FCC Expected to Defend Broadcast Ownership Rules in 8th Circuit

The FCC appears poised to defend the regulations on Wednesday despite Chairman Brendan Carr’s vocal opposition to ownership rules, and several attorneys told us the court’s ruling may have little ultimate impact on Carr’s deregulation agenda. Broadcasters told us they're optimistic about the case, given the demise of Chevron deference and the new forum. “The fact that we are not in front of that same panel gives me hope that we'll get a different result,” said Robert Folliard, Gray Media senior vice president-government relations and distribution.

The 2018 quadrennial review order extended the FCC’s prohibition on owning two top-four stations in a single market to low-power stations and multicast streams. The order was approved 3-2 in December 2023 but was a result of the 2018 iteration of the agency’s quadrennial review of ownership rules. Both Republicans dissented from the order, including then-Commissioner Carr, who blasted the FCC majority for taking “an ostrich-like” view of media competition.

Petitioners Zimmer Radio, Nexstar, NAB, Beasley Media and Tri-State Communications have argued that the order violated the Communications Act because it didn’t roll back any broadcast ownership rules and ignored the competition for media advertising dollars. The broadcasters have called for the 8th Circuit to vacate not only the 2018 QR order, but also local TV and radio ownership limits, because the FCC has failed to justify retaining them. The FCC has argued that the statutory language requiring quadrennial reviews doesn’t compel the agency to deregulate and that broadcasters haven’t shown they face competition in local programming.

The FCC is expected to defend the 2018 QR order even though Carr opposed it, broadcast and public interest attorneys told us. The agency filed a letter this week with the court calling attention to relevant rulings in the 11th Circuit (see 2503110060). “The FCC, except in the most egregious cases, defends its positions," said United Church of Christ Media Justice Ministry attorney Cheryl Leanza, who filed an amicus brief supporting the FCC position. "The FCC has an institutional interest in defending its decisions.”

In an oral argument earlier this year, the FCC backed off defending portions of its equal employment opportunity order, which Carr had opposed as a commissioner (see 2502040061). In that case, an agency attorney told the court that the FCC was obligated to defend orders approved by the full commission until a quorum of commissioners decides otherwise. With the FCC at 2-2, a majority vote against defense of the QR order isn’t likely. The FCC didn’t respond to requests for comment.

Since 2003, the same panel of judges in the 3rd Circuit has resolved challenges to the FCC’s quadrennial reviews. In four separate cases headed by the Prometheus Radio Project, those judges repeatedly remanded the FCC’s orders loosening ownership rules back to the commission and retaining jurisdiction over the case. The panel lost control of the case after a unanimous U.S. Supreme Court ruling in 2021 against Prometheus that vacated the 3rd Circuit’s remand. The 3rd Circuit “held this case for themselves, for decades, which is a violation of the way this process is supposed to work,” said broadcast attorney Jack Goodman, a former NAB general counsel. “I think even a different panel at the 3rd Circuit would have changed things,” said University of Minnesota media law professor Christopher Terry. “You basically had the same decision come out of the 3rd Circuit four times in a row.”

The 8th Circuit panel hearing the case next week consists of three judges appointed by former President George W. Bush: Raymond Gruender, Duane Benton and Bobby Shepherd.

Chevron deference will likely be a consideration in the case, attorneys told us. The FCC brief defending the rules repeatedly invokes the agency’s discretion to make decisions about whether rules should remain, Goodman said. To Leanza, the FCC has “a good, solid case” and has traditionally been granted latitude over broadcast regulation. In a post-Chevron world, the court can give less deference to the FCC's arguments, said Common Cause Director-Media and Democracy Ishan Mehta. Common Cause was one of the parties behind Leanza’s amicus brief.

Ultimately, the court’s ruling may have little effect on what regulations bind broadcasters, attorneys said. Carr is seen likely to eventually roll back ownership rules whether or not the court upholds the FCC order. Any changes ordered by the court or Carr’s ownership deregulatory efforts would likely be handled by the agency as part of the currently open 2022 quadrennial review proceeding, which is expected to be issued by the end of the calendar year, Terry said. “You’re in the same spot no matter how you get there.”