Charter Seeks Santa Cruz Appeal

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Charter Communications Inc. is waiting to see if the U.S. Court of Appeals for the Ninth Circuit in San Francisco will reconsider its decision upholding Santa Cruz County's denial of transfer.

The cable operator has petitioned for an en banc hearing — that is, a hearing before all of the courts' judges — of a Sept. 20 ruling by the appeals court. Attorneys for the operator argue the court was in "clear error of law" when it handed a franchise dispute victory to the local franchising authority.

The central California coastal county declined a transfer of ownership from Sonic Communications to Charter in 1997. The action was based on community concerns that Charter had paid so much for the 5,000-subscriber system that the new owner would be forced to raise rates to consumers to recover its investment.

Charter's petition, filed earlier this month, asserts the panel was in error because it did not acknowledge federal Cable Act timetables in its decision. Federal policy requires that cities act on transfer requests within 120 days and puts caps on franchise and other fees at 5 percent of gross revenue.

The operator has argued that the county's actions violated these standards. Charter refused to comply with demands that violated the Act — such as requiring a "processing" fee to compensate bureaucrats for the paperwork involved in examining Charter's transfer application — which lead to the denial, the company claimed.

Attorneys for the company also challenge court assertions that Charter "knowingly and voluntarily" waived its First Amendment rights when it entered its franchise agreement in Santa Cruz.

The court was wrong in relying on county counsel's word that assertions made during court arguments were factual, Charter's petition said.

A court clerk said the panel must gather to vote on whether to take en-banc petitions and that process, once begun, could take several days.

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