Conference Request Supreme Court To Review Cable Modem Decision
Cities Stand To Lose $470 Million Dollars Per Year In Cable Modem Franchise Fee Revenue
By Ron Thaniel
October 18, 2004
Joined by four national organizations October 4, the U.S. Conference of Mayors asked the Supreme Court to review the decision of the United States Court of Appeals for the Ninth Circuit, and to also review the underlying decision of the Federal Communications Commission (FCC), concerning the regulatory classification of cable modem service.
The U.S. Conference of Mayors, National League of Cities, the National Association of Counties, the International Municipal Lawyers Association, and the National Association of Telecommunications Officers and Advisors, formed the Alliance of Local Organizations Against Preemption to pursue legal and regulatory actions as a result of the FCC's ruling that cable modem service is not a cable service. Click here to view the press release.
The Alliance has filed comments before the FCC throughout its proceedings on the appropriate classification of cable modem service, and pursued challenges to the agency's determination through the courts. The FCC ruled that cable modem service offered over a cable system is an interstate information service, not a telecommunications service or a cable service, and thus no longer subject to local cable franchise requirements.
In October 2003, the Ninth Circuit ruled that cable modem service is not a cable service but has separate telecommunications service and information service components, affirming in part, vacating in part, and remanding the case to the FCC. The Alliance filed petitions for rehearing, and in March 2004, the Ninth Circuit denied those requests.
The Alliance is specifically concerned that the Supreme Court provide a full review of both the Ninth Circuit and FCC decisions because absent such review, the classification of cable modem service would be determined without any meaningful judicial review of the underlying arguments of classifying cable modem service. While the high court generally will not address questions that have not been addressed by the court below, it has done so in the past, and the Alliance argues this is one of those rare instances where it should do so again.
The Alliance's filing, a Conditional Cross Petition for Certiorari, seeks the high court's review for the following reasons:
It was a quirk of judicial process that placed the underlying case in the hands of the Ninth Circuit, which had previously ruled in the AT&T v. Portland case.
The Ninth Circuit never adequately addressed the merits of the arguments pertaining to the classification of cable modem service because in the Portland case the issue was not briefed and in the appeal of the FCC's decision the court decided it was bound by its earlier decision in the Portland case.
The FCC's decision that cable modem service is not a cable service does not pass the Chevron analysis that the Supreme Court has held applies to review for agency decisions.
The underlying decision of the Ninth Circuit, which affirmed the FCC on the cable service issue, does not comport with the requirements of the Supreme Court's Chenery case for affirming an agency's decision.
The Alliance has continued, throughout the course of the court proceedings, to express its concerns regarding the underlying FCC decision. Some of the concerns expressed by the Alliance are:
Local governments stand to lose as much as $470 million dollars per year in cable modem franchise fee revenue, which should have been paid as a result of the cable operator's use of the public's property.
These are funds that could be used by local governments to make their communities safer and more livable, from homeland security and general police and fire protection, to high quality education services to allow citizens to make full use of the rapid changes in technology.
The Ninth Circuit and FCC rulings attempt to deprive local government of their right to require cable operators to pay adequately for their use of public property for private gain.
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