Court Tosses Most of FCC’s Ownership Rules

WASHINGTON, D.C. A federal appeals court has invalidated much of last year’s decision by the Federal Communications Commission to relax media ownership rules and continued a stay to keep any of the FCC’s proposed changes from taking effect.

The action by the Third U.S. Circuit Court of Appeals in Philadelphia on Thursday amounted to a setback for broadcasters seeking to expand, and for some newspaper companies that are eager to combine with nearby TV stations. It stood as a victory for critics who said the FCC decision would allow a dangerous concentration of media that could throttle the robust debate needed to keep democracy healthy.

The court, in a 124-page opinion, told the FCC to reconsider cross-ownership rules that would have permitted more combinations of daily newspapers and radio and TV outlets in the same markets. It also sent back rules that would let broadcasters own two or even three TV stations in a market.

The court upheld the FCC’s refusal to prevent affiliates that rank in the top four in a local market from having a common owner.

FCC chairman Michael Powell said the ruling “created a clouded and confused state of media law.” He said the court was substituting its judgment for that of the expert agency, the FCC.

FCC critics praised the court’s action. “This is a complete repudiation of rules that would allow one or two media giants to dominate the most important sources of local news and information in almost every community in America,” said Gene Kimmelman, senior public policy director for Consumers Union.

Big media companies that stand to lose an opportunity to expand did not immediately issue statements. The National Association of Broadcasters said it needed time to study the decision.

The decision means that the FCC probably cannot issue new rules for the court’s scrutiny before the fall elections, which could result in new leadership at the agency, depending on the outcome of the presidential election, said Legg Mason analyst Blair Levin.