Appeals Court Sends Ownership Cap Issue Back to FCC
April 4, 2002
In the case of Fox Television Stations Inc. v. FCC, the U.S. Court of Appeals for the District of Columbia Circuit has remanded the rules limiting the number of television stations that broadcasters can own nationally back to the FCC for reconsideration, deciding that the current rules of a 35-percent national television ownership cap are "arbitrary."
Baltimore-based Sinclair Broadcast Group argued against the rules, stating that they were arbitrary and unconstitutional. The president of Sinclair stated after the decision that the rules were "outdated and anticompetitive in today's media market."
However, the Network Affiliated Stations Alliance and the National Association of Broadcasters immediately released a letter stating that the court did not decide the 35-percent rule was unconstitutional, nor that diversity and localism concerns could not be used to justify the ownership limit.
According to NASA and NAB, the decision was against how the FCC reviewed and justified the ownership cap, not the cap itself. The court stated that it did not invalidate the cap because "the probability that the Commission will be able to justify the [35-percent] cap is sufficiently high." The two associations issued the letter because they were concerned with interpretations of the case that said it would open "floodgates to mergers and consolidation in the media industry."