Courts

Court: Comcast Can’t Challenge PEG Requirements

8/24/2004 7:58 AM Eastern

Comcast Corp. can’t challenge local PEG-access (public, educational and government) requirements it considers onerous until after those franchise demands have actually been formalized by a city, according to a federal count ruling Monday.

U.S. District Magistrate Judge Richard Seeborg dismissed the challenge by the operator against San Jose, Calif. Comcast filed suit last year, alleging that a preliminary denial of its franchise renewal in the Silicon Valley city violated state and federal law.

But the judge found that the city is taking all of the steps required of the federal Cable Act in its formal renewal process. A challenge to the city action would only be appropriate after the process is concluded, the judge said. The damage Comcast claims now is only speculative, according to the judge.

The case has been closely watched by local regulators, who see it as a major salvo by Comcast to eliminate PEG and institutional-network requirements from future renewals. Officials believe the cable company wants to reclaim that network real estate for profitable advanced services while relegating local programming to the video-on-demand queue.

Comcast noted in its complaint that pending access and I-net demands have a “chilling effect” on the company’s programming plans, but the judge did not accept the company’s argument.

As part of the renewal process, the previous owner, AT&T Broadband, submitted a formal proposal for renewal in September 2002 that the city said did not contain all of the information required by San Jose.

Then AT&T merged with Comcast, and the newly conformed company asked the city to delay franchise action.

San Jose issued a preliminary denial in January 2003, but the city agreed to begin an administrative hearing, as required by federal law. In the midst of that process, Comcast filed suit, claiming that the city action violated its First and 14th Amendment rights, as well as the Cable Act.

Judge Seeborg previously eliminated the First Amendment claim in a September 2003 ruling on a preliminary injunction request by the operator.

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