Prometheus Radio Project v. FCC

Prometheus Radio Project v. FCC, was a series of cases heard and adjudicated by the U.S. Third Circuit Court of Appeals from 2003 to 2010. A civilian activist group, Prometheus Radio Project, challenged new media ownership rules put forth by the Federal Communications Commission (FCC) during its 2002 Biennial Review. The majority ruled 2-1 to throw out the attempt by the FCC to raise the limits of cross-ownership of media, and determined that a "diversity index" used by the FCC to weigh cross-ownership (of radio, television and newspapers) employed several "irrational assumptions and inconsistencies." Many elements were remanded to be fixed or better explained to assure they were in the public interest. The dissenting opinion by Chief Judge Anthony Joseph Scirica contested that the majority were simply employing their own assumptions, and that the FCC should be allowed to use its mandated expertise and make adjustments as necessary. The Court also ruled that section 202 (h) of the Telecommunications Act of 1996 did not contain a “deregulatory presumption,” and that the burden rested with those seeking to modify or eliminate the existing rules.

The FCC was ordered to reconfigure how it justifies raising ownership limits, and after the Supreme Court later turned down an appeal, the decision stood. In 2010, the Third Circuit Court of Appeals revisited the case once again, following changes made by the FCC, and lifted the stay of the new rules, allowing the agency to move forward with increases in media-ownership limits.

As required by changes made in the Telecommunications Act of 1996, the FCC undertook its 2002 biennial review of current media ownership rules. During this evaluation, followed by publication in the 2003 Report and Order, the FCC decided to amend the current set of rules. Under Chairman Michael Powell, the Commission sought to significantly relax media ownership regulations. The two main priorities of localism and diversity were retained.

The FCC decided to eliminate the two separate limits on ownership of different media outlets in local markets, and replace them with one multi-tiered rule. Considering the old rule prohibiting common ownership of a broadcast television station and a newspaper in the same market, and the rule limiting the amount of television and radio station cross-ownership depending on the size of the market, the FCC instituted a new three tier cross-ownership rule. In small markets, cross-ownership is prohibited. In mid-sized markets an entity can own a newspaper and either (a) one television station and 50% of radio stations, or (b) up to 100% of the radio stations. In large markets, cross ownership is unrestricted.

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