Court Opinion

ID: 185197
Source: CourtListenerOpinion
Date Created: 2011-02-05 02:28:56+00
Date Added: 2024-06-11T17:26:13.916235
License: Public Domain

213 F.3d 761 (D.C. Cir. 2000)
Orion Communications Limited, Petitionerv.Federal Communications Commission and United States of America, RespondentsLiberty Productions, A Limited Partnership, et al., Intervenors
Nos. 98-1424, 98-1434, 98-1444, 98-1445, 98-1523, 99-1188,99-1212, 99-1249, 99-1260, 99-1423
United States Court of AppealsFOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued May 19, 2000Decided June 13, 2000

On Petitions for Review of Orders of the Federal Communications Commission
Stephen C. Leckar argued the cause for petitioner Orion  Communications Limited, et al.  With him on the briefs were  Richard F. Swift, Donald J. Evans, Gene A. Bechtel, Stephen  T. Yelverton and Loren A. Colby.
James K. Edmundson argued the cause and filed the briefs  for petitioners Dewey Matthew Runnels and Howard G. Bill.
Dennis P. Corbett argued the cause for petitioner Davis  Television Duluth, LLC., et al. and Intervenors Riverbank  Restaurants, Inc., et al.  With him on the briefs were Loren  A. Colby and Timothy K. Brady.
Daniel M. Armstrong, Associate General Counsel, Federal  Communications Commission, argued the cause for appellees. With him on the brief were Christopher J. Wright, General  Counsel, C. Grey Pash, Jr., Attorney, Joel I. Klein, Assistant  Attorney General, United States Department of Justice, Robert B. Nicholson and Robert J. Wiggers, Attorneys.
Stephen T. Yelverton, Timothy K. Brady, Donald J. Evans,  Thomas A. Hart, Jr. and Scott C. Cinnamon were on the  brief for intervenors.
Before:  Ginsburg, Tatel and Garland, Circuit Judges.
Opinion for the Court filed Per Curiam.

Per Curiam:

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In the Balanced Budget Act of 1997, Congress  amended section 309(j) of the Communications Act of 1934 to  require competitive bidding for commercial broadcast services, replacing the Commission's historic practice of awarding such licenses through comparative hearings.  See Balanced Budget Act of 1997 S 3002(a)(1), Pub. L. No. 105-33,  111 Stat. 251, codified at 47 U.S.C. S 309(j).  Following a  notice of proposed rulemaking, the FCC issued two orders  implementing section 309(j).  First Report and Order, 13  FCC Rcd. 15920 (1998);  Memorandum Opinion and Order,  14 FCC Rcd. 8724 (1999).  Various parties filed petitions for  review of these orders.  In this opinion, we consider the  petition for review in No. 99-1188.  We resolved all of the  issues raised by the other petitions in a separate order issued  herewith.

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In the First Report and Order, the FCC determined that applicants for broadcastservice auctions would be subject to  its anti-collusion rule, 47 C.F.R. S 1.2105(c)(1), which it had  previously applied in sixteen spectrum auctions.  First Report  and Order, 13 FCC Rcd. at 15980-81 p  155.  This rule  provides that, following the filing of short-form applications,

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applicants are prohibited from cooperating, collaborating, discussing or disclosing in any manner the substance of their bids or bidding strategies, or discussing or negotiating settlement agreements, with other applicants until after the high bidder makes the required down payment, unless such applicants are members of a bidding consortium or other joint bidding arrangement identified on the bidder's short-form application....

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47 C.F.R. S 1.2105(c)(1).  In other words, applicants may not  negotiate settlement agreements after their short-form applications have been filed.

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Petitioners contest the FCC's application of its anti-collusion  rule, urging instead that the Commission permit  applicants to negotiate settlement agreements within a reasonable interval--they suggest ninety days--of the date of  filing.  They first contend that the anti-collusion rule violates section 309(j)(6)(E), which provides:

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Nothing in this subsection, or in the use of competitive bidding, shall be construed to relieve the Commission of the obligation in the public interest to continue to use engineering solutions, negotiation, threshold qualifications, service regulations, and other means in order to avoid mutual exclusivity in application and licensing proceedings.

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47 U.S.C. S 309(j)(6)(E) (emphasis added).  Making a Chevron step one argument, petitioners claim that "Congress both  intended and expressly provided that the Commission is  obliged in the public interest to use settlements (i.e., 'other  means') to avoid mutual exclusivity in broadcast auction proceedings."

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The question we ask at Chevron step one is whether  Congress has "directly spoken to the precise question at  issue."  Chevron, U.S.A., Inc. v. Natural Resources Defense  Council, Inc., 467 U.S. 837, 842 (1984).  We cannot see how section 309(j)(6)(E) speaks to the precise question of whether  the FCC must permit a reasonable interval for settlement  negotiations when the statute does not even mention settlements, let alone a specific time interval for negotiations.  To  be sure, settlements are "other means" of avoiding mutual  exclusivity, but the statute cannot be read to direct the FCC  to adopt all other means available.

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Petitioners next claim that the Commission's application of  the anti-collusion rule is arbitrary and capricious, arguing  that "the Commission never explains why, in its view, the  provision for a reasonable interval for settlement is irreconcilable with its policy to deter collusion."  We disagree.  The  Commission more than adequately explained its reasons for  applying the anti-collusion rule.  "Permitting competing applicants for new facilities in all broadcast services to engage  in discussions concerning settlements or other resolution of  their mutual exclusivities following submission of their short form applications," the Commission said, "would, we believe,  reduce the effectiveness of the anti-collusion rule."  Memorandum Opinion and Order, 14 FCC Rcd. at 8755 p 61.  The  Commission elaborated:

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For example, if competing broadcast auction applicants were permitted to engage in discussions concerning settlement or other resolution of mutual exclusivities,  these competing applicants would almost inevitably transfer in formation at least indirectly affecting bids or bidding strategies, thereby adversely impacting the competitive-ness of the auction.  Moreover, given our statutory obligation to utilize auctions as a primary licensing tool, the protection of the integrity of the auction process is of paramount importance, and we are consequently concerned about actions that compromise the integrity of the process, particularly behavior that violates the anti-collusion rule.  The Commission'sexperience in conduct-ing numerous previous auctions has demonstrated the importance of the anti-collusion rule in preventing and facilitating the detection of collusive conduct.

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Id. (internal quotation marks omitted).  Finding this explanation entirely reasonable, we deny the petition for review.

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So ordered.