Opinion ID: 3050155
Heading Depth: 3
Heading Rank: 3

Heading: Damages under the Telecommunications Act

Text: Nor did the district court err by holding that Kay was not entitled to compensatory damages under the TCA. Congress explicitly created, and Kay sued under, a private right of action in the TCA: Any person adversely affected by any final action or failure to act by a State or local government or any instrumentality thereof that is inconsistent with this subparagraph may, within 30 days after such action or failure to act, commence an action in any court of competent jurisdiction. The court shall hear and decide such action on an expedited basis. Any per- son adversely affected by an act or failure to act by a State or local government or any instrumentality thereof that is inconsistent with clause (iv) may petition the Commission for relief. 47 U.S.C. § 332(c)(7)(B)(v). The district court held in Kay’s favor on his TCA claim, but did not explicitly grant him a remedy under the TCA.7 Section 332 of the TCA does not 7 Both Kay’s TCA and California law claims involve an identical substantial evidence review of the City’s decision. See MetroPCS, Inc. v. City and County of San Francisco, 400 F.3d 715, 723 (9th Cir. 2005); Topanga Ass’n for a Scenic Cmty. v. County of Los Angeles, 11 Cal.3d 506, 514-15 (1974). The district court found for Kay on both causes of action, but the sole remedy granted was the state law remedy of a peremptory writ of mandate under California Code of Civil Procedure section 1095. KAY v. CITY OF RANCHO PALOS VERDES 12915 specify the remedies available to successful litigants, and no circuit court of appeals has squarely addressed the availability of compensatory damages as a remedy. The Supreme Court, however, has provided some guidance, both in the context of attempted use of the Civil Rights Act of 1871, 42 U.S.C. § 1983 to enforce § 332 of the TCA, and more generally in the context of statutes that are silent on available remedies.
[7] The Supreme Court recently held that “the TCA — by providing a judicial remedy different from § 1983 in § 332(c)(7) itself — precluded resort to § 1983,” to enforce violations of § 332. City of Rancho Palos Verdes v. Abrams, 544 U.S. 113, 127 (2005). The Court of Appeals’ decision had reached the opposite conclusion, holding that money damages and attorney’s fees were available for TCA violations enforced through a § 1983 action. Id. at 119 (discussing Abrams v. City of Rancho Palos Verdes, 354 F.3d 1094 (9th Cir. 2004)). Writing for the Court, Justice Scalia briefly noted portions of § 332 that create a thirty-day window for appeals and the requirement of expedited judicial review as examples that the “TCA . . . adds no remedies to those available under § 1983, and limits relief in ways that § 1983 does not.” Id. at 122. “The remedies available [under § 332], moreover, perhaps do not include compensatory damages (the lower courts are seemingly in disagreement on this point), and certainly do not include attorney’s fees and costs.” Id. at 122-23 (footnotes omitted).8 The Court noted that “[l]iability for attorney’s fees would have a particularly severe impact in the § 332(c)(7) 8 The Court cited PrimeCo Personal Communications, Ltd. v. City of Mequon, 352 F.3d 1147 (7th Cir. 2003), for the proposition that some courts have held that damages were available. However, PrimeCo merely recognized, as the Supreme Court later did in Abrams, that the TCA created an enforcement mechanism in § 332 and that 42 U.S.C. § 1983 was not a proper enforcement vehicle. PrimeCo, 352 F.3d at 1152-53. At most, PrimeCo assumed without deciding that damages would be available in a direct § 332 cause of action. Id. 12916 KAY v. CITY OF RANCHO PALOS VERDES context, making local governments liable for the (often substantial) legal expenses of large commercial interests for the misapplication of a complex and novel statutory scheme.” Id. at 123 (citing Nextel Partners Inc. v. Kingston Township, 286 F.3d 687, 695 (3d Cir. 2002) (“TCA plaintiffs are often large corporations or affiliated entities, whereas TCA defendants are often small, rural municipalities.”). Justice Breyer, joined by Justices O’Connor, Souter, and Ginsburg concurred, and pointed out that the quasi-administrative nature of review under § 332 meant that “to permit § 1983 actions . . . would undermine the compromise — between purely federal and purely local . . . policies — that the statute reflects.” Id. at 128-29. Finally, Justice Stevens, writing alone, concurred and expressed the view that “there is not a shred of evidence in the legislative history suggesting that . . . Congress intended plaintiffs to be able to recover damages and attorney’s fees.” Id. at 130. Justice Stevens further stressed “the fact that awards of damages and attorney’s fees could have potentially disastrous consequences for the likely defendants in most private actions under the TCA.” Id. at 132. While the Supreme Court has not ruled on the availability of damages in suits directly under § 332, the concerns expressed in Abrams about the structure and nature of the TCA and Congress’s intent in passing the law pertain as much to suits directly under § 332 as they do to suits seeking remedies via § 1983. With these concerns in mind, we examine the availability of compensatory damages.
“[I]t is . . . well settled that where legal rights have been invaded, and a federal statute provides for a general right to sue for such invasion, federal courts may use any available remedy to make good the wrong done.” Bell v. Hood, 327 U.S. 678, 684 (1946). The Court has subsequently explained that “the federal courts have the power to award any appropriate relief in a cognizable cause of action brought pursuant to KAY v. CITY OF RANCHO PALOS VERDES 12917 a federal statute,” Franklin v. Gwinnett County Pub. Schs., 503 U.S. 60, 71 (1992), and that “denial of a remedy [is] the exception rather than the rule,” id. At the same time, it is critical that when deciding which remedies are appropriate in a given situation, we attempt to “infer how . . . Congress would have addressed the issue” if it had done so at the time the law was passed. Gebser v. Lago Vista Indep. Sch. Dist., 524 U.S. 274, 285 (1998) (quoting Cent. Bank of Denver, N.A. v. First Interstate Bank of Denver, N.A., 511 U.S. 164, 178 (1994)). In Franklin, the Court examined a district court’s dismissal of a Title IX damages action for failure to state a claim, 503 U.S. at 64, and remanded after holding that a damages remedy was appropriate and consistent with the intent of Title IX, id. at 71-76. The Court narrowed this broad rule in Gebser, again examining the purpose and intent behind Title IX, and limiting the circumstances under which damages were an appropriate remedy. 524 U.S. at 292-93. To determine whether damages are appropriate here, we examine Congress’s intent and the structure of § 332. 1. Stated Intent [8] As in Franklin, we first examine whether Congress intended to limit the remedies available for violations of § 332. 503 U.S. at 71. We have no statement of congressional intent on the question of remedies in the legislative history. See Abrams, 544 U.S. at 130 (Stevens, J., concurring). However, unlike the implied Title IX cause of action in Franklin and Gebser, here we have some legislative history discussing the remedial structure created by the statute. Section 332(c)(7), captioned “[p]reservation of local zoning authority,” was intended to minimize federal interference with State and local land use decisions. See H.R. Conf. Rep. No. 104458, at 207-08 (1996) (hereinafter “Conference Report”) (“The conference agreement . . . preserves the authority of State and local governments over zoning and land use matters except in the limited circumstances set forth in the conference agreement.”). 12918 KAY v. CITY OF RANCHO PALOS VERDES [9] Because TCA plaintiffs are often large telecommunications companies, it is likely that the damages attributed by them to adverse zoning or permitting decisions will be substantial, particularly from the viewpoint of a municipality. See Abrams, 544 U.S. at 123. This potential for large damages claims, even if they are not ultimately awarded, suggests that Congress did not intend to create a damages remedy. Just like the attorney’s fees addressed by the Court in Abrams, there is a real danger here that a damages remedy “would have a particularly severe impact in the § 332(c)(7) context, making local governments liable for the (often substantial) [damages] of large commercial interests for the misapplication of a complex and novel statutory scheme.” Id. The specter of large damages claims, and the expensive litigation recognized in Abrams, could easily intimidate local authorities into effectively abdicating their zoning and permitting powers when confronted with an application from a wireless service provider.9 Nor do we find that the requirement that courts “hear and decide such action on an expedited basis,” 47 U.S.C. § 332(c)(7)(B)(v), cuts against this view, as the Nextel Partners court mused in passing. 286 F.3d at 695 (“For defendants, assuming for the sake of argument that damages may be recovered under the TCA itself, quick review may diminish the amount that may be recovered.”) (footnote omitted). In the Central District of California, where Kay filed his action, the median time from the filing of a complaint to disposition of the case after a trial is 23.9 months. Administrative Office of the United States Courts, Federal Judicial Caseload Statistics tbl. C-5 (March 31, 2006). Partially due to the intervening Abrams decision, the City took almost a year to decide Kay’s permit application, and the district court took another two years to hold a bench trial and rule on the merits of the permit issue. This kind of schedule for the resolution of a civil case, 9 As discussed in the context of Kay’s state damages claim, local zoning and permitting authorities are normally immune from damages under state law. KAY v. CITY OF RANCHO PALOS VERDES 12919 even on an expedited basis, is typical. It is unrealistic to expect any case involving administrative review to wend its way through our district courts, let alone the appellate process, in a manner that is speedy enough to meaningfully stave off the accumulation of damages. [10] Congress sought to preserve local authority while also providing a federal forum for the review of certain zoning and permitting decisions without further need to exhaust “any independent State court remedy otherwise required.” Conference Report at 209. A damages remedy does not further that purpose, and could potentially frustrate it. 2. Administrative Nature of Review Several features of section § 332(c)(7) are borrowed from state zoning and administrative review laws. Zoning and permitting decisions are made by municipalities like the City or other regional authorities. Every state provides for review of such agency decisions through an appeal or writ of certiorari to the state courts, and most provide a short time frame in which to file an appeal; thirty-two of those states have a thirty-day appeal period.10 The TCA adopts a similar thirtyday appeal period. 47 U.S.C. § 332(c)(7)(B)(v). The language used by Congress closely mirrors many of those same state laws, allowing “[a]ny person adversely affected by any final action or failure to act” to seek aid from the courts. Id. The TCA also requires that zoning decisions by state and local authorities be “in writing and supported by substantial evidence contained in a written record.” 47 U.S.C. § 332(c)(7)(B)(iii). Congress explained that it used this phrase to reflect “the traditional standard used for judicial review of agency actions.” Conference Report at 208. Most states also apply a similarly deferential standard of review to appeals from local zoning and permitting agency decisions. See 10 Thirty days is the mode, but some states give as few as ten days or as