Court Opinion

ID: 9439091
Source: CourtListenerOpinion
Date Created: 2023-08-03 06:21:07.91777+00
Date Added: 2024-06-11T17:26:09.022303
License: Public Domain

RANDOLPH, Circuit Judge,
concurring in part and dissenting in part:
• Time Warner’s claim—that the Federal Communications Commission should have allowed it. to recoup external cost increases occurring during the so-called “gap” period— should not have been considered by this court.
Not once during the administrative and judicial proceedings leading up to this case did Time Warner make that claim, or a single argument in support of it—not during the original rulemaking, not in its first petition for review in this' court, not in its motion for expedited consideration, not in its briefs in this court, riot during the Commission’s proceedings on remand, and not in a petition for administrative reconsideration. Our opinion in Time Warner Entertainment Co. v. FCC, 56 F.3d 151 (D.C.Cir.1995), said nothing on the subject, and for good reason. We usually do not pronounce on questions no one has presented.
After we remanded the case, Time Warner could have placed its claim and its supporting arguments before the Commission. Time Warner surely knew of the rules allowing this. See 47 C.F.R. § 1.1206 (1995). Yet during the ensuing eighteen months, while the ease remained’pending before the Commission, Time Warner chose to do nothing. We have held time and again, in cases involving this and other administrative agencies, that if a party does not raise and argue an issue before the agency, the court will not consider it. See, e.g., the cases cited below. That “common law” or nonstatutory rule of exhaustion, a rule we also apply on appeals from the district court, is enough to preclude Time Warner’s claim in this court. There is still another reason why we should not consider the claim. Even after the Commission issued its Order on Remand, Time Warner could have filed a motion for reconsideration. *83Again, it chose to remain silent. Section 405 of the Communications Act therefore stands as an additional bar to judicial review of Time Warner’s recoupment claim. In the words of §‘405, 47 U.S.C. § 405, the Commission had “no opportunity to pass” upon the “legal questions” raised by arguments Time Warner is now making for the first time in this court. Those legal arguments consist of analogies to Commission decisions dealing with the “Exchange Network Facilities for Interstate Access,” to decisions of the Federal Energy Regulatory Commission allowing gas pipelines to impose retroactive surcharges, and so on. To state the obvious, the Commission never had a chance to pass on Time Warner’s legal arguments concerning the agency’s remedial discretion because Time Warner never presented those arguments to the Commission. “It is,” we recently reiterated, “only through the adversarial process (or analogous circumstances) that the Commission is afforded such an opportunity within the meaning of § 405.” Bartholdi Cable Co. v. FCC, 114 F.3d 274, 280 (D.C.Cir.1997). We also stressed that it is not up to the Commission to “sift pleadings and documents” in an effort to predict what might have been argued if the litigant had taken the trouble to present the claim. Id. at 279; see also, e.g., Russian River Vintage Broadcasting v. FCC, 5 F.3d 1518, 1521 (D.C.Cir. 1993).1
The majority refuses to follow this well-marked path. Instead, it heads up a blind alley searching for a distinction between something called a “technical” defect and something described as a “policy” difference. See maj. op. at 80-81. As best I can make out, the majority thinks it has discovered a trend: litigants trying to raise “technical” defects in court without having raised them before the Commission will lose, but litigants raising “policy” differences for the first time in court, without having presented their arguments to .the Commission, might.just get away with it.2
So far as I can tell, this technical-policy trend winds up playing no discernible role in the outcome. Still, a few words about the majority’s digression are in order. For starters, the distinction lacks any coherent rationale. The majority suggests that requiring a litigant to raise a procedural or “technical” point with the agency may allow the agency to correct its error before the case reaches the court. See maj. op. at 80-81. This is true, but it is also true about “policy” or “substantive” mistakes. Besides, as any student of administrative law knows, allowing an agency the chance to correct its errors is only one of many reasons behind the raise-it-or-waive-it rule. For instance, the “exhaustion doctrine recognizes the notion, grounded in deference to Congress’ delegation of authority to coordinate branches of Government, that agencies, not the courts, ought to have primary responsibility for the programs that Congress has charged them to *84administer.” McCarthy v. Madigan, 503 U.S. 140, 145, 112 S.Ct. 1081, 1086-87, 117 L.Ed.2d 291 (1992); see, e.g., McKart v. United States, 395 U.S. 185, 192-95, 89 S.Ct. 1657, 1661-63, 23 L.Ed.2d 194 (1969). “Exhaustion concerns,” the Supreme Court added, “apply with particular force when the action under review involves exercise of the agency’s discretionary power or when the agency proceedings in question allow the agency to apply its special expertise.” McCarthy, 503 U.S. at 145, 112 S.Ct. at 1086. In its brief, Time Warner treats the Commission’s authority to. allow recoupment as a matter of agency “discretion” and so. the Court’s words in McCarthy should have had particular force here. Of all things, remedial claims of the sort Time Warner raises in this court ought to be at the top of the list of items a litigant must first raise before the Commission.3
It is therefore hardly surprising that careful attention to our decisions reveals that the majority’s technical-policy line doqs not exist. Take, for instance, Petroleum Communications, Inc. v. FCC, 22 F.3d 1164 (D.C.Cir.1994), a case in which the petitioners claimed the Commission had failed to give notice and an opportunity to comment before promulgating a rule—a mere “technical defect” according to the majority. See maj. op. at 80-81. The majority seems to have forgotten the balance of the cage. The Petroleum Communications petitioners also argued that the rule had been applied in a discriminatory fashion. See Petroleum Communications, 22 F.3d at 1171. Both claims were raised for the first time in the petition for-review. We refused to reach the merits of either issue for “substantially the same reasons,” namely that “petitioners failed to exhaust their remedies ... by declining to bring [the alleged error] first before the Commission.” Id. To take another recent case, Freeman Engineering Associates, Inc. v. FCC, 103 F.3d 169, 182 (D.C.Cir.1997), treated a socalled “technical defect” (petitioner argued that the Commission failed to address certain record evidence) and an alleged substantive error (petitioner claimed the Commission treated him different than other similarly situated applicants) identically: the court held that both claims were waived because petitioner failed to -raise them first before the Commission. In Alianza Federal de Mercedes v. FCC, 539 F.2d 732, 739 (D.C.Cir.1976), we held that the Commission had not been given a “fair opportunity” to pass on petitioner’s argument, raised for the first time before this court, that a television station’s broadcast license should not have been renewed because it offered a minimal amount of public interest programming devoted to minority community problems where minorities comprised 40% of the market. In Washington Ass’n for Television & Children v. FCC, 712 F.2d 677, 680-81 (D.C.Cir.1983), we held that § 405 precluded our considering the challenge to the Commission’s license renewals on the ground that the television stations had provided inadequate weekday programming for children. In Illinois Bell Telephone Co. v. FCC, 988 F.2d 1254, 1264 n. 12 (D.C.Cir.1993), we invoked the exhaustion doctrine to refuse to pass on allegations that the Commission had been “impermissibly inconsistent.” In Northwestern Indiana Telephone Co. v. FCC, 824 F.2d 1205, 1210 n. 8 (D.C.Cir.1987), we declined to reach the merits of petitioners’ last minute argument that the Commission violated the First Amendment. Petitioners, we held, could not “bypass statutory exhaustion requirements.” Id. And in ASTV v. FCC, 46 F.3d 1173, 1177 (D.C.Cir.1995), we refused to consider ASTVs argument that “wireless cable is a ‘cable system’ under the Act, because ASTV failed to raise it before the Commission”—surely a substantive, “policy” matter rather than what the *85majority would treat as a mere “technical’ peccadillo.
The majority ultimately comes to rest on grounds other than its technical-policy dichotomy. The Commission loses because it was playing something called “gotcha,” it was “unfair,” its view of the matter was “farfetched,” it relied on a “disingenuous gimmick.” Maj. op. at 81-82. All this excitement is directed at a footnote in the Commission’s decision on remand. The footnote quoted a Time Warner motion conceding that cable operators could not recoup the losses they were incurring even if “they ultimately succeed in persuading this Court to rule in their favor,” Memorandum of Law of Time Warner Entertainment Company, L.P. in Support of Its Emergency Motion for Expedited Consideration, at pp. 17-18. That concession directly contradicts Time Warner’s current position. The Commission rightly took the statement in context: Time Warner was referring to the effect of delaying review of the entire “rate-regulation rulemaking.” Id. at 17. “The truth is,” according to the majority, “that parties often claim that drastic harm will occur when seeking expedited consideration.” Maj. op. at 81. Maybe so, but that misses the point. If Time Warner believed that it was entitled' to recoup its losses, if the company thought the question was still open despite what it told this court, it was incumbent upon Time Warner to make its views known to the Commission. It had ample opportunity to do so, not only while the matter was pending before the agency on remand, but also after the Commission handed down its decision. Time Warner nevertheless remained mute.
Pure and simple, the majority has offered no good reason for rejecting the Commission’s determination not to decide a legal claim Time Warner neither raised nor supported with pertinent authorities. If “gotcha” and “disingenuous gimmick” are meant to embody a legal principle, I confess—the principle eludes me. I therefore dissent from this portion of the majority opinion.

. The majority is quite mistaken in supposing that § 405 ousts the judicially-imposed requirement that parties present their claims to the Commission before the agency decides the matter. Maj. op. at 79 n.5. Section 405 deals only with petitions for agency reconsideration, which necessarily come after the Commission's decision. To read § 405 as the majority does sub silentio is to render it senseless: parties would be free to hide their contentions,’ to say nothing while the proceedings wind their way to a final agency decision, and then, only after the decision comes down, spring their arguments on the Commission and march into court when the Commission refuses to consider them. The courts of appeals do not allow anything of the sort. New arguments'—that is, arguments that could have been made but were not—may not be raised in petitions for rehearing.
Section 405 thus does not deal with the question whether, in order to have claims considered on judicial review, parties must present those claims to the Commission before it renders its rulemaking or adjudicatory decision. In light of this statutory gap, the federal courts may fill it by insisting that if parties fail to raise their claims prior to final agency action, those claims will not be considered on judicial review. McCarthy v. Madigan, 503 U.S. 140, 144, 112 S.Ct. 1081, 1085-86, 117 L.Ed.2d 291 (1992), made this very point, adopting Justice White's statement in Patsy v. Board of Regents of Florida, 457 U.S. 496, 518, 102 S.Ct. 2557, 2568-69, 73 L.Ed.2d 172 (1982) (concurring in part), that "exhaustion is a ‘rule of judicial administration,' ... and unless Congress directs otherwise, rightfully subject to crafting by judges." Here, Congress has not directed otherwise.

. The majority suggests that exhaustion is entirely controlled by statute, see maj. op. at 79 n.5, and then contradicts itself by proposing a technical-policy distinction found in no statute.

. Darby v. Cisneros, 509 U.S. 137, 113 S.Ct. 2539, 125 L.Ed.2d 113 (1993), cited by the majority in a footnote, see maj. op. at 79 n.5,. has nothing to do with this case. Darby interpreted § 10(c) of the Administrative Procedure Act, 5 U.S.C. § 706(2)(A), to mean that an "an appeal to superior agency authority’ is a prerequisite to judicial review only when expressly required by statute or when an agency rule requires appeal before review and the administrative action is made inoperative pending that review.” 509 U.S. at 154, 113 S.Ct. at 2548. See Marine Mammal Conservancy, Inc. v. Department of Agric., 134 F.3d 409, 411 (D.C.Cir.1998). No one is saying Time Warner should have, or could have, perfected an intra-agency appeal—the Commission rendered the decision under review and the Commission, of course, is the superior agency authority.