Stay Reply Memo (D.C. Circuit)
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Transcript of Stay Reply Memo (D.C. Circuit)
Nos. 15-1264, 15-1346 ________________________________________
IN THE UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT
________________________________________
MAKO COMMUNICATIONS, LLC, FREE ACCESS & BROADCAST TELEMEDIA, LLC, and WORD OF GOD FELLOWSHIP, INC., et al.,
Petitioners,
v.
FEDERAL COMMUNICATIONS COMMISSION, et al.,
Respondents. ________________________________________
REPLY MEMORANDUM IN SUPPORT OF PETITIONERS’
JOINT MOTION TO STAY PENDING APPELLATE REVIEW
(Ruling Requested by March 28, 2016) _______________________________________
GLENN B. MANISHIN R. SCOTT CAULKINS PARADIGMSHIFT LAW LLP CAULKINS & BRUCE PC 6735 Breezy Drive, Suite 101 2300 Wilson Blvd., Suite 240 Warrenton, VA 20187 Arlington, VA 22201 202-256-4600 703-558-3664 Counsel for Petitioners Free Access & Counsel for Petitioner Mako Broadcast Telemedia LLC and Word Communications, LLC of God Fellowship, Inc. Dated: March 16, 2016 [Other counsel on next page]
C. BOYDEN GRAY AARON P. SHAINIS ADAM J. WHITE LEE J. PELTZMAN BOYDEN GRAY & ASSOCIATES PLLC SHAINIS & PELTZMAN, CHARTERED 801 17th Street, N.W., Suite 350 1850 M Street, N.W., Suite 240 Washington, DC 20006 Washington, DC 20036 202-955-0620 202-293-0011 Counsel for Petitioners Free Access & Counsel for Petitioner Mako Broadcast Telemedia LLC and Word Communications, LLC of God Fellowship, Inc. ROBERT OLENDER KOERNER & OLENDER PC 7020 Richard Drive Bethesda, MD 20817 301-468-3336 [email protected] Counsel for Petitioner Word of God Fellowship, Inc.
i
TABLE OF CONTENTS
TABLE OF AUTHORITIES .............................................................................. ii
GLOSSARY ...................................................................................................... iv
ARGUMENT ...................................................................................................... 1
I. THE COURT HAS JURISIDICTION OVER THESE CASES ................ 3
II. A STAY PENDING APPELATE REVIEW IS FULLY WARRANTED UNDER THE SETTLED CRITERIA FOR INTERIM RELIEF .............. 4
A. Irreparable Injury ............................................................................ 5
B. The Public Interest & Third-Party Harms ...................................... 6
CONCLUSION ................................................................................................. 10
ii
TABLE OF AUTHORITIES
Cases and Judicial Orders
Burlington Truck Lines, Inc. v. United States, 371 US 156 (1962) .................... 3
*CityFed Fin. Corp. v. Office of Thrift Supervision, 58 F.3d 738 (D.C. Cir. 1995) ................................................................................................... 5
*Chevron, U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837 (1984) ........................................................................................................... 3
Omnipoint Corp. v. FCC, 78 F. 3d 620 (D.C. Cir. 1996) ................................... 8
Serono Labs., Inc. v. Shalala, 158 F.3d 1313 (D.C. Cir. 1998) .......................... 5
* WMATA v. Holiday Tours, Inc., 559 F.2d 841 (D.C. Cir. 1977) ...................... 4
Order Denying Mandamus Relief, In re Videohouse, Inc., No. 15-1486 (D.C. Cir. Dec. 30, 2015) .................................................................................. 10
Statutes
47 U.S.C. § 1452(b)(5) ................................................................................ 1, 2-3
47 U.S.C. § 1452(f)(4) ........................................................................................ 8
47 U.S.C. § 309(j)(3)(A) ...................................................................................... 8
Regulations
47 C.F.R. § 1.2105(c)(1) ..................................................................................... 9
47 C.F.R. § 1.2205(b) .......................................................................................... 9
Administrative Decisions
Expanding the Economic and Innovation Opportunities of Spectrum Through Incentive Auctions, GN Docket No. 12-268, Report and Order, 29 FCC Rcd. 6567 (rel. June 2, 2014) ............................................................................. 2, 7-10
Expanding the Economic and Innovation Opportunities of Spectrum Through Incentive Auctions, GN Docket No. 12-268, Notice of Proposed Rulemaking, 27 FCC Rcd. 12357 (rel. Oct. 2, 2012) ............................................................... 7
iii
Expanding the Economic and Innovation Opportunities of Spectrum Through Incentive Auctions, GN Docket No. 12-268, Order Denying Stay Motion DA 16-262 (Media Bur. rel. Mar. 10, 2016). ..................................... 1, 2, 6, 9-10
Other
Emergency Motion for Stay, The Videohouse, Inc. v. FCC, No. 16-1060 (D.C. Cir. filed Feb. 29, 2016) ............................................................................ 6
FCC Response to Motion to Expedite, The Videohouse, Inc. v. FCC, No. 16-1060 (D.C. Cir. filed Feb. 19, 2015) ....................................................... 8
Gary Epstein, Chair, FCC Incentive Auction Task Force, “Incentive Auction Progress Report,” FCC Blog (Oct. 24, 2014 12:00 p.m.) ................................... 7
Tom Wheeler, “The Path to a Successful Incentive Auction,” FCC Blog (Dec. 6, 2013 10:45 a.m.) ................................................................................... 7
iv
GLOSSARY
Commission Federal Communications Commission
FCC Federal Communications Commission
First Report & Order The FCC’s 2014 Report and Order in GN Docket No. 12-268, cited two entries below under “Orders”
LPTV Low-Power Television
NPRM Notice of Proposed Rulemaking
Orders The FCC decisions under review in these cases: Expanding the Economic and Innovation Opportunities of Spectrum Through Incentive Auctions, GN Docket No. 12-268, Report and Order, 29 FCC Rcd. 6567 (rel. June 2, 2014), and Expanding the Economic and Innovation Opportunities of Spectrum Through Incentive Auctions, GN Docket No. 12-268, Second Order On Reconsideration, 30 FCC Rcd. 12016 (rel. June 19, 2015)
Second Order On Reconsideration The FCC’s 2015 Reconsideration Order in GN Docket No. 12-268, cited one entry above under “Orders”
Spectrum Act Title VI of the Middle Class Tax Relief and Job Creation Act of 2012, Pub. L. No. 112-96, 126 Stat. 156, codified in part at 47 U.S.C. §§ 1451-57
Stay Denial Order Expanding the Economic and Innovation Opportunities of Spectrum Through Incentive Auctions, GN Docket No. 12-268, Order Denying Stay Motion, DA 16-262 (Media Bur. rel. Mar. 10, 2016)
v
TVStudy The FCC’s custom-designed “OET-69” software to be used to calculate interference among pre and post-auction broadcasters and to reorganize the broadcast television spectrum in the second phase of the incentive auction
The FCC argues that Joint Petitioners face no injury sufficiently certain or
irreparable to justify a stay, on the ground that the incentive spectrum auction’s
impact on LPTV broadcasters “depends on a host of factors” it insists cannot be
known now.1 Yet the Commission also claims the auction must proceed promptly
on March 29, 2016 because “any delay” necessarily harms the public interest and
third parties.2 This “Catch 22” inexplicably asserts that Petitioners are at the same
time too early and too late to seek interim relief from this Court. The FCC cannot
have it both ways; its position is wrong and unsubstantiated.
ARGUMENT
With respect to the Spectrum Act provision prohibiting the FCC from
“alter[ing]” LPTV stations’ “spectrum usage rights,” 47 U.S.C. § 1452(b)(5), the
FCC’s response adds nothing substantively new to its previous filings. The Com-
mission claims once again that its 2014 and 2015 Orders do not alter LPTV
stations’ rights because, as secondary services, they are subject to so-called “dis-
placement” by primary services. FCC Opp. Br. at 1, 3, 9-11; Stay Denial Order at
3-4 ¶ 7. That conclusory assertion was fully addressed in Petitioners’ merits briefs
and motion to stay; LPTV stations are assuredly “secondary” to full-power broad-
1 FCC Opp. Br. at 15, citing Expanding the Economic and Innovation
Opportunities of Spectrum Through Incentive Auctions, GN Docket No. 12-268, Order Denying Stay Motion, DA 16-262, at 3-4 ¶ 7 (Media Bur. rel. Mar. 10, 2016) (“Stay Denial Order”). The FCC issued that Media Bureau staff order shortly after Petitioners filed their stay motion in this Court.
2 FCC Opp. Br. at 17, 18.
2
casters in terms of interference, but their “rights” in general are not “secondary” to
other stations, and LPTV stations certainly are not “secondary” to the unlicensed
services that the FCC is prioritizing in the Orders. Stay Mot. at 7-14; Opening Br.
in No. 15-1264, at 20-26 (filed Dec. 4, 2015); Opening Br. in No. 15-1346, at 44-
58 (filed Jan. 11, 2016); Reply Br. in No. 15-1264, at 3-25 (filed Feb. 26, 2016);
Reply Br. in No. 15-1346, at 3-6, 17-22 (filed Mar. 7, 2016).
As Petitioners explained in their briefs, § 1452(b)(5) unambiguously pro-
hibits the FCC from “alter[ing] the spectrum usage rights of low-power television
stations” in its reorganization of television spectrum. The Commission offers
literally no substantive interpretation of § 1452(b)(5). FCC Opp. Br. at 3-5, 6, 9-
11; Stay Mot. at 11 & n.15; Reply Br. in No. 15-1346, at 6-11, 17-21. The FCC’s
argument that LPTV stations’ rights are not “altered” by their displacement to
accommodate new users in the to-be-repurposed TV spectrum (FCC Opp. Br. at
12; Stay Denial Order at 2 ¶ 5) continues to avoid the fact that LPTV is and
remains “primary” relative to the unlicensed services its auction band plan
explicitly promotes.3 The contrary position now espoused by the FCC’s Orders
3 Stay Mot. at 11 & n.15. The FCC’s lawyers for the first time contend that
Petitioners’ argument on unlicensed services is premised on a “misunderstanding” of the Orders, FCC Opp. Br. at 12, which they claim do not address unlicensed wireless. To the contrary, the Orders do expressly prioritize unlicensed spectrum uses over LPTV. Reply Br. in No. 15-1346 at 23, quoting First Report & Order ¶ 8 (“the rules we adopt in this Order will make a significant amount of spectrum available for unlicensed use, a large portion of it on a nationwide basis”) (emphasis
3
reverses decades of its own rules and policies on the limited, interference-based
restrictions on “secondary” broadcasters.
Petitioners do not argue that the Commission “must protect” LPTV “from
potential displacement as a result of the auction and repacking process.” FCC Opp.
Br. at 7. That straw man was also squarely addressed in our briefs; Petitioners’
actual argument, which the FCC never engages, is that depriving LPTV stations of
their current channels, without an alternative, “alters” their spectrum usage rights.
See Reply Br. in No. 15-1346, at 27.
Thus, the FCC’s Orders are at least “subject to substantial challenge,” D.C.
CIR. HANDBOOK at 33, all that is required for likelihood of success. In this case,
Petitioners’ position comports with § 1452(b)(5)’s unambiguous language, while
the FCC’s position strips that statutory provision of all substantive meaning.4
I. THE COURT HAS JURISIDICTION OVER THESE CASES
The agency recaps its merits brief’s arguments against the standing of all of
the Joint Petitioners and the Court’s statutory jurisdiction. FCC Opp. Br. at 7-8.
These arguments should be rejected, for the reasons set forth in Petitioners’ briefs
added). An agency decision of course cannot be sustained on the basis of argu-ments made only by counsel on appeal. E.g., Burlington Truck Lines, Inc. v. United States, 371 US 156, 168-69 (1962).
4 Chevron, U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837, 842-43 (1984).
4
and supporting declarations. Reply Br. in No. 15-1264, at 26-34; Opening Br. in
No. 15-1346, at 40-43 & Exhs. A, B; Reply Br. in No. 15-1346, at 13-16.
For instance, Free Access asserts its own interests; it is not “like a third-
party shareholder [whose] claims of injury are wholly derivative of injury to the
LPTV station licensees.” Compare FCC Opp. Br. at 7 with Reply Br. in No. 15-
1346, at 14, 16 (FCC does not “respond directly to either theory of [Free Access’s]
standing—the economic impact injury, or the business decision injury…. Free
Access has a direct interest in this case. It is not litigating simply to vindicate a
third party’s interests…. It is not a shareholder.”). Similarly, the FCC recognized
that Mako was appealing the same two orders as Free Access, so that the FCC
“does not claim, nor could it given its concession that Mako was appealing both
orders, that it was prejudiced by Mako’s not referencing the underlying [First]
Report and Order in its petition for review.” Reply Br. in No. 15-1264, at 28.
Because the Commission’s response merely cites (and adds nothing) to its
prior arguments, Joint Petitioners respectfully refer the Court to their briefs on the
merits with regard to standing and jurisdiction.
II. A STAY PENDING APPELATE REVIEW IS FULLY WARRANTED UNDER THE SETTLED CRITERIA FOR INTERIM RELIEF A motion to stay requires substantial showings, but not “mathematical
probabilit[ies].” WMATA v. Holiday Tours, Inc., 559 F.2d 841, 843 (D.C. Cir.
1977). Like an injunction, a stay is appropriate where there is “a particularly strong
5
likelihood of success on the merits even if there is a relatively slight showing of
irreparable injury.” CityFed Fin. Corp. v. Office of Thrift Supervision, 58 F.3d 738,
747 (D.C. Cir. 1995).5 The law certainly doesn’t require what the FCC would
demand of Joint Petitioners, and the agency’s zeal to marginalize Petitioners’ sub-
stantial likelihood of irreparable harm leads the FCC to contradict its own deter-
minations in the Orders below.
A. Irreparable Injury
The FCC insists that Petitioners’ injuries are too speculative, despite the fact
that its Orders repeatedly recognize that the auction “will” force “many” LPTV
stations to lose their channels (to be “displaced” under the FCC’s terminology) in
the spectrum reorganization phase. See, e.g., Stay Mot. at 12-15. As the Orders
show, it is certain that (i) many if not most of the thousands of existing LPTV
stations will lose their channel assignments in the phase two spectrum reorg-
anization, and (ii) there will “likely” not be enough spectrum left to accommodate
them in the reorganized broadcast television band after the Commission concludes
its so-called “repack.” Stay Mot. at 4-5, 12-14, 15 n.19 (collecting citations). These
imminent injuries to LPTV stations and those who invest in them (including Joint
5 “These [stay] factors interrelate on a sliding scale and must be balanced
against each other. If the arguments for one factor are particularly strong, an in-unction may issue even if the arguments in other areas are rather weak.” Serono Labs., Inc. v. Shalala, 158 F.3d 1313, 1318 (D.C. Cir. 1998) (citation to CityFed omitted).
6
Petitioners) are not mitigated by the fact that the FCC may make new channel
assignments available to some, but not all, displaced LPTV licensees after
conclusion of the tripartite auction framework. Stay Denial Order at 4 ¶ 8.
Notably, the FCC’s response offers no reassurance that the individual Joint
Petitioners will not lose their channel assignments (FCC Br. at 15) or that once the
auction begins, the Court will be able to provide any meaningful remedy for the
“displaced LPTV stations [that] will…be required to cease operations.” Stay
Denial Order at 4 ¶ 8. Under those circumstances, which the FCC conspicuously
does not deny (FCC Opp. Br. at 12), our injuries are almost 100% certain and
plainly irreparable, because, by definition, they cannot be repaired later.
One would rationally expect that if a judicial remedy were as simple as the
FCC suggests, the agency would reveal up front what relief this Court could decree
later in the auction “process.” It has not. See FCC Opp. Br. at 15-16 & n.4 (point-
ing only to administrative relief, not any judicial remedy, available post-auction).
That the agency does not offer an inkling of what that might be is revealing,6 and
dispositive of the FCC staff’s claim that plenty of time remains for this Court to act
“down the road.”
6 As the parties to parallel stay motions (raising different substantive issues)
have observed without contradiction, “it appears no court has ever vacated the results of an FCC auction after it has taken place.” Emergency Motion for Stay at 18, The Videohouse, Inc. v. FCC, No. 16-1060 (D.C. Cir. filed Feb. 29, 2016).
7
B. The Public Interest & Third-Party Harms
While denigrating Petitioners’ injuries, the FCC simultaneously contends
that even the briefest of delays in implementing its spectrum auction Orders would
certainly injure other broadcasters planning to participate in the reverse and
forward auctions. FCC Br. at 16-18. That assertion is unsubstantiated; it also mis-
characterizes the effect of including LPTV in the spectrum reorganization.
First, the FCC’s claim that the auction must start in a few weeks (id. at 17) is
belied by its own actions delaying the auction for more than two years, from early
2014 until nearly mid-2016. E.g., Expanding the Economic and Innovation Oppor-
tunities of Spectrum Through Incentive Auctions, GN Docket No. 12-268, Notice
of Proposed Rulemaking, 27 FCC Rcd. 12357 ¶ 10 (rel. Oct. 2, 2012) (FCC “will
be able to conduct the auction in 2014”); Tom Wheeler, “The Path to a Successful
Incentive Auction,” FCC Blog (Dec. 6, 2013 10:45 a.m.) (delay of auction until
“middle of 2015”), available at http://ht.ly/Zx4Sx; Gary Epstein, Chair, FCC
Incentive Auction Task Force, “Incentive Auction Progress Report,” FCC Blog
(Oct. 24, 2014 12:00 p.m.) (further delay of auction to “early 2016”), available at
http://ht.ly/Zx5Fq. On the other hand, the agency’s parenthetical suggestion that
Petitioners’ motion is “extraordinarily belated” (FCC Opp. Br. at 1) undermines its
previous opposition to expedited consideration of these and related cases, where
8
the agency represented that a stay motion was the appropriate vehicle for addres-
sing the timing of this Court’s decision.7
Second, Congress itself has made clear that this auction is not urgent. The
Spectrum Act exempted the incentive auction from the Communications Act’s
general policy of conducting auctions “without administrative or judicial delays,”
47 U.S.C. § 309(j)(3)(A), and instead set the very different deadline of a full
decade, until fiscal year 2022, for the FCC to complete the auction. Id.
§ 1452(f)(4). See Stay Mot. at 3, 17; cf. Omnipoint Corp. v. FCC, 78 F. 3d 620,
629 (D.C. Cir. 1996) (citing § 309(j)(3)(A)); id. at 630 (for C-Block auction, “the
Commission was under a congressional deadline to act quickly”).8
Third, all the FCC offers with respect to its allegations of public interest and
third-party harms is that delay would “upend the settled plans of broadcasters,
wireless carriers and other companies that have made significant investments,
secured financing and laid aside other business plans based on the current
schedule.” FCC Opp. Br. at 15; accord, Stay Denial Order ¶ 9. The FCC’s
7 The FCC objected to the proposed “breakneck” briefing schedule and
suggested challengers should instead seek a “stay pending judicial review.” FCC Response to Motion to Expedite at 1, 3, The Videohouse, Inc. v. FCC, No. 16-1060 (D.C. Cir. filed Feb. 19, 2015). The present motion was filed 10 days after Videohouse moved for a stay in No. 16-1060.
8 The agency’s auction decision contains just a few pages and paragraphs addressing “Auction Completion and Effective Date of the Repacking Process,” First Report and Order at ¶¶ 527-32, which do not establish a pre-2022 deadline for auction completion or even discuss the issue of completion, or start, dates.
9
assertions of third-party harms merely parrot immaterial amici and intervenor
objections in other pending stay proceedings before this Court. “None of these
injuries is irreparable and none prevents any broadcaster from participating in the
reverse auction, whether commenced on March 29 or a few months later.” Stay
Mot. at 18. Moreover, because reverse auction bids are not owed compensation
until, years from now, after the forward auction concludes—and only if it gener-
ates adequate funds, 47 U.S.C. §§ 1452(c)(2), (f)(2), (f)(5)—these arguments do
not change the Court’s appropriate balancing of the four judicial stay criteria. Id.9
The Court should not place vague, far-distant third-party interests over the con-
crete, irreparable and imminent harms faced by LPTV stations generally and Joint
Petitioners specifically.10
9 While FCC’s brief contends that extension of the pre-auction “quiet
period” will disrupt participating broadcasters, FCC Opp. Br. at 17 (citing Stay Denial Order ¶ 10 and 47 C.F.R. §§ 1.2105(c)(1), 1.2205(b)), that is a purely reg-ulatory obstacle the Commission itself is fully authorized to and capable of waiving.
10 The FCC’s opposition does not defend the staff’s contention that Joint Petitioners are incorrect that the “one and only” step required to remedy the harm to LPTV is a “simple, indeed trivial” software data input. Stay Mot. at 18 & n.21. According to the Media Bureau’s Stay Denial Order, this reflects a “fundamental misunderstanding of the complexity of the auction process” and would necessitate “a rulemaking proceeding to determine how to protect LPTV stations in the re-packing.” Stay Denial Order at 4-5 ¶ 11. The agency staff was wrong, and FCC counsel were correct to disregard that claim. Therefore, it is conceded that includ-ing LPTV in the spectrum reorganization is just as easy as Petitioners told this Court, without rebuttal, in their motion.
10
The Commission’s lawyers repeat the agency staff’s assertion that Joint
Petitioners demand “protection” in the spectrum reorganization. FCC Opp. Br. at 5,
10, 11; Stay Denial Order at 5-6 ¶ 11. This is false. We ask only to be “included”
in the reorganization “repack,” such that spectrum clearances, interference and
channel reassignments flowing therefrom will not be made without technical
analysis of the real-world impact on LPTV broadcasters.11 This would, as is now
clear, not lead to an auction delay “measured in years, not months,” Stay Denial
Order at 6, which the FCC has glaringly declined to argue to this Court.
CONCLUSION
Parties challenging the FCC’s spectrum auction must be “allow[ed]…an
opportunity for meaningful relief before the incentive auction commences on
March 29, 2016.” Order Denying Mandamus Relief, In re Videohouse, Inc., No.
15-1486 (D.C. Cir. Dec. 30, 2015). Judicial review will be less than meaningful if
the FCC is permitted to start the spectrum auction while these cases are sub judice.
A stay pending appeal would maintain the status quo, giving this Court the
opportunity to fully assess the substantial legal issues raised by the Orders.
[Signature and counsel listings on next page]
11 See First Report & Order ¶¶ 113-14 (auction reorganization phase will
use the agency’s revised TVStudy software to generate “constraint files” for broad-casters to assess whether a “channel…is available for every station that remains on the air following the incentive auction”).
11
Respectfully submitted,
/s/ R. Scott Caulkins /s/ Glenn B. Manishin R. Scott Caulkins Glenn B. Manishin
R. SCOTT CAULKINS CAULKINS & BRUCE PC 2300 Wilson Blvd., Suite 240 Arlington, VA 22201 703-558-3664 [email protected] AARON P. SHAINIS LEE J. PELTZMAN SHAINIS & PELTZMAN, CHARTERED 1850 M Street, N.W., Suite 240 Washington, DC 20036 202-293-0011 [email protected]
Counsel for Petitioner Mako Communications, LLC Dated: March 16, 2016
GLENN B. MANISHIN PARADIGMSHIFT LAW LLP 6735 BREEZY DRIVE, SUITE 101 WARRENTON, VA 20187 202-256-4600 [email protected] C. BOYDEN GRAY ADAM J. WHITE BOYDEN GRAY & ASSOCIATES PLLC 801 17th Street, N.W., Suite 350 Washington, DC 20006` 202-955-0620 [email protected] Counsel for Petitioner Free Access & Broadcast Telemedia LLC ROBERT OLENDER KOERNER & OLENDER PC 7020 Richard Drive Bethesda, MD 20817 301-468-3336 [email protected] Counsel for Petitioner Word of God Fellowship, Inc.
CERTIFICATE OF SERVICE
I hereby certify that all counsel of record who have consented to electronic
service are being served today with a copy of this document via the Court’s
CM/ECF. All parties in this case are represented by counsel consenting to
electronic service.
/s/ Glenn Manishin Glenn B. Manishin
March 16, 2016