California Association of the Physically Handicapped, Inc. v. Federal Communications Commission, Metromedia, Inc., Intervenor

778 F.2d 823, 250 U.S. App. D.C. 202, 59 Rad. Reg. 2d (P & F) 710, 1985 U.S. App. LEXIS 24661

• Court: Court of Appeals for the D.C. Circuit
• Decided: December 10, 1985
• Docket: 84-1170
• Status: Published

Opinions

Opinion for the Court filed by Circuit Judge GINSBURG.

Dissenting opinion filed by Circuit Judge WALD.

GINSBURG, Circuit Judge.

The Federal Communications Commission (Commission or FCC), in an order released April 10, 1984,¹ granted the “short form” applications of Metromedia, Inc., to transfer over fifty percent of its stock from public shareholders, none of whom held as much as five percent, to John W. Kluge, Metromedia’s President and Chief Executive Officer, Chairman of the Board of Directors, and twenty-six percent stockholder.² The California Association of the Physically Handicapped, Inc. (CAPH or Association) had filed a petition with the FCC objecting to the transfer and urging the employment of a “long form” application procedure.³ Evidence uncontroverted before the Commission showed that Kluge had exercised de facto control of Metromedia with FCC approval for many years. The Commission held that the shift from de facto to de jure control by Kluge entailed no “substantial change” in ownership or control;⁴ it therefore approved a “short form” application procedure.⁵ CAPH noticed an appeal to this court from the FCC’s rejection of the Association’s petition.

CAPH invoked 47 U.S.C. § 402(b)(6), which authorizes judicial review at the instance of any person “who is aggrieved or whose interests are adversely affected by” a Commission order. Intervenor Metromedia has challenged the Association’s standing to maintain the appeal,⁶ and we would be obliged to consider that threshold matter on our own initiative in any event. See Juidice v. Vail, 430 U.S. 327, 331, 97 S.Ct. 1211, 1215, 51 L.Ed.2d 376 (1977).

Supreme Court precedent instructs that the constitutional components of “standing” to invoke judicial review are three: (1) personal injury (2) fairly traceable to the defendant’s unlawful conduct and (3) likely to be redressed by the requested relief. Valley Forge Christian College v. Americans United for Separation of Church and State, Inc., 454 U.S. 464, 472, 102 S.Ct. 752, 758, 70 L.Ed.2d 700 (1982); see Allen v. Wright, — U.S. -, 104 S.Ct. 3315, 3325, 82 L.Ed.2d 556 (1984). The Association, we rule, has not met the requirement set out second — the causality requirement.⁷ We conclude that the injury alleged by CAPH is not fairly traceable to the challenged FCC action — the Commission’s consent through short form procedure to the transfer of Metromedia stock — and we dismiss the appeal on that account. See Simon v. Eastern Kentucky Welfare Rights Organization, 426 U.S. 26, 38, 41, 96 S.Ct. 1917, 1924, 1925, 48 L.Ed.2d 450 (1976); Von Aulock v. Smith, 720 F.2d 176, 180-81 (D.C.Cir.1983).

CAPH represents persons with physical handicaps. The Association claims injury stemming from Metromedia’s alleged longstanding neglect of its responsibilities to the handicapped public, particularly Metromedia’s failure to take reasonable steps to make television understandable to the hearing impaired and its failure to exert reasonable efforts to hire the handicapped. CAPH’s very account of Metromedia’s past performance, however, reveals the vulnerability of the Association’s present appeal to this court. The injuries recounted by CAPH plainly do not stem from the FCC’s approval of the transfer of ownership to the individual, John W. Kluge, who has in fact controlled Metromedia for many years:

The “standing” requirement is that the challenged action cause the injury. The Association, however, cannot fairly trace its ongoing injury — either in origin or in endurance — to the transfer in question. Instead, CAPH’s real plea is that the transfer will furnish no cure — it will not cause the injury to abate. This will not suffice. Under the test for judicial review that precedent prescribes, the alleged injury— here attributed to Metromedia’s inadequate captioning and hiring efforts — must be fairly traceable to the asserted unlawful conduct of the FCC, i.e., the Commission’s “short form” consent to the Metromedia stock transfer. See Allen v. Wright, 104 S.Ct. at 3328-29; Gilmore v. City of Montgomery, 417 U.S. 556, 566-69, 94 S.Ct. 2416, 2422-24, 41 L.Ed.2d 304 (1974).⁸

Application of the causality component of “standing” is not always clear and certain.⁹ In this case, however, we find no irrationality or unfairness in applying the criterion, for CAPH’s grievance indeed can be aired effectively before both agency and court. Unlike the complainants in such cases as Allen v. Wright, supra, and Simon v. Eastern Kentucky Welfare Rights Organization, supra,¹⁰ CAPH is not remitted to out-of-court prayers for relief for its alleged injury-in-fact.

CAPH claims aggrievement because Metromedia has not fulfilled its public duty to the handicapped in the operation of its television stations. The Association’s complaint is properly and pointedly raised in a license renewal proceeding where, if it is borne out, the Commission could provide effective relief in the form of a refusal to renew the license.¹¹ In the proceeding at hand, by contrast, even if the Commission had denied the transfer application,¹² Metromedia, despite its allegedly bad record, would remain in control of its stations.¹³

In sum, CAPH’s alleged injury occurred before, existed at the time of, and continued unchanged after the challenged Commission action. CAPH, therefore, cannot tenably trace the asserted injury to the FCC’s approval of Metromedia’s transfer application. Rather, the injury CAPH describes traces to the Commission’s willingness to grant and renew licenses for stations that, in CAPH’s judgment, fail sufficiently to serve and hire the handicapped. CAPH, as the FCC has underscored, has standing to challenge licensing and renewal decisions on the basis of the “aggrievement” it asserts here, but it does not have a stake in the transfer proceeding in question of the kind necessary to invoke review by an Article III court.¹⁴

Conclusion

CAPH lacks the injury in fact caused by the action at issue that is required by Article III. See Duke Power Co. v. Carolina Environmental Study Group, 438 U.S. 59, 72, 98 S.Ct. 2620, 2630, 57 L.Ed.2d 596 (1978). We therefore order that the appeal in this case is

Dismissed.

1 . Metromedia, Inc., 98 F.C.C.2d 300 (1984); see also Metromedia, Inc., F.C.C. No. 84-364, 56 R.R.2d 1198 (1984) (denial of petition for reconsideration).

2 . The Communications Act, 47 U.S.C. § 151 et seq. (1982), requires that the FCC follow certain procedures — including the acceptance and consideration of petitions to deny — before approving a transfer unless the transfer "does not involve a substantial change in ownership or control." Id. at § 309(c)(2)(B). The Commission has created a "long form” application procedure, which fulfills the statutory requirements, and a "short form” application procedure, for those transfers that fall within the statutory exception. On applications involving transfers of control, see generally Storer Communications, Inc. v. FCC, 763 F.2d 436 (D.C.Cir.1985).

3 . The Association's petition was joined by Sue Gottfried, acting individually and as a representative of the class of all the deaf and hearing impaired persons within the viewing area of Metromedia’s Los Angeles station KTTV-TV. See Metromedia, Inc., 98 F.C.C.2d 300, 301 (1984).

4 . CAPH raised no question as to the fact of Kluge’s long-term de facto control of Metromedia. Instead, relying upon Metromedia’s alleged disregard of the rights and interests of the handicapped in the course of Kluge’s stewardship, CAPH asked the Commission to refuse permission for completion of the proposed transfer until the FCC acted on the allegations CAPH had raised in petitioning to deny the renewal of Metromedia’s license for KTTV-TV in Los Angeles. See Metromedia, Inc., 98 F.C.C.2d 300, 303-04 (1984). The Commission, prior to the argument of this appeal, had considered and ruled on the merits of the contentions CAPH indeed did air in license renewal proceedings. See infra note 11. CAPH, it appears, was positioned to seek judicial review of that adverse FCC determination.

5 . The form was "short” only in comparative terms; Metromedia’s submissions ran over 600 pages. See Brief for Intervenor Metromedia, Inc. at 5.

6 . Metromedia also challenged CAPH’s standing before the Commission. The FCC reported, but did not rule on, Metromedia’s assertion that "petitioners [Gottfried and CAPH] lack the requisite standing, having failed to show that they would suffer actual injury ... as a result of the ... transfer.” Metromedia, Inc., 98 F.C.C.2d 300, 304 (1984). See also infra note 8.

7 . Differentiating ”[t]he 'fairly traceable' and ‘redressability’ components of the constitutional standing inquiry,” the Supreme Court observed that the causality inquiry "examines the causal connection between the [defendant’s — here, the FCC’s] assertedly unlawful conduct and the alleged injury, whereas the [redressability inquiry] examines the causal connection between the alleged injury and the judicial relief requested.” Allen v. Wright, — U.S. -, 104 S.Ct. 3315, 3326 n. 19, 82 L.Ed.2d 556 (1984). We had earlier made the same distinction. See Von Aulock v. Smith, 720 F.2d 176, 181 (D.C.Cir.1983).

8 . The Article III restrictions under which this court operates do not, of course, apply to the FCC. The Commission may choose to allow persons without Article III "standing” to participate in FCC proceedings, as it did in this case.

9 . Compare, e.g., Allen v. Wright, — U.S. -, 104 S.Ct. 3315, 3328-29, 82 L.Ed.2d 556 (1984), with id. 104 S.Ct. at 3336-41 (1984) (Brennan, J., dissenting). See also Valley Forge Christian College v. Americans United for Separation of Church and State, Inc., 454 U.S. 464, 475, 102 S.Ct. 752, 760, 70 L.Ed.2d 700 (1982) (“concept of 'Art. Ill standing’ has not been defined with complete consistency in all of the various cases decided by this Court”).

10 . In Allen v. Wright, — U.S. -, 104 S.Ct. 3315, 82 L.Ed.2d 556 (1984), parents of black children who were attending public schools in districts undergoing desegregation asserted that the Internal Revenue Service had not fulfilled its obligation to deny tax-exempt status to racially discriminatory private schools, and had thereby diminished their children’s opportunity to receive an education in desegregated public schools. In Simon v. Eastern Kentucky Welfare Rights Organization, 426 U.S. 26, 96 S.Ct. 1917, 48 L.Ed.2d 450 (1976), representatives of low income individuals claimed that a Revenue Ruling allowing favorable tax treatment to hospitals that did not serve indigents to the extent of the hospitals' financial ability diminished the services that would be available to poor persons. In both cases, the Supreme Court held that the plaintiffs lacked standing. In neither case did the plaintiffs have access to another agency or court proceeding to seek cessation of the allegedly illegal conduct.

11 . CAPH and its co-petitioner Gottfried would have standing to invoke judicial review of an FCC decision renewing the license of a Metromedia station in face of objection by petitioners that the station neglected the concerns of the handicapped. The causality requirement would be met because the renewal of the license would regenerate the continuing injury that CAPH’s constituency suffers as a result of the station's alleged practices: without a license renewal, the Metromedia station would be incapable of continuing those practices.

The stock transfer, we add, does not interfere with CAPH's ability to pursue objections to the renewal of Metromedia’s licenses. This is not a case in which the entry of a new operator through the device of a transfer or an assignment results in a situation fairly comparable to a license grant. See, e.g., Citizens Committee to Save WEFM v. FCC, 506 F.2d 246 (D.C.Cir.1974) (en banc) (assignment of license to new licensee who proposed substantial format change, i.e., from classical to contemporary music); Golden West Associates, No. FCC 85-541 (Oct. 11, 1985). Nor does the transfer threaten to moot past-performance-based objections that might be raised in a licensing proceeding. The Commission, recognizing that the transfer effected no alteration in Metromedia’s policies and practices, unequivocally represented that approval of the transfer would in no way prejudice CAPH from challenging license renewal applications for particular Metromedia stations. Metromedia, Inc., 98 F.C.C.2d 300, 307 (1984). Focusing on the availability to CAPH of the standard means of challenging station performance, the Commission found that nothing in the pleadings before it "justifie[d] deviating from [its] usual practice of addressing allegations directed against a specific broadcast station's license renewal application in that context." Id.

Indeed, in the license renewal proceedings for Metromedia’s Los Angeles television station, Gottfried and CAPH in fact raised objections identical to the ones they tendered to the FCC in this case. The Chief of the Video Services Division, on behalf of the Commission, considered and rejected the petitioners’ contentions on the merits and granted the license renewals. See Golden West Television, Inc., mimeo 3155 (March 15, 1985), reprinted in Supplemental Brief for Intervenor Metromedia, Inc., app. at attachment no. 1. The Commission denied petitions for review. See Golden West Television, Inc., F.C.C. No. 85-499 (Sept. 16, 1985), reprinted in Supplemental Brief for Intervenor Metromedia, Inc., app. at attachment no. 3. Petitioners, if they are so inclined, may continue that fray in court.

12 . The dissent observes that the FCC applies the same “public interest” standard in transfer cases as in license cases. See dissent at 830-831. This is true but irrelevant. CAPH would have standing in a license renewal proceeding not because of the public interest standard but because of the practical impact of a license renewal. The transfer here does not have a similar impact, i.e., continuance of the challenged conduct does not hinge on whether or not the transfer is approved. Thus, CAPH’s standing to contest the renewal of a license hardly qualifies it to challenge the transfer in question.

13 . The dissent argues that the FCC’s refusal to approve the transfer could ”contribut[e] to," or ”induc[e]” a decision by Metromedia to reform its ways with regard to the handicapped. See dissent at 827, 831. One suggested scenario is that other.shareholders, if not bought out, might "act[ ] to remedy the harm.” See dissent at 831. We think the prospect of scattered shareholders, none holding as much as five percent, rising up to defy Kluge in order to aid the handicapped implausible in the extreme. More plausibly, the dissent observes that Metromedia might choose to "reform its practices in order to obtain permission for the transfer.” Id. at 831. But so might the schools in Allen v. Wright, or the hospitals in Simon v. Eastern Kentucky Welfare Rights Organization, choose to reform in order to gain or retain favorable tax status. See supra note 10. We are at a loss to discern why the causal relationship between alleged injury and agency conduct was more speculative or attenuated in those cases than it is in this one. The transfer here, like the favorable tax treatment in those cases, we believe, does not the meet the “but for” standard described by the Supreme Court in Duke Power Co. v. Carolina Environmental Study Group, 438 U.S. 59, 78, 98 S.Ct. 2620, 2633, 57 L.Ed.2d 595 (1978) (alleged injury would not have occurred “but for the enactment and implementation of the Price-Anderson Act”).

14 . The dissent’s argument basing CAPH’s standing on procedural grounds does not alter our conclusion. The dissent apparently acknowledges that CAPH must allege an underlying substantive stake in the result of the decision in order to assert standing based on a procedural default. See dissent at 832-833. As the discussion above demonstrates, CAPH has no such stake. CAPH’s difficulty regarding standing does not lie in the merits of its arguments concerning the appropriateness of the short form procedure or the legality of Metromedia’s practices; rather, it inheres in the fact that the injury asserted lacks the requisite causal link to the challenged FCC decision.