Court Opinion

ID: 3035786
Source: CourtListenerOpinion
Date Created: 2015-10-13 22:53:12.584547+00
Date Added: 2024-06-11T12:30:11.898486
License: Public Domain

FOR PUBLICATION
  UNITED STATES COURT OF APPEALS
       FOR THE NINTH CIRCUIT

SPRINT PCS ASSETS, L.L.C., a             
Delaware limited liability
company, wholly-owned by SPRINT
TELEPHONY PCS, L.P., a Delaware
limited partnership,
                  Plaintiff-Appellant,
                  v.
CITY OF LA CAÑADA FLINTRIDGE, a
public entity; STEPHEN A. DEL
GUERCIO, in his official capacity as
Mayor of the City of La Cañada                 No. 05-55014
Flintridge; LAURA OLHASSO, in her
official capacity as Mayor Pro                  D.C. No.
                                             CV-03-00039-DOC
Tem of the City of La Cañada
                                                OPINION
Flintridge; ANTHONY J.
PORTANTINO, in his official
capacity as Council Member of
the City of La Cañada Flintridge;
GREGORY BROWN, in his official
capacity as Council Member of
the City of La Cañada Flintridge;
DAVID A. SPENCE, in his official
capacity as Council Member of
the City of La Cañada Flintridge,
              Defendants-Appellees.
                                         
        Appeal from the United States District Court
           for the Central District of California
         David O. Carter, District Judge, Presiding

                   Argued and Submitted
           October 19, 2005—Pasadena, California

                              733
734        SPRINT PCS v. LA CAÑADA FLINTRIDGE
                 Filed January 17, 2006

 Before: Cynthia Holcomb Hall, Diarmuid F. O’Scannlain,
          and Richard A. Paez, Circuit Judges.

             Opinion by Judge O’Scannlain
             SPRINT PCS v. LA CAÑADA FLINTRIDGE            735

                         COUNSEL

John J. Flynn, III, Nossaman, Guthner, Knox & Elliot, LLP,
Irvine, California, argued the cause for the appellant. Gregory
W. Sanders and Michael W. Shonafelt were on the briefs.
736           SPRINT PCS v. LA CAÑADA FLINTRIDGE
Scott J. Grossberg, Cihigoyenetche, Grossberg & Clouse,
Rancho Cucamonga, California, argued the cause for the
appellees. Richard R. Clouse, Amy von Kelsch-Berk, and
Angelica Arias were on the brief.

                           OPINION

O’SCANNLAIN, Circuit Judge:

   This case requires us to determine whether a city can, con-
sistent with California and federal law, deny a telecommuni-
cations company a permit to construct and to install a wireless
antenna based on aesthetic considerations.

                                I

   Sprint PCS is a wireless telecommunications company
seeking to install two wireless telecommunications facilities
in the city of La Cañada Flintridge (“the City”). The City
denied Sprint’s applications to install these wireless facilities,
finding that they would obstruct the rights-of-way and would
have a deleterious aesthetic impact on the neighborhood. The
City rejected Sprint’s applications pursuant to its local wire-
less ordinance, which authorized the City to deny permit
applications, inter alia, on aesthetic grounds. After the City
denied two of Sprint’s five applications, Sprint brought two
actions against the City—one for each permit application
denied—alleging violations of the federal Telecommunica-
tions Act of 1996, Pub. L. No. 104-104, 110 Stat. 56 (codified
as amended in scattered sections of 15, 18, & 47 U.S.C.)
(“Telecom Act”), and the California Public Utilities Code,
Cal. Pub. Util. Code §§ 7901, 7901.1 (“Utilities Code”). The
district court determined that there was not substantial evi-
dence supporting the City’s finding that Sprint’s facilities
would obstruct the rights-of-way. The district court, however,
found that there was substantial evidence supporting the aes-
             SPRINT PCS v. LA CAÑADA FLINTRIDGE               737
thetic rationale for denying the permit. Sprint appeals from
the grant of summary judgment in favor of the City upholding
the permit denials based on aesthetic impact, arguing the deni-
als violate state law.

                               II

   In October 2001, the City enacted an ordinance setting
forth four criteria that applicants for a Public Right-of-Way
Above Ground Construction permit (“permit”) must satisfy.
According to Ordinance 324, “An Urgency Ordinance of the
City Council of the City of La Cañada Flintridge Adopting a
Moratorium on the Issuance of Any Demolition, Grading,
Utility, Excavation or Other Permits Relating to Above-
Ground Structures Along City Public Rights-of-Way”
(“Ordinance 324”), those criteria are:

    (1)   The proposed above-ground structure does not
          obstruct access for pedestrians, nor block view
          [sic] of vehicles, pedestrians or bicyclists;

    (2)   The proposed above-ground structure is com-
          patible with existing above-ground structures
          along the public right-of-way, and does not
          result in an over-concentration of above-ground
          structures along the public right-of-way;

    (3)   The proposed above-ground structure preserves
          the existing character of the surrounding neigh-
          borhood, and minimizes public views of the
          above-ground structure; and

    (4)   The proposed above-ground structure does not
          result in a negative aesthetic impact on the pub-
          lic right-of-way or the surrounding neighbor-
          hood.

Criteria (2), (3) and (4) are aesthetic, or non-functional.
738          SPRINT PCS v. LA CAÑADA FLINTRIDGE
   Sprint applied for five permits shortly after the City enacted
its Ordinance. The City granted two of the permit applica-
tions, Sprint withdrew one application, and the City rejected
two of the applications which are the bases for Sprint’s com-
plaint.

   Sprint intended to construct a wireless facility along Figue-
roa Street, and applied for a permit in December, 2001, and
for a second wireless telecommunications facility along
Descanso Drive in July, 2002. After a variety of appeals
through the City Public Works and Traffic Commission,
Sprint ended up in the City Council, which held hearings and
denied Sprint’s applications. As to the Figueroa Street appli-
cation, the City Council based its denial on findings that: (1)
the facility “will significantly damage the existing character
of the neighborhood and result in a negative aesthetic impact
on the right-of-way”; (2) “[t]he proposed Project will change
the character of the neighborhood and will result in a negative
aesthetic impact on the public right-of-way”; (3) “[t]he anten-
nas will negatively impact the residence’s views and the char-
acter of the neighborhood”; and (4) the antennas are
“unsightly.” The City also found that the proposed facility
would obstruct access to the public right-of-way, but the dis-
trict court found that this ground was not supported by sub-
stantial evidence—a finding that the City does not challenge.

   As for the Descanso Drive telecommunications facility
installation permit, the City Council found that the proposed
facility did not satisfy criteria (2), (3), and (4) of the City
Moratorium. Specifically, the City Council found that: (1) the
facility did not meet the second criterion because the above-
ground structures would result in “over-concentration” of the
structures; (2) the facility did not meet the third criterion,
because the facility is “out-of-character for the neighbor-
hood”; and (3) the facility did not meet the fourth criterion
because the facility would “draw attention in a negative aes-
thetic manner along the street.”
             SPRINT PCS v. LA CAÑADA FLINTRIDGE            739
   The district court found that the City’s findings as to the
second criterion of the Ordinance were not supported by sub-
stantial evidence, but that the findings as to the third and
fourth aesthetic criteria were supported by substantial evi-
dence. The City does not challenge the district court’s ruling
as to the second criterion.

   The district court ordered the actions for the Figueroa
Street facility and the Descanso Drive facility consolidated.
Ruling on cross-motions for summary judgment, the district
court ruled against Sprint on two of its critical claims. The
parties thereafter consented to dismissal of Sprint’s remaining
claims, and the district court entered summary judgment for
the City.

                              III

                              A

   The interpretation of the statutory provisions of the Tele-
com Act and the Utilities Code presents questions of law
which receive de novo review. Carson Harbor Vill., Ltd. v.
Unocal Corp., 270 F.3d 863, 870 (9th Cir. 2001) (en banc).
However, if this Court reviews the evidence relied upon by
the City in denying the permits, the City must satisfy the sub-
stantial evidence standard. See 47 U.S.C. § 332(c)(7)(B)(iii).
We have described the substantial evidence standard as “def-
erential.” See MetroPCS, Inc. v. City & County of San Fran-
cisco, 400 F.3d 715, 725 (9th Cir. 2005); see also id. at 723
(holding that “substantial evidence” implies “the traditional
standard used for judicial review of agency decisions”) (inter-
nal quotation omitted).

                              B

                              1

  [1] The Telecom Act requires that the City’s permit denials
be supported by substantial evidence. Specifically, 47 U.S.C.
740          SPRINT PCS v. LA CAÑADA FLINTRIDGE
§ 332(c)(7)(B)(iii) states that “[a]ny decision by a State or
local government or instrumentality thereof to deny a request
to place, construct, or modify personal wireless service facili-
ties shall be in writing and supported by substantial evidence
contained in a written record.”

   [2] The interpretation of “substantial evidence” in the con-
text of the Telecom Act was the focus of extended analysis in
MetroPCS, which held that “the substantial evidence inquiry
does not require incorporation of the substantive federal stan-
dards imposed by the [Telecom Act].” 400 F.3d at 723.
Rather, courts should consider whether the denial is based on
“substantial evidence in the context of applicable state and
local law.” Id. at 724. Consequently, the Telecom Act “ ‘does
not affect or encroach upon the substantive standards to be
applied under established principles of state and local law.’ ”
Id. (quoting Cellular Tel. Co. v. Town of Oyster Bay, 166 F.3d
490, 494 (2d Cir. 1999); see also id. (concluding that the sub-
stantial evidence standard “does not create a substantive fed-
eral limitation upon local land use regulatory power”))
(internal quotation omitted). MetroPCS accords with the deci-
sions of other circuits in this respect. See id. at 723 (noting
that “there appears to be universal agreement among the cir-
cuits as to the substantive content of [the substantial evidence]
requirement”); see, e.g., Preferred Sites, LLC v. Troup
County, 296 F.3d 1210, 1219 (11th Cir. 2002); Oyster Bay,
166 F.3d at 494.

   The substantial evidence standard is “essentially ‘deferen-
tial,’ ” and courts may not “ ‘engage in [their] own fact-
finding nor supplant [a city’s] reasonable determinations.’ ”
MetroPCS, 400 F.3d at 725 (quoting Oyster Bay, 166 F.3d at
494) (first alteration in original). Substantial evidence implies
“less than a preponderance, but more than a scintilla of evi-
dence.” MetroPCS, 400 F.3d at 725 (internal quotation omit-
ted).

   [3] Thus, to be valid, the grounds for denial must receive
at least some weight under state law. If not, the denial is
              SPRINT PCS v. LA CAÑADA FLINTRIDGE              741
deemed “invalid even before the application of the [Telecom
Act’s] federal standards.” MetroPCS, 400 F.3d at 724.

                                2

  The relevant state law includes Utilities Code § 7901,
which states:

    Telegraph or telephone corporations may construct
    lines of telegraph or telephone lines along and upon
    any public road or highway, along or across any of
    the waters or lands within this State, and may erect
    poles, posts, piers, or abutments for supporting the
    insulators, wires, and other necessary fixtures of
    their lines, in such manner and at such points as not
    to incommode the public use of the road or highway
    or interrupt the navigation of the waters.

Cal. Pub. Util. Code § 7901 (2005).

   The California Supreme Court described the effect of Cali-
fornia Civil Code (“Civil Code”) § 536, the predecessor stat-
ute to § 7901, on local regulations: “[T]he right and obligation
to construct and maintain telephone lines has become a matter
of state concern. For this reason, the city cannot today exclude
telephone lines from the streets upon the theory that ‘it is a
municipal affair.’ ” Pac. Tel. & Tel. Co. v. City & County of
San Francisco, 336 P.3d 514, 519 (1959). Similarly, the
authority to proscribe regulations under Civil Code § 536 on
the basis of “incommode” was narrow. See Pacific Tel. & Tel.
Co. v. City & County of San Francisco, 17 Cal. Rptr. 687, 694
(Cal. Ct. App. 1961) (interpreting “incommode” to mean the
prevention of “unreasonable obstruction of the public use”).

   In 1991, the California state legislature adopted
§ 7901.1(a), which reads in relevant part: It is the intent of the
Legislature, consistent with Section 7901, that municipalities
shall have the right to exercise reasonable control as to the
742          SPRINT PCS v. LA CAÑADA FLINTRIDGE
time, place, and manner in which roads, highways, and water-
ways are accessed. Cal. Pub. Util. Code § 7901.1(a) (2005).

                               3

   Article XI, § 7 of the California Constitution states that a
“county or city may make and enforce within its limits all
local, police, sanitary, and other ordinances and regulations
not in conflict with general laws.” A local law that “dupli-
cates, contradicts, or enters an area fully occupied by general
law, either expressly or by legislative implication” will be
preempted by the state law. Fireman’s Fund Ins. Co. v. City
of Lodi, 302 F.3d 928, 941 (9th Cir. 2002) (internal quotation
omitted); Tily B., Inc. v. City of Newport Beach, 81 Cal. Rptr.
2d 6, 18 (Cal. Ct. App. 1998) (In California, “[s]tate law pre-
empts local legislation if an ordinance duplicates, contradicts,
or enters an area fully occupied by the general laws, either
expressly or by implication.”). Therefore, if Utilities Code
§§ 7901 and 7901.1 apply, they may preempt the local ordi-
nance.

   [4] Section 7901 gives telephone companies broad author-
ity to construct telephone lines and other fixtures “in such
manner and at such points as not to incommode the public use
of the road or highway or interrupt the navigation of the
waters.” By the plain text of the statute, the only substantive
restriction on telephone companies is that they may not “in-
commode the public use” of roads. It is possible that
extremely severe aesthetic objections could conceivably
incommode the use of the roads. See 7 The Oxford English
Dictionary 806 (Oxford University Press, 2d ed., 1989)
(defining “incommode” as “[t]o subject to inconvenience or
discomfort; to trouble, annoy, molest, embarrass, inconve-
nience”). An extraordinarily unattractive wireless antenna
might, for example, cause such visual blight that motorists are
uncomfortable using the roads. Counsel for the City posited,
during oral argument, that an unattractive wireless structure
could cause “discomfort.”
                SPRINT PCS v. LA CAÑADA FLINTRIDGE                    743
   [5] However, the most natural reading of § 7901 grants
broad authority to telephone companies to install necessary
wires and fixtures, so long as they do not interfere with public
use of the roads. The text focuses on the function of the road
—its “use,” not its enjoyment. Based solely on § 7901, it is
unlikely that local authorities could deny permits based on
aesthetics without an independent justification rooted in inter-
ference with the function of the road.

  [6] Section 7901, however, has been modified by § 7901.1.
Two provisions determine the extent of local regulatory
authority under § 7901.1: first, the breadth of “time, place,
and manner,” and second, the meaning of “are accessed.”

   The phrase “time, place, and manner” seems to expand
local regulatory authority beyond the “incommode” standard
in the earlier § 7901. Despite some legislative history, of
which the district court took judicial notice, that portrays
§ 7901.1 as merely “clarify[ing]” the law, the plain text indi-
cates that this provision expands municipal authority.1 April
24, 1995, Statement for SB 621 to Cal. Sen. Energy, Utilities
and Communications Comm. (S. 1994-95 Reg. Sess.). Specif-
ically, “incommode” refers to the disruption of the reasonable
use of the road. While the authority to restrict building based
on “time, place, and manner” gives cities more authority to
determine what constitutes a reasonable use of the road, this
language does not seem to enhance greatly the City’s regula-
tory latitude—certainly not to the extent necessary to engage
in aesthetic regulation.

   [7] A regulation of appearance could conceivably be con-
sidered a regulation of the “manner” in which telephone com-
panies use public roads. However, this seems to stretch the
  1
   Some legislative history accords with this reading as well. See, e.g.,
Analysis of SB 621, Cal. Sen. Rules Comm., Office of Senate Floor Anal-
yses (S. 1994-95 Reg. Sess.) (“This bill is intended to bolster the cities’
abilities with regard to construction management.” (emphasis added)).
744          SPRINT PCS v. LA CAÑADA FLINTRIDGE
word “manner,” which, coupled with “time” and “place,” can-
not be read so broadly. More importantly, the City’s reading
is illogical when coupled with the “are accessed” language
that follows. Section 7901.1 only gives cities the authority to
regulate the manner is which roads “are accessed,” not the
authority to regulate the manner in which telephone compa-
nies affect the road’s appearance. The better reading of “time,
place, and manner” does not expand the City’s authority far
enough to include aesthetic regulation.

   [8] Further, the “are accessed” language restricts local
authority: cities may only regulate the way in which roads
“are accessed,” not the way they appear. As with § 7901, the
regulatory power is functional, and does not extend to aesthet-
ics. In sum, under Utilities Code §§ 7901 and 7901.1, local
regulators retain no authority to deny permits based on aes-
thetics.

   The City, however, cites cases holding that aesthetics can
properly be considered substantial evidence. See, e.g.,
Omnipoint Corp. v. Zoning Hearing Bd. of Pine Grove Twp.,
181 F.3d 403, 409 (3d Cir. 1999) (noting that aesthetic con-
siderations, as opposed to alleged health effects, are proper
evidence under 47 U.S.C. § 332(c)(7)(B)(iii)); Aegerter v.
City of Delafield, 174 F.3d 886, 891 (7th Cir. 1999) (“Nothing
in the Telecommunications Act forbids local authorities from
applying general and nondiscriminatory standards derived
from their zoning codes, and we note that aesthetic harmony
is a prominent goal underlying almost every such code.”).
However, whether aesthetic evidence can be a used to support
a permit denial in the abstract is not at issue—the issue is sim-
ply whether a city can consider such evidence consistent with
California law. Under Utilities Code §§ 7901 and 7901.1, they
cannot.

                               4

   Section 332(c)(7)(A) of the Telecom Act provides that
“[e]xcept as provided in this paragraph, nothing in this Chap-
              SPRINT PCS v. LA CAÑADA FLINTRIDGE               745
ter shall limit or affect the authority of a State or local govern-
ment or instrumentality thereof over decisions regarding the
placement, construction, and modification of personal wire-
less service facilities.” 47 U.S.C. § 332(c)(7)(A).

   [9] If the local ordinance is valid under the Telecom Act,
despite being invalid under state law, see supra III.B.3, then
the Telecom Act effectively provides a measure of sovereign
authority to cities, which their own state constitutions and
statutes deny them. The language of subsection (c)(7)(A),
however, does not imply that local law should be valid to the
exclusion of state law, but merely that local law itself may not
be ignored. Thus, if the local law itself is invalid—for exam-
ple, because it conflicts with state law—then subsection
(c)(7)(A) will not save it. If the Telecom Act intended to grant
such authority to local laws—even those that are preempted
by state laws—it might have preserved the authority of “State
and local government[s],” rather than the disjunctive.

   Further, the City argues that the plain language of the
statute—preserving the authority of “State or local
government”—mandates City autonomy. Under this reading
of the statutory text, the Telecom Act does not limit state rules
or local rules. Thus, since there is a local rule, whether or not
valid, the Telecom Act must recognize it, goes the argument.

   We are not persuaded. The disjunctive language implies
that state or local authority is preserved, not that both are nec-
essarily preserved regardless of other constraints. Further,
even if we followed the City’s argument and held that the lan-
guage of subsection (c)(7)(A) preserves local authority, there
is no local authority here in the first place—state law has
already preempted local authority. The “state or local govern-
ment” language, in context, affirms preexisting authority—
“nothing in this chapter shall limit or affect the authority”—it
is not a positive grant of authority where none rightly exists.
The City’s reading ignores the plain statutory mandate that
“nothing . . . shall . . . affect the authority,” since the Telecom
746           SPRINT PCS v. LA CAÑADA FLINTRIDGE
Act would affect local authority by expanding local regulatory
power.

   Given that the plain language of the statute is clear, it is not
necessary to address public policy arguments. In any event,
public policy also supports this interpretation. The City’s
proffered interpretation uses the Telecom Act to grant broad
regulatory authority to cities or municipalities that would oth-
erwise be constrained by state law. In other words, the City’s
reading of the “State or local government” language would set
cities free to regulate to the extent of their traditional police
power. This result would be antithetical to the purpose of the
Telecom Act, whose goal is “to promote competition and
higher quality in American telecommunications services and
to ‘encourage the rapid deployment of new telecommunica-
tions technologies.’ ” City of Rancho Palos Verdes v. Abrams,
125 S. Ct. 1453, 1455 (2005) (quoting the Telecom Act).

                                C

   [10] The Telecom Act requires permit denials be supported
by substantial evidence. 47 U.S.C. § 332(c)(7)(B)(iii) (2005).
Because the City overstepped its regulatory authority under
state law, its wireless ordinance is invalid, and no evidence
supports the City’s permit denial. The district court’s conclu-
sion that substantial evidence supported the City’s permit
denials must be reversed.

                                IV

   In light of our disposition of this case, we need not reach
Sprint’s additional claims that the city discriminated against
it in violation of 47 U.S.C. § 332(c)(7)(B)(i)(I).

  REVERSED.