The U.S. Court of Appeals for the District of Columbia on Friday upheld a decision the Federal Communications Commission made last year to close the "terrestrial loophole" that had allowed cable TV providers to withhold local programming distributed over land-based networks from competing satellite TV providers.
In a petition that requested a review of the FCC’s January 2010 decision, the National Cable & Telecommunications Association, New York-based Cablevision Systems Corp. and others opponents said that the FCC lacked authority to regulate terrestrially transmitted programming and that the order violated the free speech rights.
The court disagreed.
“We see nothing in the statute that unambiguously precludes the commission from extending its program access rules to terrestrially delivered programming. Nor do we see any merit in petitioners’ contention that the Commission’s rules violate the First Amendment.”
The Cable Television Consumer Protection and Competition Act of 1992 prohibits exclusive dealing arrangements and other related anticompetitive practices for satellite programming, but before last year’s FCC order, none of these restrictions applied to the withholding of terrestrial programming, which generally includes regional sports networks.
The court, however, said the FCC must re-examine its decision that exclusivity is always unfair.
“The commission needs to consider whether there are relevant differences between satellite and terrestrial programming before invoking Congress’s regulation of satellite withholding as a justification for treating terrestrial withholding as categorically unfair,” the court said.
