[00:00:02] Speaker 01: Case number 15-1264 at L. Mako Communications LLC Petitioner versus Federal Communications Commission at L. Mr. Colkins for the petitioner, Mr. Lewis for the respondent. [00:00:54] Speaker 03: Good morning. [00:00:54] Speaker 04: Good morning, Your Honor. [00:00:56] Speaker 04: My name's Scott Hawkins. [00:00:58] Speaker 04: I represent MAKO Communications LLC, and I'll be arguing for the petitioners. [00:01:03] Speaker 04: I've reserved two minutes of rebuttal time. [00:01:07] Speaker 04: The primary issue before the Court this morning is the meaning of Section 1452B5 of the Spectrum Act of 2012. [00:01:19] Speaker 04: It is in the part of the Act, the subsection of the Act, that addresses the Commission's power and authority to reassign channels to TV stations as a part of the auction process. [00:01:33] Speaker 04: It's called – referred to by the Commission as the repacking process itself. [00:01:38] Speaker 04: B-5 specifically states [00:01:41] Speaker 04: that nothing in the subsection shall be construed to alter the spectrum usage rights of LPTV, low-power TV stations. [00:01:49] Speaker 03: And where are those spectrum usage rights established and under what authority? [00:01:54] Speaker 03: They're pre-existing, obviously. [00:01:56] Speaker 03: They're being referred to here in B-5. [00:01:58] Speaker 03: Nothing can be done to alter them. [00:02:00] Speaker 03: So what were they? [00:02:02] Speaker 03: When were they established and by what authority? [00:02:04] Speaker 04: Well, Your Honor, they were established originally back in 1982, but the LPTV stations have essentially the same [00:02:13] Speaker 04: rights to use spectrum as full power, classic stations. [00:02:18] Speaker 03: What authority did the FCC establish them in 1982? [00:02:21] Speaker 03: What authority was it drawn from? [00:02:22] Speaker 04: Well, it was a general rulemaking authority, Your Honor, and it conducted a rulemaking, and that's where it was originally established, and at the time, it was established. [00:02:37] Speaker 04: LPTV licensees were established to have secondary [00:02:43] Speaker 04: usage rights for interference purposes to certain users of the spectrum. [00:02:49] Speaker 04: At that time, it was with respect to full power and Class A stations. [00:02:55] Speaker 04: In this particular case, the petitioners contend that the B-5 of the Act is there to protect the usage rights [00:03:05] Speaker 04: that LPTV stations has. [00:03:07] Speaker 04: The Commission takes the position that B-5 provides no protection whatsoever to the LPTV stations in connection with the repacking. [00:03:22] Speaker 00: What protection exactly do you think is secured by B-5? [00:03:27] Speaker 04: Your Honor, what we're saying is the protection secured by B5 is the right to have room, have a channel on which to operate. [00:03:40] Speaker 00: In other words, how does it compare to the protection that would have been accorded to LPTVs if they had been included within B2? [00:03:47] Speaker 04: B2, Your Honor, referring to the population and coverage area, they are not covered. [00:03:57] Speaker 04: LPTV stations are not covered by that provision. [00:04:00] Speaker 04: We're not contending that they're covered by that provision. [00:04:03] Speaker 04: That relates to full power in Class A. The protection for LPTV licensees is found in B5. [00:04:10] Speaker 00: I guess I'm just trying to understand comparatively [00:04:14] Speaker 00: Would it have been possible to include LPTVs within B2? [00:04:19] Speaker 04: Would it have been possible for the commission to do that? [00:04:23] Speaker 04: No, for Congress to have done it. [00:04:26] Speaker 04: It would have been. [00:04:27] Speaker 04: Congress didn't do it. [00:04:28] Speaker 04: The protection that Congress gave LPTV stations was in B5. [00:04:34] Speaker 00: Right, and I'm just trying to understand what is the difference between [00:04:37] Speaker 00: had you been in B2 as opposed to you're now in B5? [00:04:41] Speaker 04: Well, had we been in B2, then in addition to having a channel on which to operate, there would have been an additional protection for population coverage area served for LPTV stations. [00:04:59] Speaker 00: But the entities that are protected by B2 don't get the channel protection, right? [00:05:04] Speaker 00: They're subject to being repacked. [00:05:06] Speaker 04: All entities, both full power Class A and low power television stations are subject to being repacked under B1. [00:05:17] Speaker 04: The protection for full power in Class A is in B2 regarding population served in coverage area. [00:05:25] Speaker 04: The protection for the LPTV licensees is in B5, and it's not the same protection. [00:05:31] Speaker 00: It sounds like it's more. [00:05:33] Speaker 00: Under your argument, B5 gives you more. [00:05:36] Speaker 04: No, no, no, Your Honor, we're not saying that B-5 provides more. [00:05:41] Speaker 04: I think B-5 would say that the Commission could move LPTV licensees to another channel under B-1, reassign a channel under B-1 without the constraint imposed by B-2 for coverage area and population served. [00:06:02] Speaker 02: the commission. [00:06:03] Speaker 02: It's nobody's position that there's any new protection afforded by me. [00:06:09] Speaker 02: All it says he will not alter any right. [00:06:11] Speaker 04: That's correct. [00:06:12] Speaker 04: The only increase won't decrease the existing rights. [00:06:15] Speaker 02: So you have to have the right [00:06:17] Speaker 04: pre-existing this statute before the right is... That's right, and low-power television stations do have rights that pre-exist that statute. [00:06:27] Speaker 02: Their rights are secondary to whatever is primary, certainly secondary to the full-power station and the classics. [00:06:36] Speaker 04: That's correct, but for interference purposes only. [00:06:39] Speaker 02: Well, now, they say for interference purposes only. [00:06:42] Speaker 02: I'm not quite certain [00:06:45] Speaker 02: where you get the authority for interference purposes only. [00:06:51] Speaker 02: What is your? [00:06:52] Speaker 04: Well, the description for LPTV stations in terms of the secondary status description is found part 74 section 703 of the commission's regulations, and it describes [00:07:09] Speaker 04: what that secondary status for your purposes means. [00:07:15] Speaker 04: I don't have it in front of me, but I can essentially say that to the extent that an LPTV that is operating interference arises, then it's the LPTV station. [00:07:28] Speaker 04: that has to yield to that until the interference issue can be resolved. [00:07:34] Speaker 02: Certainly, it is secondary. [00:07:36] Speaker 02: It has two interference purposes. [00:07:39] Speaker 02: It's the only that I'm wondering about. [00:07:42] Speaker 04: Well, Your Honor, it's that point that the Commission is using as justification [00:07:50] Speaker 04: for ignoring LPTV stations in the repacking process itself, because the commission is saying because of that secondary status, we don't need to consider LPTV stations' rights in the repacking process itself. [00:08:10] Speaker 04: It's almost as if, for the commission's sake, it's because of secondary status, the LPTV stations have no usage rights [00:08:18] Speaker 04: and that's how they're being treated in the repacking by being ignored. [00:08:24] Speaker 04: And it's our position that that renders B5 superfluous because you wouldn't need B5 if [00:08:34] Speaker 04: L. P. T. V. Stations were always secondary, uh, and could be displaced and even put off the air in this case. [00:08:44] Speaker 00: It seems to be five still does work. [00:08:46] Speaker 00: If you can throw it in the following way that would be five means is that, um, [00:08:50] Speaker 00: the rest of B doesn't give the commission any greater authority vis-a-vis LPTVs than they otherwise have under law. [00:08:58] Speaker 00: And so, for example, to use one example, interference, it would mean as a general matter, LPTVs are subject to being displaced because of interference considerations based on other sources of law. [00:09:13] Speaker 00: And this B doesn't give the commission any greater authority to do more than that. [00:09:18] Speaker 04: But Your Honor, it's because of LPTV station's secondary status. [00:09:25] Speaker 04: And the fact that that status could be used as an excuse by the commission to essentially cause LPTV licensees to have no usage rights at all, that B5 is in the act. [00:09:39] Speaker 04: It's not, the commission uses that as an excuse, but it helps explain the reason why LPTV needs the protections afforded by B-5 in the act. [00:09:50] Speaker 04: In this case, it's the commission that essentially will be creating the interference. [00:09:56] Speaker 02: It seems an odd way to express a limitation on the commission's power to say nothing in this act will be construed as offering. [00:10:04] Speaker 02: It doesn't say the Commission can't do anything about the stations. [00:10:11] Speaker 02: It does not expressly speak to what the Commission can do. [00:10:14] Speaker 02: Is this not an odd way for Congress to express it, if that's what it means? [00:10:18] Speaker 04: Well, Your Honor, I think that the statute, if the put in context the fact that LPTV stations under B1 can have their stations reassigned just like all the other users, [00:10:36] Speaker 04: And you say that nothing in that reassignment process that could result in the loss of LPTV licensees, that shouldn't be construed to alter the usage rights. [00:10:49] Speaker 04: It has to mean an ability to use it. [00:10:51] Speaker 04: There's nothing in the Act that would give LPTV stations greater rights. [00:10:58] Speaker 04: So you would need a provision that somehow says, hey, commission, you can't give them greater rights. [00:11:04] Speaker 04: LPDV stations only can lose in this repacking process by the commission repacking it so tight [00:11:13] Speaker 04: There's just nowhere for the stations to go, and that's essentially what is happening, given the approach that the FCC has taken with respect to LPTV in the process. [00:11:26] Speaker 04: Your Honor, I see my time is up. [00:11:31] Speaker 03: We'll give you that couple minutes, Senator, if I don't think. [00:11:41] Speaker 05: the court, Jacob Lewis, for the FCC. [00:11:44] Speaker 05: The basic issue in this case is whether B-5 required the commission to protect low-power television stations in the incentive auction repacking. [00:11:54] Speaker 05: The FCC reasonably determined that because of the text, based on the text of the statute and the nature of LPTV licenses and their secondary status. [00:12:03] Speaker 05: But what does B-5 do then? [00:12:05] Speaker 03: What's its purpose? [00:12:06] Speaker 05: I think B-5 [00:12:07] Speaker 05: What it does, and the text, I think, makes this clear, is it provides that the existing rights of low-power television stations, which were secondary, but the day before the Spectrum Act was passed, are the same the day after. [00:12:23] Speaker 05: Nothing in the Spectrum Act was intended to... But if that section were not in there... [00:12:32] Speaker 05: So the LBTV low-power television stations do have a right to operate if they don't cause interference. [00:12:42] Speaker 05: So say for example the Commission were to say, relying on B, because B5 is only a protection against Commission authority under subsection B, but let's say the Commission relied on subsection B to say, you know what? [00:12:56] Speaker 05: a low-power television station that is able to operate without interference to a primary user nonetheless may not operate. [00:13:06] Speaker 00: So what it does is it makes sure that the Commission doesn't get extra authority by virtue of V as against low-power television stations. [00:13:13] Speaker 00: Exactly correct. [00:13:14] Speaker 05: The statute is not construed to give it any [00:13:16] Speaker 05: greater authority. [00:13:16] Speaker 00: It was essentially... It's true, though, that you're relying on an interference protection, basically, because the idea is that, as a general matter, LPTVs can continue to function as long as they don't cause interference. [00:13:29] Speaker 00: And then if the Commission tried to say, well, look, under B, we have all this repacking authority, so we're going to repack away an LPTV station, notwithstanding that it doesn't cause interference, then B5 could be used. [00:13:39] Speaker 00: Exactly right. [00:13:41] Speaker 00: It still leaves open the notion that the extent to which that there's protection for LPTVs vis-a-vis interference is itself a creature of commission law, right? [00:13:52] Speaker 00: Yes. [00:13:52] Speaker 00: So, in other words, [00:13:54] Speaker 05: Well, this is the significance of notwithstanding anything in B, because there's plenty of commission authority outside of B. And indeed, that was the authority the commission relied on to create the low-power television service in the first place. [00:14:06] Speaker 03: But for these purposes... So are you arguing that in the absence of B5, the commission could have [00:14:13] Speaker 03: been far more punitive on the LPTV than they were punitive, it's not the right word, but they could have done, they could have put the LPTVs effectively out of business. [00:14:23] Speaker 05: What I want to point the court to is the very limited language of B5, because it has, the limitation is not just that it doesn't alter, but that there's only a limitation on the Commission's exercise of authority under B. [00:14:35] Speaker 03: And it only goes to the low-paratonic. [00:14:38] Speaker 03: I guess the question I'm asking is, if B-5 were not there, what would have been the commission's authority with respect to LPTVs in Manhattan? [00:14:45] Speaker 05: Perhaps it that the commission could have relied on other parts of B, which, after all, gives the commission broad authority, for example, in B-1, to engage in the repacking, to wipe, to take an extreme example, to wipe the LPTV service. [00:15:00] Speaker 05: You know what? [00:15:00] Speaker 05: It's too much trouble to deal even with their secondary interference rights. [00:15:05] Speaker 05: we'd rather repack, or Congress has given us the ability to repack without even accounting for their ability to operate even if they don't. [00:15:14] Speaker 03: And you think there would have been authority under the Commission's general rule making power to do that before B-5 came along? [00:15:22] Speaker 05: Yes, well, it's undisputed for nearly the life of the commission that the commission has brought authority to allocate spectrum and to identify spectrum for particular uses. [00:15:35] Speaker 05: And again, that was how the LPP's low-power television service was created in the first place. [00:15:40] Speaker 05: The point here is this is an extremely narrow provision. [00:15:44] Speaker 05: It is not an additional protection. [00:15:46] Speaker 05: And I think Judge Srinivasan rightly pointed out, it is in stark contrast to B2. [00:15:51] Speaker 05: B2 actually is a real protection. [00:15:54] Speaker 05: It preserves in the repacking the coverage area and population served. [00:15:58] Speaker 05: But that protection is limited as everyone agrees only to full power and Class A stations and excludes low power television stations. [00:16:06] Speaker 05: And so, in essence, there is a right here. [00:16:09] Speaker 05: Low power television stations have a right. [00:16:10] Speaker 05: It's like the right you have by standby. [00:16:13] Speaker 05: If you go up and you have a standby ticket, and you're informed that there are no longer any seats on the plane, well, you can't fly on the plane. [00:16:22] Speaker 05: And to take another variant of their argument about the amount of spectrum available, if what you thought of 747 was going to pull up, but a 737 pulls up, and that's because there are, and then it turns out there are no more seats, [00:16:36] Speaker 05: You, again, don't have any rights. [00:16:38] Speaker 05: You have standby rights, but they don't extend to controlling the size of the plane or whether there are... That is another issue here, is what are the low-power stations secondary to? [00:16:49] Speaker 02: It seems to be certainly given that they're secondary to full-power stations and class A stations. [00:16:57] Speaker 02: deemed secondary to wireless services? [00:17:01] Speaker 05: Right, and I think that's absolutely, that argument is absolutely foreclosed by the Commission. [00:17:05] Speaker 05: The regulatory history here, which includes the digital TV transition, which in the digital TV transition, to go into the details, channels 52, the old channels 52 to 69, [00:17:17] Speaker 05: we're cleared of broadcasters as a benefit, as a consequence of the switch from analog to digital broadcasting. [00:17:27] Speaker 05: In licensed wireless users, we're placed on, sorry? [00:17:35] Speaker 05: Yes, in fact, what we cite as our best case for this are ordered. [00:17:41] Speaker 02: Maybe your only one. [00:17:43] Speaker 05: Well, we only need one, Your Honor, but I think there are some back of that. [00:17:46] Speaker 05: But the digital LPTV order in volume 19 of the FCC record does clearly lay out the process by which low-power television stations were to cease operations when they were informed that they would be causing interference to wireless users, the wireless users of music. [00:18:05] Speaker 02: In the 2002, you do have the reference to the new wireless services. [00:18:11] Speaker 02: I think in all the other quotations in your brief, and I didn't go take them all one by one, but your quotation marks seem to end, and the Senate goes on then to include them being secondary to... [00:18:23] Speaker 05: Well, the easy explanation for that is usually you're talking about interference in the broadcast spectrum. [00:18:30] Speaker 05: There weren't that many examples of where wireless users were using broadcast spectrum, the digital transition. [00:18:36] Speaker 02: You may not need more than one, but I don't think you have more than one. [00:18:41] Speaker 05: one in which the quotation marks reach out to encompass the even in those earlier orders, your honor, there was quite clear that service called land mobile service was that low power television stations were secondary to those land mobile is a form of [00:18:56] Speaker 05: old radio telephone service, and the quotations we have talk about other primary users. [00:19:02] Speaker 05: It's true that in some of those orders, the other primaries... There's no way to put the other primary... Right. [00:19:07] Speaker 05: But I think the digital LPTV order, which we cite, makes clear that they included licensed wireless users as well, and I think there's no question about that. [00:19:15] Speaker 05: And so, if there was any doubt beforehand, I think it was removed by that order. [00:19:20] Speaker 00: question that Judge Griffith asked, which is that you don't have to take the position that but for B-5, B-1 would have given you extra authority vis-a-vis LPTVs because [00:19:38] Speaker 00: I thought what the commission was suggesting was that it's a rule of construction. [00:19:42] Speaker 00: It's just to assure that there's no extra authority invested in LPTVs. [00:19:46] Speaker 00: It may have been an assurance of something that a court reviewing the statute would have already concluded was the case, but it's just to make it absolutely clear that the [00:19:56] Speaker 00: doesn't give you extra authority. [00:19:58] Speaker 05: I think you're absolutely right. [00:19:59] Speaker 05: That's a very good way of describing it. [00:20:00] Speaker 05: It was an assurance, an assurance that may not have been needed, but nonetheless, or may not amount to much, but nonetheless was placed in the statute in its very limited form. [00:20:15] Speaker 05: The bottom line is that if they really wanted the kind of protection they're seeking for here, which if not B2 protection, is very close to B2 protection. [00:20:23] Speaker 05: They're asking for not to be displaced in the repacking. [00:20:28] Speaker 05: As I heard the council argue today, they want a seat, still maybe not the same size seat after all the repacking is done, but still a seat. [00:20:41] Speaker 05: That's a kind of affirmative protection that they didn't have before. [00:20:44] Speaker 05: because they didn't have protections against causing interference. [00:20:47] Speaker 05: And it is the kind of protection that you would have expected Congress to have drafted. [00:20:51] Speaker 05: If Congress wanted to say, look, low-power television stations, you are protected against displacement and the repacking, you would have expected something directly in subsection B to say that. [00:21:01] Speaker 05: And it would be an extremely odd way of incorporating that kind of protection in the language that they actually passed. [00:21:08] Speaker 05: And the final point, just if I could, the consequence of protecting low-power television stations in the incentive auction repacking would be quite substantial. [00:21:18] Speaker 05: Even if you take low-power television stations to mean the 1,917 stations currently that are originating programming, and the return can also include the TV translators that were at issue in the NAB decision, [00:21:32] Speaker 05: But even if you include those 1,900, that's compared to full power in Class A stations, which right now, according to the commission's figures, are over 2,100. [00:21:41] Speaker 05: We're basically doubling the number of stations that you would have to protect. [00:21:47] Speaker 05: I think that the commission is quite reasonable in saying that that would be unduly constrained, the auction. [00:21:53] Speaker 05: And it is an additional reason why Congress would be unreasonable, or certainly reasonable for the commission not to read B-5. [00:22:01] Speaker 05: to be a protection that would add that many stations into the impact. [00:22:04] Speaker 05: Thank you. [00:22:05] Speaker 03: Thank you very much. [00:22:11] Speaker 04: Your Honor, with respect to the questions that were asked regarding what if B-5 wasn't there, then what? [00:22:21] Speaker 04: Well, the way the commission is treating B-5, it's as if it's not there entirely. [00:22:27] Speaker 04: If it was put there to give some kind of assurance that the Commission is not being given any extra authority under the Act, then that would imply there's something in the Act that could be construed. [00:22:45] Speaker 04: to give the commission extra or additional authority with respect to low-power television stations. [00:22:52] Speaker 04: And there is nothing else in the act that could be construed that. [00:22:56] Speaker 04: LPTV stations can't participate in the reverse auction. [00:23:00] Speaker 04: Their stations are subject to reassignment under B1. [00:23:08] Speaker 04: And they don't have the protections under B2, as we've discussed. [00:23:14] Speaker 04: So there's nothing that could be implied to give additional rights or allow the commission to give additional rights. [00:23:25] Speaker 04: And with respect to the commission's general rulemaking authority, that can't trump the provisions of the act itself. [00:23:35] Speaker 04: I mean, under 303F, the commission does have authority to make regulations that prevent interference, but that's subject to the provisions. [00:23:45] Speaker 00: Maybe I'm getting the terminology wrong, but I thought one hypothetical that was raised by counsel for the commission is that if the commission decided to displace an LPTV station as part of repacking without regard to interference, [00:24:04] Speaker 04: without regard to interference. [00:24:06] Speaker 00: Right, so that even though there's an LPTV station that doesn't interfere, we need to get rid of this LPTV station to do the repacking that we'd like to do. [00:24:16] Speaker 04: Well, in order to do that, the commission would have to look somewhere else to do that and have some other authority to do that. [00:24:25] Speaker 04: That's the point. [00:24:25] Speaker 04: That's the point. [00:24:28] Speaker 00: That's what B-5 does, is it forces the commission to look somewhere else, because otherwise... I'm sorry, Judge. [00:24:33] Speaker 00: As I understand it, otherwise, the commission would have the argument available to it that says, we get to do this because of B, because B gives us repacking authority, and as part of this repacking authority, we don't need anything else. [00:24:45] Speaker 00: Even though you don't cause any ULP TV station, don't cause any interference, we're still going to displace you because B gives us affirmative authority to go down this road. [00:24:53] Speaker 00: And then B-5 says, no, no, no, no, no. [00:24:55] Speaker 00: If you want to do that, you got to look elsewhere in the law. [00:24:57] Speaker 04: Well, but the Commission doesn't have an ability under its rules itself to act to create interference that causes an LPTV station to lose its spectrum usage rights. [00:25:11] Speaker 04: There's nowhere in the Communications Act that would give the Commission the ability to do something like that. [00:25:20] Speaker 00: Well, other than B. And so the argument is that [00:25:22] Speaker 00: This B5 makes sure that B doesn't give the Commission that authority, because otherwise the Commission could come in and say, yeah, we don't have the authority anywhere else, but now we've got this gargantuan authority under B to do repacking. [00:25:34] Speaker 00: And what that authority does is allows us to displace LPTVs, regardless of whether they cause interference. [00:25:40] Speaker 00: And then I think you would rightly stand up and say, no, you can't do that, because B5 says you can't do that. [00:25:46] Speaker 00: But for B five, maybe the commission would at least have that argument available to it. [00:25:50] Speaker 04: And B five tells everything I think without B five, your honor, then there would be no protection whatsoever for LPTV in the repacking process. [00:25:59] Speaker 04: There's no reason to have B five in the statute unless it was to give some kind of protection to LPTV stations. [00:26:09] Speaker 04: Okay. [00:26:09] Speaker 04: Your Honor, if I could just conclude and say we ask that this matter be vacated and remanded for further rulemaking consistent with the rights for LPTV stations. [00:26:23] Speaker 04: Thank you. [00:26:24] Speaker 04: Thank you very much. [00:26:24] Speaker 04: The case is submitted.