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Eagle Broadcasting Group, Ltd. v. Federal Communications Commission

April 28, 2009

EAGLE BROADCASTING GROUP, LTD., APPELLANT
v.
FEDERAL COMMUNICATIONS COMMISSION, APPELLEE



Appeal of an Order of the Federal Communications Commission.

The opinion of the court was delivered by: Edwards, Senior Circuit Judge

Argued January 8, 2009

Before: ROGERS and BROWN, Circuit Judges, and EDWARDS, Senior Circuit Judge.

In 1996, Congress passed § 403 of the Telecommunications Act of 1996, Pub. L. No. 104- 104, 110 Stat. 56 ("the Telecommunications Act"), which amended the Communications Act of 1934, 47 U.S.C. § 151 et seq. ("the Act"). Section 403, as enacted in 1996, added a new subpart (g) to § 312 of the Act, providing in relevant part:

If a broadcasting station fails to transmit broadcast signals for any consecutive 12-month period, then the station license granted for the operation of that broadcast station expires at the end of that period, notwithstanding any provision, term, or condition of the license to the contrary.

47 U.S.C. § 312(g) (1996). In 2004, after the occurrence of the events giving rise to this case, Congress added the following language to the provision:

except that the Commission may extend or reinstate such station license if the holder of the station license prevails in an administrative or judicial appeal, the applicable law changes, or for any other reason to promote equity and fairness.

47 U.S.C. § 312(g) (2004).

At issue in this case is a decision by the Federal Communications Commission ("FCC" or "Commission") declaring that the broadcast license of Eagle Broadcasting Group, Ltd. ("Eagle") had expired pursuant to § 312(g). Eagle was licensed to operate radio station KVEZ(FM) from a site known as "Black Peak" (the "Black Peak site") but ceased broadcasting in June 2001 due to interference and land use issues. The FCC granted Eagle a temporary license to operate from its studio, but the station again went silent on December 20, 2002. Subsequently, Eagle applied to the Commission for a construction permit to broadcast from a new site in the Buckskin Mountains (the "Buckskin site"), but it failed to obtain the necessary clearance from the Federal Aviation Administration ("FAA") and the FCC. Eagle then failed for 12 consecutive months to resume broadcasting from its licensed site at Black Peak.

When the FCC determined that Eagle had not resumed broadcasting as of December 20, 2003, it declared that Eagle's license had expired pursuant to § 312(g). Eagle protested, arguing that its license had not expired because it had transmitted broadcast signals from the Buckskin site in November 2003. Eagle contended that it did not matter that its broadcast transmissions from the Buckskin site were unauthorized. The FCC rejected Eagle's petitions for reconsideration. Pointing to § 301 of the Act, the Commission noted that the Act clearly prohibits any person from transmitting broadcast signals except with a license granted by the Commission. The FCC therefore held that Eagle's unauthorized broadcasts from the Buckskin site were insufficient to avoid the strictures of § 312(g). See Eagle Broadcasting Group, Ltd., 23 F.C.C.R. 588 (2008) [hereinafter, Order].

Eagle's principal argument on appeal is that the station did "transmit broadcast signals" within the meaning of § 312(g) before the one-year deadline. Eagle argues that Congress would have inserted the word "authorized" in the statute had it intended for the provision to be interpreted as the FCC has interpreted it in this case. According to Eagle, the plain language of the statute allows a station to transmit any signals from any location to avoid the automatic expiration of a license under § 312(g). We disagree. The FCC acted well within its statutory authority and pursuant to reasoned decisionmaking in rejecting Eagle's claim that unauthorized broadcasts by unlicensed stations are adequate to avoid license termination under § 312(g). And, contrary to Eagle's claims, the FCC's action was neither arbitrary and capricious nor an abuse of discretion.

I. BACKGROUND

A. Statutory and Regulatory Background

Section 301 of the Act bans any person from transmitting signals by radio "except under and in accordance with this chapter and with a license . . . granted under the provisions of this chapter." 47 U.S.C. § 301. The Act defines broadcasting as the "dissemination of radio communications intended to be received by the public." Id. at § 153(6).

Prior to the enactment of the Telecommunications Act, the Commission addressed "silent stations" -- radio stations which were authorized to broadcast but were silent -- in one of two ways. The FCC would either grant the station temporary authority to remain off the air if it found such a grant to be in the public interest, or it would initiate a revocation proceeding, which often included lengthy procedural requirements such as an evidentiary hearing. See Implementation of Section 403(l) of the Telecommunications Act of 1996 (Silent Station Authorizations), 11 F.C.C.R. 16,599, 16,599 (1996) [hereinafter, Silent Station Authorizations].

In 1996, the Telecommunications Act added a new subsection to the Act, providing for the automatic expiration of a station's license when it failed to broadcast for 12 months. The new provision stated:

If a broadcasting station fails to transmit broadcast signals for any consecutive 12-month period, then the station license granted for the operation of that broadcast station expires at the end of that period, notwithstanding any provision, term, or condition of the license to the contrary.

47 U.S.C. § 312(g) (1996). After the occurrence of the events giving rise to this case, Congress amended § 312(g) by adding language giving the Commission discretion to "extend or reinstate" a license in order to, inter alia, "promote equity and fairness." See 47 U.S.C. § 312(g) (2004) (amended by Consolidated Appropriations Act, 2005, Pub. L. No. 108-447, 118 Stat. 2809 (2004)).

Because broadcast towers may interfere with air traffic safety, § 303(q) of the Act directs the Commission to mandate broadcast tower safety features, such as "painting and/or illuminination," when "there is a reasonable possibility" that a tower "may constitute . . . a menace to air navigation." 47 U.S.C. § 303(q). The Commission's rules provide that an applicant who proposes to construct a broadcast antenna with certain specifications must notify the FAA of the proposed construction. See generally Construction, Marking, and Lighting of Antenna Structures, 47 C.F.R. § 17.1, et seq. (2009). The rules make it clear that:

(a) Effective July 1, 1996, the owner of any proposed or existing antenna structure that requires notice of proposed construction to the Federal Aviation Administration must register the structure with the Commission. . . .

(b) . . . . [E]ach owner of a proposed structure . . . must submit a valid FAA determination of "no hazard."

(d) If a final FAA determination of "no hazard" is not submitted along with FCC Form 854, processing of the registration may be delayed or disapproved.

Id. § 17.4.

B. Facts

Through its owner, Maurice W. Coburn, Eagle acquired control of radio station KVEZ(FM) in 1995. KVEZ(FM) was licensed to operate from a site known as Black Peak in the community of Parker, Arizona, but ceased broadcasting from the site on June 23, 2001 due to interference and land use issues.

See Order,23 F.C.C.R. at 589; Letter from Maurice W. Coburn to Secretary of FCC (June 5, 2002), reprinted in Joint Appendix ("J.A.") 145. On February 15, 2002, Eagle filed an application with the FCC for a construction permit to move to the Buckskin site. See Order, 23 F.C.C.R. at 589; Application for Construction Permit, J.A. 146.

On April 24, 2002, the Commission's staff (the "Staff") notified Eagle of a deficiency in the Buckskin site application. Order, 23 F.C.C.R. at 589. Eagle had failed to respond to a question that asked for a Commission tower registration number -- a number an applicant receives after a FAA determination that the proposed broadcasting facility poses no hazards to air navigation. Because the Buckskin site is within the glide scope of air traffic using the Avi Suquilla Airport in Parker, Arizona, the FCC stated that FAA approval of the proposed tower was necessary. Id. at 594; FCC's Br. at 6. The Staff informed Eagle ...


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