Cbs Corporation v. FCC

PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
___________
No. 06-3575
___________
CBS CORPORATION;
CBS BROADCASTING INC.;
CBS TELEVISIONSTATIONS INC.;
CBS STATIONS GROUP OF TEXAS L.P.;
and KUTV HOLDINGS, INC.,
Petitioners
v.
FEDERAL COMMUNICATIONS COMMISSION;
UNITED STATES OF AMERICA,
Respondents
_______________________
Petition for Review of Orders of the
Federal Communications Commission
FCC Nos. 06-19 and 06-68
______________
Argued September 11, 2007
Decided July 21, 2008
Certiorari Granted, Judgment Vacated and Remanded
from the Supreme Court of the United States
May 4, 2009
Argued on Remand from the
Supreme Court of the United States
February 23, 2010
Before: SCIRICA, RENDELL and FUENTES,
Circuit Judges
(Opinion Filed November 2, 2011)
_____________
Robert Corn-Revere, Esq. (ARGUED)
Davis Wright Tremaine LLP
1919 Pennsylvania, N.W., Suite 200
Washington, D.C. 20005
Jerome J. Shestack, Esq.
WolfBlock
1650 Arch Street, 22nd Floor
Philadelphia, Pennsylvania 19103
Nancy Winkelman, Esq.
Schnader Harrison Segal & Lewis
1600 Market Street, Suite 3600
Philadelphia, Pennsylvania 19103
Counsel for Petitioners
Jacob M. Lewis, Esq. (ARGUED)
Joseph R. Palmore, Esq.
Nandan M. Joshi, Esq.
2
Federal Communications Commission
Office of General Counsel
445 12th Street, S.W.
Washington, D.C. 20554
Eric D. Miller, Esq.
Thomas M. Bondy, Esq.
United States Department of Justice
Civil Division
950 Pennsylvania Avenue, N.W., Room 5634
Washington, D.C. 20530
Counsel for Respondents
John B. Morris, Jr., Esq.
Center for Democracy & Technology
1634 I Street, N.W., Suite 1100
Washington, D.C. 20006
Counsel for Amici Curiae-Petitioners,
Center for Democracy & Technology and
Adam Thierer, Senior Fellow,
The Progress & Freedom Foundation
Andrew J. Schwartzman, Esq.
Media Access Project
1625 K Street, N.W., Suite 1000
Washington, D.C. 20006
Counsel for Amicus Curiae-Petitioner,
Center for Creative Voices in Media, Inc.
Carter G. Phillips, Esq.
Sidley Austin LLP
1501 K Street, N.W.
Washington, D.C. 20005
3
Counsel for Amicus Curiae-Petitioner,
Fox Television Stations, Inc.
Christopher T. Craig, Esq.
Sparks & Craig LLP
6862 Elm Street, Suite 360
McLean, Virginia 22101
Counsel for Amicus Curiae-Respondents,
Parents Television Council, Inc.
Thomas B. North
Pro Se Amicus Curiae-Respondent
David P. Affinito, Esq.
Dell'Italia Affinito & Santola
18 Tony Galento Plaza
Orange, New Jersey 07050
Counsel for Amicus Curiae-Respondent,
Morality In Media, Inc.
Steven H. Aden, Esq.
Alliance Defense Fund
801 G Street, N.W., Suite 509
Washington, D.C. 20001
Counsel for Amici Curiae-Respondents,
Focus on the Family, Morality In Media, Inc.
and Family Research Council
_________________
OPINION OF THE COURT
_________________
4
RENDELL, Circuit Judge.
This matter comes before us on remand from the
United States Supreme Court in light of its ruling in F.C.C. v.
Fox Television Stations, Inc., 129 S. Ct. 1800 (2009). This
case, like Fox, involves a tightening of the Federal
Communications Commission‘s standards for the broadcast
of fleeting indecent material. Fox concerned the FCC‘s
decision to abandon its safe harbor for expletives that are not
repeated; this case considers the FCC‘s departure from its
earlier policy exempting fleeting images from the scope of
actionable indecency. While we can understand the Supreme
Court‘s desire that we re-examine our holdings in light of its
opinion in Fox — since both involve the FCC‘s policy
regarding ―fleeting material‖ — in Part A of this opinion we
conclude that, if anything, Fox confirms our previous ruling
in this case and that we should readopt our earlier analysis
and holding that the Commission acted arbitrarily in this case.
See CBS Corp. v. F.C.C., 535 F.3d 167 (3d Cir. 2008),
vacated by F.C.C. v. CBS Corp., 129 S. Ct. 2176 (2009).
Accordingly, in Part B of this opinion we again set forth our
reasoning and conclusion that the FCC failed to acknowledge
that its order in this case reflected a policy change and
improperly imposed a penalty on CBS for violating a
previously unannounced policy. See id. at 188-89. We have
reconsidered certain other aspects of our previous opinion and
will not remand, but, instead, will rule in Part B that CBS‘s
petition for review is granted in toto.
5
Part A: Our Prior Opinion and the Impact of Fox
I.
The treatment of fleeting indecency over the airwaves
has been the subject of much consideration by the FCC and
the courts over the last thirty years. This case involves a
February 1, 2004 incident: the exposure, for nine-sixteenths
of one second, of Janet Jackson‘s bare right breast during the
live halftime performance of the National Football League‘s
Super Bowl XXXVIII.1 The FCC issued a forfeiture order
against CBS in March 2006, imposing a penalty of $550,000.
See In re Complaints Against Various Television Licensees
Concerning Their February 1, 2004 Broadcast of the Super
Bowl XXXVIII Halftime Show, 21 F.C.C.R. 2760 (2006)
(―Forfeiture Order‖). We described the FCC‘s reasoning in
our previous opinion:
Affirming its preliminary findings, the
Commission concluded the Halftime Show
broadcast was indecent because it depicted a
sexual organ and violated ―contemporary
community standards for the broadcast
medium.‖ Id. at ¶ 10. In making this
determination, the FCC relied on a contextual
analysis to find the broadcast of Jackson‘s
exposed breast was: (1) graphic and explicit, (2)
shocking and pandering, and (3) fleeting. Id. at
¶ 14. It further concluded that the brevity of the
1
Our original opinion in this matter provided additional
factual and procedural background. See CBS Corp., 535 F.3d
at 171-74.
6
image was outweighed by the other two factors.
Id. The standard applied by the Commission is
derived from its 2001 policy statement setting
forth a two-part test for indecency: (1) ―the
material must describe or depict sexual or
excretory organs or activities,‖ and (2) it must
be ―patently offensive as measured by
contemporary community standards for the
broadcast medium.‖ In re Industry Guidance
on the Commission's Case Law Interpreting 18
U.S.C. § 1464 and Enforcement Policies
Regarding Broadcast Indecency, 16 F.C.C.R.
7999, 8002 ¶¶ 7-8 (2001) (emphasis in original)
....
Additionally, the FCC determined CBS‘s
actions in broadcasting the indecent image were
―willful‖ and therefore sanctionable by a
monetary forfeiture under 47 U.S.C. §
503(b)(1). See Forfeiture Order at ¶ 15.
CBS Corp., 535 F.3d at 172. CBS sought reconsideration
under 47 C.F.R. § 1.106, which the FCC denied. See In re
Complaints Against Various Television Licensees Concerning
Their February 1, 2004 Broadcast of the Super Bowl XXXVIII
Halftime Show, 21 F.C.C.R. 6653 (2006). Neither of these
two orders acknowledged, much less explained, any change
in the FCC‘s enforcement policy for fleeting indecent images.
CBS filed a petition for review in our Court,
contending that the FCC‘s ruling that the fleeting nude image
was actionable indecency constituted a change in policy, and
its application to CBS was, therefore, arbitrary and capricious
7
under the Administrative Procedure Act (―APA‖), 5 U.S.C. §
706. Specifically, CBS urged that, before the incident in
question, FCC policy provided that the ―isolated use of
expletives in broadcasts did not constitute actionable
indecency under 18 U.S.C. § 1464.‖ CBS Corp., 535 F.3d at176 (citing See In re Application of Pacifica Found., 95
F.C.C.2d 750 (1983)).
The FCC defended its actions on the basis that its
earlier fleeting-material policy applied only to fleeting
utterances and did not extend to fleeting images.2 We
rejected this contention:
During a span of nearly three decades, the
Commission frequently declined to find
broadcast programming indecent, its restraint
punctuated only by a few occasions where
programming contained indecent material so
pervasive as to amount to ―shock treatment‖ for
the audience. Throughout this period, the
Commission consistently explained that isolated
or fleeting material did not fall within the scope
of actionable indecency.
2
The FCC abandoned its ―restrained enforcement policy for
fleeting broadcast material,‖ at least as it applied to fleeting
expletives, in its March 2004 order in In re Complaints
Against Various Broadcast Licensees Regarding the Airing of
the “Golden Globe Awards” Program, 19 F.C.C.R. 4975
(2004) (―Golden Globes‖). See CBS Corp., 535 F.3d at 180.
Because that policy change post-dated the February 2004
broadcast at issue in this case, it cannot serve as the basis for
the penalty imposed on CBS. See id. at 180-81.
8
At the time the Halftime Show was broadcasted
by CBS, the FCC‘s policy on fleeting material
was still in effect. The FCC contends its
restrained policy applied only to fleeting
utterances — specifically, fleeting expletives —
and did not extend to fleeting images. But a
review of the Commission‘s enforcement
history reveals that its policy on fleeting
material was never so limited. The FCC‘s
present distinction between words and images
for purposes of determining indecency
represents a departure from its prior policy.
Id. at 174-75.
Reviewing in detail the progression of FCC rulings
leading up to the present, we could not find the distinction
advocated by the FCC. Indeed, we could only reach the
opposite conclusion:
[T]he balance of the evidence weighs heavily
against the FCC‘s contention that its restrained
enforcement policy for fleeting material
extended only to fleeting words and not to
fleeting images. As detailed, the Commission's
entire regulatory scheme treated broadcasted
images and words interchangeably for purposes
of determining indecency. Therefore, it follows
that the Commission‘s exception for fleeting
material under that regulatory scheme likewise
treated images and words alike. Three decades
of FCC action support this conclusion.
9
Accordingly, we find the FCC‘s conclusion on
this issue, even as an interpretation of its own
policies and precedent, ―counter to the evidence
before the agency‖ and ―so implausible that it
could not be ascribed to a difference in view or
the product of agency expertise.‖
Id. at 188 (quoting Motor Vehicle Mfrs. Ass‟n of U.S., Inc. v.
State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983)).
Thus, we found that the ruling in this case represented
a departure from prior policy that required an explanation:
The Commission‘s determination that CBS‘s
broadcast of a nine-sixteenths of one second
glimpse of a bare female breast was actionably
indecent evidenced the agency‘s departure from
its prior policy. Its orders constituted the
announcement of a policy change — that
fleeting images would no longer be excluded
from the scope of actionable indecency . . . .
[A]n agency cannot ignore a substantial
diversion from its prior policies. See
Ramaprakash v. FAA, 346 F.3d 1121, 1124
(D.C. Cir. 2003) (agency must ―provide a
reasoned analysis indicating that prior policies
and standards are being deliberately changed,
not casually ignored‖). As the Supreme Court
explained in State Farm, an agency must be
afforded great latitude to change its policies, but
it must justify its actions by articulating a
reasoned analysis behind the change . . . .
10
CBS Corp., 535 F.3d at 181-82 (citing State Farm, 463 U.S.
at 42-43).
We then noted that in Fox Television Stations, Inc. v.
F.C.C., the United States Court of Appeals for the Second
Circuit had analyzed under State Farm the FCC‘s change in
its fleeting-expletive policy (announced in its Golden Globes
order, after the 2004 Halftime Show broadcast at issue here)
and had ―rejected the agency‘s proffered rationale as
‗disconnected from the actual policy implemented by the
Commission.‘‖ Id. at 183 (quoting 489 F.3d 444, 459 n.8 (2d
Cir. 2007), rev‟d, Fox, 129 S. Ct. 1800). We then
distinguished the FCC‘s actions in Fox from its order in this
case:
There, as Judge Leval noted in dissent, the FCC
provided an explanation for changing its policy
on fleeting expletives. The critical question
splitting the court was whether that explanation
was adequate under State Farm. Here, unlike in
Fox, the FCC has not offered any
explanation — reasoned or otherwise — for
changing its policy on fleeting images. Rather,
the FCC asserts it never had a policy of
excluding fleeting images from the scope of
actionable indecency, and therefore no policy
change occurred when it determined that the
Halftime Show‘s fleeting image of Janet
Jackson's breast was actionably indecent.
Id. (emphasis added). Because our analysis of three decades
of FCC enforcement contradicted the Commission‘s assertion
in this regard, we concluded that ―the FCC‘s new policy of
11
including fleeting images within the scope of actionable
indecency is arbitrary and capricious under State Farm and
the Administrative Procedure Act, and therefore invalid as
applied to CBS.‖ Id. at 189.
We next engaged in a discussion regarding the degree
of scienter necessary for the imposition of a forfeiture, and
concluded the opinion by remanding to the agency, finding
this course of action to be appropriate where the agency has
issued an arbitrary decision. See id. at 209.
Eight months later the Supreme Court issued its
decision in Fox, on certiorari from the Second Circuit. See
Fox, 129 S.Ct. 1800. As noted above, the issue in that case
was ―the adequacy of the Federal Communications
Commission‘s explanation of its decision that [the statutory
prohibition on indecent language] sometimes forbids the
broadcasting of indecent expletives even when the offensive
words are not repeated,‖ not, as here, the question whether the
FCC‘s order amounted to a policy change.3 Id. at 1805(emphasis added).
3
In this regard, the Supreme Court noted that, in the orders
at issue in Fox:
The Commission forthrightly acknowledged
that its recent actions have broken new ground,
taking account of inconsistent ―prior
Commission and staff action‖ and explicitly
disavowing them as ―no longer good law.‖
Golden Globes, 19 F.C.C.R. at 4980 . . . . There
is no doubt that the Commission knew it was
making a change. That is why it declined to
12
The Court reviewed the statutory and regulatory
background in the introductory section of the opinion,
concluding with a discussion of the FCC‘s ruling in Golden
Globes, where ―the Commission took one step further by
declaring for the first time that a nonliteral (expletive) use of
the F- and S-Words could be actionably indecent, even when
the word is used only once,‖ Fox, 129 S. Ct. at 1807. The
Supreme Court observed:
The [Golden Globes] order acknowledged that
―prior Commission and staff action have
indicated that isolated or fleeting broadcasts of
the ‗F-Word‘ . . . are not indecent or would not
be acted upon.‖ It explicitly ruled that ―any
such interpretation is no longer good law.‖ It
―clarif[ied] . . . that the mere fact that specific
words or phrases are not sustained or repeated
does not mandate a finding that material that is
otherwise patently offensive to the broadcast
medium is not indecent.‖ Because, however,
―existing precedent would have permitted this
broadcast,‖ the Commission determined that
―NBC and its affiliates necessarily did not have
the requisite notice to justify a penalty.‖
Id. at 1808 (internal citations omitted).
assess penalties; and it relied on the Golden
Globes Order as removing any lingering doubt.
Remand Order, 21 F.C.C.R. at 13308.
Fox, 129 S. Ct. at 1812.
13
The Court next considered the case before it, which
involved two instances of celebrities‘ use of the ―F-Word‖ in
live broadcasts. Id. (discussing Cher‘s and Nicole Richie‘s
statements at two consecutive Billboard Music Awards
broadcasts). The Commission had initially issued Notices of
Apparent Liability, but imposed no fines. See In re
Complaints Regarding Various Television Broadcasts
Between February 2, 2002 and March 8, 2005, 21 F.C.C.R.
2664 (2006). In further proceedings, the Commission gave
Fox the opportunity to object, then upheld the indecency
findings. See In re Complaints Regarding Various Television
Broadcasts Between February 2, 2002, and March 8, 2005,
21 F.C.C.R. 13299 (2006) (―Remand Order‖). The FCC‘s
order explained its reason for departing from the position that
fleeting expletives were exempt from otherwise applicable
indecency standards:
In the Commission‘s view, ―granting an
automatic exemption for ‗isolated or fleeting‘
expletives unfairly forces viewers (including
children)‖ to take ―‗the first blow‘‖ and would
allow broadcasters ―to air expletives at all hours
of a day so long as they did so one at a time.‖
Fox, 129 S. Ct. at 1809 (internal citations omitted). The FCC
appeared to hedge to some degree as to the extent of, and
timing of, its change in policy for fleeting material, but, as the
Supreme Court noted, it ―made clear [that] the Golden Globes
Order eliminated any doubt that fleeting expletives could be
actionably indecent, and the Commission disavowed the
bureau-level decisions and its own dicta that had said
otherwise.‖ Id. (internal citations omitted).
14
Regarding the adequacy of the FCC‘s explanation for
its policy change, the Court rejected the Second Circuit‘s
view that an agency must ―make clear ‗why the original
reasons for adopting the [displaced] rule or policy are no
longer dispositive‘ as well as ‗why the new rule effectuates
the statute as well as or better than the old rule.‘‖ Fox, 129 S.
Ct. at 1810 (quoting Fox, 489 F.3d at 456-57) (internal
quotations omitted; alteration in original). It held:
To be sure, the requirement that an agency
provide reasoned explanation for its action
would ordinarily demand that it display
awareness that it is changing position. An
agency may not, for example, depart from a
prior policy sub silentio or simply disregard
rules that are still on the books. See United
States v. Nixon, 418 U.S. 683 (1974). And of
course the agency must show that there are
good reasons for the new policy. But it need
not demonstrate to a court's satisfaction that the
reasons for the new policy are better than the
reasons for the old one; it suffices that the new
policy is permissible under the statute, that there
are good reasons for it, and that the agency
believes it to be better, which the conscious
change of course adequately indicates.
Id. at 1811.
The Court concluded that, in that case, the
Commission‘s ―reasons for expanding the scope of its
enforcement activity were entirely rational‖:
15
It was certainly reasonable to determine that it
made no sense to distinguish between literal and
nonliteral uses of offensive words, requiring
repetitive use to render only the latter indecent.
As the Commission said with regard to
expletive use of the F-Word, ―the word‘s power
to insult and offend derives from its sexual
meaning.‖ And the Commission's decision to
look at the patent offensiveness of even isolated
uses of sexual and excretory words fits with the
context-based approach we sanctioned in
[F.C.C. v. Pacifica Foundation], 438 U.S.
[726], 750 [(1978)]. Even isolated utterances
can be made in ―pander[ing,] . . . vulgar and
shocking‖ manners, and can constitute harmful
―‗first blow[s]‘‖ to children. It is surely rational
(if not inescapable) to believe that a safe harbor
for single words would ―likely lead to more
widespread use of the offensive language.‖
Fox, 129 S. Ct. at 1812-13 (internal citations omitted).
Notably, the Court‘s discussion of the Commission‘s action
concluded with the following statement: ―[T]he agency‘s
decision not to impose any forfeiture or other sanction
precludes any argument that it is arbitrarily punishing parties
without notice of the potential consequences of their action.‖
Id. at 1813.
Accordingly, the Court reversed the Second Circuit‘s
order and upheld the FCC‘s decision.
16
II.
We must decide the extent to which Fox affects our
previous ruling in this case. We conclude that, if anything,
the Supreme Court‘s decision fortifies our original opinion, in
two ways.
For one thing, in Fox, unlike in this case, the FCC
acknowledged that its orders had ―broken new ground,‖ as
noted above. See 129 S. Ct. at 1812. The Supreme Court
specifically noted that the FCC‘s ―decision not to impose any
forfeiture or other sanction‖ in that case signaled its
recognition that assessing penalties based on violations of
previously unannounced policies would amount to ―arbitrarily
punishing parties without notice of the potential consequences
of their actions.‖ Id. at 1813. The same logic implies that the
FCC erred in imposing a fine on CBS in this case, as the
chronology of events that are the subject of these cases
demonstrates.
The FCC Enforcement Bureau‘s original, 2003 ruling
in Golden Globes applied its then-controlling policy of
exempting all fleeting indecent material from enforcement,
determining that the singer Bono‘s use of the ―F- Word‖
(―this is really, really f-- brilliant‖) did ―not fall within the
scope of the Commission‘s indecency prohibition.‖ CBS
Corp., 535 F.3d at 177 (quoting In re Complaints Against
Various Broadcast Licensees Regarding Their Airing of the
“Golden Globe Awards” Program, 18 F.C.C.R. 19859, ¶ 6
(FCC Enforcement Bureau 2003)). But, in March 2004, the
full Commission reversed the Enforcement Bureau‘s decision,
overruling all of its prior cases that held fleeting expletives
were not actionable. The Commission declined to impose a
17
penalty on the Golden Globes broadcasters, however, because
―‗existing precedent would have permitted [the Golden Globe
Awards] broadcast‘ and therefore it would be ‗inappropriate‘
to sanction licensees for conduct prior to notice of policy
change.‖ Id. at 178 (quoting Golden Globes, 19 F.C.C.R. at
4981-82).
The expletive utterances by Cher and Nicole Richie
that were considered in Fox took place, respectively, during
the 2002 and 2003 Billboard Music Awards telecasts, before
the full Commission‘s March 2004 Golden Globes decision.
Accordingly, and applying the same rationale as in Golden
Globes, the FCC declined to impose a fine. As the Fox Court
observed and affirmed, the decision not to impose a fine in
that case signaled the FCC‘s understanding that imposing
sanctions for conduct that occurred before the FCC‘s policy
change was announced would raise due process concerns.
See Fox, 129 S. Ct. at 1813.
The same principle applies here. The relevant
Halftime Show broadcast occurred in February 2004,
preceding the FCC‘s ruling in Golden Globes. But despite its
earlier consistent policy exempting all fleeting material —
words and images — from its indecency rules, see CBS
Corp., 535 F.3d at 188, the FCC assessed a fine against CBS.
Fox confirms our earlier observation that because the
Commission did not announce any change in its fleeting-
material policy until March 2004, and because the offensive
conduct in this case (like the offending conduct in Golden
Globes and Fox) preceded that date, the FCC‘s assessment of
a forfeiture and imposition of a penalty against CBS
constitutes arbitrary, and therefore unlawful, punishment.
18
Fox, 129 S. Ct. at 1813; see also CBS Corp., 535 F.3d at 180-
81.
The FCC and our dissenting colleague contend that, in
all events, the FCC‘s decision in Young Broadcasting of San
Francisco, Inc., 19 F.C.C.R. 1751 (2004), issued just days
before CBS‘s Halftime Show, provided CBS with adequate
notice that the FCC might impose a forfeiture for fleeting
nude images. But as we pointed out in our earlier opinion,
the 2004 Young Broadcasting decision was a non-final notice
of apparent liability; ―the final disposition of Young
Broadcasting was still unresolved‖ at the time of the Halftime
Show broadcast. Id. at 187 & n.18. The decision therefore
reflects only ―tentative conclusions‖ of the FCC, and, in our
view, provides insufficient notice of the FCC‘s official policy
on fleeting nude images, particularly when viewed in the
context of the agency‘s consistent refusal over three decades
to consider such fleeting material indecent, to justify the
imposition of sanctions against CBS.
Therefore, we must reaffirm our conclusion that the
penalty imposed in this case is arbitrary unless we find,
contrary to the extensive analysis in our earlier opinion, that
the FCC‘s pre-Golden Globes fleeting-material policy did not
also apply to fleeting images. But, here again, Fox supports
our previous conclusion. The Commission, and our
dissenting colleague, point to one small portion of the
background section in the Supreme Court‘s lengthy Fox
opinion as support for the position that the FCC‘s fleeting-
material policy never applied to images but was always
restricted to words. But we discern no such meaning in the
relevant passage, which briefly observed:
19
Although the Commission had expanded its
enforcement beyond the ―repetitive use of
specific words or phrases,‖ it preserved a
distinction between literal and nonliteral (or
―expletive‖) uses of evocative language. The
Commission explained that each literal
―description or depiction of sexual or excretory
functions must be examined in context to
determine whether it is patently offensive,‖ but
that ―deliberate and repetitive use . . . is a
requisite to a finding of indecency‖ when a
complaint focuses solely on the use of nonliteral
expletives.
129 S. Ct. at 1807 (quoting In re Pacifica Found., Inc., 2
F.C.C.R. 1191, 2699, ¶ 13 (1987)).
The FCC argues that images fall into the category of
literal ―descriptions or depictions‖ of sexual organs or
functions, and that the Court‘s language indicates that the
FCC‘s previous fleeting-material policy applied only to non-
literal, or expletive, depictions or descriptions, and not, as we
previously concluded, to fleeting images as well as
expletives. We disagree.
First, we do not see how this summary recitation of the
Commission‘s opinions affects the reasoning or result in our
case. It appears in the Court‘s background discussion of the
FCC‘s historical approach to indecent language, and is neither
reasoning nor holding; it is mere characterization. Second,
this language narrowly addresses words and phrases, with no
discussion of images. Although the phrase ―description or
depiction,‖ considered in isolation, could be construed to
20
include images, Justice Scalia is paraphrasing the language of
the FCC‘s 1987 Pacifica Foundation opinion, involving
words alone, in which the complete phrase used by the FCC
was ―speech involving the description or depiction of sexual
or excretory functions.‖4 In re Pacifica Found., Inc., 2
4
The full text of the relevant paragraph from Pacifica
Foundation is as follows:
While speech that is indecent
must involve more than an
isolated use of an offensive
word . . . , repetitive use of
specific words or phrases is not
an absolute requirement for a
finding of indecency. If a
complaint focuses solely on the
use of expletives, we believe that
under the legal standards set forth
in Pacifica, deliberate and
repetitive use in a patently
offensive manner is a requisite to
a finding of indecency. When a
complaint goes beyond the use of
expletives, however, repetition of
specific words or phrases is not
necessarily an element critical to a
determination of indecency.
Rather, speech involving the
description or depiction of sexual
or excretory functions must be
examined in context to determine
whether it is patently offensive
21
F.C.C.R. 2698, 2699 ¶ 13 (1987), quoted in Fox, 129 S. Ct. at
1807. As the dissent concedes, dissenting op. at 26-27 n.7,
Fox says nothing at all about images. Nor does it suggest that
the FCC‘s previous fleeting-material policy applied only to
―words,‖ or distinguished between words and images, as the
Commission originally argued to us (an argument we
forcefully rejected after reviewing three decades of rulings).
Indeed, the Fox Court had no occasion to consider the
application of the FCC‘s pre-Golden Globes fleeting-material
policy to images, since that case involved the use of spoken
fleeting expletives.5
under contemporary community
standards applicable to the
broadcast medium. The mere fact
that specific words or phrases are
not repeated does not mandate a
finding that material that is
otherwise patently offensive to the
broadcast medium is not indecent.
2 F.C.C.R. at 2699 ¶ 13 (emphases added).
5
Our dissenting colleague contends that the Supreme
Court‘s omission of any discussion of fleeting images in Fox
―strongly suggests‖ that images never fell within the FCC‘s
fleeting-material policy. Dissenting op. at 28. By contrast,
we are unwilling to read the Court‘s silence as overruling our
conclusion, based on a careful review of three decades of
FCC precedent to discern the agency‘s policy on precisely
this issue, that the FCC historically did not distinguish
between fleeting images and words. See 535 F.3d at 188(―[T]he Commission‘s entire regulatory scheme treated
22
More to the point, read in context, this language does
not refer to the FCC‘s pre-Golden Globes fleeting-material
policy at all. Instead, it describes the evolution of the
Commission‘s overall approach to a separate issue, i.e.,
whether ―its enforcement power was limited to ‗deliberate,
repetitive use of the seven words actually contained in the
George Carlin monologue.‘‖6 Id. at 1807 (quoting Pacifica
Found., 2 F.C.C.R. at 2699 ¶ 12). Critically, the relevant
portion of the Pacifica Foundation opinion that Fox quoted
clearly distinguished between these two concepts, explaining
that ―speech that is indecent must involve more than an
isolated,‖ i.e., fleeting, ―use of an offensive word,‖ but that
―repetitive use of specific words or phrases‖ (i.e., the
expletive words or phrases from the Carlin monologue) was
not required. Pacifica Found., 2 F.C.C.R. at 2699 ¶ 13
(emphasis added). The Supreme Court in the quoted
language from Fox, and the FCC in the Pacifica Foundation
opinion that Fox quoted, were focused entirely on the FCC‘s
earlier policy (arising out of the Carlin monologue) regarding
the ―‗use of specific words or phrases‘‖ as a prerequisite to a
finding of indecency, not the question whether the reference
to a particular word or image that might otherwise be deemed
indecent was passing or fleeting in nature. Just as Fox
involved spoken fleeting expletives, not fleeting images,
broadcasted images and words interchangeably for purposes
of determining indecency. Therefore, it follows that the
Commission‘s exception for fleeting material under that
regulatory scheme likewise treated words and images alike.‖).
Images simply were not involved in the case.
6
See Fox, 129 S. Ct. at 1806, and CBS Corp., 535 F.3d at
175, for additional background on the Carlin monologue.
23
Pacifica Foundation involved sustained, repeated use of
expletives and sexually explicit language, not fleeting words
or images.7
Moreover, the very next paragraph of Fox confirms
that neither the Supreme Court nor the FCC interpreted
Pacifica Foundation‘s distinction between literal and non-
literal uses of specific words or phrases to impact the
otherwise applicable policy for fleeting material. Fox, 129 S.
Ct. at 1807. In that paragraph, quoting an FCC policy
statement from 2001, the Court made clear that, even after
Pacifica Foundation, the exception for fleeting material still
applied, separate and apart from any distinction arising
between ―literal‖ and ―non-literal‖ words referring to sexual
or excretory functions. Quoting a 2001 FCC policy
statement, the Court said, ―‗No single factor,‘ the
Commission said, ‗generally provides the basis for an
indecency finding,‘ but ‗where sexual or excretory references
have been made once or have been passing or fleeting in
nature, this characteristic has tended to weigh against a
7
Pacifica Foundation concerned a radio station‘s airing of a
program entitled ―Shocktime America,‖ which allegedly
contained a narration and song lyrics using words and phrases
such as ―eat shit,‖ ―mother-fucker,‖ and ―fuck the U.S.A.,‖
and a program featuring excerpts from a play with dramatic
readings of sexual fantasies and containing language highly
descriptive of sexual and excretory activities. Pacifica
defended that the Shocktime remarks were not scripted, and
asserted that the language of the play was taken out of context
and the broadcast was at night when children would not be
listening.
24
finding of indecency.‘‖ Fox, 129 S. Ct. at 1807 (quoting In re
Industry Guidance on the Commission‟s Case Law
Interpreting 18 U.S.C. § 1464 and Enforcement Policies
Regarding Broadcast Indecency, 16 F.C.C.R. 7999, 8003
¶ 10, 8008 ¶ 17 (2001) (―Industry Guidance‖)) (emphasis
added).8
If we were to read the Supreme Court‘s background
discussion in Fox as indicating that the history of FCC
enforcement in the area of fleeting material recognized an
exception only for non-literal expletives, to the exclusion of
images, we would be accusing the Supreme Court of
rewriting history. This is because, in Young Broadcasting,
which involved a fleeting image of a body part much like the
one presented here, the Commission had the opportunity to
explain that, after Pacifica Foundation, its fleeting-material
policy did not apply to images. But the FCC did not say that,
nor did it mention, much less rely on, Pacifica Foundation in
analyzing the broadcast images at issue in that case.9 See
Young Broadcasting, 19 F.C.C.R. at 1755 ¶ 12 & n.35.
8
Interestingly, we cited this exact language as evidence of
the FCC‘s ―restrained enforcement policy‖ for fleeting
indecent material in our earlier opinion. See CBS Corp., 535
F.3d at 177.
9
Just as Young Broadcasting did not mention Pacifica
Foundation‘s literal / non-literal distinction, Fox does not
reference or attempt to reconcile Young Broadcasting,
confirming that the Court did not consider, much less decide,
whether the FCC‘s pre-Golden Globes fleeting-material
policy applied to images as well as words.
25
Instead, the FCC noted the fact that ―the actual
exposure of the performer‘s penis‖ in that case ―was fleeting
in that it occurred for less than a second.‖ Id. It then
compared the overall circumstances in the case to other cases
in which it had applied the fleeting-material exception, and
held that Young Broadcasting was different — an exception
to the exception — because ―the material was apparently
intended to pander to, titillate and shock viewers‖ and
because the station knew in advance that ―the interview
involved performers who appear nude in order to manipulate
and stretch their genitalia,‖ but ―failed to take adequate
precautions to ensure that no actionably indecent material was
broadcast.‖ Id. at 1755-56 ¶¶ 12-13 & n.35; see also CBS
Corp., 535 F.3d at 186 & n.16-17.
The Commission did not distinguish Young
Broadcasting because it involved images rather than words,
and its language demonstrates that it viewed the case as just
another ―instance‖ involving ―fleeting remarks in live,
unscripted broadcasts.‖ See Young Broadcasting, 19
F.C.C.R. at 1755 ¶ 12 (―We reject Young‘s assertion that this
material is equivalent to other instances in which the
Commission has ruled that fleeting remarks in live, unscripted
broadcasts do not meet the indecency definition.‖). As we
pointed out in our previous CBS opinion, had the FCC
believed that its fleeting-material policy categorically did not
apply to sexually explicit images, it most certainly would
have said so rather than relying on distinctions that could
apply to all fleeting material — remarks and images alike. Id.
at 187. The FCC has not persuaded us that the fleeting-
material exception was ever limited to words or expletives,
and it cannot do so when in Young Broadcasting it treated a
fleeting image just as it would have treated fleeting words.
26
Considering all of these facts, we do not see any basis
to conclude that Fox alters our previous analysis of the
fleeting-material exception. At bottom, the Commission
attempts to convert a passing reference in Fox‘s background
section into a holding that undermines what the opinion
otherwise makes clear: an agency may not apply a policy to
penalize conduct that occurred before the policy was
announced. The Commission‘s argument also rewrites
history, marginalizing the Supreme Court‘s recognition in
Fox that Golden Globes reflected a clear change in FCC‘s
fleeting-material policy, and ignoring the agency‘s consistent
practice — over three decades before its order in this case —
of exempting all fleeting material, whether words or images,
from enforcement under its indecency policy.10
10
Our prior opinion chronicled that history at length. As we
discussed:
The Commission‘s conclusion on the nature
and scope of its indecency regime-including its
fleeting material policy – is at odds with the
history of its actions in regulating indecent
broadcasts. In the nearly three decades between
the Supreme Court‘s ruling in Pacifica
Foundation and CBS‘s broadcast of the
Halftime Show, the FCC had never varied its
approach to indecency regulation based on the
format of broadcasted content. Instead, the
FCC consistently applied identical standards
and engaged in identical analyses when
reviewing complaints of potential indecency
27
Thus, we conclude that Fox does not alter our
reasoning or initial resolution of this case.
Part B: Opinion Regarding the Merits
In reasoning through Part A of this opinion, we
referred extensively to our prior opinion, which the Supreme
Court vacated before remanding the case to us in light of Fox.
While we ordinarily would simply reinstate our prior opinion
after determining that Fox did not undermine it, we cannot do
that here, for two reasons. First, the previous opinion was a
unanimous opinion authored by Judge Scirica, whereas the
opinion we now will issue is non-unanimous, with Judge
Scirica dissenting. Second, the new majority does not believe
that the earlier opinion‘s discussion of the scienter required
for a violation was necessary, and we decline to readopt that
portion of the analysis.
Accordingly, we do not reinstate our previous opinion.
Instead, we incorporate below those portions of the opinion
that we wish to readopt as part of our resolution of this case.11
whether the complaints were based on words or
images.
CBS Corp., 535 F.3d at 184.
11
We incorporate the pertinent portions of our previous
opinion as they were filed on July 21, 2008 and amended on
August 6, 2008. Thus, the citation information in Part B of
our opinion is current as of that date and does not reflect any
subsequent updates.
28
* * *
In this petition for review, CBS appeals orders of the
Federal Communications Commission imposing a monetary
forfeiture under 47 U.S.C. § 503(b) for the broadcast of
―indecent‖ material in violation of 18 U.S.C. § 1464 and 47
C.F.R. § 73.3999. The sanctions stem from CBS‘s live
broadcast of the Super Bowl XXXVIII Halftime Show, in
which two performers deviated from the show‘s script
resulting in the exposure of a bare female breast on camera, a
deceitful and manipulative act that lasted nine-sixteenths of
one second. CBS transmitted the image over public airwaves,
resulting in punitive action by the FCC.
CBS challenges the Commission‘s orders on
constitutional, statutory, and public policy grounds. Two of
the challenges are paramount: (1) whether the Commission
acted arbitrarily and capriciously under the Administrative
Procedure Act, 5 U.S.C. § 706, in determining that CBS‘s
broadcast of a fleeting image of nudity was actionably
indecent; and (2) whether the Commission, in applying three
theories of liability – traditional respondeat superior doctrine,
an alternative theory of vicarious liability based on CBS‘s
duties as a broadcast licensee, and the ―willfulness‖ standard
of the forfeiture statute – properly found CBS violated the
indecency provisions of 18 U.S.C. § 1464 and 47 C.F.R. §
73.3999. We will vacate the FCC‘s orders.
I.
On February 1, 2004, CBS presented a live broadcast
of the National Football League‘s Super Bowl XXXVIII,
which included a halftime show produced by MTV
29
Networks.12 Nearly 90 million viewers watched the Halftime
Show, which began at 8:30 p.m. Eastern Standard Time and
lasted about fifteen minutes. The Halftime Show featured a
variety of musical performances by contemporary recording
artists, with Janet Jackson as the announced headlining act
and Justin Timberlake as a ―surprise guest‖ for the final
minutes of the show.
Timberlake was unveiled on stage near the conclusion
of the Halftime Show. He and Jackson performed his popular
song ―Rock Your Body‖ as the show‘s finale. Their
performance, which the FCC contends involved sexually
suggestive choreography, portrayed Timberlake seeking to
dance with Jackson, and Jackson alternating between
accepting and rejecting his advances. The performance ended
with Timberlake singing, ―gonna have you naked by the end
of this song,‖ and simultaneously tearing away part of
Jackson‘s bustier. CBS had implemented a five-second audio
delay to guard against the possibility of indecent language
being transmitted on air, but it did not employ similar
precautionary technology for video images. As a result,
Jackson‘s bare right breast was exposed on camera for nine-
sixteenths of one second.
Jackson‘s exposed breast caused a sensation and
resulted in a large number of viewer complaints to the Federal
Communications Commission.13 In response, the
12
At that time, both CBS and MTV Networks were
divisions of Viacom, Inc.
13
The record is unclear on the actual number of complaints
received from unorganized, individual viewers. In its brief,
30
Commission‘s Enforcement Bureau issued a letter of inquiry
asking CBS to provide more information about the broadcast
along with a video copy of the entire Super Bowl program.
CBS supplied the requested materials, including a script of
the Halftime Show, and issued a public statement of apology
for the incident. CBS stated Jackson and Timberlake‘s
wardrobe stunt was unscripted and unauthorized, claiming it
had no advance notice of any plan by the performers to
deviate from the script.
On September 22, 2004, the Commission issued a
Notice of Apparent Liability finding CBS had apparently
violated federal law and FCC rules restricting the broadcast of
indecent material. After its review, the Commission
determined CBS was apparently liable for a forfeiture penalty
of $550,000.14 CBS submitted its Opposition to the Notice of
Apparent Liability on November 5, 2004.
the FCC asserts it received ―‗an unprecedented number‘ of
complaints about the nudity broadcast during the halftime
show.‖ FCC Br. at 12 (citation omitted). CBS disputes the
calculation and significance of the viewer complaints. See
CBS Reply Br. at 15 n.6 (―Of the ‗over 542,000 complaints
concerning the broadcast‘ the FCC claims to have received,
over 85 percent are form complaints generated by single-
interest groups. Approximately twenty percent of the
complaints are duplicates, with some individual complaints
appearing in the record up to 37 times.‖ (citations omitted)).
14
This figure represented the aggregate of proposed
penalties against individual CBS stations. At the time the
Commission issued its Notice of Apparent Liability,
31
The Commission issued a forfeiture order over CBS‘s
opposition on March 15, 2006, imposing a forfeiture penalty
of $550,000. In re Complaints Against Various Television
Licensees Concerning Their February 1, 2004 Broadcast of
the Super Bowl XXXVIII Halftime Show, 21 F.C.C.R. 2760
(2006) (―Forfeiture Order‖). Affirming its preliminary
findings, the Commission concluded the Halftime Show
broadcast was indecent because it depicted a sexual organ and
violated ―contemporary community standards for the
broadcast medium.‖ Id. at ¶ 10. In making this
determination, the FCC relied on a contextual analysis to find
the broadcast of Jackson‘s exposed breast was: (1) graphic
and explicit, (2) shocking and pandering, and (3) fleeting. Id.
at ¶ 14. It further concluded that the brevity of the image was
outweighed by the other two factors. Id. The standard
applied by the Commission is derived from its 2001 policy
statement setting forth a two-part test for indecency: (1) ―the
material must describe or depict sexual or excretory organs or
activities,‖ and (2) it must be ―patently offensive as measured
by contemporary community standards for the broadcast
medium.‖ In re Industry Guidance on the Commission‟s
Case Law Interpreting 18 U.S.C. § 1464 and Enforcement
Policies Regarding Broadcast Indecency, 16 F.C.C.R. 7999,
8002 ¶¶ 7-8 (2001) (emphasis in original). The Commission
had informed broadcasters in its 2001 policy statement that in
performing the second step of the test – measuring the
offensiveness of any particular broadcast – it would look to
three factors: ―(1) the explicitness or graphic nature of the
forfeiture penalties for indecency violations were statutorily
capped at $27,500. The Commission proposed the maximum
penalty for each CBS station.
32
description or depiction of sexual or excretory organs or
activities; (2) whether the material dwells on or repeats at
length descriptions of sexual or excretory organs or activities;
(3) whether the material appears to pander or is used to
titillate, or whether the material appears to have been
presented for its shock value.‖ Id. at ¶ 10 (emphasis omitted).
Additionally, the FCC determined CBS‘s actions in
broadcasting the indecent image were ―willful‖ and therefore
sanctionable by a monetary forfeiture under 47 U.S.C. §
503(b)(1). See id. at ¶ 15. Adopting the definition of
―willful‖ found in section 312(f)(1) of the Communications
Act,15 the Commission offered three explanations for its
determination of willfulness. Id. First, the FCC found CBS
―acted willfully because it consciously and deliberately
broadcast the halftime show, whether or not it intended to
broadcast nudity . . . .‖ Id. Second, the FCC found CBS
acted willfully because it ―consciously and deliberately failed
to take reasonable precautions to ensure that no actionably
indecent material was broadcast.‖ Id. Finally, the FCC
applied a respondeat superior theory in finding CBS
vicariously liable for the willful actions of its agents, Jackson
and Timberlake. Id.15
This section of the Communications Act provides: ―The
term ‗willful‘, when used with reference to the commission or
omission of any act, means the conscious and deliberate
commission or omission of such act, irrespective of any intent
to violate any provision of this Act or any rule or regulation
of the Commission authorized by this Act or by a treaty
ratified by the United States.‖ 47 U.S.C. § 312(f)(1).
33
On April 14, 2006, CBS submitted a Petition for
Reconsideration under 47 C.F.R. § 1.106, raising several
arguments against the Commission‘s findings and
conclusions. In its Order on Reconsideration, the FCC
rejected CBS‘s statutory and constitutional challenges and
reaffirmed its imposition of a $550,000 forfeiture. In re
Complaints Against Various Television Licensees Concerning
Their February 1, 2004 Broadcast of the Super Bowl XXXVIII
Halftime Show, 21 F.C.C.R. 6653 (2006) (―Reconsideration
Order‖). The Reconsideration Order revised the
Commission‘s approach for determining CBS‘s liability
under the willfulness standard. The Commission reiterated its
application of vicarious liability in the form of respondeat
superior and its determination that CBS was directly liable
for failing to take adequate measures to prevent the broadcast
of indecent material. See id. at ¶ 16. But it abandoned its
position that CBS acted willfully under 47 U.S.C. § 503(b)(1)
by intentionally broadcasting the Halftime Show irrespective
of its intent to broadcast the particular content included in the
show. Instead, it determined CBS could be liable ―given the
nondelegable nature of broadcast licensees‘ responsibility for
their programming.‖ Id. at ¶ 23. The Commission has since
elaborated on this aspect of the Reconsideration Order,
explaining it as a separate theory of liability whereby CBS
can be held vicariously liable even for the acts of its
independent contractors because it holds non-delegable duties
as a broadcast licensee to operate in the public interest and to
avoid broadcasting indecent material. See, e.g., FCC Br. at
44-45.
CBS timely filed a petition for review of the
Reconsideration Order on July 28, 2006. It challenges the
34
FCC‘s orders on several grounds, and both parties are
supported by briefing from several amici.
II.
Our standard of review of agency decisions is
governed by the Administrative Procedure Act, 5 U.S.C. §
706. Under the Administrative Procedure Act, we ―hold
unlawful and set aside agency action, findings, and
conclusions‖ that are found to be ―arbitrary, capricious, an
abuse of discretion, or otherwise not in accordance with the
law.‖ Id. § 706(2)(A); see, e.g., Motor Vehicle Mfrs. Ass‟n v.
State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 41 (1983).
The scope of review under the ―arbitrary and
capricious‖ standard is ―narrow, and a court is not to
substitute its judgment for that of the agency.‖ State Farm,
463 U.S. at 43. Nevertheless, the agency must reach its
decision by ―examin[ing] the relevant data,‖ and it must
―articulate a satisfactory explanation for its action including a
‗rational connection between the facts found and the choice
made.‘‖ Id. (quoting Burlington Truck Lines, Inc. v. United
States, 371 U.S. 156, 168 (1962)). We generally find agency
action arbitrary and capricious where:
the agency has relied on factors which Congress
has not intended it to consider, entirely failed to
consider an important aspect of the problem,
offered an explanation for its decision that runs
counter to the evidence before the agency, or is
so implausible that it could not be ascribed to a
difference in view or the product of agency
expertise. The reviewing court should not
35
attempt itself to make up for such deficiencies;
we may not supply a reasoned basis for the
agency‘s action that the agency itself has not
given.
Id. at 43 (citing SEC v. Chenery Corp., 332 U.S. 194, 196
(1947)).
Our review of the constitutional questions is more
searching. In cases raising First Amendment issues, we have
―an obligation ‗to make an independent examination of the
whole record‘ in order to make sure that ‗the judgment does
not constitute a forbidden intrusion on the field of free
expression.‘‖ United States v. Various Articles of Merch.,
Schedule No. 287, 230 F.3d 649, 652 (3d Cir. 2000) (quoting
Bose Corp. v. Consumers Union, 466 U.S. 485, 499 (1984)
(citations omitted)).
III.
The FCC possesses authority to regulate indecent
broadcast content, but it had long practiced restraint in
exercising this authority. During a span of nearly three
decades, the Commission frequently declined to find
broadcast programming indecent, its restraint punctuated only
by a few occasions where programming contained indecent
material so pervasive as to amount to ―shock treatment‖ for
the audience. Throughout this period, the Commission
consistently explained that isolated or fleeting material did
not fall within the scope of actionable indecency.
At the time the Halftime Show was broadcasted by
CBS, the FCC‘s policy on fleeting material was still in effect.
36
The FCC contends its restrained policy applied only to
fleeting utterances – specifically, fleeting expletives – and did
not extend to fleeting images. But a review of the
Commission‘s enforcement history reveals that its policy on
fleeting material was never so limited. The FCC‘s present
distinction between words and images for purposes of
determining indecency represents a departure from its prior
policy.
Like any agency, the FCC may change its policies
without judicial second-guessing. But it cannot change a
well-established course of action without supplying notice of
and a reasoned explanation for its policy departure. Because
the FCC failed to satisfy this requirement, we find its new
policy arbitrary and capricious under the Administrative
Procedure Act as applied to CBS.
A.
Section 326 of the Communications Act prohibits the
FCC from censoring its licensees‘ broadcasts.16 Subject to
this constraint, the FCC retains authority to regulate obscene,
indecent, or profane broadcast content. See 18 U.S.C. § 1464(―Whoever utters any obscene, indecent, or profane language
16
See 47 U.S.C. § 326 (―Nothing in this chapter shall be
understood or construed to give the Commission the power of
censorship over the radio communications or signals
transmitted by any radio station, and no regulation or
condition shall be promulgated or fixed by the Commission
which shall interfere with the right of free speech by means of
radio communication.‖).
37
by means of radio communication shall be fined under this
title or imprisoned not more than two years, or both.‖).
Indecency and obscenity are distinct categories of speech.
See FCC v. Pacifica Found., 438 U.S. 726, 739-41 (1978)
(plurality opinion) (―Pacifica‖). Indecency, unlike obscenity,
is protected by the First Amendment. Sable Commc‟ns of
Cal., Inc. v. FCC, 492 U.S. 115, 126 (1989). The FCC‘s
authority to restrict indecent broadcast content is nevertheless
constitutionally permissible because of the unique nature of
the broadcast medium. Pacifica, 438 U.S. at 750-51; see also
id. at 755-56 (Powell, J., concurring).
Congress authorized the FCC to impose forfeiture
penalties for violations of 18 U.S.C. § 1464 in 1960. 17 But
the FCC did not exercise its authority to find a broadcast
statutorily ―indecent‖ until 1975, when it issued a forfeiture
penalty against Pacifica Foundation for broadcasting
comedian George Carlin‘s ―Filthy Words‖ monologue. See
In re Citizen‟s Complaint Against Pacifica Found., Station
WBAI(FM), N.Y., N.Y., 56 F.C.C.2d 94 (1975). Carlin‘s
monologue, which Pacifica aired on the radio in an early-
afternoon time slot, contained extensive and repetitive use of
several vulgar expletives over a period of twelve minutes.
See Pacifica, 438 U.S. at 739.
Pacifica appealed the FCC‘s forfeiture order to the
United States Court of Appeals for the D.C. Circuit. The
17
See 47 U.S.C. § 503(b)(1)(D) (―Any person who is
determined by the Commission . . . to have . . . violated any
provision of section . . . 1464 of title 18 . . . shall be liable to
the United States for a forfeiture penalty.‖).
38
FCC issued a clarification order while Pacifica‘s appeal was
pending, expressly limiting its prior forfeiture order to the
specific facts of the Carlin monologue. In re „A Petition for
Clarification or Reconsideration‟ of a Citizen‟s Complaint
Against Pacifica Found., Station WBAI(FM), N.Y., N.Y., 59
F.C.C.2d 892 (1976) (―Pacifica Clarification Order‖).
Expressly acknowledging the forfeiture order‘s potential
negative impact on broadcast coverage of live events where
―there is no opportunity for journalistic editing,‖ the FCC
stated its intention to exclude such circumstances from the
scope of actionable indecency. Id. at ¶ 4 n.1.
Following the Pacifica Clarification Order, the D.C.
Circuit reversed the FCC‘s forfeiture order against Pacifica as
vague and overbroad and found the agency‘s indecency
regime constituted invalid censorship under 47 U.S.C. § 326.
Pacifica Found. v. FCC, 556 F.2d 9, 14 (D.C. Cir. 1977).
The FCC appealed and the Supreme Court reversed in a
narrow plurality opinion. See Pacifica, 438 U.S. at 726. The
Court rejected Pacifica‘s statutory argument that the term
―indecent‖ in 18 U.S.C. § 1464 only covered obscene speech.
Pacifica, 438 U.S. at 739. But the Court confirmed the
general validity of the FCC‘s indecency regime,
―emphasiz[ing] the narrowness of [its] holding,‖ which it
confined to the facts of the Carlin monologue. Id. at 750.
Justices Powell and Blackmun concurred in the judgment,
writing separately in part to reiterate the narrowness of the
decision and to note the Court‘s holding did not ―speak to
cases involving the isolated use of a potentially offensive
word in the course of a radio broadcast, as distinguished from
the verbal shock treatment administered by respondent here.‖
Id. at 760-61 (Powell, J., concurring).
39
Shortly after the Court‘s ruling in Pacifica, a
broadcaster‘s license renewal was challenged on the basis that
the broadcaster had aired indecent programming. See In re
Application of WGBH Educ. Found., 69 F.C.C.2d 1250(1978) (―WGBH‖). Viewer complaints alleged the
broadcaster aired several programs containing nudity and
other allegedly offensive material. Id. at ¶ 2. Distinguishing
the facts of WGBH from the Court‘s ruling in Pacifica, the
FCC rejected the challenge and denied that Pacifica afforded
it any ―general prerogative to intervene in any case where
words similar or identical to those in Pacifica are broadcast
over a licensed radio or television station.‖ Id. at ¶ 10. The
FCC, noting it ―intend[ed] strictly to observe the narrowness
of the Pacifica holding‖ and emphasizing the language in
Justice Powell‘s concurring opinion, id. at ¶ 10, concluded the
single use of an expletive in a program ―should not call for us
to act under the holding of Pacifica.‖ Id. at ¶ 10 n.6.
The FCC‘s restrained enforcement policy continued in
the years following Pacifica. Rejecting another challenge to
a broadcaster‘s license renewal based on the airing of
allegedly indecent material, the FCC reaffirmed that isolated
use of expletives in broadcasts did not constitute actionable
indecency under 18 U.S.C. § 1464. See In re Application of
Pacifica Found., 95 F.C.C.2d 750 (1983). The complaint
alleged the broadcaster had on multiple occasions aired
programming containing language such as ―motherfucker,‖
―fuck,‖ and ―shit.‖ Id. at ¶ 16. The FCC held these facts did
not constitute a prima facie showing of actionable indecency
under 18 U.S.C. § 1464, because the complainant had failed
to show the broadcasts amounted to ―verbal shock treatment‖
as opposed to ―isolated use.‖ Id. at ¶ 18.
40
In April 1987, the FCC issued three simultaneous
indecency decisions. See In re Pacifica Found., Inc., 2
F.C.C.R. 2698 (1987); In re Regents of the Univ. of Cal., 2
F.C.C.R. 2703 (1987); In re Infinity Broad. Corp., 2 F.C.C.R.
2705 (1987). These decisions reaffirmed the Commission‘s
restrained enforcement policy and reiterated the agency‘s
policy that isolated or fleeting material would not be
considered actionably indecent. See, e.g., Regents of the
Univ. of Cal. at ¶ 3 (―Speech that is indecent must involve
more than an isolated use of an offensive word.‖).
Later in 1987, reconsidering these decisions, the
Commission abandoned the view that only the particular
―dirty words‖ used in the Carlin monologue could be
indecent.18 Instead, the FCC explained it would thereafter
rely on the broader terms of its generic indecency standard,
which defined indecent material as ―language that describes,
in terms patently offensive as measured by contemporary
community standards for the broadcast medium, sexual or
excretory activities or organs, when there is a reasonable risk
18
See In re Infinity Broad. Corp., 3 F.C.C.R. 930, ¶ 5
(1987), vacated in part on other grounds, Action for
Children‟s Television v. FCC, 852 F.2d 1332, 1337 (D.C. Cir.
1988) (―ACT I‖), superseded by Action for Children‟s
Television v. FCC, 58 F.3d 654 (D.C. Cir. 1995) (en banc)
(―ACT II‖).
41
that children may be in the audience.‖ Id. at ¶¶ 2, 5.19 Even
so, the FCC affirmed all three decisions on reconsideration,
never indicating disagreement with those decisions‘ express
statements that isolated or fleeting material could not be
actionably indecent. Id.
In 2001, the broadcast industry sought clarification of
the policies and rules of the FCC‘s indecency enforcement
regime. Guidance for the industry came in the form of a
policy statement issued by the Commission. See Industry
Guidance on the Commission‟s Case Law Interpreting 18
U.S.C. § 1464 and Enforcement Policies Regarding
Broadcast Indecency, 16 F.C.C.R. 7999, ¶ 19 (2001)
(―Industry Guidance‖). The policy statement included
multiple examples of FCC rulings as ―case comparisons‖
19
As described in greater detail infra, subsequent litigation
determined what time of day broadcasters could reasonably
air indecent programming without expecting children to be in
the audience. The D.C. Circuit Court of Appeals rejected a
total ban on indecency, instructing the FCC to identify a
precise time period during which broadcasters could air
indecent material. See ACT I, supra. In response, the
Commission adopted the safe-harbor rule of 47 C.F.R. §
73.3999. After further instruction from the D.C. Circuit in
1995, ACT II, supra, the Rule was amended to its current
form, which confines enforcement of indecency restrictions to
the hours ―between 6:00 a.m. and 10:00 p.m.‖ See 47 C.F.R.
§ 73.3999; In re Enforcement of Prohibitions Against
Broadcast Indecency in 18 U.S.C. § 1464, 10 F.C.C.R. 10558
(1995).
42
highlighting the factors that had proved significant in prior
indecency determinations. One of the factors noted as
leading to prior determinations that a program was not
actionably indecent was the ―fleeting or isolated‖ nature of
potentially indecent material in the context of the overall
broadcast. See id. at ¶¶ 17-18.
Soon after the Commission‘s issuance of the Industry
Guidance policy statement, its restrained enforcement policy
changed. In an unscripted remark during a live NBC
broadcast of the Golden Globe Awards on January 19, 2003,
musician Bono said ―this is really, really fucking brilliant‖
while accepting an award. See In re Complaints Against
Various Broadcast Licensees Regarding Their Airing of the
“Golden Globe Awards” Program, 19 F.C.C.R. 4975, ¶ 3 n.4
(2004) (―Golden Globes‖). Viewers complained to the FCC
about Bono‘s speech, but the Commission‘s Enforcement
Bureau rejected the complaints in part because the utterance
was fleeting and isolated and therefore did ―not fall within the
scope of the Commission‘s indecency prohibition.‖ See In re
Complaints Against Various Broadcast Licensees Regarding
Their Airing of the “Golden Globe Awards” Program, 18
F.C.C.R. 19859, ¶ 6 (FCC Enforcement Bureau 2003). The
Enforcement Bureau specifically reaffirmed that ―fleeting and
isolated remarks of this nature do not warrant Commission
action.‖ Id.On March 3, 2004, the full Commission reversed the
Enforcement Bureau‘s decision. See generally Golden
Globes, supra. Although the FCC acknowledged the
existence of its restrained enforcement policy for isolated or
fleeting utterances, it overruled all of its prior cases holding
such instances not actionable. Id. at ¶ 12 (―While prior
43
Commission and staff action have indicated that isolated or
fleeting broadcasts of the ‗F-Word‘ such as that here are not
indecent or would not be acted upon, consistent with our
decision today we conclude that any such interpretation is no
longer good law.‖). But the Commission made it clear that
licensees could not be held liable for broadcasting fleeting or
isolated indecent material prior to its Golden Globes decision.
See id. at ¶ 15 & n.40 (declining to impose a forfeiture
penalty because ―existing precedent would have permitted
[the Golden Globe Awards] broadcast‖ and therefore it would
be ―inappropriate‖ to sanction licensees for conduct prior to
notice of policy change).20
The FCC‘s new indecency policy created in Golden
Globes was soon challenged by the broadcast industry. On
February 21, 2006, the Commission issued an omnibus order
resolving multiple indecency complaints against television
broadcasters in an effort to ―provide substantial guidance to
broadcasters and the public about the types of programming
that are impermissible under our indecency standard.‖ In re
Complaints Regarding Various Television Broadcats Between
February 2, 2002 and March 8, 2005, 21 F.C.C.R. 2664, ¶ 2
(2006) (―Omnibus Order‖). The Omnibus Order found four
20
The Commission also cited Trinity Broad. of Fla., Inc. v.
FCC, 211 F.3d 618 (D.C. Cir. 2000), explaining that the court
in Trinity ―reversed [a] Commission decision that denied a
renewal application for abuse of process in connection with
the Commission‘s minority ownership rules because the court
found the Commission had not provided sufficiently clear
notice of what those rules required.‖ Golden Globes at ¶ 15
n.40.
44
programs indecent and profane: (1) Fox‘s broadcast of the
2002 Billboard Music Awards, in which performer Cher used
an unscripted expletive during her acceptance speech; (2)
Fox‘s broadcast of the 2003 Billboard Music Awards, in
which presenter Nicole Richie used two unscripted
expletives; (3) ABC‘s broadcast of various episodes of its
NYPD Blue series, in which assorted characters used scripted
expletives; and (4) a CBS broadcast of The Early Show, in
which a guest used an unscripted expletive during a live
interview. Id. at ¶¶ 101, 112 n.64, 125, 137. Applying its
policy announced in Golden Globes, the Commission found
the broadcasts indecent despite the fleeting and isolated
nature of the offending expletives. Id. at ¶¶ 104, 116, 129,
140.
As in Golden Globes, the Commission recognized the
inequity in retroactively sanctioning the conduct of broadcast
licensees. Because the offending broadcasts occurred prior to
the issuance of its Golden Globes decision, the FCC
concluded that existing precedent would have permitted the
broadcasts. Id. Accordingly, the FCC did not issue forfeiture
orders against any of the licensees. Id. at ¶¶ 111, 124, 136,
145.
The networks appealed the Omnibus Order, and the
cases were consolidated before the United States Court of
Appeals for the Second Circuit. Granting a request by the
FCC, the court remanded the matter to allow the Commission
an opportunity to address the petitioners‘ arguments. After
soliciting public comment, the FCC issued a new order on
November 6, 2006, reaffirming its indecency findings against
Fox for the 2002 and 2003 Billboard Music Awards but
reversing its finding against CBS for The Early Show
45
broadcast and dismissing the complaint against ABC on
procedural grounds. See In re Complaints Regarding Various
Television Broadcasts Between February 2, 2002 and March
8, 2005, 21 F.C.C.R. 13299 (2006) (―Fox Remand Order‖).
The networks‘ original appeal to the Second Circuit
was reinstated on November 8, 2006, and consolidated with a
petition for review of the Fox Remand Order. Fox Television
Stations, Inc. v. FCC, 489 F.3d 444, 454 (2d Cir. 2007)
(―Fox‖), cert. granted, 76 U.S.L.W. 3490 (U.S. Mar. 17,
2008) (No. 07-582). The court granted motions to intervene
by other networks, including CBS, and the networks
collectively raised several challenges to the validity of the
Fox Remand Order essentially mirroring those raised in this
case. See Fox, 489 F.3d at 454.
Undertaking a thorough review of the history of the
FCC‘s indecency regime similar to that which we engage in
here, the Second Circuit found the FCC‘s ―consistent
enforcement policy‖ prior to the Golden Globes decision
excluded fleeting or isolated expletives from regulation. Id.
at 455. The court concluded ―there is no question‖ that the
FCC changed its policy with respect to fleeting expletives,
and that the policy ―changed with the issuance of Golden
Globes.‖ Id. (citations omitted). Judge Leval, dissenting in
Fox for other reasons, agreed with the majority‘s conclusion
that the FCC changed its position on fleeting utterances,
although he considered the change of standard ―relatively
modest.‖ See id. at 469 (Leval, J., dissenting); see also id. at
470 (Leval, J., dissenting) (stating that the FCC changed its
position and finding that the FCC clearly acknowledges that
its Golden Globes and Fox Remand Order rulings were not
consistent with its prior standard). We agree that the Golden
46
Globes decision represented a policy departure by the FCC.
The extensive history detailed above demonstrates a
consistent and entrenched policy of excluding fleeting
broadcast material from the scope of actionable indecency.
In spite of this history, the FCC contends that by
February 1, 2004 (the date of the Halftime Show), a
broadcaster in CBS‘s position should have known that even
isolated or fleeting indecent material in programming could
be actionable. Despite its announced reversal of prior policy
in its Golden Globes decision on March 3, 2004, the
Commission points to one sentence in its 2001 policy
statement to support its position: ―[E]ven relatively fleeting
references may be found indecent where other factors
contribute to a finding of patent offensiveness.‖ Industry
Guidance at ¶ 19.21 But when read in its original context
21
In its 2001 policy statement, the Commission described
the ―principal factors that have proved significant in [its]
decisions to date‖ as: ―(1) the explicitness or graphic nature
of the description or depiction of sexual or excretory organs
or activities; (2) whether the material dwells on or repeats at
length descriptions of sexual or excretory organs or activities;
(3) whether the material appears to pander or is used to
titillate, or whether the material appears to have been
presented for its shock value.‖ Industry Guidance at ¶ 10
(emphasis in original). It has since contended that its fleeting
material policy was no policy at all, asserting instead that the
fleeting nature of material was only a consideration under the
second factor and could be outweighed by the other two
factors depending on the specific facts of a case. But as we
detail infra, this assertion contradicts the history of the
47
rather than as an isolated statement, this sentence does not
support the Commission‘s assertion here. The ―relatively
fleeting references‖ identified by that sentence are
distinguishable from the truly ―fleeting‖ broadcast material
the FCC had included in its fleeting material policy. The
paragraph cites, for instance, a notice of apparent liability
against WEZB-FM, New Orleans, to exemplify the kind of
―relatively fleeting references‖ the FCC considered
actionably indecent. See id. (citing EZ New Orleans, Inc.
(WEZB(FM)), 12 F.C.C.R. 4147 (MMB 1997) (―WEZB-FM
NAL‖)). The citation to WEZB-FM NAL specifically
describes as indecent an ―announcer joke‖ involving incest,
forceful sexual contact with children, and a reference to
cleaning ―blood off [a] diaper.‖ Id. The ―announcer joke‖ is
distinguishable on its face from ―fleeting‖ material such as a
brief glimpse of nudity or isolated use of an expletive.
Moreover, the ―announcer joke‖ was merely one incident
Commission‘s indecency enforcement regime and is
foreclosed by the agency‘s admissions in Golden Globes and
Fox, which are controlling here, that its prior policy was to
exclude fleeting material from the scope of actionable
indecency. Although the FCC disputes the breadth of its
policy, now contending the policy was limited only to fleeting
expletives or alternatively to fleeting utterances, the fleeting
nature of broadcast material was unquestionably treated by
the FCC as more than one of several contextual factors
subject to balancing.
48
among dozens included in a transcript supporting the
forfeiture liability determination in the WEZB-FM NAL.22
Nevertheless, as it clarified at oral argument, the FCC
relies on its 2001 Industry Guidance to contend its policy on
fleeting or isolated material ―was a policy with respect to
cases relying solely on the use of expletives.‖ As the
Commission explained at oral argument, ―[t]here was not a
policy that all short utterances were exempt.‖ This reading of
the Commission‘s policy on fleeting material is untenable.
Even the FCC‘s Industry Guidance fails to support such a
narrow characterization. See, e.g., Industry Guidance at ¶ 18
(quoting L.M. Commc‟ns of S. C., Inc. (WYBB(FM)), 7
F.C.C.R. 1595 (MMB 1992), for the proposition that ―‗a
fleeting or isolated utterance . . . , within the context of live
and spontaneous programming, does not warrant a
Commission sanction.‘‖).
Accordingly, we find the Commission‘s
unsubstantiated contentions in this regard contradict the
22
The WEZB-FM NAL found a broadcast licensee
apparently liable for a forfeiture penalty of $12,000 for its
broadcast of indecent material during six radio broadcasts
spanning fourteen hours of airtime over nearly a one year
period. The WEZB-FM NAL provides transcript excerpts
from these broadcasts, which involved very graphic segments
discussing a variety of sexual topics in extended detail. The
―announcer joke‖ included in the FCC‘s Industry Guidance
was merely one of these factual predicates for the broadcast
licensee‘s forfeiture liability for indecency.
49
lengthy history of the Commission‘s restrained enforcement
policy. While ―an agency‘s interpretation of its own
precedent is entitled to deference,‖ Cassel v. FCC, 154 F.3d
478, 483 (D.C. Cir. 1998), deference is inappropriate where
the agency‘s proffered interpretation is capricious. Until its
Golden Globes decision in March of 2004, the FCC‘s policy
was to exempt fleeting or isolated material from the scope of
actionable indecency. Because CBS broadcasted the
Halftime Show prior to Golden Globes, this was the policy in
effect when the incident with Jackson and Timberlake
occurred.
B.
If the FCC‘s restrained enforcement policy for fleeting
broadcast material was intact until the Golden Globes
decision in March of 2004, our inquiry would end with a
simple examination of the chronology of the FCC‘s actions.
CBS broadcasted the Halftime Show more than a month prior
to Golden Globes. The Commission‘s orders here would
amount to a retroactive application of the new policy it
announced in Golden Globes, which would raise due process
concerns. The Commission has recognized the inequity in
such an outcome. See Omnibus Order, supra, at ¶¶ 111, 124,
136, 145 (declining to issue forfeiture orders because the
offending broadcasts occurred prior to the issuance of its
Golden Globes decision, and therefore ―existing precedent
would have permitted [the] broadcasts‖); see also Trinity
Broad. of Fla., Inc., 211 F.3d at 628 (―Because ‗[d]ue process
requires that parties receive fair notice before being deprived
of property,‘ we have repeatedly held that ‗[i]n the absence of
notice–for example, where the regulation is not sufficiently
clear to warn a party about what is expected of it–an agency
50
may not deprive a party of property by imposing civil or
criminal liability.‘‖ (citation omitted)).
But the FCC urges another reading of Golden Globes,
perhaps less obvious yet still plausible, which interprets
Golden Globes as addressing only the broadcast of fleeting
expletives, not other fleeting material such as brief images of
nudity. Further, the Commission contends its fleeting
material policy, as initially adopted, was limited to fleeting
words and did not extend to fleeting images. Under this view,
Golden Globes would be inapposite here – the Commission‘s
sanction against CBS would be in line with its treatment of
images as part of its historical indecency enforcement regime.
If, as the FCC contends, Golden Globes was limited to
fleeting expletives, then its orders issuing forfeiture penalties
in this case did not constitute a retroactive application of the
policy change in Golden Globes.
But even if we accept the FCC‘s interpretation of
Golden Globes and read it as only addressing fleeting
expletives, the Commission‘s view of the scope of its fleeting
materials policy prior to Golden Globes is unsustainable. As
we will explain, the Commission – before Golden Globes –
had not distinguished between categories of broadcast
material such as images and words. Accordingly, even if, as
the FCC contends, Golden Globes only addressed expletives,
it nevertheless represented the first time the Commission
distinguished between formats of broadcast material or
singled out any one category of material for special treatment
under its fleeting material policy. That is, it altered the scope
of the FCC‘s fleeting material policy by excising only one
category of fleeting material – fleeting expletives – from the
policy. And it therefore did not constitute an abdication of its
51
fleeting material policy. Rather, a residual policy on other
categories of fleeting material – including all broadcast
content other than expletives – remained in effect.
Accordingly, subsequent agency action was required to
change the fleeting material policy as it applied to broadcast
content other than expletives. By targeting another category
of fleeting material – fleeting images – in its orders against
CBS in this case, the FCC apparently sought to further narrow
or eliminate the fleeting material policy as it existed
following Golden Globes. The Commission‘s determination
that CBS‘s broadcast of a nine-sixteenths of one second
glimpse of a bare female breast was actionably indecent
evidenced the agency‘s departure from its prior policy. Its
orders constituted the announcement of a policy change – that
fleeting images would no longer be excluded from the scope
of actionable indecency.
The question is whether the FCC‘s departure from its
prior policy is valid and enforceable as applied to CBS. As
noted, agencies are free to change their rules and policies
without judicial second-guessing. See, e.g., Chevron, U.S.A.,
Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837, 863
(1984). But an agency cannot ignore a substantial diversion
from its prior policies. See Ramaprakash v. FAA, 346 F.3d
1121, 1124 (D.C. Cir. 2003) (agency must ―provide a
reasoned analysis indicating that prior policies and standards
are being deliberately changed, not casually ignored‖). As
the Supreme Court explained in State Farm, an agency must
be afforded great latitude to change its policies, but it must
justify its actions by articulating a reasoned analysis behind
the change:
52
Petitioner . . . contend[s] that the rescission of
an agency rule should be judged by the same
standard a court would use to judge an agency‘s
refusal to promulgate a rule in the first place–a
standard Petitioner believes considerably
narrower than the traditional arbitrary and
capricious test and ―close to the borderline of
nonreviewability.‖ We reject this view. . . .
Petitioner‘s view would render meaningless
Congress‘ authorization for judicial review of
orders revoking . . . rules. Moreover, the
revocation of an extant regulation is
substantially different than a failure to act.
Revocation constitutes a reversal of the
agency‘s former views as to the proper course.
A ―settled course of behavior embodies the
agency‘s informed judgment that, by pursuing
that course, it will carry out the policies
committed to it by Congress. There is, then, at
least a presumption that those policies will be
carried out best if the settled rule is adhered to.‖
Accordingly, ―an agency changing its course by
rescinding a rule is obligated to supply a
reasoned analysis for the change beyond that
which may be required when an agency does
not act in the first instance.‖
463 U.S. at 42-43 (citations omitted).
The agency‘s obligation to supply a reasoned analysis
for a policy departure requires an affirmative showing on
record. It ―must examine the relevant data and articulate a
satisfactory explanation for its action including a ‗rational
53
connection between the facts found and the choice made.‘‖
Id. at 43 (quoting Burlington Truck Lines v. United States,
371 U.S. 156, 168 (1962)). A reviewing court ―must
‗consider whether the decision was based on a consideration
of the relevant factors and whether there has been a clear
error of judgment.‘‖ Id. (citations omitted). The agency‘s
actions will then be set aside as ―arbitrary and capricious‖ if
the agency failed to provide a ―reasoned explanation‖ for its
decision to change course. Massachusetts v. EPA, — U.S. —
, 127 S.Ct. 1438, 1463 (2007); see State Farm, 463 U.S. at
42-43; Nat‟l Cable & Telecomms. Ass‟n v. Brand X Internet
Servs., 545 U.S. 967, 981 (2005) (―unexplained
inconsistency‖ in agency practice is a reason for holding a
policy reversal ―arbitrary and capricious‖ under the APA,
unless ―the agency adequately explains the reasons for a
reversal of policy‖).
In Fox, the Second Circuit analyzed the FCC‘s
changed policy on fleeting expletives under State Farm,23 but
23
It was undisputed that the FCC changed its policy on
fleeting expletives in Golden Globes, which was decided
prior to Fox. But as the Fox court explained, the actual
moment the agency changed its course was not pertinent in
determining whether the change was valid under State Farm:
[W]e . . . reject the FCC‘s contention that our
review here is narrowly confined to the specific
question of whether the two Fox broadcasts . . .
were indecent. The [Fox Remand Order]
applies the policy announced in Golden Globes.
If that policy is invalid, then we cannot sustain
54
the panel split on the outcome of its analysis. Judge Pooler,
writing for the majority, found the policy change arbitrary
and capricious because the FCC failed to provide a reasoned
explanation for the change. Fox, 489 F.3d at 455 (―The
Networks contend that the Remand Order is arbitrary and
capricious because the FCC has made a 180-degree turn
regarding its treatment of ‗fleeting expletives‘ without
providing a reasoned explanation justifying the about-face.
We agree.‖). Scrutinizing the sufficiency of the
Commission‘s explanation for its policy change, the court
rejected the agency‘s proffered rationale as ―disconnected
from the actual policy implemented by the Commission.‖ Id.at 459 n.8 (citation omitted).
Judge Leval, writing in dissent, also applied State
Farm, but he disagreed with the amount of deference the
majority afforded the FCC‘s policy decision. Although he
the indecency findings against Fox. Thus, as
the Commission conceded during oral
argument, the validity of the new ―fleeting
expletive‖ policy announced in Golden Globes
and applied in the [Fox Remand Order] is a
question properly before us on this petition for
review.
Fox, 489 F.3d at 454. To hold otherwise would create a
situation ripe for manipulation by an agency. Cf. ACT I,
supra, 852 F.2d at 1337 (―[A]n agency may not resort to [ad
hoc] adjudication as a means of insulating a generic standard
from judicial review.‖).
55
agreed that the FCC was obligated to provide a reasoned
explanation for its policy shift, he found the agency‘s
explanation sufficient. As Judge Leval explained:
In my view, in changing its position on the
repetition of an expletive, the Commission
complied with these requirements. It made
clear acknowledgment that its Golden Globes
and Remand Order rulings were not consistent
with its prior standard regarding lack of
repetition. It announced the adoption of a new
standard. And it furnished a reasoned
explanation for the change. Although one can
reasonably disagree with the Commission‘s new
position, its explanation . . . is not irrational,
arbitrary, or capricious. The Commission thus
satisfied the standards of the Administrative
Procedure[] Act.
Id. at 470 (Leval, J., dissenting).
In this case, State Farm also provides the correct
standard of review, but we need not engage in the substantive
inquiry that divided the Second Circuit panel in Fox. There,
as Judge Leval noted in dissent, the FCC provided an
explanation for changing its policy on fleeting expletives.
The critical question splitting the court was whether that
explanation was adequate under State Farm. Here, unlike in
Fox, the FCC has not offered any explanation – reasoned or
otherwise – for changing its policy on fleeting images.
Rather, the FCC asserts it never had a policy of excluding
fleeting images from the scope of actionable indecency, and
therefore no policy change occurred when it determined that
56
the Halftime Show‘s fleeting image of Janet Jackson‘s breast
was actionably indecent. Accordingly, we must determine
whether the FCC‘s characterization of its policy history is
accurate. If it is not, then the FCC‘s policy change must be
set aside as arbitrary and capricious, because it has failed to
even acknowledge its departure from its former policy let
alone supply a ―reasoned explanation‖ for the change as
required by State Farm.
CBS contends the FCC‘s indecency regime treated
words and images alike, so the exception for fleeting material
applied with equal force to words and images. The
Commission rejects this assertion, contending its prior policy
on fleeting material was limited to words alone. Although the
FCC acknowledges it had never explicitly distinguished
between images and words for the purpose of defining the
scope of actionable indecency, it contends the existence of
such a distinction was obvious, even if unstated.24
24
The FCC‘s position is difficult to reconcile with the
source of its authority to regulate broadcast content. The text
of 18 U.S.C. § 1464 provides: ―Whoever utters any obscene,
indecent, or profane language by means of radio
communication shall be fined under this title or imprisoned
not more than two years, or both.‖ Id. (emphasis added).
Although the text on its face only reaches spoken words, it is
applied broadly, as here, to reach all varieties of indecent
content. But this broad interpretation of the text requires that
the FCC treat words and images interchangeably in order to
fit its regulation of indecent images within the boundaries of
its statutory authority. Where the FCC‘s entire enforcement
regime is built on the agency‘s treatment of words and images
57
The Commission‘s conclusion on the nature and scope
of its indecency regime – including its fleeting material policy
– is at odds with the history of its actions in regulating
indecent broadcasts. In the nearly three decades between the
Supreme Court‘s ruling in Pacifica and CBS‘s broadcast of
the Halftime Show, the FCC had never varied its approach to
indecency regulation based on the format of broadcasted
content. Instead, the FCC consistently applied identical
standards and engaged in identical analyses when reviewing
complaints of potential indecency whether the complaints
were based on words or images.
In 2000, for example, the FCC rejected a complaint of
indecency based on scenes of nudity in a television broadcast
of the film ―Schindler‘s List.‖ In re WPBN/WTOM License
Subsidiary, Inc., 15 F.C.C.R. 1838 (2000). Finding the
broadcasted images not actionably indecent, the FCC noted
―nudity itself is not per se indecent‖ and applied the identical
indecency test the agency used to review potentially indecent
language. Id. at ¶ 11. The Commission did not treat the
nudity complaint differently – factually or legally – from a
complaint for indecency based on a spoken utterance. See id.at ¶ 10 n.5 (―The Supreme Court has observed that contextual
assessments may involve (and are not limited to) an
as functionally identical, it is unclear how the difference
between words and images is ―obvious.‖ At minimum, the
FCC cannot reasonably expect the difference between words
and images to be so self-evident that broadcast licensees
seeking to comply with indecency standards would interpret
FCC enforcement orders narrowly based on whether the
reviewed content consisted of words or images.
58
examination of whether the actual words or depictions in
context are, for example, vulgar or shocking, a review of the
manner in which the words or depictions are portrayed, and
an analysis of whether the allegedly indecent material is
isolated or fleeting.‖ (emphasis added)). The Commission
even referred in a footnote to its policy towards fleeting
material, never suggesting the policy would be inapplicable
because the offending broadcast content was an image rather
than a word. See id. at ¶ 5 n.10 (explaining that contextual
assessments of whether certain programming is patently
offensive, and therefore actionably indecent, ―may involve . .
. analysis of whether the allegedly indecent material is
isolated or fleeting‖).
The Commission took the same approach when
reviewing viewer complaints against a television station for
multiple broadcasts of programs containing expletives,
nudity, and other allegedly indecent material. See WGBH,
supra.25 Categorically denying that the programming in
25
Among several broadcasts at issue in WGBH were: (1)
―numerous episodes of Monty Python‟s Flying Circus, which
allegedly consistently relie[d] primarily on scatology,
immodesty, vulgarity, nudity, profanity and sacrilege for
humor‖; (2) ―a program entitled Rock Follies . . . which [the
petitioner] describe[d] as vulgar and as containing profanity‖
including ―obscenities such as shit, bullshit, etc., and action
indicating some sexually-oriented content in the program‖;
and (3) ―other programs which allegedly contained nudity
and/or sexually-oriented material.‖ 69 F.C.C.R. 1250 at ¶ 2
(internal quotation marks omitted).
59
WGBH was actionably indecent,26 the FCC distinguished the
facts of WGBH from the Carlin monologue in Pacifica by
invoking its restrained enforcement policy for fleeting or
isolated material. See id. at ¶ 10 (―We intend strictly to
observe the narrowness of the Pacifica holding. . . . Justice
Powell‘s concurring opinion . . . specifically distinguished
‗the verbal shock treatment [in Pacifica]‘ from ‗the isolated
use of a potentially offensive word in the course of a radio
broadcast.‘ . . . In the case before us, petitioner has made no
comparable showing of abuse by WGBH-TV of its
programming discretion.‖); id. at ¶ 10 n.6 (finding that
WGBH-TV‘s programs ―differ[ed] dramatically from the
concentrated and repeated assault involved in Pacifica‖). In
its indecency analysis in WGBH, the FCC made no distinction
between words and images (nudity or otherwise).
As evidence that the FCC‘s policy on fleeting material,
as it existed at the time of the Halftime Show, did not
26
The FCC contends WGBH is inapposite because it was a
license revocation proceeding rather than a direct complaint
for indecency. But its analysis in reaching its decision is
instructive. Because the complainant in WGBH challenged
the broadcaster‘s license based on a pattern of allegedly
indecent broadcasts, the Commission expressly answered the
threshold question of whether the broadcasts were indecent.
Separate from the question of whether the broadcaster‘s
actions were sufficient to revoke its license, the
Commission‘s analysis illustrates that ―words‖ and
―depictions‖ were treated identically for purposes of
determining whether a broadcast was actionably indecent.
60
distinguish between words and images, CBS presented
several complaints viewers had submitted to the FCC about
allegedly indecent broadcasts. CBS Letter Br., submitted
pursuant to Fed R. App. P. 28(j) (Aug. 13, 2007).
Accompanying each complaint is a corresponding reply letter
by the FCC rejecting the indecency allegation. Each
complaint involves some variety of sexually explicit imagery.
One letter, for example, describes the early-evening broadcast
of a female adult dancer at a strip club and alleges the
broadcast contained visible scenes of the woman nude from
the waist down revealing exposed buttocks and ―complete
genital nudity‖ for approximately five to seven seconds.
Another letter describes in part a Sunday-morning television
broadcast of the movie ―Devices and Desires,‖ which
included ―scenes of a topless woman in bed with her lover,
with her breast very clearly exposed, several scenes of a
topless woman running on the beach, and several scenes of a
nude female corpse, with the breasts clearly exposed.‖
Citing Pacifica and the indecency standard used to
review the broadcast of potentially indecent language, the
FCC summarily rejected each of these complaints as ―not
actionably indecent.‖ The FCC contends these ―form letters‖
are irrelevant, as the letters ―do not even explain the grounds
for the staff‘s conclusions that the broadcasts were not
indecent, much less rely on the ‗fleeting‘ nature of any
alleged nudity as a reason for rejecting the complaints.‖ FCC
Letter Br., submitted pursuant to Fed R. App. P. 28(j) (Aug.
27, 2007). But the relevance of the FCC‘s rejection letters is
not found in their specific reasons for finding the images not
actionably indecent. Rather, the rejection letters illustrate that
the FCC used the identical form letters and indecency
61
analyses to address complaints of indecent nudity that it had
long used to address complaints of indecent language.
Confronted with this history of FCC enforcement of
restrictions on broadcast indecency, the entirety of which
reveals no distinction in treatment of potentially indecent
images versus words, the FCC nevertheless finds such a
distinction evident in its prior decisions. See, e.g., FCC Br. at
26-27. To support this view, the FCC offers its Notice of
Apparent Liability for Forfeiture in In re Young Broadcasting
of San Francisco, Inc., 19 F.C.C.R. 1751 (2004), issued four
days before CBS‘s broadcast of the Halftime Show. See
Reconsideration Order at ¶¶ 10, 36; FCC Br. at 26-27. Young
Broadcasting involved a morning news show segment in
which two performers from a production titled ―Puppetry of
the Penis‖ appeared in capes but were otherwise naked
underneath the capes. Young Broadcasting at ¶ 13. The two
men, whose act involved manipulating and stretching their
genitalia to simulate various objects, performed a
demonstration of their act with the agreement of the show‘s
hosts and at the urging of off-camera station personnel. Id.Although the performance was directed away from the
camera, the penis of one performer was fully exposed on
camera for less than one second as the men turned away to act
out their performance. See id. at ¶¶ 12, 13. Based on these
facts, the Commission found the station apparently liable for
a forfeiture penalty for broadcasting indecent material. Id. at
¶ 16.
The FCC contends Young Broadcasting was not a
departure from its prior indecency regime. Rather, as it
explains, Young Broadcasting merely represented the first
instance in which the Commission expressly articulated its
62
pre-existing (but unstated) policy of treating fleeting images
differently from fleeting words.27 On this view, according to
the FCC, Young Broadcasting should have dispelled any
doubts about the historical breadth of its fleeting material
policy prior to the Halftime Show because it was issued a few
days before CBS‘s broadcast. But Young Broadcasting is
unavailing for this purpose. It makes no distinction, express
or implied, between words and images in reaching its
indecency determination. To the contrary, it discusses and
compares several other FCC determinations on potentially
indecent utterances and depictions, treating the cases
interchangeably and ultimately distinguishing those cases‘
outcomes without any indication that the format of the
27
Several statements in the FCC‘s own press release
announcing the Young Broadcasting Notice of Apparent
Liability belie the agency‘s contention here that Young
Broadcasting accorded with its prior policies. See Press
Release, FCC, Comm‟n Proposes to Fine Young
Broadcasting of San Francisco, Inc., Statutory Maximum for
Apparent Violation of Indecency Rules (Jan. 27, 2004)
(statement of Chairman Michael K. Powell: ―Today, we open
another front in our increased efforts to curb indecency on our
nation‘s airwaves . . . .‖); id. (statement of Commissioner
Michael J. Copps: ―I am pleased that this Commission is
finally taking an initial step against indecency on
television.‖); id. (statement of Commissioner Kevin J. Martin:
―I hope that this step today represents the beginning of a
commitment to consider each indecency complaint seriously .
. . .‖).
63
offending material was a relevant consideration. See, e.g., id.at ¶ 12 & n.35; id. at ¶ 14.28
Accordingly, Young Broadcasting does not support the
FCC‘s assertion here that its policy on fleeting material had
always excluded images and applied only to words. Young
Broadcasting appears instead to be best understood as the
28
One of the cases the FCC distinguished in Young
Broadcasting was its Notice of Apparent Liability in Flambo
Broadcasting, Inc. (KFMH-FM), 9 F.C.C.R. 1681 (MMB
1994), which involved ―a radio station‘s broadcast of sexual
material in a crude joke‖ that was not found actionably
indecent. Young Broadcasting at ¶ 12 n.35. As with the other
cases it discussed in its Young Broadcasting Notice of
Apparent Liability, the FCC did not draw any distinction
between Young Broadcasting and Flambo Broadcasting
based on the subject material there being words or images.
But it did distinguish the two notices of apparent liability in
part because: ―assuming that the joke [at issue in Flambo
Broadcasting] was cut off immediately, the staff of the then-
Mass Media Bureau found that it would not have been
actionably indecent because it was brief, live, unscripted and
from an outside source.‖ Young Broadcasting at ¶ 12 n.35
(emphasis added). Notably, the facts here – a brief image of a
bare female breast during the live Halftime Show broadcast
resulting from an unscripted stunt by Jackson and Timberlake
– are remarkably similar to the Flambo Broadcasting fact
pattern that the FCC found readily distinguishable from the
actionably indecent material in Young Broadcasting.
64
Commission‘s initial effort to abandon its restrained
enforcement policy on fleeting material. While the final
disposition of Young Broadcasting was still unresolved,29 the
overarching policy departure that the Commission sought to
accomplish there was effectuated by a combination of its
Golden Globes order and its orders on appeal here. The
Commission‘s reasoning in Young Broadcasting is therefore
illuminating here.
29
Young Broadcasting was a notice of apparent liability,
which is non-final until the implicated licensee either declines
to dispute the findings in the notice or the licensee‘s
responsive opposition is fully adjudicated. See FCC Br. at 13
(describing content of CBS Notice of Apparent Liability as
―tentative conclusions‖); see also 47 U.S.C. § 504(c) (―In any
case where the Commission issues a notice of apparent
liability looking toward the imposition of a forfeiture under
this chapter, that fact shall not be used, in any other
proceeding before the Commission, to the prejudice of the
person to whom such notice was issued, unless (i) the
forfeiture has been paid, or (ii) a court of competent
jurisdiction has ordered payment of such forfeiture, and such
order has become final.‖). At the time the Commission
issued its Reconsideration Order against CBS and after its
determination in Golden Globes, the question of whether the
broadcast licensee in Young Broadcasting would contest the
Notice of Apparent Liability in that case was still unresolved.
See Reconsideration Order at ¶ 6 n. 25 (indicating the status
of the Young Broadcasting Notice of Apparent Liability as
―response pending‖ at the time of the Reconsideration
Order‘s issuance).
65
In Young Broadcasting, the Commission distinguished
that case‘s facts from several of its prior orders. But in so
doing, the Commission overlooked the fact that application of
its fleeting material policy had been a determinative factor in
those prior orders. For example, the licensee in Young
Broadcasting cited for support L.M. Communications, 7
F.C.C.R. 1595 (1992), in which the radio broadcast of a
single expletive was found not actionably indecent. Young
Broadcasting at ¶ 12 n.35. The FCC found L.M.
Communications ―distinguishable because there was no
finding that the material, in context, was pandering, titillating
or intended to shock the audience.‖ Id. But L.M.
Communications made no reference to the pandering,
titillating or shocking nature of the subject broadcast material.
Rather, it determined the material was not actionably indecent
because the ―broadcast contained only a fleeting and isolated
utterance which, within the context of live and spontaneous
programming, does not warrant a Commission sanction.‖
L.M. Commc‟ns, 7 F.C.C.R. at 1595.
The Commission‘s failure to acknowledge the
existence of its prior policy on fleeting material in Young
Broadcasting is illustrative of its approach here. In Young
Broadcasting, it read the policy out of existence by
substituting new rationales for its prior indecency
determinations that had applied the policy. Here, the
Commission is foreclosed from adopting the same approach
by its admission in Golden Globes that the fleeting material
policy existed. So it instead apparently seeks to revise the
scope of the policy by contending the policy never included
fleeting images. But extensive precedent over thirty years of
indecency enforcement demonstrates otherwise.
66
Our reluctant conclusion that the FCC has advanced
strained arguments to avoid the implications of its own
fleeting indecency policy was echoed by our sister circuit in
Fox:
In [its Omnibus Order], the FCC ―reject[s]
Fox‘s suggestion that Nicole Richie‘s [use of
two expletives] would not have been actionably
indecent prior to our Golden Globes decision,‖
and would only concede that it was ―not
apparent‖ that Cher‘s [use of one expletive] at
the 2002 Billboard Music Awards would have
been actionably indecent at the time it was
broadcast. [Id.] at ¶¶ 22, 60. Decisions
expressly overruled in Golden Globes were now
dismissed as ―staff letters and dicta,‖ and the
Commission even implied that the issue of
fleeting expletives was one of first impression
for the FCC in Golden Globes. Id. at ¶ 21 (―[I]n
2004, the Commission itself considered for the
first time in an enforcement action whether a
single use of an expletive could be considered
indecent.‖).
Fox, 489 F.3d at 456 n.6. When confronted with these
troublesome revisionist arguments, the FCC conceded the
existence of its prior policy. See id. at 456 (―[I]n its brief to
this court, the FCC now concedes that Golden Globes
changed the landscape with regard to fleeting expletives.‖
(citations omitted)); see also id. at 470 (Leval, J., dissenting)
(―[The FCC] made clear acknowledgment that its Golden
Globes and Remand Order rulings were not consistent with
its prior standard regarding lack of repetition.‖). But it has
67
made no such concession here. Faced with extensive
evidence to the contrary, the Commission nevertheless
continues to assert that its fleeting material policy was limited
to words and did not exclude fleeting images from the scope
of actionable indecency.
In sum, the balance of the evidence weighs heavily
against the FCC‘s contention that its restrained enforcement
policy for fleeting material extended only to fleeting words
and not to fleeting images. As detailed, the Commission‘s
entire regulatory scheme treated broadcasted images and
words interchangeably for purposes of determining
indecency. Therefore, it follows that the Commission‘s
exception for fleeting material under that regulatory scheme
likewise treated images and words alike. Three decades of
FCC action support this conclusion. Accordingly, we find the
FCC‘s conclusion on this issue, even as an interpretation of
its own policies and precedent, ―counter to the evidence
before the agency‖ and ―so implausible that it could not be
ascribed to a difference in view or the product of agency
expertise.‖ State Farm, 463 U.S. at 43.
Because the Commission fails to acknowledge that it
has changed its policy on fleeting material, it is unable to
comply with the requirement under State Farm that an agency
supply a reasoned explanation for its departure from prior
policy.19 See id.; cf. Ramaprakash, 346 F.3d at 1125
19
In its brief and at oral argument, the Commission
continues to assert it has not changed its policy on fleeting
material, yet it also suggests several reasons why a policy
including fleeting images within the scope of actionable
indecency is reasonable. But see State Farm, 463 U.S. at 50
68
(―[F]ailure to come to grips with conflicting precedent
constitutes an [agency‘s] inexcusable departure from the
essential requirement of reasoned decision making.‖);
LeMoyne-Owen College v. NLRB, 357 F.3d 55, 61 (D.C. Cir.
2004) (Roberts, J.) (―[W]here, as here, a party makes a
significant showing that analogous cases have been decided
differently, the agency must do more than simply ignore that
argument. . . . The need for an explanation is particularly
acute when an agency is applying a multi-factor test through
case-by-case adjudication.‖). Consequently, the FCC‘s new
policy of including fleeting images within the scope of
actionable indecency is arbitrary and capricious under State
Farm and the Administrative Procedure Act, and therefore
invalid as applied to CBS.
IV.
In finding CBS liable for a forfeiture penalty, the FCC
arbitrarily and capriciously departed from its prior policy
excepting fleeting broadcast material from the scope of
actionable indecency. Therefore, we will grant CBS‘s
petition for review and will vacate the Commission‘s order in
its entirety.
(―[T]he courts may not accept appellate counsel‘s post hoc
rationalizations for agency action. It is well-established that
an agency‘s action must be upheld, if at all, on the basis
articulated by the agency itself.‖ (internal citations omitted)).
69
CBS v. FCC, No. 06-3575
SCIRICA, Circuit Judge, Dissenting
This case comes to us on remand from the Supreme
Court of the United States. CBS petitions for review of
orders by the Federal Communications Commission imposing
a monetary forfeiture under 47 U.S.C. § 503(b) for the
broadcast of ―indecent‖ material in violation of 18 U.S.C. §
1464 and 47 C.F.R. § 73.3999. I believe the Supreme Court‘s
intervening opinion in FCC v. Fox Television Stations, Inc.,
129 S. Ct. 1800 (2009), undermines the basis of our prior
holding on the Administrative Procedure Act.1 Accordingly,
I respectfully dissent and would hold the FCC‘s imposition of
a civil forfeiture here is neither arbitrary nor capricious.
Furthermore, I would hold precedent requires we remand to
the FCC for it to apply the proper standard for ordering a civil
forfeiture for the broadcast of indecent material.
The alleged indecency occurred during the Halftime
Show of Super Bowl XXXVIII, broadcast live by CBS on
February 1, 2004. The Show‘s finale involved a routine by
Janet Jackson and Justin Timberlake. In an unscripted
moment at the end of the performance, Timberlake tore away
part of Jackson‘s bustier, exposing her bare right breast to the
camera. The image was broadcast over public airwaves for
nine-sixteenths of one second.
At issue is the responsibility of television broadcasters
for the transmission of unscripted ―indecent‖ material during
1
My colleagues incorporate portions of our earlier decision in
Part B of their opinion. Since I believe Fox requires a
different result, I would omit our prior opinion.
1
live, contemporaneous television shows. Broadcast television
(as opposed to transmissions over cable, satellite, or internet)
is subject to greater oversight because the finite number of
broadcast frequencies are allocated among competing
applicants. See Red Lion Broad. Co. v. FCC, 395 U.S. 367,
376 (1969) (―Without government control, the medium would
be of little use because of the cacophony of competing voices,
none of which could be clearly and predictably heard.‖); cf.
FCC v. Pacifica Found., 438 U.S. 726, 748 (1978) (―[O]f all
forms of communication, it is broadcasting that has received
the most limited First Amendment protection.‖). The
―scarcity doctrine‖—the idea that limited broadcast spectrum
and practical factors make television broadcasting unique
among media—―has required some adjustment in First
Amendment analysis.‖ FCC v. League of Women Voters, 468
U.S. 364, 376-77 (1984).2
2
CBS and others have questioned whether broadcasting
continues to be a unique medium. The Court, however, has
so far declined to abandon the scarcity doctrine without the
support of Congress or the FCC. See League of Women
Voters, 468 U.S. at 376 n.11 (―The prevailing rationale for
broadcast regulation based on spectrum scarcity has come
under increasing criticism . . . . We are not prepared,
however, to reconsider our longstanding approach without
some signal from Congress or the FCC that technological
developments have advanced so far that some revision of the
system of broadcast regulation may be required.‖); see also
Petition for Writ of Certiorari at 2-8, FCC v. Fox Television
Stations, Inc., 131 S. Ct. 3065 (2011) (No. 10-1293), 2011
WL 1540430 at *2-8 (providing the Solicitor General‘s view
on the development of indecency policy and the unique
position of broadcast television).
2
In our earlier decision, we invalidated the FCC‘s
determination that CBS‘s broadcast of a fleeting image of
nudity was actionably indecent. Examining the history of the
FCC‘s enforcement of the indecency standard, we concluded
the FCC‘s policy had been to treat unscripted fleeting
material as per se exempt from regulation. Because we
believed the FCC‘s forfeiture orders against CBS constituted
an unacknowledged change in policy, we held they violated
the Administrative Procedure Act‘s (APA) prohibition on
arbitrary and capricious agency action. See 5 U.S.C. §
706(2)(A). Furthermore, even assuming the fleeting image of
nudity was actionably indecent, we concluded CBS could not
be held liable for the broadcast unless it acted with scienter,
and it was unclear whether the FCC had applied the proper
standard. Accordingly, we vacated the FCC‘s orders and
remanded to allow the FCC an opportunity to reconsider its
indecency standard and the mens rea for broadcaster liability.
The FCC filed a petition for certiorari. While that
petition was pending, the Supreme Court decided FCC v. Fox
Television Stations, Inc., 129 S. Ct. 1800 (2009). The
question presented in Fox was whether the FCC had violated
the APA in issuing orders holding Fox liable for isolated
expletives broadcast during the 2002 and 2003 Billboard
Music Awards. The Court held the FCC had adequately
explained its decision such that its orders were neither
arbitrary nor capricious under the APA. Soon after deciding
Fox, the Court granted the FCC‘s petition for certiorari in this
case, vacated our judgment, and remanded for us to
reconsider the case in light of Fox. FCC v. CBS Corp., 129 S.
Ct. 2176 (2009).
In Fox, unlike here, the FCC acknowledged it was
departing from precedent. Nevertheless, I believe the Court‘s
3
intervening decision in Fox requires us to revise our prior
APA holding. Based on the Supreme Court‘s account of the
history of the FCC‘s enforcement policy, we cannot adhere to
our earlier determination that prior FCC policy had granted a
per se exemption to all fleeting indecent material; instead,
Fox compels the conclusion that the fleeting exemption was
limited to a particular type of words. Accordingly, under
Fox, I cannot say the orders in this case represented a change
in agency policy, and I would hold the FCC‘s indecency
finding passes muster under the APA. The FCC, however,
cannot impose a forfeiture penalty unless CBS acted with the
requisite scienter. Because I believe the FCC‘s forfeiture
orders rested on the wrong statutory provision, and
misapprehended the proper mens rea standard, I would vacate
the orders and remand for further proceedings.
I.
A.
Our previous opinion set forth the relevant facts:
On February 1, 2004, CBS presented a
live broadcast of the national Football League‘s
Super Bowl XXXVIII, which included a
halftime show produced by MTV Networks.
Nearly 90 million viewers watched the Halftime
Show, which began at 8:30 p.m. Eastern
Standard Time and lasted about fifteen minutes.
The Halftime Show featured a variety of
musical performances by contemporary
recording artists, with Janet Jackson as the
announced headlining act and Justin Timberlake
as a ―surprise guest‖ for the final minutes of the
4
show.
Timberlake was unveiled on stage near
the conclusion of the Halftime Show. He and
Jackson performed his popular song ―Rock
Your Body‖ as the show‘s finale. Their
performance, which the FCC contends involved
sexually suggestive choreography, portrayed
Timberlake seeking to dance with Jackson, and
Jackson alternating between accepting and
rejecting his advances. The performance ended
with Timberlake singing, ―gonna have you
naked by the end of this song,‖ and
simultaneously tearing away part of Jackson‘s
bustier. CBS had implemented a five-second
audio delay to guard against the possibility of
indecent language being transmitted on air, but
it did not employ similar precautionary
technology for video images. As a result,
Jackson‘s bare right breast was exposed on
camera for nine-sixteenths of one second.
CBS Corp. v. FCC, 535 F.3d 167, 171-72 (3d Cir. 2008)
(footnote omitted).
After fielding a large number of complaints from
viewers of the Halftime Show, the FCC issued a letter of
inquiry to CBS seeking additional information about the
broadcast. CBS complied. It also made ―a public statement
of apology for the incident,‖ stating that ―Jackson and
Timberlake‘s wardrobe stunt was unscripted and
unauthorized‖ and ―claiming it had no advance notice of any
plan by the performers to deviate from the script.‖ Id. at 172.
On September 22, 2004, the FCC issued a Notice of
5
Apparent Liability finding that CBS had apparently violated
federal law and FCC rules regulating the broadcast of
indecency and was apparently liable for a forfeiture penalty of
$550,000. CBS submitted its Opposition to the Notice.
On March 15, 2006, the FCC issued a forfeiture order
and imposed a penalty of $550,000. In re Complaints Against
Various Television Licensees Concerning Their Feb. 1, 2004
Broad. of the Super Bowl XXXVIII Halftime Show, 21 FCC
Rcd. 2760 (2006) (―Forfeiture Order‖). Applying the
standard set forth in its 2001 policy statement, the FCC found
the Halftime Show incident satisfied the two-part test for
indecency: (1) ―the material must describe or depict sexual or
excretory organs or activities,‖ and (2) it must be ―patently
offensive as measured by contemporary community standards
for the broadcast medium.‖ In re Industry Guidance on the
Comm‟n‟s Case Law Interpreting 18 U.S.C. § 1464 and
Enforcement Policies Regarding Broad. Indecency, 16 FCC
Rcd. 7999, 8002, ¶¶ 7–8 (2001) (―Industry Guidance‖); see
Forfeiture Order, 21 FCC. Rcd. at 2764–65, ¶ 9. Finding the
―broadcast of an exposed female breast‖ met the first part of
the test, the FCC focused most of its analysis on whether the
broadcast was ―patently offensive.‖ Forfeiture Order, 21
FCC Rcd. at 2764–67, ¶¶ 9–14.
The FCC‘s 2001 policy statement had explained that in
determining whether broadcast material is patently offensive,
―the full context in which the material appeared is critically
important.‖ Industry Guidance, 16 FCC Rcd. at 8002, ¶ 9.
Three factors are of principal significance: ―(1) the
explicitness or graphic nature of the description or depiction
of sexual or excretory organs or activities; (2) whether the
material dwells on or repeats at length descriptions of sexual
or excretory organs or activities; (3) whether the material
6
appears to pander or is used to titillate, or whether the
material appears to have been presented for its shock value.‖
Id. at 8003, ¶ 10 (emphasis removed). According to the
policy statement, ―[n]o single factor generally provides the
basis for an indecency finding‖; the three factors ―must be
balanced‖ to determine whether a given broadcast is patently
offensive. Id.Applying these factors in its Forfeiture Order, the
FCC determined that, ―in context and on balance,‖ the
Halftime Show material was ―patently offensive.‖ 21 FCC
Rcd. at 2765, ¶ 10. The FCC conceded the second factor
weighed against a finding of indecency because ―the image of
Jackson‘s uncovered breast . . . is fleeting.‖ Id. at 2766, ¶ 12.
It noted, however, that ―‗even relatively fleeting references
may be found indecent where other factors contribute to a
finding of patent offensiveness,‘‖ and concluded ―[i]n this
case, . . . the brevity of the partial nudity is outweighed by the
first and third factors of our contextual analysis.‖ Id. (quoting
Industry Guidance, 16 FCC Rcd. at 8009, ¶ 19). In the FCC‘s
view, the image was ―graphic and explicit‖ because ―although
the camera shot is not a close-up, the nudity is readily
discernible[,] . . . Jackson and Timberlake, as the headline
performers, are in the center of the screen, and Timberlake‘s
hand motion ripping off Jackson‘s bustier draws the viewer‘s
attention to her exposed breast.‖ Id. at 2765, ¶ 11. The FCC
also believed, taken in context, the material appeared to
shock, pander to, or titillate the audience:
The offensive segment in question did not
merely show a fleeting glimpse of a woman‘s
breast . . . . Rather, it showed a man tearing off
a portion of a woman‘s clothing to reveal her
naked breast during a highly sexualized
7
performance and while he sang ―gonna have
you naked by the end of this song.‖
Id. at 2767, ¶ 13. On the strength of these two factors, the
FCC found the image actionably indecent.
The Forfeiture Order also found that CBS was liable
under 47 U.S.C. § 503(b)(1) for Timberlake and Jackson‘s
performance. CBS claimed ―it had no advance knowledge
that Timberlake planned to tear off part of Jackson‘s clothing
to reveal her breast.‖ Id. at 2768, ¶ 17. The FCC did not
dispute this contention, but it nonetheless determined CBS
was subject to a monetary forfeiture. Id. at 2769-74, ¶¶ 18–
25.
CBS submitted a Petition for Reconsideration
challenging several aspects of the FCC‘s analysis. In an
Order on Reconsideration filed on May 31, 2006, the FCC
reaffirmed the $550,000 forfeiture. In re Complaints Against
Various Television Licensees Concerning Their Feb. 1, 2004
Broad. of the Super Bowl XXXVIII Halftime Show, 21 FCC
Rcd. 6653 (2006) (―Reconsideration Order‖). The Order
rejected CBS‘s constitutional arguments and reiterated the
FCC‘s indecency finding. The Reconsideration Order
revised the FCC‘s approach for determining CBS‘s liability
under § 503(b)(1). According to the Order, there were three
independent bases for CBS‘s liability. First, despite the fact
the network ―was acutely aware of the risk of unscripted
indecent material in [the Halftime Show],‖ it ―consciously
and deliberately failed to take reasonable precautions to
ensure that no actionably indecent material was broadcast.‖
Reconsideration Order, 21 FCC Rcd. at 6660, ¶ 17; accord
id. at 6662, ¶ 23 (stating that the FCC‘s ―finding of
willfulness is based on CBS‘s knowledge of the risks and its
8
conscious and deliberate omissions of the acts necessary to
address them‖). Second, the FCC found Jackson and
Timberlake performed as employees of CBS, not independent
contractors. Accordingly, CBS was vicariously liable for
their actions under the doctrine of respondeat superior. Id. at
6662-64, ¶¶ 24–28. Third, even if Timberlake and Jackson
were independent contractors, CBS would still be liable for
their actions in the FCC‘s view because of ―the nondelegable
nature of broadcast licensees‘ responsibility for their
programming.‖ Id. at 6662, ¶ 23. For these reasons, the FCC
refused to rescind or reduce its forfeiture penalty.
B.
CBS timely filed a petition for review of the
Reconsideration Order on July 28, 2006. In our previous
opinion, we agreed with CBS that the order‘s indecency
finding violated the APA. CBS, 535 F.3d at 175. We
acknowledged that ―[t]he scope of review under the [APA‘s]
‗arbitrary and capricious‘ standard is ‗narrow, and a court is
not to substitute its judgment for that of the agency,‘‖ and that
―[l]ike any agency, the FCC may change its policies without
judicial second-guessing.‖ Id. at 174–75 (quoting Motor
Vehicle Mfrs. Ass‟n v. State Farm Mut. Auto. Ins. Co., 463
U.S. 29, 43 (1983)). But we noted the FCC ―cannot change a
well-established course of action without supplying notice of
and a reasoned explanation for its policy departure.‖ Id. at
175.
We concluded the FCC violated that principle here by
failing to acknowledge or explain a departure from ―a
consistent and entrenched policy of excluding fleeting
broadcast material from the scope of actionable indecency.‖
Id. at 179. In our view, it was not until its Golden Globes
9
decision, issued more than a month after the Halftime Show,
that the agency expressly ―overruled all of its prior cases
holding [isolated or fleeting material] not actionable.‖ Id. at
178; see In re Complaints Against Various Broad. Licensees
Regarding Their Airing of the “Golden Globe Awards”
Program, 19 FCC Rcd. 4975, 4980, ¶ 12 (2004) (―Golden
Globes‖) (―While prior Commission and staff action had
indicated that isolated or fleeting broadcasts of the ‗F-Word‘
such as that here are not indecent or would not be acted upon,
consistent with our decision today we conclude that any such
interpretation is no longer good law.‖). Before this date, we
believed, ―the FCC‘s policy was to exempt fleeting or
isolated material‖ from indecency regulation. CBS, 535 F.3d
at 180. ―Because CBS broadcasted the Halftime Show prior
to Golden Globes, this was the policy in effect when the
incident with Jackson and Timberlake occurred.‖ Id.Accordingly, by finding the fleeting image here to be
actionably indecent, the FCC‘s orders in this case broke with
agency policy. And since these orders failed to acknowledge
the existence of that policy, we determined they were ―unable
to comply with the [APA‘s] requirement . . . that an agency
supply a reasoned explanation for its departure‖ from its prior
policy. Id. at 188.
As this account suggests, our construction of the
FCC‘s enforcement history played a decisive role in our
previous opinion. That opinion recounted this history in
detail, see id. at 175–89, but a synopsis is necessary here in
order to make clear the significance of the Supreme Court‘s
decision in Fox. The FCC‘s indecency policy had its genesis
in 1975, when the FCC issued a forfeiture penalty against
Pacifica Foundation for broadcasting comedian George
10
Carlin‘s ―Filthy Words‖ monologue.3 See In re Citizen‟s
Complaint Against Pacifica Found., Station WBAI(FM), New
York, N.Y., 56 F.C.C. 2d 94 (1975). ―Carlin‘s monologue,
which Pacifica aired in an early-afternoon time slot, contained
extensive and repetitive use of several vulgar expletives over
a period of twelve minutes.‖ CBS, 535 F.3d at 175 (citing
Pacifica, 438 U.S. at 739). While Pacifica‘s appeal was
pending before the United States Court of Appeals for the
D.C. Circuit, the FCC ―issued a clarification order . . .
expressly limiting its prior forfeiture order to the specific
facts of the Carlin monologue.‖ Id. (citing In re a „Petition
for Clarification or Reconsideration‟ of a Citizen‟s Complaint
against Pacifica Found., Station WBAI(FM), New York, N.Y.,
59 F.C.C. 2d 892 (1976)). The D.C. Circuit reversed the
FCC‘s forfeiture order as vague and overbroad, Pacifica
Found. v. FCC, 556 F.2d 9, 14 (D.C. Cir. 1977), but the
Supreme Court upheld the agency‘s action in a narrow
plurality opinion, 438 U.S. 726 (1978). The plurality
―confirmed the general validity of the FCC‘s indecency
regime‖ while at the same time ―‗emphasiz[ing] the
narrowness of [its] holding,‘ which it confined to the facts of
the Carlin monologue.‖ CBS, 535 F.3d at 176 (quoting
Pacifica, 438 U.S. at 750) (alterations in original). Justices
Powell and Blackmun concurred in the judgment and wrote
separately to underscore ―the narrowness of the decision and
to note the Court‘s holding did not ‗speak to cases involving
the isolated use of a potentially offensive word in the course
3
―Congress authorized the FCC to impose forfeiture penalties
for violations of 18 U.S.C. § 1464 in 1960.‖ CBS, 535 F.3d at
175; see Communications Act Amendments, 1960, Pub. L.
No. 86-752, § 7, 74 Stat. 889, 894 (codified as amended at 47
U.S.C. § 503(b)(1)).
11
of a radio broadcast, as distinguished from the verbal shock
treatment administered by respondent here.‘‖ Id. (quoting
Pacifica, 438 U.S. at 760–61 (Powell, J., concurring)).
Our previous opinion found that the FCC adopted a
―restrained enforcement policy . . . in the years following
Pacifica.‖ Id. In a 1978 opinion, the FCC rejected a
challenge to ―several programs containing nudity and other
allegedly offensive material.‖ Id.; see In re Application of
WGBH Educ. Found., 69 F.C.C. 2d 1250 (1978) (―WGBH‖).
The agency, noting it ―‗intend[ed] strictly to observe the
narrowness of the Pacifica holding‘ and emphasizing the
language in Justice Powell‘s concurring opinion, concluded
the single use of an expletive in a program ‗should not call for
us to act under the holding of Pacifica.‘‖ Id. (quoting WGBH,
69 F.C.C. 2d at 1254, ¶ 10 n.6) (alteration in CBS).
In our view, three decisions issued in 1987 had
―reaffirmed the Commission‘s restrained enforcement policy
and reiterated the agency‘s policy that isolated or fleeting
material would not be considered actionably indecent.‖ Id.We acknowledged that, in a subsequent order reconsidering
these decisions, ―the Commission abandoned the view that
only the particular ‗dirty words‘ used in the Carlin monologue
could be indecent,‖ but we observed that the order on
reconsideration ―never indicat[ed] disagreement with those
decisions‘ express statements that isolated or fleeting material
could not be actionably indecent.‖ CBS, 535 F.3d at 177; see
In re Infinity Broad. Corp., 3 FCC Rcd. 930 (1987), vacated
in part on other grounds, Action for Children‟s Television v.
FCC, 852 F.2d 1332, 1337 (D.C. Cir. 1988), superseded in
part by Action for Children‟s Television v. FCC, 58 F.3d 654(D.C. Cir. 1995) (en banc).
12
As noted, our earlier opinion concluded the Golden
Globes opinion of March 3, 2004, was the first time the FCC
indicated that fleeting material could be held indecent. That
case involved an unscripted remark during a live NBC
broadcast of the Golden Globe Awards on January 19, 2003,
in which ―musician Bono said ‗this is really, really f[* * *]
brilliant‘ while accepting an award.‖ CBS, 535 F.3d at 177;
see Golden Globes, 19 FCC Rcd. at 4976, ¶ 3 n.4. The FCC
held the broadcast actionable, but it declined to impose a
forfeiture penalty because ―existing precedent would have
permitted th[e] broadcast.‖ See Golden Globes, 19 FCC Rcd.
at 4981-82, ¶ 15 n.40 (citing Trinity Broad. of Fla., Inc. v.
FCC, 211 F.3d 618 (D.C. Cir. 2000)). We believed Golden
Globes itself ―made it clear that licensees could not be held
liable for broadcasting fleeting or isolated indecent material
prior to its Golden Globes decision.‖ CBS, 535 F.3d at 178.
On February 21, 2006, the FCC issued an omnibus
order resolving multiple indecency complaints against
television broadcasters. See In re Complaints Regarding
Various Television Broads. Between Feb. 2, 2002 and Mar. 8,
2005, 21 FCC Rcd. 2664 (2006). The Order found four
programs, all of which involved the use of expletives,4 to be
4
The four programs were: ―(1) Fox‘s broadcast of the 2002
Billboard Music Awards, in which performer Cher used an
unscripted expletive during her acceptance speech; (2) Fox‘s
broadcast of the 2003 Billboard Music Awards, in which
presenter Nicole Richie used two unscripted expletives; (3)
ABC‘s broadcast of various episodes of its NYPD Blue
series, in which assorted characters used scripted expletives;
and (4) a CBS broadcast of The Early Show, in which a guest
used an unscripted expletive during a live interview.‖ CBS,
13
indecent. But ―[b]ecause the offending broadcasts occurred
prior to the issuance of its Golden Globes decision, the FCC
concluded that existing precedent would have permitted the
broadcasts. Accordingly, the FCC did not issue forfeiture
orders against any of the licensees.‖ CBS, 535 F.3d at 178(internal citations removed).
The networks nonetheless appealed the Order, which,
as revised,5 was invalidated in a 2-1 decision by the United
States Court of Appeals for the Second Circuit. See Fox
Television Stations, Inc. v. FCC, 489 F.3d 444 (2d Cir. 2007),
rev‟d, 129 S. Ct. 1800 (2009). Our earlier opinion explicitly
refrained from engaging the issue that split the Second Circuit
panel, see CBS, 535 F.3d at 182–83; we focused instead on
that court‘s unanimous finding that the FCC‘s enforcement
policy ―prior to the Golden Globes decision [had consistently]
excluded fleeting or isolated expletives from regulation,‖ id.at 179 (citing Fox, 489 F.3d at 455). That conclusion, we
believed, confirmed our view that until Golden Globes, the
FCC‘s policy ―was to exclude fleeting material from the
scope of actionable indecency.‖ Id. at 179 n.10.
The FCC did not categorically deny that its policy had
535 F.3d at 178 (citing Various Television Broads., 21 FCC
Rcd. at ¶¶ 101, 112 n.64, 125, 137).
5
See In re Complaints Regarding Various Television Broads.
Between Feb. 2, 2002 and Mar. 8, 2005, 21 FCC Rcd. 13299
(2006). The revised order reversed the finding that The Early
Show broadcast was indecent and dismissed the complaint
against ABC on procedural grounds. Id. at 13299, ¶ 1. The
order reviewed by the Second Circuit (and subsequently by
the Supreme Court) thus contained indecency determinations
only as to the two Billboard Music Awards broadcasts.
14
exempted fleeting content from regulation. But it
contended—and continues to contend—that the exemption
had been limited to fleeting expletives and had never applied
to fleeting images such as the one at issue here. According to
the FCC, the Golden Globes opinion simply eliminated the
exceptional treatment of fleeting expletives and subjected all
broadcast content to the same contextual, multi-factor test, in
which the material‘s fleeting nature is but one consideration
to be weighed in the balance. Our previous opinion rejected
this interpretation. We concluded that, on the contrary, ―[i]n
the nearly three decades between the Supreme Court‘s ruling
in Pacifica and CBS‘s broadcast of the Halftime Show, the
FCC had never varied its approach to indecency regulation
based on the format of broadcasted content.‖ Id. at 184; see
id. at 181 (―[T]he Commission—before Golden Globes—had
not distinguished between categories of broadcast material
such as images and words.‖); see also id. at 180 (―Until its
Golden Globes decision . . . the FCC‘s policy was to exempt
fleeting or isolated material from the scope of actionable
indecency.‖ (emphasis added)). In our view, fleeting images,
like all other fleeting content, were immune from regulation
under the pre-Golden Globes regime. Accordingly, we
believed that if the FCC were right that ―Golden Globes only
addressed expletives, . . . a residual [per se exemption] policy
on other categories of fleeting material—including all
broadcast content other than expletives—remained in effect,‖
and that ―subsequent agency action was required to change
the fleeting material policy as it applied‖ to these remaining
categories. Id. at 181.
The FCC had insisted that ―any doubts about the
historical breadth of its fleeting material policy prior to the
Halftime Show‖ should have been ―dispelled‖ by the FCC‘s
15
decision in In re Young Broadcasting of San Francisco, Inc.,
19 FCC Rcd. 1751 (2004), issued a few days before CBS‘s
Super Bowl broadcast. CBS, 535 F.3d at 186. There, the
FCC issued a Notice of Apparent Liability for Forfeiture to:
a morning news show segment in which two
performers from a production titled ―Puppetry
of the Penis‖ appeared in capes but were
otherwise naked underneath the capes. The two
men, whose act involved manipulating and
stretching their genitalia to simulate various
objects, performed a demonstration of their act
with the agreement of the show‘s hosts and at
the urging of off-camera station personnel.
Although the performance was directed away
from the camera, the penis of one performer
was fully exposed on camera for less than one
second as the men turned away to act out their
performance.
Id. (citing Young Broad., 19 FCC Rcd. at 1755-56, ¶¶ 12, 13).
The FCC conceded that the offending image was ―fleeting‖
but concluded it was nonetheless indecent given its explicit
and pandering qualities. Young Broad., 19 FCC Rcd. at
1755-57, ¶¶ 11–14. In the FCC‘s view, Young Broadcasting
should have made clear to CBS that the fleetingness of an
offending image would not necessarily immunize the
broadcaster from liability.
Our previous opinion found this argument
unconvincing. We believed the FCC‘s action in Young
Broadcasting was hobbled by the same flaw that afflicted the
forfeiture orders against CBS: it ―fail[ed] to acknowledge the
existence of [the FCC‘s] prior policy on fleeting material,‖
16
instead ―read[ing] the policy [of exempting fleeting material]
out of existence by substituting new rationales for its prior
indecency determinations that had applied the policy.‖ CBS,
535 F.3d at 187. Because Young Broadcasting was, we
believed, an invalid ―initial effort to abandon [the FCC‘s]
restrained enforcement policy on fleeting material,‖ id., that
policy remained in effect at the time of the Halftime Show.
And since the forfeiture orders against CBS similarly
―fail[ed] to acknowledge‖ a change in FCC policy ―on
fleeting material,‖ they were ―unable to comply with the
requirement . . . that an agency supply a reasoned explanation
for its departure from prior policy.‖ Id. at 188 (citing State
Farm, 463 U.S. at 43). In sum, Young Broadcasting did not
alter our conclusion that the FCC‘s orders violated the APA.
This violation of the APA was not the only flaw we
identified in the FCC‘s orders. Even assuming the FCC‘s
indecency finding had been valid, we would have found ―the
Commission [had] incorrectly determined CBS‘s liability for
Jackson and Timberlake‘s Halftime Show performance.‖ Id.
at 189. Two of the FCC‘s three arguments for liability were
untenable. First, the agency ―contend[ed] the performers‘
intent c[ould] be imputed to CBS under the common law
doctrine of respondeat superior.‖ Id. We concluded,
however, that ―Jackson and Timberlake were independent
contractors, who are outside the scope of respondeat
superior, rather than employees as the FCC found.‖ Id. at
189–98. Second, the FCC argued ―because broadcast
licensees hold non-delegable duties to avoid the broadcast of
indecent material and to operate in the public interest,‖ they
are vicariously liable for the acts of even their independent
contractors. Id. at 198. This proposition, we believed, could
not be reconciled with the First Amendment. ―[A]n unwitting
17
broadcaster might be held liable for its independent
contractor‘s negligence in monitoring and maintaining a
tower antenna without raising a constitutional question,‖ but
―the same cannot be said of imposing liability for the speech
or expression of independent contractors.‖ Id. at 199. ―A
broadcast licensee,‖ we explained, ―should not be found
liable for violating the indecency provisions of [federal law]
without proof the licensee acted with scienter. Because the
Commission‘s proffered ‗non-delegable duty‘ theory of
CBS‘s vicarious liability, which functionally equates to strict
liability for speech or expression of independent contractors,
appears to dispense with this constitutional requirement,‖ we
concluded it could ―not be sustained.‖ Id. at 203.
―As an alternative to vicarious liability, the FCC found
CBS directly liable for a forfeiture penalty . . . for failing to
take adequate precautionary measures to prevent potential
indecency during the Halftime Show.‖ Id. According to the
FCC, the touchstone under this theory was whether CBS had
―acted willfully.‖ Reconsideration Order, 21 FCC Rcd. at
6655, ¶ 5. The FCC did ―not dispute‖ that CBS ―neither
planned Jackson and Timberlake‘s offensive actions nor knew
of the performers‘ intent to incorporate those actions into
their performance.‖ CBS, 535 F.3d at 189. But the FCC
believed CBS had satisfied the ―willfulness‖ requirement
based on the agency‘s finding that ―CBS was acutely aware
of the risk of unscripted indecent material‖ in the Halftime
Show, but had nonetheless ―consciously and deliberately
failed to take reasonable precautions to ensure that no
actionably indecent material was broadcast.‖
Reconsideration Order, 21 FCC Rcd. at 6660, ¶ 17.
Without ruling on whether this third theory might
ultimately sustain a finding of liability on the facts of this
18
case, we found certain key aspects of the FCC‘s reasoning
―unclear.‖ CBS, 535 F.3d at 189. First, we had doubts about
whether the agency had ―properly applied the forfeiture
statute.‖ Id. at 203; see 47 U.S.C. § 503(b)(1). Under 47
U.S.C. § 503(b)(1)(B), the FCC has authority to order
forfeiture penalties upon determining that a person ―willfully
or repeatedly failed to comply with any of the provisions of
this chapter or of any rule, regulation, or order issued by the
Commission under this chapter.‖ Another statutory
subsection, § 503(b)(1)(D), authorizes forfeitures for
violations of several specific statutory provisions, including
the indecency statute, 18 U.S.C. § 1464. See 47 U.S.C. §
503(b)(1)(D). Although the FCC‘s orders sometimes
specifically invoked § 503(b)(1)(B), see, e.g., Forfeiture
Order, 21 FCC Rcd. at 2778, ¶ 36, and its ―willfulness‖
standard appears to represent the agency‘s interpretation of
that subsection‘s express mens rea element, the orders
referred in other places to § 503(b) or § 503(b)(1) only
generally, without specifying the applicable subsection, see,
e.g., Forfeiture Order, 21 FCC Rcd. at 2760, ¶ 1 n.1;
Reconsideration Order, 21 FCC Rcd. at 6655, ¶ 5. Given that
§ 503(b)(1)(D) expressly authorizes forfeitures for indecency
violations, we questioned ―whether the statutory scheme
permits violations of 18 U.S.C. § 1464 to be penalized by
forfeitures issued under section 503(b)(1)(B) instead of, or in
addition to, section 503(b)(1)(D).‖ CBS, 535 F.3d at 205.
As noted, our previous opinion determined that ―a
showing of scienter is constitutionally required to penalize
broadcast indecency.‖ Id. Although § 503(b)(1)(B)
contained an express mens rea standard, i.e. willfulness, and
§ 503(b)(1)(D) did not, we believed both provisions must be
interpreted to ―set a bar‖ to liability ―at least as high as
19
scienter.‖ Id. A key question, then, was what level of
scienter was necessary to sustain a penalty for indecent
expression. ―Where a scienter element is read into statutory
text,‖ we observed, ―scienter would not necessarily equate to
a requirement of actual knowledge or specific intent.‖ Id. at
206. Instead, ―[t]he presumption in favor of scienter requires
a court to read into a statute only that mens rea which is
necessary to separate wrongful conduct from otherwise
innocent conduct.‖ Id. (quoting Carter v. United States, 530
U.S. 255, 269 (2000)). Applying this principle, we surmised
that recklessness was a sufficiently culpable mental state for
purposes of 18 U.S.C. § 1464. ―It is likely,‖ we explained,
―that a recklessness standard would effectively separate
wrongful conduct from otherwise innocent conduct of
broadcasters without creating an end-around indecency
restrictions that might be encouraged by an actual knowledge
or intent standard.‖ Id. (internal quotation marks and citation
omitted). Moreover, we noted that recklessness had been
found to be an adequate scienter standard in other contexts,
including First Amendment contexts. Id. at 206–07.
The parties here had disputed whether CBS took
adequate precautions with regard to the risk of indecency in
the Halftime Show. The parties disagreed about whether
certain events leading up to the broadcast—including public
comments by Jackson‘s choreographer that the performance
would include ―some shocking moments‖— indicated a high
risk of indecent material. Another point of contention
involved the role of video delay technology. Although CBS
utilized a five-second audio delay, it did not delay its video
broadcast. We found ―[b]ecause the Commission carries the
burden of showing scienter, it should have presented evidence
to demonstrate, at a minimum, that CBS acted recklessly and
20
not merely negligently when it failed to implement a video
delay mechanism for the Halftime Show broadcast.‖ Id. at
208. Because we found the ―record at present‖ was wanting
in this regard, we were ―unable to decide whether the
Commission‘s determination that CBS acted ‗willfully‘ was
proper in light of the scienter [i.e., recklessness]
requirement.‖ Id.Having determined the FCC‘s enforcement actions
here were arbitrary and capricious, our previous decision
vacated the forfeiture orders and remanded. Although we
recognized the FCC could ―not retroactively penalize CBS‖
for material that was not indecent under FCC policy at the
time of broadcast, we explained the agency could still enter a
declaratory order on remand, ―set[ting] forth a new policy and
proceed[ing] with its indecency determination even though a
retroactive monetary forfeiture [would be] unavailable.‖ Id.
at 209. The remand also afforded the agency an opportunity
to address the constitutionally required scienter element of the
indecency standard.
C.
While the FCC‘s petition for certiorari in this case was
pending, the Supreme Court decided Fox. As noted, Fox
reviewed the Second Circuit‘s decision invalidating monetary
forfeitures issued against Fox and its affiliates for several
unscripted expletives broadcast live during two different
Billboard Music Awards ceremonies.6 The FCC‘s forfeiture
6
The first incident occurred during the 2002 Awards, ―when
the singer Cher exclaimed, ‗I‘ve also had critics for the last
40 years saying that I was on my way out every year. Right.
So f* * * ‗em.‘‖ Fox, 129 S. Ct. at 1808. The second took
21
orders for fleeting expletives in Fox, unlike its orders
penalizing a fleeting image here, ―forthrightly acknowledged
that [they were breaking] new ground.‖ Fox, 129 S. Ct. at
1812. Nonetheless, the Second Circuit had found the
agency‘s explanation for its policy change inadequate. In
reviewing this determination, the Supreme Court gave its own
account of the FCC‘s enforcement history.
The Court‘s chronicle, like ours, began with Pacifica‘s
sanction of George Carlin‘s ―Dirty Words‖ routine. Id. at
1806. The Court explained that ―[i]n the ensuing years, the
Commission took a cautious, but gradually expanding,
approach to enforcing the statutory prohibition against
indecent broadcasts.‖ Id. Like our previous opinion, Fox
noted the FCC decided in 1987 that its enforcement power
was not limited to ―the seven words actually contained in the
George Carlin monologue.‖ Id. at 1807 (quoting In re
Pacifica Found., Inc., 2 FCC Rcd. 2698, 2699, ¶ 12 (1987)).
But the Court in Fox observed something in the 1987
decisions that we had not mentioned: it found the FCC
opinions expanding the scope of the agency‘s enforcement
also
preserved a distinction between literal and
nonliteral (or ‗expletive‘) uses of evocative
language. The Commission explained that each
literal ―description or depiction of sexual or
excretory functions must be examined in
context to determine whether it is patently
place during the 2003 Awards, when Nicole Richie
―proceeded to ask the audience, ‗Why do they even call it
‗The Simple Life‘? Have you ever tried to get cow s* * * out
of a Prada purse? It‘s not so f* * *ing simple.‘‖ Id.22
offensive,‖ but that ―deliberate and repetitive
use . . . is a requisite to a finding of indecency‖
when a complaint focuses solely on the use of
nonliteral expletives.
Id. (quoting Pacifica Found., 2 FCC Rcd. at 2699, ¶ 13)
(alteration in original) (citation omitted).
The Court in Fox found the Golden Globes decision
was ―the first time‖ the FCC declared ―that a nonliteral
(expletive) use of the F- and S-words could be actionably
indecent, even when the word is used only once.‖ Id.Because the broadcasts at issue in Fox had occurred prior to
the Golden Globes order, the FCC had ―declined to assess
penalties.‖ Id. at 1812. Accordingly, the indecency
determinations in Fox did not pose a notice or due process
problem, and the Court‘s majority opinion limited itself
exclusively to the question of whether the FCC‘s explanation
for holding fleeting or isolated expletives indecent—which
largely echoed the justification proffered in Golden Globes—
passed muster under the APA.
The Court answered that question in the affirmative.
The Court rejected the principle (espoused by the Second
Circuit) that ―agency action that changes prior policy‖
requires ―a more substantial explanation‖ than does action in
an area previously untouched. Id. at 1810. Although ―[a]n
agency may not . . . depart from a prior policy sub silentio or
simply disregard rules that are still on the books . . . it need
not demonstrate to a court‘s satisfaction that the reasons for
the new policy are better than the reasons for the old one.‖
Id. at 1811. Accordingly, the Court concluded an ―agency
need not always provide a more detailed justification than
what would suffice for a new policy created on a blank slate.‖
23
Id.Judged under this clarified standard, the FCC orders at
issue in Fox were not arbitrary and capricious. Id. at 1812–
19. The FCC acknowledged its change in policy, and the
Court found its reasons for including fleeting expletives
within the scope of actionable indecency to be ―entirely
rational.‖ Id. at 1812. In making this determination, the
Court compared the FCC‘s policy toward fleeting expletives
with its treatment of other offensive material. ―It was
certainly reasonable,‖ the Court believed, for the agency ―to
determine that it made no sense to distinguish between literal
and nonliteral uses of offensive words, requiring repetitive
use to render only the latter indecent.‖ Id. The per se
exemption for fleeting expletives, the Court explained, had
been an anomaly:
When confronting other requests for per se
rules governing its enforcement of the
indecency prohibition, the Commission ha[d]
declined to create safe harbors for particular
types of broadcasts. The Commission could
rationally decide it needed to step away from its
old regime where nonrepetitive use of an
expletive was per se nonactionable because that
was at odds with the Commission‘s overall
enforcement policy.
Id. at 1813 (internal citations and quotation marks omitted).
Because ―[e]ven isolated utterances can be made in
pand[ering,] . . . vulgar and shocking manners,‖ the Court
found it rational for the FCC to cease providing ―a safe harbor
for single words‖ and subject them instead to the agency‘s
general ―context-based‖ test for ―patent offensiveness.‖ Id. at
24
1812–13 (internal quotation marks omitted) (second alteration
and omission in original).
II.
According to the FCC, Fox stands for the proposition
that the safe harbor had extended only to isolated expletives,
i.e. non-literal language, and not, as we had originally
concluded, to all fleeting material. The FCC points to Fox‘s
statement that FCC policy historically subjected
―description[s] or depiction[s]‖ of sexual organs or functions
to a contextual standard, reserving a safe harbor only for
―nonliteral expletives.‖ Id. at 1807 (quoting Pacifica Found.,
2 FCC Rcd. at 2699, ¶ 13). Because images are ―depictions,‖
the FCC argues, Fox tells us that images were not entitled to a
safe harbor.
CBS, by contrast, denies that anything in Fox
undermines our previous conclusion that the FCC‘s forfeiture
orders represented a change in policy. ―Fox,‖ CBS argues,
―does not involve allegedly indecent images, and focuses
solely on words uttered.‖ CBS Letter-Brief 6 (Jan. 29, 2010).
In CBS‘s view, Fox‘s discussion of the 1987 FCC opinion
Pacifica Foundation is ―utterly irrelevant‖ to the issue before
us. Id. at 1. In its view, Fox‘s identification of a distinction
between the treatment of literal utterances and nonliteral
expletives is merely background information incidental to the
Supreme Court‘s holding and therefore dicta. The FCC, on
the other hand, argues the Court‘s description of the FCC‘s
historic enforcement policy is integral to its holding that the
FCC orders in Fox complied with the APA.
I believe Fox‘s distinction between the FCC‘s historic
treatment of different kinds of fleeting material undermines a
25
key premise of our earlier opinion. Our opinion did not rest
on an explicit statement by the FCC that fleeting images
would be per se exempt from indecency regulation. Instead,
we identified FCC decisions that had held certain isolated
words immune from the enforcement regime. See, e.g., CBS,
535 F.3d at 176 (quoting WGBH, 69 F.C.C. 2d at 1254, ¶ 10
n.6). In addition, after reviewing the entirety of the agency‘s
enforcement history up until the Halftime Show, we found
―the FCC had never varied its approach to indecency
regulation based on the format of broadcasted content.‖ Id. at
184. Accordingly, we concluded the FCC‘s enforcement
policy had contained a blanket rule exempting all fleeting
material, without qualification, from the indecency standard.
In Fox, however, the Supreme Court states that FCC
policy did, in fact, make distinctions ―based on the format of
broadcasted content.‖ As the Court interpreted the FCC‘s
pre-Golden Globes enforcement history, ―literal
‗description[s] or depiction[s] of sexual or excretory
functions‘‖ were subject to a multi-factor test and could
potentially be found indecent notwithstanding their fleeting or
nonrepetitive character, Fox, 129 S. Ct. at 1807 (quoting
Pacifica Found., 2 FCC Rcd. at 2699, ¶ 13); the safe harbor
for fleetingness encompassed only the ―use of nonliteral
expletives,‖ id. ―Although the Commission had expanded its
enforcement beyond the ‗repetitive use of specific words or
phrases,‘ it preserved a distinction between literal and
nonliteral (or ‗expletive‘) uses of evocative language.‖ See
id. at 1807. Fox therefore contradicts and undermines our
previous holding that FCC enforcement policy embodied a
general exemption for all fleeting material.7 Moreover, Fox
7
I acknowledge that the allegedly indecent material at issue
in Fox involved only words, and that Fox‘s discussion of the
26
describes the narrow safe harbor for fleeting ―nonliteral
expletives‖ or ―evocative language‖ as a deviation from the
default rule of contextual analysis. The per se exemption,
Fox explains, was ―at odds with the Commission‘s overall
enforcement policy.‖ Id. at 1813. ―When confronting other
requests for per se rules governing its enforcement of the
indecency prohibition, the Commission ha[d] declined to
create safe harbors for particular types of broadcasts.‖ Id.In other words, Fox identifies contextual analysis as
the default policy for all broadcast content, with the narrow
exception of nonliteral expletives. Although my colleagues
emphasize the omission of any specific discussion of images
in Fox, our earlier opinion‘s finding of a safe harbor for
fleeting images was premised on a per se exemption for
fleeting content generally. As Fox portrays the FCC‘s
enforcement history, however, no such general policy existed.
Instead, the Court concluded that the safe harbor for fleeting
nonliteral expletives was an isolated exception rather than an
instance of a more general rule. It reasoned that the removal
FCC enforcement policy is not on its face addressed to the
agency‘s treatment of images. But the Court‘s account of
FCC enforcement policy and history limits the fleeting
exemption solely to nonliteral use of ―evocative language.‖
See id. at 1807. The Court noted that the FCC had rejected
other types of exemptions. See id. at 1813 (―When
confronting other requests for per se rules governing its
enforcement of the indecency prohibition, the Commission
has declined to create safe harbors for particular types of
broadcasts.‖). The structure of the Court‘s discussion
conveys that the Court viewed the exception for nonliteral
expletive language as an exception at odds with the FCC‘s
treatment of all other material, including images.
27
of this exception allowed the FCC to bring treatment of
fleeting indecent language into harmony with its overall
enforcement policy. Fox, 129 S. Ct. at 1813. The existence
of a similar safe harbor for fleeting images would have
undermined this key holding of Fox. The Court‘s omission of
any discussion of fleeting images strongly suggests that,
rather than constituting a per se exception, such instances fell
within the contextual approach that the Court identified as the
―Commission‘s prior enforcement practice.‖ Fox, 129 S. Ct.
at 1814. It follows that the FCC‘s decision to apply a
contextual analysis to the fleeting image in this case did not
represent a change in policy.
The Court‘s holding expressly relied on the
distinctions it identified in the FCC‘s historic treatment of
different types of fleeting content. In concluding the
agency‘s reasons for eliminating a safe harbor for fleeting
―nonliteral expletives‖ were ―entirely rational,‖ the Court
explained that ―[i]t was certainly reasonable to determine that
it made no sense to distinguish between literal and nonliteral
uses of offensive words, requiring repetitive use to render
only the latter indecent.‖ Id. at 1812. The very fact that the
safe harbor for fleeting expletives was an isolated exception
to the FCC‘s general contextual standard was itself, the Court
said, a defensible reason for the policy change announced in
Golden Globes and Fox: ―The Commission could rationally
decide it needed to step away from its old regime where
nonrepetitive use of an expletive was per se nonactionable
because that was at odds with the Commission‘s overall
enforcement policy.‖ Id. at 1813 (internal quotation marks
omitted).
As this examination of Fox makes clear, the Supreme
Court‘s account of the FCC‘s pre-Golden Globes enforcement
28
policy is not characterization, but central to Fox‘s holding.
Given that account, I would hold that the FCC‘s indecency
determination in this case did not constitute a change of
policy—unacknowledged or otherwise—and was not
arbitrary and capricious under the APA.8
8
Our previous opinion identified several FCC decisions in
which the FCC had found that certain fleeting images did not
violate the indecency standard. See CBS, 535 F.3d at 184–86.
We believed these decisions supported our conclusion that
FCC policy had afforded a safe harbor to all fleeting material.
In none of these cases, however, did the FCC state that
fleeting images were per se nonactionable. In light of Fox, I
believe that these decisions are also compatible with a
contextual standard. Precisely because the reasoning in many
of these opinions is sparse, they may be read as holding not
that the fleeting quality of the images was per se dispositive
but rather that, in the particular context presented, the image‘s
transience outweighed any countervailing factors.
CBS argues that even if fleeting material did not enjoy
a per se exemption under FCC policy, the agency applied its
contextual standard differently here that it had in earlier cases
where fleetingness proved dispositive. ―[P]atently
inconsistent applications of agency standards to similar
situations are by definition arbitrary.‖ South Shore Hosp.,
Inc. v. Thompson, 308 F.3d 91, 103 (1st Cir. 2002). But CBS
has not shown that the facts in this case are materially
indistinguishable from a case in which the agency found no
indecency. As we have recognized, ―an agency‘s
interpretation of its own precedent is entitled to deference.‖
CBS, 535 F.3d at 180 (quoting Cassell v. FCC, 154 F.3d 478,
483 (D.C. Cir. 1998)). Given the nature of the FCC‘s
contextual standard, each case is likely to present a unique
29
In our earlier opinion, we determined that if the policy
change set forth in Golden Globes and Fox addressed only
fleeting expletives, as the FCC has asserted, then it left in
place a safe harbor for all other fleeting content. CBS, 535
F.3d at 181. Fox held precisely the opposite—that in
eliminating a safe harbor for fleeting expletives in Golden
Globes and Fox, the FCC made a reasonable decision to
abolish an anomalous exception and establish a uniform
contextual test for all allegedly indecent material. The
rationale of the FCC decision suggested by our earlier
opinion—to eliminate a safe harbor for presumptively less
offensive fleeting expletives while maintaining a per se
exemption for fleeting literal utterances and potentially
graphic images—would appear more dubious. In short, our
earlier opinion is irreconcilable with the reasoning by which
the Supreme Court upheld the FCC orders in Fox.
CBS argues that even if the indecency determination
here did not constitute a change of policy, the forfeiture
penalty must be invalidated because CBS was not sufficiently
―on notice‖ of its potential liability for fleeting images.
―Because due process requires that parties receive fair notice
before being deprived of property. . . in the absence of
notice—for example, where the regulation is not sufficiently
clear to warn a party about what is expected of it—an agency
may not deprive a party of property by imposing civil or
criminal liability.‖ Trinity Broad. of Fla., Inc. v. FCC, 211
balance of factors, and I cannot say that the FCC acted
unreasonably in determining that the fleetingness of the
image here was outweighed by its graphic and pandering
qualities.
30
F.3d 618, 628 (D.C. Cir. 2000) (internal quotation marks and
alterations omitted). Referring to the 1987 FCC decision
quoted by Fox, CBS submits that ―no fine [in this case] can
be justified based on a cryptic reference in dictum that was
never discussed or applied for over two decades.‖ CBS
Letter-Brief at 18.
CBS‘s argument implicitly assumes that the 1987
decision was the only indication by the FCC that fleeting
images were potentially actionable. But that is not the case.
At the very least, the FCC‘s opinion in Young Broadcasting,
which involved somewhat similar facts and was issued only
days before the Halftime Show, made clear that fleeting
images of nudity could be found indecent if presented in a
sufficiently explicit and pandering fashion. In issuing its
Notice of Apparent Liability in that case, the FCC explained
that ―although the actual exposure of the performer‘s penis
was fleeting in that it occurred for less than a second,‖ this
mitigating factor was outweighed by the explicitness and
pandering quality of the image‘s presentation. Young Broad.,
19 FCC Rcd. at 1754–55, ¶¶ 10–12; see also id. (―In
particular cases, one or two of the factors may outweigh the
others, either rendering the broadcast material patently
offensive and consequently indecent, or, alternatively,
removing the broadcast material from the realm of
indecency.‖ (footnotes omitted)).9
9
It is true, as we noted in our previous opinion, that Young
Broadcasting ―makes no distinction, express or implied,
between words and images.‖ CBS, 535 F.3d at 186. The
FCC‘s opinion suggests that all fleeting content is subject to a
contextual standard and fails to acknowledge even the limited
safe harbor for fleeting expletives identified in Fox. See
31
In our earlier opinion, we acknowledged that Young
Broadcasting found a nude image indecent despite its
fleetingness, but we declined to give effect to the FCC‘s
decision because we believed it amounted to an
unacknowledged change in policy in contravention of the
APA. See CBS, 535 F.3d at 187 (describing Young as ―the
Commission‘s initial effort to abandon its restrained
enforcement policy on fleeting material‖). We held, in other
words, that Young Broadcasting could not have validly
changed the FCC‘s policy with regard to fleeting material and
could not therefore have relieved the FCC of the obligation to
acknowledge and explain its new policy. As noted, however,
I would revisit and revise our APA conclusion on the basis of
Fox and no longer find that FCC policy historically
Young Broad., 19 FCC Rcd. at 1754–55, ¶¶ 10, 12 n.35; see
also Industry Guidance 16 FCC Rcd. at 8003, ¶ 10 (stating,
without any mention of a per se exemption for fleeting
expletives, that under the FCC‘s analytical framework, ―[n]o
single factor generally provides the basis for an indecency
finding‖). That Young Broadcasting overstated the historic
scope of liability, however, does not preclude that case from
furnishing adequate notice of broadcast licensees‘ potential
liability for fleeting images; if anything, this error served to
underscore the risk of liability. The FCC‘s forfeiture order
here reflected the FCC‘s understanding that all fleeting
material would be subject to a contextual standard. See
Forfeiture Order, 21 FCC Rcd. at 2766, ¶12 (concluding that
―even though we find that the partial nudity [broadcast at the
end of the Halftime Show] was fleeting, the brevity of the
partial nudity is outweighed by the first and third factors of
our contextual analysis‖).
32
immunized fleeting material from regulation.10 The finding
of indecency for the fleeting imagery in Young Broadcasting
put CBS on notice that FCC policy did not afford fleeting
images an automatic exemption from indecency regulation.
My colleagues offer an alternate interpretation of
Young Broadcasting as an application of ―an exception within
the [per se] exception.‖11 Majority op. at 26. They also
believe that Young Broadcasting could not provide CBS with
notice because it was a non-final notice of apparent liability.
Id. at 19. Both interpretations are inapposite. The most
straightforward reading of Young Broadcasting reveals the
FCC applying a contextual standard rather than a set of nested
exceptions, weighing all three factors with no one being
determinative.12 Moreover, despite my colleagues‘ emphasis
10
I will not address CBS‘s constitutional challenge to the
indecency standard. See infra Section IV.
11
It bears noting that the FCC in this case made the same
finding as in Young Broadcasting that ―the material was
apparently intended to pander to, titillate and shock viewers.‖
Forfeiture Order, 21 FCC Rcd. at 2763, ¶ 3, 2766-67, ¶13,.
If there is indeed an ―exception within the exception‖ for
titillating and shocking content, it would appear to apply in
this instance as well.
12
My colleagues argue that the FCC recognized an exemption
in Young Broadcasting because it cited prior FCC decisions
concluding that the fleetingness of an image tended to weigh
in favor of a finding of no liability. Majority op. at 26. But
the FCC discussed fleetingness in Young Broadcasting in the
context of the three-factor contextual standard. See Young
Broad., 17 FCC Rcd. at 1755 (―In particular cases, one or two
of the factors may outweigh the others, either rendering the
broadcast material patently offensive and consequently
33
on notice, this standard was not a new departure for the FCC.
Young Broadcasting‘s use of a contextual standard is
consistent with the FCC‘s 2001 Industry Guidance and the
Court‘s account of FCC enforcement in Fox. The case‘s
unexceptional application of an established legal standard was
sufficient to alert CBS to the possibility that fleeting images
might be deemed indecent.
Following Fox, I cannot say that the FCC changed its
policy by applying its contextual, three-factor standard to a
fleeting image. Therefore I cannot join the majority‘s holding
that the forfeiture orders were arbitrary and capricious under
the APA. Under Young Broadcasting, it was apparent before
the Halftime Show that fleeting images could, depending on
the context, be deemed indecent. For this reason, CBS was
adequately on notice of the policy the FCC applied in this
case.
III.
Whether Jackson and Timberlake‘s performance was
indecent is a distinct question from whether CBS can be held
liable for the live broadcast of that performance. Because I
would uphold the FCC‘s orders under the APA, the latter
question, which we examined in our prior ruling, has
heightened importance.
A.
indecent, or, alternatively, removing the broadcast material
from the realm of indecency. In this case, we examine all
three factors. . . .‖ (footnote omitted)). It did not state there
was a per se exception for all fleeting images.
34
CBS challenges the ability of Congress or the FCC to
regulate any indecency on broadcast television within the
bounds of the First Amendment. It contends technological
change has undercut the traditional rationale for providing
lesser protection to broadcasting in relation to other modes of
speech. In Pacifica, the plurality noted the scarcity of
available frequencies and the need for licensing has always
subjected broadcasters‘ speech to greater regulation—
including restrictions on speech that is indecent but not
obscene. See Pacifica, 438 U.S. at 748 (―[I]t is broadcasting
that has received the most limited First Amendment
protection. Thus, although other speakers cannot be licensed
except under laws that carefully define and narrow official
discretion, a broadcaster may be deprived of [its] license and
[its] forum if the Commission decides that such an action
would serve ‗the public interest, convenience, and
necessity.‘‖). Pacifica noted that broadcast television is
uniquely pervasive in American life and uniquely accessible
to children. Id. at 748-50. Given the array of media currently
available, CBS argues broadcast television no longer inhabits
the unique and ubiquitous role in American society that the
Court found made it deserving of lesser First Amendment
protection. Notwithstanding this criticism, the Supreme
Court has given no hint it views subsequent technological
changes as undermining Pacifica‘s rationale that the unique
characteristics of this medium allows Congress to regulate
indecent speech on broadcast television.
B.
After oral argument on remand, we requested
supplemental briefing on the proper standard of scienter. The
FCC no longer presses theories of vicarious liability and non-
delegable duty we rejected in our prior decision. Nor does it
35
appear to contest our prior judgment that CBS can be held
liable only if it acted recklessly in broadcasting the offending
image. Accordingly, the FCC requests a remand so that it
may determine whether CBS acted with the required mens
rea. CBS disputes the FCC‘s characterization of the scienter
threshold and contends there is no factual basis for a
forfeiture penalty.
Congress has authorized the FCC to impose monetary
forfeitures in several circumstances. See 47 U.S.C. §
503(b)(1). Two provisions are relevant here. Section
503(b)(1)(B) permits a penalty for ―willfully or repeatedly
fail[ing] to comply with any of the provisions of this chapter
or of any rule, regulation, or order issued by the Commission
under this chapter,‖ and § 503(b)(1)(D) authorizes a forfeiture
for ―violat[ing] any provision of section . . . 1464 . . . of Title
18.‖ 47 U.S.C. § 503(b)(1)(B), (D). Although the FCC
referenced § 503(b)(1)(D), its forfeiture orders in this case
appear to rest solely on the authority of § 503(b)(1)(B). See,
e.g., Forfeiture Order, 21 FCC Rcd. at 2776, ¶ 29 n.103
(explaining that because the FCC had found CBS liable under
§ 503(b)(1)(B), there was no need to ―address whether [CBS]
could also be held responsible under Section 503(b)(1)(D)‖).
Our previous opinion expressed skepticism about the
applicability of § 503(b)(1)(B) to indecency violations. CBS,
535 F.3d at 203-04. I would hold Congress intended the FCC
to proceed under § 503(b)(1)(D) when sanctioning indecency
violations. ―Ordinarily, where a specific provision conflicts
with a general one, the specific governs.‖ Edmond v. United
States, 520 U.S. 651, 657 (1997). Here, § 503(b)(1)(B)
speaks generally of violations of ―any of the provisions of this
chapter or of any rule, regulation, or order issued by the
Commission under this chapter.‖ Section 503(b)(1)(D), on
36
the other hand, refers specifically to having ―violated any
provision of section . . . 1464 . . . of Title 18.‖
The history of the forfeiture statute supports the view
that Congress intended § 503(b)(1)(D) as the vehicle to
impose forfeitures for airing indecent material. Both
forfeiture provisions were originally enacted as part of the
same set of amendments to the Communications Act. See
Communications Act Amendments, 1960, Pub. L. No. 86-
752, § 7, 74 Stat. 889, 894. At the time of enactment, §
503(b)(1)(B) could not have applied to indecency violations
because 18 U.S.C. § 1464 was the only provision of federal
law proscribing indecency; none of the ―provisions of th[e]
chapter‖ containing § 503(b)(1)(B), nor ―any rule, regulation,
or order issued by the Commission under th[at] chapter‖
addressed the subject of indecency. The FCC has argued that
47 C.F.R. § 73.3999, which was not promulgated until 1988,
brought the indecency standard within the scope of §
503(b)(1)(B). But § 73.3999, which is entitled ―Enforcement
of 18 U.S.C. § 1464,‖ merely establishes the hours of the day
when 18 U.S.C. § 1464 will be enforced. Given the statutory
history, I believe Congress intended violations of 18 U.S.C. §
1464 to be enforced under 47 U.S.C. § 503(b)(1)(D) and not §
503(b)(1)(B). And since 47 C.F.R. § 73.3999 merely
enforces 18 U.S.C. § 1464‘s substantive standard, it did not
serve to bring indecency violations under the authority of §
503(b)(1)(B).
Even if § 503(b)(1)(B) were applicable to indecency
actions, I am skeptical that it would authorize a forfeiture in
this case. The provision requires a showing that a licensee
―willfully or repeatedly‖ violated a statutory or regulatory
standard. According to the statutory definition, ―the term
‗willful,‘ when used with reference to the commission or
37
omission of any act, means the conscious and deliberate
commission or omission of such act.‖ 47 U.S.C. § 312(f).
The FCC does not contend that CBS knew that Timberlake
would expose Jackson‘s breast, or intended that display to
occur. Instead, the FCC believes CBS‘s actions were
―willful‖ insofar as the network ―consciously and
deliberately‖ failed to take precautions despite the alleged
existence of a known or obvious risk that indecent material
would be broadcast. But since the act that must be ―willful‖
is, in this context, the violation of 18 U.S.C. § 1464, it would
appear that CBS cannot be held liable unless it ―consciously
and deliberately‖ broadcast the specific material deemed
indecent. The FCC argues the act can be either a commission
or omission—here (in the view of the FCC) the failure to take
necessary precautions. But even if an omission can support a
finding of a violation of § 503(b)(1)(B), the omission still
must be ―willful.‖ The reckless omission of ―precautions‖
would seem insufficient to satisfy the willfulness requirement
of § 503(b)(1)(B).
Although I would find the FCC‘s orders relied on
inapposite statutory authority, I do not believe this error
precludes the FCC from applying § 503(b)(1)(D) on remand.
See WorldCom, Inc. v. FCC, 288 F.3d 429, 430 (D.C. Cir.
2002) (remanding rulemaking where the FCC had relied on
an inapposite statutory provision ―[b]ecause there may well
be other legal bases for adopting the rules chosen by the
Commission‖); see also Castaneda-Castillo v. Gonzales, 488
F.3d 17, 25 (1st Cir. 2007) (―If the agency decision is flawed
by mistaken legal premises, . . . remanding to give the agency
an opportunity to cure the error is the ordinary course.‖
(emphasis omitted)); cf. SEC v. Chenery Corp., 332 U.S. 194,
200-01 (1947) (―The fact that the [agency] had committed a
38
legal error in its first disposition of the case certainly gave
[the prejudiced party] no vested right to receive the benefits
of such an order.‖).
The Supreme Court has directed as a general matter:
If the record before the agency does not
support the agency action, if the agency has not
considered all relevant factors, or if the
reviewing court simply cannot evaluate the
challenged agency action on the basis of the
record before it, the proper course, except in
rare circumstances, is to remand to the agency
for additional investigation or explanation.
Florida Power & Light Co. v. Lorion, 470 U.S. 729, 744
(1985). There have been few instances where courts have
found ―rare circumstances.‖ One such circumstance is ―when
there has been a strong showing in support of a claim of bad
faith or improper behavior on the part of agency
decisionmakers or where the absence of formal administrative
findings makes such investigation necessary in order to
determine the reasons for the agency's choice.‖ Sierra Club
v. Peterson, 185 F.3d 349, 369 (5th Cir. 1999) (quoting Nat‟l
Audubon Soc‟y v. Hoffman, 132 F.3d 7, 14 (2d Cir. 1997)).
Of course, remand is not required where a proper application
of the correct standard could yield only one possible result.
See George Hyman Constr. Co. v. Brooks, 963 F.2d 1532,
1539 (D.C. Cir. 1992) (―[W]e find that a remand would be
futile on certain matters as only one disposition is possible as
a matter of law.‖). But where ―the answer the [agency] might
give were it to bring to bear on the facts the proper
administrative and statutory considerations‖ is ―[s]till
unsettled,‖ remand is the proper course. Chenery, 332 U.S. at
39
200. As I believe, following Fox, the FCC did not act in an
arbitrary and capricious manner, whether CBS can be held
liable for its broadcast of the Halftime Show is still
unsettled.13 That is the case here; the ―function‖ of applying
the proper liability standard to the facts of this case ―belongs
exclusively to the Commission in the first instance.‖ Id.C.
1.
Section 503(b)(1)(D), unlike § 503(b)(1)(B), does not
contain an express scienter requirement. On remand, both
parties agree that scienter is a prerequisite of liability under §
503(b)(1)(D) and 18 U.S.C. § 1464, but they dispute what
mental state is required. The FCC contends that recklessness
suffices, while CBS insists it can be liable only if it had
knowledge the Halftime Show would contain indecent
material and it intended to violate the indecency standard.
In most criminal or civil actions for obscenity or
indecency, the element of scienter as to the broadcast‘s
content will not be in doubt as ―the defendant will necessarily
know the contents of his utterances.‖ United States v. Smith,
467 F.2d 1126, 1129 (7th Cir. 1972). Scienter will be an
issue in forfeitures under § 1464, where, as here, live,
unscripted events are broadcast. The broadcaster may not
have forewarning of a potentially-indecent unscripted or
13
Accordingly, I believe, as our prior opinion held, that even
if the FCC‘s forfeiture order were arbitrary and capricious,
the FCC could on remand issue a finding of indecency
without a civil forfeiture as it did in Golden Globes. CBS,
535 F.3d at 209.
40
spontaneous event. Nor might the conduct of a third-party or
independent contractor necessarily be imputed to the
broadcaster. Live broadcasts, as opposed to scripted or
―taped‖ programming, will always carry the possibility or risk
of transmitting indecent material.
Against this backdrop, I believe recklessness is the
constitutional minimum standard for scienter when imposing
forfeiture penalties. ―The presumption in favor of scienter
requires a court to read into a statute only that mens rea
which is necessary to separate wrongful conduct from
otherwise innocent conduct.‖ Carter v. United States, 530
U.S. 255, 269 (2000) (internal quotation marks omitted).
Recklessness provides sufficient protection under the First
Amendment to speech in similar contexts. See New York
Times Co. v. Sullivan, 376 U.S. 254, 280 (1964) (allowing the
imposition of liability upon a showing that the defendant
published a statement with ―reckless disregard‖ of the risk it
was false); see also CBS, 535 F.3d at 206–07 (citing Osborne
v. Ohio, 495 U.S. 103 (1990)) (―Also instructive here are
other cases determining recklessness to be an adequate level
of scienter for imposing liability in related First Amendment
contexts where speech or expression is restricted based on its
content.‖).14
Imposing a higher scienter standard than recklessness,
such as the actual knowledge or intent standard urged by
CBS, dilutes the duty imposed by Congress in 18 U.S.C. §
14At common law, the concept of recklessness could be
expressed in a variety of ways. Historically, terms such as
malicious or wanton ―were used interchangeably with
recklessness.‖ David M. Treiman, Recklessness and the
Model Penal Code, 9 Am. J. Crim. L. 281, 293 (1981).
41
1464 and risks creating an end-around indecency
restrictions.15 Such a standard could permit ―willful
15
CBS also argues that the FCC must show it specifically
intended to violate the indecency prohibition in § 1464. CBS
relies on pre-Pacifica case law addressing prosecutions for
scripted broadcasts of obscene or indecent material. See
United States v. Smith, 467 F.2d 1126 (7th Cir. 1972);
Tallman v. United States, 465 F.2d 282 (7th Cir. 1972);
Gagliardo v. United States, 366 F.2d 720 (9th Cir. 1966).
These cases have limited value as they address criminal
prosecutions for scripted content. See Pacifica, 438 U.S. at747 n.25 (Stevens, J., plurality op.) (differentiating precedents
addressing criminal prosecutions and the First Amendment by
noting ―[e]ven the strongest civil penalty at the Commission‘s
command does not include criminal prosecution‖).
Furthermore, Pacifica did not require the FCC show specific
intent for the civil forfeiture at issue there nor did the Court
cite to any of the cases on which CBS relies.
Even under the pre-Pacifica cases, this ―specific
intent‖ requirement of § 1464 is satisfied if one should have
known the utterance or broadcasting of such speech would
violate the law. In Tallman v. United States, upon which
CBS relies, the Seventh Circuit in interpreting § 1464
concluded that ―specific intent‖ is present under the standard
traditionally used at common law ―if the defendant knew or
reasonably should have known that uttering the words he did
over the air was a public wrong.‖ 465 F.2d at 288; see also
Smith, 467 F.2d at 1130 n.2 (citing Tallman for the
proposition ―an appropriate instruction as to specific intent
under this statute might be that ‗the defendant knew or
reasonably should have known that uttering the words he did
over the air was a public wrong‘‖). Even these pre-Pacifica
42
blindness‖ or allow broadcasters to fail to take reasonably
available precautions (such as implementing delay
technologies) despite any obvious risks, and then evade
responsibility if indecent material is broadcast, claiming they
neither intended nor were aware that the indecent material
would be broadcast. End runs might also be effected through
the use of independent contractors. Accordingly, I do not
believe liability for indecent broadcasts requires a showing of
actual knowledge, actual awareness, or intent on the part of
the broadcaster.16
2.
The question remains what is the proper standard of
recklessness under § 1464. As an alternative argument, CBS
precedents addressing criminal prosecutions recite an
―objective‖ or ―reasonable person‖ standard for scienter.
16
The cases cited by CBS in defense of its proposed mens rea
standard are inapposite, because in each case Congress had
already provided a scienter standard as to some elements of
the statutory offense. See Flores-Figueroa v. United States,
129 S. Ct. 1886 (2009); United States v. X-Citement Video,
Inc., 513 U.S. 64 (1994). In each of these cases, the statute in
question contained some mental state language, such as
―knowingly,‖ that when read naturally did not appear to
modify all the elements in the statute, see 18 U.S.C. §
1028A(a)(1); 18 U.S.C. § 2252. The Court only addressed
whether the express scienter term applied to every element of
the statutory offense or whether the term modified a single
element of the offense. These cases do not address what
mental state requirement should be read into provisions like
47 U.S.C. § 503(b)(1)(D) and 18 U.S.C. § 1464 that contain
no mens rea language whatsoever.
43
contends there is more than one possible definition of
recklessness, and the more demanding criminal standard
ought to apply here. As the Supreme Court has explained:
[t]he civil law generally calls a person reckless
who acts or (if the person has a duty to act) fails
to act in the face of an unjustifiably high risk of
harm that is either known or so obvious that it
should be known. The criminal law, however,
generally permits a finding of recklessness only
when a person disregards a risk of harm of
which he is aware.
Farmer, 511 U.S. at 836-37 (internal citations omitted); see
also Safeco Ins. Co. of Am. v. Burr, 551 U.S. 47, 68 n.18
(2007) (―Unlike civil recklessness, criminal recklessness also
requires subjective knowledge on the part of the offender.‖).
In my view, the FCC may on remand seek a civil
forfeiture under 47 U.S.C. § 503(b)(1)(D), but CBS‘s alleged
liability is predicated on its violation of 18 U.S.C. § 1464, a
criminal statute. For this reason, CBS contends the level of
scienter cannot vary based on whether the FCC pursues civil
remedies or the Department of Justice charges criminal
offenses. Notwithstanding the civil character of the forfeiture
action, CBS contends it can be held liable for a forfeiture
penalty only if it were criminally reckless—if it disregarded
an unjustifiably high risk of broadcast indecency of which it
was aware. Farmer, 511 U.S. at 836-37. The FCC counters
that in Pacifica the Supreme Court already interpreted the
standard for civil forfeitures for indecency violations
independent from § 1464‘s criminal applications, making
clear the civil recklessness standard applies.
44
I believe a civil standard best comports with
Congressional intent. In 1960, Congress expanded the civil
forfeiture provisions of the Federal Communications Act to
allow the FCC greater flexibility to regulate the broadcast
medium. Before the 1960 Act, the FCC‘s regulatory tools
were limited to revoking the broadcaster‘s license or asking
the Department of Justice to commence criminal
proceedings.17 Communication Act Amendments, 1960, H.R.
Rep. No. 86-1800, at 17. The FCC asked Congress to
―provide it with an effective tool in dealing with violations
where revocation or suspension does not appear to be
appropriate.‖ Id. The House Report explaining the
amendments indicated that to achieve the desired flexibility
the civil forfeiture provisions should be read as independent
from other enforcement provisions. The Report states ―the
FCC will not be precluded from ordering a forfeiture merely
because another type of sanction or penalty has been or may
be applied to the licensee or permittee.‖ Id.
The most telling argument in favor of a civil standard
is the Supreme Court‘s opinion in Pacifica. As noted by the
FCC, the plurality in Pacifica recognized that Congress
intended the civil provisions of the Communications Act to be
interpreted and applied apart from the criminal provisions.
The plurality stated in footnote 13:
The statutes authorizing civil penalties
incorporate § 1464, a criminal statute. See 47
17
Prior to 1960, § 503 only authorized forfeitures for
accepting rebates or offsets that deviated from the tariff rates
for the transmission of wire or radio messages. Federal
Communications Act of 1934, Pub. L. No. 73-416, § 503, 48
Stat. 1064, 1101 (1934).
45
U.S.C. §§ 312(a)(6), 312(b)(2), and
503(b)(1)(E) (1970 ed. and Supp. V). But the
validity of the civil sanctions is not linked to the
validity of the criminal penalty. The legislative
history of the provisions establishes their
independence. As enacted in 1927 and 1934,
the prohibition on indecent speech was separate
from the provisions imposing civil and criminal
penalties for violating the prohibition. Radio
Act of 1927, §§ 14, 29, and 33, 44 Stat. 1168and 1173; Communications Act of 1934, §§
312, 326, and 501, 48 Stat. 1086, 1091, and
1100, 47 U.S.C. §§ 312, 326, and 501 (1970 ed.
and Supp. V). The 1927 and 1934 Acts
indicated in the strongest possible language that
any invalid provision was separable from the
rest of the Act. Radio Act of 1927, § 38, 44
Stat. 1174; Communications Act of 1934, §
608, 48 Stat. 1105, 47 U.S.C. § 608. Although
the 1948 codification of the criminal laws and
the addition of new civil penalties changed the
statutory structure, no substantive change was
apparently intended. Cf. Tidewater Oil Co. v.
United States, 409 U.S. 151, 162. Accordingly,
we need not consider any question relating to
the possible application of § 1464 as a criminal
statute.
Pacifica, 438 U.S. at 739 n.13. Under Pacifica, the level of
scienter to prove a violation of § 1464 need not be the same
for both criminal and civil applications. Of course, the
respective penalties are different. Violation of 18 U.S.C. §
1464 carries a statutory maximum penalty of up to two years
46
imprisonment and a fine of up to $250,000 for individuals and
$500,000 for organizations. 18 U.S.C. §§ 1464, 3571(b)-(c).
At the time of the alleged violation,18 a forfeiture under 47
U.S.C. § 503(b)(1) carried a maximum forfeiture of §27,500
for each station. Reconsideration Order, 21 FCC Rcd. at
6654, ¶ 2. As the FCC found twenty stations aired the
indecent material in the Halftime Show, it imposed a
forfeiture on CBS of $550,000 (twenty violations at the
maximum $27,500 per violation). Id.
CBS relies on FCC v. American Broadcasting Co., 347
U.S. 284 (1954). In ABC, the FCC desired to ban ―give
away‖ contests where radio and television stations would
distribute prizes to listeners and viewers who called in and
correctly answered a question or solved a puzzle. 347 U.S. at
286-87. To this end, the FCC promulgated regulations
interpreting 18 U.S.C. § 1304, which prohibits broadcasting
―any advertisement of or information concerning any lottery,
gift enterprise, or similar scheme, offering prizes dependent
in whole or in part upon lot or chance.‖ Id. at 285. The FCC
defined games of chance to include ―give away‖ contests. Id.
at 286. Prior to adopting the regulation, the FCC had failed to
persuade the Department of Justice to pursue criminal actions
against such programs and had urged Congress
unsuccessfully to amend the law. Id. at 296. Additionally,
the Post Office, which administered a similar statute
involving the mails, and the Department of Justice had
18
In 2006, Congress added 47 U.S.C. § 503(b)(2)(C) which
raised maximum penalties for those found ―to have broadcast
obscene, indecent, or profane language‖ to $325,000 per
violation, not to exceed an aggregate of $3 million for any
single act of failure to act. Broadcast Decency Enforcement
Act of 2005, Pub. L. No. 109-235, 120 Stat. 491, 491 (2006).
47
interpreted the same statutory language to exclude the type of
program the FCC wished to regulate. Id. at 294. The Court
concluded ―[t]here cannot be one construction for the Federal
Communications Commission and another for the
Department of Justice.‖ Id. at 296; see also Leocal v.
Ashcroft, 543 U.S. 1, 11-12 n.8 (2004); United States v.
Thompson/Center Arms Co., 504 U.S. 505, 506-07 (1992)
(plurality).19 CBS contends we must construe § 1464 in the
exact same manner as if this were a criminal prosecution.20
There is some merit in CBS‘s position that, as a
general matter, a statute should be read consistently in its
criminal and civil applications. But in ABC (and also Leocal
and Thompson), the Court construed the literal text of a
statute, finding no good reason to apply different
19
In Leocal v. Ashcroft, 543 U.S. 1 (2004), when interpreting
the definition of ―crime of violence‖ contained in 18 U.S.C. §
16 as applied to a civil deportation proceeding, the Court
noted that if the definition were ambiguous it would apply the
rule of lenity used in criminal proceedings because the statute
―has both criminal and noncriminal applications.‖ Id. at 12
n.8. Similarly, in United States v. Thompson/Center Arms
Co., the Court had to define when a firearm was ―made‖ to
determine if a tax on the ―making‖ was owed to the
government. 504 U.S. 505, 506-07 (1992) (plurality). To
resolve the issue, the Court applied the rule of lenity because
―although it is a tax statute that we construe now in a civil
setting, the [statute] has criminal applications.‖ Id. at 517;
see also id. at 523 (Scalia, J., concurring in judgment).
20
Justice Stewart‘s dissent raised the argument CBS raises
here that the statute must be read in keeping with ABC,
Pacifica, 438 U.S. at 780 n.8 (Stewart, J., dissenting), a
proposition the plurality rejected in footnote 13.
48
constructions for civil actions and criminal prosecutions. In
this case, there is no text to interpret. The statutes (18 U.S.C
§ 1464 and 47 U.S.C. § 503(b)(1)(D)) are silent on scienter;
as a consequence, we must apply the constitutionally required
level of scienter. Furthermore, ―[i]f [Congress‘s] intent is
made plain, it is unnecessary for us to refer to other canons of
statutory construction, and indeed we should not do so.‖ In re
Am. Home Mortg. Holdings, Inc., 637 F.3d 246, 254-55 (3d
Cir. 2011). As I have noted, the Supreme Court in Pacifica
concluded Congress intended the specific provision at issue to
be interpreted for civil forfeitures without regard to its
application in criminal prosecutions. Pacifica, 438 U.S. at739 n.13. Accordingly, I would read into the statute only the
scienter necessary in this context for a civil forfeiture order—
the objective standard of civil recklessness.
3.
If we were to reject, as I think we should, CBS‘s
arguments under the APA, at issue would be whether the
standard of recklessness for a civil forfeiture under
§503(b)(1)(D) is subjective (knowledge or awareness of an
unjustifiably high risk of harm) or objective (should have
been aware of such a risk). I believe an objective standard for
recklessness is sufficient to separate wrongful from otherwise
innocent conduct.21 Adoption of a subjective standard,
21
In practice the distinction between a subjective or an
objective standard may not always result in differences on
liability. The law has traditionally allowed the use of
objective evidence to prove a party‘s subjective state of mind.
See Schiavone Constr. Co. v. Time, Inc., 847 F.2d 1069, 1090
(3d Cir. 1988) (―[O]bjective circumstantial evidence can
49
namely that for live television broadcasts the broadcaster
must know or be aware indecency will occur, risks
encouraging deliberate ignorance or failure to use available
preventive measures such as delay technology.
In addition to comporting with Congress‘s intent in
creating the civil forfeiture provision of § 503(b)(1)(D), a
civil recklessness standard provides protection commensurate
with indecency‘s constitutional status. The First Amendment
requires we apply ―only that mens rea which is necessary to
separate wrongful conduct from ‗otherwise innocent
conduct.‘‖ Carter v. United States, 530 U.S. 255, 269 (2000)
suffice to demonstrate actual malice.‖). The Supreme Court
has noted:
We might observe that it has been some time
now since the law viewed itself as impotent to
explore the actual state of a man‘s mind. See
[Roscoe] Pound, The Role of the Will in Law,
68 Harv. L. Rev. 1 [1954]. Cf. American
Communications Ass‟n, C.I.O., v. Douds, 339
U.S. 382, 411 [1950]. Eyewitness testimony of
a bookseller‘s perusal of a book hardly need be
a necessary element in proving his awareness of
its contents. The circumstances may warrant the
inference that he was aware of what a book
contained, despite his denial.
Smith v. California, 361 U.S. 147, 154 (1959); see also
Colorado v. Hall, 999 P.2d 207, 220 (Colo. 2000) (―In
addition to the actor‘s knowledge and experience, a court may
infer the actor‘s subjective awareness of a risk from what a
reasonable person would have understood under the
circumstances.‖).
50
(quoting X-Citement Video, 513 U.S. at 72). The issue
presents a difficult question of constitutional law, as the
plurality in Pacifica noted when it stated, ―the constitutional
protection accorded to a communication containing such
patently offensive sexual and excretory language need not be
the same in every context‖ and noted the Court ―tailored its
protection‖ of speech ―to both the abuses and the uses to
which it might be put.‖ Pacifica, 438 U.S. at 747 & n.24. At
a minimum, the FCC must show CBS had a sufficient level of
culpability to justify a civil forfeiture. Because displays of
indecent material ―surely lie at the periphery of the First
Amendment concern‖ an objective standard is appropriate.
Fox, 129 S. Ct. at 1819 (quoting Pacifica, 438 U.S. at 743).
Furthermore, an objective standard is not without precedent.22
22
In other areas such as use of ―fighting words‖—words
inherently likely to provoke a violent reaction—the Court has
looked at what reaction a reasonable speaker would expect
from the utterance of her speech. See Chaplinsky v. New
Hampshire, 315 U.S. 568, 573 (1942). Recent Supreme
Court cases have reaffirmed that some categories of speech
are entitled to lesser or even no constitutional protection.
There are traditional, though limited, categories where the
First Amendment has not protected those who would
―disregard these traditional limitations.‖ United States v.
Stevens, 130 S. Ct. 1577, 1584 (2010) (internal quotation
omitted). These categories (including obscenity) ―are ‗well-
defined and narrowly limited classes of speech, the
prevention and punishment of which have never been thought
to raise any Constitutional problem.‘‖ Id. (quoting
Chaplinsky, 315 U.S. at 571-72).
Unlike obscenity, indecency enjoys some
constitutional protection, but of a lesser kind. See Pacifica,
51
It is not sufficient to show that CBS should have acted
differently or was merely negligent. Inadvertence or common
negligence will not suffice. CBS contends there is no
evidence to support a finding that it acted recklessly. But this
is a question of proof committed to the FCC in the first
instance. CBS and the FCC continue to contest critical
issues. One consideration is the availability of delay
technology. CBS and the FCC dispute whether video delay
technology could have been implemented at the time of the
incident. They also dispute whether CBS should have
anticipated that indecent material could be broadcast—e.g.,
whether Jackson‘s choreographer‘s ―shocking moments‖
prediction should have put CBS on notice. Since the FCC
appears to have based its forfeiture orders on an erroneous—
or, at the least, unclear—standard of liability, after rejecting
CBS‘s APA arguments, I would remand to allow the agency
to measure CBS‘s conduct against the proper mens rea
standard.
IV.
In addition to the arguments addressed, CBS contests
the FCC‘s forfeiture orders on the ground that the agency‘s
multi-factor, contextual indecency standard is
unconstitutionally vague. In its most recent decision in Fox,
the United States Court of Appeals for the Second Circuit
endorsed this view, see Fox Television Stations, Inc. v. FCC,
438 U.S. at 748 (―Patently offensive, indecent material
presented over the airwaves confronts the citizen, not only in
public, but also in the privacy of the home, where the
individual‘s right to be left alone plainly outweighs the First
Amendment rights of an intruder.‖). An objective standard
comports with this peripheral status.
52
613 F.3d 317 (2d Cir. 2010), and CBS encourages us to
follow suit. In Fox, however, the constitutional question was
the primary, if not exclusive, issue left in the case after the
Supreme Court‘s remand. Here, it may be possible to dispose
of the action without resolving the constitutional question.
―A fundamental and longstanding principle of judicial
restraint requires that courts avoid reaching constitutional
questions in advance of the necessity of deciding them.‖
Lyng v. Nw. Indian Cemetery Protective Assn., 485 U.S. 439,
445 (1988). Therefore, I would not address the constitutional
issue.
V.
For the foregoing reasons, I would grant the petition
for review, vacate the FCC‘s forfeiture orders, and remand for
consideration of the forfeiture order under the proper
standard.
53