Court Opinion

ID: 2971630
Source: CourtListenerOpinion
Date Created: 2015-09-22 16:38:04.518787+00
Date Added: 2024-06-11T11:43:36.846077
License: Public Domain

RECOMMENDED FOR FULL-TEXT PUBLICATION
                                         Pursuant to Sixth Circuit Rule 206
                                                  File Name: 04a0440p.06

                          UNITED STATES COURTS OF APPEALS
                                             FOR THE SIXTH CIRCUIT
                                               _________________

                                                         X
                                    Plaintiff-Appellee, -
 KNOLOGY, INC.,
                                                          -
                                                          -
                                                          -
                                                              No. 03-6390
           v.
                                                          ,
                                                           >
 INSIGHT COMMUNICATIONS COMPANY, L.P.; INSIGHT            -
                                                          -
                               Defendants-Appellants. -
 KENTUCKY PARTNERS II, L.P.,

                                                          -
                                                         N
                          Appeal from the United States District Court
                       for the Western District of Kentucky at Louisville.
                       No. 00-00723—Thomas B. Russell, District Judge.
                                              Argued: October 26, 2004
                                     Decided and Filed: December 29, 2004
                 Before: NELSON and COOK, Circuit Judges; SARGUS, District Judge.*
                                                  _________________
                                                       COUNSEL
ARGUED: Laurence J. Zielke, PEDLEY, ZIELKE, GORDINIER & PENCE, Louisville, Kentucky, for
Appellants. Eric L. Ison, GREENEBAUM, DOLL & MCDONALD, Louisville, Kentucky, for Appellee.
ON BRIEF: Laurence J. Zielke, Janice M. Theriot, Adam B. Shadburne, PEDLEY, ZIELKE, GORDINIER
& PENCE, Louisville, Kentucky, for Appellants. Eric L. Ison, Holland N. McTyeire, GREENEBAUM,
DOLL & MCDONALD, Louisville, Kentucky, David O. Stewart, Thomas B. Smith, Robert J. Kovacev,
Robert M. Malone, ROPES & GRAY, LLP, for Appellee.
                                                  _________________
                                                      OPINION
                                                  _________________
        COOK, Circuit Judge. Defendant-Appellants Insight Communications Company, L.P., and Insight
Kentucky Partners II, L.P. (collectively “Insight”) appeal the district court’s decision denying Insight
immunity from Plaintiff-Appellee Knology, Inc.’s Sherman Act and 42 U.S.C. § 1983 claims. Because the
Noerr-Pennington doctrine insulates Insight from liability for its activities here, we reverse the district
court’s decision.

   *
    The Honorable Edmund A. Sargus, Jr., United States District Judge for the Southern District of Ohio, sitting by designation.

                                                              1
No. 03-6390             Knology, Inc. v. Insight Communications, et al.                                   Page 2

                                       I. Facts and Procedural History
       Insight and Knology are cable television service providers. In 1998, the City of Louisville,
Kentucky, passed Ordinance 76, granting Insight a franchise to provide cable services. The ordinance
included a “level playing field” provision, which states:
        The rights and privileges granted by this ordinance to Operator are not exclusive and nothing
        herein is intended to or shall be construed so as to prevent the City from granting other . .
        . franchises . . . provided, however, that [they] are neither “more favorable” nor “less
        favorable” than those granted to Operator herein . . . . Any subsequent franchise shall contain
        a provision suspending the effective date for sixty (60) days during which time after prompt
        written notice is given by the City to Operator, if Operator claims to be aggrieved, parties
        shall seek a Declaration of Rights in a court of competent jurisdiction during which time the
        effective date of the subsequent franchise shall be suspended pending a final and
        nonappealable decision resolving the issue.
        Two years later, Louisville enacted Ordinance 114, creating Knology’s franchise, which provides:
        The Franchise created by this Ordinance shall become effective as to any particular
        Franchisee sixty (60) days after the effective date of the Board of Aldermen’s Resolution
        accepting that Franchisee’s bid; provided, however, that if [Insight seeks] a Declaration of
        Rights . . . the effective date of the Franchise . . . shall be suspended pending a final and
        nonappealable decision resolving the issue.
        As the ordinance anticipated, Insight then sued the City in state court, seeking a declaration that the
City granted Knology a more favorable franchise. That suit triggered the ordinance provision suspending
the effective date of Knology’s franchise until a final, nonappealable decision resolved the issue. Some
thirteen months later, the state court granted summary judgment for the City, finding that the franchises
were substantially similar. The Kentucky Court of Appeals affirmed, and the Kentucky Supreme Court
denied discretionary review.
        Soon after Insight filed in state court, Knology sued Insight and the City in the district court.
Knology argued, among other things, that Insight’s state suit and its invocation of the provision suspending
Knology’s franchise violated the Sherman Act, the Cable Act, and the First Amendment, and that Knology
was therefore entitled to damages under the Sherman Act and 42 U.S.C. § 1983. The district court, ruling
on a motion for partial summary judgment, viewed Insight’s one act—filing suit—as two acts, warranting
two contrary holdings: Insight was immune under the Noerr-Pennington doctrine for its act of filing the
state court action, but not immune for its invocation of the franchise suspension provision (by its act of filing
the state court action). The district court also ruled Insight was not immune from Knology’s § 1983 claims,
because it was a “state actor” when it invoked the suspension. That reasoning led the court to enter
summary judgment for Knology on its § 1983 First Amendment claim.
        Insight appeals the district court’s decision, arguing, among other things, that it is immune from the
Sherman Act and § 1983 claims under Noerr-Pennington. We agree, reverse the district court’s decision
on that issue, and remand the case for further proceedings.
                                       II. Noerr-Pennington Immunity
         The Noerr-Pennington doctrine allows businesses to combine and lobby to influence the legislative,
executive, or judicial branches of government or administrative agencies without antitrust or § 1983
liability, because the First Amendment’s right of petition protects such activities. Eaton v. Newport Bd. of
Educ., 975 F.2d 292, 298 (6th Cir. 1992). The doctrine immunizes parties from liability under antitrust laws
or § 1983 for actions taken when petitioning authorities to take official action, even where the petitioning
No. 03-6390             Knology, Inc. v. Insight Communications, et al.                               Page 3

activity has the intent or effect of depriving another of property interests, except under “very limited
circumstances.” Id.
        Those circumstances exist where parties use the petitioning process, rather than the outcome of that
process, as an anticompetitive weapon. City of Columbia v. Omni Outdoor Advertising, Inc., 499 U.S. 365,
380 (1991). Such a “‘sham’ situation involves a defendant whose activities are not genuinely aimed at
procuring favorable government action at all, not one who genuinely seeks to achieve his governmental
result, but does so through improper means.” Id. (citations, emphasis, and internal quotation marks
omitted).
       Here, the district court appraised Insight’s activities—lobbying for including the suspension
provisions in Knology’s franchise ordinance and filing its state court suit—as legitimate petitioning,
protected by the First Amendment and therefore entitled to Noerr-Pennington immunity. But the district
court went on to decide that:
       the suspension of Knology’s franchise, although triggered by Insight’s lawsuit, was a
       product of contract not sought through litigation. The stay was not subject to governmental
       review, nor was it intended to persuade the government of anything. Instead, it was
       automatic.
        We analyze the issue differently; we see filing the lawsuit and invoking the suspension provision
as a single petitioning activity protected by the First Amendment and Noerr-Pennington. That this
petitioning caused an anticompetitive result is irrelevant to Noerr-Pennington analysis. Insight did not stay
anything—only the government prevented Knology from moving forward in the face of Insight’s suit.
Insight simply spurred the City to comply with its own ordinances, by filing its complaint—action
immunized by Noerr-Pennington and the First Amendment.
        The district court noted that the ordinance Insight’s suit invoked was “a byproduct of Insight’s prior
petitioning.” This, however, is irrelevant. As the district court acknowledged, the prior petitioning was
protected. So was Insight’s lawsuit. Considered separately or together, they cannot give rise to liability.
        We conclude, therefore, that Insight engaged in nothing more than legitimate petitioning. As a
result, Noerr-Pennington bars all of Knology’s claims for damages against Insight arising out of the stay,
foreclosing relief on the other issues raised on appeal.
                                              III. Conclusion
       We reverse the district court’s decision denying Insight Noerr-Pennington immunity and granting
Knology summary judgment on its First Amendment § 1983 claim, and we remand for further proceedings
consistent with this opinion.