Supreme Court declines to review cable limit case

Monday, December 3rd 2001, 12:00 am
By: News On 6

WASHINGTON (AP) _ The Supreme Court, turning aside pleas from consumer groups, refused on Monday to consider reinstating government restrictions on the number of subscribers that cable companies can have.

The case turns on arguments by consumer groups who fear the possibility of a cable monopoly. The groups argued that, under present laws and government rules, one or two companies could control programming in most American homes.

The refusal was not unexpected. The Bush administration had urged justices to turn down the case because federal regulators are working on a second set of rules to address monopoly concerns.

An appeals court had ruled earlier this year that the Federal Communications Commission's first rules were unconstitutional.

Consumer groups said that since that decision, there has been talk of more consolidation in an industry that is already dominated by a few large companies. The largest, AT&T, serves about 40 percent of cable and satellite subscribers.

``The very dangers Congress foresaw and sought to prevent are now rapidly coming to pass,'' attorney Andrew Jay Schwartzman said in urging the court to take the case. ``Hamstringing the flexibility of the FCC prevents it from properly balancing the competing free speech interests implicated in this case.''

The cable companies contend that subscriber limits infringe on their First Amendment speech rights by restricting their audience size.

Lawyers for AT&T and Time Warner said the U.S. Court of Appeals for the District of Columbia was right that the FCC did not have evidence of ``a realistic collusion risk.''

``Even ignoring that this fact-bound conclusion should be of no interest to this court, it was unquestionably correct,'' industry lawyer Henk Brands told the court in filings.

At the time of the appeals court decision, AT&T was in violation of the rule that forbids one company from serving more than 30 percent of all cable and satellite subscribers. The court also questioned FCC limits on how many channels cable operators can fill with programming in which they have a financial interest.

The appeals court ordered the commission to review the rules again.

Solicitor General Theodore Olson said that review process has started, and the FCC is seeking economic evidence to determine the need for rules. He said Supreme Court review now is ``premature and potentially unnecessary''

Olson also said the dynamics of the industry have changed with the growing popularity of satellite television

The National Association of Broadcasters supported the consumer groups, and told the court that cable companies use First Amendment arguments to contest ``virtually any type of economic regulations.''

The case is Consumer Federation of America v. Federal Communications Commission, 01-223.