United States v. Any & All Radio Station Transmission Equipment

United States Court of Appeals

FOR THE EIGHTH CIRCUIT
_____________

No. 97-3972
_____________

United States of America, *
*
Plaintiff-Appellee, *
*
v. *
*
Any and all Radio Station *
Transmission Equipment; Radio *
Frequency Power Amplifiers, *
Radio Frequency Test Equipment, *
and any other equipment associated *
with or used in connection with the * Appeal from the United States
transmission at 97.7 MHZ, located * District Court for the
AT 1400 Laurel Avenue, Apartment * District of Minnesota
1109, Minneapolis, MN 55403, *
*
Defendants. *
*
Alan Fried, *
*
Claimant-Appellant, *
_____________________________ *
National Association of Broadcasters, *
*
Amicus on Behalf of Appellee. *
*
____________

Submitted: October 19,1999
Filed: March 27, 2000
 ____________

Before McMILLIAN, NOONAN1 and MORRIS SHEPPARD ARNOLD,
Circuit Judges

____________

NOONAN, Circuit Judge.

Alan Fried appeals from a final order entered in the United States District

Court2 for the District of Minnesota granting judgment on the pleadings in favor of

the United States, pursuant to Fed. R. Civ. P. 12(c), in its action for in rem forfeiture

of certain radio equipment pursuant to the Communications Act of 1934, as

amended, 47 U.S.C. § 510. United States v. Any & All Radio Station Transmission

Equipment, 976 F. Supp. 1255 (D. Minn. 1997).

The government asserted that the district court had jurisdiction over the in

rem forfeiture action pursuant to 28 U.S.C. §§ 1345 (United States as plaintiff),

1355 (action for forfeiture under any Act of Congress). We have appellate

jurisdiction over the district court’s final order pursuant to 28 U.S.C. § 1291. The

1
The Honorable John T. Noonan, United States Circuit Judge for the Ninth
Circuit, sitting by designation.

2
The Honorable Michael J. Davis, United States District Judge for the District
of Minnesota.

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notice of appeal was timely filed pursuant to Fed. R. App. P. 4(a).

For reversal, Fried argues the district court erred in holding that it lacked

subject matter jurisdiction to adjudicate his constitutional affirmative defenses. For

the reasons discussed below, we hold that the district court has jurisdiction to

adjudicate the in rem forfeiture action, but not jurisdiction to hear Fried’s

constitutional challenges to the microbroadcasting regulations. Accordingly we

affirm the judgment of the district court.

BACKGROUND FACTS

Most of the facts are not disputed, and the following statement of facts is

taken in large part from the district court’s memorandum opinion and order.

This in rem forfeiture action involves the seizure of certain radio equipment

owned and used by Fried to operate BEAT, an unlicensed radio station, out of his

apartment in downtown Minneapolis. BEAT broadcast at a level of about 20 watts,

at a frequency of 97.7 MHZ, in an area with a radius of about 6 miles from Friend’s

apartment. According to Fried, BEAT’s broadcast signal did not interfere with any

other radio stations.

Fried is a “microbroadcaster.” Microbroadcasters operate low-wattage radio

stations without licensing approval from the FCC. Microbroadcasters generally use

1 to 95 watts of power to broadcast their FM radio signals. (Extremely low-wattage

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broadcasts do not need to be licensed by the FCC. See 47 C.F.R. § 15.239(b)

(emissions which do not exceed 250 microvolts/meter at 3 meters as measured by

average detectors).) At the present time FCC regulations bar issuing licenses to

microbroadcasters, that is, any radio station broadcasting below 100 watts. See 47

C.F.C. § 73.211(a), .511(a), .512(c) (beginning in 1978, FCC refused to issue all

future licenses for broadcasting below 100-watts, except in Alaska). It can cost

more than $100,000 for a broadcast license for a 100-watt station. Broadcasting

without an FCC license is a violation of federal law. 47 U.S.C. § 301. The FCC

estimates that there are between 300 to 1,000 unlicensed, low-wattage radio stations

broadcasting diverse programs ranging from Christian sermons to rock ‘n roll to

call-in discussions nationwide. Microbroadcasters generally view themselves as

part of a free speech movement and as community broadcasters; they typically

spend their air time talking about topics such as the evils of income tax and

government regulation, reading poetry, playing “alternative” music, and expressing

political points of view on many subjects.

This litigation began in July 1996, when the FCC received a complaint from a

FM radio station in Rochester, MN, about an unlicensed station broadcasting on

97.7 MHZ. FCC agents investigated and confirmed unauthorized radio

transmissions from Fried’s apartment. In August 1996 the FCC mailed a warning

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letter to Fried, informing him that broadcasting unauthorized radio transmissions

was unlawful in violation of 47 U.S.C. § 301, ordered him to respond to the warning

letter within 10 days, and demanded that he cease operations immediately. Title 47

U.S.C. § 301 provides in part that “[n]o person shall use or operate any apparatus

for the transmission of . . . signals by radio . . . except under and in accordance with

[the Federal Communications Act] and with a license in that behalf granted under

the provisions of this chapter.” Persons who willfully and knowingly intend to

violate the licensing requirement may have their equipment or devices seized and

forfeited to the United States. Id. § 510(a).

Fried responded to the warning letter by challenging the constitutionality of

the microbroadcasting regulations and requesting a waiver of the FCC licensing

requirement, but he did not cease operation of BEAT.

PROCEEDINGS IN DISTRICT COURT

The government brought this in rem forfeiture action in federal district court.

The in rem forfeiture complaint asserted that the district court had jurisdiction under

28 U.S.C. §§ 1345, 1355, and 47 U.S.C. § 510. In October 1996, after hearing, the

federal magistrate judge3 issued a warrant of arrest and notice in rem commanding

3
The Honorable John M. Mason, United States Magistrate Judge for the
District of Minnesota.

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the United States marshal to “arrest” the radio equipment used to operate the

unlicensed radio station. The government gave notice of the arrest by personal

service on Fried and his attorney and by publication. The United States marshal

executed the warrant and seized the radio equipment in early November 1996.

Fried filed a claim of ownership of the seized radio equipment and sought

restoration of the equipment. Fried also filed an answer to the complaint in which

he raised several affirmative defenses challenging the constitutionality of the

microbroadcasting regulations. Fried argued in general that the FCC regulations

barring new licenses to microbroadcasters violated the First Amendment, equal

protection and due process. Fried also argued that the microbroadcasting

regulations violated the Communications Act, 47 U.S.C. § 303(g) (directing the

FCC to encourage larger and more effective use of radio “in the public interest”), as

well as Article XIX of the United Nations Declaration of Human Rights and Article

XIX of the International Covenant on Civil and Political Rights. Fried did not

challenge the constitutionality of the Communications Act itself. ( We note that the

Supreme Court upheld the constitutionality of the Communications Act in NBC v.

United States, 319 U.S. 190, 227 (1943).)

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 The government filed a motion for judgment on the pleadings in its favor

pursuant to Fed. R. Civ. P. 12(c). The government argued that it was undisputed

that Fried used and possessed the radio equipment to broadcast without an FCC

license. Fried admitted that he intended to continue to operate the radio equipment

(and did in fact continue) to broadcast even after receiving the warning letter from

the FCC ordering him to cease operations immediately. The district court agreed

with the government that there was no material issue of fact in dispute and that it

was entitled to judgment as a matter of law – the radio equipment violated 47

U.S.C. § 301 and seizure and forfeiture of the radio equipment was authorized under

47 U.S.C. § 510(a). 976 F. Supp. at 1257.

The district court noted, however, that Fried’s affirmative defenses raised

constitutional and other challenges to the microbroadcasting regulations. The

government argued that it was entitled to judgment on the pleadings because,

pursuant to 47 U.S.C. § 402, the court of appeals, not the district court, has

exclusive jurisdiction to determine the validity of the microbroadcasting regulations.

Section 402(a) provides that “[a]ny proceeding to enjoin, set aside, annul, or

suspend any order of the [FCC] under this chapter (except those appealable under

subsection (b) of this section) shall be brought as provided by and in the manner

prescribed in chapter 158 of Title 28.” Chapter 158 includes 28 U.S.C. § 2342,

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which provides in part that “[t]he court of appeals . . . has exclusive jurisdiction to

enjoin, set aside, suspend . . . or to determine the validity of – (a) all final orders of

the [FCC] made reviewable by § 402(a) of title 47.” In other words, the

government argued that Fried was seeking to litigate his constitutional challenges in

the wrong forum–that, instead of litigating them in the district court, Fried should

raise his constitutional challenges before the FCC and then, assuming the FCC

rejected his constitutional arguments, seek judicial review by appealing the final

order of the FCC directly to the court of appeals. See e.g. FCC v. ITT World

Communications, Inc. , 466 U.S. 463, 468 (1984). The FCC has not issued a final

order in the present case because Fried has never applied for a license, although he

maintained (and the district court assumed so for purposes of analysis) that he had

filed a request for a waiver.

Fried argued that the district court, not the court of appeals, had exclusive

jurisdiction over the forfeiture action, including the merits of his constitutional

challenges to the microbroadcasting regulations. Fried argued that 47 U.S.C. §

504(a) vests exclusive jurisdiction in the district courts to hear forfeiture suits by the

government and suits by private individuals seeking to avoid forfeitures, including

the merits of his constitutional challenges to the microbroadcasting regulations:

The forfeitures provided for in this chapter shall be payable into

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 the Treasury of the United States, and shall be recoverable, . . . in a
civil suit in the name of the United States brought in the district where
the person or carrier has its principal operating office . . .: Provided,
That any suit for the recovery of a forfeiture imposed pursuant to the
provisions of this chapter shall be a trial de novo . . . .

Although federal district courts have exclusive jurisdiction to hear forfeiture

suits brought by the government and suits by individuals seeking to avoid

enforcement of forfeiture, the court of appeals has exclusive jurisdiction to

determine the validity of all final orders of the FCC. The present case involved both

an effort to avoid enforcement of the forfeiture (and thus a matter for the district

court) and a constitutional challenge to the microbroadcasting regulations (and thus

a matter for the court of appeals). The district court decided that Fried was really

challenging the constitutionality of the microbroadcasting regulations, rather than the

forfeiture order itself, and thus the case was properly one within the exclusive

jurisdiction of the court of appeals pursuant to 47 U.S.C. § 402. 976 F. Supp. at

1259. The district court distinguished the two cases relied upon by Fried to support

exclusive jurisdiction in the district court on the ground that, unlike Fried, the

claimants in those cases challenged some aspect of the forfeiture order. Id. at

1258-59, citing Pleasant Broadcasting Co. v. FCC, 564 F.2d 496 (D.C. Cir. 1977)

(Pleasant Broadcasting) (contesting whether refusal to permit FCC inspection

violated regulation), and Dougan v. FCC, 21 F.3d 1488 (9th Cir. 1994) (disputing

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whether petitioner violated regulation by refusing to permit FCC inspection). The

district court granted the government’s motion for judgment on the pleadings. This

appeal followed.4

STANDARD OF REVIEW

We review a motion for judgment on the pleadings de novo. We accept as

true all facts pleaded by the non-moving party and grant all reasonable inferences

from the pleadings in favor of the non-moving party. Judgment on the pleadings is

not properly granted unless the moving party has clearly established that no material

issue of fact remains to be resolved and the party is entitled to judgment as a matter

of law. Fed. R. Civ. P. 12(c); e.g., National Car Rental System, Inc. v. Computer

Assocs. Int’l, Inc., 991 F.2d 426, 428 (8th Cir.), cert. denied, 510 U.S. 861 (1993);

Westcott v. City of Omaha, 901 F.2d 1486, 1488 (8th Cir. 1990).

JURISDICTION OF THE DISTRICT COURT

The threshold issue is which court has exclusive jurisdiction – the district

4
The National Association of Broadcasters (NAB) has tendered an amicus
curiae brief in support of the Federal Communications Commission (FCC).
According to its brief, the NAB is a non-profit incorporated association of radio and
television broadcast stations and networks representing the nation’s broadcasting
industry and is committed to protecting the integrity of the spectrum used for radio
and television broadcasting to ensure that the public receives the highest quality
service.

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court (as Fried argues) or the court of appeals (as the government argues). The

parties raise essentially the same arguments on appeal as they did in the district

court. For reversal, Fried argues that the district court erred in holding that the court

of appeals has exclusive jurisdiction over the forfeiture action and his constitutional

defenses. Fried argues that the district court has exclusive jurisdiction because the

forfeiture provision, 47 U.S.C. § 504(a), specifically refers to trial de novo in the

district court and that reference contemplates adjudication of all issues raised in the

forfeiture action, including any and all defenses. He further argues that this specific

jurisdictional provision, which particularly refers to forfeiture orders in the district

courts, overrides 47 U.S.C. § 402, which is a general jurisdictional provision for

judicial review in the court of appeals of final orders of the FCC.

The government argues that the courts of appeals have exclusive jurisdiction

to review all final orders of the FCC, including orders deciding applications for

broadcast licenses and requests for waivers. See 47 U.S.C. § 402(a); 28 U.S.C. §

2342 (the court of appeals (other than the court of appeals for the Federal Circuit)

has exclusive jurisdiction to enjoin, set aside, suspend (in whole or in part), or to

determine the validity of all final orders of the FCC). The government argues that

the validity of the underlying microbroadcasting regulations is not at issue in the

forfeiture action and that Fried cannot “bootstrap” a constitutional challenge to the

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microbroadcasting regulations into the forfeiture action. The government argues

that, by attempting to bypass first administrative review by the FCC and then

judicial review in the court of appeals, Fried is improperly seeking what essentially

amounts to “pre-enforcement” review of the microbroadcasting regulations without

an adequate administrative record. The government argues that Fried can raise his

constitutional challenges to the microbroadcasting regulations by filing an

application for a license with a request for a waiver. If his application for a license

and request for a waiver are denied by the FCC, the government argues that Fried

can then appeal to the United States Court of Appeals for the District of Columbia

Circuit, pursuant to 47 U.S.C. § 402(b)(1). Alternatively, the government argues

that Fried can challenge the constitutionality of the microbroadcasting regulations by

filing a petition for rulemaking pursuant to 47 C.F.R. § 1.01, and, if that petition is

denied, seek judicial review in a court of appeals, pursuant to 47 U.S.C. § 402(a).

This case is an important one for the statutory scheme created by Congress

for the regulation of broadcasting. No binding authority is a precise precedent, with

the result that the court has a certain leeway in its interpretation of the jurisdictional

provisions of the Federal Communications Act. However, by close analogy with

decided cases, by out-of-circuit precedent, and by the terms of the statutory scheme,

the district court is without jurisdiction to entertain a challenge to FCC regulations.

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 The FCC has brought a forfeiture action against a broadcaster without a

license. The broadcaster’s only defense is that "the FCC prohibition against low

power broadcasting" is contrary to the Constitution of the United States, the

statutory mandate of 47 U.S.C. § 303(g), the United Nations Declaration of Human

Rights, and the International Covenant on Civil and Political Rights. The defense is

exclusively focused on the validity of the regulations. The district court has no

jurisdiction to decide the validity of the regulations and therefore has no jurisdiction

to consider the defense.

The statute provides: “Any proceeding to enjoin, set aside, annul, or suspend

any order of the Commission . . . shall be brought as provided by and in the manner

prescribed in chapter 158 of Title 28.” 47 U.S.C. § 402(a). The cross-referenced

statute states: “The court of appeals . . . has exclusive jurisdiction to enjoin, set

aside, suspend (in whole or in part), or to determine the validity of – (1) all final

orders of the Federal Communications Commission made reviewable by section

402(a) of title 47.” 28 U.S.C. § 2342. It is hard to think of clearer language

confining the review of regulations to the Courts of Appeal.

The Supreme Court has authoritatively determined that the exclusive

jurisdiction of the Court of Appeals over rulemaking by the FCC may not be evaded

by seeking to enjoin a final order of the FCC in the district court. ITT, 466 U.S. at

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468 (1984). A defensive attack on the FCC regulations is as much an evasion of the

exclusive jurisdiction of the Court of Appeals as is a preemptive strike by seeking

an injunction. Whichever way it is done, to ask the district court to decide whether

the regulations are valid violates the statutory requirements. As this court said in

applying ITT: “Where exclusive jurisdiction is mandated by statute, a party cannot

bypass the procedure by characterizing its position as a defense to an enforcement

action.” Southwestern Bell Telephone v. Ark. Pub. Serv., 738 F.2d 901, 906 (8th

Cir. 1984), vacated and remanded on other grounds, 476 U.S. 1167 (1986). “The

exclusive jurisdiction of the courts of appeals cannot be evaded simply by labeling

the proceeding as one other than a proceeding for judicial review.” Id.

The district court is the exclusive forum for a forfeiture. See Moser v. FCC,

46 F.3d 970, 973 (9th Cir.), cert. denied, 515 U.S. 1161 (1995); Dougan v. FCC, 21

F.3d 1488 (9th Cir. 1994); Pleasant Broadcasting Co. v. FCC, 564 F.2d 496 (D.C.

Cir. 1977).

The statutory scheme makes sense (1) to ensure review based on an

administrative record made before the agency charged with implementation of the

statute; (2) to ensure uniformity of decisionmaking because of uniform factfinding

made by the agency; (3) to bring to bear the agency’s expertise in engineering and

other technical questions. If Fried had no way of obtaining judicial review of the

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regulations his case might be different. See Thunder Basin Coal Co. v. Reich, 510

U.S. 200, 212-13 (1994). But he could have obtained review by applying for a

license and asking for a waiver of the regulations; rejection of his request would

have permitted appeal to the circuit. Rather than follow the procedures established

by law, he has attempted an end run blocked by the statutory channels provided for

constitutional claims.

AFFIRMED.

A true copy.

Attest:

U.S. COURT OF APPEALS, EIGHTH CIRCUIT.

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