Action for Children v. FCC

• Court: Court of Appeals for the First Circuit
• Decided: July 22, 1993
• Docket: 92-2225
• Status: Published

Opinion

USCA1 Opinion

UNITED STATES COURT OF APPEALS
                            UNITED STATES COURT OF APPEALS
                                FOR THE FIRST CIRCUIT
                                FOR THE FIRST CIRCUIT
                                 ____________________

        No. 92-2225

                          ACTION FOR CHILDREN'S TELEVISION,

                                     Petitioner,

                                          v.

                      FEDERAL COMMUNICATIONS COMMISSION, ET AL.,

                                     Respondents.

                                 ____________________

                           COALITION ON SMOKING OR HEALTH,

                                     Intervenor.
                                 ____________________

                          ON PETITION FOR REVIEW OF AN ORDER
                       OF THE FEDERAL COMMUNICATIONS COMMISSION

                                 ____________________

                                        Before

                                Boudin, Circuit Judge,
                                        _____________
                           Campbell, Senior Circuit Judge,
                                     ____________________
                              and Stahl, Circuit Judge.
                                         _____________

                                 ____________________

Sharon  L. Webber with  whom Angela  J. Campbell  and Henry Geller
            _________________            ___________________      ____________
        were on brief for petitioner and intervenor.
            C.  Grey  Pash, Jr.,  Counsel, Federal  Communications Commission,
            __________________
        with whom Renee Licht,  Acting General Counsel, Federal Communications
                  ___________
        Commission,  Daniel M. Armstrong,  Associate General  Counsel, Federal
                     ___________________
        Communications  Commission,  Robert  B.  Nicholson,  Attorney,  United
                                     _____________________
        States Department of  Justice, and Marion L.  Jetton, Attorney, United
                                           _________________
        States Department of Justice, were on brief for respondents.

____________________

                                    July 22, 1993
                                 ____________________

BOUDIN, Circuit Judge.  Action for Children's Television
                         _____________

            ("ACT") petitions for  review of the decision of  the Federal

            Communications Commission denying ACT's request that the  FCC

            take action to combat "hidden commercials" on television that

            promote smoking.  We deny the petition. 

                 In  1966, acting on a private  citizen petition, the FCC

            required broadcasters, under the  "fairness doctrine," to air

            anti-smoking  messages  in  response  to   advertisements  by

            cigarette companies.  See Banzhaf v. FCC, 405 F.2d 1082 (D.C.
                                  ___ ______________

            Cir. 1968), cert.  denied, 396  U.S. 842 (1969).1   In  1969,
                        _____  ______

            Congress enacted the  Cigarette Labeling and  Advertising Act

            ("the  Cigarette Act"),  15  U.S.C.     1331  et seq.,  which
                                                          __ ___

            pertinently provided that "it  shall be unlawful to advertise

            cigarettes  or little  cigars over  any medium  of electronic

            communication  subject  to the  jurisdiction  of  the Federal

            Communications Commission."  15 U.S.C.   1335.  

                 In 1970,  an organization  called Action on  Smoking and

            Health ("ASH") petitioned the  FCC to require broadcasters to

            continue   to  air   anti-smoking   messages,   despite   the

            prohibition  contained in  the Cigarette  Act, partly  on the

            ground  that   the  cigarette  industry  was   using  "hidden

____________________

                 1The   fairness  doctrine  was  an  FCC  rule  requiring
            broadcasters  to  air  contrasting views  when  controversial
            issues were addressed.  See Red Lion Broadcasting Co. v. FCC,
                                    ___ ________________________________
            395  U.S.  367  (1968).    The  rule  was  abandoned  by  the
            Commission in  August 1987.   See Syracuse  Peace Council  v.
                                          ___ ___________________________
            FCC,  867 F.2d 654 (D.C.  Cir. 1989), cert.  denied, 493 U.S.
            ___                                   _____  ______
            1019 (1990).  

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commercials" to circumvent  the Act.   The quoted phrase,  as

            ACT  uses  it, refers  to  cigarette  company sponsorship  of

            sporting events during which the cigarette brand name or logo

            is displayed on signs or banners, which in turn are broadcast

            during  televised  coverage  of  these events,  such  as  the

            Marlboro  Grand Prix auto race and  the Virginia Slims tennis

            tournament.  The FCC denied the ASH request.  The agency said

            that  it found  no  hard  evidence  of  the  use  of  "hidden

            commercials"  by the cigarette  industry, and  concluded that

            "if such  abuses do occur .  . . , the  appropriate action in

            such an  eventuality would  be to secure  full and  effective

            compliance with  the 1969 law,  and not  to deal  with it  by

            offsetting   anti-smoking   messages."       Formulation   of
                                                         ________________

            Appropriate Further Regulatory Policies  Concerning Cigarette
            _____________________________________________________________

            Advertising and  Antismoking Presentations, 27  F.C.C.2d 453,
            __________________________________________

            458 n.5 (1970). 

                 In 1990, ACT filed with the FCC the petition at issue in

            this  case.    ACT claimed  that  there  is  now indisputable

            evidence  that   the  cigarette  industry  is  using  "hidden

            commercials."   According to  the petition the  Department of

            Justice has never initiated any enforcement proceedings under

            the  Cigarette Act  and therefore  appears to  have concluded

            that hidden commercials do  not violate the statute, creating

            the need  for FCC action.   ACT requested the FCC  to issue a

            "declaratory  ruling" requiring licensees to air anti-smoking

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messages to offset the harm caused by the hidden advertising.

            Because the fairness doctrine was no longer in existence, ACT

            relied on  the "public  interest standard"  set forth  in the

            Communications  Act  of 1934  to  govern  the regulation  and

            licensing of broadcasters.   47 U.S.C.   303; see also id.   
                                                          ___ ____ __

            307(a), 309(a), 310(d). 

                 ACT's petition  was denied  by the Commission  in August

            1992.  In re Petition For Declaratory  Relief Regarding Anti-
                   ______________________________________________________

            Smoking Messages Filed by Action for Children's Television, 7
            __________________________________________________________

            F.C.C.R.  5466 (1992).  The FCC said that this issue had been

            raised and resolved  in the 1970 proceedings brought  by ASH,

            and  that ACT  had  presented nothing  new.   The  Commission

            stated that it "continue[d] to believe that the Cigarette Act

            itself is  properly looked  to as  defining both  the conduct

            that is prohibited  [with respect  to cigarette  advertising]

            and the  remedies that are available  to redress violations."

            Id.  It is undisputed that the Department of Justice, not the
            __

            FCC, is exclusively charged  with enforcing the provisions of

            the Cigarette Act.  See 15 U.S.C.   1339.   ACT now petitions
                                ___

            this court for review.2 

____________________

                 2It  appears that  ACT, which  had been  a Massachusetts
            corporation, was formally dissolved  as of December 31, 1992,
            after its petition was filed  in this court.  By  letter, the
            FCC says that ACT's  dissolution "raises the question whether
            it  continues to be a  party aggrieved" by  the FCC's action.
            In response ACT  points out that  under Massachusetts law,  a
            dissolved corporation  "shall nevertheless be continued  as a
            body corporate  for three years  . .   . for  the purpose  of
            prosecuting or defending suits by or against it."  Mass. G.L.

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An  agency's decision  not to  undertake a  new project,
                                        ___

            regulation, or enforcement action  has been treated by courts

            as  a somewhat  unusual  animal in  the  menagerie of  agency

            actions  that may  be  presented  for  judicial review.    Of

            course, where there  is a statutory obligation  on the agency

            to take  a relatively specific  action, a court  might easily

            conclude that it  had both a standard to  apply to a shirking

            agency  and  a duty  to enforce  the  standard.   More often,

            agencies  make  decisions  not  to  act  under  rather  broad

            statutory standards  or, as is typically  true of enforcement

            actions, under a general mandate to enforce the law. 

                 In such cases courts have been reluctant to second-guess

            agencies  when   they  decline  to  act.     In  some  areas,

            paralleling  prosecutorial decisions not  to seek indictment,

            courts are  reluctant to intervene  at all;  in others,  they

            have  recognized  great  discretion  in the  agency  when  it

            declines to act and required only minimal justification.  See
                                                                      ___

            Heckler v.  Chaney, 470  U.S. 821  (1985);  United Church  of
            _______     ______                          _________________

            Christ v. FCC, 911 F.2d 813 (D.C. Cir. 1990).  As the circuit
            ______    ___

            most  experienced  in these  matters  said  in another  case,

____________________

            ch. 155,   51; see also City Communications, Inc. v. Detroit,
                           ________ ____________________________________
            888  F.2d 1081,  1086-87 (6th  Cir. 1989)  (looking to  state
            corporate    law   to   determine   standing   of   dissolved
            corporation).    Given the  statute  coupled  with the  FCC's
            posture on the issue, we think that denial of the petition on
            the merits is the proper course.

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Natural  Resources Defense  Council,  Inc. v.  SEC, 606  F.2d
            __________________________________________________

            1031, 1046 (D.C. Cir. 1979) (citations omitted):

                 An agency's discretionary  decision not to regulate
                                                     ___
                 a  given activity  is  inevitably  based, in  large
                 measure, on factors  not inherently susceptible  to
                 judicial  resolution  -- e.g.,  internal management
                                          ____
                 considerations   as   to   budget  and   personnel;
                 evaluations  of its  own  competence;  weighing  of
                 competing   policies   within  a   broad  statutory
                 framework.  

                 This court  has made  similar  observations, see,  e.g.,
                                                              ___   ____

            Ward v. Skinner,  943 F.2d 157, 161 (1st Cir.  1991), and the
            _______________

            standard of  deference thus adopted  controls this case.   We

            need not conclude that the FCC's refusal to undertake a rule-

            making  is  automatically  immune  from judicial  review,  no

            matter  how  egregious  the  occasion or  how  troubling  the

            agency's explanation.   Here, the FCC's  explanation is quite

            rational.   In sum, the agency ruled that Congress provided a

            general  ban on television cigarette advertising as part of a

            "comprehensive" federal  program, 15  U.S.C.   1331,  and, if

            the ban  is being  infringed  at the  margins, Department  of

            Justice  enforcement is  the  preferable course.   Given  the

            FCC's broad  discretion  as  to  how to  deploy  its  limited

            resources, this is an adequate explanation.

                 ACT  says that the  explanation is faulty  to the extent

            that  hidden commercials are a "loophole" in the law and thus

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beyond  the reach  of the  Department of  Justice.3   Even if

            this  were  so,   it  would  not  make  the   FCC's  position

            unreasonable.  Instead, it could rationally leave to Congress

            the  task   of  adjusting  the  balance  it   struck  in  its

            "comprehensive" statute.  Plugging  loopholes might also be a
                                                                ____

            rational goal for  the agency  (we have no  occasion here  to

            consider  preemption arguments);  but  agency  resources  are

            limited and selecting which rational goals to  pursue is part

            of the agency's function.

                 There is  even less to ACT's  alternative criticism that

            the  FCC's decision  in this  case  is inconsistent  with its

            reasoning in its  earlier decision declining to  act on ASH's

            petition.   ACT  argues that  the FCC  there declined  to act

            because it found  a lack of evidence  that hidden commercials

            were a significant problem and, ACT says, it has now provided

            the missing evidence.   But the FCC went on to say in the ASH
                                                                      ___

            case  that, if the problem proved real, the solution would be

            "to secure full and  effective compliance with the 1969  law,

            and not to deal with it by offsetting anti-smoking messages."

            27 F.C.C.2d at 458 n.5.  There is no inconsistency.

                 The petition for review is denied.
                                            ______

____________________

                 3There is in fact some indication that the Department of
            Justice has  taken the  view that hidden  commercials violate
            the  statute  and  has  written to  cigarette  companies  and
            broadcasters  warning them of  its position.   Whether or not
            this is the Department's present view is not material.

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