[00:00:02] Speaker 03:
Case number 16-1100, free access and broadcast telemedia LLC at L Petitioners versus Federal Communications Commission at L. Mr. Menesheim for the petitioners, Mr. Sherr for the respondents.

[00:00:16] Speaker 03:
Mr. Menesheim, good morning.

[00:00:17] Speaker 03:
We meet again.

[00:00:19] Speaker 04:
We do.

[00:00:21] Speaker 04:
Good morning, and may I please report?

[00:00:24] Speaker 04:
This is the case where the rubber hits the road on the FCC's incentive spectrum auction.

[00:00:29] Speaker 04:
It's the third time before the court, but it's the first appeal raising the real-world consequences of LPT extinguishment.

[00:00:37] Speaker 04:
I use that word carefully because this is a game of musical chairs, in which 39 months from now following this repackage of the organization, there's no room left for LPTV.

[00:00:48] Speaker 04:
Unfortunately, we're met essentially with an agency that engages in administrative double-speak and misdirection.

[00:00:54] Speaker 04:
Let me tell you exactly why and what the issue before you is.

[00:00:58] Speaker 04:
Judge Srinivasan wrote the opinion on which Judge Griffith was on the panel in MAKO in August 2006, interpreting for the first time the Spectrum Act.

[00:01:09] Speaker 04:
Two other FCC orders are at issue here.

[00:01:11] Speaker 04:
They were decided before MAKO, implementing that arch.

[00:01:16] Speaker 04:
Both of the orders violate the make-o holding that says LPTV's spectrum usage rights cannot be altered on the basis other than interference.

[00:01:29] Speaker 04:
They also raise other issues under the Regulatory Flexibility Act in the AAPA that I will address.

[00:01:33] Speaker 04:
The record shows, Your Honors, that this agency claimed in its orders that the Spectrum Act was not a constraint on its substantive authority.

[00:01:43] Speaker 04:
That's why in the supplemental orders decided before MACO, they don't address LPTV.

[00:01:49] Speaker 04:
What they do, very cleverly, is disguise their decision in these orders to assign exclusive rights to the Spectrum

[00:01:59] Speaker 04:
to the new wireless carriers.

[00:02:02] Speaker 04:
Exclusive is the word they use, not me.

[00:02:04] Speaker 04:
They want to clear the spectrum.

[00:02:06] Speaker 04:
It's the RF radiofrequency equivalent of a subdivision developer coming in and cutting down all the trees and bushes and building new houses.

[00:02:17] Speaker 04:
The Court rejected the contention that the Spectrum Act was not a constraint.

[00:02:23] Speaker 04:
on their authority in MAKO, the idea of exclusive assignment of this new 600 MHz band to the wireless carriers flatly violates that holding.

[00:02:32] Speaker 04:
You should reverse for the same reasons.

[00:02:35] Speaker 04:
Let me address the two orders.

[00:02:37] Speaker 04:
The first and most important.

[00:02:39] Speaker 00:
Can you just focus our attention on how the challenges that you raise survive the jurisdictional objections that have been?

[00:02:48] Speaker 00:
Of course, of course.

[00:02:51] Speaker 04:
The first objection is that we were required to file comments in the Commencing Operations Order, and therefore we don't meet the Hobbs Act 2344.

[00:03:01] Speaker 04:
Now, without getting into the fact that the FCC wants to have it both ways – they say it's the same proceeding for purposes of binding us in a different proceeding – this Court's precedent requires that the other proceeding be procedurally and substantively independent from the challenge order.

[00:03:19] Speaker 04:
The auction order decided that when a new wireless carrier commences operations, LPDV has to leave.

[00:03:29] Speaker 04:
but it didn't define commencing operations.

[00:03:31] Speaker 01:
It also... I thought the key language in Simmons was separate notices, received different comments, concluded by separate rules promulgated on different dates.

[00:03:41] Speaker 01:
That seems to describe this case to a T.

[00:03:46] Speaker 04:
I would disagree, Your Honor.

[00:03:47] Speaker 04:
I think that the language is the language that the FCC quotes, relies on, and the ones that they look to, Misuka, the 11th Circuit case, about that the second proceeding must be procedurally and subsistently independent.

[00:04:02] Speaker 04:
Okay?

[00:04:03] Speaker 04:
More importantly, there was no new NPRM.

[00:04:06] Speaker 00:
Can I just get one clarification on the language that Judge Griffith just quoted to you?

[00:04:12] Speaker 00:
Do you think that if that language governs that you're out of luck?

[00:04:16] Speaker 04:
No, I don't.

[00:04:17] Speaker 04:
There was no new NPRM issued.

[00:04:19] Speaker 04:
This was simply a public notice.

[00:04:24] Speaker 04:
It decided something that was in principle approved in the first order, but implemented in the second order.

[00:04:33] Speaker 04:
So they are intricately related.

[00:04:40] Speaker 04:
They are not independent at all.

[00:04:42] Speaker 04:
And the basic issue is, how many times do we have to say the same thing?

[00:04:48] Speaker 04:
Our petitioners have participated in every proceeding

[00:04:53] Speaker 04:
where they got noticed that their rights would be affected.

[00:04:57] Speaker 04:
They had no idea about this commencing operations order, that the FCC was going to slip in, and I will cite you, the portions of the order in the brief, an exclusive assignment of this spectrum to the new wireless carriers.

[00:05:10] Speaker 04:
So they've been there, they've been making the same claims all along.

[00:05:13] Speaker 04:
It violates the Act.

[00:05:16] Speaker 04:
It's unfair to the APA, and it deprives us of due process and takes our property every single time.

[00:05:23] Speaker 04:
So at the very least, once you get past 2344, because I think it clearly is a different proceeding, I mean, it's clearly the same proceeding, same docket number, no new NPRM.

[00:05:38] Speaker 00:
uh... society issue once you get past that it's only a question of four or five eight issue preservation which you have discretion as i understand the lay of the land we know by the time of the latest order that there's going to be some definition given to the concept of commencing operations everybody knows that yes people don't know exactly what that definition is going to be but

[00:06:00] Speaker 00:
What we know beforehand is that there is this idea about commencing operations, and once operations have commenced, then the LPTV station gives way to the other entity.

[00:06:13] Speaker 04:
No, the concept in the original order, with respect, Judge, was that when the new carrier commences operation, the LPTV station needs to give away or adjust itself so it doesn't interfere.

[00:06:28] Speaker 04:
That is not the case in this second order.

[00:06:32] Speaker 04:
I would cite the court, and I'll just do this because I don't want to run out of time.

[00:06:36] Speaker 04:
Joint Appendix 567, paragraph 7.

[00:06:39] Speaker 04:
600 MHz carriers had, quote, exclusive access to their spectrum, close quote.

[00:06:47] Speaker 04:
Joint Appendix 571, paragraph 16.

[00:06:50] Speaker 04:
The license does include the right to exclusive use, close quote, of the spectrum.

[00:06:57] Speaker 04:
Those are decisions reached in this order, not in the first order, not foreshadowed, not put out for public comment, and that the FCC in the order

[00:07:08] Speaker 04:
said, do not violate the act, for the reason I said before, because they said the act wasn't a constraint.

[00:07:14] Speaker 04:
It's also in the FCC's brief, carefully buried on pages 22 and 33, access to their spectrum as soon as they're ready to deploy.

[00:07:22] Speaker 04:
And one more point, in the 28-J notice that was filed on Friday, paragraph 11.

[00:07:33] Speaker 04:
Eligible LPTV stations may only apply for channel that remains allocated to broadcast television and not for channels that have been repurposed for the new flexible 600 megahertz band wireless services.

[00:07:46] Speaker 04:
If we are displaced, we can't even apply to serve in the 600 megahertz band.

[00:07:54] Speaker 04:
Exclusive is the opposite of secondary rights.

[00:07:57] Speaker 04:
And this agency, in these orders,

[00:08:00] Speaker 04:
has not been forthright in saying that they made an exclusive assignment.

[00:08:04] Speaker 04:
The auction order never mentions it.

[00:08:07] Speaker 04:
It doesn't do it.

[00:08:08] Speaker 04:
And to suggest that the wireless carriers who have purchased the Spectrum and it will be repurposed so that they have the right

[00:08:19] Speaker 04:
to kick us out violates MAKO.

[00:08:22] Speaker 04:
That means that the 39-month period and the difference between actual and potential interference are very much secondary.

[00:08:29] Speaker 04:
I'm happy to address them if the court likes.

[00:08:31] Speaker 04:
I think we're right on that as well.

[00:08:33] Speaker 04:
I think this court in MAKO, when it said no displacement without interference, meant interference.

[00:08:39] Speaker 04:
It didn't mean a prediction of likely interference in the future.

[00:08:43] Speaker 04:
And as we cite in our reply brief,

[00:08:45] Speaker 04:
For 30 years, the FCC has used the criterion of harmful interference, actual interference.

[00:08:52] Speaker 04:
And the way it works is if someone causes interference, the FCC's rules don't require them to shut down.

[00:08:57] Speaker 04:
They require the other party to go to the FCC, file a complaint, and get an order that requires someone who's interfering a shutdown.

[00:09:04] Speaker 04:
Same thing with Part 15 devices.

[00:09:06] Speaker 04:
Let me just make one more point, unless the court has questions.

[00:09:13] Speaker 04:
The constitutional issues are important, but they are not as important as the Regulatory Flexibility Act.

[00:09:20] Speaker 04:
The Regulatory Flexibility Act is the Rosetta Stone to this case.

[00:09:25] Speaker 04:
It's the Rosetta Stone because our principal claim there is that they didn't quantify the impact on LPTV or explain why quantification was impossible.

[00:09:33] Speaker 04:
That's the first clear requirement of the statute.

[00:09:37] Speaker 04:
They do not meet that.

[00:09:38] Speaker 04:
They don't defend their inability to meet it.

[00:09:41] Speaker 04:
But what they said from day one is that many LPTV stations will be displaced.

[00:09:47] Speaker 04:
I'm sure they'll still claim that they don't know how many, right?

[00:09:50] Speaker 04:
And that is because they didn't do the quantification.

[00:09:54] Speaker 04:
They can do it with their database.

[00:09:56] Speaker 04:
It's very simple.

[00:09:57] Speaker 04:
There's only 23 stations left for LPTV, 13 to 36.

[00:10:02] Speaker 04:
You have to have channel spacing rules every other station.

[00:10:05] Speaker 04:
That leaves 11 in any market.

[00:10:07] Speaker 04:
where there's 11 existing full-power VHF and UHF stations, and that's most of the country, clearly all 30 major markets, we're gone and we're dead in 39 months.

[00:10:17] Speaker 04:
Thank you.

[00:10:18] Speaker 03:
All right.

[00:10:19] Speaker 03:
Mr. Chair.

[00:10:26] Speaker 02:
Good morning.

[00:10:27] Speaker 02:
May it please the court, Bill Scherr for the Federal Communications Commission.

[00:10:31] Speaker 02:
I'd like to focus on two points today.

[00:10:33] Speaker 02:
First, the petition for review is time barred.

[00:10:35] Speaker 02:
Petitioners are challenging prior settled FCC decisions, not the decisions in the orders on review.

[00:10:42] Speaker 02:
Second, if the court reaches the merits, the make-o decision forecloses most of the petitioner's claims.

[00:10:48] Speaker 02:
The petition for review is time-barred.

[00:10:51] Speaker 02:
All of the petitioner's arguments concern three FCC decisions from the original auction order in 2014.

[00:10:57] Speaker 02:
First, not to protect LPTV in the repacking.

[00:11:00] Speaker 02:
Second, the displacement process.

[00:11:02] Speaker 02:
and third the ban plan for cleared spectrum.

[00:11:05] Speaker 02:
The time has expired for appealing the 2014 auction order as well as a reconsideration order that affirmed the FCC's decisions.

[00:11:14] Speaker 02:
The FCC addressed distinct issues in the orders on review, and it refused to reopen its prior decisions.

[00:11:21] Speaker 02:
Notably, petitioners haven't addressed this point in their briefs except to argue that the court could apply MAKO to overturn the FCC's prior decisions.

[00:11:31] Speaker 02:
But that argument ignores the jurisdictional deadlines imposed by the Hobbs Act.

[00:11:37] Speaker 00:
If the court reaches the merits, what about what you just heard this morning to the effect that, look, you can obviously challenge something new in a new order.

[00:11:46] Speaker 00:
That, I think, as a general principle is true.

[00:11:48] Speaker 00:
Your position is they're not challenging anything new.

[00:11:51] Speaker 00:
All the stuff that they're challenging actually was wrapped up in the order that was challenged in the make-up, and so they missed the time.

[00:11:57] Speaker 02:
That's correct, Your Honor.

[00:11:58] Speaker 02:
The decision not to protect LPTV in the repacking was the threshold and the premise for the Commission's channel sharing order and proceeding where the Commission was looking at ways to mitigate the potential impact of the auction as a result of its prior settled decision not to protect LPTV.

[00:12:20] Speaker 02:
In fact, it again refused to reopen the prior decision.

[00:12:24] Speaker 00:
And what they're saying this morning is that

[00:12:27] Speaker 00:
We didn't know until the latest order how exclusive is exclusive.

[00:12:31] Speaker 00:
And now we're now something's clarified that was not on the radar screen beforehand.

[00:12:36] Speaker 00:
And so there the Hobbs Act deadline doesn't apply because what we're now challenging is something that only manifests itself.

[00:12:43] Speaker 02:
Your Honor, their position are focusing on this phrase exclusive access.

[00:12:50] Speaker 02:
I think that all exclusive access means in the places where they refer to it is that once a wireless provider is ready to commence operations on its licensed spectrum, it's entitled to access to that spectrum without harmful interference from any secondary operations including

[00:13:10] Speaker 02:
The commission established the displacement process in all respects except for the one question that it left open of how to define commencing operations in that 2014 auction order.

[00:13:24] Speaker 02:
So there weren't any surprises.

[00:13:27] Speaker 02:
The displacement process makes absolutely clear that at a given point in time the

[00:13:35] Speaker 02:
the wireless provider will be entitled to exclusive access, meaning access without interference.

[00:13:41] Speaker 00:
Okay, so then you're wrapping up the concept of interference into the term exclusive, and so that I think potentially squares things, whereas their view is that exclusive means something without regard to interference.

[00:13:55] Speaker 02:
Correct, Your Honor.

[00:13:57] Speaker 02:
The FCC's description of exclusive access has always been in the context of proceedings where it's made clear that LPTV stations are entitled to continue operating unless and until there's notice provided of the potential for likely interference.

[00:14:17] Speaker 02:
And that's the trigger.

[00:14:18] Speaker 02:
So whenever the commission says exclusive access, that's conditioned.

[00:14:23] Speaker 00:
There's already been a determination

[00:14:25] Speaker 00:
of potential or likely interference, I forget exactly how you described it.

[00:14:29] Speaker 02:
Correct.

[00:14:29] Speaker 02:
And there's nothing, there's no reference to exclusive access in any of the commission's orders where the commission indicated or suggested that it was setting up a different or a new standard.

[00:14:39] Speaker 02:
In fact, the commission refused to reconsider its prior decisions.

[00:14:45] Speaker 02:
If the court reaches the merits, MACO forecloses arguments regarding FCC treatment of LPTV and the displacement process.

[00:14:52] Speaker 02:
The displacement argument is based on a misunderstanding.

[00:14:56] Speaker 02:
Petitioners have conceded that they relied on the wrong rule in their opening brief.

[00:15:02] Speaker 02:
The correct rule, section 733700G4, allows LPTV stations to continue operating until a wireless provider actually displaces them.

[00:15:12] Speaker 02:
And the court recognized this rule in MACO.

[00:15:15] Speaker 02:
Petitioners' arguments regarding treatment of LPTV are rehashed versions of arguments rejected in MAKO.

[00:15:22] Speaker 02:
MAKO affirmed the FCC's decision not to protect LPTV in the repacking because protection would have frustrated auction goals by limiting the recovery of spectrum for the forward auction.

[00:15:34] Speaker 02:
The petitioners now say that they're challenging or advocating something other than protection, but the courts holding plainly encompass the SEC's choices not to include LPTV in the repacking or set aside channels for LPTV after the auction.

[00:15:49] Speaker 02:
Those choices were inherent in the protection decision.

[00:15:56] Speaker 02:
Petitioners' remaining argument is that the FCC altered LPTV rights by subordinating them to unlicensed in the cleared spectrum.

[00:16:06] Speaker 02:
There's at least two problems with that argument.

[00:16:08] Speaker 02:
The first is that it's barred by the Spectrum Act, which provides that the FCC's establishment of banned plans for cleared spectrum isn't subject to any LPTV rights under Section 1452B5.

[00:16:22] Speaker 02:
In addition, the only cleared spectrum where unlicensed use is allowed is the guard bands, and petitioners disavow any challenges to the guard bands, so they seem as though they may have waived that argument.

[00:16:33] Speaker 02:
In conclusion, I'd just like to focus on two things that my opposing counsel said.

[00:16:43] Speaker 02:
The FCC's rules governing interference don't require a primary station that's being interfered with to come to the FCC and file a complaint in order to get clear or, if you will, exclusive access to its spectrum.

[00:17:00] Speaker 02:
All of the FCC's rules

[00:17:02] Speaker 02:
referred to predicted interference and require LPTV stations to resolve predicted interference.

[00:17:09] Speaker 02:
You won't find in the rules any reference to quote-unquote actual interference.

[00:17:19] Speaker 02:
If there are no other questions, then I'll thank you.

[00:17:25] Speaker 03:
All right, thank you.

[00:17:26] Speaker 03:
Does Mr. Manchin have any time?

[00:17:30] Speaker 03:
I want to take two minutes.

[00:17:36] Speaker 04:
I'll make a couple points.

[00:17:38] Speaker 04:
Non-protection is not an issue in this case.

[00:17:41] Speaker 04:
As I said in the brief, we were never arguing that we were entitled to be protected in the repat.

[00:17:48] Speaker 04:
With regard to jurisdiction,

[00:17:51] Speaker 04:
I will concede there's nothing in these orders about unlicensed wireless.

[00:17:57] Speaker 04:
At that point, we were very forthright.

[00:17:59] Speaker 04:
We believe NACO was decided judiciously by deciding only what needed to be decided.

[00:18:04] Speaker 04:
But it's this Court's mandate, and those issues of unlicensed wireless and

[00:18:10] Speaker 04:
And the second one, which is a priority for, I'm sorry, the issues that were not reached in MAKO can be used as the basis by this panel.

[00:18:21] Speaker 04:
And even if we are time barred under 2344 under the Hobbs Act,

[00:18:27] Speaker 04:
The court, whether it's this panel or another panel, has the authority and the ability to enforce the rule of makeup.

[00:18:33] Speaker 04:
Now, let me say that counsel's explanation of what exclusive access means is not in the record.

[00:18:40] Speaker 04:
It's not in any of the FCC proceedings.

[00:18:43] Speaker 04:
It's not in any of their orders.

[00:18:44] Speaker 04:
His interpretation of the orders is not argument.

[00:18:47] Speaker 04:
You are not entitled to rely upon him.

[00:18:49] Speaker 04:
The court has said that for years.

[00:18:51] Speaker 04:
My reply brief, I believe it's footnote 22, cites 30 years of precedent that define harmful interference.

[00:18:59] Speaker 04:
Harmful interference can only mean actual interference.

[00:19:03] Speaker 04:
Exclusive is a word and a phrase first used in the...

[00:19:10] Speaker 04:
They say, this is the paragraph 16, Joint Appendix 571, while a license issued for the 600 megahertz band does include the right to exclusive use, it does not include the immediate right to exclude for the entire license area, the immediate right.

[00:19:26] Speaker 04:
So this idea of technical interference

[00:19:30] Speaker 04:
is a charade.

[00:19:32] Speaker 04:
It's also wrong.

[00:19:33] Speaker 04:
In their brief, which we point out on reply, they say that it is technically impossible for LPTV and wireless to cohabitate the 600 megahertz band.

[00:19:45] Speaker 04:
I don't have the citation handy, but we cite to their reply brief.

[00:19:48] Speaker 04:
That, again, is from the lawyers.

[00:19:49] Speaker 04:
But if that's correct, that explains why they've been using the word exclusive and exclusive rights, because it would be impossible for any LPTV to survive if they both can't do it as a technical matter.

[00:20:04] Speaker 03:
Thank you.