Supreme Court Upholds FCC Move To Relax Media Ownership Rules

(AP Photo/Patrick Semansky)

The Supreme Court ruled on Thursday that the FCC was within its legal authority to relax a series of media ownership rules in 2017, when Republicans still held the majority on the commission.

In a unanimous opinion written by Justice Brett Kavanaugh (read it here), the justices held that the FCC “made a reasonable predictive judgment based on the evidence it had” in changing the rules.

Back then, the commission, in a party-line vote, lifted a ban on owning a broadcast station and newspaper in the same market. It also eliminated a rule that prohibited the ownership of more than two TV stations and a radio station in the same market. The FCC also eliminated a requirement that, as a condition of a merger of two outlets, at least eight independently owned TV stations remain in that same market. The commission eased a prohibition on the ownership of two of the top four rated stations in a market, allowing for such combinations on a case-by-case basis.

The Prometheus Radio Project and other public interest groups challenged the changes, arguing that the FCC had failed to adequately consider the impact that the moves would have on minority and female ownership of media outlets. They argued that the commission relied on flawed data.

Kavanuagh, however, wrote that “the FCC acknowledged the gaps in the data sets it relied on, and noted that, despite its repeated requests for additional data, it had received no countervailing evidence suggesting that changing the three ownership rules was likely to harm minority and female ownership.

“Prometheus also asserts that the FCC ignored two studies submitted by a commenter that purported to show that past relaxations of the ownership rules had led to decreases in minority and female ownership levels. But the record demonstrates that the FCC considered those studies and simply interpreted them differently,” he wrote.

He wrote that the Administrative Procedure Act, which spells out how agencies can set regulations, “imposes no general obligation on agencies to conduct or commission their own empirical or statistical studies.”

“In light of the sparse record on minority and female ownership and the FCC’s findings with respect to competition, localism, and viewpoint diversity, the Court cannot say that the agency’s decision to repeal or modify the ownership rules fell outside the zone of reasonableness for purposes of the APA,” he wrote.

What is unclear is whether the FCC will now move to restore some of the rules, with Democrats poised to take the majority once a vacancy on the commission is filled.

“While I am disappointed by the Court’s decision, the values that have long upheld our media policies—competition, localism, and diversity—remain strong,” said Acting FCC chairwoman Jessica Rosenworcel. “I am committed to ensuring that these principles guide this agency as we move forward.”

Andrew Jay Schwartzman, who represented the public interest groups and is senior counselor at the Benton Institute for Broadband and Society, said in a statement, “We lost, and that is unfortunate. However, the Court rejected the NAB’s efforts to obtain a ruling that would have essentially removed the FCC’s power to impose limits on broadcast ownership. This will enable our clients to enforce and improve ownership limits in the future.”

He added, “Underlying this case is the FCC’s failure — over decades — to collect meaningful data about who really owns the nation’s broadcasting stations. We will now need to work with the Biden administration FCC to get that information.”

The Supreme Court ruling overturns that of the Third Circuit, which last year found that the FCC did not adequately consider the effect that the revised rules would have on ownership of TV outlets by women and minorities.

Gordon Smith, the president and CEO of the National Association of Broadcasters, praised the decision. “It is critical that the commission continue to examine its media ownership rules to ensure that America’s broadcasters are able to compete and meet the needs of local communities across the nation in today’s media landscape,” he said in a statement.

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