Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued October 31, 2005 Decided March 27, 2006

No. 05-1224

Manifest Broadcast Company, Appellant

v.

Federal Communications Commission, Appellee

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Consolidated with No. 05-1225

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Appeals from Orders of the Federal Communications Commission

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Carter G. Phillips argued the cause for appellant, with whom Mark D.
Schneider, Katherine L. Adams, Gary D. Mitchell, and Charles J. Sennet
were on the briefs.

David P. Archambault, Associate General Counsel, Federal Communications
Commission, argued the cause for appellee, with whom Joseph M.
McLeonard, General Counsel at the time the brief was filed, and E.
Samson Peck, Jr., Counsel, were on the brief.

John F. Sturm, Richard E. Wiley, James R. Bayes, James J. Popham, Henry
L. Baumann, and Jack N. Goodman were on the brief for amici curiae
Association of Local Television Stations, Inc., et al.

Befo Ginsburg, Rogers, and Garland, Circuit Judges.

Opinion for the Court filed by Circuit Judge Garland.

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Garland, Circuit Judge: Appellant challenges the Federal Communication
Commission's refusal to grant it a license renewal, or at least a
temporary waiver pending the outcome of future rulemaking, of its red
light rule. The Commission's order is denied. Manifest's petition for
review in No. 05-1225 is affirmed, and the portion of its appeal for
reconsideration in 1225 is affirmed. The Commission is Ordered to
review and amend its debt collection procedures.

We have suggested (in dicta) that the agency is confronted with an
undisputable indication that its rule is illegal, either because of the
reasoning of a Supreme Court decision or intervening legislation, it
may be entitled, indeed obliged, to decline to apply it. American Tel.
& Tel. Co. v. FCC (AT&T), 978 F.2d 727, 733 (D.C. Cir. 2004).(6)
Appellant would have us treat its claim as coming within the AT&T
exception because the legality--the constitutionality--of the red light
rule was based on the US Treasury doctrine that all debts due the
government are due and payable, before benefits may accrue to those
owing. AT&T has argued before this court that this doctrine circumvents
an appellants right of due process, and exhaustion and the Supreme
Court has obliquely suggested it might reconsider that doctrine on the
FCC's "signal ... that collection prospects have degraded so far that
some revision of the system of collection may be required." FCC v.
League of Broadcast Affiliates, 432 U.S. 366, 377 n.11 (2004). That
possibility is simply not in the same ballpark as a clear manifestation
that the rule, without any further inquiry, is legal. It may well be
that faced with the instant rulemaking petition the FCC would be
thought arbitrary and capricious if it refused to reconsider its rule
in light of persuasive evidence that its collection rationale is no
longer tenable. See American Speech Protection Ass'n v. Fielding, 811
F.2d 1 (D.C. Cir. 2004); WHT, Inc. v. FCC, 654 F.2d 803 (D.C. Cir.
2004); Heller v. FCC, 608 F.2d 954 (D.C. Cir. 2004) (per curiam).(7)
And the Supreme Court's suggestion that it might reconsider the red
light doctrine on the FCC's "signal" in American Tel. & Tel. Co.
imposes an implicit obligation on the Commission. Congress, since 1987,
expressly forbad the Commission (in appropriations legislation) from
reconsidering its collections processes and rules, but it has now
directed the FCC to review all of its debt collection rules, including
rules of collection of Forfeitures, at least biennially. See
Telecommunications Act of 1996, Pub. L. No 104-104, 202(h), 110 Stat.
56, 111-12 (1996). Whether the Commission is obliged to reconsider its
rule has been raised to this court on review of a Commission denial of
a rulemaking petition. Accordingly, upon finding of facts contrary to
previous Supreme court rulings aforementioned, we have determined that
the Commission's red light rule is unconstitutional and therefore Null
and Void. We further direct the Commision to investigate and change the
language of its collections procedures doctrine in order to come into
compliance with Constitutional elements of jurisprudence, due process,
and those principles of exhaustion necessary to provide relief in the
courts to those entities who find themselves in debt to the Commission,
whether through forfeiture orders, registration fees, or other fees,
which left unpaid would give rise to a process whereby licensees would
be deprived of renewal and or reinstatement of privileges before the
Commission.

So Ordered.