Court Opinion

ID: 6911750
Source: CourtListenerOpinion
Date Created: 2022-07-23 22:25:07.709716+00
Date Added: 2024-06-11T16:06:31.800302
License: Public Domain

PRETTYMAN, Circuit Judge,
dissenting.
I disagree with my brethren in this ease, and, because I fear that the opinion advances some unwise new law in the administrative field, I state the reasons for my dissent.
I think there is in this record no proper ground upon which a court can reverse the Commission. When this .case was here the first time1 the Commission had held a comparative hearing upon mutually exclusive applications for a radio license, made findings of facts, and awarded a license to one of the applicants. In practical effect the award was to one of two competing communities located just fourteen miles apart. In a unanimous opinion this court discussed at length the features of a choice between two well-qualified applicants. We passed upon several contentions attacking the Commission’s award. In every instance, except one, we sustained the Commission. In that one instance the Commission had found that “Allentown is in greater need of another radio station than Easton” and that the Allentown applicant was better qualified to meet that need, but it made no finding which would indicate why or how it reached those conclusions. Because of that lack, when the findings were attacked we could not tell whether they were arbitrary or not. For that lone reason we remanded the case. The opinion was quite explicit that the remand was to permit the Commission to make the missing findings as to the comparative needs of the communities and the relative abilities of the applicants to meet whichever was the greater need.
Upon the remand the Commission proposed to reopen the récord for further evidence. Both applicants objected. They brought the matter back here. This court, again unanimously, held that it was the Commission’s duty to award applications in satisfaction of public convenience, interest or necessity “at the time of the award”. We declined to forbid the Commission’s holding of further hearings. The hearings were held, and the Commission made findings. I have never seen more meticulous compliance with the requirements for findings by an administrative agency. There are sixty printed pages of them. They are full, understandable, and abundant in references to the evidence.
The reasoning upon which the Commission reached its ultimate decision is clearly stated and is fully justified by the record. After considering the applicants and the communities from every *789conceivable angle, it concluded that “on the basis of most of the above factors and other considerations advanced by the applicants,” there was little room for choice. This was a natural and entirely proper conclusion. We had already remarked in the opinion upon the first appeal that to a disinterested eye two neighboring communities are often relatively the same in merit. The Commission continued: “There is one decisive factor, however, * * This was a proper and, indeed, highly commendable presentation of the view reached by the Commission. Many times two conflicting interests are well-balanced save for one decisive factor. It is the part of honesty to say so frankly, instead of weighting the factors which seem to favor the side which must win and deflating the loser’s assets. In the case at bar the decisive factor was clearly and succinctly stated. It was:
“Allentown is presently served by three standard broadcast stations located in and broadcasting local programs for that city, as well as receiving daytime service from the station located in adjoining Bethlehem, while only one standard broadcast station is located in and broadcast local programs for the Easton community.”
If we can understand that conclusion, and if it is supported by the findings, and if the findings are supported by the evidence, our function as a reviewing court is nil. We cannot determine what is the public interest, etc., or where the balance between the applicants or the communities lies. We can only make sure that the Commission acted within its constitutional and statutory authority. I think it did so in this case, and I do not even formulate, much less express, any view upon the merit of its judgment. It, not the court, as the Supreme Court has frequently said, is the judge of the public interest. And it, not the court, has been empowered by the Congress to distribute radio licenses among the several states and communities. It cannot be arbitrary; a court will prevent that. But, if its conclusions on a comparative selection of a licensee are fairly found, a court has no power in the matter.
My brethren say there is no substantial evidence on the record as a whole “to support the essential underlying finding that the ability of the applicants to serve their respective communities was about equal.” They specify the particulars in which they think the lack lies.
First. The court says that there is no substantial evidence on the record as a whole to support the Commission, in that the Easton applicant was uncertain as to its programming plans. The point centers about the testimony of a Mr. Rounsley. I do not read that testimony as my brethren do. It seems to me that the cross-examining attorney was trying to make the witness say things the cross-examiner wanted him to say but with which the witness did not agree. The witness insisted that, while Easton had no then-present plans for affiliation, it would, if it got the license, see what was available in the way of network affiliation and if a desirable one was available “we would probably call them.” The cross-examiner tried to make him say that Easton did not intend to affiliate with a network, but the witness refused to say that. I see nothing indefinite about that testimony under the circumstances. Easton had not been on the air. The applications for the license had been pending six years. To hold extant a firm commitment from a network for that length of time would appear to me to be an amazing feat, and an unblushingly affirmative assertion about securing a network contract would seem to me to be pure and simple sales talk. On the other hand Allentown had been on the air since February, 1949, having been granted a license in the early stages of this proceeding. It had a network affiliation. At the hearing in 1951 Allentown was definite as to what it would do if it kept its license; it would continue to do 'what it wás doing. Easton might *790well have been thinking that if it ousted Allentown from the disputed license it might take over Allentown’s network contract.
To me it seems completely unrealistic to say that there is no substantial evidence in a record to support a finding of equal ability of two applicants because the applicant which had been operating under a license for two years was definite as to its program contracts while the applicant who was merely- hoping at that stage and had to rely upon future events to make firm outside commitments was uncertain about them. If that is to be a policy the initial winner in the early rounds of one of these battles has a well-nigh insurmountable advantage over its rivals. The issue is ability —not past performance but future ability. The court seems to say that, if the initial loser cannot be definite and firm as to his program contracts, there is no substantial evidence to support a finding that his ability is equal to that of his rival who has been on the air pendente lite. To me this part of the court’s view is without substantial foundation and is erroneous in the processes of its reasoning.
Second. The court says that there was no substantial evidence on the record as a whole to support the Commission’s finding, in that Easton’s principal witnesses were reluctant, evasive, and lacked candor. The hearing examiner held to that effect; the Commission overruled her on the matter; the court says that the Commission erred, because certain matters convince the court that there was no substantial preponderante in the testimony against the trial examiner’s view.
The court relies upon a statement .by Judge Learned Hand in the Universal Camera case.2 But Judge Hand was writing after the original decision in that case, supported by an opinion by him, had been reversed by the Supreme Court.3 The natural frame of mind consequent to such circumstance moved Judge Frank to a delightful concurrence which throws much light upon the opinion of Judge Hand. The Labor Board had in that case reversed a finding made by one of its examiners. The Second Circuit was puzzled by the situation thus created but held that while the Board could not ignore an examiner’s findings a reviewing court could not consider the ■Board’s action in reversing the finding a factor in the court’s own decision. The Supreme Co.urt discussed the matter at length.4 It held that an examiner’s findings are not as unassailable as are a special master’s under the Civil Rules ;5 that “The ‘substantial evidence’ standard is not modified in any way when the Board and its examiner disagree”; that evidence may be less substantial when an examiner has rejected it than it is when he adopts it; that his findings “are to be considered along with the consistency and inherent probability of testimony”; and that “The significance of his report, of course, depends largely on the importance of credibility in the particular case.”
With the Supreme Court, opinion on the point before us, we look at the case at bar. The examiner held that “management officials” of Easton “have been reluctant, evasive and evidenced a lack of candor”.. She specified instances-on the part of the president and general manager (one man) and said “Other examples of evasiveness and lack of candor on the part of the general manager” of the proposed Easton station were considered, but I do not find what those examples were. Exception to the findings having *791been filed, the Commission considered them and failed to find the evasiveness and lack of candor the examiner found. The examples she cited, and which the court now discusses, are easy to consider upon the face of the record. They are not premised upon demeanor.
The first example is the program planning which we have discussed. I not only do not see evasiveness or lack of candor in it; the testimony seems fair, honest and complete to me. The second example is that the president of the company could not testify to the amount of the dividends declared in the year 1950. Here are the pertinent questions and answers, as they appear in the joint appendix before us:
"Q. Did the corporation declare dividends last year? A. Yes.
“Q. What was the size of the dividend? ******
“* * * A. I don’t know that without checking the record.”
To me that testimony was not evasive and did not lack candor. Corporate officials testifying to a maze of figures, as this one was, frequently insist upon reference to the records for detailed figures as a matter of caution and accuracy. Indeed wise counsel forewarn witnesses against testifying by unrefreshed recollection on corporate statistics. If the object of the examination is the truth, the records are the best evidence. If the object is to test credibility, corporate statistics are not the field in which to do it. In the present case the records were available; indications aré they were in the hearing room. I think the witness demonstrated commendable care.
The third example is that the president of the company testified to the published circulation figures of several newspapers which were circulated in the East-on area but upon cross examination it developed that the actual circulation of those papers in Easton itself was very small. The examiner said that by the direct testimony “he created the impression that the Easton Express has substantial competition from the Allentown and Bethlehem daily newspapers”, whereas, in fact, as he showed on cross examination, this competition did not exist. The question asked this witness on direct examination was prefaced by a remark by his counsel that in some prior hearing a question had been asked about the circulation of a Bethlehem, Pennsylvania, paper; the witness was asked if he had that figure. He replied that an association of newspapers published those figures, and he read the published figures for a number of newspapers into the record. His counsel then passed on to other matters. Opposing counsel picked up the subject and asked about the circulation figures in the Easton city zone. The witness read the figures from the same publication.
I note a few features of this episode. (1) No false statement is alleged to have been made. One counsel asked for some figures, and his opponent asked for more. All were truly given. (2) The nub of the present point is an impression on the part of the examiner that the witness attempted to create an impression. If it was an attempt by the witness it was not too smart an attempt. All the figures were apparently in the same publication, readily available to anybody. (3) The point was trivial. The Easton Press is the only paper published in Easton. How many out-of-town papers were sold there was of minimal importance. (4) Trial counsel generally will be startled to learn that, if they inquire about a subject and an opponent develops further facts about it, this court is of opinion that the failure of initial full development upon direct examination can, in the absence of any false statement, be used as a basis for reducing all the testimony on that side of the case to less than substantiality. I think so mighty a conclusion cannot properly be drawn from so tiny a premise.
So, when I examine the three examples given in support of the position that Easton’s principal witnesses were reluctant, evasive, and lacked candor, which are instances easily checked on the writ*792ten record, I 'find no substance whatever. As to other instances of evasion, etc., not identified by the examiner, I cannot consider them, because I do not know what they are. Neither does the court kn®w.
My brethren say that the examiner’s conclusions as to reluctance and evasion were based upon demeanor, bearing, delivery, etc., and in a footnote refer to the examiner’s findings as to attitudes and impressions. This is a wide departure from the proper purpose and use of the demeanor test in respect to testimony as I understand it. The demeanor of a witness may be an indication whether he is or is not telling the truth. It is a reactor of credibility. But if a witness is telling the truth, his demeanor in telling it is no factor in its acceptability. The parade of witnesses is not a popularity-contest. The truth need not-fall trip-pingly from the lips; it may come haltingly, timorously, cautiously. But if it is the truth, the mannerisms of its -delivery are no detraction. And so if a witness tells the truth, a hearing officer cannot say, “To be' sure, he told the truth but I got an impression that he would have liked to, deceive me, and so I will not accept his statements.” The examiner in the case at bar did no such thing as that. She found evasion and lack of candor in what the witness did, not in how he did it. She rejected his testimony because of the substance of it, not because of the demeanor of the witness in the delivery of it. For example, in respect to the newspaper circulation incident, she found evasion in the fact that the witness on direct examination read into the record the total circulation figures but not the Easton area circulation. She did not find evasion because of his manner of reading. There is no question as to the truth of the figures he read. Whether he was myopic, unnecessarily cautious or meticulous, stuttered or spluttered was no part of her consideration, as I understand her reasoning. She found evasion because he read some figures and did not read others. The same observations apply to the other item mentioned by my brethren, the network plans. The evasion found by the examiner was in the substance of the testimony. She simply did not believe that the Company had made no plans. If the witness had said it with the charm of a television commercial, she still would not have believed it. Demeanor was not the index of the evasion; the substance of what was said was; evasive in the examiner’s view. I think the examples of alleged evasiveness in this case are precisely the sort which an agency can itself evaluate upon the record.
The Commission itself found no evasiveness and reversed its examiner’s conclusions. The Supreme Court held in Universal Camera, supra, that the findings of the hearing examiner do not have to be clearly erroneous to be reversed by the agency. “The responsibility for decision”, said the Court, “thus placed on the Board” is inconsistent with the clearly-erroneous requirement.6
This court reverses the Commission on this point because it finds no substantial preponderance in the evidence against, the examiner’s views. The court gets-that rule, as I have pointed out, from Judge Hand’s comment upon the Supreme-Court opinion in Universal Camera. I am not sure what Judge Hand’s statement means in the abstract, when read in the light of the Supreme Court’s clear statement that an examiner’s findings, can be reversed by the agency for less-than clear error. But I am sure that his statement does not deny the power of the agency in a case like the one before us. In the first place the lack of justification for the examiner’s conclusions in the three instances she specified is as clear as a record can be. In the second place even the total of the three examples is no justification whatever for the blanket conclusion that there is no> substantial evidence. The cited examples, even if accurately evaluated, are only small reeds; they are not footings; *793for a heavy superstructure. I think my brethren are in flat conflict with the Supreme Court ruling when they reverse the Commission on these differences between the Commission and its hearing examiner.
Moreover the court seems to equate an agency’s power to reverse its own examiner’s finding with a reviewing court’s power to reverse the agency’s finding. It cites cases dealing with a court’s power. This is interesting because in one cited Second Circuit case7 Judge Frank cites and quotes from another Second Circuit opinion,8 in which the court differentiated between “testimonial inferences”, based upon estimates of credibility, and “derivative inferences”, inferred from the testimony. The court may disregard the latter, said Judge Frank, and added: “And we must disregard such a finding when the derivative inference either is not rational or has but a flimsy foundation in the testimony.”9 The conclusions in dispute in the case at bar, as made by the trial examiner, were most truly “derivative inferences”, and moreover, to my way of thinking, had but flimsy foundations in the testimony. They could, and should, have been disregarded by the Commission. Furthermore I do not think the power of the court to reverse the agency is as extensive as is the power of the agency to reverse its examiner. That is the plain teaching of the Universal Camera case and also of the Administrative Procedure Act, as I read them. And such is the reasonable rule, because the whole rationale of administrative procedure rests upon findings by the agency, the body empowered by Congress to make the adjudication. Of course, in a disputed finding which depends upon demeanor, or upon some other feature better estimated by the person who sees the witnesses, observes their gestures, delays, etc., and hears their intonations, inflections and emphases, that person is best able to resolve the dispute. But where findings are made from factual data, or factual statements, the responsibility for the action is upon the agency itself. In such instances it cannot be bound to make a finding which it does not believe to be accurate. In the case before us the alleged “evasiveness” was not a matter of demeanor but a matter of factual substance of testimony.
Third. The court entitles this part “Monopoly and concentration of communications media.” The facts are important. There is now only one standard broadcast station in Easton; it is not owned by the present applicant. Allentown has three standard stations. In respect to standard stations, therefore, the question is whether Easton should have a second station, bringing competition to a present monopoly, or Allentown should have four. Of course many other considerations enter, all as pointed out in our opinion in the first appeal. For example, Easton has two FM stations, one of which is owned by appellee, while Allentown has one operating and one under-consideration FM station. It is agreed that so far as receivers are concerned the FM broadcasts are a minor consideration. The point here is that the “monopoly” feature is not a simple black-and-white problem.
In the next place the permissible amount of concentration of mass communication, involving broadcast stations and newspapers, is peculiarly a problem for the Commission. Here, indeed, is a regulatory problem. Ownership of a station by a newspaper can hardly be denounced per se. In the District of Columbia two of the four radio-television stations are owned by newspapers. In the instant ease the Commission weighed many factors in this connection and produced a judgment on the point. I think the court should let it alone.
On the basis of the foregoing three considerations — (1) indefiniteness of *794program plans, (2) evasiveness of witnesses, and (3) concentration of communication media — the court concludes that there is no substantial evidence on the record as a whole to support the Commission’s conclusion that the ability of Easton to serve its community is equal to the ability of Allentown to serve its community. I think, as I have indicated, that none of the three specifications has substance. I think, further, that the conclusion of the court does not follow from its specifications. Even if Easton’s program plans were indefinite as to network affiliation, and its witnesses were evasive in the manner specified (network plans, unrefreshed recollection as to dividends, and the newspaper circulation matter), and the local newspaper would own one of the two standard radio stations, it does not follow that there is no substantial evidence of Easton’s equal ability. There is ample evidence in the record on the point, as the fully documented findings readily show. The court does not merely differ with the Commission upon the relative evaluation of the applicants’ abilities. It does not merely say there is less evidence in support of Easton, than in support of Allentown. It strikes relative evaluation entirely from the case. It says there is no substantial evidence — none—in favor of Easton. It might be proper (although I would not agree with it) for the court to say that in view of the three specifications it is of opinion that the evidence of the. ability of Easton is less than the evidence of the ability of Allentown. But it could not reverse the Commission on that basis. It can reverse only if there is no substantial evidence, on the record as a whole, to support the Commission’s conclusion. The court finds no such evidence. I think its conclusion to that effect is not supported even by the three specifications it makes. It seems to me that the court is merely substituting its judgment for the judgment of the Commission as to which of' these two applicants should have the license. It has no power to do that.
I would affirm.

. Easton Pub. Co. v. Federal Communications Comm., D.C.Cir., 1949, 85 U.S.App. D.C. 33, 175 F.2d 344.

. National Labor Relations Bd. v. Universal Camera Corp., 2 Cir., 1951, 190 F.2d 429.

. Universal Camera Corp. v. Labor Bd., 1951, 340 U.S. 474, 71 S.Ct. 456, 95 L.Ed. 456.

. Id., 340 U.S. at pages 492-497, 71 S.Ct. 456 at pages 467-469.

. A master’s findings are reversible only if clearly erroneous. Fed.Rules Civ.Proc. rule 53(e) (2), 28 U.S.C.A.

. Supra note 3, 340 U.S. at páge 492, 71 S.Ct. at page 467.

. National Labor Relations Board v. Dinion Coil Co., 2 Cir., 1952, 201 F.2d 484.

. American Tobacco Co. v. The Katingo Hadjipatera, 2 Cir., 1951, 194 F.2d 449.

. Id., 194 F.2d at page 451.