103787163 1 Prometheus App for Further Extension...Jeetander T. Dulani Pillsbury Winthrop Shaw Pittman LLP 1200 17th St., N.W. Washington, D.C. 20036 (202) 663-8000 [email protected]

No. 19A889

In the Supreme Court of the United States

NATIONAL ASSOCIATION OF BROADCASTERS, ET AL.,

Applicants,

v.

PROMETHEUS RADIO PROJECT, ET AL.,

Respondents.

APPLICATION FOR A FURTHER EXTENSION OF TIME

WITHIN WHICH TO FILE A PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

Eve Klindera Reed

Jeremy J. Broggi

WILEY REIN LLP

1776 K St., N.W.

Washington, D.C. 20036

(202) 719-7000

[email protected]

[email protected]

Counsel for Nexstar

Broadcasting, Inc.

Kevin F. King

Andrew Soukup

Rafael Reyneri

COVINGTON &

BURLING LLP

850 10th St., N.W.


(202) 662-6000

[email protected]

[email protected]

[email protected]

Counsel for News Media

Alliance

Helgi C. Walker

Counsel of Record

Jacob T. Spencer

GIBSON, DUNN & CRUTCHER LLP

1050 Connecticut Ave., N.W.


(202) 955-8500

[email protected]

[email protected]

Counsel for National Association

of Broadcasters

(additional counsel listed on next page)

David D. Oxenford

Wilkinson Barker Knauer, LLP

1800 M Street, N.W.

Suite 800N


(202) 783-4141

[email protected]

Counsel for Connoisseur Media LLC

Jeetander T. Dulani

Pillsbury Winthrop Shaw Pittman LLP

1200 17th St., N.W.


(202) 663-8000

[email protected]

Counsel for Sinclair Broadcast Group

Inc.

Kenneth E. Satten

Craig E. Gilmore


1800 M Street, N.W.

Suite 800N


(202) 783-4141

[email protected]

[email protected]

Counsel for Bonneville International

Corporation and The Scranton Times

L.P.

Sally A. Buckman

Paul A. Cicelski

Lerman Senter PLLC

2001 L St., N.W.

Suite 400


(202) 429-8970

[email protected]

[email protected]

Counsel for News Corporation

1

APPLICATION FOR A FURTHER EXTENSION OF TIME

TO THE HONORABLE SAMUEL A. ALITO, JR., ASSOCIATE JUSTICE OF THE

SUPREME COURT OF THE UNITED STATES AND CIRCUIT JUSTICE FOR THE

UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT:

Pursuant to Rules 13.5, 22, and 30.3 of this Court, Applicants Industry

Intervenors1 respectfully request a further 30-day extension of time—to and

including Saturday, April 18, 2020—within which to file a petition for a writ of

certiorari to the United States Court of Appeals for the Third Circuit. Unless

extended, the deadline to file a petition for a writ of certiorari is March 19, 2020.

1. The Third Circuit entered its judgment on September 23, 2019. Its

opinion, captioned Prometheus Radio Project v. FCC, 939 F.3d 567 (3d. Cir. 2019), is

attached as Exhibit A. The Third Circuit denied Applicants’ petition for panel

rehearing and rehearing en banc on November 20, 2019. The order denying rehearing

is unreported and a court-filed copy is attached as Exhibit B. On February 12, 2020,

Justice Alito extended the time in which to file a petition for certiorari to and

including March 19, 2020. This application is timely filed. See S. Ct. Rule 30.2. This

Court’s jurisdiction will be invoked under 28 U.S.C. § 1254(1).

2. This case presents important and recurring questions involving (1) the

interpretation of Section 202(h) of the Telecommunications Act of 1996, a statute

directing the FCC to review its rules restricting ownership of television stations, radio

stations, and newspapers every four years and to repeal or modify any regulation that

1 The Industry Intervenors are identified in the Corporate Disclosure Statement

appended to this Application.

2

is no longer in the public interest “as the result of competition,” Pub. L. No. 104-104,

§ 202(h), 110 Stat. 56, 111–12 (1996); see Pub. L. No. 108-199, § 629, 118 Stat. 3, 99-

100 (2004), and (2) the appropriate remedy under the Administrative Procedure Act

where, as here, a court of appeals identifies an isolated, supposed flaw in the agency’s

reasoning.

3. This case arises from a series of FCC orders addressing media ownership

rules.2 In the Reconsideration Order, the FCC repealed or modified many of its

ownership rules after concluding that they no longer served the public interest. In

vacating the Reconsideration Order, the Third Circuit misinterpreted Section 202(h).

It replaced Congress’s command to focus on competition with non-statutory policy

considerations about media ownership diversity. This error, if left to stand, will

continue to prevent the FCC from making necessary changes to its media ownership

rules and will distort every future quadrennial review of those rules. The error is

compounded because the same panel has retained jurisdiction over the statutorily

mandated periodic review for more than 15 years—and continues to assert

jurisdiction—blocking any other court of appeals or any other panel of the Third

Circuit from considering the question and properly interpreting Section 202(h).

2 The three orders at issue in this case are printed in the FCC Record. See In re 2014

Quadrennial Regulatory Review, Second Report and Order, 31 FCC Rcd. 9864 (2016)

(“Second R&O”), In re 2014 Quadrennial Regulatory Review, Order on

Reconsideration and Notice of Proposed Rulemaking, 32 FCC Rcd. 9802 (2017)

(“Reconsideration Order”), and In re Rules & Policies to Promote New Entry and

Ownership Diversity in the Broadcasting Services, Report and Order, 33 FCC Rcd.

7911 (2018) (“Incubator Order”).

3

4. This case involves an additional issue meriting this Court’s review. The

Third Circuit vacated multiple FCC orders based on a supposed flaw in one of those

orders, even though the court expressly acknowledged that the FCC could reach the

exact same conclusions after further consideration. The Third Circuit’s wholesale

vacatur conflicts with remedial approaches taken by seven other circuits, all of which

remand without vacatur where, as here, an agency could correct any flaws in its

reasoning while reaching the same ultimate result. See, e.g., Allied-Signal, Inc. v.

U.S. Nuclear Regulatory Comm’n, 988 F.2d 146, 150 (D.C. Cir. 1993). The overbroad

relief ordered by the Third Circuit was inconsistent with the supposed flaw the court

identified and poses serious implications for the effective and efficient use of

legislative, executive, and judicial resources.

5. This case is ideal for resolving the questions that will be presented. The

same Third Circuit panel has reviewed the FCC’s efforts to comply with Section

202(h) four times over 15 years. See Ex. A; Prometheus Radio Project v. FCC, 824

F.3d 33 (3d Cir. 2016); Prometheus Radio Project v. FCC, 652 F.3d 431 (3d Cir. 2011);

Prometheus Radio Project v. FCC, 373 F.3d 372 (3d Cir. 2004). Judges Ambro and

Fuentes have consistently remanded the FCC’s decision for failing to promote

ownership diversity to their satisfaction, and Judge Scirica has consistently

dissented. By continuing to retain jurisdiction, the panel has not only stymied

necessary regulatory reform, but has prevented any percolation on the proper

interpretation of Section 202(h). The Third Circuit’s misinterpretation thus

4

continues to distort the FCC’s quadrennial review process and will continue to do so

unless corrected by this Court.

6. A further 30-day extension to file a petition for a writ of certiorari is

necessary to allow counsel for the Industry Intervenors to prepare and file a petition

presenting these important questions to this Court. In addition, counsel for Industry

Intervenors has conferred with counsel for the FCC and understands that the FCC

will also be filing a request for a further 30-day extension of time to file a petition for

certiorari. Judicial efficiency counsels in favor of the FCC’s and Industry Intervenors’

petitions being submitted to this Court and considered concurrently. Industry

Intervenors are not aware of any party that would be prejudiced by the requested

extension.

Accordingly, good reason exists for this application and Industry Intervenors

respectfully request a further 30-day extension of time within which to file a petition

for a writ of certiorari, to and including Saturday, April 18, 2020.

5

Dated: March 9, 2020 Respectfully submitted,

Eve Klindera Reed

Jeremy J. Broggi

WILEY REIN LLP

1776 K St., N.W.


(202) 719-7000

[email protected]

[email protected]

Counsel for Nexstar

Broadcasting, Inc.

Kevin F. King

Andrew Soukup

Rafael Reyneri

COVINGTON &

BURLING LLP

850 10th St., N.W.


(202) 662-6000

[email protected]

[email protected]

[email protected]

Counsel for News Media

Alliance

/s/ Helgi C. Walker

Helgi C. Walker

Counsel of Record

Jacob T. Spencer

GIBSON, DUNN & CRUTCHER LLP

1050 Connecticut Ave., N.W.


(202) 955-8500

[email protected]

[email protected]

Counsel for National Association

of Broadcasters

David D. Oxenford


1800 M Street, N.W.

Suite 800N


(202) 783-4141

[email protected]

Counsel for Connoisseur Media LLC

Jeetander T. Dulani

Pillsbury Winthrop Shaw Pittman LLP

1200 17th St., N.W.


(202) 663-8000

[email protected]

Counsel for Sinclair Broadcast Group

Inc.

Kenneth E. Satten

Craig E. Gilmore


1800 M Street, N.W.

Suite 800N


(202) 783-4141

[email protected]

[email protected]

Counsel for Bonneville International

Corporation and The Scranton Times

L.P.

Sally A. Buckman

Paul A. Cicelski

Lerman Senter PLLC

2001 L St., N.W.

Suite 400


(202) 429-8970

[email protected]

[email protected]

Counsel for News Corporation

RULE 29.6 CORPORATE DISCLOSURE STATEMENT

Pursuant to Rule 29.6, Intervenors make the following disclosures.

Bonneville International Corporation is a privately held Utah

corporation. Bonneville’s sole shareholder is Deseret Management Corporation,

which, in turn, is privately held by the DMC Reserve Trust. There are three

individual trustees, who are appointed by The First Presidency of The Church of

Jesus Christ of Latter-day Saints.

Connoisseur Media LLC is a limited liability company organized in the

State of Delaware. Connoisseur is owned by Connoisseur Media Holdings, LLC,

which is in turn controlled by CM Broadcast Management, LLC.

National Association of Broadcasters is a nonprofit, incorporated

association of radio and television stations and broadcast networks. It has no parent

company, and has not issued any shares or debt securities to the public; thus no

publicly held company owns ten percent or more of its stock.

News Corporation is a publicly held company comprising business across a

range of media, including news and information services, book publishing, and digital

real estate services. No publicly held company owns 10% or more of News

Corporation’s stock.

News Media Alliance is a not-for-profit trade association representing nearly

2,000 companies engaged in all aspects of the news media industry in the United

States and Canada. Alliance members account for nearly 90 percent of the daily

newspaper circulation in the United States, as well as a range of online, mobile and

non-daily publications. The News Media Alliance was known as the Newspaper

Association of America until September 2016. The News Media Alliance has no

parent companies, and no publicly held company has a ten percent or greater

ownership interest in the News Media Alliance.

Nexstar Broadcasting, Inc. is a media corporation that owns and operates

commercial broadcast television stations. Nexstar is wholly owned by Nexstar Media

Group, Inc., which is a publicly held corporation. No publicly held corporation has a

ten percent or greater ownership interest in the stock of Nexstar Media Group, Inc.

The Scranton Times L.P. is controlled by its general partner, The Times

Partner, L.L.C., a Pennsylvania limited liability company, which is in turn privately

held and controlled by its four individual members.

Sinclair Broadcast Group Inc. is a media corporation that owns, operates,

and provides programming and sales services to television stations in various cities

across the country. Sinclair has no parent company and no publicly traded company

owns more than ten percent of Sinclair’s stock.

EXHIBIT A

567PROMETHEUS RADIO PROJECT v. FCCCite as 939 F.3d 567 (3rd Cir. 2019)

PROMETHEUS RADIO PROJECT

*National Association of Broad-casters **Cox Media Group

LLC, Intervenors

v.

FEDERAL COMMUNICATIONSCOMMISSION; United

States of America

Prometheus Radio Project and MediaMobilizing Project, Petitioners

in No. 17-1107

Multicultural Media, Telecom and Inter-net Counsel and National Associationof Black Owned Broadcasters, Inc.,Petitioners in 17-1109

The Scranton Times, L.P.,Petitioners in 17-1110

Bonneville International Corporation,Petitioners in 17-1111

*Prometheus Radio Project, Media Mo-bilizing Project, Benton Foundation,Common Cause, Media Alliance, Me-dia Council Hawaii, National Associa-tion of Broadcasters Employees andTechnicians Communications Work-ers of America, National Organizationfor Woman Foundation, Office ofCommunication of the United Churchof Christ Inc., Intervenors

Prometheus Radio Project; MediaMobilizing Project, Petitioners

(No. 18-1092, 18-2943)

Independent Television Group,Petitioners (No. 18-1669)

Multicultural Media, Telecom and Inter-net Council, Inc.; National Associa-tion of Black-owned Broadcasters, Pe-titioners (No. 18-1670, 18-3335)

Free Press; Office of Communication,Inc. of the United Church of Christ;National Association of BroadcastEmployees and Technicians-Commu-nications Workers of America; Com-mon Cause, Petitioners (No. 18-1671)

v.

Federal Communications Commission;United States of America

Nos. 17-1107, 17-1109, 17-1110, 17-1111Nos. 18-1092, 18-1669, 18-1670, 18-

1671, 18-2943 & 18-3335

United States Court of Appeals,Third Circuit.

Argued June 11, 2019

(Opinion filed September 23, 2019)

Background: Broadcasters and advocacygroups filed separate petitions for reviewof Federal Communications Commission’s(FCC’s) diversity initiatives and broadcastmedia ownership rules under Telecommu-nications Act of 1996. The cases weretransferred and consolidated.

Holdings: The Court of Appeals, Ambro,Circuit Judge, held that:

(1) as matter of first impression, petition-ers properly submitted declarations toestablish their standing along withtheir reply briefs, rather than estab-lishing their standing in their openingbrief;

(2) petitioners sufficiently alleged injury infact, as required to establish theirstanding to challenge FCC’s diversityinitiatives and broadcast media owner-ship rules;

* (Pursuant to the Clerk’s Order date 1/18/17) ** (Pursuant to the Clerk’s Order dated 2/7/17)

568 939 FEDERAL REPORTER, 3d SERIES

(3) FCC’s decision to retain its ‘‘top-four’’local television rule, while rescinding‘‘eight voices’’ rule, was not arbitraryand capricious;

(4) FCC provided adequate notice of itsdefinition of comparable markets forradio stations;

(5) FCC’s definition of comparable mar-kets for radio stations was not arbi-trary and capricious;

(6) FCC failed to adequately consider ef-fect its new rules would have on own-ership of broadcast media by womenand racial minorities; and

(7) FCC did not unreasonably delay actionon petitioners’ proposal to extend cableprocurement rules to broadcast media.

Ordered accordingly.

Scirica, Senior Circuit Judge, filed opinionconcurring in part and dissenting in part.

1. Administrative Law and ProcedureO1743, 1749

The scope of review under the Admin-istrative Procedure Act’s (APA) arbitraryand capricious standard is narrow and acourt is not to substitute its judgment forthat of the agency. 5 U.S.C.A. § 706(2).

2. Administrative Law and ProcedureO1743

Despite the deference owed to agencyaction under the Administrative ProcedureAct’s (APA) arbitrary and capricious stan-dard of review, courts require the agencyto examine the relevant data and articulatea satisfactory explanation for its action,including a rational connection betweenthe facts found and the choice made. 5U.S.C.A. § 706(2).

3. Telecommunications O1100Term ‘‘necessary,’’ as used in Tele-

communications Act provision requiringFederal Communications Commission

(FCC) to periodically review broadcastownership rules to determine if they are‘‘necessary in the public interest as theresult of competition,’’ means ‘‘useful,’’‘‘convenient,’’ or ‘‘helpful.’’ Telecommuni-cations Act of 1996, § 202(h), 47 U.S.C.A.§ 303 note.

See publication Words and Phrasesfor other judicial constructions anddefinitions.


Under the section of the Administra-tive Procedure Act (APA) allowing a courtto compel agency action unlawfully with-held or unreasonably delayed, the polestaris reasonableness. 5 U.S.C.A. § 706(1).


Under the section of the Administra-tive Procedure Act (APA) allowing a courtto compel agency action unlawfully with-held or unreasonably delayed, courts bal-ance the importance of the subject matterbeing regulated with the regulating agen-cy’s need to discharge all of its statutoryresponsibilities under a reasonable timeta-ble. 5 U.S.C.A. § 706(1).


For purposes of the AdministrativeProcedure Act (APA) section allowing acourt to compel agency action unlawfullywithheld or unreasonably delayed, thecourt should measure unreasonable delayby the following factors: (1) the length oftime that has elapsed since the agencycame under a duty to act; (2) the context ofthe statute authorizing the agency’s action;(3) the consequences of the agency’s delay;and (4) any plea of administrative error,administrative inconvenience, practical dif-ficulty in carrying out a legislative man-date, or need to prioritize in the face oflimited resources. 5 U.S.C.A. § 706(1).


7. Federal Civil Procedure O103.2, 103.3To have standing to sue in federal

court, a plaintiff must have: (1) an injury infact, meaning an invasion of a legally pro-tected interest which is concrete and par-ticularized and actual or imminent, notconjectural or hypothetical; (2) an injuryfairly traceable to the challenged action ofthe defendant, and (3) an injury likely, asopposed to merely speculative, that will beredressed by a favorable decision. U.S.Const. art. 3, § 2, cl. 1.

8. Telecommunications O1141Broadcasters and advocacy groups

properly submitted declarations to estab-lish their standing along with their replybriefs, rather than establishing theirstanding in their opening brief, on peti-tions for review of Federal Communica-tions Commission’s (FCC’s) diversity ini-tiatives and broadcast media ownershiprules under Telecommunications Act of1996, where same parties had been litigat-ing before the Court of Appeals for adecade, such that it was reasonable forpetitioners to assume that their qualifica-tion to continue in the case was readilyapparent, and issue of their standing wasraised for first time in intervenors’ meritsbrief. Telecommunications Act of 1996,§ 202(h), 47 U.S.C.A. § 303 note.

9. Administrative Law and ProcedureO1631(2)

Petitioners challenging agency actionmay supplement the administrative recordfor the purpose of establishing Article IIIstanding, even though judicial review ofagency action is usually limited to the ad-ministrative record. U.S. Const. art. 3,§ 2, cl. 1.


Article III standing requirements donot apply to agency proceedings. U.S.Const. art. 3, § 2, cl. 1.


Parties challenging agency action maysubmit materials to establish standing atany time in the litigation.


In general, materials to establishstanding to challenge agency action shouldbe submitted promptly once standing iscalled into question.

13. Telecommunications O1139

Broadcasters and advocacy groupssufficiently alleged injury in fact, as re-quired to establish their standing to chal-lenge Federal Communications Commis-sion’s (FCC’s) diversity initiatives andbroadcast media ownership rules underTelecommunications Act of 1996, whereconsolidation within industry, pursuant tonew rules, would harm broadcasters, andeven though any future mergers wouldrequire FCC approval, new rules wouldresult in approval of mergers that previ-ously would have been rejected. U.S.Const. art. 3, § 2, cl. 1; Telecommunica-tions Act of 1996, § 202(h), 47 U.S.C.A.§ 303 note.


Broadcasters and advocacy groupsdid not lack standing to challenge Feder-al Communications Commission’s (FCC’s)diversity initiatives and broadcast mediaownership rules under Telecommunica-tions Act provision requiring FCC to pe-riodically review ownership rules to de-termine if they were necessary in publicinterest as result of competition, althoughtheir objections to rule changes pertainedto ownership diversity and not to Act’spurpose of promoting competition, wheregoal of provision was not limited to pro-moting competition, and there was no re-


quirement for Article III standing thatharm alleged be closely tied to their legalargument. U.S. Const. art. 3, § 2, cl. 1;Telecommunications Act of 1996, § 202(h),47 U.S.C.A. § 303 note.


Review under the TelecommunicationsAct provision requiring Federal Communi-cations Commission (FCC) to periodicallyreview broadcast ownership rules to deter-mine if they are ‘‘necessary in the publicinterest as the result of competition’’ isintended to determine whether each of theownership rules serves the public interest,broadly conceived, in light of ongoing com-petitive developments within the industry.Telecommunications Act of 1996, § 202(h),47 U.S.C.A. § 303 note.

16. Federal Civil Procedure O103.2

There is no requirement that theharm alleged be closely tied to a challeng-er’s legal argument in order to have Arti-cle III standing. U.S. Const. art. 3, § 2, cl.1.


Federal Communication Commission’s(FCC) decision to retain its ‘‘top-four’’ lo-cal television rule, prohibiting merger ofany two of top four stations in a givenmarket, while rescinding ‘‘eight voices’’rule, prohibiting mergers that would leavefewer than eight independently-owned sta-tions in the market, was not arbitrary andcapricious under the Administrative Proce-dure Act (APA), where FCC’s decisionthat mergers between largest stations in amarket posed unique threat to competitionwas supported by record evidence, andTelecommunications Act provision requir-ing FCC to periodically review broadcastownership rules to determine if they werenecessary in public interest as result ofcompetition did not require FCC to re-place its existing rules. 5 U.S.C.A.

§ 706(2); Telecommunications Act of 1996,§ 202(h), 47 U.S.C.A. § 303 note.

18. Telecommunications O1129Federal Communication Commission

(FCC) provided adequate notice of its defi-nition of comparable markets for radio sta-tions, in order establishing incubator pro-gram that used waiver of rules governinglocal radio ownership as reward to induceparticipation by established broadcasters,where, after asking whether waiver shouldbe applicable in any similarly sized market,FCC’s notice of proposed rulemakingasked how it should determine which mar-kets were similarly sized, indicating that itwas considering range of different ways tomeasure market size.


The adequacy of an agency’s notice ofproposed rulemaking must be tested bydetermining whether it would fairly ap-prise interested persons of the subjectsand issues before the agency.

20. Administrative Law and ProcedureO1869(2)

Courts will consider the behavior ofcommenters in assessing whether an agen-cy’s notice of proposed rulemaking wasadequate.

21. Telecommunications O1100Federal Communication Commission’s

(FCC) definition of comparable marketsfor radio stations, in order establishingincubator program that used waiver ofrules governing local radio ownership asreward to induce participation by estab-lished broadcasters, was not arbitrary andcapricious under the Administrative Proce-dure Act (APA), where FCC consideredpotential that its definition would createperverse incentive for established broad-casters to incubate in markets with lowpopulations but many radio stations and


then use their waivers in ‘‘comparable’’markets with much greater populations,and it reasonably determined that suchpotential was not overly frightening. 5U.S.C.A. § 706(2).


(FCC) failed to adequately consider effectits new rules would have on ownership ofbroadcast media by women and racial mi-norities, in reviewing its diversity initia-tives and broadcast media ownership rulesunder Telecommunications Act of 1996,and, thus, its new rules were arbitrary andcapricious under the Administrative Proce-dure Act (APA); where FCC’s conclusionas to female ownership was not based onany record evidence, and its conclusion asto ownership by racial minorities wasbased on substantially incomplete statisti-cal analysis and reasoned explanation itgave rested on faulty and insubstantialdata. 5 U.S.C.A. § 706(2); Telecommunica-tions Act of 1996, § 202(h), 47 U.S.C.A.§ 303 note.


Courts will find agency action arbi-trary and capricious under the Administra-tive Procedure Act (APA) when the agencyentirely fails to consider an important as-pect of the problem. 5 U.S.C.A. § 706(2).


With respect to rulemaking, the Ad-ministrative Procedure Act’s (APA) arbi-trary and capricious standard imposes nogeneral obligation on agencies to produceempirical evidence; rather, it only requiresagencies to justify their rules with a rea-soned explanation. 5 U.S.C.A. § 706(2).


(FCC) did not unreasonably delay action

on minority broadcasters’ advocacy groups’proposal to extend cable procurementrules to broadcast media, in reviewing itsdiversity initiatives and broadcast mediaownership rules under Telecommunica-tions Act of 1996, where record did notsupport adopting proposal, largely becausecommenters did not offer any substantialsupporting materials for it, and FCC’sthree-year delay was evidently to keepproposal alive, rather than rejecting it out-right for lack of support. 5 U.S.C.A.§ 706(1); Telecommunications Act of 1996,§ 202(h), 47 U.S.C.A. § 303 note; 47 C.F.R.§ 76.75(e).

On Petition for Review of An Order ofthe Federal Communications Commission(FCC Nos. FCC-1: FCC-16-107; FCC-17-156; FCC-18-114)

Angela J. Campbell, Andrew J.Schwartzman, James T. Graves, Institutefor Public Representation, GeorgetownLaw, 600 New Jersey Avenue, N.W., Suite312, Washington, DC 20001, Counsel forPetitioners Prometheus Radio Project,Media Mobilizing Project, Counsel for In-tervenor Respondents Benton Foundation,National Association of Broadcast Employ-ees and Technicians Communication Work-ers of America, National Organization forWomen Foundation, Office of Communica-tion Inc. of the Church of Christ,

Cheryl A. Leanza (Argued), Best Best &Krieger, 2000 Pennsylvania Avenue, Suite5300, Washington, DC 20006, Counsel forPetitioners Prometheus Radio Project,Media Mobilizing Project, Office of Com-munication Inc. of the United Church ofChrist, National Association of BroadcastEmployees and Technicians Communica-tions Workers of America, Common Cause

Dennis Lane (Argued), David D’Ales-sandro, Stinson Leonard Street, 1775Pennsylvania Avenue, N.W., Suite 800,


Washington, DC 20006, Counsel for Peti-tioner Multicultural Media Telecom andInternet Council National Association ofBlack Owned Broadcasters, Inc.

Craig E. Gilmore, Kenneth E. Satten,Wilkinson Barker Knauer, 1800 M Street,N.W., Suite 800N, Washington, DC 20036,Counsel for Petitioners Scranton TimesLP, Bonneville International Corp.

Jack N. Goodman (Argued), Law Officesof Jack N. Goodman, 1200 New HampshireAvenue, N.W., Suite 600, Washington, DC20036, Counsel for Petitioner IndependentTelevision Group

Jessica J. Gonzalez, Free Press, 1025Connecticut Avenue, N.W., Suite 1110,Washington, DC 20036, Counsel for Peti-tioner Free Press

Thomas M. Johnson, Jr., General Coun-sel, David M. Gossett, Deputy GeneralCounsel, Jacob M. Lewis (Argued), Associ-ate General Counsel, James M. Carr, Mat-thew J. Dunne (Argued), William Scher,Richard K. Welch, Federal Communica-tions Commission, 445 12th Street, S.W.,Washington, DC 20554, Counsel for Re-spondent Federal Communications Com-mission

Makan Delrahim, Assistant AttorneyGeneral, Michael F. Murray, Deputy As-sistant Attorney General, Nickolai GilfordLevin, Robert B. Nicholson, Robert J.Wiggers, United States Department ofJustice, Antitrust Division/Appellate Sec-tion, 950 Pennsylvania Avenue, N.W.,Washington, DC 20004, Counsel for Re-spondent United States of America

Helgi C. Walker (Argued), Andrew G. I.Kilberg, Gibson Dunn & Crutcher, 1050Connecticut Avenue, N.W., Washington,DC 20036, Counsel for Intervenor Petition-er/Respondent National Association ofBroadcasters

Yosef Getachew, Common Cause, 80515th Street, N.W., Suite 800, Washington,

DC 20005, Counsel for Intervenor Respon-dent/Petitioner Common Cause

David E. Mills, Cooley, 1299 Pennsylva-nia Avenue, N.W., Suite 700, Washington,DC 20004, Counsel for Intervenor Petition-er Cox Media Group LLC

Kevin F. King, Rafael Reyneri, AndrewSoukup, Covington & Burling, 850 10thStreet, N.W., One City Center, Washing-ton, DC 20001, Counsel for Intervenor Re-spondent Fox Corp.

David D. Oxenford, Wilkinson BarkerKnauer, 1800 M Street, N.W., Suite 800N,Washington, DC 20036, Counsel for Inter-venor Respondent Connoisseur MediaLLC

Paul A. Cicelski, S. Jenell Trigg, Ler-man Senter, 2001 L Street, N.W., Suite400, Washington, DC 20036, Counsel forIntervenor Respondent New Corp.

Eve Klindera, Reed Jeremy J. Broggi,Wiley Rein, 1776 K Street, N.W., Wash-ington, DC 20006, Counsel for IntervenorRespondent Nextar Broadcasting Inc.

Jeetander T. Dulani, Pillsbury WinthropShaw Pittman, 1200 17th Street, N.W.,Washington, DC 20036, Counsel for Inter-venor Respondent Sinclair BroadcastGroup Inc.

Before: AMBRO, SCIRICA, andFUENTES, Circuit Judges

OPINION OF THE COURT

AMBRO, Circuit Judge

Here we are again. After our last en-counter with the periodic review by theFederal Communications Commission (the‘‘FCC’’ or the ‘‘Commission’’) of its broad-cast ownership rules and diversity initia-tives, the Commission has taken a series ofactions that, cumulatively, have substan-tially changed its approach to regulation ofbroadcast media ownership. First, it issued


an order that retained almost all of itsexisting rules in their current form, effec-tively abandoning its long-running effortsto change those rules going back to thefirst round of this litigation. Then itchanged course, granting petitions for re-hearing and repealing or otherwise scalingback most of those same rules. It alsocreated a new ‘‘incubator’’ program de-signed to help new entrants into thebroadcast industry. The Commission, inshort, has been busy. Its actions unsur-prisingly aroused opposition from many ofthe same groups that have battled it overthe past fifteen years, and that oppositionhas brought the parties back to us.

One of these petitioners argues that theFCC did not go far enough, and that thesame logic by which it repealed the so-called ‘‘eight voices’’ test of the local televi-sion ownership rule (which forbade merg-ers that would leave fewer than eight inde-pendently-owned stations in the market)should also have led it to abolish the ‘‘top-four’’ restriction in the same rule (whichforbids mergers among two or more of thefour largest stations in a market). We dis-agree; this was a reasonable exercise ofthe Commission’s policy-making discretion,as we held in the first round of this litiga-tion.

Another group of petitioners argues thatthe Commission’s new incubator programis badly designed, as its definition of ‘‘com-parable markets’’ for the reward waiverswas unlawfully adopted and would createperverse incentives. It also argues that theCommission has unreasonably failed to acton a proposal to extend the so-called ‘‘ca-ble procurement rules,’’ which promote di-versity in the cable television industry, tobroadcast media. We disagree: the ‘‘com-parable markets’’ definition for the incuba-tor program was also a reasonable exerciseof discretion, and the FCC’s failure to act

on the procurement rules proposal is notunreasonable so far.

We do, however, agree with the lastgroup of petitioners, who argue that theCommission did not adequately considerthe effect its sweeping rule changes willhave on ownership of broadcast media bywomen and racial minorities. Although itdid ostensibly comply with our prior re-quirement to consider this issue on re-mand, its analysis is so insubstantial thatwe cannot say it provides a reliable foun-dation for the Commission’s conclusions.Accordingly, we vacate and remand thebulk of its actions in this area over the lastthree years. In doing so, we decline togrant the requested extraordinary relief ofappointing a special master to oversee theFCC’s work on remand.

I. Background

To avoid sounding like a broken record,we recount only in brief the history of thiscase up through our most recent decision.The full account of the entire saga can befound in our earlier opinions. See Prome-theus Radio Project v. FCC, 373 F.3d 372,382–89 (3d Cir. 2004) (‘‘Prometheus I’’);Prometheus Radio Project v. FCC, 652F.3d 431, 438–44 (3d Cir. 2011) (‘‘Prome-theus II’’); and Prometheus Radio Projectv. FCC, 824 F.3d 33, 37–39 (3d Cir. 2016)(‘‘Prometheus III’’).

Under the Communications Act of 1934,47 U.S.C. § 151 et seq., Pub. L. No. 73-416,48 Stat. 1064 (1934), the Federal Commu-nications Commission has long maintaineda collection of rules governing ownershipof broadcast media. By preventing any oneentity from owning more than a certainamount of broadcast media, these ruleslimit consolidation and promote a numberof interests, commonly stated as ‘‘competi-tion, diversity, and localism.’’ See, e.g., Re-port and Order and Notice of ProposedRulemaking—2002 Biennial Regulatory


Review, 18 F.C.C.R. 13620 ¶ 8 (July 2,2003). By 1996, however, there was grow-ing sentiment that these rules were overlyrestrictive, and so Congress passed theTelecommunications Act. Pub. L. No. 104–104, 110 Stat. 56 (1996). Section 202(h) ofthat Act requires the Commission to re-view the broadcast ownership rules on aregular basis—initially biennial, lateramended to quadrennial, see Pub. L. No.108–199, § 629, 118 Stat. 3, 99–100 (2004)—to ‘‘determine whether any of such rulesare necessary in the public interest as theresult of competition.’’ TelecommunicationsAct, § 202(h). The Commission ‘‘shall re-peal or modify any regulation it deter-mines to be no longer in the public inter-est.’’ Id.

Thrice before we have passed on theCommission’s performance of its duties un-der § 202(h), or the lack thereof. In Pro-metheus I we reviewed the results of the2002 quadrennial review cycle. Then inPrometheus II we reviewed the results ofthe 2006 review cycle, which included theFCC’s actions on remand from Prome-theus I, as well as a separate order adopt-ing various policies designed to promotebroadcast media ownership by women andracial minorities.

After Prometheus II the Commissionfailed to complete its 2010 review cycleprior to the start of the 2014 cycle, and soin Prometheus III we reviewed not finalagency action pursuant to § 202(h) butrather, for the most part, agency inaction.Although we found the FCC had unreason-ably delayed action on the 2010 and 2014review cycles, we declined to vacate thebroadcast ownership rules in their entire-ty, but noted such a drastic remedy couldbecome appropriate in the future if theCommission continued dragging its feet.Id., 824 F.3d at 53–54. Relatedly, we re-manded a newly adopted rule governingthe treatment of joint sales agreements for

purposes of the television local ownershiprule, reasoning that the FCC could nothave a valid basis for promulgating such arule without first having determined, asrequired by § 202(h), that the local owner-ship rule itself should remain in place. Id.at 58–60.

We also held that the Commission hadunreasonably delayed a determination onthe definition of ‘‘eligible entities.’’ Theseare given certain preferences under theownership rules, see id. at 41, and thepurpose of these preferences was to en-courage ownership by women and minori-ties. The definition, however, was drawnfrom the Small Business Administration’sdefinition of small businesses, and focusedsolely on a company’s revenues. In Prome-theus I we had suggested that, on remand,the FCC should consider adopting a differ-ent definition based on the criteria for‘‘socially and economically disadvantagedbusinesses’’ (‘‘SDBs’’). See 373 F.3d at 428n.70; see also 13 C.F.R. § 124.103 (definingsocially disadvantaged businesses). TheCommission declined to adopt an SDB def-inition, and in Prometheus II we held thatthe revenue-based definition was arbitraryand capricious because there was no evi-dence it would advance the goals of in-creasing ownership by women and minori-ties. 652 F.3d at 469–71.

But the Commission had not reached adetermination one way or the other byPrometheus III. Instead it had suggest-ed—in various documents issued after Pro-metheus II, none of which constituted finalagency action on the matter—that it wouldreject a SDB definition, or the similar‘‘overcoming disadvantage preference’’(‘‘ODP’’) proposal, because it did not be-lieve those rules could survive constitution-al scrutiny under the Equal ProtectionClause of the Fourteenth Amendment. See824 F.3d at 45–48. It therefore indicatedits tentative plan to adopt the same defini-


tion we held unlawful in Prometheus II,even though it still lacked evidence thatthis would promote ownership diversity,because promoting ownership by smallbusinesses would be in the public interestregardless. Id. at 46.

We held that the Commission ‘‘had morethan enough time to reach a decision onthe eligible entity definition.’’ Id. at 48.This led to a remand and an ‘‘order [to]the Commission TTT to act promptly tobring the eligible entity definition to aclose.’’ Id. at 50. It was to ‘‘make a finaldetermination as to whether to adopt anew definition;’’ ‘‘[i]f it need[ed] more datato do so, it must get it.’’ Id. Finally, wepointed out that we did ‘‘not intend toprejudge the outcome’’ of the FCC’s analy-sis, and that we would review the merits ofits eventual decision once that decision hadbeen made through a final order. Id. at 50–51.

Three months after we decided Prome-theus III, the Commission followedthrough on its promise to take final actionon the 2010 and 2014 review cycles. ItsSecond Report and Order, 2014 Quadren-nial Regulatory Review, 31 F.C.C.R. 9864(2016) (the ‘‘2016 Report & Order’’), re-tained all of the major broadcast owner-ship rules—the newspaper/broadcastcross-ownership rule, the radio/televisioncross-ownership rule, the local radio own-ership rule, and the local television owner-ship rule—in their existing forms. It alsoadopted, again, a revenue-based definitionfor eligible entities. It concluded that anSDB or any related race- or gender-con-scious definition could not withstand con-stitutional scrutiny because, even thoughcourts might accept viewpoint diversity asa compelling governmental interest, theevidence did not show a meaningful con-nection between female or minority owner-ship and viewpoint diversity. Id. ¶ 297. TheCommission also declined to adopt an ODP

standard, reasoning that it would requireindividualized assessment that is not com-patible with the smooth operation of theFCC’s rules, and that such an individual-ized assessment could run afoul of FirstAmendment principles. Id. ¶ 306. On arelated issue, the Commission declined toimplement an ‘‘incubator program,’’ underwhich established broadcasters would beencouraged to assist new entrants to breakinto the industry, that would have em-ployed an ODP standard. Finally, theCommission reviewed a number of otherproposals to increase ownership diversity,rejecting most but noting some merit in aproposal to extend the cable procurementrules, which require cable companies toencourage minority-owned businesses towork with them, to broadcast media. TheCommission did not adopt this idea, in-stead calling for further comment.

A number of industry groups filed apetition for rehearing, and in November2017 the Commission granted that petitionin its Order on Reconsideration and No-tice of Proposed Rulemaking, 32 F.C.C.R.9802 (2017) (the ‘‘Reconsideration Order’’).This Order made sweeping changes to theownership rules. It eliminated altogetherthe newspaper/broadcast and television/ra-dio cross-ownership rules. It modified thelocal television ownership rule, rescindingthe so-called ‘‘eight voices’’ test but retain-ing the rule against mergers between twoof the top four stations in a given mar-ket—albeit now subject to a discretionarywaiver provision. And it announced theCommission’s intention to adopt an incuba-tor program, although it left the formalimplementation of that program to a sub-sequent order. In this context, the Recon-sideration Order called for comment onvarious aspects of the program, includinghow to define eligibility and how to encour-age participation by established broadcast-ers.


In August 2018 the Commission issuedthe Report and Order—In the Matter ofRules and Policies to Promote New Entryand Ownership Diversity in the Broad-casting Services, 33 F.C.C.R. 7911 (2018)(the ‘‘Incubator Order’’). That Order es-tablished a radio incubator program thatwould encourage established broadcastersto provide ‘‘training, financing, and accessto resources’’ for new entrants in the mar-ket. Id. ¶ 6. Eligibility to receive this as-sistance was defined using two criteria: anincubated entity must (1) qualify as asmall business under the Small BusinessAdministration’s rules, and (2) qualify as a‘‘new entrant,’’ meaning that it must ownno television stations and no more thanthree radio stations. Id. ¶ 8. The eligibilitycriteria make no overt reference to race,gender, or social disadvantage, but theCommission concluded that using the ‘‘newentrant’’ criterion would help boost owner-ship by women and minorities, as a bid-ding preference for new entrants in FCCauctions had that effect. Id. ¶ 21.

As an incentive for established broad-casters to participate in the program, theIncubator Order grants the incubating en-tity a reward waiver for the local radioownership rules. Among other options, thewaiver may be used in any market ‘‘com-parable’’ to the one in which incubationoccurs. Id. ¶ 66–67. This means that itmust be in the same market tier for pur-poses of the local radio rule, and thesetiers are defined by the number of stationsin a market. One tier runs from zero to 14stations, another from 15 to 29, a thirdfrom 30 to 44, and finally the highest tierincludes all markets with 45 or more sta-tions.

Before us are 10 different petitions forreview challenging different aspects of theCommission’s actions since PrometheusIII. After the 2016 Report & Order issuedin November of that year, Prometheus Ra-

dio Project (‘‘Prometheus’’) and Media Mo-bilization Project (‘‘MMP’’) filed a petitionfor review in our Court. About the sametime, three other petitions for review ofthe 2016 Report & Order were filed in theD.C. Circuit Court of Appeals: one by TheScranton Times, L.P. (‘‘Scranton’’); one byBonneville International Corporation(‘‘Bonneville’’); and one jointly by the Mul-ticultural Media, Telecom and InternetCouncil, Inc. (‘‘MMTC’’) and the NationalAssociation of Black-Owned Broadcasters(‘‘NABOB’’). The cases before the D.C.Circuit were transferred here and the fourcases consolidated in January 2017; theywere then held in abeyance while the Com-mission considered the petitions for re-hearing.

After the Reconsideration Order issuedin November 2017, four additional peti-tions for review were filed: one by Prome-theus and MMP in our Court as well asthree in the D.C. Circuit from (1) Indepen-dent Television Group (‘‘ITG’’), (2) MMTCand NABOB, and (3) a coalition of groupsincluding Free Press, the Office of Com-munication, Inc. of the United Church ofChrist (‘‘UCC’’), the National Associationof Broadcast Employees and Techni-cians—Communications Workers of Amer-ica (‘‘NABET-CWA’’), and Common Cause.Once again the D.C. Circuit transferredthe petitions before it to our Court, and weconsolidated the new wave of cases withthe existing petitions.

In February 2018 we stayed all proceed-ings pending the close of notice and com-ment on the Incubator Order. Once thefinal Order issued in August 2018, Prome-theus and MMP filed a petition for reviewin our Court, and MMTC and NABOBfiled another in the D.C. Circuit that wastransferred here and the cases consolidat-ed.

For purposes of briefing and oral argu-ment, the various petitioners divided into


three groups. The first included Prome-theus, MMP, Free Press, UCC, NABET-CWA, and Common Cause, who argue thatthe Commission has not adequately consid-ered how its changes to the broadcastownership rules will affect ownership bywomen and racial minorities. We refer tothis group as ‘‘Citizen Petitioners,’’ consis-tent with our past practice. See Prome-theus III, 824 F.3d at 39. A second group,consisting of MMTC and NABOB, arguesthat the Incubator Order’s definition of‘‘comparable markets’’ is unlawful and thatthe Commission has unreasonably withheldaction on a proposal to extend cable pro-curement rules to broadcast media. To dis-tinguish this group, we refer to its mem-bers as ‘‘Diversity Petitioners.’’ Finally,ITG—standing alone now as the only ‘‘De-regulatory Petitioner’’—challenges the re-tention of the ‘‘top-four’’ component of thelocal television rule (which, to repeat, bansmergers between two or more of the fourlargest stations in a given market).

The Commission defends its orders intheir entirety. Additionally, a group of In-tervenors—including both Scranton andBonneville as well as many of the Deregu-latory Petitioners from prior rounds of thislitigation—defends the FCC’s actions andargues further that Citizen and DiversityPetitioners lack standing.

II. Jurisdiction and Standard of Re-view

We have jurisdiction to hear these peti-tions for review of agency action under 47U.S.C. § 402(a) and 28 U.S.C. § 2342(1). Asnoted above and covered in § III.A below,Intervenors argue, with the support of theCommission, that Citizen and DiversityPetitioners lack standing.

[1, 2] Per § 706(2) of the Administra-tive Procedure Act (‘‘APA’’), we can setaside agency action that is arbitrary orcapricious. 5 U.S.C. § 706(2). ‘‘The scope of

review under the ‘arbitrary and capricious’standard is narrow and a court is not tosubstitute its judgment for that of theagency.’’ Motor Vehicle Mfrs. Ass’n of U.S.v. State Farm Mut. Auto. Ins. Co., 463U.S. 29, 43, 103 S.Ct. 2856, 77 L.Ed.2d 443(1983). Despite this deference, we requirethe agency to ‘‘examine the relevant dataand articulate a satisfactory explanationfor its action[,] including a rational connec-tion between the facts found and thechoice made.’’ Id. (internal quotationmarks omitted).

[3] When the FCC conducts a Qua-drennial Review under § 202(h), that provi-sion also affects our standard of review, asit requires that ‘‘no matter what the Com-mission decides to do to any particularrule—retain, repeal, or modify (whether tomake more or less stringent)—it must doso in the public interest and support itsdecision with a reasoned analysis.’’ Prome-theus I, 373 F.3d at 395. When § 202(h)refers to rules being ‘‘necessary,’’ thatterm means ‘‘useful,’’ ‘‘convenient,’’ or‘‘helpful.’’ Id. at 394.

[4–6] This case also involves challengesto agency inaction. Section 706(1) of theAPA allows us to ‘‘compel agency actionunlawfully withheld or unreasonably de-layed.’’ 5 U.S.C. § 706(1). Under this provi-sion, our ‘‘polestar is reasonableness.’’Public Citizen Health Research Grp. v.Chao, 314 F.3d 143, 151 (3d Cir. 2002). Wemust ‘‘balance the importance of the sub-ject matter being regulated with the regu-lating agency’s need to discharge all of itsstatutory responsibilities under a reason-able timetable.’’ Oil, Chem. & AtomicWorkers Union v. Occupational Safety &Health Admin., 145 F.3d 120, 123 (3d Cir.1998).

With this balance in mind, unreasonabledelay should be measured by the follow-ing factors: First, the court should as-


certain the length of time that haselapsed since the agency came under aduty to act. Second, the reasonablenessof the delay should be judged in thecontext of the statute authorizing theagency’s action. Third, the court shouldassess the consequences of the agency’sdelay. Fourth, [it] should consider anyplea of administrative error, administra-tive inconvenience, practical difficulty incarrying out a legislative mandate, orneed to prioritize in the face of limitedresources.

Id. (internal quotation marks omitted).

III. Analysis

A. Standing

[7] As a threshold matter, Intervenorsargue that Citizen and Diversity Petition-ers (called ‘‘Regulatory Petitioners’’ forease of reference in this section) lackstanding, and the FCC concurs in thatargument. To have standing to sue in fed-eral court under Article III of the Consti-tution, a plaintiff must have (1) an ‘‘injuryin fact,’’ meaning ‘‘an invasion of a legallyprotected interest which is (a) concreteand particularized[,] and (b) actual or im-minent, not conjectural or hypothetical,’’that is (2) ‘‘fairly traceable to the chal-lenged action of the defendant,’’ and itmust (3) be ‘‘likely, as opposed to merelyspeculative, that the injury will be re-dressed by a favorable decision.’’ Lujan v.Defenders of Wildlife, 504 U.S. 555, 560–61, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992)(internal citations and quotation marksomitted).

There are two separate disputes regard-ing Regulatory Petitioners’ standing. Firstis a procedural question. After Intervenorsraised the issue in their merits brief, Reg-ulatory Petitioners submitted declarationsto establish standing along with their replybriefs. Intervenors now argue that weshould not consider those declarations or

the facts asserted within them becausematerials to establish standing must besubmitted instead with Regulatory Peti-tioners’ opening briefs. Even accepting thedeclarations, Intervenors still disputestanding.

[8–10] We disagree on both counts. Itis well established that petitioners chal-lenging agency action may supplement theadministrative record for the purpose ofestablishing Article III standing, eventhough judicial review of agency action isusually limited to the administrative rec-ord. As the Tenth Circuit observed in USMagnesium, LLC v. EPA, 690 F.3d 1157,1164 (10th Cir. 2012), the Article III stand-ing requirements do not apply to agencyproceedings, and thus there is no reasonfor the facts supporting standing to be apart of the administrative record. It is,moreover, the practice in most of the Cir-cuits that have considered the matter toaccept these materials at any stage of thelitigation. In US Magnesium itself, forexample, the Tenth Circuit accepted sup-plemental materials that were attached toa petitioner’s reply brief. Id. (Its discus-sion did not squarely address the timingissue, only whether a court could properlygo beyond the administrative record toascertain standing at all.) The Seventh Cir-cuit has accepted supplemental submis-sions filed after oral argument. Texas In-dep. Producers and Royalty Owners Ass’nv. EPA, 410 F.3d 964, 971 (7th Cir. 2005).And the Ninth Circuit has expressly heldthat standing need not be established in anopening brief in cases like this. Nw. Envtl.Def. Ctr. v. Bonneville Power Admin., 117F.3d 1520, 1528 (9th Cir. 1997).

Against this, Intervenors marshal twosources of contradictory authority. First isthe Supreme Court’s statement, in a foot-note in Lujan itself, that ‘‘standing is to bedetermined at the commencement of suit.’’504 U.S. at 570 n.5, 112 S.Ct. 2130 (empha-


sis added). This is not on point. That foot-note sought only to rebut an argumentfrom Justice Stevens’s dissenting opinionthat, although the agencies whose actionswould harm the petitioners there were nottechnically parties to the lawsuit, thoseagencies would not ignore a decision fromthe Supreme Court interpreting the rele-vant legal provisions, and thus such a deci-sion would actually redress the petitioners’injuries. The majority rejected this argu-ment because it depended entirely on thecontingent fact that the Supreme Courtended up taking the case, which could nothave been known at the start of suit.Hence ‘‘commencement of suit’’ indicatesonly that standing must exist at the begin-ning of litigation, not that the materialsestablishing standing must be submitted atthat time.

The other authorities cited by Interve-nors are cases from the D.C. Circuit. See,e.g., Sierra Club v. EPA, 292 F.3d 895, 900(D.C. Cir. 2002). But that Circuit has aprovision of its local rules expressly re-quiring the petitioners in any ‘‘cases in-volving direct review TTT of administrativeactions’’ to file materials establishingstanding along with their opening brief.See D.C. Cir. Rule 28(a)(7). The cases citedby Intervenors all simply applied this rule,which does not apply to proceedings in ourcourt.

[11, 12] It appears that this is a ques-tion of first impression in our Circuit. Toresolve it, we adopt the view held overtlyby the Ninth Circuit and implicitly by theTenth and Seventh: parties may submitmaterials to establish standing at any timein the litigation.1 This is especially so here,

where the same parties have been litigat-ing before us for a decade and a half. Itwas not unreasonable for Regulatory Peti-tioners to assume that their qualification tocontinue in the case was readily apparent.Cf. Del. Dep’t. of Nat’l Res. & Envtl. Con-trol v. EPA, 785 F.3d 1, 8–9 (D.C. Cir.2015) (permitting petitioners to submitstanding materials with their reply briefdespite the contrary requirement of theD.C. Circuit’s local rules when they rea-sonably believed that standing was self-evident).

[13] Turning to the substance of stand-ing, Intervenors argue that Regulatory Pe-titioners’ alleged harm is not sufficientlyimminent to establish standing becauseany mergers under the new rules wouldrequire FCC approval and would be sub-ject to judicial review; in effect, Regulato-ry Petitioners have not produced evidencethat the rule changes will lead to addition-al consolidation. In addition, Intervenorscontinue, Regulatory Petitioners lackstanding because their objections to therule changes pertain to ownership diversi-ty and not to the § 202(h) purpose ofpromoting competition. We find none ofthese arguments persuasive.

The first two arguments share a com-mon theme: although Regulatory Petition-ers will be harmed by consolidation withinthe industry (a fact Intervenors do notappear to contest), it is speculative thatthe new rules will actually lead to consoli-dation. The problem is that encouragingconsolidation is a primary purpose of thenew rules. This is made clear throughoutthe Reconsideration Order, see, e.g., 32F.C.C.R. at 9811, 9836. The Government

1. As noted, other courts have gone so far as toaccept standing materials submitted after oralargument. See Texas Indep. Producers andRoyalty Owners Ass’n, 410 F.3d at 971. Thiscould be appropriate where the issue ofstanding is not raised until oral argument.

Although we do not set out a comprehensiverule for all cases, in general materials toestablish standing should be submittedpromptly once standing is called into ques-tion.


cannot adopt a policy expressly designedto have a certain effect and then, when thepolicy is challenged in court by those whowould be harmed by that effect, respondthat the policy’s consequences are entirelyspeculative. Intervenors cite Rain-bow/PUSH Coalition v. FCC, 330 F.3d539, 542–44 (D.C. Cir. 2003), but that caseonly held that petitioners there, whosought to assert standing simply as audi-ence-members, had to demonstrate that aproposed merger would have some specificbaleful effect(s) on the viewing audience,i.e., some degradation of the programmingavailable to that audience. Here Interve-nors do not contest that consolidation, if itoccurs, will harm the Regulatory Petition-ers.

Nor is it material that any future merg-ers would require FCC approval. Thepoint is that, under the new rules, it willapprove mergers that it would have reject-ed previously, with the rule changes in theReconsideration Order the key factor caus-ing those grants of approval. See SaraFischer, The local TV consolidation raceis here, Axios (Aug. 10, 2018), available athttps://www.axios.com/the-local-tv-consolidation-war-is-here-7c65f3fb-eaab-43c4-9a00-81303867dbee.html (‘‘Many localbroadcasters cite one key reason for theirconsolidation—[t]he FCC’s landmark deci-sion last year to roll back old regulationsthat limited the ability of TV companies toown properties in the same market.’’). In-tervenors’ citation to Clapper v. AmnestyInternational, USA, 568 U.S. 398, 410–11,

133 S.Ct. 1138, 185 L.Ed.2d 264 (2013), isnot to the contrary. It involved a ‘‘highlyattenuated chain of possibilities’’ that,among other things, would make it difficultto discern whether the challenged law waseven the cause-in-fact of the plaintiffs’ al-leged injuries.2 The causal chain here isanything but attenuated.

[14, 15] Intervenors’ third argumentfails for multiple reasons. First, they iden-tify incorrectly the goals of § 202(h) aslimited to promoting competition. Instead,as its text makes plain, review under thatprovision is intended to determine whethereach of the ownership rules serves thepublic interest, broadly conceived, in lightof ongoing competitive developments with-in the industry. See Prometheus I, 373F.3d at 390–95.

[16] In addition, there is no require-ment that the harm alleged be closely tiedto a challenger’s legal argument in orderto have Article III standing. Intervenorsinvoke a second Rainbow/PUSH Coalitionv. FCC case, 396 F.3d 1235, 1242–43 (D.C.Cir. 2005), there involving an objection torenewal of a radio station’s license becauseit had allegedly engaged in employmentdiscrimination. Audience members, theD.C. Circuit held, lacked standing to objectbecause the alleged violative conduct atissue had not harmed them at all. Thisdoes not support the notion that a partymay lack standing, even though it willsuffer a concrete and particularized injury,simply because it is the wrong ‘‘kind’’ of

2. Clapper involved a challenge to Section 702of the Foreign Intelligence Surveillance Act,50 U.S.C. § 1881a, part of the 2008 FISAAmendments. Pub. L. No. 110-261, 122 Stat.2436 (2008). The chain of possibilities theCourt identified ran as follows: ‘‘(1) the Gov-ernment will decide to target the communica-tions of non-U.S. persons with whom theycommunicate; (2) in doing so, the Govern-ment will choose to invoke its authority under[§ 702] rather than utilizing another method

of surveillance; (3) the Article III judges whoserve on the Foreign Intelligence SurveillanceCourt will conclude that the Government’sproposed surveillance procedures satisfy[§ 702]’s many safeguards and are consistentwith the Fourth Amendment; (4) the Govern-ment will succeed in intercepting the commu-nications of respondents’ contacts; and (5)respondents will be parties to the particularcommunications that the Government inter-cepts.’’


injury. That argument sounds not in therequirements of Article III but of ‘‘pruden-tial standing,’’ a now-discredited doctrineunder which courts would decline to hearcases within their jurisdiction if the plain-tiffs’ complaint did not fall within the ‘‘zoneof interests’’ protected by the law theyinvoked. In Lexmark Int’l, Inc. v. StaticControl Components, Inc., 572 U.S. 118,134 S.Ct. 1377, 188 L.Ed.2d 392 (2014), theSupreme Court held that this should beunderstood solely as a matter of statutoryconstruction, i.e., of determining whether agiven statutory cause of action extended toa particular plaintiff. Intervenors do notargue, and could not seriously contend,that Regulatory Petitioners do not qualifyas ‘‘aggrieved parties’’ for purposes of theAPA’s general cause of action. See 5U.S.C. § 702.

We emerge from the bramble to holdthat Regulatory Petitioners have standing.Thus we proceed to the merits issues be-fore us.

B. Retention of the Top-Four Rule

[17] Deregulatory Petitioner ITG ar-gues that the FCC’s decision to retain its‘‘top-four’’ local television rule, prohibitingthe merger of any two of the top fourstations in a given market, while rescind-ing the ‘‘eight voices’’ rule, was arbitraryand capricious. This is an issue we dealtwith before, in Prometheus I, when weupheld the top-four restriction against de-regulatory challenges. We noted that ‘‘wemust uphold an agency’s line-drawing deci-sion when it is supported by the evidencein the record.’’ Prometheus I, 373 F.3d at417 (citing Sinclair Broadcast Group, Inc.v. FCC, 284 F.3d 148, 162 (D.C. Cir. 2002);AT&T Corp. v. FCC, 220 F.3d 607, 627(D.C. Cir. 2000)). And the Commission hadample record evidence supporting its deci-sion to draw the line at four: it saw a‘‘cushion’’ of audience share between the

fourth- and fifth-ranked stations, reflectingthat the top four would be the affiliates ofthe four major national networks (ABC,CBS, NBC, and Fox); the same cushionwas apparent in national viewership fig-ures for the networks themselves; mergersbetween the third-and fourth-largest sta-tions in each of the ten largest marketswould produce a new largest station; andmergers among top-four stations wouldgenerally increase the statistical consolida-tion of the local market by a substantialamount. Id. at 418.

Now ITG argues that the FCC ‘‘failed torecognize that the same reasons it foundsupported repeal of the Eight-Voice testalso required it to repeal or modify theTop-Four Prohibition.’’ ITG Br. at 20. Itfirst takes issue with the notion of a rat-ings ‘‘cushion’’ between the top-four andother stations, in part questioning whetherthe cushion exists and in part asking whyit should matter. Id. at 28–29. It furthercontests the FCC’s reliance on its conclu-sion, from the 2002 review cycle, thatmergers among top-four stations wouldgenerally result in a new largest station,noting that the evidence shows that merg-ers between the third- and fourth-largeststations would not result in a new largestentity in roughly half of the markets withat least four stations. Id. at 29–30. Finally,it argues that the new waiver provisioncannot excuse that, as it sees things, therule as a whole is not rationally related tothe facts. Id. at 31–32.

We disagree. None of ITG’s argumentsmeaningfully distinguish our holding inPrometheus I. Just as in that case, ITGsimply takes issue with the way in whichthe Commission chose to draw the lines.The basic logic of the top-four rule, as werecognized in 2004, is that while consolida-tion may offer efficiency gains in general,mergers between the largest stations in amarket pose a unique threat to competi-


tion. See Prometheus I, 373 F.3d at 416.Although there might be other more tai-lored, and more complex, ways to identifythose problematic mergers, the simplest isto declare, as the Commission has done,that mergers between two or more of thelargest X stations in a market are notpermitted. The choice of X must be some-what arbitrary: each market’s contours willbe slightly different, and no single bright-line rule can capture all this complexity.But the television industry does generallyfeature a distinct top-four, correspondingto the four major national networks, andfour is therefore a sensible number to pick.And this is exactly the kind of line-draw-ing, where any line drawn may not beperfect, to which courts are the most def-erential. See id. at 417. ITG has much tosay about everything this simple rule miss-es, but that is beside the point. The Com-mission has the discretion to adopt a bluntinstrument such as the top-four rule if itchooses. Indeed we confronted, and reject-ed, this exact argument—that treating alltop-four stations the same wrongly ignoredthe variation in market structures—in Pro-metheus I. Id. at 417–18.

Nor is it improper that the FCC’s justi-fication for this rule is the same as it wasin the 2002 review cycle. Section 202(h)requires only that the Commission thinkabout whether its rules remain necessaryevery four years. It does not imply thatthe policy justifications for each regulationhave a shelf-life of only four years, afterwhich they expire and must be replaced.Nor does § 202(h), or any other authoritycited by ITG, require that the Commissionalways base its decisions on perfectly up-to-date data. In any event, ITG itself citesmore recent data presented to the Com-mission through the administrative pro-

cess, and this information paints a picturematerially identical to what the Commis-sion saw in 2002.

In this context, we reaffirm our conclu-sion from Prometheus I that retention ofthe top-four rule is amply supported byrecord evidence and thus is not arbitraryor capricious.3

C. ‘‘Comparable Markets’’ Definition

[18] Diversity Petitioners challengethe Incubator Order’s definition of compa-rable markets for radio stations, arguingthat it was not properly noticed and in anyevent was arbitrary and capricious.

Their argument devolves to this. Thebasic concept of the incubator programuses a waiver of the rules governing localradio ownership as a reward to induceparticipation by established broadcasters.The Notice of Proposed Rulemaking(‘‘NPRM’’) sought comment on the follow-ing questions about these reward waivers:‘‘How should the Commission structure thewaiver program? For example, should thewaiver be limited to the market in whichthe incubating activity is occurring? Alter-natively, should waiver be permissible inany similarly sized market? How would theCommission determine which markets aresimilar in size?’’ Reconsideration Order¶ 137. Diversity Petitioners take this toindicate only that the Commission wasconsidering two possibilities: either thatthe waiver could only be used in the samemarket where the incubating activity oc-curred or that it could be used in othermarkets of similar population. They con-tend that ‘‘size’’ in this context is mostnaturally read as referring to population,or some other indicator of market size

3. Accordingly, we need not address ITG’s ar-gument that the newly added waiver provi-sion, which allows the Commission to permita merger that would otherwise be barred by

the top-four rule if ‘‘the reduction in competi-tion is minimal and is outweighed by publicinterest benefits,’’ Reconsideration Order ¶ 82,cannot save an otherwise irrational rule.


(such as audience or listenership numbers),as opposed to the number of radio stationsin the market. The two responsive com-ments on this issue, they contend, seem tohave reflected this assumption. See Diver-sity Petitioners’ Br. at 16–17.

Instead, as noted, the Incubator Orderadopted a system of reward waivers thatcan be used in any ‘‘comparable’’ market,meaning not a market of similar populationbut one with a similar number of radiostations. This proposal was first describedin detail in the draft of the IncubatorOrder made available before the final or-der was promulgated. In response, Diver-sity Petitioners made several ex partecommunications with the Commission ex-pressing their concern over this definitionof ‘‘comparable’’ markets. Id. at 21–22.Their letters expressed concern that theproposed rule would allow a broadcaster toincubate in a small rural market and thenuse its reward waiver in a much largermarket, such as New York City, thus get-ting an outsized return for its investment.Thus Diversity Petitioners suggested thatthe rule should disallow using a waiver inanother top-tier ‘‘comparable’’ market thatis not within five spots of the incubatingmarket in the Nielsen population-basedrankings, but the Commission declined toadopt this proposal. See Incubator Order¶ 68.

[19, 20] Diversity Petitioners arguethat this was not adequate notice. We haveaddressed similar claims in both Prome-theus I, 373 F.3d at 411–412, and Prome-theus II, 652 F.3d at 449–50. Essentially,‘‘the adequacy of the notice must be testedby determining whether it would fairlyapprise interested persons of the ‘subjectsand issues’ before the agency.’’ Prome-theus I, 373 F.3d at 411 (quoting Am. Iron& Steel Inst. v. EPA, 568 F.2d 284, 293 (3dCir. 1977)). The strongest fact supportingDiversity Petitioners’ claim is the swift

response by commenters expressing sur-prise once the eventual definition of com-parable markets was made public. Courtswill consider the behavior of commentersin assessing whether notice was adequate.See, e.g., Sprint Corp. v. FCC, 315 F.3d369, 376 (D.C. Cir. 2003).

But parsing the language of the Noticeof Proposed Rulemaking itself suffices toshow that it did provide adequate notice.Specifically, after asking whether the waiv-er should be applicable in any similarlysized market, the NPRM asked how theCommission would determine which mar-kets are similarly sized. This strongly sug-gests that the Commission was consideringa range of different ways to measure mar-ket size, and it undercuts Diversity Peti-tioners’ assertion that the word ‘‘size’’could only be read to mean population. SeeDiversity Petitioners’ Br. at 16 (‘‘The ref-erence to ‘size’ in the NPRM is generallyunderstood in the broadcast industry tomean markets that have similar popula-tions.’’).

[21] Turning to the substance of thecomparable markets definition, DiversityPetitioners assert that the FCC’s defini-tion will create a perverse incentive forestablished broadcasters to incubate inmarkets with low populations but manyradio stations (using the example ofWilkes-Barre, Pennsylvania) and then usetheir waivers in ‘‘comparable’’ marketswith much greater populations (e.g., NewYork City). The Incubator Order respond-ed to this concern by noting that somemarkets with similar populations havevastly different numbers of stations, andstated that ‘‘[i]n crafting our standard, wefocused primarily on preventing the poten-tial for ownership consolidation in a mar-ket with fewer stations and independentowners than the market in which the incu-bation relationship added a new entrant.’’Incubator Order ¶ 68. It expected that


incubating entities will not necessarily usetheir waivers only in the largest markets,but rather wherever they face ownershiprestrictions under the FCC’s rules. Id.And it noted that some incubating entitiesmight not have relevant ownership inter-ests in other markets of similar populationsize, such that they would have no flexibili-ty under Diversity Petitioners’ proposedrules. Id.

Diversity Petitioners posit this as aninadequate response, but we disagree.They are correct that the Commission didnot rebut the suggestion that waiversmight be used in markets with much high-er populations than the ones where incuba-tion is occurring. It explained instead whyit did not think this prospect overly fright-ening. Diversity Petitioners suggest thatthis dynamic could reduce the positive in-fluence of the incubator program on own-ership diversity, as (they claim) smallermarkets like Wilkes-Barre are less di-verse. This is not supported by the record:as Intervenors note, many smaller marketsare quite racially diverse, see Intervenors’Br. at 50, and Diversity Petitioners’ rejoin-der that these markets contain fewer totalpeople of color than big cities like NewYork or Los Angeles, Diversity Petition-ers’ Reply Br. at 17 n.7, is essentiallytautological. And we cannot say that theCommission’s focus on the potential anti-competitive effects of the waiver programis unreasonable, for the waivers relate spe-cifically to rules designed to promote com-petition.

We therefore hold that the definition of‘‘comparable markets’’ in the IncubatorOrder was adequately noticed and is notarbitrary and capricious.

D. Effect of Rule Changes on Own-ership Diversity

[22] Citizen Petitioners argue that theCommission did not adequately consider

the effect its new rules would have onownership of broadcast media by womenand racial minorities. We agree. In Prome-theus III we stated that the ongoing at-tempt to bring the 2010 and 2014 reviewcycles to a close must ‘‘include a determi-nation about the effect of the rules onminority and female ownership.’’ 824 F.3dat 54 n.13 (internal quotation marks omit-ted). Both the 2016 Report & Order andthe Reconsideration Order ostensibly in-cluded such a determination, and each con-cluded that the broadcast ownership ruleshave minimal effect on female and minori-ty ownership. But these conclusions werenot adequately supported by the record,and thus they were arbitrary and capri-cious.

The 2016 Report & Order retained all ofthe existing ownership rules, but it alsoaddressed a proposal to tighten the localtelevision and radio ownership rules as ameans of promoting ownership diversity.The Commission rejected this proposal be-cause it found no evidence that reducingconsolidation would have that effect basedon the following evidence. The NationalTelecommunications and Information Ad-ministration (‘‘NTIA’’) had collected dataregarding the number of minority-ownedstations in the late 1990s. About a decadelater, the FCC itself began collecting thisdata through a survey using what is called‘‘Form 323.’’ See Prometheus III, 824 F.3dat 44 (discussing the use of Form 323 togather data about minority ownership). Itdid so with the express purpose of gener-ating better data about ways to increaseownership by women and minorities. Id.

What the 2016 Report & Order did wasto compare the NTIA data from the late1990s, around the time that the local own-ership rules were first relaxed, with thesubsequent Form 323 data. It saw thesame pattern for television and for radio:an initial decrease in minority-owned sta-


tions after the rules became more flexibleto permit more consolidation, followed by along-term increase. The NTIA showed 312minority-owned radio stations in 1995, justbefore the local radio rule was relaxed,followed by 284 in 1996–97, 305 in 1998,and 426 in 1999–2000. Form 323 data,meanwhile, showed 644 such stations in2009, 756 in 2011, and 768 in 2013. See2016 Report & Order ¶ 126–28. Turning totelevision, NTIA data showed 32 minority-owned stations in 1998—just before thelocal television rule was relaxed—and 23stations in 1999–2000, while Form 323 datashowed 60 stations in 2009, 70 in 2011, and83 in 2013. Id. ¶ 77.

Because the trendlines did not show thatrelaxing these rules had played a majorrole in restricting ownership diversity, theCommission thought that reversing theprocess (that is, tightening local radio andtelevision ownership rules) would also beunlikely to have a major effect. Id. ¶ 126.At the same time it did not think thatfurther loosening the rules would be aneffective means of promoting diversity, asthe data did not suggest that the increasefrom the late 1990s through the 2009–13period had been caused by the relaxedrules. See id. ¶ 78, 128. The Order statedthat the Commission remained ‘‘mindful ofthe potential impact of consolidation TTT

on ownership opportunities for TTT minori-ty- and women-owned businesses, and wewill continue to consider the implications inthe context of future quadrennial reviews.’’Id. ¶ 128. The 2016 Report & Order alsocited this same data to suggest that itsmodest revisions to the cross-ownershiprules would not be likely to have a majorinfluence on ownership diversity. Id. ¶ 196n.586.

The Reconsideration Order, by contrast,did make major changes to the ownershiprules, and it invoked the same evidence asthe 2016 Report & Order to conclude that

this would not meaningfully affect owner-ship diversity. Thus it stated, as to thecross-ownership rules, that ‘‘record evi-dence demonstrates that previous relax-ations of other ownership rules have notresulted in an overall decline in minorityand female ownership of broadcast sta-tions, and we see no evidence to suggestthat eliminating the [Newspaper/BroadcastCross-Ownership] Rule will produce a dif-ferent result and precipitate such a de-cline.’’ Reconsideration Order, ¶ 46. As tothe local television rule, the Order conclud-ed that ‘‘the record does not support acausal connection between modifications tothe Local Television Ownership Rule andminority and female ownership levels;’’thus the modifications ‘‘are not likely toharm minority and female ownership.’’ Id.¶ 83.

[23] Problems abound with the FCC’sanalysis. Most glaring is that, although weinstructed it to consider the effect of anyrule changes on female as well as minorityownership, the Commission cited no evi-dence whatsoever regarding gender diver-sity. It does not contest this. See Respon-dent’s Br. at 40 n.14. Instead it notes that‘‘no data on female ownership was avail-able’’ and argues that it ‘‘reasonably reliedon the data that was available and was notrequired to fund new studies.’’ Id. Else-where, however, the Commission purportsto have complied with our instructions toconsider both racial and gender diversity,repeatedly framing its conclusion in termsthat encompass both areas. See, e.g., id. at33–36. The trouble is that any ostensibleconclusion as to female ownership was notbased on any record evidence we can dis-cern. Courts will find agency action arbi-trary and capricious where the agency‘‘entirely fail[s] to consider an importantaspect of the problem,’’ State Farm, 463U.S. at 43, 103 S.Ct. 2856, and that iseffectively what happened here. The only


‘‘consideration’’ the FCC gave to the ques-tion of how its rules would affect femaleownership was the conclusion there wouldbe no effect. That was not sufficient, andthis alone is enough to justify remand.

Even just focusing on the evidence withregard to ownership by racial minorities,however, the FCC’s analysis is so insub-stantial that it would receive a failinggrade in any introductory statistics class.One basic problem is the way the Commis-sion treats the NTIA and Form 323 dataas comparable, even though these two datasets were created using entirely differentmethodologies. For example, we do notknow how many minority-owned stationsthe Form 323 survey would have found in1999, or how many the NTIA’s methodswould have found in 2009. Indeed theNTIA data is known to be substantiallyincomplete, and the large increase in mi-nority-owned radio stations it showed be-tween 1998 and 1999–2000 is thought tohave been caused by largely improvedmethodology rather than an actual in-crease in the number of minority-ownedstations. 2016 Report & Order ¶ 126. At-tempting to draw a trendline between theNTIA data and the Form 323 data isplainly an exercise in comparing apples tooranges, and the Commission does notseem to have recognized that problem ortaken any effort to fix it.

Even if we could treat the use of thesetwo data sets as reliable, the FCC’s statis-tical conclusions are woefully simplistic.They compare only the absolute number ofminority-owned stations at different times,and make no effort to control for possibleconfounding variables. The simplest ofthese would be the total number of sta-tions in existence. We do not know, forexample, whether the percentage of sta-tions that are minority-owned went up ordown from 1999 to 2009.

And even if we only look at the totalnumber of minority-owned stations, theFCC did not actually make any estimate ofthe effect of deregulation in the 1990s.Instead it noted only that, whatever thiseffect was, deregulation was not enough toprevent an overall increase during the fol-lowing decade. The Commission made noattempt to assess the counterfactual sce-nario: how many minority-owned stationsthere would have been in 2009 had therebeen no deregulation.

An analogy helps illustrate this point: ifan economy that has been growing at anannual 2% rate suffers a serious depres-sion in which it shrinks by 10%, and thenresumes growing at the same 2% rate, adecade later it will likely be bigger than itwas on the eve of the depression. But thisdoes not mean that the depression had noeffect on the size of the economy. Nothingin the FCC’s analysis rules out, or evenaddresses, the possibility that the 1990sderegulation caused such a one-time ‘‘de-pression’’ of minority ownership even if itdid not reverse the long-term increase inminority-owned stations.

The Commission does not really contestany of these deficiencies in its data or itsanalysis. Instead it argues that they areirrelevant. It notes, first of all, that owner-ship diversity is just one of many compet-ing policy goals it must balance when ad-justing its regulations. Respondent’s Br. at32–33. Thus, the Reconsideration Ordernoted that the Commission should not re-tain a rule that unduly burdened the com-petitive practices of all broadcasters‘‘based on the unsubstantiated hope thatthese restrictions will promote minorityand female ownership.’’ ReconsiderationOrder ¶ 65. It cites to broad support foreliminating the newspaper/broadcastcross-ownership rules, including from mi-nority media owners, as evidence that do-ing so would not have an adverse effect on


minority ownership. Respondent’s Br. at34. And it asserts that, while the data usedwas not perfect, it was the only evidenceavailable as to the effects of earlier roundsof deregulation on ownership diversity. Id.at 40. The Commission solicited evidenceon this issue during the notice-and-com-ment period, and it did not receive anyinformation of higher quality than theNTIA/Form 323 data. Thus it argues ithad no affirmative burden to produce addi-tional evidence or to fund new studiesitself. Id. at 47 (citing Stilwell v. Office ofThrift Supervision, 569 F.3d 514, 519(D.C. Cir. 2009)).

[24] We are not persuaded. It is truethat ‘‘[t]he APA imposes no general obli-gation on agencies to produce empiricalevidence,’’ only to ‘‘justify its rule with areasoned explanation.’’ Stilwell, 569 F.3dat 519. But in this case the reasoned expla-nation given by the Commission rested onfaulty and insubstantial data. In Stilwellthe agency had proceeded based on its‘‘long experience’’ supervising the regulat-ed industry and had support from the com-menters. Id. Here, the Commission has notrelied on its general expertise, and, outsideof the modifications to the newspa-per/broadcast cross-ownership rule, it doesnot rely on support from commenters. Ithas not offered any theoretical models oranalysis of what the likely effect of consoli-dation on ownership diversity would be.Instead it has confined its reasoning to aninsubstantial statistical analysis of unrelia-ble data—and, again, has not offered eventhat much as to the effect of its rules onfemale ownership.

Finally, it is true that promoting owner-ship diversity is but one of the policy goalsthe FCC must consider. But this onlyhighlights that it is something the Com-mission must consider. It is, as State Farmsays, ‘‘an important aspect of the prob-lem.’’ 463 U.S. at 43, 103 S.Ct. 2856. The

Commission might well be within its rightsto adopt a new deregulatory framework(even if the rule changes would have someadverse effect on ownership diversity) if itgave a meaningful evaluation of that effectand then explained why it believed thetrade-off was justified for other policy rea-sons. But it has not done so. Instead it hasproceeded on the basis that consolidationwill not harm ownership diversity. Thismay be so; perhaps a more sophisticatedanalysis would strengthen, not weaken, theFCC’s position. But based on the evidenceand reasoning the Commission has givenus, we simply cannot say one way or theother. This violated the Commission’s obli-gations under the APA and our remandinstructions, and we ‘‘may not supply areasoned basis for the agency’s action thatthe agency itself has not given.’’ Id. (citingSEC v. Chenery Corp., 332 U.S. 194, 196,67 S.Ct. 1760, 91 L.Ed. 1995 (1947)).

Accordingly, we vacate the Reconsidera-tion Order and the Incubator Order intheir entirety, as well as the ‘‘eligible enti-ty’’ definition from the 2016 Report & Or-der. On remand the Commission must as-certain on record evidence the likely effectof any rule changes it proposes and what-ever ‘‘eligible entity’’ definition it adopts onownership by women and minorities,whether through new empirical researchor an in-depth theoretical analysis. If itfinds that a proposed rule change wouldlikely have an adverse effect on ownershipdiversity but nonetheless believes that rulein the public interest all things considered,it must say so and explain its reasoning. Ifit finds that its proposed definition foreligible entities will not meaningfully ad-vance ownership diversity, it must explainwhy it could not adopt an alternate defini-tion that would do so. Once again we donot prejudge the outcome of any of this,but the Commission must provide a sub-


stantial basis and justification for its ac-tions whatever it ultimately decides.

E. Delay in Adopting ProcurementRules

[25] Finally, Diversity Petitioners ar-gue that the Commission has unreasonablydelayed action on their proposal to extendthe cable procurement rules to broadcastmedia. These rules require cable compa-nies to encourage minority- and female-owned businesses to do business withthem. See 47 C.F.R. § 76.75(e). A proposalto apply similar rules to broadcast mediacompanies was one of the proposals weinstructed the Commission to consider onremand all the way back in Prometheus I.See 373 F.3d at 421 n.59. In PrometheusIII, the same Diversity Petitioners arguedthe FCC had unlawfully refused to addressthese proposals. We declined to pass onthis challenge, noting that the Chairman ofthe FCC had committed to addressingthese proposals in what eventually becamethe 2016 Report & Order, and thus thechallenge was premature. See 824 F.3d at50 n.11. At the same time we ‘‘note[d] ourexpectation that the Commission will meetits proffered deadline.’’ The 2016 Report &Order ultimately found that there was‘‘merit in exploring’’ whether to adopt thisproposal, and stated that it would ‘‘evalu-ate the feasibility’’ of doing so. 2016 Report& Order ¶ 330. [J.A. at 169] The Notice ofProposed Rulemaking for the 2018 cyclesought comment on a number of aspects ofthis proposal, including its constitutionali-ty. See 2018 Quadrennial Regulatory Re-view—Review of the Commission’s Broad-cast Ownership Rules and Other RulesAdopted Pursuant to Section 202 of theTelecommunications Act of 1996, Notice ofProposed Rulemaking, 84 F.R. 6741, 6752(Feb. 28, 2019)

As set out at length in Prometheus III,when reviewing a claim of unreasonable

agency delay we evaluate four factors:first, the length of time since the agencycame under a duty to act; second, thecontext of the statute authorizing theagency’s action; third, the consequences ofthe agency’s delay; and, finally, any claimof administrative error, inconvenience, orpractical difficulty carrying out the obli-gation, especially in light of limited re-sources. See 824 F.3d at 39–40 (quotingOil, Chem. & Atomic Workers Union, 145F.3d at 123).

The Commission argues it has not un-reasonably delayed action because the rec-ord as of the 2016 Report & Order did notsupport adopting the proposal—largely be-cause the commenters did not offer anysubstantial supporting materials for it. SeeRespondent’s Br. at 89. We agree. This isnot like the eligible entity issue in Prome-theus III, where the FCC had failed to actfor well over a decade. At most, the agen-cy’s failure to act began with the 2016Report & Order three years ago. And theconsequence of the Commission’s failure toact at that time was evidently to keep theproposal alive, rather than rejecting it out-right for lack of support. Given all of this,not to mention that the NPRM for the2018 cycle has sought further comment onthis proposal, we do not at this time findunreasonable delay by the Commission.

That being said, we do anticipate thatthe Commission will take final action onthis proposal one way or another when itresolves the 2018 review cycle, at whichtime its decision will be subject to judicialreview. If it does not do so, we may reacha different conclusion as to the reasonable-ness of that additional delay.

F. Conclusion

Citizens and Diversity Petitioners havestanding to press their claims. On the mer-its, we hold that the FCC’s retention of the‘‘top-four’’ prong of its local television own-


ership rule was not arbitrary and capri-cious. We also hold that the IncubatorOrder’s definition of ‘‘comparable markets’’was adequately noticed and was not arbi-trary and capricious. And we decline tohold that the FCC has unreasonably de-layed action on the proposal to adopt pro-curement rules for the broadcasting indus-try. We do conclude, however, that theCommission has not shown yet that it ade-quately considered the effect its actionssince Prometheus III will have on diversi-ty in broadcast media ownership. Wetherefore vacate and remand the Reconsid-eration and Incubator Orders in their en-tirety, as well as the ‘‘eligible entity’’ defi-nition from the 2016 Report & Order.

Citizen Petitioners ask us to appoint amediator or master to ‘‘ensure timely com-pliance’’ with our decision. Citizen Peti-tioners’ Br. at 43. Courts will sometimesappoint a special master to oversee compli-ance with remedial decrees, but thesecases typically involve institutions such asprisons where the Court could not other-wise easily ascertain whether the defen-dant is complying, and the master’s job islimited only to observing and reporting.See, e.g., Ruiz v. Estelle, 679 F.2d 1115(5th Cir. 1982), amended in part and va-cated in part on other grounds, 688 F.2d266 (5th Cir. 1982) (per curiam). There isno need for such an observational specialmaster here, where the Commission’s ac-tions on remand will be published in theFederal Register and readily available forsubsequent judicial review. Moreover, wewould decline in any event to appoint aspecial master with any powers beyond thesimply observational, as doing so wouldraise grave constitutional concerns, see e.g.Cobell v. Norton, 334 F.3d 1128, 1141–42(D.C. Cir. 2003), and we do not doubt theCommission’s good faith in its efforts tocomply with our requests.

Because yet further litigation is, at thispoint, sadly foreseeable, this panel againretains jurisdiction over the remanded is-sues.

SCIRICA, Circuit Judge, concurring inpart and dissenting in part

The Telecommunications Act of 1996mandates that the Federal Communica-tions Commission (FCC) regularly reviewits broadcast media ownership rules to en-sure they remain in step with the demandsof a rapidly evolving marketplace. Yetsome of these rules date back to the 1990sand early 2000s, and one all the way to1975, before the Internet revolutionizedAmerican media consumption. Americanstoday increasingly rely on online sourcesfor local news and information. Studies inthe record reinforce what most people oldenough to recall the days before WiFi andiPads understand instinctively: the explo-sion of Internet sources has accompaniedthe decline of reliance on traditional media.The realities of operating a viable broad-casting enterprise today look little likethey did when the FCC enacted the cur-rent ownership rules. Despite all of this,the FCC’s broadcast ownership rules re-mained largely static for fifteen years.

The FCC’s most recent review of itsownership rules culminated in an orderthat accounted for these changes. TheFCC evaluated the current market dynam-ics, concluded the existing rules built for apre-Internet marketplace no longer servethe public interest, and repealed or modi-fied the rules accordingly. The FCCweighed the rules’ effects on competition,localism, and diversity to determine whatchanges would advance the public interest.

I join several parts of my colleagues’decision, including their rejection of thechallenges to the incubator program’s‘‘comparable markets’’ definition and theReconsideration Order’s retention of a


modified ‘‘top-four’’ restriction in the LocalTV Rule. But I do not share their conclu-sion that the Reconsideration Order andIncubator Order are arbitrary and capri-cious. In my view, the FCC balanced com-peting policy goals and reasonably predict-ed the regulatory changes dictated by thebroadcast markets’ competitive dynamicswill be unlikely to harm ownership diversi-ty. I would not delay the FCC’s actions. Iwould allow the rules to take effect anddirect the FCC to evaluate their effects onwomen- and minority-broadcast ownershipin its 2018 quadrennial review.

I.

The parties are intimately familiar withthe FCC’s quadrennial review of thebroadcast ownership rules. See Prome-theus Radio Project v. FCC, 824 F.3d 33(3d Cir. 2016) (Prometheus III); Prome-theus Radio Project v. FCC, 652 F.3d 431(3d Cir. 2011) (Prometheus II); Prome-theus Radio Project v. FCC, 373 F.3d 372(3d Cir. 2004) (Prometheus I). I summarizethe relevant history and principles thatguide this process before briefly reviewingthe FCC’s most recent action.

A.

The orders at issue stem from theFCC’s review of its broadcast ownershiprules. Through these rules the FCC ad-vances its statutory mandate to regulatebroadcast media as ‘‘public convenience,interest, or necessity requires.’’ 47 U.S.C.§ 303; see Nat’l Broad. Co. v. UnitedStates, 319 U.S. 190, 214, 63 S.Ct. 997, 87L.Ed. 1344 (1943). Early versions of theownership rules cabined common owner-ship within and across broadcast media topromote the public interest. See FCC v.Nat’l Citizens Comm. for Broad., 436 U.S.775, 780, 98 S.Ct. 2096, 56 L.Ed.2d 697(1978) (NCCB). The FCC adopted broad-cast ownership rules with the objective to

‘‘promot[e] competition among the massmedia’’ and to ‘‘maximiz[e] diversificationof services sources and viewpoints.’’ Id. at784, 98 S.Ct. 2096 (internal quotationmarks and citation omitted). These in turnwould benefit the public through higherquality programming and broader options.The FCC determines the appropriateamount of common ownership by weighingthe harms of excessive concentration—di-minished programming diversity, stifledcompetition, and the like—against thecompetitive realities of running viablebroadcast enterprises.

A need for regulatory reform becamepalpable as the Internet emerged, trans-forming how Americans receive news andentertainment. Rapid technological changehad left the framework regulating mediaownership ill-suited to the marketplace’sneeds. The public interest analysis at theheart of the FCC’s ownership rules is asdynamic as the media landscape. A staticset of ownership regulations could notserve the public interest for all time. SeePrometheus I, 373 F.3d at 437 (Scirica,C.J., dissenting in part and concurring inpart).

With continued change all but certain,Congress retooled the approach to regulat-ing affected markets. It enacted the Tele-communications Act of 1996, Pub. L. No.104-104, 110 Stat. 56, which directs theFCC to review the broadcast ownershiprules periodically. The relevant provision,Section 202(h), instructs:

The Commission shall review TTT all ofits ownership rules [quadrennially] aspart of its regulatory reform review TTT

and shall determine whether any of [its]rules are necessary in the public interestas the result of competition. The Com-mission shall repeal or modify any regu-lation it determines to be no longer inthe public interest.


Telecommunications Act of 1996, § 202(h),as amended by Pub. L. No. 108-199, § 629,118 Stat. 3, 99–100 (2004). ‘‘[C]ompetition,localism, and diversity’’ are the values thatguide the FCC’s ‘‘public interest’’ analysisunder Section 202(h). Prometheus I, 373F.3d at 400; see also id. at 446 (Scirica,C.J., dissenting in part and concurring inpart). The FCC considers five types ofdiversity: viewpoint, outlet, program,source, and minority and women owner-ship. See id. at 446 (Scirica, C.J. dissentingin part and concurring in part) (summariz-ing the FCC’s analysis in its 2002 biennialreview order).

Embodied in Section 202(h) is the imper-ative that the broadcast ownership rulesstay in sync with the media marketplace.See id. at 391. What is in the ‘‘publicinterest’’ changes over time as the market-place evolves, so the FCC must reassesscompetitive conditions to set appropriateregulations. The provision’s language andthe accompanying legislative history reveala belief that ‘‘opening all telecommunica-tions markets to competition’’ will best suita marketplace comprised of diverse mediaplatforms and shaped by technological ad-vancement. See H.R. Rep. No. 104-458, at113 (1996) (Conf. Rep.). Section 202(h) di-rects the FCC to assess the harms ofconsolidation and abandon restrictions thatdeprive the public of competitive benefitsassociated with some levels of commonownership.1

B.

The FCC concluded its 2010/14 quadren-nial review by largely retaining the rulesrestricting common ownership. See SecondReport & Order, 2014 Quadrennial Regu-latory Review, 31 FCC Rcd. 9864 (2016)(2016 Report & Order). The rules, accord-ing to the FCC, ‘‘promote[d] competition

and a diversity of viewpoints in local mar-kets, thereby enriching local communitiesthrough the promotion of distinct and an-tagonistic voices.’’ Id. ¶ 3.

On petitions for reconsideration, theFCC repealed or loosened most of theseownership rules. See Order on Reconsider-ation and Notice of Proposed Rulemaking,32 FCC Rcd. 9802 (2017) (ReconsiderationOrder). The thrust of the FCC’s analysis isthat technological innovation and funda-mental changes to the media marketplacehave eroded many of the assumptions un-derlying the ownership rules. See, e.g., id.¶¶ 1, 19, 22, 43, 60, 71–73. The rules havethus ceased serving the public interest.The Internet boom has ushered in rivalsthat enjoy competitive advantages vis-a-visbroadcasters. The ownership rules impedebroadcasters’ ability to engage in procom-petitive transactions without offering com-pensating benefits to the public.

The FCC’s repeal of the Newspa-per/Broadcast Cross-Ownership (NBCO)Rule illustrates the Reconsideration Or-der’s public interest balancing. The NBCORule barred combinations between broad-cast stations and local newspapers to pre-serve ‘‘strong local voices.’’ Id. ¶ 9. Whenthe rule was adopted in 1975, daily printnewspapers constituted a predominantvoice in local news. The rule thus promot-ed viewpoint diversity and localism by en-suring independent sources of local con-tent. But the FCC’s careful study andinformed judgment show this reasoning nolonger holds. Traditional media competewith ‘‘digital-only news outlets with noprint or broadcast affiliation.’’ Id. ¶ 19. TheFCC determined that the burst of Internetsources means local newspapers’ indepen-dence from broadcast is no longer essen-tial to promote viewpoint diversity. See id.

1. Although framed in deregulatory terms, wehave understood the provision to allow modi-

fications making the rules ‘‘more or less strin-gent.’’ Prometheus I, 373 F.3d at 395.


¶¶ 18–22. The flipside of this growth is thedwindling significance of print newspapers.Repealing the NBCO Rule, the FCC de-termined, lifts a barrier to combinationsthat may enhance localism. See id. ¶ 26.Transactions between broadcasters and lo-cal newspapers could enable ‘‘collaborationand cost-sharing’’ that improve programquality. Id. ¶ 27. These efficiencies could‘‘attract new investment in order to pre-serve and expand’’ local programming. Id.¶ 42. The FCC predicted repeal of theNBCO Rule ‘‘is unlikely to have a signifi-cant effect on minority and female owner-ship in’’ broadcast markets in part becausebroadcasters would be better positioned toacquire newspapers than the reverse. Id.¶ 46. So ownership diversity, like competi-tion and localism, did not justify keepingthe rule. See id. ¶ 48.

While the FCC’s public interest analysisbalances competition, localism, and diversi-ty, the last consideration has attractedmost of the attention in this litigation.Neither the 2016 Report & Order nor Re-consideration Order found evidence thatshowed keeping or changing the ruleswould affect ownership diversity. ‘‘[E]m-pirical study of the relationship betweencross-ownership restrictions’’ and owner-ship diversity is complicated by ‘‘obstaclesthat make such study impractical and un-reliable,’’ the FCC observed, yet it invitedcomment on both study design and thelikely connection. Quadrennial RegulatoryReview—Review of The Commission’sBroadcast Ownership Rules and OtherRules Adopted Pursuant to Section 202 ofthe Telecommunications Act of 1996, et al.,Further Notice of Proposed Rulemakingand Report and Order, 29 FCC Rcd. 4371¶ 198 n.595 (2014) (2014 FNPRM). The2016 Report & Order rejected argumentsthat making the rules more restrictive‘‘will promote increased opportunities forminority and female ownership’’ becausethe record lacked evidence supporting

such a causal connection. ¶ 77 (Local TVRule); see id. ¶ 127 (Local Radio Rule).The Reconsideration Order considered theconsequences of relaxing the rules on own-ership diversity and determined the recorddid not support arguments that minorityand women broadcasters would be harmedby the changes. See, e.g., ¶ 15 (NBCORule) (‘‘[W]e find that eliminating the rulewill have no material effect on minorityand female broadcast ownership.’’). Nocommenter introduced evidence that con-tradicted the FCC’s prediction that chang-ing the rules would unlikely affect owner-ship diversity. The Reconsideration Orderannounced the FCC’s intention to pursuean incubator program, to facilitate entryand bolster ownership diversity. See¶¶ 121–25.

II.

Citizen Petitioners contend the FCC’sorders are arbitrary and capricious be-cause they do not adequately analyze thenew rules’ likely effects on minority andwomen broadcast ownership. The APA’s‘‘arbitrary and capricious’’ standard to-gether with Section 202(h) guide our re-view.

We must ‘‘hold unlawful and set asideagency action, findings, and conclusions’’that are ‘‘arbitrary [or] capricious.’’ 5U.S.C. § 706(2)(A). Under this deferentialreview, we uphold the FCC’s decision pro-vided it ‘‘examine[d] the relevant data andarticulate[d] a satisfactory explanation forits action including a ‘rational connectionbetween the facts found and the choicemade.’ ’’ Motor Vehicle Mfrs. Ass’n v. StateFarm Mut. Auto. Ins. Co., 463 U.S. 29, 43,103 S.Ct. 2856, 77 L.Ed.2d 443 (1983)(quoting Burlington Truck Lines v. Unit-ed States, 371 U.S. 156, 168, 83 S.Ct. 239, 9L.Ed.2d 207 (1962)). Where, as here, theFCC makes predictions about the likely


consequences of its decisions, ‘‘completefactual support in the record for [its] judg-ment or prediction is not possible or re-quired.’’ NCCB, 436 U.S. at 814, 98 S.Ct.2096; Rural Cellular Ass’n v. FCC, 588F.3d 1095, 1105 (D.C. Cir. 2009) (‘‘WhereTTT the FCC must make predictive judg-ments about the effects of [its regulations],certainty is impossible.’’). These predic-tions are ‘‘less amenable to rigid proof’’;they ‘‘are more in the nature of policydecisions entitled to substantial defer-ence.’’ NAACP v. FCC, 682 F.2d 993, 1001(D.C. Cir. 1982), rev’d on other grounds,FCC v. Fox Telev. Stations, Inc., 556 U.S.502, 129 S.Ct. 1800, 173 L.Ed.2d 738(2009).

As this Court has emphasized and notesagain here, Section 202(h) ‘‘also affects ourstandard of review.’’ Prometheus III, 824F.3d at 40; see Maj. Op. 577. To the extentthe meaning of Section 202(h) is disputed,the question would ordinarily ‘‘implicat[e]an agency’s construction of the statutewhich it administers,’’ thus triggering ‘‘theprinciples of deference described in’’ Chev-ron U.S.A. Inc. v. Natural Resources De-fense Council, Inc., 467 U.S. 837, 842, 104S.Ct. 2778, 81 L.Ed.2d 694 (1984). INS v.Aguirre-Aguirre, 526 U.S. 415, 424, 119S.Ct. 1439, 143 L.Ed.2d 590 (1999); seealso Sinclair Broad. Grp. v. FCC, 284 F.3d148, 165 (D.C. Cir. 2002) (deferring toFCC’s reasonable interpretation of anoth-er provision of the TelecommunicationsAct of 1996 under Chevron).

III.

My colleagues find, ‘‘based on the evi-dence and reasoning the Commission hasgiven us,’’ it has not satisfied its obli-gation to show changes in the ownershiprules ‘‘will not harm ownership diversity.’’Maj. Op. 587. But the FCC enjoys ameasure of deference when it balancespolicy objectives based on predictions of

the consequences of its rules. This keydisagreement leads me to depart from mycolleagues in three respects. First, be-cause the FCC’s consideration of the in-terplay between its ownership rules andownership diversity satisfies the APA andSection 202(h), I would deny the chal-lenges to the Reconsideration Order andallow the new rules to take effect. Second,I believe the substance of the FCC’s eligi-ble entity definition and the process bywhich it was adopted accords with theAPA. Third, I do not believe the FCCacted arbitrarily or capriciously when itadopted the Incubator Order. According-ly, I would deny the petitions and allowthe FCC’s orders to take effect.

A.

Citizen Petitioners leave untouched theFCC’s core determination that the owner-ship rules have ceased to serve the ‘‘publicinterest.’’ The Reconsideration Orderchronicles significant changes throughoutmedia markets and explains why maintain-ing the rules no longer serves that publicinterest goal. No party identifies any rea-son to question the FCC’s key competitivefindings and judgments. Citizen Petition-ers argue instead that all the rule changesthat make up the Reconsideration Ordershould be vacated because the FCC didnot adequately consider the new rules’likely effects on women- and minority-broadcast ownership. But neither Section202(h) nor the APA requires the FCC toquantify the future effects of its new rulesas a prerequisite to regulatory action. Con-gress prescribed an iterative process; theFCC must take a fresh look at its rulesevery four years. This process assumes theFCC can gain experience with its policiesso it may assess how its rules function inthe marketplace. The FCC has sufficientlyexplained its decision and deserves an op-portunity to implement its policies.


Citizen Petitioners overlook ‘‘that theCommission’s judgment regarding how thepublic interest is best served is entitled tosubstantial judicial deference.’’ FCC v.WNCN Listeners Guild, 450 U.S. 582, 596,101 S.Ct. 1266, 67 L.Ed.2d 521 (1981). TheFCC’s Section 202(h) review typifies agen-cy policymaking entitled to deference, sub-ject to the APA. Section 202(h) directs theFCC to balance competing goals—compe-tition, localism, and diversity—to guaran-tee that its ‘‘regulatory framework [keeps]pace with the competitive changes in themarketplace.’’ Prometheus I, 373 F.3d at391. The FCC enjoys a ‘‘considerableamount of discretion’’ when it weighs ob-jectives to reach policy decisions. RuralCellular, 588 F.3d 1095, 1103 (D.C. Cir.2009) (internal quotation marks and cita-tion omitted). The record confirms theFCC analyzed the relevant considerationsand properly exercised its discretion. See,e.g., Reconsideration Order ¶ 63 (Ra-dio/TV Cross-Ownership Rule) (concludingthe rule ‘‘no longer strikes an appropriatebalance between the protection of view-point diversity and the potential publicinterest benefits that could result from theefficiencies gained by common ownershipof radio and television stations in a localmarket’’); see also id. ¶¶ 55–58 (rule nolonger contributes substantially to view-point diversity); id. ¶ 59 (rule is out of stepwith ‘‘realities of the digital media market-place’’); id. ¶ 62 (‘‘rule already permitssignificant cross-ownership in local mar-kets’’); id. ¶ 64 (‘‘no evidence that anyadditional common ownership’’ resultingfrom repeal ‘‘would disproportionately ornegatively impact minority- and female-owned stations’’).

Traditional principles of deference areparticularly apt here. Not every decisionthe FCC makes is susceptible to preciseanalysis; some ‘‘rest on judgment and pre-diction rather than pure factual determina-tions.’’ WNCN Listeners Guild, 450 U.S. at594, 101 S.Ct. 1266. Predictions about thefuture effects of rules not yet in being are‘‘inherently speculative.’’ Council TreeInv’rs, Inc. v. FCC, 863 F.3d 237, 243 (3dCir. 2017) (Council Tree IV) (internal quo-tation marks omitted).

The FCC reasonably predicted on therecord before it that the new rules wouldnot diminish or harm minority and womenownership. The question whether the rulesand ownership diversity are interconnectedwas aired over the course of the 2010/14quadrennial review. The FCC invited com-ment and data that might shed light onthis connection. See, e.g., 2014 FNPRM¶ 222. It concluded—based on its under-standing of the broadcast markets, the evi-dence in the record, and the only datasubmitted—that repeal of the rules wasunlikely to harm ownership diversity. See,e.g., Reconsideration Order ¶ 83 (Local TVRule) (‘‘In this lengthy proceeding, no par-ty has presented contrary evidence or acompelling argument demonstrating whyrelaxing this rule will’’ harm ownershipdiversity.); id. ¶ 69 (adopting revised rulebased on understanding of changed com-petitive dynamics); id. ¶ 71 (observingchanges in marketplace but noting ‘‘broad-cast television stations still play a uniqueand important role in their local communi-ties’’); see also 2014 FNPRM ¶ 224 (Ra-dio/TV Cross-Ownership Rule) (noting nocommenter has shown ‘‘low levels of [wom-en and minority] ownership are a result ofexisting radio/television cross-ownershiprule’’).2 The effect the new rules will have

2. To the extent my colleagues require the FCCto conduct empirical analysis on remand, theyrisk impermissibly adding requirements be-yond the APA. See Perez v. Mortgage Bankers

Ass’n, ––– U.S. ––––, 135 S. Ct. 1199, 1207,191 L.Ed.2d 186 (2015). They quote Stilwell v.Office of Thrift Supervision’s instruction thatthe ‘‘APA imposes no general obligation on


on women- and minority-broadcast owner-ship may remain difficult to uncover untilthe FCC gains experience with the newrules. See NCCB, 436 U.S. at 796–97, 98S.Ct. 2096; Council Tree Inv’rs, Inc. v.FCC, 619 F.3d 235, 252–53 (3d Cir. 2010).Faced with such a question, ‘‘complete fac-tual support in the record for the Commis-sion’s judgment or prediction is not possi-ble or required.’’ NCCB, 436 U.S. at 814,98 S.Ct. 2096. Under these circumstancessettled principles of administrative lawcounsel deference to the FCC’s prediction.3

Citizen Petitioners emphasize that theFCC acted on faulty minority-ownershipdata and no women-ownership data. See,e.g., Citizen Petitioners’ Br. 26–30. Thisdata, which the FCC acknowledged as im-perfect, measured minority ownership be-fore and after two prior regulatorychanges—in 1996 and 1999. Such dataweaknesses are not fatal to the FCC’sregulations—not only because, as noted,data gaps are inherent to predictive regu-lation, but also because it is not certain thedata demanded would alter the FCC’sanalysis. First, Citizen Petitioners assumethat the experience of these earlierchanges will speak directly to the effects ofthe Reconsideration Order. Even if theFCC could obtain improved data on thesedecades-old regulatory changes, that infor-mation offers only modest predictive valuefor the consequences of the FCC’s current

rules regarding modernization. Second, asnoted the FCC considers five types ofdiversity, not to mention competition andlocalism. The FCC’s lack of some datarelevant to one of these considerationsshould not outweigh its reasonable pre-dictive judgments, particularly in the ab-sence of any contrary information, suchthat its entire policy update is held up.

The FCC must ‘‘repeal or modify’’ rulesthat cease to serve the public interest evenwhen it lacks optimal data. Telecommuni-cations Act of 1996, § 202(h). The FCC hasrevised its Form 323 and conducted out-reach programs to ease compliance with itsreporting requirements. 2016 Report & Or-der ¶ 265. These are encouraging meas-ures that could make the FCC’s data morereliable, benefiting future quadrennial re-views. The FCC intends to take up a vari-ety of diversity-related proposals in its2018 quadrennial review. See 2018 Qua-drennial Regulatory Review—Review ofthe Commission’s Broadcast OwnershipRules and Other Rules Adopted Pursuantto Section 202 of the TelecommunicationsAct of 1996, Notice of Proposed Rulemak-ing, 33 FCC Rcd. 12111 ¶¶ 93–121 (2018). Iwould direct it to follow through on itsannouncement as well as study the effectsof the latest rules on ownership diversity. Iwould not, however, delay the Reconsider-ation Order based on the analytical short-comings Citizen Petitioners emphasize.

agencies to produce empirical evidence.’’Maj. Op. 587 (quoting 569 F.3d 514, 519(D.C. Cir. 2009)). But they argue Stilwell isdistinguishable because there the agency re-lied on its ‘‘long experience’’ supervising theindustry and did not act on ‘‘faulty and insub-stantial data’’ like the FCC did here. Id. Set-ting aside the FCC’s eight decades regulatingbroadcast media, the basic principle that theAPA ‘‘imposes no general obligation on agen-cies to produce empirical evidence’’ appliesregardless of the quality of the data in therecord. Stilwell, 569 F.3d at 519; see CouncilTree IV, 863 F.3d at 244 (‘‘[W]e review only

for the use of relevant, not perfect, data.’’).Were it otherwise, the principle would bemeaningless.

3. This is true despite Citizen Petitioners’ criti-cism of the FCC’s methodology and data. Notonly does the FCC have policymaking discre-tion, subject to the APA it also has discretion‘‘to proceed on the basis of imperfect scienti-fic information, rather than to invest the re-sources to conduct the perfect study.’’ Cablev-ision Sys. Corp. v. FCC, 649 F.3d 695, 717(D.C. Cir. 2011) (quoting Sierra Club v. EPA,167 F.3d 658, 662 (D.C. Cir. 1999)).


In short, I believe the FCC has ex-plained its decision. I would deny the peti-tions and allow the Reconsideration Or-der’s rule changes to take effect.

B.

My colleagues remand the 2016 Report& Order’s eligible entity definition for theFCC to ascertain what effect the revenue-based definition will have on women andminority ownership. But the FCC adoptedthe eligible entity definition to ‘‘serve thepublic interest by promoting small busi-ness participation in the broadcast indus-try and potential entry by new entrepre-neurs.’’ See 2016 Report & Order ¶ 279; seeid. ¶¶ 280–86. It thoroughly explained itspolicy choice. The record indicated that therevenue-based eligible entity definition willpromote the FCC’s ‘‘traditional policy ob-jectives TTT by enhancing opportunities forsmall business[es].’’ Id. ¶ 281. The FCC’sbrief experience with this definition con-firmed ‘‘a significant number of broadcastlicensees and permittees availed them-selves of policies based on the revenue-based eligible entity standard.’’ Id. ¶ 283(observing widespread use of the policyallowing certain eligible entities generousconstruction permits). No commenters ar-gued the revenue-based eligible entity def-inition does not serve the public interestaccording to the FCC’s analysis. Id. ¶ 276.

This stands in contrast to the last timethe FCC employed this definition. Duringits 2006 quadrennial review the FCCadopted a revenue-based eligibility entitydefinition to promote ownership diversity.The approach failed because the FCC pro-vided no support for why its definitionwould ‘‘be effective in creating new oppor-tunities for broadcast ownership by TTT

women and minorities.’’ Prometheus II,652 F.3d at 470 (internal quotation marksand citation omitted). The key distinction,of course, is the FCC’s policy decision to

reorient its eligible entity definition. Asrevised, it is intended to ‘‘encourage inno-vation and enhance viewpoint diversity’’ by‘‘promoting small business participation inthe broadcast industry.’’ 2016 Report &Order ¶ 235. Because the FCC pursuedthe revenue-based definition in past effortsto promote ownership diversity, it evident-ly believed the definition would not harmownership diversity. Nothing in the pres-ent record suggests otherwise. In my viewthe FCC properly complied with its obli-gations under the APA.

C.

Under today’s outcome, I regret that theFCC’s incubator program will not have anopportunity to stand or fall on its ownmerit. See Rules and Policies to PromoteNew Entry and Ownership Diversity inthe Broadcasting Services, 33 FCC Rcd.7911 (2018) (Incubator Order). Citizen Pe-titioners take issue with the program’s cri-teria for who is eligible to realize its bene-fits. The FCC adopted a two-prong eligibleentity definition: participants must be both‘‘new entrants’’ based on the number ofstations owned and ‘‘small businesses’’based on revenue. See id. ¶ 16. The FCCdesigned these criteria ‘‘to encourage newentry into’’ an ‘‘extremely capital-inten-sive’’ industry. Id. ¶ 18. The program’sbenefits will not exclusively accrue to mi-nority and women broadcasters as the eli-gibility criteria sweep in all emerging radiobroadcasters. This breadth is consistentwith the incubator program’s stated goal.Yet based on its review of data from incen-tive auctions, the FCC predicts that the‘‘new entrant’’ prong will likely benefitprospective women and minority appli-cants. Id. ¶¶ 21–24.

The incubator program is a reasonablepolicy designed to ‘‘support the entry ofnew and diverse voices into the broadcastindustry.’’ Id. ¶ 1. The FCC ‘‘has long

597NATIONAL COLLEGIATE ATHLETIC v. GOVERNOR OF NJCite as 939 F.3d 597 (3rd Cir. 2019)

contemplated the potential for’’ a programthat pairs emerging and experiencedbroadcasters to ease entry into radiobroadcasting. Id. ¶ 2. The Incubator Orderestablished the first program to convertthese ideas into a concrete policy. See ¶ 3.Before adopting the program, the FCCconsidered alternative eligibility criteriaand invited ‘‘comment on how to determineeligibility for participation in the incubatorprogram.’’ Id. ¶ 17; see id. ¶¶ 28–30 (de-clining to adopt competing proposals thatmight prove ‘‘administratively inefficient,’’and committing to ‘‘conduct outreach tohelp encourage participation in the incuba-tor program by mission-based entities andNative American Nations’’ that are eligi-ble). It then provided comprehensive rea-soning to justify the path it chose. See id.¶ 20 (‘‘The record reflects that individualsseeking to purchase their first or secondbroadcast station are the ones that oftenface the most challenging financial hur-dles.’’); id. ¶ 21 (citing incentive auctiondata showing definition could modestlybenefit women and minorities); id. ¶ 22(citing comments suggesting the same); id.¶ 25 & n.53 (noting that revenue cap nar-rows band of eligible entities); id. ¶ 27(‘‘Use of an objective standard has theadvantage of being straightforward andtransparent for potential applicants, aswell as administrable for the Commissionwithout application of significant additionalprocessing resources.’’). The FCC com-plied with the APA in determining its ‘‘eli-gible entity’’ definition. Its choice, in myview, is an aspect of program design large-ly left to the agency’s policy discretion,subject to the APA, TelecommunicationsAct of 1996, and other relevant statutes.The FCC’s order draws a rational linebetween the record and decision made, andI would allow the incubator program totake effect.

IV.

For the reasons provided, I would denythe petitions for review and allow theFCC’s orders to take effect.

,

NATIONAL COLLEGIATE ATHLETICASSOCIATION, an unincorporatedassociation; National Basketball As-sociation, a joint venture; NationalFootball League, an unincorporatedassociation; National Hockey League,an unincorporated association; Officeof the Commissioner of Baseball, anunincorporated association doingbusiness as Major League Baseball

v.

GOVERNOR OF the State of NEWJERSEY; David L. Rebuck, Directorof the New Jersey Division of GamingEnforcement and Assistant AttorneyGeneral of the State of New Jersey;*Judith A. Nason, Acting ExecutiveDirector of the New Jersey RacingCommission; New Jersey Thorough-bred Horsemen’s Association, Inc.;New Jersey Sports & Exposition Au-thority Stephen M. Sweeney, Presi-dent of the New Jersey Senate; *CraigJ. Coughlin, Speaker of the New Jer-sey Assembly (Intervenors in DistrictCourt)

New Jersey Thoroughbred Horsemen’sAssociation, Inc., Appellant

EXHIBIT B

UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT

_________________

Nos. 17-1107, 17-1109, 17-1110, 17-1111 _________________

PROMETHEUS RADIO PROJECT

*National Association of Broadcasters

**Cox Media Group LLC, Intervenors

v.

FEDERAL COMMUNICATIONS COMMISSION; UNITED STATES OF AMERICA

Prometheus Radio Project and Media Mobilizing Project, Petitioners in No. 17-1107

Multicultural Media, Telecom and Internet Counsel and National Association of Black Owned Broadcasters, Inc., Petitioners in 17-1109 The Scranton Times, L.P., Petitioners in 17-1110 Bonneville International Corporation, Petitioners in 17-111 * Prometheus Radio Project, Media Mobilizing Project, Benton Foundation, Common Cause, Media Alliance, Media Council Hawaii, National Association of Broadcasters Employees and Technicians Communications Workers of America, National Organization for Woman Foundation, Office of Communication of the United Church of Christ Inc., Intervenors

*(Pursuant to the Clerk’s Order date 1/18/17) ** (Pursuant to the Clerk’s Order dated 2/7/17)

_________________

Case: 18-3335 Document: 003113411693 Page: 1 Date Filed: 11/20/2019

2

Nos. 18-1092, 18-1669, 18-1670, 18-1671, 18-2943 & 18-3335 _________________

PROMETHEUS RADIO PROJECT; MEDIA MOBILIZING PROJECT,

Petitioners (No. 18-1092, 18-2943)

INDEPENDENT TELEVISION GROUP, Petitioners (No. 18-1669)

MULTICULTURAL MEDIA, TELECOM AND INTERNET COUNCIL, INC.; NATIONAL SSOCIATION OF BLACK-OWNED BROADCASTERS,

Petitioners (No. 18-1670, 18-3335)

FREE PRESS; OFFICE OF COMMUNICATION, INC. OF THE UNITED CHURCH OF CHRIST;

NATIONAL ASSOCIATION OF BROADCAST EMPLOYEES AND TECHNICIANS-COMMUNICATIONS WORKERS OF AMERICA;

COMMON CAUSE, Petitioners (No. 18-1671)

v.

FEDERAL COMMUNICATIONS COMMISSION; UNITED STATES OF AMERICA

_________________

On Petition for Review of An Order of

the Federal Communications Commission (FCC Nos. FCC-1: FCC-16-107; FCC-17-156; FCC-18-114)

_________________

Before: SMITH, Chief Judge, McKEE, AMBRO, CHAGARES, JORDAN, SHWARTZ, KRAUSE, RESTREPO, BIBAS, PORTER,

MATEY, PHIPPS, SCIRICA* and FUENTES* Circuit Judges

* Senior Judges Scirica and Fuentes are limited to panel rehearing only.


3

SUR PETITION FOR REHEARING

The petitions for rehearing filed by Respondents and Intervenors in support of

Respondents in the above-entitled cases having been submitted to the judges who

participated in the decision of this Court and to all the other available circuit judges of the

circuit in regular active service, and no judge who concurred in the decision having asked

for rehearing and a majority of the judges of the circuit in regular service not having

voted for rehearing, the petitions for rehearing by the panel and the Court en banc are

denied.

By the Court,

s/ Thomas L. Ambro, Circuit Judge Dated: November 20, 2019 MB/arr/cc: All Counsel of Record


Documents

103787163 1 Prometheus App for Further Extension...Jeetander T. Dulani Pillsbury Winthrop Shaw Pittman LLP 1200 17th St., N.W. Washington, D.C. 20036 (202) 663-8000 [email protected]