The Federal Communications Commission's attempt to implement rule changes that would permit big media companies to dramatically extend their control over communications in the United States hit a surprising and potentially major road block Wednesday, when the Third US Circuit Court of Appeals halted implementation of the new rules.
After a two-hour hearing, the three-judge panel voted unanimously to stay the effective date for implementation of the FCC's rewrite of the ownership regulation and ordered that the prior ownership rules remain in effect pending a judicial review of the new rules. "This is a matter of significant public interest," explained Circuit Judge Julio Fuentes, while Circuit Judge Thomas Ambro suggested that the delay was appropriate because the courts need to resolve "a difficult, serious question" of whether the public interest was threatened.
The appeals court ruling was a stunning victory for the Prometheus Radio Project, a Philadelphia-based media activist group that is part of the broad coalition that has opposed FCC chair Michael Powell's push to implement radical changes in the rules governing media ownership at the national and local level.
Among the rule changes backed by Powell and the media companies is a scheme to increase the number of television stations that one company could own across the US to a level where one network could reach up to 45 percent of the national television audience. Another rule change is written to allow a single corporation to control the newspaper, television stations and radio stations in the same town.
Despite opposition from Common Cause, the National Organization for Women, the AFL-CIO, the Leadership Conference on Civil Rights, the National Rifle Association and dozens of other groups from across the political spectrum, the FCC voted 3-2 to make the rule changes on June 2. Since then, the House of Representatives has voted overwhelmingly to block implementation of the move to allow television networks to expand their reach at the national level, while the Senate is moving on a number of fronts to overturn all the rule changes. (Senate Appropriations Committee votes on several moves to roll back the FCC rule changes are expected Thursday.)
The leading Senate advocate for overturning the rule changes hailed the appeals court decision to issue the stay -- and the suggestions from the jurists that the rule changes raised significant public-interest concerns. "The ruling recognizes what I hope most of the Senate recognizes: These rules are inappropriate," said US Senator Byron Dorgan, D-North Dakota, who said the decision would boost Senate efforts to roll back the rule changes.
Most of the focus of the broad-based opposition to the FCC rule changes has been on Congress, which has been inundated with hundreds of thousands of calls, emails and letters from Americans who want to prevent media consolidation. Activists tend to believe that Congressional action will ultimately be needed to block the rule changes. But the appeals court decision to stay implementation of the rule changes provides breathing room for those seeking to prevent a new wave of media consolidations at both the national and local levels. And the fact that the decision of the appeals court was unanimous suggests that legal strategies could prove to be more significant than initially expected.
For the FCC and the communications giants it has sought to serve, the appeals court ruling was another indication that it is difficult for independent observers to take seriously the suggestion that limits on media mergers and acquisitions might in any way harm the public interest. When lawyers for the FCC and the intervenors on its behalf -- Fox Entertainment Group, Inc.; Fox Television Stations, Inc.; National Broadcasting Company, Inc.; Telemundo Communications Group, Inc.; and Viacom, Inc. -- claimed during a hearing regarding the suit that the interests of media conglomerates would be harmed by any delay of acquisitions under the new rules, Circuit Judge Anthony Scirica retorted, "You couldn't have done it (used the opening provided by the rule changes to acquire new media properties) a month ago. If you can't on September 4 but you can on Oct. 4 or Nov. 4, is there a difference?"
The court's ruling answered that question by declaring, "At issue in this litigation are changes adopted by the FCC that would significantly alter the agency's ownership rules for multiple media properties, including national television networks, local broadcast affiliates, radio stations, and newspapers. Petitioner has alleged harms from industry consolidation contending they would be widespread and irreversible if they occurred. The harm to petitioners absent a stay would be the likely loss of remedy (the ability to reverse mergers and acquisitions) should the new ownership rules be declared invalid in whole or in part. In contrast to this irreparable harm, there is little indication that a stay pending appeal will result in substantial harm to the Commission or to other interested parties... Given the magnitude of this matter and the public's interest in reaching the proper resolution, a stay is warranted pending thorough and efficient judicial review."
Those who have battled the FCC ownership rule changes on multiple fronts hailed the decision as a dramatic breakthrough. Though the court victory may only be temporary, US Rep. Bernie Sanders, I-Vermont, said, "The decision of the Third Court of Appeals is a major victory for the American people who, in my view, do not want to see media in America owned by a smaller and smaller number of huge multi-media corporations. This decision will give Congress time to pass legislation that will substantially increase media diversity, protect localism and allow for more competition."
The Philadelphia-based Prometheus Project has played a leadership role in advocating for the devlopment of low-power community radio stations. Arguing before the appeals court this week, lawyers for the group made the case that the ability to broadcast would be harmed by the expansion of already dominant media conglomerates. Samuel Spear, an attorney for Prometheus, said the group sought the judicial review because the rule changes would allow "the big media companies to grow bigger and to monopolize the industry more."
For the time being, at least, concern for the public interest in diverse ownerhip of the media has led the federal judiciary to prevent that growth.