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Court Nixes New FCC Media-Ownership Rules

6/24/2004 9:12 AM Eastern

New media-ownership rules adopted last June by the Federal Communications Commission were overturned Thursday by a panel of the U.S. Court of Appeals for the Third Circuit in Philadelphia in a ruling that public-interest groups hailed as a victory over big-media consolidation.

FCC chairman Michael Powell -- who pushed for relaxing the ownership rules despite strong special-interest and political opposition -- complained that the court ruling would make it harder for the agency to place numerical limits on media ownership.

“Today's decision perversely may make it dramatically more difficult for the [FCC] to protect against greater media consolidation. It sets near-impossible standards for justifying bright-line ownership limits,” Powell said.

Last June, the Republican-controlled FCC voted 3-2 along party lines to make it easier for one company to accumulate newspapers, TV stations and radio stations in the same market. But critics argued that the commission simply abetted media consolidation at the expense of the public interest.

“This is a vindication for the vast majority of the American public who opposed these rule changes. The court largely undid what would have been the most destructive rollback of media-ownership protections in the history of American broadcasting,” FCC Democrat Jonathan Adelstein said.

The FCC’s new rules never took effect because the Third Circuit froze them in place one day before they would have become law. In the decision Thursday, the court continued the freeze while the agency crafts new rules consistent with its opinion.

At some point, the FCC can appeal the decision to the U.S. Supreme Court.

“We will thoroughly study this voluminous opinion and consider carefully our next steps,” Powell said.

The court ruling did not disturb the FCC’s decision to eliminate a rule that effectively banned the common ownership of a cable system and a TV station in the same local market.

Elimination of that rule made it possible for Comcast Corp. to make a run at The Walt Disney Co., which owns 10 TV stations, including a few in some big Comcast markets.

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