5th Circuit Rejects Broadcaster EEO Data Collection Rule
Requiring most broadcasters to gather and report equal employment opportunity data on workforce diversity is outside the FCC's legal authority, the 5th U.S. Circuit Court of Appeals ruled Monday. The Texas Association of Broadcasters, National Religious Broadcasters and American Family Association challenged the FCC's 2024 EEO order (see 2405130041). The FCC has broad authority to act in the public interest but "cannot invoke public interest to expand the scope of its authority to act in ways Congress has not authorized it to act," Judges Jennifer Walker Elrod, Edith Jones and Carl Stewart said in a 19-page decision (docket 24-18) written by Elrod.
Sign up for a free preview to unlock the rest of this article
Communications Daily is required reading for senior executives at top telecom corporations, law firms, lobbying organizations, associations and government agencies (including the FCC). Join them today!
The judges said that while the agency "undoubtedly has broad authority to act in the public interest," that authority must be tied to a distinct grant of authority in its statutes. They said the FCC hasn't shown that it's authorized to require broadcasters to file employment demographic data or analyze industry employment trends, "so it cannot fall back on 'public interest' to fill the gap."
Bloomberg Intelligence analyst Matt Schettenhelm posted on X that the ruling could affect the agency in a variety of ways. "One example: the FCC is exploring regulation of reverse transmission fees between broadcast networks and stations," he said. "Not clear the FCC has a distinct grant of authority to rate regulate those agreements."
The judges also said that the 1992 Cable Act mentions collecting employment data, but it's a restriction on FCC authority, not a grant of it. The court said Congress "expressly tethered" the FCC’s authority to collect EEO data to regulations that are no longer in effect. Since the agency lacks the authority, the judges said they wouldn't decide on the petitioners' arguments that the agency was violating broadcasters' First and Fifth Amendment rights or the Administrative Procedure Act.
FCC Chairman Brendan Carr wrote on X that the agency's 2024 EEO decision "was an unlawful effort to pressure businesses into discriminating based on race & gender." Carr and Commissioner Nathan Simington dissented on that 2024 order, which was adopted 3-2 (see 2402230074).
The 5th Circuit decision "should be a cautionary tale" to the FCC, Free State Foundation President Randolph May emailed. "As a matter of bureaucratic self-restraint and regulatory modesty," the FCC must "construe the congressional delegation of public interest authority narrowly." May said a standard "as concededly amorphous as 'the public interest'" will tempt regulators to use that authority aggressively. "While Democrat[ic] FCC commissioners surely have been far more prone in the past to take an overly expansive view of the agency’s public interest authority, the temptation exists regardless of party. It should be resisted."