Court Rules that Open Access Ordinance Violates First Amendment Rights of Cable Operators

(November 15, 2000) The U.S. District Court ruled in favor of the cable operators in the Broward County cable access case. It held that the county ordinance requiring cable operators to provide their competitors with access to their broadband cable Internet access facilities violates the First Amendment rights of the cable operators.

Judge Donald Middlebrooks, Judge of the U.S. District Court for the Southern District of Florida, released his lengthy order and opinion on November 8 on the cross motions for summary judgment on the issue of whether or not forced access provisions violate the First Amendment.

The ruling, if upheld and followed by other courts, provides broad protection for ISPs from government regulation. The Court held that the Internet access and content services provided by cable operators are like newspapers, and entitled to the same level of protection as newspapers under the First Amendment. Moreover, the court held that the ordinance in question constitutes content based regulation, and hence, the strict scrutiny test applies.

The courts have extended considerable First Amendment protection to newspapers, but allowed the Federal Communications Commission (FCC), and other regulatory agencies, wide latitude in regulating both the content and means of disseminating speech by radio and TV broadcasters. The courts have also allowed some leeway in regulating cable TV operators. Indeed, the underlying premise of the FCC is that communications, which is essentially the same thing as speech, requires government regulation.

The landmark Supreme Court cases upholding FCC regulation of speech against First Amendment challenges are NBC v. US, 319 U.S. 190 (1943) and Red Lion Broadcsting Co. v. FCC, 395 U.S. 367 (1969). The Court reasoned in those eminent opinions that regulation speech is permissible because broadcast spectrum is scarce, and hence, the number of broadcasters is limited.

Broward County adopted an ordinance on July 13, 1999 that requires the cable companies in Broward County that provide Internet access to provide to any requesting ISP access to its cable facilities, unbundled from the provision of content, on rates, terms, and conditions that are at least as favorable as those on which it provides such access to itself. The ordinance was drafted by GTE, a competitor of the cable companies, and a provider of broadband Internet access via DSL

The cable companies that hold cable TV franchises in the covered area promptly filed complaints in the U.S. District Court seeking to have the ordinance overturned. See, for example, Complaint of Comcast.

The ordinance, and subsequent litigation, are not unique. Other local cable franchising authorities have passed similar ordinances in Portland, Oregon, in Richmond, Virginia, and elsewhere. However, unlike other cases, this opinion squarely addressed the First Amendment issues.

For example, in AT&T v. Portland, both the U.S. District Court opinion, and the U.S. Court of Appeals opinion which reserved it, turned on interpretation of the Communications Act of 1934. Having resolved the dispute on statutory grounds, the courts did not need to address the constitutional issues raised by AT&T.

In contrast, in the Broward County case the non-constitutional claims were removed earlier in the proceeding, leaving only the First Amendment issue to be litigated.

Citing the Turner I case (Turner Broadcasting System, Inc. v. F.C.C., 512 U.S. 622), the court began its analysis with the observation that "It is now well established that regulation of cable operators implicates both the Free Speech and Free Press clauses of the First Amendment." Broward County had argued in its briefs that its cable access ordinance was nevertheless permissible because it regulated the economic activity of providing broadband transport, not the content which the cable operators disseminated over those transport facilities.

Judge Middlebrooks reasoned both that the transmission and content are inseparable, and that the First Amendment offers protection to both transmission and content. He wrote that "The free press clause protects not only the words which appear on a newspaper's pages, but its printing and circulation as well."

Judge Middlebrooks elaborated that "The Broward County ordinance invidiously impacts a cable operator's ability to participate in the information market. The cable operator, unlike a telephone service, does not sell transmission but instead offers a collection of content. Like a newspaper, a cable operator sells advertising to defray the costs of its service."

He continued:

"The imposition of an equal access provision by operation of the Broward County Ordinance both deprives the cable operator of editorial discretion over its programming and harms its ability to market and finance its service, thereby curtailing the flow of information to the public. It distorts and disrupts the integrity of the information market by interfering with the ability of market participants to use different cost structures and economic approaches based upon the inherent advantages and disadvantages of their respective technology."

Judge Middlebrooks also distinguished the prior cases which upheld content regulation of broadcast radio and TV, and cable TV. With those technologies, consumers have only limited opportunities to access information. In contrast, with the Internet, there is an abundance of different sources of content. Citing studies conducted by the FCC, and the absence of any study by Broward County, he wrote that "Cable operators control no bottleneck monopoly over access to the Internet."

Judge Middlebrooks went on to conclude that the regulation at issue is content based, and thus wants application of the almost insurmountable strict scrutiny standard. However, he also wrote, that even if he had applied that less rigid standard for content neutral regulation of speech, he would have found that Broward County failed to meet that standard too.

This opinion is a major victory for cable operators who provide Internet access. Moreover, the analysis of this case could be extended to protect the providers of other means of Internet access. The case is a significant setback for government agencies (and those who seek to use government agencies) which seek to regulate the provision of content on, or connection to, the Internet.

However, whether this decision will be reversed on appeal, if any, and whether the analysis will be followed by other courts, is uncertain.