A federal appeals court threw out the FCC’s cable ownership caps in a ruling highly critical of the commission. A three-judge panel of the U.S. Appeals Court for the District of Columbia Circuit agreed Friday with challenger Comcast that the 2007 ownership limit is “arbitrary and capricious.” The limit of 30 percent of U.S. cable subscribers doesn’t take into account the growth of pay TV by satellite and from telcos as alternatives to cable, the ruling said.

Fault lines emerged quickly at the newly reconstituted FCC, with Republican commissioners objecting in subtle but strong language as the commission Thursday approved three notices of inquiry, all touching on consumer protections and competition. The NOIs on wireless innovation and investment, consumer protections and the annual wireless competition report were approved 5-0. But Commissioners Robert McDowell and Meredith Baker signaled their concerns, especially on the wireless innovation item.

Comments are due Sept. 8 on a MusicFIRST Coalition petition for an FCC investigation into allegations stemming from a fight over performance royalties. The coalition asked the commission to look into whether radio stations have been “targeting and threatening” recording artists who have supported creating a performance royalty for terrestrial radio, a public notice said. The notice asks whether and how stations have targeted those artists, “including a refusal to air” their music. It also seeks comment on allegations that stations have refused to run ads that support the royalty, whether the NAB is leading a media campaign “which disseminates falsities” about the royalty, and whether some stations are evading public-file requirements by calling their on-air spots against the royalties PSAs. “We recognize that substantial First Amendment interests are involved in the examination of speech of any kind, and it is not clear whether remedies are necessary or available to address the actions alleged by MusicFIRST,” the notice said. Replies are due Sept. 23. MusicFIRST praised the commission for proceeding. The allegations raise troubling questions about broadcasters abusing the public interests, said Media Access Project CEO Andrew Schwartzman. “If these allegations are proven to be true, they will raise questions as to whether some radio stations deserve to receive free licenses for exclusive use of the public’s airwaves,” he said. The NAB said it will file comments in the proceeding and correct the “distortions” raised by the petition. “Contrary to suggestions in the petition, broadcasters are under no obligation to carry everything that is offered or suggested to them,” a spokesman said.

A three-judge panel of the 2nd U.S. Circuit Court of Appeals wants briefs in Fox v. FCC as it decides what to do with a Supreme Court remand of the New York court’s ruling against the commission’s so-called fleeting expletive policy (CD April 29 p2), said a participant. The appeals court could have decided the case again without accepting briefs, but the judges who made the original decision -- Peter Hall, Pierre Leval and Rosemary Pooler -- decided at a status hearing Wednesday they want them, said Media Access Project President Andrew Schwartzman. Briefs from broadcasters and intervenors like Schwartzman are due Sept. 16, the FCC’s brief is due a month later, and all replies must be made by Nov. 16, he said. The judges didn’t signal if they'll hear oral arguments in the case, but should they decide to do so testimony likely would be heard late this year, added Schwartzman.

FCC Chairman Julius Genachowski plans to put substantial emphasis on process, ensuring that the commission’s work is done through the its bureaus and offices, staffed by longtime experts. That emphasis, industry and commission officials said, marks a major change from the Kevin Martin FCC, in which power was concentrated in the chairman’s office. An immediate result, commission officials acknowledged, is that the FCC probably won’t make major policy calls in August.

The FCC has been picketed this week by the owner of a company awaiting approval to sell TV stations for about $20 million, said people monitoring the proceeding. Norm Shapiro of Weigel Broadcasting and his daughter were said to be the people outside the commission’s 12th Street SW entrance holding a sign saying “FCC Please Decide” and listing the application numbers for three low-power stations in South Bend, Ind., that Shapiro has agreed to sell to Schurz Communications. The bottom of the sign reads, “By July 31st. Thank you.” That’s the deadline for FCC approval that the companies set in a contract to transfer WMYS, a MyNetworkTV affiliate, WCWW (CW) and WBND (ABC), said lawyers including Media Access Project President Andrew Schwartzman. He’s representing Free Press, which asked the commission to block the deal because it would give Schurz stations in addition to a full-power TV station, two radio stations and the daily newspaper in South Bend that it already owns. “Grant of these applications would give one company an unprecedented degree of power over viewpoints and advertising in any market in the United States,” Schwartzman said. He said he hasn’t heard from the FCC whether it will approve or deny the transaction by today, as Shapiro seeks. Shapiro didn’t reply to a message seeking comment. “The commission is studying carefully all the issues raised in this transaction and is working to reach a decision as expeditiously as possible,” said an FCC spokesman. “As in all transactions, the parties can extend the termination date in their sales contract if they so choose.” The FCC, he added, has “no objections to lawful picketing.”

It may be a while before the FCC finishes dealing with a request for wide-ranging changes to radio rules made last week (CD July 21 p1) by a group representing minority- and women-owned stations, agreed six communication lawyers we surveyed. Four said several of the 17 points in the request may face opposition from some full-power broadcasters, such as a request for an FCC advisory committee to evaluate other uses for TV channels 5 and 6. Other parts of what the petition seeks may be politically controversial, including a section on Cuba. All surveyed said they think the actions requested by the Minority Media and Telecommunications Council, if approved, would help the radio industry, as ad sales are forecast by industry researcher BIA to fall 15 percent in 2009 to $14 billion and credit is hard to get.

Aides to new FCC Chairman Julius Genachowski is asking all companies and groups that seek meetings with the chairman’s office to fill out a five-question form explaining the purpose of the visit and how they have reached out first to the various bureaus and offices prior to meeting with the chairman.

FCC Chairman Julius Genachowski and Commissioner Robert McDowell exchanged letters discussing proposals for agency reform. Meanwhile, Genachowski’s office is asking all companies and groups that seek meetings with the chairman’s office to fill out a five-question form explaining the purpose of the visit and how they have reached out first to the various bureaus and offices prior to meeting with the chairman.

More thorough FCC ex parte filings with disclosure of who’s being represented were sought in a draft rulemaking notice circulated by Commissioner Michael Copps before he stepped down as acting chairman, commission officials said. The draft notice seeks comment on requiring that ex partes be more detailed than mentioning who attended a meeting and which rulemaking was discussed, they said.