1. Where two applications pertaining to broadcasting station
licenses under the Federal Communications Act are mutually
exclusive, the grant of one without hearings on both deprives the
loser of the opportunity for a hearing to which he is entitled
under § 309(a) of the Act, even though his application is set for a
hearing at a later date. Pp.
326 U. S. 327,
326 U. S. 329,
326 U. S.
333.
2. In such a case, the applicant whose application was not acted
upon is placed in the same position as a newcomer who seeks to
displace an established broadcaster, and thus is placed under a
greater burden than if a hearing on his application had preceded
the grant of the other application. P.
326 U. S.
332.
3. While his statutory right to a hearing has been preserved in
form, it has been substantially nullified, as a practical matter,
by the grant of the other application. P.
326 U. S.
334.
Reversed.
Certiorari, 325 U.S. 846, to review dismissal of an appeal from
an order of the Federal Communications Commission dismissing a
petition for a hearing, rehearing, and other relief.
MR. JUSTICE DOUGLAS delivered the opinion of the Court.
The primary question in this case is whether an applicant for a
construction permit under the Federal Communications
Page 326 U. S. 328
Act, 48 Stat. 1064, 47 U.S.C. § 151, is granted the hearing to
which he is entitled by § 309(a) of the Act [
Footnote 1] where the Commission, having before it
two applications which are mutually exclusive, grants one without a
hearing and sets the other for hearing.
In March, 1944, the Fetzer Broadcasting Company filed with the
Commission an application for authority to construct a new
broadcasting station at Grand Rapids, Michigan, to operate on 1230
ke with 250 watts power, unlimited time. In May, 1944, before the
Fetzer application had been acted upon, petitioner filed an
application for authority to change the operating frequency of its
station WKBZ of Muskegon, Michigan, from 1490 ke with 250 watts
power, unlimited time, to 1230 ke. The Commission, after stating
that the simultaneous operation on 1230 ke at Grand Rapids and
Muskegon "would result in intolerable interference to both
applicants," declared that the two applications were "actually
exclusive." The Commission, upon an examination of the Fetzer
application and supporting data, granted it in June, 1944, without
a hearing. On the same day the Commission designated petitioner's
application for hearing. Petitioner thereupon filed a petition for
hearing, rehearing, and other relief directed against the grant of
the Fetzer application. The Commission denied this petition,
stating,
"The Commission has not denied petitioner's application. It has
designated the application for hearing as required by Section
309(a) of the Act. At this hearing, petitioner will have ample
opportunity to show that its operation as proposed will better
serve the public interest than will the grant of the Fetzer
application as authorized June 27, 1944. Such grant does not
preclude the Commission
Page 326 U. S. 329
at a later date from taking any action which it may find will
serve the public interest.
In re Berks Broadcasting
Company (WEEU), Reading, Pennsylvania, 8 FCC 427 (1941);
In re The Evening News Association (WWJ), Detroit,
Michigan, 8 FCC 552 (1941);
In re Merced Broadcasting
Company (KYOS), Merced, California, 9 FCC 118, 120
(1942)."
Petitioner filed a notice of appeal from the grant of the Fetzer
construction permit in the Court of Appeals for the District of
Columbia, asserting that it was a "person aggrieved or whose
interests are adversely affected" by the action of the Commission
within the meaning of § 402(b)(2) of the Act. [
Footnote 2] The Commission filed a motion to
dismiss the appeal for want of jurisdiction on the part of the
court to entertain it. This motion was granted without opinion. The
case is here on a petition for a writ of certiorari which we
granted because of the importance of the question presented.
Our chief problem is to reconcile two provisions of § 309(a)
where the Commission has before it mutually exclusive applications.
The first authorizes the Commission, "upon examination" of an
application for a station license, to grant it if the Commission
determines that "public interest, convenience, or necessity would
be served" by the grant. [
Footnote
3] The second provision of § 309(a) says that if, upon
examination of such an application, the
Page 326 U. S. 330
Commission does not reach such a decision,
"it shall notify the applicant thereof, shall fix and give
notice of a time and place for hearing thereon, and shall afford
such applicant an opportunity to be heard under such rules and
regulations as it may prescribe. [
Footnote 4]"
It is thus plain that § 309(a) not only gives the Commission
authority to grant licenses without a hearing, but also gives
applicants a right to a hearing before their applications are
denied. We do not think it is enough to say that the power of the
Commission to issue a license on a finding of public interest,
convenience, or necessity supports its grant of one of two mutually
exclusive applications without a hearing of the other. For, if the
grant of one effectively precludes the other, the statutory right
to a hearing which Congress has accorded applicants before denials
of their applications becomes an empty thing. We think that is the
case here.
The Commission, in its notice of hearing on petitioner's
application, stated that the application
"will not be granted by the Commission unless the issues listed
above are determined in favor of the applicant on the basis of a
record duly and properly made by means of a formal hearing."
One of the issues listed was the determination of "the extent of
any interference which would result from the simultaneous
operation" of petitioner's proposed station and Fetzer's station.
Since the Commission itself stated
Page 326 U. S. 331
that simultaneous operation of the two stations would result in
"intolerable interference" to both, it is apparent that petitioner
carries a burden which cannot be met. To place that burden on it
is, in effect, to make its hearing a rehearing on the grant of the
competitor's license, rather than a hearing on the merits of its
own application. That may satisfy the strict letter of the law, but
certainly not its spirit or intent. [
Footnote 5]
The Fetzer application was not conditionally granted pending
consideration of petitioner's application. Indeed, a stay of it
pending the outcome of this litigation was denied. Of course, the
Fetzer license, like any other license granted by the Commission,
was subject to certain conditions which the Act imposes as a matter
of law. We fully recognize that the Commission, as it said, is not
precluded "at a later date from taking any action which it may find
will serve the public interest." No licensee obtains any vested
interest in any frequency. [
Footnote 6] The Commission for,
Page 326 U. S. 332
specified reasons, may revoke any station license pursuant to
the procedure prescribed by § 312(a), and may suspend the license
of any operator on the grounds and in the manner specified by §
303(m). It may also modify a station license if, in its judgment,
"such action will promote the public interest, convenience, and
necessity, or the provisions of this chapter . . . will be more
fully complied with." § 312(b). And licenses for broadcasting
stations are limited to three years, the renewals being subject to
the same considerations and practice which affect the granting of
original applications. § 307(d). But, in all those instances, the
licensee is given an opportunity to be heard before final action
can be taken. [
Footnote 7] What
the Commission can do to Fetzer, it can do to any licensee. As the
Fetzer application has been granted, petitioner therefore is
presently in the same position as a newcomer who seeks to displace
an established broadcaster. By the grant of the Fetzer application,
petitioner has been placed under a greater burden than if its
hearing had been earlier. Legal theory is one thing. But the
practicalities are different. For we are told how difficult it is
for a newcomer to make the comparative showing necessary to
displace an established licensee.
Peoria Broadcasting Co. and
Illinois Broadcasting Co., 1 F.C.C. 167. No suggestion is made
here as in
Matheson Radio Co., Inc., 8 F.C.C. 427 or
The Evening News Association, 8 F.C.C. 552, that it may be
possible to make workable adjustments so that both applications can
be granted. The Commission concedes that "these applications are
actually exclusive." The applications are for a facility which can
be granted to only one. Since the facility has been granted to
Fetzer, the hearing accorded petitioner concerns a license
facility
Page 326 U. S. 333
no longer available for a grant unless the earlier grant is
recalled. A hearing designed as one for an available frequency
becomes, by the Commission's action, in substance one for the
revocation or modification of an outstanding license. So it would
seem that petitioner would carry as a matter of law the same burden
regardless of the precise provisions of the notice of hearing.
It is suggested that the Commission, by granting the Fetzer
application first, concluded that the public interest would be
furthered by making Fetzer's service available at the earliest
possible date. If so, that conclusion is only an inference from
what the Commission did. There is no suggestion, let alone a
finding, by the Commission that the demands of the public interest
were so urgent as to preclude the delay which would be occasioned
by a hearing.
The public, not some private interest, convenience, or necessity
governs the issuance of licenses under the Act. But we are not
concerned here with the merits. [
Footnote 8] This involves only a matter of procedure.
Congress has granted applicants a right to a hearing on their
applications for station licenses. [
Footnote 9] Whether that is wise policy, or whether the
procedure adopted by the Commission in this case is preferable, is
not for us to decide. We only hold that, where two
bona
fide applications are mutually exclusive, the grant of one
without a hearing to both deprives the loser of the opportunity
which Congress chose to give him.
In
Federal Communications Commission v. Sanders Bros. Radio
Station, 309 U. S. 470,
309 U. S. 476,
477, we held that a rival station which would suffer economic
injury by the grant
Page 326 U. S. 334
of a license to another station had standing to appeal under §
402(b)(2) of the Act. In
Federal Communications Commission v.
National Broadcasting Co., 319 U. S. 239, we
reached the same conclusion where an application had been granted
which would create such interference on the channel given an
existing licensee as in effect to modify the earlier license.
Petitioner is at least as adversely affected by the action of the
Commission in this case as were the protestants in those cases.
While the statutory right of petitioner to a hearing on its
application has in form been preserved, it has, as a practical
matter, been substantially nullified by the grant of the Fetzer
application. [
Footnote
10]
Reversed.
MR. JUSTICE BLACK and MR. JUSTICE JACKSON took no part in the
consideration or decision of this case.
[
Footnote 1]
Sec. 319 relates to applications for construction permits. But,
since such applications are, in substance, applications for station
licenses,
Goss v. Federal Radio Commission, 62 App.D.C.
301, 67 F.2d 507, 508, the Commission in such cases uniformly
follows the procedure prescribed in § 309(a) for station
licenses.
[
Footnote 2]
The relevant provisions of § 402(b) read as follows:
"An appeal may be taken, in the manner hereinafter provided,
from decisions of the Commission to the United States Court of
Appeals for the District of Columbia in any of the following
cases:"
"
* * * *"
"(2) By any other person aggrieved or whose interests are
adversely affected by any decision of the Commission granting or
refusing any such application."
[
Footnote 3]
Sec. 307(a) provides,
"The Commission, if public convenience, interest, or necessity
will be served thereby, subject to the limitations of this chapter,
shall grant to any applicant therefor a station license provided
for by this chapter."
[
Footnote 4]
Sec. 309(a) reads as follows:
"If, upon examination of any application for a station license
or for the renewal or modification of a station license, the
Commission shall determine that public interest, convenience, or
necessity would be served by the granting thereof, it shall
authorize the issuance, renewal, or modification thereof in
accordance with said finding. In the event the Commission, upon
examination of any such application, does not reach such decision
with respect thereto, it shall notify the applicant thereof, shall
fix and give notice of a time and place for hearing thereon, and
shall afford such applicant an opportunity to be heard under such
rules and regulations as it may prescribe."
[
Footnote 5]
The Commission recognizes in its regulations the desirability of
hearing such related matters at the same time or in consolidated
cases. By § 1.193, 47 Code Fed.Reg.Cum.Supp., it is provided:
"In fixing dates for hearings, the Commission will, so far as
practicable, endeavor to fix the same date for separate hearings
(a) on all related matters which involve the same applicant, or
arise out of the same complaint or cause, and (b) for separate
hearings on all applications which, by reason of the privileges,
terms, or conditions requested, present conflicting claims of the
same nature."
And, by § 1.194, 47 Code Fed.Reg.Cum.Supp., it is provided:
"The Commission, upon motion, or upon its own motion, will,
where such action will best conduce to the proper dispatch of
business and to the ends of justice, consolidate for hearing (a)
any cases which involve the same applicant or arise from the same
complaint or cause, or (b) any applications which, by reason of the
privileges, terms, or conditions requested, present conflicting
claims of the same nature."
[
Footnote 6]
See §§ 301, 304, 307(d), 309(b)(1) of the Act. "The
policy of the Act is clear that no person is to have anything in
the nature of a property right as a result of the granting of a
license."
Federal Communications Commission v. Sanders Bros.
Radio Station, 309 U. S. 470,
309 U. S.
475.
[
Footnote 7]
For the regulations of the Commission governing these
procedures,
see 47 Code Fed.Reg.Cum.Supp. § 1.401
(revocation), § 1.359 and § 1.402 (modification), § 1.411 and §
1.412 (suspension), § 1.360 (renewal).
[
Footnote 8]
See Federal Communications Commission v. Pottsville
Broadcasting Co., 309 U. S. 134,
309 U. S.
145-146.
[
Footnote 9]
Apparently no regulation exists which, for orderly
administration, requires an application for a frequency, previously
applied for, to be filed within a certain date. Nor is there any
suggestion that petitioner's application, which was filed shortly
after Fetzer's, was not filed in good faith.
[
Footnote 10]
A license to operate a station is required in addition to a
permit to construct one. As respects an operating license, § 319(b)
provides:
"Upon the completion of any station for the construction or
continued construction of which a permit has been granted, and upon
its being made to appear to the Commission that all the terms,
conditions, and obligations set forth in the application and permit
have been fully met, and that no cause or circumstance arising or
first coming to the knowledge of the Commission since the granting
of the permit would, in the judgment of the Commission, make the
operation of such station against the public interest, the
Commission shall issue a license to the lawful holder of said
permit for the operation of said station. Said license shall
conform generally to the terms of said permit."
For the regulations of the Commission governing such
applications,
see 47 Code Fed.Reg.Cum.Supp. § 1.357. It
was conceded on oral argument that, in that proceeding, petitioner
would not be entitled to intervene to challenge the propriety of
the grant of the construction permit to Fetzer without a hearing on
petitioner's application.
MR. JUSTICE FRANKFURTER, dissenting.
The extent to which administrative agencies are to be entrusted
with the enforcement of federal legislation is
Page 326 U. S. 335
for Congress to determine. Insofar as the actions of these
agencies come under the scrutiny of judicial review, it is the
business of the courts to respect the distribution of authority
that Congress makes as between administrative and judicial
tribunals. Of course, courts must hold the administrative agencies
within the confines of their Congressional authority. But, in doing
so, they should not even unwittingly assume that the familiar is
the necessary, and demand of the administrative process observance
of conventional judicial procedures when Congress has made no such
exaction. Since these agencies deal largely with the vindication of
public interest, and not the enforcement of private rights, this
Court ought not to imply hampering restrictions, not imposed by
Congress, upon the effectiveness of the administrative process. One
reason for the expansion of administrative agencies has been the
recognition that procedures appropriate for the adjudication of
private rights in the courts may be inappropriate for the kind of
determinations which administrative agencies are called upon to
make.
The disposition of the present case seems to me to disregard
these controlling considerations, if the Court now holds, as I
understand it so to do, that, whenever conflicting applications are
made for a radio license, the Communications Commission must hear
all the applications together.
In the regulation of broadcasting, Congress moved outside the
framework of protected property rights.
See Federal
Communications Commission v. Sanders Bros. Radio Station,
309 U. S. 470.
Congress could have retained for itself the granting or denial of
the use of the air for broadcasting purposes, and it could have
granted individual licenses by individual enactments as, in the
past, it gave river and harbor rights in individuals. Instead of
making such a crude use of its Constitutional powers, Congress, by
the Communications Act of 1934, 48 Stat. 1064, 47 U.S.C. § 151,
formulated
Page 326 U. S. 336
an elaborate licensing scheme and established the Federal
Communications Commission as its agency for enforcement. Our task
is to give effect to this legislation and to the authority which
Congress has seen fit to repose in the Communications
Commission.
To come to the immediate issue, what has the Commission done
that is here challenged, and what authority from Congress does it
avouch for what it has done?
The Commission had before it at least two applications for the
use of the same radio wavelength in the Western Michigan area
(Muskegon-Grand Rapids) -- that of the petitioner and Fetzer's. The
problem before the Commission was the procedure appropriate in
acting upon these two applications. Congress has authorized the
Commission to grant an application without resort to a public
hearing, 47 U.S.C. §§ 309(a), 319(a), but a public hearing may be
demanded when the Commission denies an application, 47 U.S.C. §
309(a). The Court in effect rules that, in the case of multiple
applications, the Commission can decide only after a public hearing
on all of them. This requirement is apparently derived from the
assumption that, in this case, the Commission, having received two
conflicting applications, shut off, out of hand and quite
arbitrarily, petitioner's right to have its application considered,
as, of course, the Commission is in duty bound to consider it, by
granting Fetzer's. But that is not what happened. The Commission is
charged with the ascertainment of the public interest. We must
assume that an agency which Congress has trusted discharges its
trust. On the record before us, it must be accepted that the
Commission, before having taken action, carefully tested, according
to its established practice, the claims both of Fetzer and of
petitioner by the touchstone of public interest.
See
Attorney General's Committee on Administrative Procedure, Monograph
No. 3, The Federal Communications Commission (1940) 8
et
seq. On
Page 326 U. S. 337
the basis of such inquiry, it found that the Fetzer application
was clearly in the public interest; it found that the Ashbacker
application did not make a sufficient showing even to stay the
Commission's hand in withholding the Fetzer grant long enough to
enable Ashbacker to support its application more persuasively. On
the contrary, it thought the public interest would be furthered by
making Fetzer's service available at the earliest possible date.
There is nothing in the Communications Act that restricts the
Commission in translating its duty to further the public interest
as it did in the particular situation before it. In granting
Fetzer's application and setting the denial of the petitioner's
down for a hearing after fully canvassing the situation, the
Commission brought itself within the explicit provisions of the
Communications Act, and applied them with that flexibility of
procedure which Congress has put into the Commission's own keeping.
Federal Communications Commission v. Pottsville Broadcasting
Co., 309 U. S. 134,
309 U. S.
138.
But it is suggested that the right to a hearing upon denial of
an application is not satisfied by a hearing bound to be barren. In
order to appreciate the function of a hearing under the statute in
a situation like that, before us, however, it is vital to remember
that the two applications of petitioner's and Fetzer's are very
different from an ordinary litigation between Fetzer and petitioner
in a court of law. Each of them was before the Commission as the
representative of the public interest, the ascertainment of which
is the expert function of the Communications Commission. It bears
repeating that the application of both presumably received careful
scrutiny by the Commission before action was taken. Administrative
practice indicates that, where there are conflicting applications,
the Commission has granted some without hearing where it thought
the public interest best served by that procedure, while setting
others for hearing where the public
Page 326 U. S. 338
interest so demanded. [
Footnote
2/1] Fetzer made a clear showing to the agency designated for
the purpose by Congress that the public interest would be served by
the grant of its application. The same agency found no basis in
public interest for Ashbacker's application. Certainly it is wholly
consonant with the scheme of the legislation and the powers given
to the Commission that, upon denial of the Ashbacker application
after a finding that it would not, and Fetzer would, serve the
public interest, the burden be cast on Ashbacker to show that it
would serve the public interest better than would Fetzer. The
Commission is authorized by statute to modify a construction permit
or any license granted by it. [
Footnote
2/2] This gives considerable scope for adjusting the prior
grant to Fetzer so as to give to the public the benefits of
reconciling both the Fetzer and the Ashbacker applications, if the
hearing should develop considerations not disclosed by the prior
scrutiny of the Commission. Not only that, but the Commission, in
its opinion on hearing the Ashbacker complaint, construed its own
action in granting the Fetzer application to be conditional, so as
to have room for any action which it may find will serve the public
interest after the hearing on the Ashbacker
Page 326 U. S. 339
application. Such a practice of conditional grant by the
Commission ought not to be deemed outside the range of the
procedural discretion allowed to it by Congress. [
Footnote 2/3]
In this case, however, the restrictions of the hearing granted
to Ashbacker do make of it a mere formality, for the Commission put
upon Ashbacker the burden of establishing that the grant of a
license to it would not interfere with the simultaneous operations
of the proposed Fetzer station. But, since the Commission had
apparently already concluded that the simultaneous operation of the
two stations would result in "intolerable interference," its order
for a hearing seems to foreclose the opportunity that should still
be open to Ashbacker. It is entitled to show the superiority of its
claim over that of Fetzer even though the Commission, on the basis
of its administrative inquiry, was entitled to grant Fetzer the
license in the qualified way in which the statute authorized, and
the Commission made, the grant. In my view, therefore, the proper
disposition of the case is to return it to the Commission with
direction that it modify its order so as to assure an appropriate
hearing of the Ashbacker application. It may be wise policy to
require that the Communications Commission should give a public
hearing for all multiple applications before granting any. But, to
my reading of the Communications Act, Congress has not expressed
this policy.
MR. JUSTICE RUTLEDGE joins in this opinion.
[
Footnote 2/1]
Conflicting Applications
Total No. of No. Granted No. Granted
Fiscal Applications Without After
Year Considered Number Hearing Hearing
1941 . . . . 159 49 14 2
1942 . . . . 142 52 1 2
1943 . . . . 23 5 0 1
1944 . . . . 39 14 2 1
1945 . . . . 114 69 5 8
[
Footnote 2/2]
Sec. 312(b):
"Any station license hereafter granted under the provisions of
this Act or the construction permit required hereby and hereafter
issued may be modified by the Commission either for a limited time
or for the duration of the term thereof, if, in the judgment of the
Commission, such action will promote the public interest,
convenience, and necessity or the provisions of this Act or of any
treaty ratified by the United States will be more fully complied
with. . . ."
Cf. 47 Code Fed.Reg. § 1.402.
[
Footnote 2/3]
Cf. Berks Broadcasting Company (WEEU), Reading,
Pennsylvania, 8 F.C.C. 427;
The Evening News Association
(WWJ), Detroit, Michigan, 8 F.C.C. 552;
Merced Broadcasting
Company (KYOS), Merced, California, 9 F.C.C. 118, 120.