Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-97-01001/USCOURTS-caDC-97-01001-0/pdf.json

Parties Involved:
City of Lewisville, Texas
Intervenor
Federal Communications Commission
Appellee
Keller Communications, Inc.
Appellant

Document Text:

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United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued October 27, 1997 Decided December 12, 1997 

No. 97-1001

KELLER COMMUNICATIONS, INC.,

APPELLANT

v.

FEDERAL COMMUNICATIONS COMMISSION,

APPELLEE

CITY OF LEWISVILLE, TEXAS,

INTERVENOR

Appeal of Orders of the 

Federal Communications Commission

Dan Warnock argued the cause for appellant. With him on 

the briefs was Christopher D. Imlay.

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K. Michele Walters, Counsel, Federal Communications 

Commission, argued the cause for appellee. With her on the 

briefs were William E. Kennard, General Counsel, Daniel M. 

Armstrong, Associate General Counsel, and Roberta L. Cook,

Counsel.

L. Andrew Tollin and Jeffrey S. Cohen were on the brief 

for intervenor City of Lewisville, Texas. Lawrence J. Movshin entered an appearance.

Before: GINSBURG, SENTELLE and TATEL, Circuit Judges.

TATEL, Circuit Judge: The Federal Communications Commission waived several regulatory requirements to permit a 

Texas city to add a nearby town's frequency to its own public 

safety radio system. Because the Commission's determination that the waiver was necessary to protect public safety 

finds support in the record and is neither arbitrary nor 

capricious, we affirm the Commission.

I

Like many municipalities, Lewisville, Texas, uses a 

"trunked radio system" for fire, police, and emergency medical communications. Unlike conventional radio systems, 

which have a specific frequency channel assigned to mobile 

and base stations, trunked systems have multiple channels for 

use as a "trunk group." See 47 C.F.R. § 90.7 (1996). Because computers assign calls to the next available channel on 

trunked systems, more than one party can communicate at a 

time. Under Commission rules, conventional channel licensees must share their channels, but trunked system licensees 

enjoy exclusive use of their channels. See id. §§ 90.631(b), 

90.633(b).

By late 1992, Lewisville had grown concerned that its 

public safety radio system was overloaded. At the same time, 

its neighboring town, Flower Mound, worried that its conventional safety communications system had become inadequate. 

To solve both their problems, the two towns agreed that 

Lewisville would add Flower Mound's conventional channel to 

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ty, take over communications services for Flower Mound. 

Because trunked systems have exclusive use of added channels, Commission rules in effect at the time required Lewisville to get consent from anyone who might be sharing Flower 

Mound's conventional channel. 47 C.F.R. § 90.615(b)(2)(ii) 

(1992). To accomplish this, the rules required Lewisville to 

submit its application to a "frequency coordinator" who, after 

checking the Commission's database, would either certify that 

no one else had a license to use Flower Mound's channel or 

would inform Lewisville that someone did. See id. 

§ 90.615(b)(2)(iv). If another license is discovered, even a 

canceled or expired one, the Commission's "database deletion 

policy" prohibits the coordinator from forwarding the application to the Commission. See Amendments of Parts 1 and 90 

of the Commission's Rules Concerning the Construction, 

Licensing, and Operation of Private Land Mobile Radio 

Stations, Report and Order, 6 F.C.C.R. 7297, 7301-02 (1991).

In accordance with these requirements, Lewisville sent its 

application to the public safety frequency coordinator. On 

February 2, 1993, the day Flower Mound's license expired, 

the coordinator certified that no co-licensee shared Flower 

Mound's frequency and sent the application to the Commission. The coordinator, however, failed to detect that one 

Robert Greene also owned a license for Flower Mound's 

conventional frequency. Although Greene's license had expired some three months earlier because he had failed to 

construct a station within the eight months required by 

Commission regulations, 47 C.F.R. § 90.633(d) (1996), the 

license remained in the Commission's database.

Discovering what the frequency coordinator missed, appellant Keller Communications, Inc., an operator of several 

frequencies in the area, filed a "finder's preference request" 

for Greene's license. One who alerts the Commission to the 

existence of a license that has expired due to the license 

holder's failure to construct a station in time may receive an 

exclusive license for the discovered channel. See id.

§ 90.173(k). But because finder's preference requests could 

not be filed until 180 days after the construction deadline, 

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Keller's filing was fatally premature. See 47 C.F.R. 

§ 90.173(k)(2) (1992); Amendments of Parts 1 and 90, 6 

F.C.C.R. at 7307 ("[W]e establish a 180-day window ... 

during which we will not accept any finder's requests filed 

against [the target] licensee."). Although Greene later submitted a petition to cancel his license, the Commission took no 

action; according to the agency, it does not delete canceled 

licenses while finder's preference requests are pending.

By now then, the Commission faced a bit of a messa 

defective application (Lewisville's); a defective finder's preference request (Keller's); and an expired license in its database (Greene's). Confusing matters further, the Commission 

mistakenly granted Lewisville the license. Later discovering 

its error, the Commission revoked the license, explaining in a 

June 8 letter to Lewisville that its application had been 

returned to "pending" status and that Flower Mound's license 

had been reinstated. The letter also informed Lewisville that 

it could resubmit its application either if it obtained Keller's 

consent or if the Commission denied Keller's finder's preference request.

Apparently having had enough of the Commission's formal 

procedures, Lewisville sent a letter to U.S. Senator Phil 

Gramm, warning that if the Commission failed to grant its 

application, "[t]he operation of the police and fire departments serving the population of these communities will be 

adversely affected." Lewisville sent a copy of the letter to 

the Commission but not to Keller. One month later, the 

Commission dismissed Keller's premature finder's preference 

request, informing Lewisville by phone on the same day that 

it could resubmit its application. Bypassing the frequency 

coordinator, Lewisville promptly resubmitted its application.

Now it was Keller's turn to act. It filed another finder's 

preference request as well as a conventional application for 

Flower Mound's channel, but to no avail. The Commission 

denied both, rejecting the conventional application because 

Lewisville had already applied for the frequency and the 

finder's request because Greene had canceled his license.

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On September 3, in an action central to this case, the 

Commission granted Lewisville's license even though 

Greene's canceled license remained in the database. Relying 

on its waiver regulations, which provide that agency rules 

"may be ... waived for good cause shown, in whole or in 

part, at any time by the Commission," 47 C.F.R. § 1.3 (1996), 

the Commission explicitly waived the database deletion requirement as well as all other defects in Lewisville's application:

Because Greene's station is no longer operating, we are 

waiving the requirement that the City of Lewisville 

obtain Greene's consent to convert this channel to 

trunked use and, alternatively, we are waiving the requirement that Greene's license be deleted from the 

database prior to coordination of the City of Lewisville 

for use of this frequency at their location.... We find 

good cause to be present warranting this action. Absent 

this waiver, the City of Lewisville will be unable to 

accomodate [sic] the Town of Flowermound [sic] and 

Flowermound [sic] public safety entities (including police, 

fire, and ambulance services) will be left without critical 

radio communications. Further, the City of Lewisville's 

police, fire, ambulance and public service departments 

will be hampered by an overloaded public safety communication system. In light of these factors which weigh 

heavily in favor of granting the above referenced application and given our statutory mandate to consider the 

public interest, we are waiving any defects in Lewisville's 

application.

In a Petition for Reconsideration to the Private Radio 

Bureau, Keller argued that the Commission improperly exercised its waiver authority and committed a variety of other 

procedural errors. After the Bureau denied the petition, 

Keller appealed to the full Commission, reiterating its arguments and adding that Lewisville had violated the agency's ex 

parte rules by sending the Gramm letter to the Commission 

but not to Keller. Finding no ex parte violation and concluding that "the waiver was necessary to protect the public 

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safety and security of two populous communities in the 

Dallas/Fort Worth area," the Commission denied Keller's 

application for review. City of Lewisville, Texas Application 

for Modification of Trunked Public Safety/Special Emergency Radio Station License Station KNGK 472, Memorandum 

Opinion and Order, 11 F.C.C.R. 19638, 19642 (1996). Keller 

now appeals, arguing that the Commission's actions were 

arbitrary, capricious, and an abuse of discretion. See 5 

U.S.C. § 706(2)(A) (1994).

II

In addition to its complaint about the waiver, Keller challenges virtually every other Commission action in this case. 

Granting Lewisville's application, it argues, was improper not 

just because Greene's license remained in the database, but 

also because the applicationwhether labeled as an application for assignment, modification, or new stationwas technically defective under Commission rules. Keller also argues 

that the Commission erred by placing Lewisville's application 

in pending status rather than dismissing it, by reinstating 

Flower Mound's license on its own motion, and by allowing 

Lewisville to resubmit its application directly to the Commission rather than to the frequency coordinator. As Keller 

conceded at oral argument, however, we need not consider 

any of these issues if the Commission acted within its authority by waiving the defects in Lewisville's application, including 

the database deletion requirement. If proper, the waiver 

eliminated Greene's license as a bar to Lewisville's application, removed any technical defects in the application, and 

made irrelevant all errors Keller alleges the Commission 

committed after February 2, the date the frequency coordinator sent Lewisville's flawed application to the Commission. 

See Letter from W. Riley Hollingsworth, Federal Communications Commission, to Raymond A. Kowalski, Counsel for 

Appellants (Aug. 9, 1994) (explaining that the result of the 

waiver was "to place the parties in the position they would 

have been in had the coordinator not erred").

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The Commission's rules allow it "at any time" to waive 

requirements for good cause. See 47 C.F.R. § 1.3 (1996). As 

we have held, "an agency's discretion to proceed in difficult 

areas through general rules is intimately linked to the existence of a safety valve procedure for consideration of an 

application for exemption based on special circumstances." 

WAIT Radio v. FCC, 418 F.2d 1153, 1157 (D.C. Cir. 1969). 

The Commission may waive its rules if "particular facts would 

make strict compliance inconsistent with the public interest." 

Northeast Cellular Tel. Co. v. FCC, 897 F.2d 1164, 1166 (D.C. 

Cir. 1990); see also Omnipoint Corp. v. FCC, 78 F.3d 620, 631 

(D.C. Cir. 1996) (Commission properly waived comment requirement because the waiver was "necessary in order to 

reduce the harm resulting from delay"). In exercising its 

waiver authority, however, the Commission may not "act out 

of unbridled discretion or whim ... any more than in any 

other aspect of its regulatory function," WAIT Radio, 418 

F.2d at 1159, and it must clearly state in the record its 

reasons for granting the waiver. See Basic Media Ltd. v. 

FCC, 559 F.2d 830, 833 (D.C. Cir. 1977); see also Northeast 

Cellular, 897 F.2d at 1166 ("The agency must explain why 

deviation better serves the public interest and articulate the 

nature of the special circumstances to prevent discriminatory 

application and to put future parties on notice as to its 

operation.").

Particularly important to this case, Congress directed the 

Commission to consider public safety needs when exercising 

its discretion, encouraging it to "make available ... radio 

communication service[s] ... for the purpose of promoting 

safety of life and property," 47 U.S.C. § 151 (1994), and 

requiring it to "promote the safety of life and property" when 

managing the private land mobile services spectrum, id.

§ 332(a)(1). The Conference Report accompanying this latter 

provision urged the Commission "to be ever vigilant to promote the private land mobile spectrum needs of police departments and other public agencies which need to use such radio 

services to fulfill adequately their obligations to protect the 

American public." H.R. CONF. REP. NO. 97-765, at 52-53 

(1982), reprinted in 1982 U.S.C.A.A.N. 2261, 2296. The 

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Commission often exercises its waiver authority to fulfill this 

mandate. See, e.g., Waiver of Parts 2 and 90 of the Commission's Rules to Permit New York Metropolitan Area Public 

Safety Agencies to Use Frequencies at 482-488 MHZ on a 

Conditional Basis, Order, 10 F.C.C.R. 4466, 4468 (1995) 

(waiving requirements because "public safety agencies in the 

New York City metropolitan area have an urgent and immediate need for additional spectrum capacity for public safety 

communications"); Waiver of Sections 90.621(d), 90.623(a), 

90.629, 90.633, and 90.651(c) of the Commission's Rules to 

License Use of Six Conventional 900 MHZ Frequency Pairs 

for an Advanced Train Control System, Order, 3 F.C.C.R. 

427, 428 (1988) (citing 47 U.S.C. §§ 151, 332(a)(1) in support 

of waiver granted to facilitate development of an Advanced 

Train Control System which would "improve railroad safety 

... dramatically").

Applying these principles, we think the waiver here was 

well within the Commission's authority. The Commission had 

ample reason to believe that the waiver was necessary to 

protect public safety in both Lewisville and Flower Mound. 

Lewisville told the Commission that without the license, it 

would "have no option but to terminate its agreement with 

the Town of Flower Mound," leaving the growing town "without emergency communications for [its] police and fire protection and emergency medical services," burdening Lewisville 

"with an overloaded public safety communications system," 

and creating "emergency situations in which police, fire and 

medical units would receive busy signals when they attempt 

to transmit critical information." In addition to relying on 

these public safety concerns, the Commission found, reasonably we believe, that the waiver was justified by the coordinator's failure to discover Greene's license and by Lewisville's 

expenditure of thousands of dollars of public funds in reliance 

on the agency's mistaken grant of its license. Memorandum 

Opinion and Order, 11 F.C.C.R. at 19641.

Challenging Lewisville's public safety claims, Keller points 

out that Flower Mound possessed other licenses. According 

to Lewisville, those other channels, part of an old system with 

limited geographical coverage, were inadequate for primary 

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emergency use. Apparently agreeing with Lewisville, the 

Commission concluded that the two towns needed to use 

Flower Mound's conventional channel in conjunction with 

Lewisville's trunked system to protect public safety in the 

region. Whether particular channels provide adequate public 

safety communications is precisely the type of technical issue 

on which we defer to the Commission's expertise. See MCI 

Cellular Tel. Co. v. FCC, 738 F.2d 1322, 1333 (D.C. Cir. 1984) 

(when the Commission addresses a "highly technical question," the court "must show considerable deference to [its] 

expertise"). Apart from offering to provide the necessary 

communication services itself, presumably at an appropriate 

price, Keller introduced no evidence to counter Lewisville's 

claim that it needed Flower Mound's license to protect public 

safety. Keller argues that in denying the Petition for Rehearing, the Commission relied on evidence not submitted 

until after it granted the original waiver, but the case on 

which it reliesNational Ass'n of Broadcasters v. FCC, 740 

F.2d 1190, 1204 (D.C. Cir. 1984)holds only that agencies 

cannot present arguments in court not relied upon during the 

administrative process; nothing in that decision bars agencies 

from relying on evidence submitted at different stages of the 

administrative process.

Keller's only remaining claim is that Lewisville violated the 

Commission's ex parte rules by forwarding a copy of the 

Gramm letter to the Commission but not to Keller. Those 

rules prohibit ex parte communications between parties and 

the Commission in "restricted proceedings." 47 C.F.R. 

§ 1.1208 (1996). The parties disagree about whether the 

coexistence of the Keller and Lewisville applications created a 

"restricted proceeding." We need not resolve that issue, 

however, because although Lewisville's letter may have inspired the Commission to dismiss Keller's finder's preference 

request, the Commission could not possibly have awarded 

Keller the licenseKeller's preference request was fatally 

premature. Whether the proceedings were restricted or 

unrestricted, Lewisville's ex parte communication with the 

Commission was therefore harmless. See Freeman EngiUSCA Case #97-1001 Document #315543 Filed: 12/12/1997 Page 9 of 10
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neering Assocs., Inc. v. FCC, 103 F.3d 169, 184 (D.C. Cir. 

1997).

Under all of these circumstances, we find no basis for 

questioning the Commission's waiver. Because the waiver 

returned the parties to the positions they occupied on February 2, except that Greene's license in the database no longer 

barred awarding Lewisville the license, we need not address 

Keller's challenges to the Commission's other post-February 

2 actions. Because the waiver also removed any technical 

defects that might have existed in Lewisville's application, the 

Commission's order is affirmed.

So ordered.

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