1The Honorable Patrick A. Conmy, United States District Judge for the District

of North Dakota.

United States Court of Appeals

FOR THE EIGHTH CIRCUIT

___________

No. 98-3539

___________

United States of America, *

*

Appellee, *

* Appeal from the United States

v. * District Court for the

* District of North Dakota

Roy Neset, *

*

Appellant. *

___________

Submitted: May 12, 1999

Filed: November 28, 2000

___________

Before McMILLIAN, HEANEY and FAGG, Circuit Judges.

___________

McMILLIAN, Circuit Judge.

Roy Neset appeals from a final order entered in the District Court1 for the

District of North Dakota granting declaratory and injunctive relief in favor of the

United States (the government), acting on behalf of the Federal Communications

Commission (FCC). United States v. Neset, 10 F. Supp. 2d 1113 (D.N.D. 1998). For

reversal, Neset argues that the district court erred in (1) finding that he lacked standing

to raise his First Amendment defenses, (2) requiring him to exhaust administrative
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remedies before he could raise his First Amendment defenses, and (3) applying the

doctrine of primary jurisdiction to preclude him from raising his statutory defenses. For

the reasons discussed below, we affirm the judgment of the district court.

The government asserted that the district court had subject matter jurisdiction

under 28 U.S.C. §§ 1331, 1345, and 47 U.S.C. § 401(a) (civil applications to enjoin

violations of Communications Act of 1934). This court has appellate jurisdiction under

28 U.S.C. § 1291. Neset filed a timely notice of appeal under Fed. R. App. P.

4(a)(1)(B).

The facts in the present case are not disputed. Neset is a farmer in Tioga, North

Dakota, a small town in the upper northwest corner of the state. Tioga's only radio

station, KTGO, broadcasts country music. Neset likes to listen to talk radio and

received permission from a Colorado radio station to broadcast that station's talk and

news programming. Neset used a one-watt transmitter with a 30-watt amplifier to

broadcast primarily over his own property, that is, from his house to his tractor while

working in his fields. The signal could be heard at a range of about 5 miles from

Neset’s property. About 8-10 other individuals also listened to his broadcasts. The

signal did not interfere with any other broadcasts or stations or threaten public safety.

Except for certain special broadcasts and extremely low-power broadcasts, it is

unlawful to transmit radio signals within the United States without a license or waiver

from the FCC. See 47 U.S.C. § 301. In September 1997 the station manager of

KTGO complained to the FCC that Neset was operating an unlicensed radio station in

the Tioga area on a frequency of approximately 88.1 mhz. FCC engineer Frank Evans

investigated the complaint and sent Neset a letter advising him of the Communications

Act’s radio broadcast licensing requirements and the penalties for unlicensed operation.

Neset replied by letter. He admitted making unlicensed radio broadcasts, but asserted

that his First Amendment rights were at stake and that he could not obtain a license

because the FCC no longer issued licenses for low-power radio broadcasts.
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 In October 1997, Evans traveled to Tioga and measured the field intensity of

Neset’s radio broadcasting signal. The signal significantly exceeded the maximum

intensity allowable under FCC regulations for unlicensed broadcasting. See 47 C.F.R.

§ 15.239(b) (88-108 mhz FM transmissions not exceeding 250 micro-volts per meter

at distance of 3 meters). In late November 1997 Neset stopped broadcasting for about

10 days, but then resumed broadcasting on a different frequency (88.3 mhz). In March

1998 Evans returned to Tioga to measure the field intensity of the radio transmissions

coming from Neset’s property. He again found that the signal significantly exceeded

the maximum intensity allowable under the regulations.

In March 1998, the government brought this action against Neset in federal

district court for declaratory and injunctive relief. The government sought to enjoin

Neset from making radio transmissions without a license or a waiver in violation of 47

U.S.C. § 301. See 47 U.S.C. § 401(a) (civil action to enjoin noncompliance). In his

answer, Neset admitted making the radio transmissions and that he had not applied to

the FCC for a radio broadcast license or a waiver. However, he asserted several

affirmative defenses raising constitutional and other challenges to the FCC

microbroadcasting regulations. The district court consolidated the preliminary and

permanent injunction proceedings.

First, Neset argued that the FCC microbroadcasting regulations are invalid

because the FCC failed to comply with the Paperwork Reduction Act or the

Administrative Procedures Act. The district court found that it did not have subject

matter jurisdiction over these statutory violation defenses because the doctrine of

primary jurisdiction required that Neset first challenge an FCC policy or practice before

the FCC and then seek judicial review exclusively in the courts of appeals. See Neset,

10 F. Supp. 2d at 1114-15.

Neset also argued that the FCC microbroadcasting regulations are

unconstitutional and violated his free speech rights and those of others who listen to his
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broadcasts. Neset relied upon a recent decision from the Northern District of California

in which a microbroadcaster raised similar affirmative defenses challenging the

constitutionality of the microbroadcasting regulations. See United States v. Dunifer,

997 F. Supp. 1235 (N.D. Cal. 1998), aff’d on other grounds, 219 F.3d 1004, 1007-09

(9th Cir. 2000) (holding district court lacked subject matter jurisdiction under

applicable statutory framework to decide microbroadcaster’s constitutional challenges

to licensing regulations). Neset argued that the regulations were overbroad, were not

narrowly tailored to further the government’s interests in preserving the available

broadcast spectrum or preventing signal interference, and interfered with the First

Amendment rights of his listeners to receive valuable information. The district court

adopted the Ninth Circuit’s view that a defendant must establish standing to assert an

affirmative defense. See 10 F. Supp. 2d at 1116 (“In raising an affirmative defense,

a defendant is seeking the jurisdiction of the court to hear its claims as much as a

plaintiff and, therefore, standing becomes an issue for the defendant as well.”) (citing

Ninth Circuit cases). But see Wynn v. Carey, 599 F.2d 193, 196 (7th Cir. 1979)

(holding standing applies only to plaintiffs). The district court also found persuasive

the Dunifer court’s constitutional analysis and decided that, like Dunifer, Neset lacked

standing to raise his constitutional defenses because he had not applied for a radio

broadcast license or a waiver and thus the regulations have never been applied to him.

See 10 F. Supp. 2d at 1115-16 (thus failing to show causal connection between injury

and conduct of which complained); Dunifer, 997 F. Supp. at 1240, 1242, 1243-44.

The district court then found that Neset violated the license requirement of 47

U.S.C. § 301. See 10 F. Supp. 2d at 1116. Neset admitted that he was responsible for

unlicensed radio transmissions on 88.1 mhz in October 1997 and on 88.3 mhz in March

1998. The record showed that he continued to broadcast after being notified of the

violation. The district court rejected his asserted defenses. The district court enjoined

Neset and all persons in active concert or participation with him from making radio

transmissions within the United States without first obtaining a license or other

appropriate authorization (such as a waiver) from the FCC. See id. at 1116-17 (noting
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that violation of law supports finding of irreparable injury and no adequate remedy at

law exists). The district court subsequently denied Neset’s motion to alter or amend

the judgment. This appeal followed.

During the pendency of this appeal, the FCC essentially reversed its position on

microbroadcasting and adopted rules authorizing the licensing of two new classes of

non-commercial FM radio stations, one operating at a maximum power of 100 watts

and one at a maximum power of 10 watts. See In re Creation of Low Power Radio

Service, FCC 00-19, MM Docket No. 99-25, 65 Fed. Reg. 7616, 2000 WL 85304, at

¶1 (released Jan. 27, 2000) (to be codified at 47 C.F.R. pts. 11, 73, 74). Under the new

regulations the FCC will issue licenses to microbroadcasters to operate low-power FM

stations. However, it is not clear whether former unlicensed microbroadcasters like

Neset will be eligible for a low-power broadcasting license under the new regulations.

See id. at ¶¶ 51-55 (rejecting amnesty for unlicensed broadcasters and announcing

acceptance of applicants who, if at some time in the past they broadcast illegally,

certify that they voluntarily ceased broadcasting illegally no later than Feb. 26, 1999,

without specific directions to terminate by the FCC, or they ceased broadcasting

illegally within 24 hours of being advised by the FCC to do so). See United States v.

Any & All Radio Station Transmission Equipment, 204 F.3d 658, 662 (6th Cir. 2000)

(Strawcutter) (noting FCC change in position on microbroadcasting).

In addition, this court struggled with and finally resolved similar difficult

jurisdictional issues in an unrelated enforcement action brought by the government

against another unlicensed microbroadcaster. See United States v. Any & All Radio

Station Transmission Equipment, 976 F. Supp. 1255 (D. Minn. 1997) (Fried I), aff’d,

207 F.3d 458 (8th Cir. filed Mar. 27, 2000) (Fried III) (on rehearing by the panel) (the

initial panel opinion was reported at 169 F.3d 548 (filed Feb. 26, 1999) (Fried II)).

Unlike the present case which is a civil action for declaratory and injunctive relief

under 47 U.S.C. 401(a), Fried was an in rem forfeiture action under 47 U.S.C.
2The FCC has several enforcement options: criminal prosecution under 47

U.S.C. § 501, a civil action to enjoin noncompliance under id. § 401(a), monetary

forfeitures to penalize violations under id. § 503, and seizure and forfeiture of radio

equipment under id. § 510(a).

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§ 510(a).2 The government sought to seize and forfeit the broadcast equipment that

Fried used to operate an unlicensed radio station, out of his apartment in downtown

Minneapolis, Minnesota. Like Neset, Fried had never applied for a license, although

he maintained that he had requested a waiver (and the district court assumed for

purposes of analysis that he had). Following a complaint from a licensed FM radio

station, FCC agents investigated and confirmed unauthorized radio transmissions from

Fried’s apartment. In August 1996 the FCC mailed a warning letter to Fried. He

responded to the warning letter by challenging the constitutionality of the

microbroadcasting regulations and requesting a waiver of the licensing requirements,

but he did not cease broadcasting.

Rather than seeking an injunction as it did in the present case, the government

in Fried instead filed an in rem forfeiture action. Fried in his answer raised several

affirmative defenses challenging the constitutionality of the microbroadcasting

regulations. The government argued that the court of appeals, not the district court, had

exclusive jurisdiction to determine the validity of the microbroadcasting regulations,

citing 47 U.S.C. § 402(a) (referencing 28 U.S.C. § 2342, which provides in part that

the court of appeals has exclusive jurisdiction to determine the validity of all final

orders of the FCC made reviewable by 47 U.S.C. § 402(a)). Fried argued that the

district court, not the court of appeals, had exclusive jurisdiction over the forfeiture

action, including his affirmative defenses challenging the constitutionality of the

microbroadcasting regulations, because the specific jurisdictional grant over forfeiture

actions, 47 U.S.C. § 504(a), provides for trial de novo in the district court, a reference
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which he argued contemplated adjudication of all issues raised in the forfeiture action,

including any and all defenses to forfeiture. 

We initially agreed with Fried and held that the district court was the exclusive

forum for review of in rem forfeiture orders. See Fried II, 169 F.3d at 552 (McMillian,

J.), citing Dougan v. FCC, 21 F.3d 1488, 1491 (9th Cir. 1994) (holding 47 U.S.C.

§ 504(a) is a specific review statute which vests exclusive jurisdiction over forfeiture

actions in district court and cuts off general jurisdiction in courts of appeals under 47

U.S.C. § 402(a) to review FCC orders). We also held that the district court had

jurisdiction to consider Fried’s affirmative constitutional defenses. See id. at 553,

citing Dunifer, 997 F. Supp. at 1238. However, we later granted rehearing, 182 F.3d

1026 (8th Cir. 1999), and, upon reconsideration, held that the district court has

exclusive jurisdiction to adjudicate the in rem forfeiture action, but not Fried’s

constitutional challenges to the microbroadcasting regulations; Fried’s defenses

exclusively focused on the validity of the microbroadcasting regulations, and 47 U.S.C.

§ 402(a) and 28 U.S.C. § 2342 clearly confined the review of the validity of FCC

regulations to the courts of appeals, not the district courts. We held that “[a] defensive

attack on the FCC regulations is as much an evasion of the exclusive jurisdiction of the

Court of Appeals as is a preemptive strike by seeking an injunction.” Fried III, 207

F.3d at 463 (Noonan, J.), citing FCC v. ITT World Communications, Inc., 466 U.S.

463, 468 (1984) (ITT) (holding exclusive jurisdiction of the courts of appeals over

rulemaking by the FCC may not be evaded by seeking to enjoin a final order of the

FCC in the district court), and Southwestern Bell Telephone v. Arkansas Public

Service, 738 F.2d 901, 906 (8th Cir. 1984) (“Where exclusive jurisdiction is mandated

by statute, a party cannot bypass the procedure by characterizing its position as a

defense to an enforcement action.”), vacated and remanded on other grounds, 476 U.S.

1167 (1986). But see Strawcutter, 204 F.3d at 667 (holding that district court had

jurisdiction to adjudicate constitutional defenses in forfeiture action) Dougan v. FCC,

21 F.3d at 1490-91 (holding court of appeals lacked jurisdiction over monetary

forfeiture action); United States v. Any & All Radio Station Equipment, 93 F. Supp.
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2d 414, 417-22 (S.D.N.Y. 2000) (rejecting statutory and constitutional defenses raised

by microbroadcaster defendant in forfeiture action, including Religious Freedom

Restoration Act and First, Fourth and Fifth Amendments); see also Prayze FM v. FCC,

214 F.3d 245, 250-53 (2d Cir. 2000) (noting jurisdictional question without resolving

it; court assumed district court had jurisdiction to hear microbroadcaster’s First

Amendment challenges in § 401(a) injunction action because FCC sufficiently

demonstrated that it would likely prevail).

For reversal, Neset argues that the district court erred in holding that he lacked

standing to raise a constitutional claim. Neset argues that he has been directly injured

because he has been enjoined from broadcasting. In his view, the issue is not standing

but rather exhaustion of administrative remedies. Neset argues that the district court

erred in requiring him to exhaust his administrative remedies (by applying to the FCC

for a license, requesting a waiver or petitioning for a change in the regulations) because

it would have been futile to do so. Neset argues that, at the time he was broadcasting

without a license, the FCC was simply not issuing any low-power licenses and had only

granted two waivers since 1978 (one in Alaska and one in a remote part of New

Mexico). Neset also argues that, assuming exhaustion of administrative remedies is

required, the district court should have dismissed the government's action and ordered

the FCC to issue a cease and desist order before seeking injunctive relief, thus invoking

the doctrine of primary jurisdiction.

The government argues that Neset’s constitutional attack on the

microbroadcasting regulations is not a defense to this 47 U.S.C. § 401(a) action seeking

to enjoin him from broadcasting without a license or a waiver. This argument is similar

to its argument in Fried that the district court did not have jurisdiction to adjudicate

affirmative constitutional defenses in a 47 U.S.C. § 510(a) in rem forfeiture action.

See Brief for Appellee at 16-23. The government argues that, even assuming for

purposes of analysis that Neset’s constitutional attack is a defense in this action for

injunctive relief, Neset should instead seek administrative relief by applying for a
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license or a waiver or by petitioning the FCC to institute rulemaking procedures to

amend the microbroadcasting regulations, and then, if administrative relief is denied,

by seeking judicial review in the courts of appeals. See id. at 19. The government also

argues that, because Neset has not applied for a license or sought a waiver or petitioned

the FCC to change the microbroadcasting regulations, he lacked standing to challenge

the microbroadcasting regulations. See id. at 20-21. The government also argues that

exhaustion of administrative remedies would not be futile. See id. at 22. Finally, the

government argues on the merits that Neset has no First Amendment free speech right

to broadcast radio transmissions without a license or a waiver and that his listeners

have no First Amendment free speech right to listen to radio transmissions broadcasted

without a license or a waiver.
3

In order to establish standing and invoke federal jurisdiction, a litigant must

allege an actual and concrete injury consisting of an invasion of a legally protected

interest, a causal connection between the injury and the conduct of which the litigant

complains, and the likelihood that the injury will be redressed by a favorable judicial

decision. See, e.g., Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61 (1992).

Because Neset has not applied for a license or requested a waiver, the

microbroadcasting regulations then in effect have not been applied to him, and he

cannot show a causal connection between the alleged violation of his First Amendment

rights and the FCC's failure to issue low-power broadcast license or grant him a waiver.

See Prayze FM v. United States, 83 F. Supp. 2d 293, 295 (D. Conn. 1999) (holding

plaintiff microbroadcaster lacked standing to challenge regulations because it had not

applied for a license or waiver), aff’d sub nom. Prayze FM v. FCC, 214 F.3d 245,

251-53 (2d Cir. 2000) (holding microbroadcaster lacked standing to bring as-applied

challenge but did have standing to bring facial challenge); United States v. Dunifer, 997

F. Supp. 1235, 1240 (N.D. Cal 1998) (holding defendant microbroadcaster lacked

standing to challenge regulations because he had not applied for a license or waiver),

aff'd on other grounds, 219 F.3d 1004 (9th Cir. 2000); see also Free Speech ex rel.

Ruggiero v. Reno, 200 F.3d 63, 65 (2d Cir. 1999) (per curiam) (holding plaintiff

microbroadcasters lacked standing to challenge FCC's authority to issue cease and

desist order absent allegation that FCC's exercise of that authority caused them any

actual injury or to challenge FCC's authority to initiate forfeiture proceedings absent

allegation that FCC had initiated forfeiture proceeding against them or that it had seized

any of their property). 

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We do not reach the standing issues3 because we hold that under the statutory

scheme the district court lacked subject matter jurisdiction over Neset’s affirmative

defenses attacking the validity of the microbroadcasting regulations. Although Fried

III involved an in rem forfeiture action under 47 U.S.C. § 510(a), we think its rationale

applies as well to actions seeking injunctive relief under 47 U.S.C. § 401(a). See

Dunifer, 219 F.3d at 1007 (applying reasoning in Fried III to § 401(a) injunction

action). But cf. Prayze FM v. FCC, 214 F.3d at 250 (assuming district court had

jurisdiction to hear microbroadcaster’s constitutional challenges in § 401(a) injunction

action). As we noted in Fried III, “the Supreme Court has authoritatively determined

that the exclusive jurisdiction of the Court of Appeals over rulemaking by the FCC may
4Several recent decisions have rejected similar constitutional arguments raised

by other microbroadcasters on the ground that the First Amendment right to free speech

does not include either the right to broadcast radio transmissions without a license or

a waiver or the right to listen to radio transmissions broadcast without a license or a

waiver. See United States v. Any & All Radio Station Transmission Equip., 204 F.3d

658, 665-68 (6th Cir. 2000) (Strawcutter); Free Speech ex rel. Ruggiero v. Reno, 200

F.3d 63, 64-65 (2d Cir. 1999) (per curiam); United States v. Any & All Radio Station

Transmission Equip., 93 F. Supp. 2d 414, 420-21 (S.D.N.Y. 2000); see also National

Broad. Co. v. United States, 319 U.S. 190, 227 (1943) (“The right of free speech does

not include . . . the right to use the facilities of radio without a license.”).

The Sixth Circuit in Strawcutter rejected application of the doctrine of primary

jurisdiction. See 204 F.3d at 664 (holding that doctrine of primary jurisdiction, which

arises when a claim is properly cognizable in court but contains some issue within the

special competence of an administrative agency, does not apply when the specially

competent agency is itself the plaintiff) (citing United States v. Alcon Labs., 636 F.2d

876, 888 (1st Cir.) (noting “deference to an agency’s primary jurisdiction makes little

sense in the context of an enforcement proceeding initiated by the agency”), cert.

denied, 451 U.S. 1017 (1981)).

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not be evaded by seeking to enjoin a final order of the FCC in the district court.” 207

F.3d at 463, citing ITT, 466 U.S. at 468. Fried III expressly extended the statutory

mandate of exclusive jurisdiction from offensive claims to affirmative defenses. Id.,

citing Southwestern Bell Telephone v. Arkansas Public Service, 738 F.2d at 906

(“Where exclusive jurisdiction is mandated by statute, a party cannot bypass the

procedure by characterizing its position as a defense to an enforcement action.”).

Neset’s defensive attack on the validity of the microbroadcasting regulations would be

just as much “an evasion of the exclusive jurisdiction of the Court of Appeals as is a

preemptive strike by seeking an injunction.” Fried III, 207 F.3d at 463. For that

reason, we hold that the district court lacked subject matter jurisdiction over Neset’s

affirmative defenses attacking the validity of the microbroadcasting regulations. We

express no opinion on the merits of Neset’s statutory or constitutional defenses.4
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The district court did have jurisdiction over the § 401(a) injunction action. We

hold that the district court did not abuse its discretion in permanently enjoining Neset

from broadcasting without a license. The record established that Neset was

broadcasting without a license or a waiver in violation of the Communications Act, as

amended. Accordingly, the judgment of the district court is affirmed.

HEANEY, Circuit Judge, dissenting.

I agree with the Sixth Circuit’s decision in United States v. Any & All Radio

Station Transmission Equip., 204 F.3d 658 (6th Cir. 2000) (Strawcutter), that the

district courts in this type of case have jurisdiction to hear First Amendment challenges

to the Federal Communication Commission’s prohibition of microbroadcasting in the

context of an enforcement action filed against them. Accordingly, I would remand to

the district court for further proceedings.

A true copy.

Attest:

CLERK, U. S. COURT OF APPEALS, EIGHTH CIRCUIT.