United States v. Southwestern Cable Company

Community antenna television (CATV) systems receive television broadcast signals, amplify them, transmit them by cable or microwave, and distribute them by wire to their subscribers' receivers. In 1959 the Federal Communications Commission (FCC), although it found CATV "related to interstate transmission," stated that it "did not intend to regulate CATV," and that it preferred to recommend legislation which would impose specified requirements upon CATV systems. Such legislation was proposed but not enacted. The CATV industry has had an explosive growth, has increased substantially the signal transmission range, and has been bringing signals from selected broadcasting areas into metropolitan centers. Since 1960 the FCC has gradually asserted jurisdiction over CATV, and in 1965, following hearings, the FCC issued revised rules, applicable to cable and microwave CATV systems, to govern the carriage of local signals and the nonduplication of local programming. The FCC banned CATV transmission of distant signals into the 100 largest television markets (except for such service as existed on February 15, 1966, or unless the FCC found the service would "be consistent with the public interest"), and created summary procedures for applications for separate or additional relief. Petitioner Midwest Television applied for special relief, alleging that respondents' CATV systems transmitted signals from Los Angeles into the San Diego area, adversely affecting Midwest's San Diego station. The FCC, after considering the petition and responsive pleadings, restricted the expansion of respondents' service in areas in which they had not operated on February 15, 1966, pending hearings on the merits of Midwest's complaint. The Court of Appeals held that the FCC lacked authority under the Communications Act of 1934 to issue such order.

Held:


 * 1. The FCC has authority under the Act to regulate CATV systems. Pp. 167-178.


 * (a) The FCC has broad authority over "all interstate and foreign communications by wire or radio," which includes CATV systems as they are encompassed within the term "communication by wire or radio," and there is no doubt they are engaged in interstate communication. Pp. 167-169.


 * (b) The FCC's requests for legislation have no significant bearing on the resolution of this issue. Pp. 169-171.


 * (c) The FCC has reasonably found that the successful performance of its responsibilities for the orderly development of local television broadcasting demands prompt and efficacious regulation of CATV, and in the absence of compelling evidence that Congress intended otherwise, administrative action imperative for an agency's ultimate purposes should not be prohibited. Permian Basin Area Rate Cases, 390 U.S. 747, 780. Pp. 172-178.


 * (d) The FCC's authority recognized here is restricted to that reasonably ancillary to the effective performance of its responsibilities for the regulation of television broadcasting. P. 178.


 * 2. The FCC had authority to issue the prohibitory order in this case. Pp. 178-181.


 * (a) The order was designed merely to preserve the situation as of the time of issuance, and it was not, in form or function, a cease-and-desist order that must issue under § 312 of the Act, and which requires a hearing or a waiver of the right thereto. Pp. 179-180.


 * (b) The FCC has authority to issue "such orders... as may be necessary in the execution of its functions," and this order for interim relief pending hearings to determine appropriate action, did not exceed or abuse its authority under the Act. Pp. 180-181.

378 F. 2d 118, reversed and remanded.

Henry Geller argued the cause for the United States et al. With him on the briefs were Solicitor General Griswold, Assistant Attorney General Turner, Francis X. Beytagh, Jr., Howard E. Shapiro, and Daniel R. Ohlbaum.

Ernest W. Jennes argued the cause for petitioners in No. 428. With him on the briefs was Charles A. Miller.

Arthur Scheiner argued the cause for respondent Southwestern Cable Co. in both cases. With him on the brief were Morton H. Wilner and ''Harold F. Reis. Robert L. Heald'' argued the cause for respondents Mission Cable TV, Inc., et al. in both cases. With him on the brief were Frank U. Fletcher, Edward F. Kenehan, and James P. Riley.

Michael Finkelstein filed a brief for the All-Channel Television Society, as amicus curiae, urging reversal.

Briefs of amici curiae, urging affirmance, were filed by Robert A. Marmet, Thomas W. Wilson, John D. Matthews, and Robert H. Young for the Alice Cable Television Corp. et al., and by Wayne W. Owen, Harry M. Plotkin, and George H. Shapiro for the Black Hills Video Corp. et al.