SINCLAIR TAKES STAND IN COURT AGAINST LOCAL OWNERSHIP CAP
Sinclair Bcst. pushed case to overturn FCC decision on ownership cap, in oral argument at U.S. Appeals Court, D.C., Mon. Under what Media Access Pres. Andrew Schwartzman called “unusually harsh questioning,” by Judges David Sentelle, Judith Rogers and Stephen Williams, Sinclair argued that FCC order that limits ownership to maximum of 2 stations, where there are 8 independently owned TV stations -- “8 voices rule” -- was unconstitutional. Determination on legality of common ownership of TV stations should be left to Dept. of Justice on market-to-market basis under antitrust laws, Sinclair argued.
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“This panel has in the past been very supportive of broadcasters,” Schwartzman said. He said if court reversed decision, “it’s Katy-bar-the door” and would represent “deregulatory mandate.” He said “remand rather than outright reversal” would have less of impact. In addition to Sinclair, Pegasus and Quorum may be significantly affected by ruling, Schwartzman said. Decision is expected within 120 days. FCC counsel Joel Marcus, who argued case, refused comment afterward.
Judges were interested in distinctions between radio and TV ownership rules. Marcus told panel there was “a zone of reasonableness” when it came to Commission order putting cap on number of properties that could be owned. He said “it was a judgment call” and number had to be based on “policy considerations. There’s no explicit statement why it was 8 instead of 3 stations,” Marcus said in response to questioning by Rogers: “It’s not a data-driven number. There’s no clear answer. The Commission was just exercising judgment that was given by Congress.” FCC’s failure to allow existing TV local marketing agreements to continue was inconsistent with controlling statue and exceeds agency’s authority, Marcus said.
“Radio is less important to market than TV,” Marcus said: “It was reasonable to be more cautious in TV than radio market.” He called it “substantial deregulatory situation.” He said if Commission had reimplemented “duopoly rule,” 2 sides wouldn’t be in court. Rogers also was interested in definition of voices. Marcus said TV simply was “different from radio,” and “the most important medium in the country,” citing reports that 93% of U.S. residents looked at network TV programs and 62% viewed cable or DBS. “We've established that network TV is the preferred choice,” Marcus said. “It’s hard to defend the survey because I don’t know the methodology that was used.” Sinclair attorney Barry Gottfried said FCC needed to find “a different way to regulate” marketplace.