Portland Files Opposition Brief in Cable Access Appeal

(September 12, 1999) The City of Portland, the Oregon Internet Service Providers' Association, and GTE and U S West filed their opposition briefs with the Ninth Circuit in AT&T v. Portland on September 7. AT&T's reply brief, and amicus briefs of open access proponents, are due this week.

The City of Portland argued in its opposition brief that its ordinance conditioning the transfer of TCI cable licenses to AT&T upon providing open access to competing Internet service providers is not preempted by the Cable Act. To the contrary, Portland argued, 47 U.S.C. 553(d) expressly grants local cable regulatory entities the authority to deny transfers which would eliminate or reduce competition in the delivery of cable service.

The main issue in the case AT&T v. Portland is whether Portland and other local governments can impose conditions on providers of broadband cable Internet access. The City of Portland decided in January that AT&T must open its cable facilities to competing Internet Service Providers (ISPs). AT&T, which is spending many billions of dollars to acquire cable companies and upgrade their facilities to provide Internet access, does not want to give its competitors a free ride on its facilities. So, AT&T filed suit in federal court.

U.S. District Court Judge Owen Panner issued his Opinion in June, in which he agreed with Portland. AT&T appealed to the Ninth Circuit Court of Appeals. A host of friends of AT&T, including excite@home, the NCTA, and Hands Off the Internet, have filed amicus curaie briefs.

On September 7, the City of Portland and the County of Multnomah filed their opposition brief. Two supporting briefs were filed by the Oregon Internet Service Providers' Association (ORISPA) and U S West and GTE, who were intervenors in the trial court action.

The reply brief of AT&T is due on September 14. Also due at that time are amicus curiae briefs from supporters of the City of Portland. Briefs will be filed by OpenNet and the City of San Francisco.

AT&T's argued in its appeal brief that Portland had no authority to impose open access requirements, because such action is preempted by four different sections of the Cable Act of 1984, as amended.

Not surprisingly, the brief of the City of Portland argued that local authorities have broad powers to regulate cable service. Portland argued that the Cable Act of 1984 preserves local authority in cable regulation, including in the areas of competition and consumer protection. The brief states:

"The City and County retain broad police power authority to protect consumers and competition, so long as they do not violate the Cable Act. Appellants have failed to show that the open access condition is inconsistent with any provision of the Cable Act. It follows that the City and County, acting pursuant to their police powers, had the right to impose the open access condition." (Citations omitted.)

Portland also argued that the Cable Act, at 47 U.S.C. §533(d), expressly permits the conditioning of license transfers upon providing open access. The brief states:

In addition, however, the authority to impose a pro-competitive condition is specifically preserved by 47 U.S.C. §533(d), see Statement of Facts. It provides, among other things, that "[n]othing in this section shall be construed to prevent any ... franchising authority from prohibiting the ownership or control of a cable system ... in circumstances in which the ... franchising authority determines that the acquisition ... may eliminate or reduce competition in the delivery of cable service in such jurisdiction." (Excerpting in original.)

The brief of Portland also refuted at great length each of AT&T's four preemption arguments. The brief summarizes its preemption arguments as follows:

47 U.S.C. §541(b)(3)(D) prohibits a franchising authority from requiring a cable operator "to provide ... any telecommunications facilities" subject to certain exceptions. Appellants never raised a "telecommunications facilities" claim in the district court and should not be allowed to raise it on appeal. The argument is wrongheaded in any event. Appellants have always contended that their cable modem service is a cable service provided over a cable system. Third party provision of similar service on the same system does not transform cable facilities into telecommunications facilities.

47 U.S.C. §544(e) states that a franchising authority may not "prohibit, condition, or restrict" a cable system’s use of "any transmission technology." Appellants read this so broadly that it would literally preempt any regulation that could in any respect affect the equipment and facilities used by a franchisee. However, this statutory provision has been narrowly interpreted, extending only to requirements, for example, that a system use "coaxial" versus "optical" fibers. The open access condition does not mandate the use of any particular transmission technology; it does not violate 47 U.S.C. §544(e).

47 U.S.C. §541(c) prohibits the regulation of a cable system as a common carrier by reason of the provision of cable service. Appellants argue requiring open access to facilities is by definition common carrier regulation. However, to protect consumers and promote competition, companies that are not common carriers have been required to open their facilities to competitors (the cable industry, for example, has sought and obtained "open access" to apartment buildings). The Portland open access condition, like those requirements, has nothing to do with common carriage and everything to do with protecting competition.

47 U.S.C. §544(f) prohibits the imposition of "requirements regarding the provision or content of cable services...." Every court interpreting this section has read it narrowly to prohibit only requirements that are aimed at controlling the content of cable services. The open access condition does not require the provision of any particular content, by the Appellants, or by anyone else.

Appellants fail to demonstrate a "clear and manifest" Congressional intent to preempt through the cited provisions. They cannot do so in light of the specific "anti-preemption" provision of the Cable Act, 47 U.S.C. §556, Section 601(c) of the Telecommunications Act of 1996, and in light of 47 U.S.C. §533(b)(2), which was adopted to prevent preemption of local efforts to promote cable competition.