TV Station Consolidation OK, Say Supremes

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In a unanimous decision, the Supreme Court voted to uphold a decision by the FCC to deregulate ownership of television broadcast stations. The Commission proposed the rule change in 2017 under Trump-appointed FCC chair Ajit Pai. The changes included an elimination of a rule that barred common ownership of stations in a market if the result would be fewer than eight independently owned stations, and another rule forbidding cross-ownership of a station and newspaper in the same market. The Commission also relaxed rules relating to joint advertising sales agreements between stations.

The Third Circuit overturned the rules change on the grounds that the Commission “did not adequately consider the effect its sweeping rule changes will have on ownership of broadcast media by women and racial minorities.” This was the same argument pursued by the public interest parties at the Supreme Court. They did not presume to dictate policy to the FCC, but only to show that it had failed to give serious consideration to the data in order to reach a balanced judgement.

The decision from Justice Kavanaugh swept this argument aside. Based on the record before it, he wrote, the agency “reasonably concluded that the three ownership rules at issue were no longer necessary to serve the agency’s public interest goals of competition, localism and viewpoint diversity….” Although there were gaps in the data on which it relied, the FCC acknowledged the gaps and was not obligated to dig further in order to avoid falling afoul of the “arbitrary and capricious” standard required to overturn agency rulings under the Administrative Procedure Act.

Proponents of the changes argued that they were long overdue. Local TV and newspapers have long been facing stiff headwinds, first from cable competition and now from hypertargeted digital advertising on Google and Facebook. The mom-and-pop broadcast outlets and local station groups would be doomed unless they can join deep-pocketed national station groups.

The argument for continued diversity has its appeal, however, when one looks at Sinclair Broadcasting, a large station group that made headlines for forcing the news broadcasts of its stations to run right wing segments. Even short of a conservative takeover of local news, widespread consolidation could result in homogenization and the loss of independent voices.

In light of these arguments, the unanimity of the Supreme Court decision may seem surprising. It’s plausible to suppose that the Court’s liberals are playing the long game here to ensure the continued viability of Chevron deference. This was the doctrine established in Chevron U.S.A. Inc. v. Natural Resources Defense Council, 467 U.S. 384 (1984) that federal courts should defer to an agency’s interpretation of a statute if the statute is ambiguous and the agency’s interpretation is reasonable.

The Court has been steadily narrowing the reach of Chevron, and conservative commentators and some of the justices have called for it to be overruled. This has raised concerns on the left that judges will substitute their judgement for that of administrative agencies and accomplish deregulation by judicial means. By standing behind the FCC in this case, even though they may differ in the substantive result, the Court’s liberals have buttressed the principle of agency independence.

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