FCC v. Prometheus Radio Project

Whether the court of appeals erred in vacating as arbitrary and capricious the FCC orders under review, which, among other things, relaxed the agency’s cross-ownership restrictions to accommodate changed market conditions.

This case has been consolidated with Nat’l Ass’n of Broad. v. Prometheus Radio Project. Section 202(h) of the Telecommunications Act of 1996 requires the Federal Communications Commission (FCC) to “repeal or modify any regulation it determines to be no longer in the public interest.”  Since 2002, the FCC has sought to remove a decades-old ban on common ownership of newspapers and broadcast stations in a single market that it has determined no longer serves the public interest.  In three cases over seventeen years, the same divided panel in the Court of Appeals for the Third Circuit has vacated the FCC’s attempts to change its own rules.  The Third Circuit vacated on the grounds that the FCC has not sufficiently studied the impact of its regulatory change on minority and female ownership of broadcast stations.  Petitioners argue that the FCC has the discretion to change its rules in the public interest and the Third Circuit is improperly impeding its ability to do so.  Petitioners argue that the FCC has the power to determine what is in the public interest and regulate accordingly.  National Broadcasting Co. v. United States, 319 U.S. 190, 225 (1943).  When data are insufficient or inconclusive, the courts must give substantial deference to an agency’s policy conclusions.  Motor Vehicle Mfrs. Ass’n of the U.S., Inc. v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983).  By repeatedly vacating regulatory changes based on concerns over minority and female ownership of broadcast stations, Petitioners argue the Third Circuit has substituted its own judgment for the FCC’s.