
USCA1 Opinion

	




                            UNITED STATES COURT OF APPEALS                            UNITED STATES COURT OF APPEALS                                FOR THE FIRST CIRCUIT                                FOR THE FIRST CIRCUIT                                 ____________________        No. 92-2225                          ACTION FOR CHILDREN'S TELEVISION,                                     Petitioner,                                          v.                      FEDERAL COMMUNICATIONS COMMISSION, ET AL.,                                     Respondents.                                 ____________________                           COALITION ON SMOKING OR HEALTH,                                     Intervenor.                                 ____________________                          ON PETITION FOR REVIEW OF AN ORDER                       OF THE FEDERAL COMMUNICATIONS COMMISSION                                 ____________________                                        Before                                Boudin, Circuit Judge,                                        _____________                           Campbell, Senior Circuit Judge,                                     ____________________                              and Stahl, Circuit Judge.                                         _____________                                 ____________________            Sharon  L. Webber with  whom Angela  J. Campbell  and Henry Geller            _________________            ___________________      ____________        were on brief for petitioner and intervenor.            C.  Grey  Pash, Jr.,  Counsel, Federal  Communications Commission,            __________________        with whom Renee Licht,  Acting General Counsel, Federal Communications                  ___________        Commission,  Daniel M. Armstrong,  Associate General  Counsel, Federal                     ___________________        Communications  Commission,  Robert  B.  Nicholson,  Attorney,  United                                     _____________________        States Department of  Justice, and Marion L.  Jetton, Attorney, United                                           _________________        States Department of Justice, were on brief for respondents.                                 ____________________                                    July 22, 1993                                 ____________________                 BOUDIN, Circuit Judge.  Action for Children's Television                         _____________            ("ACT") petitions for  review of the decision of  the Federal            Communications Commission denying ACT's request that the  FCC            take action to combat "hidden commercials" on television that            promote smoking.  We deny the petition.                  In  1966, acting on a private  citizen petition, the FCC            required broadcasters, under the  "fairness doctrine," to air            anti-smoking  messages  in  response  to   advertisements  by            cigarette companies.  See Banzhaf v. FCC, 405 F.2d 1082 (D.C.                                  ___ ______________            Cir. 1968), cert.  denied, 396  U.S. 842 (1969).1   In  1969,                        _____  ______            Congress enacted the  Cigarette Labeling and  Advertising Act            ("the  Cigarette Act"),  15  U.S.C.     1331  et seq.,  which                                                          __ ___            pertinently provided that "it  shall be unlawful to advertise            cigarettes  or little  cigars over  any medium  of electronic            communication  subject  to the  jurisdiction  of  the Federal            Communications Commission."  15 U.S.C.   1335.                   In 1970,  an organization  called Action on  Smoking and            Health ("ASH") petitioned the  FCC to require broadcasters to            continue   to  air   anti-smoking   messages,   despite   the            prohibition  contained in  the Cigarette  Act, partly  on the            ground  that   the  cigarette  industry  was   using  "hidden                                            ____________________                 1The   fairness  doctrine  was  an  FCC  rule  requiring            broadcasters  to  air  contrasting views  when  controversial            issues were addressed.  See Red Lion Broadcasting Co. v. FCC,                                    ___ ________________________________            395  U.S.  367  (1968).    The  rule  was  abandoned  by  the            Commission in  August 1987.   See Syracuse  Peace Council  v.                                          ___ ___________________________            FCC,  867 F.2d 654 (D.C.  Cir. 1989), cert.  denied, 493 U.S.            ___                                   _____  ______            1019 (1990).                                           -2-                                         -2-            commercials" to circumvent  the Act.   The quoted phrase,  as            ACT  uses  it, refers  to  cigarette  company sponsorship  of            sporting events during which the cigarette brand name or logo            is displayed on signs or banners, which in turn are broadcast            during  televised  coverage  of  these events,  such  as  the            Marlboro  Grand Prix auto race and  the Virginia Slims tennis            tournament.  The FCC denied the ASH request.  The agency said            that  it found  no  hard  evidence  of  the  use  of  "hidden            commercials"  by the cigarette  industry, and  concluded that            "if such  abuses do occur .  . . , the  appropriate action in            such an  eventuality would  be to secure  full and  effective            compliance with  the 1969 law,  and not  to deal  with it  by            offsetting   anti-smoking   messages."       Formulation   of                                                         ________________            Appropriate Further Regulatory Policies  Concerning Cigarette            _____________________________________________________________            Advertising and  Antismoking Presentations, 27  F.C.C.2d 453,            __________________________________________            458 n.5 (1970).                  In 1990, ACT filed with the FCC the petition at issue in            this  case.    ACT claimed  that  there  is  now indisputable            evidence  that   the  cigarette  industry  is  using  "hidden            commercials."   According to  the petition the  Department of            Justice has never initiated any enforcement proceedings under            the  Cigarette Act  and therefore  appears to  have concluded            that hidden commercials do  not violate the statute, creating            the need  for FCC action.   ACT requested the FCC  to issue a            "declaratory  ruling" requiring licensees to air anti-smoking                                         -3-                                         -3-            messages to offset the harm caused by the hidden advertising.            Because the fairness doctrine was no longer in existence, ACT            relied on  the "public  interest standard"  set forth  in the            Communications  Act  of 1934  to  govern  the regulation  and            licensing of broadcasters.   47 U.S.C.   303; see also id.                                                             ___ ____ __            307(a), 309(a), 310(d).                  ACT's petition  was denied  by the Commission  in August            1992.  In re Petition For Declaratory  Relief Regarding Anti-                   ______________________________________________________            Smoking Messages Filed by Action for Children's Television, 7            __________________________________________________________            F.C.C.R.  5466 (1992).  The FCC said that this issue had been            raised and resolved  in the 1970 proceedings brought  by ASH,            and  that ACT  had  presented nothing  new.   The  Commission            stated that it "continue[d] to believe that the Cigarette Act            itself is  properly looked  to as  defining both  the conduct            that is prohibited  [with respect  to cigarette  advertising]            and the  remedies that are available  to redress violations."            Id.  It is undisputed that the Department of Justice, not the            __            FCC, is exclusively charged  with enforcing the provisions of            the Cigarette Act.  See 15 U.S.C.   1339.   ACT now petitions                                ___            this court for review.2                                             ____________________                 2It  appears that  ACT, which  had been  a Massachusetts            corporation, was formally dissolved  as of December 31, 1992,            after its petition was filed  in this court.  By  letter, the            FCC says that ACT's  dissolution "raises the question whether            it  continues to be a  party aggrieved" by  the FCC's action.            In response ACT  points out that  under Massachusetts law,  a            dissolved corporation  "shall nevertheless be continued  as a            body corporate  for three years  . .   . for  the purpose  of            prosecuting or defending suits by or against it."  Mass. G.L.                                         -4-                                         -4-                 An  agency's decision  not to  undertake a  new project,                                        ___            regulation, or enforcement action  has been treated by courts            as  a somewhat  unusual  animal in  the  menagerie of  agency            actions  that may  be  presented  for  judicial review.    Of            course, where there  is a statutory obligation  on the agency            to take  a relatively specific  action, a court  might easily            conclude that it  had both a standard to  apply to a shirking            agency  and  a duty  to enforce  the  standard.   More often,            agencies  make  decisions  not  to  act  under  rather  broad            statutory standards  or, as is typically  true of enforcement            actions, under a general mandate to enforce the law.                  In such cases courts have been reluctant to second-guess            agencies  when   they  decline  to  act.     In  some  areas,            paralleling  prosecutorial decisions not  to seek indictment,            courts are  reluctant to intervene  at all;  in others,  they            have  recognized  great  discretion  in the  agency  when  it            declines to act and required only minimal justification.  See                                                                      ___            Heckler v.  Chaney, 470  U.S. 821  (1985);  United Church  of            _______     ______                          _________________            Christ v. FCC, 911 F.2d 813 (D.C. Cir. 1990).  As the circuit            ______    ___            most  experienced  in these  matters  said  in another  case,                                            ____________________            ch. 155,   51; see also City Communications, Inc. v. Detroit,                           ________ ____________________________________            888  F.2d 1081,  1086-87 (6th  Cir. 1989)  (looking to  state            corporate    law   to   determine   standing   of   dissolved            corporation).    Given the  statute  coupled  with the  FCC's            posture on the issue, we think that denial of the petition on            the merits is the proper course.                                         -5-                                         -5-            Natural  Resources Defense  Council,  Inc. v.  SEC, 606  F.2d            __________________________________________________            1031, 1046 (D.C. Cir. 1979) (citations omitted):                 An agency's discretionary  decision not to regulate                                                     ___                 a  given activity  is  inevitably  based, in  large                 measure, on factors  not inherently susceptible  to                 judicial  resolution  -- e.g.,  internal management                                          ____                 considerations   as   to   budget  and   personnel;                 evaluations  of its  own  competence;  weighing  of                 competing   policies   within  a   broad  statutory                 framework.                   This court  has made  similar  observations, see,  e.g.,                                                              ___   ____            Ward v. Skinner,  943 F.2d 157, 161 (1st Cir.  1991), and the            _______________            standard of  deference thus adopted  controls this case.   We            need not conclude that the FCC's refusal to undertake a rule-            making  is  automatically  immune  from judicial  review,  no            matter  how  egregious  the  occasion or  how  troubling  the            agency's explanation.   Here, the FCC's  explanation is quite            rational.   In sum, the agency ruled that Congress provided a            general  ban on television cigarette advertising as part of a            "comprehensive" federal  program, 15  U.S.C.   1331,  and, if            the ban  is being  infringed  at the  margins, Department  of            Justice  enforcement is  the  preferable course.   Given  the            FCC's broad  discretion  as  to  how to  deploy  its  limited            resources, this is an adequate explanation.                 ACT  says that the  explanation is faulty  to the extent            that  hidden commercials are a "loophole" in the law and thus                                         -6-                                         -6-            beyond  the reach  of the  Department of  Justice.3   Even if            this  were  so,   it  would  not  make  the   FCC's  position            unreasonable.  Instead, it could rationally leave to Congress            the  task   of  adjusting  the  balance  it   struck  in  its            "comprehensive" statute.  Plugging  loopholes might also be a                                                                ____            rational goal for  the agency  (we have no  occasion here  to            consider  preemption arguments);  but  agency  resources  are            limited and selecting which rational goals to  pursue is part            of the agency's function.                 There is  even less to ACT's  alternative criticism that            the  FCC's decision  in this  case  is inconsistent  with its            reasoning in its  earlier decision declining to  act on ASH's            petition.   ACT  argues that  the FCC  there declined  to act            because it found  a lack of evidence  that hidden commercials            were a significant problem and, ACT says, it has now provided            the missing evidence.   But the FCC went on to say in the ASH                                                                      ___            case  that, if the problem proved real, the solution would be            "to secure full and  effective compliance with the 1969  law,            and not to deal with it by offsetting anti-smoking messages."            27 F.C.C.2d at 458 n.5.  There is no inconsistency.                 The petition for review is denied.                                            ______                                            ____________________                 3There is in fact some indication that the Department of            Justice has  taken the  view that hidden  commercials violate            the  statute  and  has  written to  cigarette  companies  and            broadcasters  warning them of  its position.   Whether or not            this is the Department's present view is not material.                                         -7-                                         -7-
