Leased Commercial Access; Development of Competition and Diversity in Video Programming Distribution and Carriage, 60652-60674 [2011-24240]
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Federal Register / Vol. 76, No. 189 / Thursday, September 29, 2011 / Rules and Regulations
Commission’s copy contractor, 445 12th
Street, SW., Room CY–B402,
Washington, DC 20554. To request this
document in accessible formats
(computer diskettes, large print, audio
recording, and Braille), send an e-mail
to fcc504@fcc.gov or call the
Commission’s Consumer and
Governmental Affairs Bureau at (202)
418–0530 (voice), (202) 418–0432
(TTY).
FEDERAL COMMUNICATIONS
COMMISSION
47 CFR Parts 0, 1, and 76
[MB Docket No. 07–42; FCC 11–119]
Leased Commercial Access;
Development of Competition and
Diversity in Video Programming
Distribution and Carriage
Federal Communications
Commission.
ACTION: Final rule.
AGENCY:
In 1993, the Federal
Communications Commission (FCC)
adopted rules pertaining to carriage of
video programming vendors by
multichannel video programming
distributors (‘‘MVPDs’’), known as the
‘‘program carriage rules.’’ The rules are
intended to benefit consumers by
promoting competition and diversity in
the video programming and video
distribution markets. In this document,
the FCC amends its rules to improve the
procedures for addressing complaints
alleging violations of the program
carriage rules.
DATES: Effective October 31, 2011,
except for §§ 1.221(h), 1.229(b)(3),
1.229(b)(4), 1.248(a), 1.248(b), 76.7(g)(2),
76.1302(c)(1), 76.1302 (d), 76.1302(e)(1),
and 76.1302(k), which contain
information collection requirements that
are not effective until approved by the
Office of Management and Budget. The
FCC will publish a document in the
Federal Register announcing the
effective date for those sections.
FOR FURTHER INFORMATION CONTACT: For
additional information on this
proceeding, contact David Konczal,
David.Konczal@fcc.gov; of the Media
Bureau, Policy Division, (202) 418–
2120. For additional information
concerning the Paperwork Reduction
Act information collection requirements
contained in this document, contact
Cathy Williams at 202–418–2918, or via
the Internet at PRA@fcc.gov.
SUPPLEMENTARY INFORMATION: This is a
summary of the Commission’s Second
Report and Order, FCC 11–119, adopted
on July 29, 2011 and released on August
1, 2011. The full text of this document
is available for public inspection and
copying during regular business hours
in the FCC Reference Center, Federal
Communications Commission, 445 12th
Street, SW., CY–A257, Washington, DC
20554. This document will also be
available via ECFS (https://www.fcc.gov/
cgb/ecfs/). (Documents will be available
electronically in ASCII, Word 97, and/
or Adobe Acrobat.) The complete text
may be purchased from the
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SUMMARY:
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Paperwork Reduction Act of 1995
Analysis
This document adopts new or revised
information collection requirements
subject to the Paperwork Reduction Act
of 1995 (PRA), Public Law 104–13 (44
U.S.C. 3501–3520). The requirements
will be submitted to the Office of
Management and Budget (OMB) for
review under section 3507 of the PRA.
The Commission will publish a separate
notice in the Federal Register inviting
comment on the new or revised
information collection requirements
adopted in this document. The
requirements will not go into effect until
OMB has approved it and the
Commission has published a notice
announcing the effective date of the
information collection requirements. In
addition, we note that pursuant to the
Small Business Paperwork Relief Act of
2002, Public Law 107–198, see 44 U.S.C.
3506(c)(4), we previously sought
specific comment on how the
Commission might ‘‘further reduce the
information collection burden for small
business concerns with fewer than 25
employees.’’ In this present document,
we have assessed the potential effects of
the various policy changes with regard
to information collection burdens on
small business concerns, and find that
these requirements will benefit many
companies with fewer than 25
employees by promoting the fair and
expeditious resolution of program
access complaints. In addition, we have
described impacts that might affect
small businesses, which includes most
businesses with fewer than 25
employees, in the Final Regulatory
Flexibility Analysis (‘‘FRFA’’) below.
Summary of the Second Report and
Order
I. Introduction
1. In 1993, the Commission adopted
rules implementing a provision of the
1992 Cable Act 1 pertaining to carriage
of video programming vendors by
multichannel video programming
1 See Cable Television Consumer Protection and
Competition Act of 1992, Public Law 102–385, 106
Stat. 1460 (1992) (‘‘1992 Cable Act’’); see also 47
U.S.C. 536.
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distributors (‘‘MVPDs’’) intended to
benefit consumers by promoting
competition and diversity in the video
programming and video distribution
markets (the ‘‘program carriage’’ rules).2
As required by Congress, these rules
allow for the filing of complaints with
the Commission alleging that an MVPD
has (i) Required a financial interest in a
video programming vendor’s program
service as a condition for carriage; (ii)
coerced a video programming vendor to
provide, or retaliated against a vendor
for failing to provide, exclusive rights as
a condition of carriage; or (iii)
unreasonably restrained the ability of an
unaffiliated video programming vendor
to compete fairly by discriminating in
video programming distribution on the
basis of affiliation or nonaffiliation of
vendors in the selection, terms, or
conditions for carriage. Congress
specifically directed the Commission to
provide for ‘‘expedited review’’ of these
complaints and to provide for
appropriate penalties and remedies for
any violations. Programming vendors
have complained that the Commission’s
procedures for addressing program
carriage complaints have hindered the
filing of legitimate complaints and have
failed to provide for the expedited
review envisioned by Congress.
2. In this Second Report and Order in
MB Docket No. 07–42,3 we take initial
steps to improve our procedures for
addressing program carriage complaints
by 4:
2 See Implementation of Sections 12 and 19 of the
Cable Television Consumer Protection and
Competition Act of 1992, Development of
Competition and Diversity in Video Programming
Distribution and Carriage, MM Docket No. 92–265,
Second Report and Order 9 FCC Rcd 2642 (1993)
(‘‘1993 Program Carriage Order’’); see also
Implementation of the Cable Television Consumer
Protection And Competition Act of 1992,
Development of Competition and Diversity in Video
Programming Distribution and Carriage, MM
Docket No. 92–265, Memorandum Opinion and
Order, 9 FCC Rcd 4415 (1994) (‘‘1994 Program
Carriage Order’’). The Commission’s program
carriage rules are set forth at 47 CFR 76.1300–
76.1302.
3 The initial Notice of Proposed Rulemaking in
MB Docket No. 07–42 was released in June 2007
and pertains to both program carriage and leased
access issues. See Leased Commercial Access;
Development of Competition and Diversity in Video
Programming Distribution and Carriage, MB Docket
No. 07–42, Notice of Proposed Rule Making, 22 FCC
Rcd 11222 (2007) (‘‘Program Carriage NPRM’’). The
Commission released a Report and Order and
Further Notice of Proposed Rulemaking in this
docket in February 2008 pertaining only to leased
access issues. See Leased Commercial Access;
Development of Competition and Diversity in Video
Programming Distribution and Carriage, MB Docket
No. 07–42, Report and Order, 23 FCC Rcd 2909
(2008), stayed by United Church of Christ, et al. v.
FCC, No. 08–3245 (6th Cir. 2008).
4 The new procedures adopted in the Second
Report and Order do not apply to program carriage
complaints that are currently pending or to program
carriage complaints that are filed before the
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Federal Register / Vol. 76, No. 189 / Thursday, September 29, 2011 / Rules and Regulations
• Codifying in our rules what a
program carriage complainant must
demonstrate in its complaint to
establish a prima facie case of a program
carriage violation;
• Providing the defendant with 60
days (rather than the current 30 days) to
file an answer to a program carriage
complaint;
• Establishing deadlines for action by
the Media Bureau and Administrative
Law Judges (‘‘ALJ’’) when acting on
program carriage complaints; and
• Establishing procedures for the
Media Bureau’s consideration of
requests for a temporary standstill of the
price, terms, and other conditions of an
existing programming contract by a
program carriage complainant seeking
renewal of such a contract.
3. In the Notice of Proposed
Rulemaking in MB Docket No. 11–131,
we seek comment on the following
proposed revisions to or clarifications of
our program carriage rules, which are
intended to further improve our
procedures and to advance the goals of
the program carriage statute:
• Modifying the program carriage
statute of limitations to provide that a
complaint must be filed within one year
of the act that allegedly violated the
rules;
• Revising discovery procedures for
program carriage complaint proceedings
in which the Media Bureau rules on the
merits of the complaint after discovery
is conducted, including expanded
discovery procedures (also known as
party-to-party discovery) and an
automatic document production
process, to ensure fairness to all parties
while also ensuring compliance with
the expedited resolution deadlines
adopted in the Second Report and Order
in MB Docket No. 07–42;
• Permitting the award of damages in
program carriage cases;
• Providing the Media Bureau or ALJ
with the discretion to order parties to
submit their best ‘‘final offer’’ for the
rates, terms, and conditions for the
programming at issue in a complaint
proceeding to assist in crafting a
remedy;
• Clarifying the rule that delays the
effectiveness of a mandatory carriage
remedy until it is upheld by the
Commission on review, including
codifying a requirement that the
defendant MVPD must make an
evidentiary showing to the Media
Bureau or an ALJ as to whether a
effective date of the new procedures adopted
herein. See The Tennis Channel Inc. v. Comcast
Cable Communications, LLC, MB Docket No. 10–
204, File No. CSR–8258–P (filed January 5, 2010);
Bloomberg, L.P. v. Comcast Cable Communications,
LLC, MB Docket No. 11–104 (filed June 13, 2011).
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mandatory carriage remedy would result
in deletion of other programming;
• Codifying in our rules that
retaliation by an MVPD against a
programming vendor for filing a
program carriage complaint is
actionable as a potential form of
discrimination on the basis of affiliation
and adopting other measures to address
retaliation;
• Adopting a rule that requires a
vertically integrated MVPD to negotiate
in good faith with an unaffiliated
programming vendor with respect to
video programming that is similarly
situated to video programming affiliated
with the MVPD;
• Clarifying that the discrimination
provision precludes a vertically
integrated MVPD from discriminating
on the basis of a programming vendor’s
lack of affiliation with another MVPD;
and
• Codifying in our rules which party
bears the burden of proof in program
carriage discrimination cases.
We also invite commenters to suggest
any other changes to our program
carriage rules that would improve our
procedures and promote the goals of the
program carriage statute.
II. Background
4. In the 1992 Cable Act, Congress
sought to promote competition and
diversity in the video distribution
market as well as in the market for video
programming carried by cable operators
and other MVPDs. Congress expressed
concern that the market power held by
cable operators would adversely impact
programming vendors, noting that
‘‘programmers are sometimes required
to give cable operators an exclusive
right to carry the programming, a
financial interest, or some other added
consideration as a condition of carriage
on the cable system.’’ 5 Congress also
explained that increased vertical
integration in the cable industry could
harm programming vendors because it
gives cable operators ‘‘the incentive and
ability to favor their affiliated
programmers.’’ 6 Congress concluded
5 S. Rep. No. 102–92 (1991), at 24, reprinted in
1992 U.S.C.C.A.N. 1133, 1157; see also id. (‘‘[T]he
Committee continues to believe that the operator in
certain instances can abuse its locally-derived
market power to the detriment of programmers and
competitors.’’); H.R. Rep. No. 102–628 (1992), at 41
(‘‘Submissions to the Committee also suggest that
some vertically integrated MSOs have agreed to
carry a programming service only in exchange for
an ownership interest in the service.’’).
6 1992 Cable Act 2(a)(5) (‘‘The cable industry has
become vertically integrated; cable operators and
cable programmers often have common ownership.
As a result, cable operators have the incentive and
ability to favor their affiliated programmers. This
could make it more difficult for noncable-affiliated
programmers to secure carriage on cable systems.’’);
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60653
that this harm to programming vendors
could adversely affect both
competition 7 and diversity 8 in the
video programming market, as well as
hinder competition in the video
distribution market.9
5. To address these concerns,
Congress passed section 616 of the
Communications Act of 1934, as
amended (the ‘‘Act’’), which directs the
Commission to ‘‘establish regulations
governing program carriage agreements
and related practices between cable
see also S. Rep. No. 102–92 (1991), at 25, reprinted
in 1992 U.S.C.C.A.N. 1133, 1158 (‘‘vertical
integration gives cable operators the incentive and
ability to favor their affiliated programming
services’’); see id. (‘‘For example, the cable operator
might give its affiliated programmer a more
desirable channel position than another
programmer, or even refuse to carry other
programmers.’’); H.R. Rep. No. 102–628 (1992), at
41 (‘‘Submissions to the Committee allege that some
cable operators favor programming services in
which they have an interest, denying system access
to programmers affiliated with rival MSOs and
discriminating against rival programming services
with regard to price, channel positioning, and
promotion.’’).
7 See S. Rep. No. 102–92 (1991), at 25–26,
reprinted in 1992 U.S.C.C.A.N. 1133, 1158–59
(‘‘Because of the trend toward vertical integration,
cable operators now have a clear vested interest in
the competitive success of some of the
programming services seeking access through their
conduit.’’); H.R. Rep. No. 102–628 (1992), at 41
(‘‘[T]he Committee received testimony that
vertically integrated operators have impeded the
creation of new programming services by refusing
or threatening to refuse carriage to such services
that would compete with their existing
programming services.’’); see also 47 U.S.C.
536(a)(3) (requiring the Commission to adopt
regulations prohibiting discrimination on the basis
of affiliation that has ‘‘the effect of * * *
unreasonably restrain[ing] the ability of an
unaffiliated video programming vendor to compete
fairly’’); 1993 Program Carriage Order, 9 FCC Rcd
at 2643, para. 2 (‘‘Congress concluded that
vertically integrated cable operators have the
incentive and ability to favor affiliated programmers
over unaffiliated programmers with respect to
granting carriage on their systems. Cable operators
or programmers that compete with the vertically
integrated entities may suffer harm to the extent
that they do not receive such favorable terms.’’).
8 See H.R. Rep. No. 102–628 (1992), at 41 (‘‘The
Committee received testimony that vertically
integrated companies reduce diversity in
programming by threatening the viability of rival
cable programming services.’’).
9 In addition to promoting competition and
diversity in the video programming market, the
Commission has explained that the program
carriage provision of the 1992 Cable Act is also
intended to promote competition in the video
distribution market by ensuring that MVPDs have
access to programming. See 1994 Program Carriage
Order, 9 FCC Rcd at 4419, para. 28 (‘‘[I]n passing
section 616, Congress was concerned with the effect
a cable operator’s market power would have both
on programmers and on competing MVPDs
* * *.’’); see also S. Rep. No. 102–92 (1991), at 23,
reprinted in 1992 U.S.C.C.A.N. 1133, 1156 (‘‘In
addition to using its market power to the detriment
of consumers directly, a cable operator with market
power may be able to use this power to the
detriment of programmers. Through greater control
over programmers, a cable operator may be able to
use its market power to the detriment of video
distribution competitors.’’).
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Federal Register / Vol. 76, No. 189 / Thursday, September 29, 2011 / Rules and Regulations
operators or other [MVPDs] and video
programming vendors.’’ 10 Congress
mandated that these regulations shall
include provisions prohibiting a cable
operator or other MVPD from engaging
in three types of conduct: (i) ‘‘Requiring
a financial interest in a program service
as a condition for carriage on one or
more of such operator’s systems’’ (the
‘‘financial interest’’ provision); (ii)
‘‘coercing a video programming vendor
to provide, and from retaliating against
such a vendor for failing to provide,
exclusive rights against other [MVPDs]
as a condition of carriage on a system’’
(the ‘‘exclusivity’’ provision); and (iii)
‘‘engaging in conduct the effect of which
is to unreasonably restrain the ability of
an unaffiliated video programming
vendor to compete fairly by
discriminating in video programming
distribution on the basis of affiliation or
nonaffiliation of vendors in the
selection, terms, or conditions for
carriage of video programming provided
by such vendors’’ (the ‘‘discrimination’’
provision). Section 616 also directs the
Commission to (i) ‘‘Provide for
expedited review of any complaints
made by a video programming vendor
pursuant to’’ section 616; (ii) ‘‘provide
for appropriate penalties and remedies
for violations of [section 616], including
carriage’’; and (iii) ‘‘provide penalties to
be assessed against any person filing a
frivolous complaint pursuant to’’
section 616.
6. In the 1993 Program Carriage
Order, the Commission implemented
section 616 by adopting procedures for
the review of program carriage
complaints as well as penalties and
remedies. In doing so, the Commission
explained that its rules were intended to
prohibit the activities specified by
Congress ‘‘without unduly interfering
with legitimate negotiating practices
between [MVPDs] and programming
vendors.’’ The Commission’s procedures
generally provide for resolution of a
program carriage complaint in one of
four ways: (i) If the Media Bureau
determines that the complainant has not
made a prima facie showing in its
complaint of a violation of the program
carriage rules, the Media Bureau will
dismiss the complaint; (ii) if the Media
Bureau determines that the complainant
has made a prima facie showing and the
record is sufficient to resolve the
complaint, the Media Bureau will rule
on the merits of the complaint based on
the pleadings without discovery; (iii) if
the Media Bureau determines that the
10 47 U.S.C. 536. A ‘‘video programming vendor’’
is defined as ‘‘a person engaged in the production,
creation, or wholesale distribution of video
programming for sale.’’ 47 U.S.C. 536(b).
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complainant has made a prima facie
showing but the record is not sufficient
to resolve the complaint, the Media
Bureau will outline procedures for
discovery before proceeding to rule on
the merits of the complaint; and (iv) if
the Media Bureau determines that the
complainant has made a prima facie
showing but the disposition of the
complaint or discrete issues raised in
the complaint will require resolution of
factual disputes in an adjudicatory
hearing or extensive discovery, the
Media Bureau will refer the proceeding
or discrete issues arising in the
proceeding for an adjudicatory hearing
before an ALJ. The Commission decided
that appropriate relief for violations of
the program carriage rules would be
determined on a case-by-case basis, and
could include forfeitures, mandatory
carriage, or carriage on terms revised or
specified by the Commission.11
7. In June 2007, the Commission
released the Program Carriage NPRM
seeking comment on revisions to the
Commission’s program carriage rules
and complaint procedures. The
Commission sought comment on
whether and how the processes for
resolving program carriage complaints
should be modified; whether the
elements of a prima facie case should be
clarified; whether the deadline for
resolving the program carriage
complaint at issue in the MASN I HDO
or a similar deadline should apply to all
program carriage complaints; and
whether additional rules are necessary
to protect programming vendors from
potential retaliation for filing a program
carriage complaint.
III. Second Report and Order in MB
Docket No. 07–42
8. As discussed below, the record
reflects that our current program
carriage procedures are ineffective and
11 See 1993 Program Carriage Order, 9 FCC Rcd
at 2653, para. 26. Eleven program carriage
complaints have been filed in the approximately
two decades since Congress passed section 616 in
the 1992 Cable Act, two of which are currently
pending before an ALJ or the Media Bureau. See
The Tennis Channel Inc. v. Comcast Cable
Communications, LLC, Hearing Designation Order
and Notice of Opportunity for Hearing for
Forfeiture, 25 FCC Rcd 14149 (MB 2010) (‘‘Tennis
Channel HDO’’); Bloomberg, L.P. v. Comcast Cable
Communications, LLC, MB Docket No. 11–104 (filed
June 13, 2011). In addition, the Commission has
resolved on the merits a program carriage claim
arising through the program carriage arbitration
condition applicable to Regional Sports Networks
(‘‘RSNs’’) adopted in the Adelphia Order. See TCR
Sports Broadcasting Holding, L.L.P., d/b/a MidAtlantic Sports Network v. Time Warner Cable Inc.,
Order on Review, 23 FCC Rcd 15783 (MB 2008),
reversed by Memorandum Opinion and Order, 25
FCC Rcd 18099 (2010) (‘‘MASN v. Time Warner
Cable’’), appeal pending sub nom. TCR Sports
Broadcasting Holding, L.L.P., d/b/a Mid-Atlantic
Sports Network v. FCC, No. 11–1151 (4th Cir.).
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in need of reform.12 Among other
concerns, programming vendors and
other commenters cite uncertainty
concerning the evidence a complainant
must provide to establish a prima facie
case, 13 unpredictable delays in the
12 See Ex Parte Reply Comments of HDNet (June
2, 2010) at 6 (‘‘A right without an effective remedy
is like having no right at all. Today, neither MVPDs
nor independent programmers have reason to think
that a possible statutory violation will be redressed
by the FCC in a timely and effective manner.’’);
Comments of Black Television News Channel, LLC
at 4 (‘‘BTNC Comments’’); Comments of National
Alliance of Media Arts and Culture et al. at 18–19
(‘‘NAMAC Comments’’); Comments of NFL
Enterprises LLC at 6–8 (‘‘NFL Enterprises
Comments’’); Comments of The America Channel at
9–11 (‘‘TAC Comments’’); Reply Comments of
Crown Media Holdings, Inc. at 10–11 (‘‘Hallmark
Channel Reply’’); Reply Comments of HDNet at 1
(‘‘HDNet Reply’’); Reply Comments of National
Alliance of Media Arts and Culture et al. at 18–19
(‘‘NAMAC Reply’’); Reply Comments of NFL
Enterprises LLC at 5–6 (‘‘NFL Enterprises Reply’’);
Reply Comments of WealthTV at 1–2 (‘‘WealthTV
Reply’’); see also Letter from Stephen A.
Weiswasser, Counsel for the Outdoor Channel, to
Marlene H. Dortch, Secretary, FCC, MB Docket No.
07–42 (Nov. 16, 2007) at 2 (‘‘Outdoor Channel Nov.
16, 2007 Ex Parte Letter’’); Letter from Larry F.
Darby, American Consumer Institute, to Marlene H.
Dortch, Secretary, FCC, MB Docket No. 07–42 (Nov.
20, 2007) at 14 (‘‘ACI Nov. 20, 2007 Ex Parte
Letter’’); Letter from David S. Turetsky, Counsel for
HDNet LLC, to Marlene H. Dortch, Secretary, FCC,
MB Docket No. 07–42 (Nov. 20, 2007) at 1–2
(‘‘HDNet Nov. 20, 2007 Ex Parte Letter’’); Letter
from Kathleen Wallman, Counsel for National
Association of Independent Networks (‘‘NAIN’’), to
Marlene H. Dortch, Secretary, FCC, MB Docket No.
07–42 (June 5, 2008), Attachment (‘‘NAIN June 5,
2008 Ex Parte Letter’’); Letter from John Lawson,
Executive Vice President, ION Media Networks, to
Kevin J. Martin, Chairman, FCC, MB Docket No. 07–
42 (Dec. 11, 2008), Attachment at 1 (‘‘ION Dec. 11,
2008 Ex Parte Letter’’). Members of Congress have
also expressed concern with the program carriage
complaint process. See Letter from Kathleen
Wallman, Counsel for WealthTV, to Marlene H.
Dortch, Secretary, FCC, MB Docket No. 07–42 (Aug.
4, 2008) (‘‘WealthTV Aug. 4, 2008 Ex Parte Letter’’)
(attaching Letter from U.S. Sen. Kay Bailey
Hutchison to Kevin J. Martin, Chairman, FCC (July
27, 2008) at 1 (expressing continued concern that
‘‘the existing dispute resolution processes are not
encouraging the timely resolution of these disputes
or providing the proper incentives for the parties to
negotiate terms’’)); id. (attaching Letter from U.S.
Sen. Amy Klobuchar to Kevin J. Martin, Chairman,
FCC (July 24, 2008) at 1 (‘‘Without an effective and
timely FCC process to decide complaints * * * the
integrity of any safeguards against program carriage
discrimination is undermined.’’)); Letter from David
S. Turetsky, Counsel for HDNet LLC, to Marlene H.
Dortch, Secretary, FCC, MB Docket No. 07–42 (July
22, 2008) (‘‘HDNet July 22, 2008 Ex Parte Letter’’)
(attaching Letter from U.S. Sen. Herb Kohl to Kevin
J. Martin, Chairman, FCC (June 23, 2008) at 2
(urging the Commission ‘‘to strengthen the program
carriage rules and to simplify and make more
efficient the process by which program carriage
complaints are adjudicated’’)); id. (attaching Letter
from U.S. Reps. Gene Green, Mike Doyle, and
Charles Gonzalez to Kevin J. Martin, Chairman, FCC
(June 30, 2008) at 1–2 (‘‘The current complaint
process is not as efficient as it could be * * * . [W]e
urge you to provide more effective remedies and
streamline the complaint process * * * .’’)).
13 See TAC Comments at 10; NAMAC Reply at
18–19; WealthTV Reply at 1; NAIN June 5, 2008 Ex
Parte Letter, Attachment at 1; Letter from Harold
Feld, Counsel for NAMAC et al., to Marlene H.
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Commission’s resolution of
complaints,14 and fear of retaliation 15 as
impeding the filing of legitimate
program carriage complaints. While
MVPDs contend that the limited number
of program carriage complaints filed to
date demonstrates that the current
procedures are working and that rule
changes are not necessary, 16
programming vendors contend that the
lack of complaints is a direct result of
our inadequate procedures, not a lack of
program carriage claims.17 As discussed
below, we take initial steps to improve
these procedures by: (i) Codifying in our
rules what a program carriage
complainant must demonstrate in its
complaint to establish a prima facie case
of a program carriage violation; (ii)
Dortch, Secretary, FCC, MB Docket No. 07–42 (May
2, 2008) at 1 (‘‘NAMAC May 2, 2008 Ex Parte
Letter’’).
14 See Letter from Jonathan D. Blake, Counsel for
the National Football League, to Marlene H. Dortch,
Secretary, FCC, MB Docket No. 07–42 (Nov. 5,
2009) at 2 (‘‘Based on the experience in the nowsettled NFL Network/Comcast hearing, the NFL
believes that the Commission’s processes are too
slow * * *.’’); BTNC Comments at 4; TAC
Comments at 9; Letter from David S. Turetsky,
Counsel for HDNet, to Marlene H. Dortch, Secretary,
FCC, MB Docket No. 07–42 (June 16, 2010), at 5
(‘‘HDNet June 16, 2010 Ex Parte Letter’’); see also
NAMAC Comments at 18; HDNet Reply at 1; NFL
Enterprises Reply at 8; WealthTV Reply at 1; ION
Dec. 11, 2008 Ex Parte Letter, Attachment at 1;
NAIN June 5, 2008 Ex Parte Letter, Attachment at
1.
15 See BTNC Comments at 4; NAMAC Comments
at 18–19; NFL Enterprises Comments at 8 n.28; NFL
Enterprises Reply at 6; NAIN June 5, 2008 Ex Parte
Letter, Attachment at 1.
16 See Comments of Comcast Corporation at 27,
33 (‘‘Comcast Comments’’); Comments of the
National Cable and Telecommunications
Association at 14–15 (‘‘NCTA Comments’’);
Comments of Time Warner Cable Inc. at 27–29
(‘‘TWC Comments’’); Reply Comments of Comcast
Corporation at 21–23 (‘‘Comcast Reply’’); Reply
Comments of the National Cable and
Telecommunications Association at 18–19 (‘‘NCTA
Reply’’); Reply Comments of Time Warner Cable
Inc. at 2–3 (‘‘TWC Reply’’); Reply Comments of
Verizon at 9–10 (‘‘Verizon Reply’’).
17 See Letter from Stephen A. Weiswasser,
Counsel for the Hallmark Channel, to Marlene H.
Dortch, Secretary, FCC, MB Docket No. 07–42 (Nov.
6, 2007) at 1–2 (‘‘[T]he absence of complaints under
the existing program carriage regime is not evidence
of lack of discrimination, but, to the contrary, a
reflection of the difficulties presented to
independents by the high burdens of going forward
under the existing rules and the prospects for
retaliation by MVPDs.’’) (‘‘Hallmark Channel Nov.
6, 2007 Ex Parte Letter’’); see also BTNC Comments
at 4 (citing fear of retaliation, unpredictable cost
and delay, and uncertainty regarding evidence
required and adequacy of relief as reasons for why
few program carriage complaints have been filed to
date); Hallmark Channel Reply at 11 (‘‘[I]t simply
is not the case that only two programmers have
experienced discrimination during the time the
rules have been in effect. The reality is that
programmers do not bring complaints under the
existing rules because of their high burden of proof
with respect to predatory practices, the difficulty of
fashioning meaningful resolutions, and the fear of
retribution, not because discrimination does not, in
fact, occur.’’).
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providing the defendant with 60 days
(rather than the current 30 days) to file
an answer to a program carriage
complaint; (iii) establishing deadlines
for action by the Media Bureau and an
ALJ when acting on program carriage
complaints; and (iv) establishing
procedures for the Commission’s
consideration of requests for a
temporary standstill of the price, terms,
and other conditions of an existing
programming contract by a program
carriage complainant seeking renewal of
such a contract.
A. Prima Facie Case
9. In the 1993 Program Carriage
Order, the Commission described the
evidence a program carriage
complainant must provide in its
complaint to establish a prima facie
case. Among other things, the
Commission stated that the ‘‘complaint
must be supported by documentary
evidence of the alleged violation, or by
an affidavit (signed by an authorized
representative or agent of the
complaining programming vendor)
setting forth the basis for the
complainant’s allegations.’’ The
Commission also emphasized that the
complaint ‘‘may not merely reflect
conjecture or allegations based only on
information and belief.’’ The record
reflects that programming vendors are
uncertain as to what evidence must be
provided in a complaint to meet the
prima facie requirement.18 The National
Association of Independent Networks
(‘‘NAIN’’), for example, notes that our
rules do not contain a definition of what
constitutes a prima facie case and that
this lack of clarity impedes
programming vendors from asserting
18 See TAC Comments at 10 (‘‘[T]here are no clear
guidelines on what constitutes a prima facie case
of discrimination.’’); NAMAC Reply at 18–19
(‘‘[T]he current prima facie case requirement
actively prevents the Commission from fulfilling
the statutory command to resolve complaints
‘expeditiously.’ Similarly, evidence in the record
from independent programmers demonstrates that
the prima facie case requirement may dissuade
independent programmers from bringing genuine
complaints due to confusion over the appropriate
standard * * *.’’); WealthTV Reply at 1 (‘‘It is
critical for independent programmers to know
exactly what kind of evidence, and how much
evidence, they need to present to move forward
with a complaint.’’); see also HDNet July 22, 2008
Ex Parte Letter (attaching Letter from U.S. Reps.
Gene Green, Mike Doyle, and Charles Gonzalez to
Kevin J. Martin, Chairman, FCC (June 30, 2008) at
2 (urging the Commission to adopt a ‘‘better defined
and more reasonable definition of a prima facie
case’’); NAMAC May 2, 2008 Ex Parte Letter at 1
(‘‘If the Commission elects to retain the prima facie
screen, the Commission must clarify what
applicants must prove to meet this burden * * *
.’’).
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60655
their program carriage rights through the
complaint process.19
10. While one commenter notes that
the prima facie step is not required by
the statute and urges the Commission to
eliminate this step entirely,20 we believe
that retaining this requirement is
important to dispose promptly of
frivolous complaints and to ensure that
only legitimate complaints proceed to
further evidentiary proceedings. We
agree, however, that clarifying what is
required to establish a prima facie case
and codifying these requirements in our
rules will help to reduce uncertainty
regarding the prima facie requirement.
In the following paragraphs, we clarify
the requirements for establishing a
prima facie case.
11. As an initial matter, all complaints
alleging a violation of any of the
program carriage rules (i.e., the financial
interest, exclusivity, or discrimination
provisions) must contain evidence that
(i) the complainant is a video
programming vendor as defined in
section 616(b) of the Act and
§ 76.1300(e) of the Commission’s rules
or an MVPD as defined in section
602(13) of the Act and § 76.1300(d) of
the Commission’s rules; 21 and (ii) the
defendant is an MVPD as defined in
section 602(13) of the Act and
§ 76.1300(d) of the Commission’s rules.
We note that, as originally adopted in
the 1993 Program Carriage Order, the
Commission’s rules provided that a
complaint must contain the ‘‘address
and telephone number of the
19 See NAIN June 5, 2008 Ex Parte Letter,
Attachment (‘‘Currently, there is no definition in
the rules of what constitutes a prima facie case.
Consequently, defendants argue their own versions
of the standard to try to get independent
programmers’ complaints dismissed. This lack of
clarity is a problem for independent programmers
who are in litigation before the Commission, and for
programmers who are contemplating litigation to
vindicate their rights.’’).
20 See NAMAC Reply at 18 (‘‘[T]he Commission
adopted the requirement to establish a prima facie
case solely on the basis of its own initiative.* * *
[N]othing in section 616 requires the Commission
to use a prima facie case requirement to limit the
number of potentially frivolous complaints.’’).
21 See 1993 Program Carriage Order, 9 FCC Rcd
at 2654, para. 29; see also 47 U.S.C. 522(13), 536(b);
47 CFR 76.1300(d), (e). In the 1994 Program
Carriage Order, the Commission amended the
program carriage rules to allow MVPDs, in addition
to video programming vendors, to file complaints
alleging a violation of the program carriage rules.
See 1994 Program Carriage Order, 9 FCC Rcd at
4418–20, paras. 24–33. The Commission expressed
concern that a video programming vendor that had
been coerced into granting anticompetitive
concessions, including exclusivity, to a cable
operator might be dissuaded from filing a program
carriage complaint based on fears of alienating the
cable operator. See id. at 4416, para. 10 and 4420,
paras. 30–31. Accordingly, the Commission
amended its rules to provide MVPDs aggrieved by
a violation of section 616 to file a program carriage
complaint with the Commission. See id. at 4415,
para. 3 and 4418–19, para. 24.
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complainant, the type of multichannel
video programming distributor that
describes the defendant, and the address
and telephone number of the
defendant.’’ In 1999, the Commission
reorganized the part 76 pleading and
complaint process rules and, in the
course of doing so, amended this rule to
require the complaint to contain the
‘‘type of multichannel video
programming distributor that describes
complainant, the address and telephone
number of the complainant, and the
address and telephone number of each
defendant.’’ We find this revised
language confusing because it fails to
reflect that a program carriage
complainant can be either an MVPD or
a video programming vendor. We
amend this rule to clarify that the
complaint must specify ‘‘whether the
complainant is a multichannel video
programming distributor or video
programming vendor, and, in the case of
a multichannel video programming
distributor, identify the type of
multichannel video programming
distributor, the address and telephone
number of the complainant, what type
of multichannel video programming
distributor the defendant is, and the
address and telephone number of each
defendant.’’
12. Evidence supporting a program
carriage claim may be based on an
explicit or implicit threat.22 In
complaints alleging a violation of the
exclusivity or financial interest
provisions, the complaint must contain
direct evidence (either documentary or
testimonial) supporting the facts
underlying the claim. For example, a
complainant alleging that an MVPD has
coerced a programming vendor to grant
exclusive carriage rights or required a
financial interest in a program service
must provide documentary evidence,
such as an e-mail from the defendant
MVPD, documenting the prohibited
action, or an affidavit from a
representative of the programming
vendor involved in the relevant carriage
negotiations detailing the facts
supporting the alleged violation of the
program carriage rules.
22 See 1993 Program Carriage Order, 9 FCC Rcd
at 2650, para. 18 (‘‘[W]e reject TCI’s suggestion that
we should require evidence of explicit threats,
because we believe that actual threats may not
always comprise a necessary condition for a finding
of coercion. Requiring such evidence would
establish an unreasonably high burden of proof that
could undermine the intent of section 616 by
allowing multichannel distributors to engage in bad
faith negotiations that apparently would not violate
the statute and our regulations simply because
explicit threats were not made during such
negotiations. In contrast, we believe that section
616(a)(2) was intended to prohibit implicit as well
as explicit behavior that amounts to ‘coercion.’ ’’).
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13. For complaints alleging a violation
of the discrimination provision,
however, direct evidence supporting a
claim that the defendant MVPD
discriminated ‘‘on the basis of affiliation
or non-affiliation’’ is sufficient to
establish this element of a prima facie
case but is not required. For example, an
e-mail from the defendant MVPD stating
that the MVPD took an adverse carriage
action against the programming vendor
because it is not affiliated with the
MVPD will generally be sufficient to
establish this element of a prima facie
case. However, such documentary
evidence is highly unlikely to be
available to a programming vendor in
advance of discovery, and may not exist
at all.23 In addition, an affidavit from a
representative of the programming
vendor involved in the relevant carriage
negotiations detailing the facts
supporting a claim that a representative
of the defendant MVPD informed the
vendor that the MVPD took an adverse
carriage action because the vendor is not
affiliated with the MVPD will generally
be sufficient to establish this element of
a prima facie case. Again, however, we
recognize that such direct evidence of
affiliation-based discrimination will
seldom be available to complainants
and is not required to establish this
element of a prima facie case.
14. Because it is unlikely that direct
evidence of a discriminatory motive will
be available to potential complainants,24
we clarify that a complainant can
establish this element of a prima facie
case of a violation of the program
carriage discrimination provision by
providing the following circumstantial
evidence of discrimination ‘‘on the basis
of affiliation or non-affiliation.’’ First,
the complainant programming vendor
must provide evidence that it provides
video programming that is similarly
situated to video programming provided
23 See Hallmark Channel Reply at 10
(‘‘[D]iscrimination is often subtle, and the evidence
of its existence is likely outside the control of an
independent programmer.’’); NFL Enterprises Reply
at 5–6 (‘‘[T]he best evidence of discriminatory
motive is under the exclusive control of the MVPD
* * *. [V]ertically integrated MVPDs are
determined not to provide potential complainants
with direct evidence of the underlying purpose of
their discriminatory conduct.’’).
24 See NFL Enterprises Reply at 6 (stating that
requiring only documentary evidence of improper
motive before a programmer can file a complaint
‘‘would make it extremely difficult to bring any
complaint, since * * * vertically integrated MVPDs
are skillful at ensuring that the best evidence of
discrimination—and the only evidence of
discriminatory intent—is found only in the control
of the MVPD’’); Outdoor Channel Nov. 16 2007 Ex
Parte Letter at 2 (‘‘Because evidence of predatory
intent is commonly controlled by the MVPD, and
not the programmer, it is unrealistic to expect a
programmer to have clear evidence of predation
before it can bring a claim.’’).
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by a programming vendor affiliated with
the defendant MVPD,25 based on a
combination of factors, such as genre,
ratings, license fee, target audience,
target advertisers, target programming,26
and other factors.27 We emphasize that
a finding at the prima facie stage that
affiliated and unaffiliated video
programming is similarly situated
should be based on examination of a
combination of factors put forth by the
complainant. Although no single factor
is necessarily dispositive, the more
factors that are found to be similar, the
more likely the programming in
question will be considered similarly
situated to the affiliated programming.
On the other hand, it is unlikely that
programming would be considered
‘‘similarly situated’’ if only one of these
factors is found to be similar. For
example, a complainant is unlikely to
establish a prima facie case of
25 In the 1993 Program Carriage Order, the
Commission interpreted the discrimination
provision in section 616(a)(3) to require a
complainant alleging discrimination that favors an
‘‘affiliated’’ programming vendor to provide
evidence that the defendant MVPD has an
attributable interest in the allegedly favored
‘‘affiliated’’ programming vendor. See 1993 Program
Carriage Order, 9 FCC Rcd at 2654, para. 29 (‘‘For
complaints alleging discriminatory treatment that
favors ‘affiliated’ programming vendors, the
complainant must provide evidence that the
defendant has an attributable interest in the
allegedly favored programming vendor, as set forth
in § 76.1300(a).’’); see also 47 CFR 76.1300(a) (‘‘For
purposes of this subpart, entities are affiliated if
either entity has an attributable interest in the other
or if a third party has an attributable interest in both
entities.’’); Review of the Commission’s Cable
Attribution Rules, Report and Order, 14 FCC Rcd
19014, 19063, para. 132 n.333 (1999) (amending
definition of ‘‘affiliated’’ in the program carriage
rules to be consistent with definition of this term
in other cable rules); but see NPRM in MB Docket
No. 11–131, paras. 72–77 (seeking comment on
whether to interpret the discrimination provision in
section 616(a)(3) more broadly to preclude a
vertically integrated MVPD from discriminating on
the basis of a programming vendor’s lack of
affiliation with another MVPD).
26 By ‘‘target programming,’’ we refer to
programming rights that a video programming
vendor seeks to acquire to display on its network.
27 The Media Bureau will assess on a case-by-case
basis whether the complaint contains evidence to
establish at the prima facie stage that the affiliated
and unaffiliated video programming is similarly
situated. In previous cases assessing at the prima
facie stage whether the complaint contains evidence
that the affiliated and unaffiliated video
programming is similarly situated, the Media
Bureau has assessed similar factors. See Tennis
Channel HDO, 25 FCC Rcd at 14159–60, paras. 17–
18; Herring Broadcasting Inc., d/b/a WealthTV, et
al., Memorandum Opinion and Hearing Designation
Order, 23 FCC Rcd 14787, 14795–97, paras. 12–17
(MB 2008) (‘‘WealthTV HDO’’); NFL Enters. LLC v.
Comcast Cable Communications, LLC,
Memorandum Opinion and Hearing Designation
Order, 23 FCC Rcd 14787, 14822–23, para. 75 (MB
2008) (‘‘NFL Enterprises HDO’’); TCR Sports
Broadcasting Holding, LLP, d/b/a Mid-Atlantic
Sports Network v. Comcast Corp., Memorandum
Opinion and Hearing Designation Order, 23 FCC
Rcd 14787, 14835–36, para. 108 (MB 2008) (‘‘MASN
II HDO’’).
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discrimination on the basis of affiliation
by demonstrating that the defendant
MVPD carries an affiliated music
channel targeted to younger viewers but
has declined to carry an unaffiliated
music channel targeted to older viewers
with lower ratings and a higher license
fee. Second, the complaint must contain
evidence that the defendant MVPD has
treated the video programming provided
by the complainant programming
vendor differently than the similarly
situated video programming provided
by the programming vendor affiliated
with the defendant MVPD with respect
to the selection, terms, or conditions for
carriage.28 In the absence of direct
evidence supporting the claim that the
defendant MVPD discriminated ‘‘on the
basis of affiliation or non-affiliation,’’
the circumstantial evidence discussed
here will establish this element of a
prima facie case of a violation of the
program carriage discrimination
provision.
15. In addition, we note that the
program carriage discrimination
provision prohibits only conduct that
has ‘‘the effect of * * * unreasonably
restrain[ing] the ability of an
unaffiliated video programming vendor
to compete fairly.’’ Thus, regardless of
whether the complainant relies on
direct or circumstantial evidence of
discrimination ‘‘on the basis of
affiliation or non-affiliation,’’ the
complaint must also contain evidence
that the defendant MVPD’s conduct has
the effect of unreasonably restraining
the ability of the complainant
programming vendor to compete
fairly.29
jlentini on DSK4TPTVN1PROD with RULES3
28 See
Tennis Channel HDO, 25 FCC Rcd at
14160–61, para. 19; WealthTV HDO, 23 FCC Rcd at
14797, para. 18, 14801, para. 28, 14806, para. 40,
14812, para. 52; NFL Enterprises HDO, 23 FCC Rcd
at 14823, para. 76; MASN II HDO, 23 FCC Rcd at
14836, para. 109; MASN I HDO, 21 FCC Rcd at
8993–94, para. 11; but see Hutchens
Communications, Inc. v. TCI Cablevision of
Georgia, Inc., Memorandum Opinion and Order, 9
FCC Rcd 4849, 4853, para. 27 (CSB 1994) (finding
that complainant programming vendor did not
make a prima facie showing of discrimination on
the basis of affiliation because it failed to
demonstrate that it was offered different price,
terms, or conditions as compared to that offered to
an affiliated programming vendor).
29 See 1993 Program Carriage Order, 9 FCC Rcd
at 2648, para. 14 (citing 47 U.S.C. 536(a)(3)). The
Media Bureau will assess on a case-by-case basis
whether the complaint contains evidence at the
prima facie stage to establish that the effect of the
defendant MVPD’s conduct is to unreasonably
restrain the ability of the complainant video
programming vendor to compete fairly. In previous
cases, the Media Bureau has made this assessment
based on the impact of the defendant MVPD’s
adverse carriage action on the programming
vendor’s subscribership, licensee fee revenues,
advertising revenues, ability to compete for
advertisers and programming, and ability to realize
economies of scale. See Tennis Channel HDO, 25
FCC Rcd at 14161–62, paras. 20–21; WealthTV
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16. We emphasize that a Media
Bureau finding that a complainant has
established a prima facie case does not
mean that the complainant has proven
its case or any elements of its case on
the merits. Rather, a prima facie finding
means that the complainant has
provided sufficient evidence in its
complaint, without the Media Bureau
having considered any evidence to the
contrary, to proceed. If the complainant
establishes a prima facie case but the
record is not sufficient to resolve the
complaint, the adjudicator (i.e., either
the Media Bureau or an ALJ) will allow
the parties to engage in discovery 30 and
will then conduct a de novo
examination of all relevant evidence on
each factual and legal issue. For
example, although the Media Bureau
may find that a complaint contains
sufficient evidence to establish a prima
facie case that a defendant MVPD’s
conduct has the effect of unreasonably
restraining the ability of the
complainant programming vendor to
compete fairly, thus allowing the case to
proceed, the adjudicator when ruling on
the merits may reach an opposite
conclusion after conducting further
proceedings and developing a more
complete evidentiary record.31
HDO, 23 FCC Rcd at 14798, para. 19, 14802, paras.
29–31, 14807–08, paras. 41–42, 14812–13, paras.
53–54; NFL Enterprises HDO, 23 FCC Rcd at 14823–
25, paras. 77–78; MASN II HDO, 23 FCC Rcd at
14836, para. 110; MASN I HDO, 21 FCC Rcd at
8993–94, para. 11.
30 Under the current program carriage rules,
discovery is Commission-controlled, meaning that
Media Bureau staff identifies the matters for which
discovery is needed and then issues letters of
inquiry to the parties on those matters or requires
the parties to produce specific documents related to
those matters. See 1993 Program Carriage Order, 9
FCC Rcd at 2655–56, para. 32; see also id. at 2652,
para. 23 (providing that discovery will ‘‘not
necessarily be permitted as a matter of right in all
cases, but only as needed on a case-by-case basis,
as determined by the staff’’); see also 47 CFR 76.7(f).
In the NPRM in MB Docket No. 11–131, we propose
to revise these procedures by providing for
expanded discovery, whereby parties to a program
carriage complaint may serve requests for discovery
directly on opposing parties rather than relying on
the Media Bureau staff to seek discovery through
letters of inquiry or document requests. See NPRM
in MB Docket No. 11–131, paras. 42–43. We also
seek comment on an automatic document
production process whereby both parties would
have a certain period of time after the Media
Bureau’s prima facie determination to produce
basic threshold documents listed in the
Commission’s rules that are relevant to the program
carriage claim at issue. See NPRM in MB Docket No.
11–131, paras. 44–47.
31 Compare WealthTV HDO, 23 FCC Rcd 14787
with Herring Broadcasting Inc., d/b/a WealthTV, et
al., Recommended Decision, 24 FCC Rcd 12967
(Chief ALJ Sippel 2009) (‘‘WealthTV Recommended
Decision’’) and Herring Broadcasting Inc., d/b/a
WealthTV, et al., Memorandum Opinion and Order,
FCC 11–94 (2011) (‘‘WealthTV Commission
Order’’). We note, however, the Media Bureau in
the course of making a prima facie determination
may rule on the merits of certain elements of the
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17. We also clarify that the Media
Bureau’s determination of whether a
complainant has established a prima
facie case is based on a review of the
complaint (including any attachments)
only. If the Media Bureau determines
that the complainant has established a
prima facie case, the Media Bureau will
then review the answer (including any
attachments) and reply to determine
whether there are procedural defenses
that might warrant dismissal of the case
(e.g., arguments pertaining to the statute
of limitations); whether there are any
issues that the defendant MVPD
concedes; whether there are substantial
and material questions of fact as to
whether the defendant MVPD has
engaged in conduct that violates the
program carriage rules; whether the case
can be addressed by the Media Bureau
on the merits based on the pleadings or
whether further evidentiary proceedings
are necessary; and whether the
proceeding should be referred to an ALJ
in light of the nature of the factual
disputes. For example, if the Media
Bureau determines that the complainant
has established a prima facie case but
the defendant MVPD provides
legitimate and non-discriminatory
business reasons in its answer for its
adverse carriage decision, the Media
Bureau might conclude that there are
substantial and material questions of
fact that warrant allowing the parties to
engage in discovery or referring the
matter to an ALJ for an adjudicatory
hearing, or it might conclude that the
complaint can be resolved on the merits
based on the pleadings.
B. Deadline for Defendant’s Answer to a
Program Carriage Complaint
18. Our current rule provides that an
MVPD served with a program carriage
complaint shall answer the complaint
within 30 days of service. We amend
this rule to provide an MVPD with 60
days to answer a program carriage
complaint.32 Having established specific
evidentiary requirements for what the
complainant must provide in its
case based on the pleadings and refrain from
referring these specific issues for further evidentiary
proceedings. For example, to the extent that the
parties concede that the complainant is a video
programming vendor and the defendant is an
MVPD, further evidentiary proceedings on these
issues are unnecessary.
32 See Letter from Ryan G. Wallach, Counsel for
Comcast, to Marlene H. Dortch, Secretary, FCC, MB
Docket No. 07–42 (Dec. 10, 2008), Attachment at 2
(urging the Commission to allow defendants 60
days to file an answer); Letter from Arthur H.
Harding, Counsel for Time Warner Cable, to
Marlene H. Dortch, Secretary, FCC, MB Docket No.
07–42 (June 1, 2011), at 2 (stating that a program
carriage defendant needs a full and fair opportunity
to respond to a complaint) (‘‘Time Warner Cable
June 1 2011 Ex Parte Letter’’).
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complaint to establish a prima facie case
of a program carriage violation, we
believe it is appropriate to provide the
defendant with additional time to
answer the complaint in order to
develop a full, case-specific response,
with supporting evidence, to the
evidence put forth by the complainant.
As discussed in the next section,
Congress directed the Commission to
‘‘provide for expedited review’’ of
program carriage complaints, and we
adopt deadlines herein for the Media
Bureau and ALJs when acting on
program carriage complaints to satisfy
this requirement. Providing additional
time for a defendant to file an Answer
to a complaint does not conflict with
this requirement. By requiring a
complainant to provide specific
evidence in its complaint and providing
a defendant with additional time to
respond to this evidence and provide
specific evidence supporting its
response, the rules we adopt today will
allow for the development of a more
robust factual record earlier in the
complaint process than under our
current rules. We believe that this will
better enable the Media Bureau to either
resolve cases on the merits based on the
pleadings without referring the matter to
an ALJ, or narrow the factual issues in
dispute that warrant discovery or
referral to an ALJ. As a result, this will
lead to the more expeditious resolution
of disputes than under other current
program carriage complaint procedures.
jlentini on DSK4TPTVN1PROD with RULES3
C. Deadlines for Media Bureau and ALJ
Decisions
19. The record reflects that the
unpredictable and sometimes lengthy
time frames for Commission action on
program carriage complaints have
discouraged programming vendors from
filing complaints.33 Both programming
vendors 34 and MVPDs support
33 See TAC Comments at 9 (‘‘Faced with the
likelihood of FCC inaction, combined with the real
risk of retaliation by cable operators, [] no
independent channel would want to file with the
FCC.’’); HDNet June 16 2010 Ex Parte Letter at 5
(‘‘Independent programmers simply cannot
commence proceedings against potential carriers,
even in cases of clear misconduct, unless these
proceedings are truly expedited, as Congress
directed, because they risk retaliation and, for some
independent programmers, financially ruinous
delays in acquiring carriage for their
programming.’’); see also BTNC Comments at 4.
34 See TAC Comments at 9 (requesting that the
Commission provide a ‘‘shot clock,’’ such as a
requirement that the Commission hear and resolve
the complaint within 60 to 90 days); NFL
Enterprises Reply at 8 (explaining that, given the
time-sensitivity of program carriage disputes, it is
critical that the Commission adopt a streamlined
complaint process and an expedited timeline for
dispute resolution); HDNET Reply at 1 (endorsing
an expedited complaint resolution process);
WealthTV Reply at 1 (same); see also NAMAC
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expeditious action on program carriage
complaints. We believe that establishing
deadlines for the Media Bureau and
ALJs when acting on program carriage
complaints will help to resolve disputes
quickly and efficiently and thus fulfill
our statutory mandate to ‘‘provide for
expedited review’’ of program carriage
complaints. While the Commission in
the 1993 Program Carriage Order
directed both the Media Bureau and
ALJs to resolve cases ‘‘expeditiously,’’
we now conclude that a specific
deadline codified in our rules is needed
to ensure that this goal is achieved.35
20. Action on program carriage
complaints entails a two-step process:
The initial prima facie determination by
the Media Bureau, followed (if
necessary) by a decision on the merits
by an adjudicator (i.e., either the Media
Bureau or an ALJ).36 We adopt
deadlines herein for both of these steps.
For the first step, we direct the Media
Bureau to release a decision
determining whether the complainant
has established a prima facie case
within 60 calendar days after the
complainant’s reply to the defendant’s
answer is filed (or the date on which the
reply would be due if none is filed).
Based on our past experience in
addressing program carriage complaints,
we believe that 60 calendar days after
the complainant files its reply 37
Comments at 18; ION Dec. 11 2008 Ex Parte Letter,
Attachment at 1; NAIN June 5 2008 Ex Parte Letter,
Attachment at 1; HDNet July 22 2008 Ex Parte
Letter (attaching Letter from U.S. Sen. Herb Kohl to
Kevin J. Martin, Chairman, FCC (June 23, 2008) at
2 (‘‘I urge that the FCC set a deadline by which
program carriage complaints by programmers be
decided in prompt and reasonable time * * *.’’));
id. (attaching Letter from U.S. Sen. Byron L. Dorgan
to Kevin J. Martin, Chairman, FCC (June 13, 2008)
at 1 (‘‘I worry that while the FCC has a shot clock
for consideration of forbearance petitions, in a
separate area of programming discrimination, the
Commission lacks any type of timeline.’’)); id.
(attaching Letter from U.S. Reps. Gene Green, Mike
Doyle, and Charles Gonzalez to Kevin J. Martin,
Chairman, FCC (June 30, 2008) at 2 (urging the
Commission to adopt a ‘‘shot clock’’)).
35 See 1993 Program Carriage Order, 9 FCC Rcd
at 2655–56, para. 32 (directing Media Bureau staff
to ‘‘develop a discovery process and timetable to
resolve the dispute expeditiously’’); see id. at 2656,
para. 34 (‘‘ALJs are expected to resolve program
carriage complaints expeditiously, and should hold
an immediate status conference to establish
timetables for discovery, hearing and submission of
briefs and proposed findings of fact and
conclusions of law.’’).
36 A potential third step applies to the extent a
party appeals the decision of the Media Bureau or
an ALJ to the Commission. See 47 CFR 1.115,
76.10(c)(1) (pertaining to Applications for Review of
actions taken on delegated authority); 47 CFR 1.276,
76.10(c)(2) (pertaining to exceptions to initial
decisions of an ALJ). We decline at this time to
establish a deadline for Commission action on
review of decisions by the Media Bureau or an ALJ.
37 As amended herein, the program carriage rules
provide for a 80-calendar-day initial pleading cycle
(i.e., a 60-calendar-day period for filing an answer
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provides sufficient time for the Media
Bureau to make a prima facie
determination while providing for the
‘‘expedited review’’ required by
Congress. In light of this expedited
timeframe for the Media Bureau’s prima
facie determination, we again
emphasize that complainants should not
raise new matters in a reply 38 and that
additional pleadings outside of the
pleading cycle will not be accepted.39
21. For the second step, we impose
different deadlines for a ruling on the
merits of the complaint depending upon
whether the adjudicator is the Media
Bureau or an ALJ. After the Media
Bureau concludes that the complaint
contains sufficient evidence to establish
a prima facie case, the Media Bureau
has three options for addressing the
merits of the complaint: (i) The Media
Bureau can rule on the merits of the
complaint based on the pleadings
without discovery; 40 (ii) if the Media
Bureau determines that the record is not
sufficient to resolve the complaint, the
Media Bureau may outline procedures
for discovery before proceeding to rule
on the merits of the complaint; 41 or (iii)
if the Media Bureau determines that
disposition of the complaint or discrete
issues raised in the complaint requires
resolution of factual disputes or other
extensive discovery in an adjudicatory
proceeding, the Media Bureau will refer
the proceeding or discrete issues arising
in the proceeding for an adjudicatory
to a complaint and a 20-calendar-day period for
filing a reply to the answer). See 47 CFR
76.1302(e)(1), (f).
38 See 47 CFR 76.1302(e) (stating that a reply
‘‘shall be responsive to matters contained in the
answer and shall not contain new matters’’).
39 See 1993 Program Carriage Order, 9 FCC Rcd
at 2652, para. 23 (‘‘Given the statute’s explicit
direction to the Commission to handle program
carriage complaints expeditiously, additional
pleadings will not be accepted or entertained unless
specifically requested by the reviewing staff.’’); see
id. at 2654–55, para. 30 n.51 (‘‘[U]nless specifically
requested by the Commission or its staff, additional
pleadings such as motions to dismiss or motions for
summary judgment will not be considered. We
intend to keep pleadings to a minimum to comply
with the statutory directive for an expedited
adjudicatory process.’’) (emphasis in original).
40 See id. at 2652, para. 23 (‘‘[W]e hereby adopt
a system that promotes resolution of as many cases
as possible on the basis of a complaint, answer and
reply.’’); but see id. at 2652, para. 24 (‘‘As a
practical matter, however, given that alleged
violations of section 616, especially those involving
potentially ‘coercive’ practices, will require an
evaluation of contested facts and behavior related
to program carriage negotiations, we believe that the
staff will be unable to resolve most program carriage
complaints on the sole basis of a written record as
described above. Rather, we anticipate that
resolution of most program carriage complaints will
require an administrative hearing to evaluate
contested facts related to the parties’ specific
negotiations.’’).
41 See id. at 2655–56, paras. 31–33; see also 47
CFR 76.7(f).
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hearing before an ALJ.42 We establish
the following deadlines for the
adjudicator’s decision on the merits. For
complaints that the Media Bureau
decides on the merits based on the
pleadings without discovery, the Media
Bureau must release a decision within
60 calendar days after its prima facie
determination. We believe this
timeframe is sufficient to allow the
Media Bureau to review the record and
draft and release a decision on the
merits. For complaints that the Media
Bureau decides on the merits after
discovery is conducted, the Media
Bureau must release a decision within
150 calendar days after its prima facie
determination. We believe this
timeframe is sufficient to allow for the
entry of a protective order, discovery,
and the submission of supplemental
briefs and other information required by
the Media Bureau, as well as for the
Media Bureau to review the record and
draft and release a decision on the
merits. For complaints referred to an
ALJ for a decision on the merits, we
believe that a longer timeframe is
warranted to allow for, among other
things, the preparation for and conduct
of a fair hearing, the submission of
proposed findings of fact and
conclusions of law, and the ALJ’s
preparation of an initial decision and, if
necessary, formulation of a remedy.
Accordingly, we direct the ALJ to
release an initial decision within 240
calendar days after one of the parties
informs the Chief ALJ that it elects not
to pursue ADR or, if the parties have
mutually elected to pursue ADR, within
240 calendar days after the parties
inform the Chief ALJ that they have
failed to resolve their dispute through
ADR.43 To the extent that the Media
Bureau refers only discrete issues raised
in the proceeding to the ALJ rather than
the entire proceeding, we expect that
the ALJ will be able to act in less than
240 calendar days. We note that the
Commission has previously stated that
‘‘[t]ime limits on the ALJs are
permissible so long as they do not
unduly interfere with a judge’s
independence to control the course of
the proceeding * * * or subject the
42 See 1993 Program Carriage Order, 9 FCC Rcd
at 2652, para. 24 and 2656, para. 34; see also 47 CFR
76.7(g)(1). In cases referred to an ALJ, the parties
have ten days after the Media Bureau’s prima facie
determination to elect whether to attempt to resolve
their dispute through ADR. See 47 CFR 76.7(g)(2);
see also 1993 Program Carriage Order, 9 FCC Rcd
at 2652, para. 24 and 2656, para. 34.
43 § 76.7(g)(2) of the Commission’s rules currently
states that a party must submit in writing to the
Commission its election as to whether to proceed
to ADR. See 47 CFR 76.7(g)(2). We amend this rule
to further specify that this election must also be
submitted with the Chief ALJ.
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judge to performance appraisals.’’ 44 We
do not believe that the 240-calendar-day
deadline adopted herein will unduly
interfere with the ALJ’s independence,
and this deadline will not be used for
performance appraisals.45
22. We also amend certain procedural
deadlines applicable to adjudicatory
hearings to reflect that an adjudicatory
hearing involving a program carriage
complaint does not commence until a
party elects not to pursue ADR pursuant
to § 76.7(g)(2) or, if the parties have
mutually elected to pursue ADR, the
parties fail to resolve their dispute
through ADR. We also adopt expedited
deadlines to account for the 240calendar-day deadline for the ALJ’s
initial decision. First, we revise the
deadline for filing a written appearance
in a program carriage matter referred to
an ALJ. Section 1.221(c) of the
Commission’s rules provides that a
written appearance must be filed within
20 days of the mailing of the HDO. We
amend this rule to provide that, in a
program carriage complaint proceeding
that the Media Bureau refers to an ALJ,
a party must file a written appearance
within five calendar days after the party
informs the Chief ALJ that it elects not
to pursue ADR or, if the parties have
mutually elected to pursue ADR, within
five calendar days after the parties
inform the Chief ALJ that they have
44 See Proposals to Reform the Commission’s
Comparative Hearing Process to Expedite the
Resolution of Cases, Report and Order, 5 FCC Rcd
157, para. 40 n.26 (1990) (citing Butz v. Economou,
438 U.S. 478, 513 (1978) and 5 CFR 930.211) (‘‘1990
Comparative Hearing Order’’).
45 We note that only one previous ALJ decision
has addressed the merits of a program carriage
complaint. See WealthTV Recommended Decision.
In that case, the ALJ reached a decision one year
after the Media Bureau’s HDO. We do not believe
this timeframe is necessarily reflective of the time
required to reach a decision on the merits of a
program carriage complaint given the unique
circumstances of this case, including the following:
(i) The case consolidated four separate complaints
involving the same complainant against four
separate defendant MVPDs; and (ii) the proceeding
was delayed by the Media Bureau’s decision to take
back jurisdiction over the case, which was
subsequently rescinded by the Commission. See
Herring Broadcasting Inc., d/b/a WealthTV, et al.,
Memorandum Opinion and Order, 23 FCC Rcd
18316 (MB 2008), rescinded by Herring
Broadcasting Inc., d/b/a WealthTV, et al., Order, 24
FCC Rcd 1581 (2009). Although the type and
complexity of cases referred to ALJs vary
considerably, we note that the ALJ has ruled within
approximately 240 calendar days after referral in
previous cases. See Under His Direction, Inc., Initial
Decision, 11 FCC Rcd 16831 (ALJ Luton 1996)
(approximately eight months from HDO to ALJ’s
decision); AJI Broad., Inc., Initial Decision, 11 FCC
Rcd 19756 (ALJ Luton 1996) (approximately eight
months from HDO to ALJ’s decision); Community
Educ. Ass’n, Initial Decision, 10 FCC Rcd 3179 (ALJ
Chachkin 1995) (approximately eight months from
HDO to ALJ’s decision); Aurio A. Matos, Initial
Decision, 8 FCC Rcd 7920 (ALJ Gonzalez 1993)
(approximately seven months from HDO to ALJ’s
decision).
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60659
failed to resolve their dispute through
ADR. Because the parties would have
already been involved in a complaint
proceeding before the Media Bureau
resulting in the prima facie
determination and will have had the
opportunity to retain counsel for
litigating the complaint before the
Media Bureau, we believe that reducing
the time for filing a written appearance
in a program carriage matter referred to
an ALJ from 20 to five days is
reasonable. We also amend our rules to
specify the consequences of failing to
timely file a written appearance in a
program carriage matter referred to an
ALJ. If the complainant fails to file a
written appearance by this deadline, or
fails to file prior to the deadline either
a petition to dismiss the proceeding
without prejudice or a petition to
accept, for good cause shown, a written
appearance beyond such deadline, the
Chief ALJ shall dismiss the complaint
with prejudice for failure to prosecute.
If the defendant fails to file a written
appearance by this deadline, or fails to
file prior to this deadline a petition to
accept, for good cause shown, a written
appearance beyond such deadline, its
opportunity to present evidence at
hearing will be deemed to have been
waived. If the hearing is so waived, the
Chief ALJ will terminate the proceeding
and certify to the Commission the
complaint for resolution based on the
existing record. Second, we revise the
deadline for filing a motion to enlarge,
change, or delete issues. Section
1.229(a) provides that a motion to
enlarge, change, or delete issues shall be
filed within 15 days after the HDO is
published in the Federal Register. We
amend this rule to provide that, in a
program carriage complaint proceeding
that the Media Bureau refers to an ALJ,
a motion to enlarge, change, or delete
issues shall be filed within 15 calendar
days after the deadline for filing a
written notice of appearance. Third, we
revise the deadline for holding an initial
prehearing conference. Section 1.248 of
the Commission’s rules provides that, to
the extent an initial prehearing
conference is scheduled, it shall be
scheduled 30 days after the effective
date of the HDO, unless good cause is
shown for scheduling the conference at
a later date. We amend this rule to
provide that, to the extent the ALJ in a
program carriage complaint proceeding
conducts an initial prehearing
conference, the conference shall be held
no later than ten calendar days after the
deadline for filing a written notice of
appearance, or within such shorter or
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longer period as the ALJ may allow
consistent with the public interest.46
23. We believe that the deadlines
established herein for a decision by the
Media Bureau or an ALJ on a program
carriage complaint provide sufficient
time for the adjudicator to reach a
decision on the merits while also
providing for the ‘‘expedited review’’
required by Congress and ensuring
fairness to all parties.47 We will allow
the adjudicator to toll these deadlines
only under certain circumstances. First,
the adjudicator can toll a deadline if the
parties jointly request tolling in order to
pursue settlement discussions or ADR
or for any other reason that the parties
mutually agree justifies tolling.48
Second, the adjudicator may toll a
deadline if complying with the deadline
would violate the due process rights of
a party or would be inconsistent with
fundamental fairness. Finally, in
extraordinary situations, tolling a
deadline may be necessary in light of
the adjudicatory resources available at
the time in the Office of Administrative
Law Judges. The Commission has a
number of alternatives under such
circumstances to ensure expedited
review, but a brief tolling of deadlines
may be required in pending hearing
cases. To the extent an ALJ decides to
toll the deadline, we emphasize that this
interlocutory decision will not be
appealable to the Commission as a
matter of right. Rather, pursuant to
§ 1.301(b) of the Commission’s rules, an
46 We note that the parties may commence
discovery before the prehearing conference is held.
See 47 CFR 1.311(c)(2).
47 We note that the Commission in the 1993
Program Carriage Order rejected a 90-day deadline
for resolution of program carriage complaints. See
1993 Program Carriage Order, 9 FCC Rcd at 2655,
para. 32 n.52. We continue to believe that a 90-day
deadline is impractical, but the longer deadlines
established herein are realistic given our experience
with program carriage cases since 1993. We also
note that the Commission previously declined to
adopt revised deadlines for resolving program
access complaints, stating that ‘‘overly accelerated
pleading and discovery time periods can lead to
increased litigation costs if the parties are required
to hire additional staff and counsel in attempting
to meet unrealistic deadlines.’’ See Review of the
Commission’s Program Access Rules and
Examination of Programming Tying Arrangements,
MB Docket No. 07–198, Report and Order, 22 FCC
Rcd 17791, 17857, para. 108 (2007) (‘‘2007 Program
Access Order’’). We find these concerns are not
presented here because the deadlines we adopt for
resolving program carriage complaints are not
‘‘overly accelerated’’ or unrealistic.
48 For example, if the parties jointly request to toll
the Media Bureau’s 60-calendar-day deadline for
reaching a prima facie determination to pursue
settlement discussions or ADR, the Media Bureau
will toll the deadline until the parties jointly inform
the Media Bureau that efforts to resolve the dispute
were unsuccessful. Similarly, if the parties jointly
request to toll the deadline for reaching a decision
on the merits, the adjudicator will toll the deadline
until the parties jointly inform the adjudicator that
efforts to resolve the dispute were unsuccessful.
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appeal to the Commission of an ALJ’s
decision to toll the deadline shall be
filed only if allowed by the ALJ. To the
extent the ALJ does not allow an appeal,
or if no permission to file an appeal is
requested, an objection to the ALJ’s
decision to toll the deadline may be
raised on review of the ALJ’s initial
decision.
24. Taken together, the 80-calendarday initial pleading cycle, the 60calendar-day deadline for a prima facie
determination, the 10-calendar-day ADR
election period in cases referred to an
ALJ, and the 60- or 150-calendar-day (in
cases decided by the Media Bureau,
depending on whether discovery is
conducted) or 240-calendar-day (in
cases decided by an ALJ) deadline for a
ruling on the merits mean that program
carriage complaints will be resolved
within approximately seven or ten
months (in cases decided by the Media
Bureau, depending on whether
discovery is conducted) or thirteen
months (in cases decided by an ALJ)
after a complaint is filed, assuming that
the parties do not elect ADR or seek to
toll the deadlines. While these
timeframes are longer than our
aspirational goals for resolving program
access complaints,49 we believe these
time frames are necessary given the
often fact-intensive nature of program
carriage claims, which will often focus
on the details of the negotiation process
and similarities and differences in
programming.50
D. Temporary Standstill of Existing
Contract Pending Resolution of a
Program Carriage Complaint
25. We establish specific procedures
for the Media Bureau’s consideration of
requests for a temporary standstill of the
price, terms, and other conditions of an
existing programming contract by a
program carriage complainant seeking
renewal of such a contract. The
procedures we adopt herein mirror the
procedures adopted previously for
temporary standstills involving program
access complaints.51 The record reflects
49 See 2007 Program Access Order, 22 FCC Rcd
at 17857, para. 108 (retaining goal of resolving
program access complaints within five months from
the submission of a complaint for denial of
programming cases, and nine months for all other
program access complaints, such as price
discrimination cases).
50 See Comcast Comments at 31–33 (arguing that
program carriage cases are more complex than
program access cases).
51 See 47 CFR 76.1003(l); Review of the
Commission’s Program Access Rules and
Examination of Programming Tying Arrangements,
First Report and Order, 25 FCC Rcd 746, 794–797,
paras. 71–75 (2010) (‘‘2010 Program Access
Order’’), vac’d in part, Cablevision Sys. Corp. v.
FCC, 2011 WL 2277217 (D.C. Cir. June 10, 2011).
Comcast contends that the Commission ‘‘should be
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that, absent a standstill, an MVPD will
have the ability to retaliate against a
programming vendor that files a
legitimate complaint by ceasing carriage
of the programming vendor’s video
programming, thereby harming the
programming vendor as well as viewers
who have come to expect to be able to
view that video programming.52
Moreover, absent a standstill,
programming vendors may feel
compelled to agree to the carriage
demands of MVPDs, even if these
demands violate the program carriage
rules, in order to maintain carriage of
video programming in which they have
made substantial investments. While
some MVPDs may offer month-to-month
extensions after expiration of a carriage
contract, programming vendors explain
that such extensions may lead to
uncertainty for viewers and
programming vendors and impede the
ability of programming vendors to
attract financing.
26. The Supreme Court has affirmed
the Commission’s authority to impose
interim injunctive relief, in the form of
a standstill order, pursuant to section
wary’’ of importing a standstill adopted for program
access complaints into the program carriage context
because, unlike the program access context where
a network is under an obligation not to withhold
the network from an MVPD, there is no duty to
carry a network in the program carriage context. See
Letter from David P. Murray, Counsel for Comcast,
to Marlene H. Dortch, Secretary, FCC, MB Docket
No. 07–42 (July 25, 2011), at 3 n.9 (‘‘Comcast July
25 2011 Ex Parte Letter’’). In fact, the Commission
adopted a program access standstill requirement for
both satellite-delivered and terrestrially delivered
networks, despite the fact that a terrestrially
delivered network is under no obligation to refrain
from withholding the network from an MVPD in the
absence of a Commission order. See 2010 Program
Access Order, 25 FCC Rcd at 794, para. 71. We also
note that there are important parallels between the
program access and program carriage regimes,
inasmuch as both are based on concerns with the
impact of vertical integration on competition in the
video distribution and video programming markets.
Moreover, Comcast ignores the fact that the program
carriage regime may also impose a duty on an
MVPD to carry a programming vendor if the MVPD
otherwise refuses to do so on the basis of affiliation
or non-affiliation.
52 See WealthTV Aug. 4 2008 Ex Parte Letter
(attaching Letter from U.S. Sen. Amy Klobuchar to
Kevin J. Martin, Chairman, FCC (July 24, 2008) at
1 (‘‘Independent programming providers continue
to express concern that continued uncertainties and
delays create a chilling effect on their willingness
to bring discrimination complaints, because of their
fear of potential retaliation by MVPDs while a
complaint remains pending.’’)); HDNet Nov. 20
2007 Ex Parte Letter at 2 (‘‘An MVPD could retaliate
by allowing the clock to run and harmful
uncertainty about the unaffiliated video
programming provider to mount, or even by
allowing the arrangement to expire and then
removing the unaffiliated video programming
provider from the platform.’’); see also NAIN June
5 2008 Ex Parte Letter, Attachment at 1; Letter from
David S. Turetsky, Counsel for HDNet LLC, to
Marlene H. Dortch, Secretary, FCC, MB Docket No.
07–42 (June 4, 2008) at 2.
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4(i).53 The Commission recently relied
on this authority in adopting standstill
procedures for program access cases.
Under section 4(i), the Commission is
authorized to ‘‘make such rules and
regulations * * * as may be necessary
in the execution of its functions,’’ and
to ‘‘[m]ake such rules and regulations
* * * not inconsistent with law, as may
be necessary to carry out the provisions
of this Act.’’ 54 Accordingly, the
Commission has statutory authority to
impose a temporary standstill of an
existing contract in appropriate cases
pending resolution of a program carriage
complaint. While a complainant could
request, and the Commission or Media
Bureau could issue, a standstill order in
a program carriage complaint
proceeding under the same standards
described in this order without the new
procedures adopted herein, we believe
that codifying uniform procedures will
help to expedite action on standstill
requests and provide guidance to
complainants and MVPDs.55
53 United States v. Southwestern Cable Co., 392
U.S. 157, 181 (1968); see also AT&T Corp. v.
Ameritech Corp., Memorandum Opinion and Order,
13 FCC Rcd 14508 (1998) (standstill order issued
pursuant to 47 U.S.C. 154(i) temporarily preventing
Ameritech from enrolling additional customers in,
and marketing and promoting, a ‘‘teaming’’
arrangement with Qwest Corporation pending a
decision concerning the lawfulness of the program);
Formal Complaints Order, 12 FCC Rcd at 22566,
para. 159 and n.464 (1997) (stating that the
Commission has authority under section 4(i) of the
Act to award injunctive relief); Time Warner Cable,
Order on Reconsideration, 21 FCC Rcd 9016 (MB
2006) (standstill order issued pursuant to section
4(i) denying a stay and reconsideration of the Media
Bureau’s order requiring Time Warner temporarily
to reinstate carriage of the NFL Network on systems
that it recently acquired from Adelphia
Communications and Comcast Corporation until the
Commission could resolve on the merits the
Emergency Petition for Declaratory Ruling filed by
the NFL).
54 47 U.S.C. 154(i), 303(r). In contract to the
retransmission consent context, there is no statutory
provision with which the Commission-ordered
standstill of a program carriage agreement would be
inconsistent. See 47 U.S.C. 325(b)(1)(A) (‘‘No cable
system or other multichannel video programming
distributor shall retransmit the signal of a
broadcasting station, or any part thereof, except–
(A) with the express authority of the originating
station’’); Amendment of the Commission’s rules
Related to Retransmission Consent, MB Docket No.
10–71, Notice of Proposed Rulemaking, 26 FCC Rcd
2718, 2727–29, paras. 18–19 (2011)
(‘‘Retransmission Consent NPRM’’) (concluding that
section 325(b) prevents the Commission from
ordering interim carriage over the objection of the
broadcaster, even upon a finding of a violation of
the good faith negotiation requirement, and seeking
comment on this conclusion).
55 NCTA has suggested that section 624(f)(1) of
the Communications Act, which generally prohibits
any Federal agency, State, or franchising authority
from imposing ‘‘requirements regarding the
provision or content of cable services, except as
expressly provided in this title,’’ precludes all
temporary standstill orders in the context of a
program carriage complaint proceeding. 47 U.S.C.
544(f)(1); see Letter from Rick Chessen, NCTA, to
Marlene H. Dortch, Secretary, FCC, MB Docket No.
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27. Pursuant to the rules we adopt
herein, a program carriage complainant
seeking renewal of an existing
programming contract, under which
programming is then being provided,
may submit along with its complaint a
petition for a temporary standstill of its
programming contract pending
resolution of the complaint.56 We
encourage complainants to file the
petition and complaint sufficiently in
07–42 (July 1, 2011) (‘‘NCTA July 1 2011 Ex Parte
Letter’’); see also Comcast July 25 2011 Ex Parte
Letter at 1–2. We disagree. Section 616(a) expressly
directs the Commission to ‘‘establish regulations
governing program carriage agreements and related
practices.’’ 47 U.S.C. 536(a). Further, a temporary
standstill order could be found necessary to prevent
the likely occurrence of one of the practices
expressly prohibited in section 616(a). See 47
U.S.C. 536(a)(1)–(3). Moreover, we note that section
624(f)(1) is directed at the ‘‘provision or content of
cable services’’ and thus by its terms does not apply
to other types of MVPD services, such as direct
broadcast satellite service. 47 U.S.C. 544(f)(1). We
need not, and do not, decide whether section
624(f)(1) would bar granting temporary injunctive
relief in the program carriage context in some
circumstances. Instead, we ask for comment on that
issue in the accompanying NPRM in MB Docket No.
11–131.
We also reject Comcast’s claim that the
Commission cannot rely on section 4(i) as authority
for granting a standstill because section 616(a)(5) of
the Act and § 76.1302(g)(1) of the Commission’s
rules prevent the Commission from imposing
remedies or penalties unless and until a violation
of section 616 has been found after an adjudication
on the merits. See Comcast July 25 2011 Ex Parte
Letter at 1–2 (citing 47 U.S.C. 536(a)(5) (requiring
the Commission to establish regulations
‘‘provid[ing] for appropriate penalties and remedies
for violations of this subsection, including
carriage’’); 47 CFR 76.1302(g)(1) (‘‘Upon completion
of such adjudicatory proceeding, the Commission
shall order appropriate remedies * * *.’’); AT&T
Co. v. FCC, 487 F.2d 865, 874–76 (2d Cir. 1973)).
As an initial matter, as noted above, the
Commission has longstanding authority to grant
injunctive relief pursuant to section 4(i) and
recently relied on that authority in adopting
standstill procedures for program access cases. We
do not believe that the provisions cited by Comcast
preclude the Commission from imposing interim
injunctive relief upon an appropriate showing.
Indeed, the Commission relied on section 4(i) in
adopting a standstill procedure for program access
complaints despite language in the program access
provisions of the Act and the Commission’s rules
similar to the language cited by Comcast. See 47
U.S.C. 548(e)(1) (‘‘Upon completion of such
adjudicatory proceeding, the Commission shall
have the power to order appropriate remedies
* * *.’’); 47 CFR 76.1003(h)(1) (‘‘Upon completion
of such adjudicatory proceeding, the Commission
shall order appropriate remedies * * *.’’).
56 We note that program carriage claims involving
existing contracts do not arise solely at renewal.
The Media Bureau has previously found at the
prima facie stage of review that a complainant may
have a timely program carriage claim in the middle
of a contract term if the basis for the claim is an
allegedly discriminatory decision made by the
MVPD that the contract left to the MVPD’s
discretion. See Tennis Channel HDO, 25 FCC Rcd
at 14154–59, paras. 11–16; see also NFL Enterprises
HDO, 23 FCC Rcd at 14819–20, paras. 69–70; MASN
II HDO, 23 FCC Rcd at 14833–35, paras. 102–105.
We will consider the availability of a standstill
outside of the renewal context on a case-by-case
basis.
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advance of the expiration of the existing
contract, and in no case later than 30
days prior to such expiration, to provide
the Media Bureau with sufficient time to
act prior to expiration. In its petition,
the complainant must demonstrate how
grant of the standstill will meet the
following four criteria: (i) The
complainant is likely to prevail on the
merits of its complaint; (ii) the
complainant will suffer irreparable
harm absent a stay; (iii) grant of a stay
will not substantially harm other
interested parties; and (iv) the public
interest favors grant of a stay.57 As part
of a showing of irreparable harm, a
complainant may discuss, among other
things, the impact on subscribers and
the extent to which the programming
vendor’s advertising and license fee
revenues and its ability to compete for
advertisers and programming will be
adversely affected absent a standstill.58
57 See, e.g., Virginia Petroleum Jobbers Ass’n v.
FPC, 259 F.2d 921, 925 (D.C. Cir. 1958); see also
Washington Metropolitan Area Transit Comm’n v.
Holiday Tours, 559 F.2d 841 (D.C. Cir. 1977)
(clarifying the standard set forth in Virginia
Petroleum Jobbers Ass’n v. FPC); Hispanic
Information and Telecomm. Network, Inc., 20 FCC
Rcd 5471, 5480, para. 26 (2005) (affirming Bureau’s
denial of request for stay on grounds applicant
failed to establish four criteria demonstrating stay
is warranted). We reject Comcast’s claim that the
first criterion requires a showing of a ‘‘substantial’’
likelihood of success on the merits. See Comcast
July 25 2011 Ex Parte Letter at 3. The factors set
forth above are consistent with Supreme Court
precedent (Winter v. Natural Resources Defense
Council, Inc., 555 U.S. 7 (2008)) and a recent D.C.
Circuit case applying Winter. See Winter, 505 U.S.
at 20 (‘‘A plaintiff seeking a preliminary injunction
must establish that he is likely to succeed on the
merits, that he is likely to suffer irreparable harm
in the absence of preliminary relief, that the balance
of equities tips in his favor, and that an injunction
is in the public interest.’’) (emphasis added;
citations omitted); Sherley v. Sebelius, 2011 WL
1599685, *4 (D.C. Cir. Apr. 29, 2011) (quoting and
applying the Winter test). We also reject Comcast’s
claim that a program carriage standstill is a
‘‘mandatory injunction’’ subject to a heightened
standard because it will not preserve the status quo
but will instead extend the term of a contract set
to expire on an agreed-upon date and form a new,
government-mandated contract. See Comcast July
25 2011 Ex Parte Letter at 2. As discussed above,
we require a complainant to file a standstill request
at least 30 days prior to the expiration of a contract
to allow the Media Bureau with sufficient time to
act prior to expiration. Accordingly, despite
Comcast’s claims, a program carriage standstill, if
granted, will preserve the status quo by requiring
continued carriage of a network that is being carried
at the time the standstill is granted.
58 Comcast claims that a complainant is unlikely
to meet the requirements for a standstill because (i)
Under the first factor, it is unlikely that the facts
will be developed at the standstill stage to
demonstrate a likelihood of success on the merits,
at least with respect to program carriage complaints
alleging discrimination based on circumstantial
evidence; (ii) under the second factor, irreparable
harm cannot be established when there is an
adequate remedy at law, which Comcast claims
exists through a mandatory carriage remedy after a
finding of a program carriage violation; and (iii)
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In order to ensure an expedited
decision, the defendant will have ten
calendar days after service to file an
answer to the petition for a standstill
order. In acting on the petition, the
Media Bureau may limit the length of
the standstill to a defined period or may
specify that the standstill will continue
until the adjudicator resolves the
underlying program carriage complaint.
The adjudicator may lift the temporary
standstill to the extent that it finds that
the stay is having a negative effect on
settlement negotiations or is otherwise
no longer in the public interest.
28. If the Media Bureau grants the
temporary standstill, the adjudicator
ruling on the merits of the complaint
(i.e., either the Media Bureau or an ALJ)
will apply the terms of the new
agreement between the parties, if any, as
of the expiration date of the previous
agreement. For example, if carriage of
the video programming has continued
uninterrupted during resolution of the
complaint, and if the decision on the
merits requires the defendant MVPD to
pay a higher amount to the
programming vendor than was required
under the terms of the expired contract,
the defendant MVPD will make an
additional payment to the programming
vendor in an amount representing the
difference between the amount that is
required to be paid pursuant to the
decision and the amount the defendant
MVPD paid under the terms of the
expired contract pending resolution of
the complaint. Conversely, if carriage of
the video programming has continued
uninterrupted during resolution of the
complaint, and if the decision on the
merits requires the defendant MVPD to
pay a lesser amount to the programming
under the third factor, forced carriage would result
in substantial harm to MVPDs by violating their
First Amendment rights. See Comcast July 25 2011
Ex Parte Letter at 4–5. The Media Bureau will have
the opportunity to consider these arguments when
assessing the facts and circumstances presented in
a standstill request on a case-by-case basis. We find
no basis to deny complainants the opportunity to
pursue a standstill in the program carriage context
simply because of the potential difficulty in
satisfying the requirements for a standstill. In this
regard, we note that ‘‘injunctive relief [is] an
extraordinary remedy that may only be awarded
upon a clear showing that the plaintiff is entitled
to such relief.’’ Winter, 505 U.S. at 21 (citation
omitted); see also 2010 Program Access Order, 25
FCC Rcd at 795, para. 73 n.266 (‘‘‘when a party
seeks injunctive relief (which is precisely what a
standstill is), the law is clear that this is a request
for ‘extraordinary relief,’ and courts therefore
require such party to demonstrate, on a case-by-case
basis with a sufficient evidentiary record, that it
satisfies’ the criteria set forth in Virginia Petroleum
Jobbers Ass’n)’’) (quoting with approval Time
Warner Comments at 14 n.42); Sky Angel, 25 FCC
Rcd 3879, 3884, para. 10 (MB 2010) (‘‘we are unable
to conclude that Sky Angel has met its burden of
demonstrating that the extraordinary relief of a
standstill order is warranted’’).
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vendor than was required under the
terms of the expired contract, the
programming vendor will credit the
defendant MVPD with an amount
representing the difference between the
amount actually paid under the terms of
the expired contract during resolution of
the complaint and the amount that is
required to be paid pursuant to the
decision.
29. We note that program carriage
complaints do not entail solely price
disputes. Rather, complaints may entail
the issue of whether the MVPD should
be required to carry a programming
vendor’s video programming at all or
whether the MVPD should carry the
video programming on a specific tier. In
these cases, it may be difficult to apply
the new terms to the standstill period,
especially in cases where the
adjudicator does not ultimately order
carriage. Despite these complications,
we believe that the adjudicator can
address these issues on a case-by-case
basis. To facilitate expeditious
resolution of these issues, we propose in
the NPRM in MB Docket No. 11–131
specific procedures to assist an
adjudicator to reach a fair and just
result.
30. As explained in the 2010 Program
Access Order, we expect parties to deal
and negotiate with one another in good
faith to come to settlement while the
program carriage complaint is pending
at the Commission. We also note that
the standstill requirement imposed in
connection with previous merger
conditions is automatic upon notice of
the MVPD’s intent to arbitrate, whereas
the process we adopt here requires a
complainant to seek Commission
approval based on the four-criteria test
described above.59 Thus, the
Commission will be able to take into
account all relevant facts in each case.
Moreover, because the new carriage
terms will be applied as of the
expiration date of the previous contract,
we believe that complainants will not
have an incentive to seek a temporary
standstill solely to benefit from the
status quo or to gain leverage.60
59 See supra para. 27; see also Time Warner Cable
June 1 2011 Ex Parte Letter at 2 (‘‘An MVPD should
remain free to exercise its contractual rights to drop
or reposition a programmer who has filed a program
carriage complaint unless the Commission
determines that the traditional factors for granting
a stay are satisfied.’’).
60 Comcast claims that the possibility of a
program carriage standstill presents practical and
policy problems, such as affecting existing business
negotiations; making it riskier for MVPDs to agree
to carry new or less popular networks given the
potential for a standstill request to be filed at the
end of the carriage term; and making it more likely
that parties will fail to reach agreement by allowing
only programming vendors to request a standstill.
See Comcast July 25 2011 Ex Parte Letter at 5–7.
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E. Constitutional Issues
31. Our efforts in this Second Report
and Order to create an improved
program carriage complaint regime are
consistent with constitutional
requirements. TWC argues that the
constitutionality of the program carriage
rules has never been tested under the
First and Fifth Amendments. TWC
argues that, to the extent the goal of the
program carriage rules is to promote
diversity of speech, the rules are
content-based and thus subject to strict
scrutiny, which requires a ‘‘compelling’’
government interest and ‘‘narrow
tailoring.’’ Diversity, however, is not the
sole or even primary goal of the program
carriage provision. Rather, through the
program carriage provision, Congress
also specifically intended to promote
competition in both the video
programming market and the video
distribution market. Indeed, the
program carriage discrimination
provision specifically requires the
Commission to assess on a case-by-case
basis whether conduct amounting to
discrimination on the basis of affiliation
has the effect of ‘‘unreasonably
restrain[ing] the ability of an
unaffiliated video programming vendor
to compete fairly.’’ By favoring its
affiliated programming vendor on the
basis of affiliation, an MVPD can hinder
the ability of an unaffiliated
programming vendor to compete in the
video programming market, thereby
allowing the affiliated programming
vendor to charge higher license fees and
reducing competition in the markets for
the acquisition of advertising and
programming rights.
32. The D.C. Circuit has already
decided that the leased access provision
of the 1992 Cable Act is not contentbased. The court held that the leased
access provision does not favor or
disfavor speech on the basis of the ideas
In making these claims, Comcast ignores the fact
that a complainant could request, and the
Commission or Media Bureau could issue, a
standstill order in a program carriage complaint
proceeding today under the same procedures
adopted herein. Thus, all of the alleged practical
and policy problems raised by Comcast exist today
and are not created by these procedural rules.
Moreover, the procedural rules we adopt herein
will help to mitigate these alleged practical and
policy problems. By setting forth the standard that
will be applied to a program carriage standstill
request and establishing specific deadlines for
submitting and responding to such a request, we
provide certainty to both complainants and MVPDs
with respect to the standstill process. While
Comcast claims that requiring a complainant to file
a standstill request no later than 30 days prior to
the expiration of a contract will chill business
negotiations by placing parties in litigation before
a contract ends (see id. at 6), the fact is that, without
the procedures we adopt herein, a program carriage
standstill request could be filed at any time, thereby
creating greater uncertainty for MVPDs.
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contained therein; rather, it regulates
speech based on affiliation with a cable
operator. The same conclusion applies
to the program carriage provision of the
1992 Cable Act, which prevents MVPDs
from demanding exclusivity or financial
interests from, or discriminating on the
basis of affiliation with respect to,
unaffiliated programming vendors and,
accordingly, regulates speech based on
affiliation with an MVPD, not based on
its content. The court held in Time
Warner that the provisions of the 1992
Cable Act that regulate speech based on
affiliation are subject to intermediate
scrutiny and are constitutional if the
government’s interest is important or
substantial and the means chosen to
promote that interest do not burden
substantially more speech than
necessary to achieve the aim. The Time
Warner court found that there are
substantial government interests in
promoting diversity and competition in
the video programming market.61 The
program carriage rules, like the leased
access requirements, promote diversity
in video programming by promoting fair
treatment of unaffiliated programming
vendors and providing these vendors
with an avenue to seek redress of
anticompetitive carriage practices of
MVPDs. Moreover, because MVPDs
have an incentive to shield their
affiliated programming vendors from
competition with unaffiliated
programming vendors for viewers,
advertisers, and programming rights, the
program carriage rules promote
competition in the video programming
market by promoting fair treatment of
unaffiliated programming vendors.
Thus, like the leased access rules, the
program carriage rules would be subject
to, and would withstand, intermediate
scrutiny.
33. TWC argues that whatever
justification existed for the program
carriage provisions at the time they were
adopted no longer exists today. Despite
TWC’s claim to the contrary, we find
that the substantial government interests
in promoting diversity and competition
remain. TWC notes that the number of
all national programming networks has
grown since 1992; 62 the percentage of
61 See id. (stating that after Turner, ‘‘promoting
the widespread dissemination of information from
a multiplicity of sources’’ and ‘‘promoting fair
competition in the market for television
programming’’ must be treated as important
governmental objectives unrelated to the
suppression of speech (quoting Turner Broad. Sys.,
Inc. v. FCC, 512 U.S. 622 (1994))).
62 See TWC Comments at 8; Comcast Reply at 5;
compare H.R. Rep. No. 102–628, at 41 (1992) (68
nationally delivered cable networks) with Annual
Assessment of the Status of Competition in the
Market for the Delivery of Video Programming,
Thirteenth Annual Report, 24 FCC Rcd 542, 550–
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these networks affiliated with cable
operators has decreased; 63 channel
capacity has increased, thereby
providing more room for unaffiliated
programming vendors, and cable
operators face more competition in the
distribution market today than in
1992.64 In the program carriage
discrimination provision, however,
Congress directed the Commission to
assess on a case-by-case basis the impact
of anticompetitive conduct on an
unaffiliated programming vendor’s
ability to compete. These nationwide
figures do not undermine Congress’s
finding that cable operators and other
MVPDs have the incentive and ability to
favor their affiliated programming
vendors in individual cases, with the
potential to unreasonably restrain the
ability of an unaffiliated programming
vendor to compete fairly. While the D.C.
Circuit in vacating the Commission’s
horizontal ownership cap stated that
‘‘[c]able operators * * * no longer have
the bottleneck power over programming
that concerned the Congress in 1992,’’
the court in that case was reviewing a
broad prophylactic rule that would limit
individual cable operators to a
maximum percentage of subscribers
nationwide. Unlike the rule at issue in
that case, the program carriage statute
requires an assessment of the facts of
each case and the impact on the ability
of an unaffiliated programming vendor
to compete fairly. In addition, we note
that the number of cable-affiliated
networks recently increased
significantly after the merger of Comcast
and NBC Universal, thereby
highlighting the continued need for an
effective program carriage complaint
regime. The Commission noted that that
transaction would ‘‘result in an entity
with increased ability and incentive to
harm competition in video
programming by engaging in foreclosure
strategies or other discriminatory
actions against unaffiliated video
51, para. 24 (2009) (‘‘13th Annual Report’’) (based
on data from 2006, finding that there are 565
nationally delivered cable networks).
63 See TWC Comments at 8; Comcast Reply at 5;
compare H.R. Rep. No. 102–628, at 41 (1992)
(stating that 57 percent of nationally delivered cable
networks are affiliated with cable operators) with
13th Annual Report, 24 FCC Rcd at 550–51, para.
24 (based on data from 2006, finding that 14.9
percent of nationally delivered cable networks are
affiliated with cable operators).
64 See id. at ii and 9–10 (stating that competition
in the distribution market requires a cable operator
to make programming decisions ‘‘based on business
and editorial judgments as to whether particular
channels meet the needs and interests of the
operator’s subscribers and to attempt to maximize
consumer value by making the best deal possible in
arm’s length negotiations’’); see also Comcast Reply
at 5, 28 n.100, 30.
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programming networks.’’ 65 The
Commission specifically relied upon the
program carriage complaint process to
address these concerns.
34. Moreover, the program carriage
rules are no broader than necessary
because the Commission will find a
violation of the rules only after
conducting a proceeding in which the
complaining unaffiliated programming
vendor or MVPD proves that an MVPD
has demanded exclusivity from a
programming vendor, has demanded a
financial interest in a programming
vendor, or has discriminated against the
programming vendor on the basis of
affiliation and that such discrimination
has unreasonably restrained the
programming vendor’s ability to
compete fairly. Thus, the program
carriage rules burden no more speech
than necessary to vindicate the
government’s goal of protecting
competition and diversity.
35. We also reject TWC’s claim that
the program carriage rules infringe cable
operators’ rights under the Takings
Clause of the Fifth Amendment.
Quoting Dolan v. City of Tigard, 512
U.S. 374, 386 (1994), TWC argues that,
‘‘[g]iven the existence of a fiercely
competitive landscape fostering the
development of diverse programming
sources, there is no ‘essential nexus’ or
‘rough proportionality’ that would
justify the taking that occurs under the
* * * program carriage rules.’’ TWC’s
reliance on Dolan is misplaced, as the
‘‘essential nexus’’ test concerns land use
regulations that allegedly impose
‘‘unconstitutional conditions’’ and is
inapplicable here.66 None of the factors
that the Supreme Court has identified as
particularly significant in evaluating
regulatory takings claims supports
TWC’s claim.67 First, the program
65 See id. at 4284–85, para. 116; see also id. at
4282, para. 110 (‘‘We agree that the vertical
integration of Comcast’s distribution network with
NBCU’s programming assets will increase the
ability and incentive for Comcast to discriminate
against or foreclose unaffiliated programming.’’).
66 See Dolan, 512 U.S. at 385–86; see also id. at
390 (Fifth Amendment requirement of ‘‘rough
proportionality’’ applies where government requires
a landowner to dedicate private land for some
future public use in exchange for a discretionary
benefit such as a building permit).
67 See Connolly v. Pension Ben. Guaranty Corp.,
475 U.S. 211, 224–25 (1986) (‘‘In all of these cases,
we have eschewed development of any set formula
for identifying a ‘taking’ forbidden by the Fifth
Amendment, and have relied instead on ad hoc,
factual inquiries into the circumstances of each
particular case. To aid in this determination,
however, we have identified three factors which
have particular significance: (1) The economic
impact of the regulation on the claimant; (2) the
extent to which the regulation has interfered with
distinct investment-backed expectations; and (3) the
character of the governmental action.’’) (citations
and internal quotes omitted), quoted in Exclusive
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carriage rules merely prohibit a cable
operator from requiring a financial
interest in a video programming vendor
as a condition for carriage, from
coercing a video programming vendor to
provide exclusivity as a condition of
carriage, or from discriminating on the
basis of affiliation that unreasonably
restrains the ability of unaffiliated video
programming vendors to compete fairly.
The program carriage provision of the
Act, as well as our rules implementing
that provision, do not compel a cable
operator to carry certain programming,
nor do they specify the rates for
carriage. Second, the rules, which have
been in force since 1993 and were
required by Congress in 1992, do not
interfere with any current investmentbacked expectations. Third, the rules
substantially advance the legitimate
governmental interest in promoting
competition and diversity in the video
programming market, an interest that
Congress has directed the Commission
to vindicate and that the courts have
recognized as important. Finally, our
examination of the record in this
proceeding refutes the premise of TWC’s
argument that the program carriage rules
serve no purpose in light of the current
state of competition in the video
programming market. Thus, the rules do
not effect a ‘‘taking’’ within the meaning
of the Fifth Amendment.
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F. Adequate Notice
36. We reject arguments that the
Program Carriage NPRM failed to
provide the specificity required under
the Administrative Procedure Act
(‘‘APA’’) and that the Commission must
issue another notice before adopting
final rules. Sections 553(b) and (c) of the
APA require agencies to give public
notice of a proposed rule making that
includes ‘‘either the terms or substance
of the proposed rule or a description of
the subjects and issues involved’’ and to
give interested parties an opportunity to
submit comments on the proposal. Such
notice is not, however, required for
rules involving agency procedure. The
standstill procedures and the revised
procedural rules adopted herein,
including extending the deadline for a
defendant to file an answer to a
complaint, are rules of agency
procedure for which no notice is
required under the APA.68 When notice
Service Contracts for Provision of Video Services in
Multiple Dwelling Units and Other Real Estate
Developments, Report and Order and Further
Notice of Proposed Rulemaking, 22 FCC Rcd 20235,
20262, para. 56 (2007) (‘‘MDU Exclusives Order’’),
aff’d sub nom. Nat’l Cable & Telecomm. Ass’n v.
FCC, 567 F.3d 659 (D.C. Cir. 2009).
68 While Comcast claims that the procedures we
adopt herein for a program carriage standstill will
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is required under the APA, the notice
‘‘need not specify every precise
proposal which [the agency] may
ultimately adopt as a rule’’; it need only
‘‘be sufficient to fairly apprise interested
parties of the issues involved.’’ In
particular, the APA’s notice
requirements are satisfied where the
final rule is a ‘‘logical outgrowth’’ of the
actions proposed. Here, the Program
Carriage NPRM specifically sought
comment on, among other questions,
‘‘whether the elements of a prima facie
case should be clarified,’’ ‘‘whether
specific time limits on the Commission,
cable operators, or others would
promote a speedy and just resolution’’
of program carriage disputes, and
‘‘whether the Commission should adopt
rules to address the complaint process
itself.’’ But in any event, with respect to
the standstill procedures, the
Commission specifically sought
comment on whether to ‘‘adopt
additional rules to protect programmers
from potential retaliation if they file a
complaint.’’ As discussed above, the
standstill procedure will help to prevent
retaliation while a program carriage
complaint is pending, and thus is a
‘‘logical outgrowth’’ of this proposal.69
have ‘‘substantive effects,’’ the fact is that these
procedures codify the process for requesting a
standstill that a complainant could request, and the
Commission or Media Bureau could issue, today
without the new procedures adopted herein. See
Comcast July 25 2011 Ex Parte Letter at 7; supra
n.60. Any ‘‘substantive effects’’ resulting from the
filing and consideration of a program carriage
standstill request exist today and are not affected
by the procedures we adopt herein. See JEM Broad.
Co. v. FCC, 22 F.3d 320, 326 (D.C. Cir. 1994)
(Commission’s ‘‘hard look’’ rules were procedural
because they ‘‘did not change the substantive
standards by which the Commission evaluates
license applications’’); Bachow Commc’ns, Inc. v.
FCC, 237 F.3d 683 (D.C. Cir. 2001) (Commission
cut-off date for certain amendments to pending
applications was procedural); Neighborhood TV Co.
v. FCC, 742 F.2d 629 (D.C. Cir. 1984) (Commission
interim processing rules were procedural); Kessler
v. FCC, 326 F.2d 673 (1963) (same); Ranger v. FCC,
294 F.2d 240, 243–44 (D.C. Cir. 1961) (Commission
cut-off date for filing applications was procedural).
The procedures we adopt herein do not alter the
existence or scope of any substantive rights, but
simply codify a pre-existing procedure for obtaining
equitable relief to vindicate those rights. Any
alleged burden stemming from a procedural rule is
not sufficient to convert the rule into a substantive
one that requires notice and comment. See, e.g.,
James V. Hurson Assocs, Inc. v. Glickman, 229 F.3d
277, 281 (D.C. Cir. 2000) (‘‘even if the [agency’s]
elimination of [the procedural rule] did impose a
substantial burden * * *, that burden would not
convert the rule into a substantive one that triggers
the APA’s notice-and-comment requirement * * *.
[A]n otherwise-procedural rule does not become a
substantive one, for notice-and-comment purposes,
simply because it imposes a burden on regulated
parties.’’).
69 See supra para. 25. The fact that the
Commission may have been more explicit in
seeking comment on a standstill process in other
contexts does not undermine the fact that the
program carriage standstill procedures are rules of
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IV. Procedural Matters
G. Congressional Review Act
37. The Commission will send a copy
of this Second Report and Order in a
report to be sent to Congress and the
Government Accountability Office
pursuant to the Congressional Review
Act, see 5 U.S.C. 801(a)(1)(A).
H. Final Regulatory Flexibility Analysis
Final Regulatory Flexibility Act
Analysis
1. As required by the Regulatory
Flexibility Act of 1980, as amended
(‘‘RFA’’),70 an Initial Regulatory
Flexibility Analysis (‘‘IRFA’’) was
incorporated in the Notice of Proposed
Rulemaking in MB Docket No. 07–42
(hereinafter referred to as the Program
Carriage NPRM).71 The Commission
sought written public comment on the
proposals in the Program Carriage
NPRM, including comment on the IRFA.
This present Final Regulatory Flexibility
Analysis (‘‘FRFA’’) conforms to the
RFA.72
A. Need for, and Objectives of, the
Proposed Rule Changes
2. In 1993, the Commission adopted
rules implementing a provision of the
1992 Cable Act 73 pertaining to carriage
of video programming vendors by
multichannel video programming
distributors (‘‘MVPDs’’) intended to
benefit consumers by promoting
competition and diversity in the video
programming and video distribution
markets (the ‘‘program carriage’’
rules).74 As required by Congress, these
agency procedure for which no notice is required
under the APA and, in any event, are a logical
outgrowth of the request for comment on rules to
protect programmers from retaliation. See Comcast
July 25 2011 Ex Parte Letter at 7 (citing
Retransmission Consent NPRM, 26 FCC Rcd at
2727–29, paras. 18–19 and Review of the
Commission’s Program Access Rules and
Examination of Programming Tying Arrangements,
Notice of Proposed Rulemaking, 22 FCC Rcd 17791,
17868–70, paras. 136–138 (2007)).
70 See 5 U.S.C. 603. The RFA, see 5 U.S.C. 601–
612, has been amended by the Small Business
Regulatory Enforcement Fairness Act of 1996
(‘‘SBREFA’’), Public Law 104–121, Title II, 110 Stat.
857 (1996).
71 See Leased Commercial Access; Development
of Competition and Diversity in Video Programming
Distribution and Carriage, MB Docket No. 07–42,
Notice of Proposed Rule Making, 22 FCC Rcd
11222, 11231–40, Appendix (2007) (‘‘Program
Carriage NPRM’’).
72 See 5 U.S.C. 604.
73 See Cable Television Consumer Protection and
Competition Act of 1992, Public Law 102–385, 106
Stat. 1460 (1992) (‘‘1992 Cable Act’’); see also 47
U.S.C. 536.
74 See Implementation of Sections 12 and 19 of
the Cable Television Consumer Protection and
Competition Act of 1992, Development of
Competition and Diversity in Video Programming
Distribution and Carriage, MM Docket No. 92–265,
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rules allow for the filing of complaints
with the Commission alleging that an
MVPD has (i) Required a financial
interest in a video programming
vendor’s program service as a condition
for carriage (the ‘‘financial interest’’
provision); (ii) coerced a video
programming vendor to provide, or
retaliated against a vendor for failing to
provide, exclusive rights as a condition
of carriage (the ‘‘exclusivity’’ provision);
or (iii) unreasonably restrained the
ability of an unaffiliated video
programming vendor to compete fairly
by discriminating in video programming
distribution on the basis of affiliation or
nonaffiliation of vendors in the
selection, terms, or conditions for
carriage (the ‘‘discrimination’’
provision). Congress specifically
directed the Commission to provide for
‘‘expedited review’’ of these complaints
and to provide for appropriate penalties
and remedies for any violations.
Programming vendors have complained
that the Commission’s procedures for
addressing program carriage complaints
have hindered the filing of legitimate
complaints and have failed to provide
for the expedited review envisioned by
Congress. In the Second Report and
Order in MB Docket No. 07–42, the
Commission takes the following initial
steps to improve its procedures for
addressing program carriage complaints.
3. First, in response to concerns that
programming vendors are uncertain as
to what evidence must be provided in
a complaint to establish a prima facie
case of a program carriage violation, the
Commission codifies in its rules the
evidence required to establish a prima
facie case.75 A prima facie finding
means that the complainant has
provided sufficient evidence in its
complaint, without the Media Bureau
having considered any evidence to the
contrary, to proceed to a ruling on the
merits. The Second Report and Order in
MB Docket No. 07–42 explains that, in
complaints alleging a violation of the
exclusivity or financial interest
provisions, the complaint must contain
direct evidence (either documentary or
testimonial) supporting the facts
underlying the claim. For complaints
alleging a violation of the
Second Report and Order, 9 FCC Rcd 2642 (1993)
(‘‘1993 Program Carriage Order’’); see also
Implementation of the Cable Television Consumer
Protection And Competition Act of 1992,
Development of Competition and Diversity in Video
Programming Distribution and Carriage, MM
Docket No. 92–265, Memorandum Opinion and
Order, 9 FCC Rcd 4415 (1994) (‘‘1994 Program
Carriage Order’’). The Commission’s program
carriage rules are set forth at 47 CFR 76.1300—
76.1302.
75 See Second Report and Order in MB Docket
No. 07–42 at paras. 9–17.
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discrimination provision, however,
direct evidence supporting a claim that
the defendant MVPD discriminated ‘‘on
the basis of affiliation or non-affiliation’’
is sufficient to establish this element of
a prima facie case but is not required.
Because it is unlikely that direct
evidence of a discriminatory motive will
be available to potential complainants,
the Second Report and Order in MB
Docket No. 07–42 clarifies that a
complainant can establish this element
of a prima facie case of a violation of the
program carriage discrimination
provision by providing the following
circumstantial evidence of
discrimination ‘‘on the basis of
affiliation or non-affiliation’’: (i) The
complainant programming vendor must
provide evidence that it provides video
programming that is similarly situated
to video programming provided by a
programming vendor affiliated with the
defendant MVPD, based on a
combination of factors, such as genre,
ratings, license fee, target audience,
target advertisers, target programming,
and other factors; and (ii) the complaint
must contain evidence that the
defendant MVPD has treated the video
programming provided by the
complainant programming vendor
differently than the similarly situated
video programming provided by the
programming vendor affiliated with the
defendant MVPD with respect to the
selection, terms, or conditions for
carriage. In addition, regardless of
whether the complainant relies on
direct or circumstantial evidence of
discrimination ‘‘on the basis of
affiliation or non-affiliation,’’ the
complaint must also contain evidence
that the defendant MVPD’s conduct has
the effect of unreasonably restraining
the ability of the complainant
programming vendor to compete fairly.
4. Second, having established specific
evidentiary requirements for what the
complainant must provide in its
complaint to establish a prima facie case
of a program carriage violation, the
Second Report and Order provides the
defendant with additional time to
answer the complaint in order to
develop a full, case-specific response,
with supporting evidence, to the
evidence put forth by the complainant.
Specifically, while the Commission’s
current rule provides that an MVPD
served with a program carriage
complaint shall answer the complaint
within 30 days of service, the Second
Report and Order amends this rule to
provide an MVPD with 60 days to
answer the complaint.
5. Third, in response to concerns that
the unpredictable and sometimes
lengthy time frames for Commission
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action on program carriage complaints
have discouraged programming vendors
from filing legitimate complaints, the
Commission establishes deadlines for
action by the Media Bureau and
Administrative Law Judges (‘‘ALJ’’)
when acting on program carriage
complaints. Action on program carriage
complaints entails a two-step process:
the initial prima facie determination by
the Media Bureau, followed (if
necessary) by a decision on the merits
by an adjudicator (i.e., either the Media
Bureau or an ALJ). For the first step, the
Commission in the Second Report and
Order in MB Docket No. 07–42 directs
the Media Bureau to release a decision
determining whether the complainant
has established a prima facie case
within 60 calendar days after the
complainant’s reply to the defendant’s
answer is filed (or the date on which the
reply would be due if none is filed). For
the second step, the Commission
imposes different deadlines for a ruling
on the merits of the complaint
depending upon whether the
adjudicator is the Media Bureau or the
ALJ. After the Media Bureau concludes
that the complaint contains sufficient
evidence to establish a prima facie case,
the Media Bureau has three options for
addressing the merits of the complaint:
(i) The Media Bureau can rule on the
merits of the complaint based on the
pleadings without discovery; (ii) if the
Media Bureau determines that the
record is not sufficient to resolve the
complaint, the Media Bureau may
outline procedures for discovery before
proceeding to rule on the merits of the
complaint; or (iii) if the Media Bureau
determines that disposition of the
complaint or discrete issues raised in
the complaint requires resolution of
factual disputes or other extensive
discovery in an adjudicatory
proceeding, the Media Bureau will refer
the proceeding or discrete issues arising
in the proceeding for an adjudicatory
hearing before an ALJ. The Commission
in the Second Report and Order in MB
Docket No. 07–42 establishes the
following deadlines for the adjudicator’s
decision on the merits. For complaints
that the Media Bureau decides on the
merits based on the pleadings without
discovery, the Media Bureau must
release a decision within 60 calendar
days after its prima facie determination.
For complaints that the Media Bureau
decides on the merits after discovery,
the Media Bureau must release a
decision within 150 calendar days after
its prima facie determination. For
complaints referred to an ALJ for a
decision on the merits, the ALJ must
release an initial decision within 240
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calendar days after one of the parties
informs the Chief ALJ that it elects not
to pursue Alternative Dispute
Resolution (‘‘ADR’’) or, if the parties
have mutually elected to pursue ADR,
within 240 calendar days after the
parties inform the Chief ALJ that they
have failed to resolve their dispute
through ADR. In adopting this deadline
for program carriage complaints referred
to an ALJ, the Second Report and Order
in MB Docket No. 07–42 also adopts
revised procedural deadlines applicable
to adjudicatory hearings involving
program carriage complaints. The
deadlines for the Media Bureau or an
ALJ to reach a decision may be tolled
only under the following circumstances:
(i) If the parties jointly request tolling in
order to pursue settlement discussions
or ADR or for any other reason that the
parties mutually agree justifies tolling;
or (ii) if complying with the deadline
would violate the due process rights of
a party or would be inconsistent with
fundamental fairness. In addition, in
extraordinary situations, the ALJ may
toll the deadline for reaching a decision
due to a lack of adjudicatory resources
available at the time in the Office of
Administrative Law Judges.
6. Fourth, in response to concerns that
MVPDs have the ability to retaliate
against a programming vendor that files
a program carriage complaint by ceasing
carriage of the programming vendor’s
video programming, the Commission in
the Second Report and Order in MB
Docket No. 07–42 establishes
procedures for the Media Bureau’s
consideration of requests for a
temporary standstill of the price, terms,
and other conditions of an existing
programming contract by a program
carriage complainant seeking renewal of
such a contract. Pursuant to these
procedures, a program carriage
complainant seeking renewal of an
existing programming contract may
submit along with its complaint a
petition for a temporary standstill of its
programming contract pending
resolution of the complaint. The
Commission encourages complainants
to file the petition and complaint
sufficiently in advance of the expiration
of the existing contract, and in no case
later than 30 days prior to such
expiration, to provide the Media Bureau
with sufficient time to act prior to
expiration. In its petition, the
complainant must demonstrate how
grant of the standstill will meet the
following four criteria: (i) The
complainant is likely to prevail on the
merits of its complaint; (ii) the
complainant will suffer irreparable
harm absent a stay; (iii) grant of a stay
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will not substantially harm other
interested parties; and (iv) the public
interest favors grant of a stay. The
defendant will have ten calendar days
after service to file an answer to the
petition for a standstill order. If the
Media Bureau grants the temporary
standstill, the adjudicator ruling on the
merits of the complaint (i.e., either the
Media Bureau or an ALJ) will apply the
terms of the new agreement between the
parties, if any, as of the expiration date
of the previous agreement.
B. Summary of Significant Issues Raised
by Public Comments in Response to the
IRFA
7. There were no comments filed
specifically in response to the IRFA.
C. Description and Estimate of the
Number of Small Entities to Which the
Proposed Rules Will Apply
8. The RFA directs agencies to
provide a description of and, where
feasible, an estimate of the number of
small entities that may be affected by
the proposed rules, if adopted.76 The
RFA generally defines the term ‘‘small
entity’’ as having the same meaning as
the terms ‘‘small business,’’ ‘‘small
organization,’’ and ‘‘small governmental
jurisdiction.’’ 77 In addition, the term
‘‘small business’’ has the same meaning
as the term ‘‘small business concern’’
under the Small Business Act.78 A small
business concern is one which: (1) Is
independently owned and operated; (2)
is not dominant in its field of operation;
and (3) satisfies any additional criteria
established by the SBA.79 Below, we
provide a description of such small
entities, as well as an estimate of the
number of such small entities, where
feasible.
9. Wired Telecommunications
Carriers. The 2007 North American
Industry Classification System
(‘‘NAICS’’) defines ‘‘Wired
Telecommunications Carriers’’ as
follows: ‘‘This industry comprises
establishments primarily engaged in
76 5
U.S.C. 603(b)(3).
U.S.C. 601(6).
78 5 U.S.C. 601(3) (incorporating by reference the
definition of ‘‘small business concern’’ in 15 U.S.C.
632). Pursuant to 5 U.S.C. 601(3), the statutory
definition of a small business applies ‘‘unless an
agency, after consultation with the Office of
Advocacy of the Small Business Administration
and after opportunity for public comment,
establishes one or more definitions of such term
which are appropriate to the activities of the agency
and publishes such definition(s) in the Federal
Register.’’ 5 U.S.C. 601(3).
79 15 U.S.C. 632. Application of the statutory
criteria of dominance in its field of operation and
independence are sometimes difficult to apply in
the context of broadcast television. Accordingly, the
Commission’s statistical account of television
stations may be over-inclusive.
77 5
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operating and/or providing access to
transmission facilities and infrastructure
that they own and/or lease for the
transmission of voice, data, text, sound,
and video using wired
telecommunications networks.
Transmission facilities may be based on
a single technology or a combination of
technologies. Establishments in this
industry use the wired
telecommunications network facilities
that they operate to provide a variety of
services, such as wired telephony
services, including VoIP services; wired
(cable) audio and video programming
distribution; and wired broadband
Internet services. By exception,
establishments providing satellite
television distribution services using
facilities and infrastructure that they
operate are included in this
industry.’’ 80 The SBA has developed a
small business size standard for
wireline firms within the broad
economic census category, ‘‘Wired
Telecommunications Carriers.’’ 81 Under
this category, the SBA deems a wireline
business to be small if it has 1,500 or
fewer employees.82 Census Bureau data
for 2007, which now supersede data
from the 2002 Census, show that there
were 3,188 firms in this category that
operated for the entire year. Of this
total, 3,144 had employment of 999 or
fewer, and 44 firms had employment of
1,000 employees or more. Thus under
this category and the associated small
business size standard, the majority of
these firms can be considered small.83
10. Cable Television Distribution
Services. Since 2007, these services
have been defined within the broad
economic census category of Wired
Telecommunications Carriers; that
category is defined above. The SBA has
developed a small business size
standard for this category, which is: All
such firms having 1,500 or fewer
employees.84 Census Bureau data for
2007, which now supersede data from
the 2002 Census, show that there were
3,188 firms in this category that
operated for the entire year. Of this
total, 3,144 had employment of 999 or
fewer, and 44 firms had had
employment of 1,000 employees or
more. Thus under this category and the
associated small business size standard,
80 U.S. Census Bureau, 2007 NAICS Definitions,
‘‘517110 Wired Telecommunications Carriers’’;
https://www.census.gov/naics/2007/def/
ND517110.HTM#N517110.
81 13 CFR 121.201, 2007 NAICS code 517110.
82 See id.
83 See https://factfinder.census.gov/servlet/
IBQTable?_bm=y&-fds_name=EC0700A1&geo_id=&-_skip=600&-ds_name=EC0751SSSZ5&_lang=en.
84 13 CFR 121.201, 2007 NAICS code 517110.
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the majority of these firms can be
considered small.85
11. Cable Companies and Systems.
The Commission has also developed its
own small business size standards, for
the purpose of cable rate regulation.
Under the Commission’s rules, a ‘‘small
cable company’’ is one serving 400,000
or fewer subscribers nationwide.86
Industry data indicate that all but ten
cable operators nationwide are small
under this size standard.87 In addition,
under the Commission’s rules, a ‘‘small
system’’ is a cable system serving 15,000
or fewer subscribers.88 Industry data
indicate that, of 6,101 systems
nationwide, 4,410 systems have under
10,000 subscribers, and an additional
258 systems have 10,000–19,999
subscribers.89 Thus, under this
standard, most cable systems are small.
12. Cable System Operators. The
Communications Act of 1934, as
amended, also contains a size standard
for small cable system operators, which
is ‘‘a cable operator that, directly or
through an affiliate, serves in the
aggregate fewer than 1 percent of all
subscribers in the United States and is
not affiliated with any entity or entities
whose gross annual revenues in the
aggregate exceed $250,000,000.’’ 90 The
Commission has determined that an
operator serving fewer than 677,000
subscribers shall be deemed a small
operator if its annual revenues, when
combined with the total annual
revenues of all its affiliates, do not
exceed $250 million in the aggregate.91
Industry data indicate that all but nine
cable operators nationwide are small
under this subscriber size standard.92
We note that the Commission neither
requests nor collects information on
whether cable system operators are
affiliated with entities whose gross
85 See https://factfinder.census.gov/servlet/
IBQTable?_bm=y&-fds_name=EC0700A1&geo_id=&-_skip=600&-ds_name=EC0751SSSZ5&_lang=en.
86 47 CFR 76.901(e). The Commission determined
that this size standard equates approximately to a
size standard of $100 million or less in annual
revenues. Implementation of Sections of the 1992
Cable Act: Rate Regulation, Sixth Report and Order
and Eleventh Order on Reconsideration, 10 FCC
Rcd 7393, 7408 (1995).
87 See Broadcasting & Cable Yearbook 2010 at C–
2 (2009) (data current as of Dec. 2008).
88 47 CFR 76.901(c).
89 See Television & Cable Factbook 2009 at F–2
(2009) (data current as of Oct. 2008). The data do
not include 957 systems for which classifying data
were not available.
90 47 U.S.C. 543(m)(2); see 47 CFR 76.901(f) & nn.
1–3.
91 47 CFR 76.901(f); see FCC Announces New
Subscriber Count for the Definition of Small Cable
Operator, Public Notice, 16 FCC Rcd 2225 (Cable
Services Bureau 2001).
92 See Broadcasting & Cable Yearbook 2010 at C–
2 (2009) (data current as of Dec. 2008).
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annual revenues exceed $250 million,93
and therefore we are unable to estimate
more accurately the number of cable
system operators that would qualify as
small under this size standard.
13. Direct Broadcast Satellite (‘‘DBS’’)
Service. DBS service is a nationally
distributed subscription service that
delivers video and audio programming
via satellite to a small parabolic ‘‘dish’’
antenna at the subscriber’s location.
DBS, by exception, is now included in
the SBA’s broad economic census
category, ‘‘Wired Telecommunications
Carriers,’’ 94 which was developed for
small wireline firms. Under this
category, the SBA deems a wireline
business to be small if it has 1,500 or
fewer employees.95 Census Bureau data
for 2007, which now supersede data
from the 2002 Census, show that there
were 3,188 firms in this category that
operated for the entire year. Of this
total, 3,144 had employment of 999 or
fewer, and 44 firms had had
employment of 1,000 employees or
more. Thus under this category and the
associated small business size standard,
the majority of these firms can be
considered small.96 Currently, only two
entities provide DBS service, which
requires a great investment of capital for
operation: DIRECTV and EchoStar
Communications Corporation
(‘‘EchoStar’’) (marketed as the DISH
Network).97 Each currently offers
subscription services. DIRECTV 98 and
EchoStar 99 each report annual revenues
that are in excess of the threshold for a
small business. Because DBS service
93 The Commission does receive such information
on a case-by-case basis if a cable operator appeals
a local franchise authority’s finding that the
operator does not qualify as a small cable operator
pursuant to 76.901(f) of the Commission’s rules. See
47 CFR 76.901(f).
94 See 13 CFR 121.201, 2007 NAICS code 517110.
The 2007 NAICS definition of the category of
‘‘Wired Telecommunications Carriers’’ is in
paragraph 8, above.
95 13 CFR 121.201, 2007 NAICS code 517110.
96 See https://factfinder.census.gov/servlet/
IBQTable?_bm=y&-fds_name=EC0700A1&geo_id=&-_skip=600&-ds_name=EC0751SSSZ5&_lang=en.
97 See Annual Assessment of the Status of
Competition in the Market for the Delivery of Video
Programming, Thirteenth Annual Report, 24 FCC
Rcd 542, 580, para. 74 (2009) (‘‘13th Annual
Report’’). We note that, in 2007, EchoStar
purchased the licenses of Dominion Video Satellite,
Inc. (‘‘Dominion’’) (marketed as Sky Angel). See
Public Notice, ‘‘Policy Branch Information; Actions
Taken,’’ Report No. SAT–00474, 22 FCC Rcd 17776
(IB 2007).
98 As of June 2006, DIRECTV is the largest DBS
operator and the second largest MVPD, serving an
estimated 16.20% of MVPD subscribers nationwide.
See 13th Annual Report, 24 FCC Rcd at 687, Table
B–3.
99 As of June 2006, DISH Network is the second
largest DBS operator and the third largest MVPD,
serving an estimated 13.01% of MVPD subscribers
nationwide. Id.
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requires significant capital, we believe it
is unlikely that a small entity as defined
by the SBA would have the financial
wherewithal to become a DBS service
provider.
14. Satellite Master Antenna
Television (SMATV) Systems, also
known as Private Cable Operators
(PCOs). SMATV systems or PCOs are
video distribution facilities that use
closed transmission paths without using
any public right-of-way. They acquire
video programming and distribute it via
terrestrial wiring in urban and suburban
multiple dwelling units such as
apartments and condominiums, and
commercial multiple tenant units such
as hotels and office buildings. SMATV
systems or PCOs are now included in
the SBA’s broad economic census
category, ‘‘Wired Telecommunications
Carriers,’’ 100 which was developed for
small wireline firms. Under this
category, the SBA deems a wireline
business to be small if it has 1,500 or
fewer employees.101 Census Bureau data
for 2007, which now supersede data
from the 2002 Census, show that there
were 3,188 firms in this category that
operated for the entire year. Of this
total, 3,144 had employment of 999 or
fewer, and 44 firms had had
employment of 1,000 employees or
more. Thus, under this category and the
associated small business size standard,
the majority of these firms can be
considered small.102
15. Home Satellite Dish (‘‘HSD’’)
Service. HSD or the large dish segment
of the satellite industry is the original
satellite-to-home service offered to
consumers, and involves the home
reception of signals transmitted by
satellites operating generally in the Cband frequency. Unlike DBS, which
uses small dishes, HSD antennas are
between four and eight feet in diameter
and can receive a wide range of
unscrambled (free) programming and
scrambled programming purchased from
program packagers that are licensed to
facilitate subscribers’ receipt of video
programming. Because HSD provides
subscription services, HSD falls within
the SBA-recognized definition of Wired
Telecommunications Carriers.103 The
SBA has developed a small business
size standard for this category, which is:
all such firms having 1,500 or fewer
employees.104 Census Bureau data for
100 13
CFR 121.201, 2007 NAICS code 517110.
id.
102 See https://factfinder.census.gov/servlet/
IBQTable?_bm=y&-fds_name=EC0700A1&geo_id=&-_skip=600&-ds_name=EC0751SSSZ5&_lang=en.
103 13 CFR 121.201, 2007 NAICS code 517110.
104 See id.
101 See
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2007, which now supersede data from
the 2002 Census, show that there were
3,188 firms in this category that
operated for the entire year. Of this
total, 3,144 had employment of 999 or
fewer, and 44 firms had had
employment of 1,000 employees or
more. Thus, under this category and the
associated small business size standard,
the majority of these firms can be
considered small.105
16. Broadband Radio Service and
Educational Broadband Service.
Broadband Radio Service systems,
previously referred to as Multipoint
Distribution Service (MDS) and
Multichannel Multipoint Distribution
Service (MMDS) systems, and ‘‘wireless
cable,’’ transmit video programming to
subscribers and provide two-way high
speed data operations using the
microwave frequencies of the
Broadband Radio Service (BRS) and
Educational Broadband Service (EBS)
(previously referred to as the
Instructional Television Fixed Service
(ITFS)).106 In connection with the 1996
BRS auction, the Commission
established a small business size
standard as an entity that had annual
average gross revenues of no more than
$40 million in the previous three
calendar years.107 The BRS auctions
resulted in 67 successful bidders
obtaining licensing opportunities for
493 Basic Trading Areas (BTAs). Of the
67 auction winners, 61 met the
definition of a small business. BRS also
includes licensees of stations authorized
prior to the auction. At this time, we
estimate that of the 61 small business
BRS auction winners, 48 remain small
business licensees. In addition to the 48
small businesses that hold BTA
authorizations, there are approximately
392 incumbent BRS licensees that are
considered small entities.108 After
adding the number of small business
auction licensees to the number of
incumbent licensees not already
counted, we find that there are currently
105 See https://factfinder.census.gov/servlet/
IBQTable?_bm=y&-fds_name=EC0700A1&geo_id=&-_skip=600&-ds_name=EC0751SSSZ5&_lang=en.
106 Amendment of Parts 21 and 74 of the
Commission’s Rules with Regard to Filing
Procedures in the Multipoint Distribution Service
and in the Instructional Television Fixed Service
and Implementation of Section 309(j) of the
Communications Act—Competitive Bidding, MM
Docket No. 94–131, PP Docket No. 93–253, Report
and Order, 10 FCC Rcd 9589, 9593, para. 7 (1995).
107 47 CFR 21.961(b)(1).
108 47 U.S.C. 309(j). Hundreds of stations were
licensed to incumbent MDS licensees prior to
implementation of section 309(j) of the
Communications Act of 1934, 47 U.S.C. 309(j). For
these pre-auction licenses, the applicable standard
is SBA’s small business size standard of 1500 or
fewer employees.
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approximately 440 BRS licensees that
are defined as small businesses under
either the SBA or the Commission’s
rules. In 2009, the Commission
conducted Auction 86, the sale of 78
licenses in the BRS areas.109 The
Commission offered three levels of
bidding credits: (i) A bidder with
attributed average annual gross revenues
that exceed $15 million and do not
exceed $40 million for the preceding
three years (small business) received a
15 percent discount on its winning bid;
(ii) a bidder with attributed average
annual gross revenues that exceed $3
million and do not exceed $15 million
for the preceding three years (very small
business) received a 25 percent discount
on its winning bid; and (iii) a bidder
with attributed average annual gross
revenues that do not exceed $3 million
for the preceding three years
(entrepreneur) received a 35 percent
discount on its winning bid.110 Auction
86 concluded in 2009 with the sale of
61 licenses.111 Of the ten winning
bidders, two bidders that claimed small
business status won 4 licenses; one
bidder that claimed very small business
status won three licenses; and two
bidders that claimed entrepreneur status
won six licenses.
17. In addition, the SBA’s Cable
Television Distribution Services small
business size standard is applicable to
EBS. There are presently 2,032 EBS
licensees. All but 100 of these licenses
are held by educational institutions.
Educational institutions are included in
this analysis as small entities.112 Thus,
we estimate that at least 1,932 licensees
are small businesses. Since 2007, Cable
Television Distribution Services have
been defined within the broad economic
census category of Wired
Telecommunications Carriers; that
category is defined as follows: ‘‘This
industry comprises establishments
primarily engaged in operating and/or
providing access to transmission
facilities and infrastructure that they
own and/or lease for the transmission of
109 Auction of Broadband Radio Service (BRS)
Licenses, Scheduled for October 27, 2009, Notice
and Filing Requirements, Minimum Opening Bids,
Upfront Payments, and Other Procedures for
Auction 86, Public Notice, 24 FCC Rcd 8277 (2009).
110 Id. at 8296.
111 Auction of Broadband Radio Service Licenses
Closes, Winning Bidders Announced for Auction 86,
Down Payments Due November 23, 2009, Final
Payments Due December 8, 2009, Ten-Day Petition
to Deny Period, Public Notice, 24 FCC Rcd 13572
(2009).
112 The term ‘‘small entity’’ within SBREFA
applies to small organizations (nonprofits) and to
small governmental jurisdictions (cities, counties,
towns, townships, villages, school districts, and
special districts with populations of less than
50,000). 5 U.S.C. 601(4)–(6). We do not collect
annual revenue data on EBS licensees.
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voice, data, text, sound, and video using
wired telecommunications networks.
Transmission facilities may be based on
a single technology or a combination of
technologies.’’ 113 The SBA has
developed a small business size
standard for this category, which is: all
such firms having 1,500 or fewer
employees.114 Census Bureau data for
2007, which now supersede data from
the 2002 Census, show that there were
3,188 firms in this category that
operated for the entire year. Of this
total, 3,144 had employment of 999 or
fewer, and 44 firms had employment of
1,000 employees or more. Thus, under
this category and the associated small
business size standard, the majority of
these firms can be considered small.115
18. Fixed Microwave Services.
Microwave services include common
carrier,116 private-operational fixed,117
and broadcast auxiliary radio
services.118 They also include the Local
Multipoint Distribution Service
(LMDS),119 the Digital Electronic
Message Service (DEMS),120 and the 24
GHz Service,121 where licensees can
choose between common carrier and
non-common carrier status.122 At
present, there are approximately 31,428
common carrier fixed licensees and
79,732 private operational-fixed
licensees and broadcast auxiliary radio
licensees in the microwave services.
There are approximately 120 LMDS
licensees, three DEMS licensees, and
three 24 GHz licensees. The
Commission has not yet defined a small
business with respect to microwave
services. For purposes of the IRFA, we
will use the SBA’s definition applicable
to Wireless Telecommunications
Carriers (except satellite)—i.e., an entity
with no more than 1,500 persons.123
113 U.S. Census Bureau, 2007 NAICS Definitions,
‘‘517110 Wired Telecommunications Carriers,’’
(partial definition), https://www.census.gov/naics/
2007/def/ND517110.HTM#N517110.
114 13 CFR 121.201, 2007 NAICS code 517110.
115 See https://factfinder.census.gov/servlet/
IBQTable?_bm=y&-fds_name=EC0700A1&geo_id=&-_skip=600&-ds_name=EC0751SSSZ5&-_
lang=en.
116 See 47 CFR part 101, Subparts C and I.
117 See 47 CFR part 101, Subparts C and H.
118 Auxiliary Microwave Service is governed by
part 74 of Title 47 of the Commission’s rules. See
47 CFR part 74. Available to licensees of broadcast
stations and to broadcast and cable network
entities, broadcast auxiliary microwave stations are
used for relaying broadcast television signals from
the studio to the transmitter, or between two points
such as a main studio and an auxiliary studio. The
service also includes mobile TV pickups, which
relay signals from a remote location back to the
studio.
119 See 47 CFR part 101, subpart L.
120 See 47 CFR part 101, subpart G.
121 See id.
122 See 47 CFR 101.533, 101.1017.
123 13 CFR 121.201, 2007 NAICS code 517210.
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Under the present and prior categories,
the SBA has deemed a wireless business
to be small if it has 1,500 or fewer
employees.124 For the category of
Wireless Telecommunications Carriers
(except Satellite), Census data for 2007,
which supersede data contained in the
2002 Census, show that there were
1,383 firms that operated that year.125
Of those 1,383, 1,368 had fewer than
100 employees, and 15 firms had more
than 100 employees. Thus under this
category and the associated small
business size standard, the majority of
firms can be considered small. We note
that the number of firms does not
necessarily track the number of
licensees. We estimate that virtually all
of the Fixed Microwave licensees
(excluding broadcast auxiliary
licensees) would qualify as small
entities under the SBA definition.
19. Open Video Systems. The open
video system (‘‘OVS’’) framework was
established in 1996, and is one of four
statutorily recognized options for the
provision of video programming
services by local exchange carriers.126
The OVS framework provides
opportunities for the distribution of
video programming other than through
cable systems. Because OVS operators
provide subscription services,127 OVS
falls within the SBA small business size
standard covering cable services, which
is ‘‘Wired Telecommunications
Carriers.’’ 128 The SBA has developed a
small business size standard for this
category, which is: all such firms having
1,500 or fewer employees.129 Census
Bureau data for 2007, which now
supersede data from the 2002 Census,
show that there were 3,188 firms in this
category that operated for the entire
year. Of this total, 3,144 had
employment of 999 or fewer, and 44
firms had had employment of 1,000
employees or more. Thus, under this
category and the associated small
business size standard, the majority of
these firms can be considered small.130
In addition, we note that the
Commission has certified some OVS
operators, with some now providing
service.131 Broadband service providers
(‘‘BSPs’’) are currently the only
significant holders of OVS certifications
or local OVS franchises.132 The
Commission does not have financial or
employment information regarding the
entities authorized to provide OVS,
some of which may not yet be
operational. Thus, at least some of the
OVS operators may qualify as small
entities.
20. Cable and Other Subscription
Programming. The Census Bureau
defines this category as follows: ‘‘This
industry comprises establishments
primarily engaged in operating studios
and facilities for the broadcasting of
programs on a subscription or fee basis
* * *. These establishments produce
programming in their own facilities or
acquire programming from external
sources. The programming material is
usually delivered to a third party, such
as cable systems or direct-to-home
satellite systems, for transmission to
viewers.’’ 133 The SBA has developed a
small business size standard for this
category, which is: all such firms having
$15 million dollars or less in annual
revenues.134 To gauge small business
prevalence in the Cable and Other
Subscription Programming industries,
the Commission relies on data currently
available from the U.S. Census for the
year 2007. Census Bureau data for 2007,
which now supersede data from the
2002 Census, show that there were 396
firms in this category that operated for
the entire year.135 Of that number, 325
operated with annual revenues of
$9,999,999 or less.136 Seventy-one (71)
operated with annual revenues of
between $10 million and $100 million
or more.137 Thus, under this category
and associated small business size
standard, the majority of firms can be
considered small.
21. Small Incumbent Local Exchange
Carriers. We have included small
124 See id. The now-superseded, pre-2007 CFR
citations were 13 CFR 121.201, NAICS codes
517211 and 517212 (referring to the 2002 NAICS).
125 U.S. Census Bureau, 2007 Economic Census,
Sector 51, 2007 NAICS code 517210 (rel. Oct. 20,
2009), https://factfinder.census.gov/servlet/
IBQTable?_bm=y&-geo_id=&-fds_
name=EC0700A1&-_skip=700&-ds_
name=EC0751SSSZ5&-_lang=en.
126 47 U.S.C. 571(a)(3)–(4). See 13th Annual
Report, 24 FCC Rcd at 606, para. 135.
127 See 47 U.S.C. 573.
128 U.S. Census Bureau, 2007 NAICS Definitions,
‘‘517110 Wired Telecommunications Carriers’’;
https://www.census.gov/naics/2007/def/ND517110.
HTM#N517110.
129 13 CFR 121.201, 2007 NAICS code 517110.
130 See https://factfinder.census.gov/servlet/
IBQTable?_bm=y&-fds_name=EC0700A1&-
geo_id=&-_skip=600&-ds_name=EC0751SSSZ5&_lang=en.
131 A list of OVS certifications may be found at
https://www.fcc.gov/mb/ovs/csovscer.html.
132 See 13th Annual Report, 24 FCC Rcd at 606–
07, para. 135. BSPs are newer firms that are
building state-of-the-art, facilities-based networks to
provide video, voice, and data services over a single
network.
133 U.S. Census Bureau, 2007 NAICS Definitions,
‘‘515210 Cable and Other Subscription
Programming’’; https://www.census.gov/naics/2007/
def/ND515210.HTM#N515210.
134 13 CFR 121.201, 2007 NAICS code 515210.
135 https://factfinder.census.gov/servlet/
IBQTable?_bm=y&-geo_id=&-_skip=700&-ds_
name=EC0751SSSZ4&-_lang=en.
136 Id.
137 Id.
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incumbent local exchange carriers in
this present RFA analysis. A ‘‘small
business’’ under the RFA is one that,
inter alia, meets the pertinent small
business size standard (e.g., a telephone
communications business having 1,500
or fewer employees), and ‘‘is not
dominant in its field of operation.’’ 138
The SBA’s Office of Advocacy contends
that, for RFA purposes, small incumbent
local exchange carriers are not dominant
in their field of operation because any
such dominance is not ‘‘national’’ in
scope.139 We have therefore included
small incumbent local exchange carriers
in this RFA analysis, although we
emphasize that this RFA action has no
effect on Commission analyses and
determinations in other, non-RFA
contexts.
22. Incumbent Local Exchange
Carriers (‘‘LECs’’). Neither the
Commission nor the SBA has developed
a small business size standard
specifically for incumbent local
exchange services. The appropriate size
standard under SBA rules is for the
category Wired Telecommunications
Carriers. Under that size standard, such
a business is small if it has 1,500 or
fewer employees.140 Census Bureau data
for 2007, which now supersede data
from the 2002 Census, show that there
were 3,188 firms in this category that
operated for the entire year. Of this
total, 3,144 had employment of 999 or
fewer, and 44 firms had employment of
1,000 employees or more. Thus, under
this category and the associated small
business size standard, the majority of
these firms can be considered small.141
23. Competitive Local Exchange
Carriers, Competitive Access Providers
(CAPs), ‘‘Shared-Tenant Service
Providers,’’ and ‘‘Other Local Service
Providers.’’ Neither the Commission nor
the SBA has developed a small business
size standard specifically for these
service providers. The appropriate size
standard under SBA rules is for the
category Wired Telecommunications
Carriers. Under that size standard, such
a business is small if it has 1,500 or
138 15
U.S.C. 632.
from Jere W. Glover, Chief Counsel for
Advocacy, SBA, to William E. Kennard, Chairman,
FCC (May 27, 1999). The Small Business Act
contains a definition of ‘‘small-business concern,’’
which the RFA incorporates into its own definition
of ‘‘small business.’’ See 15 U.S.C. 632(a) (Small
Business Act); 5 U.S.C. 601(3) (RFA). SBA
regulations interpret ‘‘small business concern’’ to
include the concept of dominance on a national
basis. See 13 CFR 121.102(b).
140 13 CFR 121.201, 2007 NAICS code 517110.
141 See https://factfinder.census.gov/servlet/
IBQTable?_bm=y&-fds_name=EC0700A1&geo_id=&-_skip=600&-ds_name=EC0751SSSZ5&-_
lang=en.
139 Letter
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fewer employees.142 Census Bureau data
for 2007, which now supersede data
from the 2002 Census, show that there
were 3,188 firms in this category that
operated for the entire year. Of this
total, 3,144 had employment of 999 or
fewer, and 44 firms had had
employment of 1,000 employees or
more. Thus, under this category and the
associated small business size standard,
the majority of these firms can be
considered small.143 Consequently, the
Commission estimates that most
providers of competitive local exchange
service, competitive access providers,
‘‘Shared-Tenant Service Providers,’’ and
‘‘Other Local Service Providers’’ are
small entities.
24. Television Broadcasting. The SBA
defines a television broadcasting station
as a small business if such station has
no more than $14.0 million in annual
receipts.144 Business concerns included
in this industry are those ‘‘primarily
engaged in broadcasting images together
with sound.’’ 145 The Commission has
estimated the number of licensed
commercial television stations to be
1,390.146 According to Commission staff
review of the BIA/Kelsey, MAPro
Television Database (‘‘BIA’’) as of April
7, 2010, about 1,015 of an estimated
1,380 commercial television stations 147
(or about 74 percent) have revenues of
$14 million or less and, thus, qualify as
small entities under the SBA definition.
The Commission has estimated the
142 13
CFR 121.201, 2007 NAICS code 517110.
https://factfinder.census.gov/servlet/
IBQTable?_bm=y&-fds_name=EC0700A1&geo_id=&-_skip=600&-ds_name=EC0751SSSZ5&-_
lang=en.
144 See 13 CFR 121.201, 2007 NAICS Code
515120.
145 U.S. Census Bureau, 2007 NAICS Definitions,
‘‘515120 Television Broadcasting’’; https://www.
census.gov/naics/2007/def/ND515120.HTM. This
category description continues, ‘‘These
establishments operate television broadcasting
studios and facilities for the programming and
transmission of programs to the public. These
establishments also produce or transmit visual
programming to affiliated broadcast television
stations, which in turn broadcast the programs to
the public on a predetermined schedule.
Programming may originate in their own studios,
from an affiliated network, or from external
sources.’’ Separate census categories pertain to
businesses primarily engaged in producing
programming. See Motion Picture and Video
Production, NAICS code 512110; Motion Picture
and Video Distribution, NAICS Code 512120;
Teleproduction and Other Post-Production
Services, NAICS Code 512191; and Other Motion
Picture and Video Industries, NAICS Code 512199.
146 See News Release, ‘‘Broadcast Station Totals
as of December 31, 2010,’’ 2011 WL 484756 (dated
Feb. 11, 2011) (‘‘Broadcast Station Totals’’); also
available at https://www.fcc.gov/Daily_Releases/
Daily_Business/2011/db0211/DOC-304594A1.pdf.
147 We recognize that this total differs slightly
from that contained in Broadcast Station Totals,
supra, note 105; however, we are using BIA’s
estimate for purposes of this revenue comparison.
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143 See
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number of licensed noncommercial
educational (NCE) television stations to
be 391.148 We note, however, that, in
assessing whether a business concern
qualifies as small under the above
definition, business (control)
affiliations 149 must be included. Our
estimate, therefore, likely overstates the
number of small entities that might be
affected by our action, because the
revenue figure on which it is based does
not include or aggregate revenues from
affiliated companies. The Commission
does not compile and otherwise does
not have access to information on the
revenue of NCE stations that would
permit it to determine how many such
stations would qualify as small entities.
25. In addition, an element of the
definition of ‘‘small business’’ is that the
entity not be dominant in its field of
operation. We are unable at this time to
define or quantify the criteria that
would establish whether a specific
television station is dominant in its field
of operation. Accordingly, the estimate
of small businesses to which rules may
apply do not exclude any television
station from the definition of a small
business on this basis and are therefore
over-inclusive to that extent. Also, as
noted, an additional element of the
definition of ‘‘small business’’ is that the
entity must be independently owned
and operated. We note that it is difficult
at times to assess these criteria in the
context of media entities and our
estimates of small businesses to which
they apply may be over-inclusive to this
extent.
26. Motion Picture and Video
Production. The Census Bureau defines
this category as follows: ‘‘This industry
comprises establishments primarily
engaged in producing, or producing and
distributing motion pictures, videos,
television programs, or television
commercials.’’ 150 We note that firms in
this category may be engaged in various
industries, including cable
programming. Specific figures are not
available regarding how many of these
firms produce and/or distribute
programming for cable television. The
SBA has developed a small business
size standard for this category, which is:
all such firms having $29.5 million
dollars or less in annual revenues.151 To
148 See
Broadcast Station Totals, supra, note 146.
concerns] are affiliates of each
other when one concern controls or has the power
to control the other or a third party or parties
controls or has to power to control both.’’ 13 CFR
121.103(a)(1).
150 U.S. Census Bureau, 2007 NAICS Definitions,
‘‘51211 Motion Picture and Video Production’’;
https://www.census.gov/naics/2007/def/NDEF512.
HTM#N51211.
151 13 CFR 121.201, 2007 NAICS code 512110.
149 ‘‘[Business
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gauge small business prevalence in the
Motion Picture and Video Production
industries, the Commission relies on
data currently available from the U.S.
Census for the year 2007. Census Bureau
data for 2007, which now supersede
data from the 2002 Census, show that
there were 9,095 firms in this category
that operated for the entire year.152 Of
these, 8995 had annual receipts of
$24,999,999 or less, and 100 has annual
receipts ranging from not less that
$25,000,000 to $100,000,000 or more.153
Thus, under this category and
associated small business size standard,
the majority of firms can be considered
small.
27. Motion Picture and Video
Distribution. The Census Bureau defines
this category as follows: ‘‘This industry
comprises establishments primarily
engaged in acquiring distribution rights
and distributing film and video
productions to motion picture theaters,
television networks and stations, and
exhibitors.’’ 154 We note that firms in
this category may be engaged in various
industries, including cable
programming. Specific figures are not
available regarding how many of these
firms produce and/or distribute
programming for cable television. The
SBA has developed a small business
size standard for this category, which is:
all such firms having $29.5 million
dollars or less in annual revenues.155 To
gauge small business prevalence in the
Motion Picture and Video Distribution
industries, the Commission relies on
data currently available from the U.S.
Census for the year 2007. Census Bureau
data for 2007, which now supersede
data from the 2002 Census, show that
there were 450 firms in this category
that operated for the entire year.156 Of
these, 434 had annual receipts of
$24,999,999 or less, and 16 had annual
receipts ranging from not less that
$25,000,000 to $100,000,000 or more.157
Thus, under this category and
associated small business size standard,
the majority of firms can be considered
small.
152 See https://factfinder.census.gov/servlet/
IBQTable?_bm=y&-geo_id=&-fds_name=
EC0700A1&-_skip=200&-ds_name=EC0751SSSZ5&_lang=en.
153 Id.
154 See U.S. Census Bureau, 2007 NAICS
Definitions, ‘‘51212 Motion Picture and Video
Distribution’’; https://www.census.gov/naics/2007/
def/NDEF512.HTM#N51212.
155 13 CFR 121.201, 2007 NAICS code 512120.
156 https://factfinder.census.gov/servlet/
IBQTable?_bm=y&-geo_id=&-_skip=200&-ds_
name=EC0751SSSZ4&-_lang=en.
157 Id.
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D. Description of Projected Reporting,
Recordkeeping, and Other Compliance
Requirements
28. The rules adopted in the Second
Report and Order in MB Docket No. 07–
42 will impose additional reporting,
recordkeeping, and compliance
requirements on video programming
vendors and MVPDs. First, the Second
Report and Order in MB Docket No. 07–
42 clarifies what evidence a
complainant must provide in its
program carriage complaint in order to
establish a prima facie case of a program
carriage violation.158 Second, to enable
the defendant to develop a full, casespecific response to the evidence put
forth by the complainant, with
supporting evidence, the Second Report
and Order in MB Docket No. 07–42
provides the defendant with 60 days
(rather than the current 30 days) to
answer the complaint.159 Third, in
adopting a deadline for an ALJ to issue
a decision on the merits of a program
carriage complaint referred by Media
Bureau, the Second Report and Order in
MB Docket No. 07–42 adopts revised
procedural deadlines applicable to
adjudicatory hearings involving
program carriage complaints.160 Fourth,
the Second Report and Order in MB
Docket No. 07–42 establishes
procedures for the Commission’s
consideration of requests for a
temporary standstill of the price, terms,
and other conditions of an existing
programming contract by a program
carriage complainant seeking renewal of
such a contract.161
E. Steps Taken To Minimize Significant
Economic Impact on Small Entities, and
Significant Alternatives Considered
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29. The RFA requires an agency to
describe any significant alternatives that
it has considered in reaching its
proposed approach, which may include
the following four alternatives (among
others): (1) The establishment of
differing compliance or reporting
requirements or timetables that take into
account the resources available to small
entities; (2) the clarification,
consolidation, or simplification of
compliance or reporting requirements
under the rule for small entities; (3) the
use of performance, rather than design,
standards; and (4) an exemption from
coverage of the rule, or any part thereof,
158 See
Second Report and Order in MB Docket
No. 07–42 at paras. 9–17.
159 See Second Report and Order in MB Docket
No. 07–42 at para. 18.
160 See Second Report and Order in MB Docket
No. 07–42 at paras. 19–24.
161 See Second Report and Order in MB Docket
No. 07–42 at paras. 25–30.
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for small entities.162 The Program
Carriage NPRM invited comment on
issues that had the potential to have
significant economic impact on some
small entities.163
30. As discussed in section A, the
Second Report and Order in MB Docket
No. 07–42 is intended to improve the
Commission’s procedures for addressing
program carriage complaints. By
clarifying the evidence a complainant
must provide in its complaint to
establish a prima facie case of a program
carriage violation, providing defendants
with additional time to answer a
complaint, establishing deadlines for
action on program carriage complaints,
and establishing procedures for
requesting a standstill of an existing
programming contract, the decision
confers benefits upon both video
programming vendors and MVPDs,
including those that are smaller entities,
as well as MVPD subscribers. Thus, the
decision benefits smaller entities as well
as larger entities. For this reason, an
analysis of alternatives to the proposed
rules is unnecessary.
F. Report to Congress
31. The Commission will send a copy
of the Second Report and Order in MB
Docket No. 07–42, including this FRFA,
in a report to be sent to Congress and
the Government Accountability Office
pursuant to the Congressional Review
Act.164 In addition, the Commission will
send a copy of the Second Report and
Order in MB Docket No. 07–42,
including this FRFA, to the Chief
Counsel for Advocacy of the SBA. A
copy of the Second Report and Order in
MB Docket No. 07–42 and FRFA (or
summaries thereof) will also be
published in the Federal Register.165
V. Ordering Clauses
32. It is ordered, pursuant to the
authority found in sections 4(i), 4(j),
303(r), and 616 of the Communications
Act of 1934, as amended, 47 U.S.C.
154(i), 154(j), 303(r), and 536, the
Second Report and Order in MB Docket
No. 07–42 Is Adopted.
33. It is further ordered that, pursuant
to the authority found in sections 4(i),
4(j), 303(r), and 616 of the
Communications Act of 1934, as
amended, 47 U.S.C. 154(i), 154(j),
303(r), and 536, the Commission’s rules
Are Hereby Amended as set forth in the
Rules Changes below.
34. It is further ordered that the rules
adopted herein are effective October 31,
162 5
U.S.C. 603(c)(1)–(c)(4).
163 See Program Carriage NPRM, 22 FCC Rcd at
11231–11240, Appendix.
164 See 5 U.S.C. 801(a)(1)(A).
165 See 5 U.S.C. 604(b).
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2011, except for §§ 1.221(h), 1.229(b)(3),
1.229(b)(4), 1.248(a), 1.248(b), 76.7(g)(2),
76.1302(c)(1), 76.1302(d), 76.1302 (e)(1),
and 76.1302(k) which contain new or
modified information collection
requirements that require approval by
the Office of Management and Budget
(‘‘OMB’’) under the Paperwork
Reduction Act (PRA) and will become
effective after the Commission publishes
a notice in the Federal Register
announcing such approval and the
relevant effective date.
35. It is further ordered that the
Commission’s Consumer and
Governmental Affairs Bureau, Reference
Information Center, Shall Send a copy
of this Second Report and Order in MB
Docket No. 07–42, including the Final
Regulatory Flexibility Analysis, to the
Chief Counsel for Advocacy of the Small
Business Administration.
36. It is further ordered that the
Commission Shall Send a copy of this
Second Report and Order in MB Docket
No. 07–42 in a report to be sent to
Congress and the Government
Accountability Office pursuant to the
Congressional Review Act, see 5 U.S.C.
801(a)(1)(A).
List of Subjects
47 CFR Part 0
Organization and functions
(Government agencies).
47 CFR Part 1
Administrative practice and
procedure, claims, Investigations,
Lawyers, Telecommunications.
47 CFR Part 76
Administrative practice and
procedure, Cable television, Equal
employment opportunity, Political
candidates, and Reporting and
recordkeeping requirements.
Federal Communications Commission.
Marlene H. Dortch,
Secretary.
Final Rules
For the reasons discussed in the
preamble, the Federal Communications
Commission amends 47 CFR Parts 0, 1,
and 76 as follows:
PART 0—COMMISSION
ORGANIZATION
1. The authority citation for Part 0
continues to read as follows:
■
Authority: Sec. 5, 48 Stat. 1068, as
amended; 47 U.S.C. 155, 225, unless
otherwise noted.
2. Section 0.341 is amended by adding
paragraph (f) to read as follows:
■
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§ 0.341
judge.
Federal Register / Vol. 76, No. 189 / Thursday, September 29, 2011 / Rules and Regulations
Authority of administrative law
*
*
*
*
*
(f)(1) For program carriage complaints
filed pursuant to § 76.1302 of this
chapter that the Chief, Media Bureau
refers to an administrative law judge for
an initial decision, the presiding
administrative law judge shall release
an initial decision in compliance with
one of the following deadlines:
(i) 240 calendar days after a party
informs the Chief Administrative Law
Judge that it elects not to pursue
alternative dispute resolution as set
forth in § 76.7(g)(2) of this chapter; or
(ii) If the parties have mutually
elected to pursue alternative dispute
resolution pursuant to § 76.7(g)(2) of
this chapter, within 240 calendar days
after the parties inform the Chief
Administrative Law Judge that they
have failed to resolve their dispute
through alternative dispute resolution.
(2) The presiding administrative law
judge may toll these deadlines under the
following circumstances:
(i) If the complainant and defendant
jointly request that the presiding
administrative law judge toll these
deadlines in order to pursue settlement
discussions or alternative dispute
resolution or for any other reason that
the complainant and defendant
mutually agree justifies tolling; or
(ii) If complying with the deadline
would violate the due process rights of
a party or would be inconsistent with
fundamental fairness; or
(iii) In extraordinary situations, due to
a lack of adjudicatory resources
available at the time in the Office of
Administrative Law Judges.
§ 1.229 Motions to enlarge, change, or
delete issues.
PART 1—PRACTICE AND
PROCEDURE
*
3. The authority citation for Part 1
continues to read as follows:
■
Authority: 15 U.S.C. 79 et seq.; 47 U.S.C.
151, 154(i), 154(j), 155, 157, 225, 227, 303(r),
and 309.
4. Section 1.221 is amended by adding
paragraph (h) to read as follows:
■
§ 1.221
Notice of hearing; appearances.
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*
*
*
*
*
(h)(1) For program carriage
complaints filed pursuant to § 76.1302
of this chapter that the Chief, Media
Bureau refers to an administrative law
judge for an initial decision, each party,
in person or by attorney, shall file a
written appearance within five calendar
days after the party informs the Chief
Administrative Law Judge that it elects
not to pursue alternative dispute
resolution pursuant to § 76.7(g)(2) of
this chapter or, if the parties have
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16:55 Sep 28, 2011
mutually elected to pursue alternative
dispute resolution pursuant to
§ 76.7(g)(2) of this chapter, within five
calendar days after the parties inform
the Chief Administrative Law Judge that
they have failed to resolve their dispute
through alternative dispute resolution.
The written appearance shall state that
the party will appear on the date fixed
for hearing and present evidence on the
issues specified in the hearing
designation order.
(2) If the complainant fails to file a
written appearance by this deadline, or
fails to file prior to the deadline either
a petition to dismiss the proceeding
without prejudice or a petition to
accept, for good cause shown, a written
appearance beyond such deadline, the
Chief Administrative Law Judge shall
dismiss the complaint with prejudice
for failure to prosecute.
(3) If the defendant fails to file a
written appearance by this deadline, or
fails to file prior to this deadline a
petition to accept, for good cause
shown, a written appearance beyond
such deadline, its opportunity to
present evidence at hearing will be
deemed to have been waived. If the
hearing is so waived, the Chief
Administrative Law Judge shall
expeditiously terminate the proceeding
and certify to the Commission the
complaint for resolution based on the
existing record.
*
*
*
*
*
■ 5. Section 1.229 is amended by
redesignating paragraph (b)(3) as (b)(4),
revising newly redesignated paragraph
(b)(4), and adding new paragraph (b)(3),
to read as follows:
Jkt 223001
*
*
*
*
(b) * * *
(3) For program carriage complaints
filed pursuant to § 76.1302 of this
chapter that the Chief, Media Bureau
refers to an administrative law judge for
an initial decision, such motions shall
be filed within 15 calendar days after
the deadline for submitting written
appearances pursuant to § 1.221(h),
except that persons not named as parties
to the proceeding in the designation
order may file such motions with their
petitions to intervene up to 30 days after
publication of the full text or a summary
of the designation order in the Federal
Register. (See § 1.223).
(4) Any person desiring to file a
motion to modify the issues after the
expiration of periods specified in
paragraphs (a), (b)(1), (b)(2), and (b)(3) of
this section, shall set forth the reason
why it was not possible to file the
motion within the prescribed period.
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Except as provided in paragraph (c) of
this section, the motion will be granted
only if good cause is shown for the
delay in filing. Motions for
modifications of issues which are based
on new facts or newly discovered facts
shall be filed within 15 days after such
facts are discovered by the moving
party.
*
*
*
*
*
■ 6. Section 1.248 is amended by
revising paragraphs (a) and (b)(1) to read
as follows:
§ 1.248 Prehearing conferences; hearing
conferences.
(a) The Commission, on its own
initiative or at the request of any party,
may direct the parties or their attorneys
to appear at a specified time and place
for a conference prior to a hearing, or to
submit suggestions in writing, for the
purpose of considering, among other
things, the matters set forth in paragraph
(c) of this section. The initial prehearing
conference shall be scheduled 30 days
after the effective date of the order
designating a case for hearing, unless
good cause is shown for scheduling
such conference at a later date, except
that for program carriage complaints
filed pursuant to § 76.1302 of this
chapter that the Chief, Media Bureau
refers to an administrative law judge for
an initial decision, the initial prehearing
conference shall be held no later than 10
calendar days after the deadline for
submitting written appearances
pursuant to § 1.221(h) or within such
shorter or longer period as the
Commission may allow on motion or
notice consistent with the public
interest.
(b)(1) The presiding officer (or the
Commission or a panel of
commissioners in a case over which it
presides), on his own initiative or at the
request of any party, may direct the
parties or their attorneys to appear at a
specified time and place for a
conference prior to or during the course
of a hearing, or to submit suggestions in
writing, for the purpose of considering
any of the matters set forth in paragraph
(c) of this section. The initial prehearing
conference shall be scheduled 30 days
after the effective date of the order
designating a case for hearing, unless
good cause is shown for scheduling
such conference at a later date, except
that for program carriage complaints
filed pursuant to § 76.1302 of this
chapter that the Chief, Media Bureau
refers to an administrative law judge for
an initial decision, the initial prehearing
conference shall be held no later than 10
calendar days after the deadline for
submitting written appearances
pursuant to § 1.221(h) or within such
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shorter or longer period as the presiding
officer may allow on motion or notice
consistent with the public interest.
*
*
*
*
*
PART 76—MULTICHANNEL VIDEO
AND CABLE TELEVISION SERVICE
7. The authority citation for Part 76
continues to read as follows:
■
Authority: 47 U.S.C. 151, 152, 153, 154,
301, 302, 302a, 303, 303a, 307, 308, 309, 312,
315, 317, 325, 339, 340, 341, 503, 521, 522,
531, 532, 534, 535, 536, 537, 543, 544, 544a,
545, 548, 549, 552, 554, 556, 558, 560, 561,
571, 572 and 573.
8. Section 76.7 is amended by revising
paragraph (g)(2) to read as follows:
■
§ 76.7 General special relief, waiver,
enforcement, complaint, show cause,
forfeiture, and declaratory ruling
procedures.
*
*
*
*
*
(g) * * *
(2) Before designation for hearing, the
staff shall notify, either orally or in
writing, the parties to the proceeding of
its intent to so designate, and the parties
shall be given a period of ten (10) days
to elect to resolve the dispute through
alternative dispute resolution
procedures, or to proceed with an
adjudicatory hearing. Such election
shall be submitted in writing to the
Commission and the Chief
Administrative Law Judge.
*
*
*
*
*
■ 9. Section 76.1302 is amended by
revising paragraphs (c) through (g) and
adding paragraphs (h) through (k) to
read as follows:
§ 76.1302 Carriage agreement
proceedings.
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*
*
*
*
*
(c) Contents of complaint. In addition
to the requirements of § 76.7, a carriage
agreement complaint shall contain:
(1) Whether the complainant is a
multichannel video programming
distributor or video programming
vendor, and, in the case of a
multichannel video programming
distributor, identify the type of
multichannel video programming
distributor, the address and telephone
number of the complainant, what type
of multichannel video programming
distributor the defendant is, and the
address and telephone number of each
defendant;
(2) Evidence that supports
complainant’s belief that the defendant,
where necessary, meets the attribution
standards for application of the carriage
agreement regulations;
(3) The complaint must be
accompanied by appropriate evidence
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16:55 Sep 28, 2011
Jkt 223001
demonstrating that the required
notification pursuant to paragraph (b) of
this section has been made.
(d) Prima facie case. In order to
establish a prima facie case of a
violation of § 76.1301, the complaint
must contain evidence of the following:
(1) The complainant is a video
programming vendor as defined in
section 616(b) of the Communications
Act of 1934, as amended, and
§ 76.1300(e) or a multichannel video
programming distributor as defined in
section 602(13) of the Communications
Act of 1934, as amended, and
§ 76.1300(d);
(2) The defendant is a multichannel
video programming distributor as
defined in section 602(13) of the
Communications Act of 1934, as
amended, and § 76.1300(d); and
(3)(i) Financial interest. In a
complaint alleging a violation of
§ 76.1301(a), documentary evidence or
testimonial evidence (supported by an
affidavit from a representative of the
complainant) that supports the claim
that the defendant required a financial
interest in any program service as a
condition for carriage on one or more of
such defendant’s systems.
(ii) Exclusive rights. In a complaint
alleging a violation of § 76.1301(b),
documentary evidence or testimonial
evidence (supported by an affidavit
from a representative of the
complainant) that supports the claim
that the defendant coerced a video
programming vendor to provide, or
retaliated against such a vendor for
failing to provide, exclusive rights
against any other multichannel video
programming distributor as a condition
for carriage on a system.
(iii) Discrimination. In a complaint
alleging a violation of § 76.1301(c):
(A) Evidence that the conduct alleged
has the effect of unreasonably
restraining the ability of an unaffiliated
video programming vendor to compete
fairly; and
(B) (1) Documentary evidence or
testimonial evidence (supported by an
affidavit from a representative of the
complainant) that supports the claim
that the defendant discriminated in
video programming distribution on the
basis of affiliation or non-affiliation of
vendors in the selection, terms, or
conditions for carriage of video
programming provided by such vendors;
or
(2) (i) Evidence that the complainant
provides video programming that is
similarly situated to video programming
provided by a video programming
vendor affiliated (as defined in
§ 76.1300(a)) with the defendant
multichannel video programming
PO 00000
Frm 00023
Fmt 4701
Sfmt 4700
60673
distributor, based on a combination of
factors, such as genre, ratings, license
fee, target audience, target advertisers,
target programming, and other factors;
and
(ii) Evidence that the defendant
multichannel video programming
distributor has treated the video
programming provided by the
complainant differently than the
similarly situated, affiliated video
programming described in paragraph
(d)(3)(iii)(B)(2)(i) of this section with
respect to the selection, terms, or
conditions for carriage.
(e) Answer. (1) Any multichannel
video programming distributor upon
which a carriage agreement complaint is
served under this section shall answer
within sixty (60) days of service of the
complaint, unless otherwise directed by
the Commission.
(2) The answer shall address the relief
requested in the complaint, including
legal and documentary support, for such
response, and may include an
alternative relief proposal without any
prejudice to any denials or defenses
raised.
(f) Reply. Within twenty (20) days
after service of an answer, unless
otherwise directed by the Commission,
the complainant may file and serve a
reply which shall be responsive to
matters contained in the answer and
shall not contain new matters.
(g) Prima facie determination. (1)
Within sixty (60) calendar days after the
complainant’s reply to the defendant’s
answer is filed (or the date on which the
reply would be due if none is filed), the
Chief, Media Bureau shall release a
decision determining whether the
complainant has established a prima
facie case of a violation of § 76.1301.
(2) The Chief, Media Bureau may toll
the sixty (60)-calendar-day deadline
under the following circumstances:
(i) If the complainant and defendant
jointly request that the Chief, Media
Bureau toll these deadlines in order to
pursue settlement discussions or
alternative dispute resolution or for any
other reason that the complainant and
defendant mutually agree justifies
tolling; or
(ii) If complying with the deadline
would violate the due process rights of
a party or would be inconsistent with
fundamental fairness.
(3) A finding that the complainant has
established a prima facie case of a
violation of § 76.1301 means that the
complainant has provided sufficient
evidence in its complaint to allow the
case to proceed to a ruling on the merits.
(4) If the Chief, Media Bureau finds
that the complainant has not established
a prima facie case of a violation of
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jlentini on DSK4TPTVN1PROD with RULES3
§ 76.1301, the Chief, Media Bureau will
dismiss the complaint.
(h) Time limit on filing of complaints.
Any complaint filed pursuant to this
subsection must be filed within one year
of the date on which one of the
following events occurs:
(1) The multichannel video
programming distributor enters into a
contract with a video programming
distributor that a party alleges to violate
one or more of the rules contained in
this section; or
(2) The multichannel video
programming distributor offers to carry
the video programming vendor’s
programming pursuant to terms that a
party alleges to violate one or more of
the rules contained in this section, and
such offer to carry programming is
unrelated to any existing contract
between the complainant and the
multichannel video programming
distributor; or
(3) A party has notified a
multichannel video programming
distributor that it intends to file a
complaint with the Commission based
on violations of one or more of the rules
contained in this section.
(i) Deadline for decision on the merits.
(1)(i) For program carriage complaints
that the Chief, Media Bureau decides on
the merits based on the complaint,
answer, and reply without discovery,
the Chief, Media Bureau shall release a
decision on the merits within sixty (60)
calendar days after the Chief, Media
Bureau’s prima facie determination.
(ii) For program carriage complaints
that the Chief, Media Bureau decides on
the merits after discovery, the Chief,
Media Bureau shall release a decision
on the merits within 150 calendar days
after the Chief, Media Bureau’s prima
facie determination.
(iii) The Chief, Media Bureau may toll
these deadlines under the following
circumstances:
(A) If the complainant and defendant
jointly request that the Chief, Media
Bureau toll these deadlines in order to
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16:55 Sep 28, 2011
Jkt 223001
pursue settlement discussions or
alternative dispute resolution or for any
other reason that the complainant and
defendant mutually agree justifies
tolling; or
(B) If complying with the deadline
would violate the due process rights of
a party or would be inconsistent with
fundamental fairness.
(2) For program carriage complaints
that the Chief, Media Bureau refers to an
administrative law judge for an initial
decision, the deadlines set forth in
§ 0.341(f) of this chapter apply.
(j) Remedies for violations—(1)
Remedies authorized. Upon completion
of such adjudicatory proceeding, the
Commission shall order appropriate
remedies, including, if necessary,
mandatory carriage of a video
programming vendor’s programming on
defendant’s video distribution system,
or the establishment of prices, terms,
and conditions for the carriage of a
video programming vendor’s
programming. Such order shall set forth
a timetable for compliance, and shall
become effective upon release, unless
any order of mandatory carriage would
require the defendant multichannel
video programming distributor to delete
existing programming from its system to
accommodate carriage of a video
programming vendor’s programming. In
such instances, if the defendant seeks
review of the staff, or administrative law
judge decision, the order for carriage of
a video programming vendor’s
programming will not become effective
unless and until the decision of the staff
or administrative law judge is upheld by
the Commission. If the Commission
upholds the remedy ordered by the staff
or administrative law judge in its
entirety, the defendant will be required
to carry the video programming
vendor’s programming for an additional
period equal to the time elapsed
between the staff or administrative law
judge decision and the Commission’s
ruling, on the terms and conditions
approved by the Commission.
PO 00000
Frm 00024
Fmt 4701
Sfmt 9990
(2) Additional sanctions. The
remedies provided in paragraph (j)(1) of
this section are in addition to and not
in lieu of the sanctions available under
title V or any other provision of the
Communications Act.
(k) Petitions for temporary standstill.
(1) A program carriage complainant
seeking renewal of an existing
programming contract may file a
petition along with its complaint
requesting a temporary standstill of the
price, terms, and other conditions of the
existing programming contract pending
resolution of the complaint. To allow for
sufficient time to consider the petition
for temporary standstill prior to the
expiration of the existing programming
contract, the petition for temporary
standstill and complaint shall be filed
no later than thirty (30) days prior to the
expiration of the existing programming
contract. In addition to the requirements
of § 76.7, the complainant shall have the
burden of proof to demonstrate the
following in its petition:
(i) The complainant is likely to
prevail on the merits of its complaint;
(ii) The complainant will suffer
irreparable harm absent a stay;
(iii) Grant of a stay will not
substantially harm other interested
parties; and
(iv) The public interest favors grant of
a stay.
(2) The defendant multichannel video
programming distributor upon which a
petition for temporary standstill is
served shall answer within ten (10) days
of service of the petition, unless
otherwise directed by the Commission.
(3) If the Commission grants the
temporary standstill, the adjudicator
deciding the case on the merits (i.e.,
either the Chief, Media Bureau or an
administrative law judge) will provide
for remedies that are applied as of the
expiration date of the previous
programming contract.
[FR Doc. 2011–24240 Filed 9–28–11; 8:45 am]
BILLING CODE 6712–01–P
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]]>Agencies
[Federal Register Volume 76, Number 189 (Thursday, September 29, 2011)]
[Rules and Regulations]
[Pages 60652-60674]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-24240]
[[Page 60651]]
Vol. 76
Thursday,
No. 189
September 29, 2011
Part III
Federal Communications Commission
-----------------------------------------------------------------------
47 CFR Parts 0, 1 and 76
Leased Commercial Access; Development of Competition and Diversity in
Video Programming Distribution and Carriage; Revision of the
Commission's Program Carriage Rules; Final Rule and Proposed Rule
Federal Register / Vol. 76 , No. 189 / Thursday, September 29, 2011 /
Rules and Regulations
[[Page 60652]]
-----------------------------------------------------------------------
FEDERAL COMMUNICATIONS COMMISSION
47 CFR Parts 0, 1, and 76
[MB Docket No. 07-42; FCC 11-119]
Leased Commercial Access; Development of Competition and
Diversity in Video Programming Distribution and Carriage
AGENCY: Federal Communications Commission.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: In 1993, the Federal Communications Commission (FCC) adopted
rules pertaining to carriage of video programming vendors by
multichannel video programming distributors (``MVPDs''), known as the
``program carriage rules.'' The rules are intended to benefit consumers
by promoting competition and diversity in the video programming and
video distribution markets. In this document, the FCC amends its rules
to improve the procedures for addressing complaints alleging violations
of the program carriage rules.
DATES: Effective October 31, 2011, except for Sec. Sec. 1.221(h),
1.229(b)(3), 1.229(b)(4), 1.248(a), 1.248(b), 76.7(g)(2),
76.1302(c)(1), 76.1302 (d), 76.1302(e)(1), and 76.1302(k), which
contain information collection requirements that are not effective
until approved by the Office of Management and Budget. The FCC will
publish a document in the Federal Register announcing the effective
date for those sections.
FOR FURTHER INFORMATION CONTACT: For additional information on this
proceeding, contact David Konczal, David.Konczal@fcc.gov; of the Media
Bureau, Policy Division, (202) 418-2120. For additional information
concerning the Paperwork Reduction Act information collection
requirements contained in this document, contact Cathy Williams at 202-
418-2918, or via the Internet at PRA@fcc.gov.
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Second
Report and Order, FCC 11-119, adopted on July 29, 2011 and released on
August 1, 2011. The full text of this document is available for public
inspection and copying during regular business hours in the FCC
Reference Center, Federal Communications Commission, 445 12th Street,
SW., CY-A257, Washington, DC 20554. This document will also be
available via ECFS (https://www.fcc.gov/cgb/ecfs/). (Documents will be
available electronically in ASCII, Word 97, and/or Adobe Acrobat.) The
complete text may be purchased from the Commission's copy contractor,
445 12th Street, SW., Room CY-B402, Washington, DC 20554. To request
this document in accessible formats (computer diskettes, large print,
audio recording, and Braille), send an e-mail to fcc504@fcc.gov or call
the Commission's Consumer and Governmental Affairs Bureau at (202) 418-
0530 (voice), (202) 418-0432 (TTY).
Paperwork Reduction Act of 1995 Analysis
This document adopts new or revised information collection
requirements subject to the Paperwork Reduction Act of 1995 (PRA),
Public Law 104-13 (44 U.S.C. 3501-3520). The requirements will be
submitted to the Office of Management and Budget (OMB) for review under
section 3507 of the PRA. The Commission will publish a separate notice
in the Federal Register inviting comment on the new or revised
information collection requirements adopted in this document. The
requirements will not go into effect until OMB has approved it and the
Commission has published a notice announcing the effective date of the
information collection requirements. In addition, we note that pursuant
to the Small Business Paperwork Relief Act of 2002, Public Law 107-198,
see 44 U.S.C. 3506(c)(4), we previously sought specific comment on how
the Commission might ``further reduce the information collection burden
for small business concerns with fewer than 25 employees.'' In this
present document, we have assessed the potential effects of the various
policy changes with regard to information collection burdens on small
business concerns, and find that these requirements will benefit many
companies with fewer than 25 employees by promoting the fair and
expeditious resolution of program access complaints. In addition, we
have described impacts that might affect small businesses, which
includes most businesses with fewer than 25 employees, in the Final
Regulatory Flexibility Analysis (``FRFA'') below.
Summary of the Second Report and Order
I. Introduction
1. In 1993, the Commission adopted rules implementing a provision
of the 1992 Cable Act \1\ pertaining to carriage of video programming
vendors by multichannel video programming distributors (``MVPDs'')
intended to benefit consumers by promoting competition and diversity in
the video programming and video distribution markets (the ``program
carriage'' rules).\2\ As required by Congress, these rules allow for
the filing of complaints with the Commission alleging that an MVPD has
(i) Required a financial interest in a video programming vendor's
program service as a condition for carriage; (ii) coerced a video
programming vendor to provide, or retaliated against a vendor for
failing to provide, exclusive rights as a condition of carriage; or
(iii) unreasonably restrained the ability of an unaffiliated video
programming vendor to compete fairly by discriminating in video
programming distribution on the basis of affiliation or nonaffiliation
of vendors in the selection, terms, or conditions for carriage.
Congress specifically directed the Commission to provide for
``expedited review'' of these complaints and to provide for appropriate
penalties and remedies for any violations. Programming vendors have
complained that the Commission's procedures for addressing program
carriage complaints have hindered the filing of legitimate complaints
and have failed to provide for the expedited review envisioned by
Congress.
---------------------------------------------------------------------------
\1\ See Cable Television Consumer Protection and Competition Act
of 1992, Public Law 102-385, 106 Stat. 1460 (1992) (``1992 Cable
Act''); see also 47 U.S.C. 536.
\2\ See Implementation of Sections 12 and 19 of the Cable
Television Consumer Protection and Competition Act of 1992,
Development of Competition and Diversity in Video Programming
Distribution and Carriage, MM Docket No. 92-265, Second Report and
Order 9 FCC Rcd 2642 (1993) (``1993 Program Carriage Order''); see
also Implementation of the Cable Television Consumer Protection And
Competition Act of 1992, Development of Competition and Diversity in
Video Programming Distribution and Carriage, MM Docket No. 92-265,
Memorandum Opinion and Order, 9 FCC Rcd 4415 (1994) (``1994 Program
Carriage Order''). The Commission's program carriage rules are set
forth at 47 CFR 76.1300-76.1302.
---------------------------------------------------------------------------
2. In this Second Report and Order in MB Docket No. 07-42,\3\ we
take initial steps to improve our procedures for addressing program
carriage complaints by \4\:
---------------------------------------------------------------------------
\3\ The initial Notice of Proposed Rulemaking in MB Docket No.
07-42 was released in June 2007 and pertains to both program
carriage and leased access issues. See Leased Commercial Access;
Development of Competition and Diversity in Video Programming
Distribution and Carriage, MB Docket No. 07-42, Notice of Proposed
Rule Making, 22 FCC Rcd 11222 (2007) (``Program Carriage NPRM'').
The Commission released a Report and Order and Further Notice of
Proposed Rulemaking in this docket in February 2008 pertaining only
to leased access issues. See Leased Commercial Access; Development
of Competition and Diversity in Video Programming Distribution and
Carriage, MB Docket No. 07-42, Report and Order, 23 FCC Rcd 2909
(2008), stayed by United Church of Christ, et al. v. FCC, No. 08-
3245 (6th Cir. 2008).
\4\ The new procedures adopted in the Second Report and Order do
not apply to program carriage complaints that are currently pending
or to program carriage complaints that are filed before the
effective date of the new procedures adopted herein. See The Tennis
Channel Inc. v. Comcast Cable Communications, LLC, MB Docket No. 10-
204, File No. CSR-8258-P (filed January 5, 2010); Bloomberg, L.P. v.
Comcast Cable Communications, LLC, MB Docket No. 11-104 (filed June
13, 2011).
---------------------------------------------------------------------------
[[Page 60653]]
Codifying in our rules what a program carriage complainant
must demonstrate in its complaint to establish a prima facie case of a
program carriage violation;
Providing the defendant with 60 days (rather than the
current 30 days) to file an answer to a program carriage complaint;
Establishing deadlines for action by the Media Bureau and
Administrative Law Judges (``ALJ'') when acting on program carriage
complaints; and
Establishing procedures for the Media Bureau's
consideration of requests for a temporary standstill of the price,
terms, and other conditions of an existing programming contract by a
program carriage complainant seeking renewal of such a contract.
3. In the Notice of Proposed Rulemaking in MB Docket No. 11-131, we
seek comment on the following proposed revisions to or clarifications
of our program carriage rules, which are intended to further improve
our procedures and to advance the goals of the program carriage
statute:
Modifying the program carriage statute of limitations to
provide that a complaint must be filed within one year of the act that
allegedly violated the rules;
Revising discovery procedures for program carriage
complaint proceedings in which the Media Bureau rules on the merits of
the complaint after discovery is conducted, including expanded
discovery procedures (also known as party-to-party discovery) and an
automatic document production process, to ensure fairness to all
parties while also ensuring compliance with the expedited resolution
deadlines adopted in the Second Report and Order in MB Docket No. 07-
42;
Permitting the award of damages in program carriage cases;
Providing the Media Bureau or ALJ with the discretion to
order parties to submit their best ``final offer'' for the rates,
terms, and conditions for the programming at issue in a complaint
proceeding to assist in crafting a remedy;
Clarifying the rule that delays the effectiveness of a
mandatory carriage remedy until it is upheld by the Commission on
review, including codifying a requirement that the defendant MVPD must
make an evidentiary showing to the Media Bureau or an ALJ as to whether
a mandatory carriage remedy would result in deletion of other
programming;
Codifying in our rules that retaliation by an MVPD against
a programming vendor for filing a program carriage complaint is
actionable as a potential form of discrimination on the basis of
affiliation and adopting other measures to address retaliation;
Adopting a rule that requires a vertically integrated MVPD
to negotiate in good faith with an unaffiliated programming vendor with
respect to video programming that is similarly situated to video
programming affiliated with the MVPD;
Clarifying that the discrimination provision precludes a
vertically integrated MVPD from discriminating on the basis of a
programming vendor's lack of affiliation with another MVPD; and
Codifying in our rules which party bears the burden of
proof in program carriage discrimination cases.
We also invite commenters to suggest any other changes to our program
carriage rules that would improve our procedures and promote the goals
of the program carriage statute.
II. Background
4. In the 1992 Cable Act, Congress sought to promote competition
and diversity in the video distribution market as well as in the market
for video programming carried by cable operators and other MVPDs.
Congress expressed concern that the market power held by cable
operators would adversely impact programming vendors, noting that
``programmers are sometimes required to give cable operators an
exclusive right to carry the programming, a financial interest, or some
other added consideration as a condition of carriage on the cable
system.'' \5\ Congress also explained that increased vertical
integration in the cable industry could harm programming vendors
because it gives cable operators ``the incentive and ability to favor
their affiliated programmers.'' \6\ Congress concluded that this harm
to programming vendors could adversely affect both competition \7\ and
diversity \8\ in the video programming market, as well as hinder
competition in the video distribution market.\9\
---------------------------------------------------------------------------
\5\ S. Rep. No. 102-92 (1991), at 24, reprinted in 1992
U.S.C.C.A.N. 1133, 1157; see also id. (``[T]he Committee continues
to believe that the operator in certain instances can abuse its
locally-derived market power to the detriment of programmers and
competitors.''); H.R. Rep. No. 102-628 (1992), at 41 (``Submissions
to the Committee also suggest that some vertically integrated MSOs
have agreed to carry a programming service only in exchange for an
ownership interest in the service.'').
\6\ 1992 Cable Act 2(a)(5) (``The cable industry has become
vertically integrated; cable operators and cable programmers often
have common ownership. As a result, cable operators have the
incentive and ability to favor their affiliated programmers. This
could make it more difficult for noncable-affiliated programmers to
secure carriage on cable systems.''); see also S. Rep. No. 102-92
(1991), at 25, reprinted in 1992 U.S.C.C.A.N. 1133, 1158 (``vertical
integration gives cable operators the incentive and ability to favor
their affiliated programming services''); see id. (``For example,
the cable operator might give its affiliated programmer a more
desirable channel position than another programmer, or even refuse
to carry other programmers.''); H.R. Rep. No. 102-628 (1992), at 41
(``Submissions to the Committee allege that some cable operators
favor programming services in which they have an interest, denying
system access to programmers affiliated with rival MSOs and
discriminating against rival programming services with regard to
price, channel positioning, and promotion.'').
\7\ See S. Rep. No. 102-92 (1991), at 25-26, reprinted in 1992
U.S.C.C.A.N. 1133, 1158-59 (``Because of the trend toward vertical
integration, cable operators now have a clear vested interest in the
competitive success of some of the programming services seeking
access through their conduit.''); H.R. Rep. No. 102-628 (1992), at
41 (``[T]he Committee received testimony that vertically integrated
operators have impeded the creation of new programming services by
refusing or threatening to refuse carriage to such services that
would compete with their existing programming services.''); see also
47 U.S.C. 536(a)(3) (requiring the Commission to adopt regulations
prohibiting discrimination on the basis of affiliation that has
``the effect of * * * unreasonably restrain[ing] the ability of an
unaffiliated video programming vendor to compete fairly''); 1993
Program Carriage Order, 9 FCC Rcd at 2643, para. 2 (``Congress
concluded that vertically integrated cable operators have the
incentive and ability to favor affiliated programmers over
unaffiliated programmers with respect to granting carriage on their
systems. Cable operators or programmers that compete with the
vertically integrated entities may suffer harm to the extent that
they do not receive such favorable terms.'').
\8\ See H.R. Rep. No. 102-628 (1992), at 41 (``The Committee
received testimony that vertically integrated companies reduce
diversity in programming by threatening the viability of rival cable
programming services.'').
\9\ In addition to promoting competition and diversity in the
video programming market, the Commission has explained that the
program carriage provision of the 1992 Cable Act is also intended to
promote competition in the video distribution market by ensuring
that MVPDs have access to programming. See 1994 Program Carriage
Order, 9 FCC Rcd at 4419, para. 28 (``[I]n passing section 616,
Congress was concerned with the effect a cable operator's market
power would have both on programmers and on competing MVPDs * *
*.''); see also S. Rep. No. 102-92 (1991), at 23, reprinted in 1992
U.S.C.C.A.N. 1133, 1156 (``In addition to using its market power to
the detriment of consumers directly, a cable operator with market
power may be able to use this power to the detriment of programmers.
Through greater control over programmers, a cable operator may be
able to use its market power to the detriment of video distribution
competitors.'').
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5. To address these concerns, Congress passed section 616 of the
Communications Act of 1934, as amended (the ``Act''), which directs the
Commission to ``establish regulations governing program carriage
agreements and related practices between cable
[[Page 60654]]
operators or other [MVPDs] and video programming vendors.'' \10\
Congress mandated that these regulations shall include provisions
prohibiting a cable operator or other MVPD from engaging in three types
of conduct: (i) ``Requiring a financial interest in a program service
as a condition for carriage on one or more of such operator's systems''
(the ``financial interest'' provision); (ii) ``coercing a video
programming vendor to provide, and from retaliating against such a
vendor for failing to provide, exclusive rights against other [MVPDs]
as a condition of carriage on a system'' (the ``exclusivity''
provision); and (iii) ``engaging in conduct the effect of which is to
unreasonably restrain the ability of an unaffiliated video programming
vendor to compete fairly by discriminating in video programming
distribution on the basis of affiliation or nonaffiliation of vendors
in the selection, terms, or conditions for carriage of video
programming provided by such vendors'' (the ``discrimination''
provision). Section 616 also directs the Commission to (i) ``Provide
for expedited review of any complaints made by a video programming
vendor pursuant to'' section 616; (ii) ``provide for appropriate
penalties and remedies for violations of [section 616], including
carriage''; and (iii) ``provide penalties to be assessed against any
person filing a frivolous complaint pursuant to'' section 616.
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\10\ 47 U.S.C. 536. A ``video programming vendor'' is defined as
``a person engaged in the production, creation, or wholesale
distribution of video programming for sale.'' 47 U.S.C. 536(b).
---------------------------------------------------------------------------
6. In the 1993 Program Carriage Order, the Commission implemented
section 616 by adopting procedures for the review of program carriage
complaints as well as penalties and remedies. In doing so, the
Commission explained that its rules were intended to prohibit the
activities specified by Congress ``without unduly interfering with
legitimate negotiating practices between [MVPDs] and programming
vendors.'' The Commission's procedures generally provide for resolution
of a program carriage complaint in one of four ways: (i) If the Media
Bureau determines that the complainant has not made a prima facie
showing in its complaint of a violation of the program carriage rules,
the Media Bureau will dismiss the complaint; (ii) if the Media Bureau
determines that the complainant has made a prima facie showing and the
record is sufficient to resolve the complaint, the Media Bureau will
rule on the merits of the complaint based on the pleadings without
discovery; (iii) if the Media Bureau determines that the complainant
has made a prima facie showing but the record is not sufficient to
resolve the complaint, the Media Bureau will outline procedures for
discovery before proceeding to rule on the merits of the complaint; and
(iv) if the Media Bureau determines that the complainant has made a
prima facie showing but the disposition of the complaint or discrete
issues raised in the complaint will require resolution of factual
disputes in an adjudicatory hearing or extensive discovery, the Media
Bureau will refer the proceeding or discrete issues arising in the
proceeding for an adjudicatory hearing before an ALJ. The Commission
decided that appropriate relief for violations of the program carriage
rules would be determined on a case-by-case basis, and could include
forfeitures, mandatory carriage, or carriage on terms revised or
specified by the Commission.\11\
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\11\ See 1993 Program Carriage Order, 9 FCC Rcd at 2653, para.
26. Eleven program carriage complaints have been filed in the
approximately two decades since Congress passed section 616 in the
1992 Cable Act, two of which are currently pending before an ALJ or
the Media Bureau. See The Tennis Channel Inc. v. Comcast Cable
Communications, LLC, Hearing Designation Order and Notice of
Opportunity for Hearing for Forfeiture, 25 FCC Rcd 14149 (MB 2010)
(``Tennis Channel HDO''); Bloomberg, L.P. v. Comcast Cable
Communications, LLC, MB Docket No. 11-104 (filed June 13, 2011). In
addition, the Commission has resolved on the merits a program
carriage claim arising through the program carriage arbitration
condition applicable to Regional Sports Networks (``RSNs'') adopted
in the Adelphia Order. See TCR Sports Broadcasting Holding, L.L.P.,
d/b/a Mid-Atlantic Sports Network v. Time Warner Cable Inc., Order
on Review, 23 FCC Rcd 15783 (MB 2008), reversed by Memorandum
Opinion and Order, 25 FCC Rcd 18099 (2010) (``MASN v. Time Warner
Cable''), appeal pending sub nom. TCR Sports Broadcasting Holding,
L.L.P., d/b/a Mid-Atlantic Sports Network v. FCC, No. 11-1151 (4th
Cir.).
---------------------------------------------------------------------------
7. In June 2007, the Commission released the Program Carriage NPRM
seeking comment on revisions to the Commission's program carriage rules
and complaint procedures. The Commission sought comment on whether and
how the processes for resolving program carriage complaints should be
modified; whether the elements of a prima facie case should be
clarified; whether the deadline for resolving the program carriage
complaint at issue in the MASN I HDO or a similar deadline should apply
to all program carriage complaints; and whether additional rules are
necessary to protect programming vendors from potential retaliation for
filing a program carriage complaint.
III. Second Report and Order in MB Docket No. 07-42
8. As discussed below, the record reflects that our current program
carriage procedures are ineffective and in need of reform.\12\ Among
other concerns, programming vendors and other commenters cite
uncertainty concerning the evidence a complainant must provide to
establish a prima facie case, \13\ unpredictable delays in the
[[Page 60655]]
Commission's resolution of complaints,\14\ and fear of retaliation \15\
as impeding the filing of legitimate program carriage complaints. While
MVPDs contend that the limited number of program carriage complaints
filed to date demonstrates that the current procedures are working and
that rule changes are not necessary, \16\ programming vendors contend
that the lack of complaints is a direct result of our inadequate
procedures, not a lack of program carriage claims.\17\ As discussed
below, we take initial steps to improve these procedures by: (i)
Codifying in our rules what a program carriage complainant must
demonstrate in its complaint to establish a prima facie case of a
program carriage violation; (ii) providing the defendant with 60 days
(rather than the current 30 days) to file an answer to a program
carriage complaint; (iii) establishing deadlines for action by the
Media Bureau and an ALJ when acting on program carriage complaints; and
(iv) establishing procedures for the Commission's consideration of
requests for a temporary standstill of the price, terms, and other
conditions of an existing programming contract by a program carriage
complainant seeking renewal of such a contract.
---------------------------------------------------------------------------
\12\ See Ex Parte Reply Comments of HDNet (June 2, 2010) at 6
(``A right without an effective remedy is like having no right at
all. Today, neither MVPDs nor independent programmers have reason to
think that a possible statutory violation will be redressed by the
FCC in a timely and effective manner.''); Comments of Black
Television News Channel, LLC at 4 (``BTNC Comments''); Comments of
National Alliance of Media Arts and Culture et al. at 18-19 (``NAMAC
Comments''); Comments of NFL Enterprises LLC at 6-8 (``NFL
Enterprises Comments''); Comments of The America Channel at 9-11
(``TAC Comments''); Reply Comments of Crown Media Holdings, Inc. at
10-11 (``Hallmark Channel Reply''); Reply Comments of HDNet at 1
(``HDNet Reply''); Reply Comments of National Alliance of Media Arts
and Culture et al. at 18-19 (``NAMAC Reply''); Reply Comments of NFL
Enterprises LLC at 5-6 (``NFL Enterprises Reply''); Reply Comments
of WealthTV at 1-2 (``WealthTV Reply''); see also Letter from
Stephen A. Weiswasser, Counsel for the Outdoor Channel, to Marlene
H. Dortch, Secretary, FCC, MB Docket No. 07-42 (Nov. 16, 2007) at 2
(``Outdoor Channel Nov. 16, 2007 Ex Parte Letter''); Letter from
Larry F. Darby, American Consumer Institute, to Marlene H. Dortch,
Secretary, FCC, MB Docket No. 07-42 (Nov. 20, 2007) at 14 (``ACI
Nov. 20, 2007 Ex Parte Letter''); Letter from David S. Turetsky,
Counsel for HDNet LLC, to Marlene H. Dortch, Secretary, FCC, MB
Docket No. 07-42 (Nov. 20, 2007) at 1-2 (``HDNet Nov. 20, 2007 Ex
Parte Letter''); Letter from Kathleen Wallman, Counsel for National
Association of Independent Networks (``NAIN''), to Marlene H.
Dortch, Secretary, FCC, MB Docket No. 07-42 (June 5, 2008),
Attachment (``NAIN June 5, 2008 Ex Parte Letter''); Letter from John
Lawson, Executive Vice President, ION Media Networks, to Kevin J.
Martin, Chairman, FCC, MB Docket No. 07-42 (Dec. 11, 2008),
Attachment at 1 (``ION Dec. 11, 2008 Ex Parte Letter''). Members of
Congress have also expressed concern with the program carriage
complaint process. See Letter from Kathleen Wallman, Counsel for
WealthTV, to Marlene H. Dortch, Secretary, FCC, MB Docket No. 07-42
(Aug. 4, 2008) (``WealthTV Aug. 4, 2008 Ex Parte Letter'')
(attaching Letter from U.S. Sen. Kay Bailey Hutchison to Kevin J.
Martin, Chairman, FCC (July 27, 2008) at 1 (expressing continued
concern that ``the existing dispute resolution processes are not
encouraging the timely resolution of these disputes or providing the
proper incentives for the parties to negotiate terms'')); id.
(attaching Letter from U.S. Sen. Amy Klobuchar to Kevin J. Martin,
Chairman, FCC (July 24, 2008) at 1 (``Without an effective and
timely FCC process to decide complaints * * * the integrity of any
safeguards against program carriage discrimination is
undermined.'')); Letter from David S. Turetsky, Counsel for HDNet
LLC, to Marlene H. Dortch, Secretary, FCC, MB Docket No. 07-42 (July
22, 2008) (``HDNet July 22, 2008 Ex Parte Letter'') (attaching
Letter from U.S. Sen. Herb Kohl to Kevin J. Martin, Chairman, FCC
(June 23, 2008) at 2 (urging the Commission ``to strengthen the
program carriage rules and to simplify and make more efficient the
process by which program carriage complaints are adjudicated''));
id. (attaching Letter from U.S. Reps. Gene Green, Mike Doyle, and
Charles Gonzalez to Kevin J. Martin, Chairman, FCC (June 30, 2008)
at 1-2 (``The current complaint process is not as efficient as it
could be * * * . [W]e urge you to provide more effective remedies
and streamline the complaint process * * * .'')).
\13\ See TAC Comments at 10; NAMAC Reply at 18-19; WealthTV
Reply at 1; NAIN June 5, 2008 Ex Parte Letter, Attachment at 1;
Letter from Harold Feld, Counsel for NAMAC et al., to Marlene H.
Dortch, Secretary, FCC, MB Docket No. 07-42 (May 2, 2008) at 1
(``NAMAC May 2, 2008 Ex Parte Letter'').
\14\ See Letter from Jonathan D. Blake, Counsel for the National
Football League, to Marlene H. Dortch, Secretary, FCC, MB Docket No.
07-42 (Nov. 5, 2009) at 2 (``Based on the experience in the now-
settled NFL Network/Comcast hearing, the NFL believes that the
Commission's processes are too slow * * *.''); BTNC Comments at 4;
TAC Comments at 9; Letter from David S. Turetsky, Counsel for HDNet,
to Marlene H. Dortch, Secretary, FCC, MB Docket No. 07-42 (June 16,
2010), at 5 (``HDNet June 16, 2010 Ex Parte Letter''); see also
NAMAC Comments at 18; HDNet Reply at 1; NFL Enterprises Reply at 8;
WealthTV Reply at 1; ION Dec. 11, 2008 Ex Parte Letter, Attachment
at 1; NAIN June 5, 2008 Ex Parte Letter, Attachment at 1.
\15\ See BTNC Comments at 4; NAMAC Comments at 18-19; NFL
Enterprises Comments at 8 n.28; NFL Enterprises Reply at 6; NAIN
June 5, 2008 Ex Parte Letter, Attachment at 1.
\16\ See Comments of Comcast Corporation at 27, 33 (``Comcast
Comments''); Comments of the National Cable and Telecommunications
Association at 14-15 (``NCTA Comments''); Comments of Time Warner
Cable Inc. at 27-29 (``TWC Comments''); Reply Comments of Comcast
Corporation at 21-23 (``Comcast Reply''); Reply Comments of the
National Cable and Telecommunications Association at 18-19 (``NCTA
Reply''); Reply Comments of Time Warner Cable Inc. at 2-3 (``TWC
Reply''); Reply Comments of Verizon at 9-10 (``Verizon Reply'').
\17\ See Letter from Stephen A. Weiswasser, Counsel for the
Hallmark Channel, to Marlene H. Dortch, Secretary, FCC, MB Docket
No. 07-42 (Nov. 6, 2007) at 1-2 (``[T]he absence of complaints under
the existing program carriage regime is not evidence of lack of
discrimination, but, to the contrary, a reflection of the
difficulties presented to independents by the high burdens of going
forward under the existing rules and the prospects for retaliation
by MVPDs.'') (``Hallmark Channel Nov. 6, 2007 Ex Parte Letter'');
see also BTNC Comments at 4 (citing fear of retaliation,
unpredictable cost and delay, and uncertainty regarding evidence
required and adequacy of relief as reasons for why few program
carriage complaints have been filed to date); Hallmark Channel Reply
at 11 (``[I]t simply is not the case that only two programmers have
experienced discrimination during the time the rules have been in
effect. The reality is that programmers do not bring complaints
under the existing rules because of their high burden of proof with
respect to predatory practices, the difficulty of fashioning
meaningful resolutions, and the fear of retribution, not because
discrimination does not, in fact, occur.'').
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A. Prima Facie Case
9. In the 1993 Program Carriage Order, the Commission described the
evidence a program carriage complainant must provide in its complaint
to establish a prima facie case. Among other things, the Commission
stated that the ``complaint must be supported by documentary evidence
of the alleged violation, or by an affidavit (signed by an authorized
representative or agent of the complaining programming vendor) setting
forth the basis for the complainant's allegations.'' The Commission
also emphasized that the complaint ``may not merely reflect conjecture
or allegations based only on information and belief.'' The record
reflects that programming vendors are uncertain as to what evidence
must be provided in a complaint to meet the prima facie
requirement.\18\ The National Association of Independent Networks
(``NAIN''), for example, notes that our rules do not contain a
definition of what constitutes a prima facie case and that this lack of
clarity impedes programming vendors from asserting their program
carriage rights through the complaint process.\19\
---------------------------------------------------------------------------
\18\ See TAC Comments at 10 (``[T]here are no clear guidelines
on what constitutes a prima facie case of discrimination.''); NAMAC
Reply at 18-19 (``[T]he current prima facie case requirement
actively prevents the Commission from fulfilling the statutory
command to resolve complaints `expeditiously.' Similarly, evidence
in the record from independent programmers demonstrates that the
prima facie case requirement may dissuade independent programmers
from bringing genuine complaints due to confusion over the
appropriate standard * * *.''); WealthTV Reply at 1 (``It is
critical for independent programmers to know exactly what kind of
evidence, and how much evidence, they need to present to move
forward with a complaint.''); see also HDNet July 22, 2008 Ex Parte
Letter (attaching Letter from U.S. Reps. Gene Green, Mike Doyle, and
Charles Gonzalez to Kevin J. Martin, Chairman, FCC (June 30, 2008)
at 2 (urging the Commission to adopt a ``better defined and more
reasonable definition of a prima facie case''); NAMAC May 2, 2008 Ex
Parte Letter at 1 (``If the Commission elects to retain the prima
facie screen, the Commission must clarify what applicants must prove
to meet this burden * * * .'').
\19\ See NAIN June 5, 2008 Ex Parte Letter, Attachment
(``Currently, there is no definition in the rules of what
constitutes a prima facie case. Consequently, defendants argue their
own versions of the standard to try to get independent programmers'
complaints dismissed. This lack of clarity is a problem for
independent programmers who are in litigation before the Commission,
and for programmers who are contemplating litigation to vindicate
their rights.'').
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10. While one commenter notes that the prima facie step is not
required by the statute and urges the Commission to eliminate this step
entirely,\20\ we believe that retaining this requirement is important
to dispose promptly of frivolous complaints and to ensure that only
legitimate complaints proceed to further evidentiary proceedings. We
agree, however, that clarifying what is required to establish a prima
facie case and codifying these requirements in our rules will help to
reduce uncertainty regarding the prima facie requirement. In the
following paragraphs, we clarify the requirements for establishing a
prima facie case.
---------------------------------------------------------------------------
\20\ See NAMAC Reply at 18 (``[T]he Commission adopted the
requirement to establish a prima facie case solely on the basis of
its own initiative.* * * [N]othing in section 616 requires the
Commission to use a prima facie case requirement to limit the number
of potentially frivolous complaints.'').
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11. As an initial matter, all complaints alleging a violation of
any of the program carriage rules (i.e., the financial interest,
exclusivity, or discrimination provisions) must contain evidence that
(i) the complainant is a video programming vendor as defined in section
616(b) of the Act and Sec. 76.1300(e) of the Commission's rules or an
MVPD as defined in section 602(13) of the Act and Sec. 76.1300(d) of
the Commission's rules; \21\ and (ii) the defendant is an MVPD as
defined in section 602(13) of the Act and Sec. 76.1300(d) of the
Commission's rules. We note that, as originally adopted in the 1993
Program Carriage Order, the Commission's rules provided that a
complaint must contain the ``address and telephone number of the
[[Page 60656]]
complainant, the type of multichannel video programming distributor
that describes the defendant, and the address and telephone number of
the defendant.'' In 1999, the Commission reorganized the part 76
pleading and complaint process rules and, in the course of doing so,
amended this rule to require the complaint to contain the ``type of
multichannel video programming distributor that describes complainant,
the address and telephone number of the complainant, and the address
and telephone number of each defendant.'' We find this revised language
confusing because it fails to reflect that a program carriage
complainant can be either an MVPD or a video programming vendor. We
amend this rule to clarify that the complaint must specify ``whether
the complainant is a multichannel video programming distributor or
video programming vendor, and, in the case of a multichannel video
programming distributor, identify the type of multichannel video
programming distributor, the address and telephone number of the
complainant, what type of multichannel video programming distributor
the defendant is, and the address and telephone number of each
defendant.''
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\21\ See 1993 Program Carriage Order, 9 FCC Rcd at 2654, para.
29; see also 47 U.S.C. 522(13), 536(b); 47 CFR 76.1300(d), (e). In
the 1994 Program Carriage Order, the Commission amended the program
carriage rules to allow MVPDs, in addition to video programming
vendors, to file complaints alleging a violation of the program
carriage rules. See 1994 Program Carriage Order, 9 FCC Rcd at 4418-
20, paras. 24-33. The Commission expressed concern that a video
programming vendor that had been coerced into granting
anticompetitive concessions, including exclusivity, to a cable
operator might be dissuaded from filing a program carriage complaint
based on fears of alienating the cable operator. See id. at 4416,
para. 10 and 4420, paras. 30-31. Accordingly, the Commission amended
its rules to provide MVPDs aggrieved by a violation of section 616
to file a program carriage complaint with the Commission. See id. at
4415, para. 3 and 4418-19, para. 24.
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12. Evidence supporting a program carriage claim may be based on an
explicit or implicit threat.\22\ In complaints alleging a violation of
the exclusivity or financial interest provisions, the complaint must
contain direct evidence (either documentary or testimonial) supporting
the facts underlying the claim. For example, a complainant alleging
that an MVPD has coerced a programming vendor to grant exclusive
carriage rights or required a financial interest in a program service
must provide documentary evidence, such as an e-mail from the defendant
MVPD, documenting the prohibited action, or an affidavit from a
representative of the programming vendor involved in the relevant
carriage negotiations detailing the facts supporting the alleged
violation of the program carriage rules.
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\22\ See 1993 Program Carriage Order, 9 FCC Rcd at 2650, para.
18 (``[W]e reject TCI's suggestion that we should require evidence
of explicit threats, because we believe that actual threats may not
always comprise a necessary condition for a finding of coercion.
Requiring such evidence would establish an unreasonably high burden
of proof that could undermine the intent of section 616 by allowing
multichannel distributors to engage in bad faith negotiations that
apparently would not violate the statute and our regulations simply
because explicit threats were not made during such negotiations. In
contrast, we believe that section 616(a)(2) was intended to prohibit
implicit as well as explicit behavior that amounts to `coercion.'
'').
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13. For complaints alleging a violation of the discrimination
provision, however, direct evidence supporting a claim that the
defendant MVPD discriminated ``on the basis of affiliation or non-
affiliation'' is sufficient to establish this element of a prima facie
case but is not required. For example, an e-mail from the defendant
MVPD stating that the MVPD took an adverse carriage action against the
programming vendor because it is not affiliated with the MVPD will
generally be sufficient to establish this element of a prima facie
case. However, such documentary evidence is highly unlikely to be
available to a programming vendor in advance of discovery, and may not
exist at all.\23\ In addition, an affidavit from a representative of
the programming vendor involved in the relevant carriage negotiations
detailing the facts supporting a claim that a representative of the
defendant MVPD informed the vendor that the MVPD took an adverse
carriage action because the vendor is not affiliated with the MVPD will
generally be sufficient to establish this element of a prima facie
case. Again, however, we recognize that such direct evidence of
affiliation-based discrimination will seldom be available to
complainants and is not required to establish this element of a prima
facie case.
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\23\ See Hallmark Channel Reply at 10 (``[D]iscrimination is
often subtle, and the evidence of its existence is likely outside
the control of an independent programmer.''); NFL Enterprises Reply
at 5-6 (``[T]he best evidence of discriminatory motive is under the
exclusive control of the MVPD * * *. [V]ertically integrated MVPDs
are determined not to provide potential complainants with direct
evidence of the underlying purpose of their discriminatory
conduct.'').
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14. Because it is unlikely that direct evidence of a discriminatory
motive will be available to potential complainants,\24\ we clarify that
a complainant can establish this element of a prima facie case of a
violation of the program carriage discrimination provision by providing
the following circumstantial evidence of discrimination ``on the basis
of affiliation or non-affiliation.'' First, the complainant programming
vendor must provide evidence that it provides video programming that is
similarly situated to video programming provided by a programming
vendor affiliated with the defendant MVPD,\25\ based on a combination
of factors, such as genre, ratings, license fee, target audience,
target advertisers, target programming,\26\ and other factors.\27\ We
emphasize that a finding at the prima facie stage that affiliated and
unaffiliated video programming is similarly situated should be based on
examination of a combination of factors put forth by the complainant.
Although no single factor is necessarily dispositive, the more factors
that are found to be similar, the more likely the programming in
question will be considered similarly situated to the affiliated
programming. On the other hand, it is unlikely that programming would
be considered ``similarly situated'' if only one of these factors is
found to be similar. For example, a complainant is unlikely to
establish a prima facie case of
[[Page 60657]]
discrimination on the basis of affiliation by demonstrating that the
defendant MVPD carries an affiliated music channel targeted to younger
viewers but has declined to carry an unaffiliated music channel
targeted to older viewers with lower ratings and a higher license fee.
Second, the complaint must contain evidence that the defendant MVPD has
treated the video programming provided by the complainant programming
vendor differently than the similarly situated video programming
provided by the programming vendor affiliated with the defendant MVPD
with respect to the selection, terms, or conditions for carriage.\28\
In the absence of direct evidence supporting the claim that the
defendant MVPD discriminated ``on the basis of affiliation or non-
affiliation,'' the circumstantial evidence discussed here will
establish this element of a prima facie case of a violation of the
program carriage discrimination provision.
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\24\ See NFL Enterprises Reply at 6 (stating that requiring only
documentary evidence of improper motive before a programmer can file
a complaint ``would make it extremely difficult to bring any
complaint, since * * * vertically integrated MVPDs are skillful at
ensuring that the best evidence of discrimination--and the only
evidence of discriminatory intent--is found only in the control of
the MVPD''); Outdoor Channel Nov. 16 2007 Ex Parte Letter at 2
(``Because evidence of predatory intent is commonly controlled by
the MVPD, and not the programmer, it is unrealistic to expect a
programmer to have clear evidence of predation before it can bring a
claim.'').
\25\ In the 1993 Program Carriage Order, the Commission
interpreted the discrimination provision in section 616(a)(3) to
require a complainant alleging discrimination that favors an
``affiliated'' programming vendor to provide evidence that the
defendant MVPD has an attributable interest in the allegedly favored
``affiliated'' programming vendor. See 1993 Program Carriage Order,
9 FCC Rcd at 2654, para. 29 (``For complaints alleging
discriminatory treatment that favors `affiliated' programming
vendors, the complainant must provide evidence that the defendant
has an attributable interest in the allegedly favored programming
vendor, as set forth in Sec. 76.1300(a).''); see also 47 CFR
76.1300(a) (``For purposes of this subpart, entities are affiliated
if either entity has an attributable interest in the other or if a
third party has an attributable interest in both entities.'');
Review of the Commission's Cable Attribution Rules, Report and
Order, 14 FCC Rcd 19014, 19063, para. 132 n.333 (1999) (amending
definition of ``affiliated'' in the program carriage rules to be
consistent with definition of this term in other cable rules); but
see NPRM in MB Docket No. 11-131, paras. 72-77 (seeking comment on
whether to interpret the discrimination provision in section
616(a)(3) more broadly to preclude a vertically integrated MVPD from
discriminating on the basis of a programming vendor's lack of
affiliation with another MVPD).
\26\ By ``target programming,'' we refer to programming rights
that a video programming vendor seeks to acquire to display on its
network.
\27\ The Media Bureau will assess on a case-by-case basis
whether the complaint contains evidence to establish at the prima
facie stage that the affiliated and unaffiliated video programming
is similarly situated. In previous cases assessing at the prima
facie stage whether the complaint contains evidence that the
affiliated and unaffiliated video programming is similarly situated,
the Media Bureau has assessed similar factors. See Tennis Channel
HDO, 25 FCC Rcd at 14159-60, paras. 17-18; Herring Broadcasting
Inc., d/b/a WealthTV, et al., Memorandum Opinion and Hearing
Designation Order, 23 FCC Rcd 14787, 14795-97, paras. 12-17 (MB
2008) (``WealthTV HDO''); NFL Enters. LLC v. Comcast Cable
Communications, LLC, Memorandum Opinion and Hearing Designation
Order, 23 FCC Rcd 14787, 14822-23, para. 75 (MB 2008) (``NFL
Enterprises HDO''); TCR Sports Broadcasting Holding, LLP, d/b/a Mid-
Atlantic Sports Network v. Comcast Corp., Memorandum Opinion and
Hearing Designation Order, 23 FCC Rcd 14787, 14835-36, para. 108 (MB
2008) (``MASN II HDO'').
\28\ See Tennis Channel HDO, 25 FCC Rcd at 14160-61, para. 19;
WealthTV HDO, 23 FCC Rcd at 14797, para. 18, 14801, para. 28, 14806,
para. 40, 14812, para. 52; NFL Enterprises HDO, 23 FCC Rcd at 14823,
para. 76; MASN II HDO, 23 FCC Rcd at 14836, para. 109; MASN I HDO,
21 FCC Rcd at 8993-94, para. 11; but see Hutchens Communications,
Inc. v. TCI Cablevision of Georgia, Inc., Memorandum Opinion and
Order, 9 FCC Rcd 4849, 4853, para. 27 (CSB 1994) (finding that
complainant programming vendor did not make a prima facie showing of
discrimination on the basis of affiliation because it failed to
demonstrate that it was offered different price, terms, or
conditions as compared to that offered to an affiliated programming
vendor).
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15. In addition, we note that the program carriage discrimination
provision prohibits only conduct that has ``the effect of * * *
unreasonably restrain[ing] the ability of an unaffiliated video
programming vendor to compete fairly.'' Thus, regardless of whether the
complainant relies on direct or circumstantial evidence of
discrimination ``on the basis of affiliation or non-affiliation,'' the
complaint must also contain evidence that the defendant MVPD's conduct
has the effect of unreasonably restraining the ability of the
complainant programming vendor to compete fairly.\29\
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\29\ See 1993 Program Carriage Order, 9 FCC Rcd at 2648, para.
14 (citing 47 U.S.C. 536(a)(3)). The Media Bureau will assess on a
case-by-case basis whether the complaint contains evidence at the
prima facie stage to establish that the effect of the defendant
MVPD's conduct is to unreasonably restrain the ability of the
complainant video programming vendor to compete fairly. In previous
cases, the Media Bureau has made this assessment based on the impact
of the defendant MVPD's adverse carriage action on the programming
vendor's subscribership, licensee fee revenues, advertising
revenues, ability to compete for advertisers and programming, and
ability to realize economies of scale. See Tennis Channel HDO, 25
FCC Rcd at 14161-62, paras. 20-21; WealthTV HDO, 23 FCC Rcd at
14798, para. 19, 14802, paras. 29-31, 14807-08, paras. 41-42, 14812-
13, paras. 53-54; NFL Enterprises HDO, 23 FCC Rcd at 14823-25,
paras. 77-78; MASN II HDO, 23 FCC Rcd at 14836, para. 110; MASN I
HDO, 21 FCC Rcd at 8993-94, para. 11.
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16. We emphasize that a Media Bureau finding that a complainant has
established a prima facie case does not mean that the complainant has
proven its case or any elements of its case on the merits. Rather, a
prima facie finding means that the complainant has provided sufficient
evidence in its complaint, without the Media Bureau having considered
any evidence to the contrary, to proceed. If the complainant
establishes a prima facie case but the record is not sufficient to
resolve the complaint, the adjudicator (i.e., either the Media Bureau
or an ALJ) will allow the parties to engage in discovery \30\ and will
then conduct a de novo examination of all relevant evidence on each
factual and legal issue. For example, although the Media Bureau may
find that a complaint contains sufficient evidence to establish a prima
facie case that a defendant MVPD's conduct has the effect of
unreasonably restraining the ability of the complainant programming
vendor to compete fairly, thus allowing the case to proceed, the
adjudicator when ruling on the merits may reach an opposite conclusion
after conducting further proceedings and developing a more complete
evidentiary record.\31\
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\30\ Under the current program carriage rules, discovery is
Commission-controlled, meaning that Media Bureau staff identifies
the matters for which discovery is needed and then issues letters of
inquiry to the parties on those matters or requires the parties to
produce specific documents related to those matters. See 1993
Program Carriage Order, 9 FCC Rcd at 2655-56, para. 32; see also id.
at 2652, para. 23 (providing that discovery will ``not necessarily
be permitted as a matter of right in all cases, but only as needed
on a case-by-case basis, as determined by the staff''); see also 47
CFR 76.7(f). In the NPRM in MB Docket No. 11-131, we propose to
revise these procedures by providing for expanded discovery, whereby
parties to a program carriage complaint may serve requests for
discovery directly on opposing parties rather than relying on the
Media Bureau staff to seek discovery through letters of inquiry or
document requests. See NPRM in MB Docket No. 11-131, paras. 42-43.
We also seek comment on an automatic document production process
whereby both parties would have a certain period of time after the
Media Bureau's prima facie determination to produce basic threshold
documents listed in the Commission's rules that are relevant to the
program carriage claim at issue. See NPRM in MB Docket No. 11-131,
paras. 44-47.
\31\ Compare WealthTV HDO, 23 FCC Rcd 14787 with Herring
Broadcasting Inc., d/b/a WealthTV, et al., Recommended Decision, 24
FCC Rcd 12967 (Chief ALJ Sippel 2009) (``WealthTV Recommended
Decision'') and Herring Broadcasting Inc., d/b/a WealthTV, et al.,
Memorandum Opinion and Order, FCC 11-94 (2011) (``WealthTV
Commission Order''). We note, however, the Media Bureau in the
course of making a prima facie determination may rule on the merits
of certain elements of the case based on the pleadings and refrain
from referring these specific issues for further evidentiary
proceedings. For example, to the extent that the parties concede
that the complainant is a video programming vendor and the defendant
is an MVPD, further evidentiary proceedings on these issues are
unnecessary.
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17. We also clarify that the Media Bureau's determination of
whether a complainant has established a prima facie case is based on a
review of the complaint (including any attachments) only. If the Media
Bureau determines that the complainant has established a prima facie
case, the Media Bureau will then review the answer (including any
attachments) and reply to determine whether there are procedural
defenses that might warrant dismissal of the case (e.g., arguments
pertaining to the statute of limitations); whether there are any issues
that the defendant MVPD concedes; whether there are substantial and
material questions of fact as to whether the defendant MVPD has engaged
in conduct that violates the program carriage rules; whether the case
can be addressed by the Media Bureau on the merits based on the
pleadings or whether further evidentiary proceedings are necessary; and
whether the proceeding should be referred to an ALJ in light of the
nature of the factual disputes. For example, if the Media Bureau
determines that the complainant has established a prima facie case but
the defendant MVPD provides legitimate and non-discriminatory business
reasons in its answer for its adverse carriage decision, the Media
Bureau might conclude that there are substantial and material questions
of fact that warrant allowing the parties to engage in discovery or
referring the matter to an ALJ for an adjudicatory hearing, or it might
conclude that the complaint can be resolved on the merits based on the
pleadings.
B. Deadline for Defendant's Answer to a Program Carriage Complaint
18. Our current rule provides that an MVPD served with a program
carriage complaint shall answer the complaint within 30 days of
service. We amend this rule to provide an MVPD with 60 days to answer a
program carriage complaint.\32\ Having established specific evidentiary
requirements for what the complainant must provide in its
[[Page 60658]]
complaint to establish a prima facie case of a program carriage
violation, we believe it is appropriate to provide the defendant with
additional time to answer the complaint in order to develop a full,
case-specific response, with supporting evidence, to the evidence put
forth by the complainant. As discussed in the next section, Congress
directed the Commission to ``provide for expedited review'' of program
carriage complaints, and we adopt deadlines herein for the Media Bureau
and ALJs when acting on program carriage complaints to satisfy this
requirement. Providing additional time for a defendant to file an
Answer to a complaint does not conflict with this requirement. By
requiring a complainant to provide specific evidence in its complaint
and providing a defendant with additional time to respond to this
evidence and provide specific evidence supporting its response, the
rules we adopt today will allow for the development of a more robust
factual record earlier in the complaint process than under our current
rules. We believe that this will better enable the Media Bureau to
either resolve cases on the merits based on the pleadings without
referring the matter to an ALJ, or narrow the factual issues in dispute
that warrant discovery or referral to an ALJ. As a result, this will
lead to the more expeditious resolution of disputes than under other
current program carriage complaint procedures.
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\32\ See Letter from Ryan G. Wallach, Counsel for Comcast, to
Marlene H. Dortch, Secretary, FCC, MB Docket No. 07-42 (Dec. 10,
2008), Attachment at 2 (urging the Commission to allow defendants 60
days to file an answer); Letter from Arthur H. Harding, Counsel for
Time Warner Cable, to Marlene H. Dortch, Secretary, FCC, MB Docket
No. 07-42 (June 1, 2011), at 2 (stating that a program carriage
defendant needs a full and fair opportunity to respond to a
complaint) (``Time Warner Cable June 1 2011 Ex Parte Letter'').
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C. Deadlines for Media Bureau and ALJ Decisions
19. The record reflects that the unpredictable and sometimes
lengthy time frames for Commission action on program carriage
complaints have discouraged programming vendors from filing
complaints.\33\ Both programming vendors \34\ and MVPDs support
expeditious action on program carriage complaints. We believe that
establishing deadlines for the Media Bureau and ALJs when acting on
program carriage complaints will help to resolve disputes quickly and
efficiently and thus fulfill our statutory mandate to ``provide for
expedited review'' of program carriage complaints. While the Commission
in the 1993 Program Carriage Order directed both the Media Bureau and
ALJs to resolve cases ``expeditiously,'' we now conclude that a
specific deadline codified in our rules is needed to ensure that this
goal is achieved.\35\
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\33\ See TAC Comments at 9 (``Faced with the likelihood of FCC
inaction, combined with the real risk of retaliation by cable
operators, [] no independent channel would want to file with the
FCC.''); HDNet June 16 2010 Ex Parte Letter at 5 (``Independent
programmers simply cannot commence proceedings against potential
carriers, even in cases of clear misconduct, unless these
proceedings are truly expedited, as Congress directed, because they
risk retaliation and, for some independent programmers, financially
ruinous delays in acquiring carriage for their programming.''); see
also BTNC Comments at 4.
\34\ See TAC Comments at 9 (requesting that the Commission
provide a ``shot clock,'' such as a requirement that the Commission
hear and resolve the complaint within 60 to 90 days); NFL
Enterprises Reply at 8 (explaining that, given the time-sensitivity
of program carriage disputes, it is critical that the Commission
adopt a streamlined complaint process and an expedited timeline for
dispute resolution); HDNET Reply at 1 (endorsing an expedited
complaint resolution process); WealthTV Reply at 1 (same); see also
NAMAC Comments at 18; ION Dec. 11 2008 Ex Parte Letter, Attachment
at 1; NAIN June 5 2008 Ex Parte Letter, Attachment at 1; HDNet July
22 2008 Ex Parte Letter (attaching Letter from U.S. Sen. Herb Kohl
to Kevin J. Martin, Chairman, FCC (June 23, 2008) at 2 (``I urge
that the FCC set a deadline by which program carriage complaints by
programmers be decided in prompt and reasonable time * * *.'')); id.
(attaching Letter from U.S. Sen. Byron L. Dorgan to Kevin J. Martin,
Chairman, FCC (June 13, 2008) at 1 (``I worry that while the FCC has
a shot clock for consideration of forbearance petitions, in a
separate area of programming discrimination, the Commission lacks
any type of timeline.'')); id. (attaching Letter from U.S. Reps.
Gene Green, Mike Doyle, and Charles Gonzalez to Kevin J. Martin,
Chairman, FCC (June 30, 2008) at 2 (urging the Commission to adopt a
``shot clock'')).
\35\ See 1993 Program Carriage Order, 9 FCC Rcd at 2655-56,
para. 32 (directing Media Bureau staff to ``develop a discovery
process and timetable to resolve the dispute expeditiously''); see
id. at 2656, para. 34 (``ALJs are expected to resolve program
carriage complaints expeditiously, and should hold an immediate
status conference to establish timetables for discovery, hearing and
submission of briefs and proposed findings of fact and conclusions
of law.'').
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20. Action on program carriage complaints entails a two-step
process: The initial prima facie determination by the Media Bureau,
followed (if necessary) by a decision on the merits by an adjudicator
(i.e., either the Media Bureau or an ALJ).\36\ We adopt deadlines
herein for both of these steps. For the first step, we direct the Media
Bureau to release a decision determining whether the complainant has
established a prima facie case within 60 calendar days after the
complainant's reply to the defendant's answer is filed (or the date on
which the reply would be due if none is filed). Based on our past
experience in addressing program carriage complaints, we believe that
60 calendar days after the complainant files its reply \37\ provides
sufficient time for the Media Bureau to make a prima facie
determination while providing for the ``expedited review'' required by
Congress. In light of this expedited timeframe for the Media Bureau's
prima facie determination, we again emphasize that complainants should
not raise new matters in a reply \38\ and that additional pleadings
outside of the pleading cycle will not be accepted.\39\
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\36\ A potential third step applies to the extent a party
appeals the decision of the Media Bureau or an ALJ to the
Commission. See 47 CFR 1.115, 76.10(c)(1) (pertaining to
Applications for Review of actions taken on delegated authority); 47
CFR 1.276, 76.10(c)(2) (pertaining to exceptions to initial
decisions of an ALJ). We decline at this time to establish a
deadline for Commission action on review of decisions by the Media
Bureau or an ALJ.
\37\ As amended herein, the program carriage rules provide for a
80-calendar-day initial pleading cycle (i.e., a 60-calendar-day
period for filing an answer to a complaint and a 20-calendar-day
period for filing a reply to the answer). See 47 CFR 76.1302(e)(1),
(f).
\38\ See 47 CFR 76.1302(e) (stating that a reply ``shall be
responsive to matters contained in the answer and shall not contain
new matters'').
\39\ See 1993 Program Carriage Order, 9 FCC Rcd at 2652, para.
23 (``Given the statute's explicit direction to the Commission to
handle program carriage complaints expeditiously, additional
pleadings will not be accepted or entertained unless specifically
requested by the reviewing staff.''); see id. at 2654-55, para. 30
n.51 (``[U]nless specifically requested by the Commission or its
staff, additional pleadings such as motions
