roundtable: Bell Atlantic 4th Circuit oral arguments (fwd)

roundtable: Bell Atlantic 4th Circuit oral arguments (fwd)

Bell Atlantic 4th Circuit oral arguments (fwd)

James Love (love@essential.org)
Fri, 11 Feb 1994 01:55:02 -0500 (EST) 

Date: Fri, 11 Feb 1994 01:55:02 -0500 (EST)
From: James Love <love@essential.org>
Subject: Bell Atlantic 4th Circuit oral arguments (fwd)
To: roundtable@cni.org
Message-Id: <Pine.3.85.9402110102.C502-0100000@essential>


---------- Forwarded message ----------
Date: Tue, 8 Feb 1994 10:09:28 -0600
From: Barry Orton <borton@macc.wisc.edu>
To: Multiple recipients of list <telecomreg@relay.adp.wisc.edu>
Subject: Bell Atlantic 4th Circuit oral arguments


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Volume 1, Number 2                          (c) 1994 Mark Voorhees
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Sharing the spotlight
CABLE LAWYER FARR BUTTRESSES DEFENSE OF TELCO-VIDEO BAN BEFORE
4TH CIRCUIT

February 7, 1994--There are few lawyers as quick and solid on
their feet as Harvard Law professor Laurence Tribe. One them is
H. Bartow Farr III of Farr, Smith & Taranto.

 The Justice Department today wisely shared the stage today with
Farr before the Fourth Circuit, which will decide whether
District Court judge T.S. Ellis III was correct in throwing out
the 1984 ban prohibiting Bell Atlantic Corp. from the cable
programming business.

 Farr, counsel to the National Cable Television Association, held
his own against Tribe, Bell Atlantic's lawyer, and left the
three-judge panel with ample reason to reverse Ellis and restore
the ban.

 At an all-day hearing in June before Ellis, Tribe ran circles
around lawyers for the Justice Department and NCTA. Not so today.
Tribe was as animated, articulate, and persuasive as always. But
so was Farr, who was coming off an equally effective performance
on behalf of the NCTA before the U.S. Supreme Court in January
fighting the must-carry cable law. In that case, Solicitor
General Drew Days III declined to share his time with broadcast
lawyer Bruce Ennis, who could have buttressed the government's
case.

 In the Bell Atlantic case, Farr replaced Bruce Sokler of Mintz,
Levin, Cohn, Ferris, Glovsky & Popeo, who argued at the district
court.

 Will Farr's performance matter? The answer resides only in the
hearts and minds of the three judges on the 4th Circuit panel.
Two of the judges, Norwood Tilley, Jr., and Donald Russell,
simply listened without asking questions. And the questions of
judge Michael suggest a preference for Bell Atlantic's case.

 The only certainty is that Farr presented the judges a clear
path for reversing Ellis. It's up to them whether they take it.

 Bell Atlantic argues that the 1984 ban violates the First
Amendment. The ban prohibits telephone companies from providing
video programming to their telephone customers. The government
and cable trade association contend that the ban prevents
telephone companies from using their control of local phone loop
to discriminate against other cable programmers and operators or
to pass along video costs to telephone rate payers.

 In a decision in August, Ellis ruled that the ban violated the
intermediate First Amendment balancing tests set forth in the
famous O'Brien (draft-card burning) and Ward (decibel level at
outdoor rock concert) cases. Those cases allow governmental
regultions that incidentally affects speech if the regulation is
targeted and not overly broad. The ban, he ruled, failed to
address the government's concerns.

 Ellis determined that the risk of discrimination and
cross-subsidy existed with the transport of video signals, which
Bell Atlantic is already allowed to provide, rather than the
creation of programming, which the 1984 ban prohibits. He threw
out the ban, arguing that Bell is already free to try to do what
the law is meant to stop.

 Farr met that contention head on by artfully arguing that the
distinction between carriage and content is artificial when the
same company is providing both. Bell Atlantic has a greater
incentive to engage in economic mischief, Farr said, if it is
retailing programming services against an incumbent cable
operator than if it is simply carrying third-party programming.

 "Everyone recognizes that there are additional risks once you
enter the retail business," he told the judges. Even lawmakers
and governmental bodies that favor telephone company entry into
the cable business propose safeguards aimed at those heightened
risks, he added.

 Tribe answered that argument, which he called a "complicated
incentive scheme," in two ways. First, telephone companies have
not engaged in wrongdoing in the provision of non-video
information services, for which they are the only distributor.
Second, there is nothing about making editorial choices that
increases the risk of cross subsidy.

 Farr's strongest moment on his feet was his last, during
rebuttal. He told the judges that there are three ways they could
uphold Ellis's ruling and then countered all three.

 1) They could decide Ellis was correct that the ban did not fit
the governmental concern. "The short answer" to that opinion,
Farr said, is that even lawmakers who today are considering
opening the cable business to telephone company entry recognize
the cross-subsidy risk and are building safeguards into their
proposed bills.

 2) They could decide that Ellis was wrong about the absence of
risks but that a total ban was still the wrong means. Noting that
under the O'Brien standard, the government is not obligated to
choose the least restrictive means, Farr said, "No one has
suggested that safeguards as just as effective as a direct
prohibition."

 3) The judges could decide Ellis should have subjected the ban
to strict scrutiny, a constitutional standard nearly impossible
to overcome, rather than the intermediate level scrutiny of
O'Brien and Ward. That argument, however, rests on the "old
constitutional canard that you cannot ban something and stay
within the First Amendment."

 The Supreme Court case, City of Los Angeles v. Vincent, dispels
with that myth, Farr said. The Supreme Court said that Los
Angeles could ban posters on public property so long as it was
not singling out content or a particular type of poster.

 Significantly, Farr and Bruce Forrest, the Justice lawyer,
implicitly recognized the ultimate futility of their efforts to
keep telephone companies at bay. Their arguments acknowledge and
even draw strength from the efforts underway in Congress to
permit what the 1984 ban prohibits. By saying that even today's
congressional initiatives propose safeguards to control the
potential abusive powers of phone companies, Farr and Forrest
admit that the day may come when phone companies will enter the
cable business. But, Forrest added, "Congress has decided that
telephone companies should not be the vehicle--yet."

 The momentum to allow that entry was provoked in part by the
wake-up call of Ellis's ruling. Even if Ellis is overruled, he
will have still helped to light the fuse that will ignite the
largest explosion in telecommunications since divestiture.

******************************

 The cable trade association has been standing on both sides of
the First Amendment for more than a year now. It has fought the
speech rights of the telephone companies, while arguing that the
First Amendment should protect its members from the reach of the
must-carry cable law. Until today, the NCTA did not address that
dichotomy directly.

 Judge Michael asked Farr whether the judges should wait for the
Supreme Court ruling in the must-carry case. "If you win
must-carry, do you lose here?" he asked.

 Farr naturally disagreed, arguing that the video ban was
unencumbered with the fatal flaw of the must-carry law: a
governmental preference for one type of content, which in the
Supreme Court case is broadcast and public programming. 

*******************************

 Tribe forgot momentarily that he was in the courtroom and not
the classroom. When judge Michael suggested that the government's
fear of cross-subsidy might be valid, Tribe countered, as if he
was testing a student, "Why's that?" When the audience began to
laugh, Tribe quickly backtracked and explained the folly of the
government's fears.






                                                                           
             
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