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KERM, Inc. v. Federal Communications Commission

January 09, 2004


On Petition for Review of an Order of the Federal Communications Commission

Before: Edwards, Sentelle, and Tatel, Circuit Judges.

The opinion of the court was delivered by: Edwards, Circuit Judge

Argued December 5, 2003

Petitioner KERM, Inc. ("KERM") filed a complaint with the Federal Communications Commission ("FCC" or "Commission") alleging that radio station KAYH-FM ("KAYH") unlawfully aired 11 announcements that constituted commercial advertisements in violation of the Communications Act of 1934. The Commission found that 10 of the 11 announcements did not violate the Act. The Commission further held that no enforcement action was warranted with respect to the single remaining announcement that was found to be an impermissible advertisement. KERM seeks review of the Commission's decision.

We hold that KERM lacks standing under Article III to pursue this petition for review. KERM cannot establish standing as a listener of KAYH, because KERM alleges only a discrete, past violation of the Act. Nor can KERM demonstrate standing as a competitor of KAYH, because it has not indicated how, if at all, it has suffered any competitive injury as a result of that violation. Indeed, KERM alleges no particularized injury whatsoever, short of a generalized interest in the faithful enforcement of the law. We therefore dismiss the petition for review.


The Communications Act of 1934 ("Act") prohibits noncommercial educational broadcast stations from broadcasting "advertisements." 47 U.S.C. § 399b(b)(2) (2000). The Act defines prohibited advertisements as program material that is broadcast "in exchange for any remuneration" and "intended to promote any service, facility, or product" of for-profit entities. 47 U.S.C. § 399b(a). So long as they do not constitute advertisements, however, a noncommercial educational broadcast station may broadcast acknowledgments of donors or underwriters. Such acknowledgments may identify, but not promote, the contributor's products, services, or business. See Tri-State Inspirational Broad. Corp., 16 F.C.C.R. 16,800, 16,800 (2001). The Commission has articulated in various rules and orders specific guidelines regarding the difference between permissible underwriter announcements and impermissible commercial advertisements. See generally Comm'n Policy Concerning the Noncommercial Nature of Educ. Broad. Stations, 7 F.C.C.R. 827 (1992).

KAYH, operated by Family Vision Ministries, Inc. ("Family Vision"), is a noncommercial educational broadcast radio station located in Fayetteville, Arkansas. Petitioner KERM is the licensee and operator of several commercial radio broadcast stations in Arkansas whose listening audiences overlap with that of KAYH. On October 9, 2001, KERM filed a formal complaint with the Commission asserting that KAYH had aired 11 underwriter announcements during an August 30, 2001, football game that constituted impermissible commercial advertisements in violation of the Act. See Appendix ("App.") 1-5. KERM requested that the Commission conduct an investigation and impose a forfeiture on Family Vision in the amount of $2,000 per violation. App. 5.

Upon consideration of KERM's complaint, the FCC's Enforcement Bureau ("Bureau") ruled that 10 of the 11 disputed announcements did not violate the Act. See Family Vision Ministries, Inc., EB-01-IH-0629-KMS (May 15, 2002) (letter ruling), reprinted in App. 12-13. Although one announcement was found to constitute a prohibited advertisement, the Bureau concluded that no enforcement action was warranted because the single violation was an "isolated occurrence." App. 13. KERM filed an application for review before the Commission, arguing that the Bureau's ruling was arbitrary and capricious and contrary to the Act, case law, and Commission regulations. Family Vision filed an opposition to KERM's application for review, in which it stated that, immediately after the disputed announcements aired, it had replaced the announcements and instituted new review procedures to ensure compliance with the Act. See App. 27-28. The Commission denied KERM's application for review. See Family Vision Ministries, Inc., 18 F.C.C.R. 1418 (2003), reprinted in App. 46-48. Specifically, the Commission agreed with the Bureau that 10 of the 11 announcements were permissible under the Act and that the remaining violation did not warrant the imposition of any sanction. Id. at 1419, App. 47. KERM filed this petition for review.


KERM lacks standing under Article III to challenge the Commission's order. We therefore dismiss the petition for review. To establish standing under Article III, a petitioner must demonstrate (1) an injury in fact that is (2) fairly traceable to the challenged action and (3) likely to be redressed by the requested relief. See Steel Co. v. Citizens for a Better Env't, 523 U.S. 83, 102-03 (1998); Jaramillo v. FCC, 162 F.3d 675, 676 (D.C. Cir. 1998). That a petitioner participated in administrative proceedings before an agency does not establish that the petitioner has constitutional standing to challenge those proceedings in federal court. See Fund Democracy, LLC v. SEC, 278 F.3d 21, 27 (D.C. Cir. 2002). Where a petitioner is not subject to the administrative decision it challenges, courts are particularly disinclined to find that the requirements of standing are satisfied. Branton v. FCC, 993 F.2d 906, 910-11 (D.C. Cir. 1993); see also Steel Co., 523 U.S. at 107; Linda R.S. v. Richard D., 410 U.S. 614, 619 (1973) ("[A] citizen lacks standing to contest the policies of the prosecuting authority when he himself is neither prosecuted nor threatened with prosecution.").

A petitioner bears the burden of establishing its standing. Steel Co., 523 U.S. at 104. Under Sierra Club v. EPA, 292 F.3d 895 (D.C. Cir. 2002), we require petitioners whose standing is not self-evident to establish standing by the submission of affidavits or other evidence "at the first appropriate point in the review proceeding." Id. at 900. Where no motion to dismiss has been made, the petitioner's first opportunity will be its opening brief, not its reply brief. Id. Although KERM was reminded of this obligation in the court's order establishing the briefing schedule for this case, see KERM, Inc. v. FCC, No. 03-1028 (D.C. Cir. Jun. 30, 2003), reprinted in App. 49, KERM nonetheless failed to offer anything in its opening brief to support standing. In response to the FCC's brief, KERM belatedly asserted standing in its reply brief. But, even there, KERM offered nothing concrete to establish Article III standing.

KERM has provided no explanation for its failure to comply with Sierra Club. Even were we to excuse this oversight on the tenuous assumption that KERM reasonably failed to comprehend that standing was far from self-evident, there is nothing in the record of this case to indicate that KERM satisfies the requirements of Article III. Neither the record of administrative proceedings nor KERM's briefs before this court even assert that KERM has suffered any particularized injury.

KERM describes itself as a "listener" and "competitor" of KAYH, suggesting that it has standing on these bases. There is no doubt that both listeners and competitors may, in appropriate cases, demonstrate standing to challenge actions of the FCC under the Communications Act. See New World Radio, Inc. v. FCC, 294 F.3d 164, 170 (D.C. Cir. 2002) (competitor standing); Huddy v. FCC, 236 F.3d 720, 722 (D.C. Cir. 2001) (listener ...

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