underlying agency action.
. When Congress expands the scope of injuries for which litigants may seek redress in federal courts, those courts need not be as worried about the separation of powers concerns which underlie standing doctrine. 13A C. Wright, A. Miller & E. Cooper, Federal Practice & Procedure § 3531.13 at 79 (1984); 13 id. § 3531.2 at 398. Basing standing on violation of procedural rights explicitly created by Congress thus does not implicate the separation of powers concerns raised by the Supreme Court in Allen v. Wright, — U.S. -,
. Were the panel to reach the merits, I would hold that the FCC erred in not finding the leveraged buy-out to effect a substantial change in ownership. While there was no substantial change in control, the statute dictates use of long form procedures if there is a substantial change in either ownership or control. 47 U.S.C. § 309(c)(2)(B) (1982). A transfer of more than 50% of the voting stock of a company constitutes a substantial change in ownership under the Commission's own precedents, a result reinforced by the Commission's view that shareholders are the real owners of a company. See Storer Communications, Inc. v. FCC,
. S.Rep. No. 690, 86th Cong., 1st Sess. 2 (1959). The pre-grant protest procedures were also designed to ease the burden on applicants and the Commission. Id. See also 105 Cong.Rec. 7779-81 (1959) (remarks of Sen. Magnuson on introducing the bill).
. The amendments also made changes in the § 405 rehearing procedures in order to ensure objectors a more effective remedy for Commission errors both at the Commission level and in court. S.Rep. No. 690, supra note 14, at 829; H.R.Rep. No. 1800, 86th Cong., 2d Sess. 13-14 (1960).
. See Committee for Full Employment,
