The Arbitrary and Capricious FCC

Responding, no doubt, to my 2006 analysis of The Erratic FCC's recent history of un-noticed departures from the agency's own guidelines, the federal Court of Appeals for the Third Circuit, in CBS Corp. v. FCC, today vacated as “arbitrary and capricious” the FCC’s $550,000 indecency fine against CBS for Janet Jackson's "wardrobe malfunction” at the 2004 Super Bowl.

The court cited the FCC’s “arbitrary and capricious change of policy on the broadcast of fleeting indecent material,” departing from the FCC’s own policy guidelines, promulgated in 2001:

In its 2001 policy statement, the Commission described the “principal factors that have proved significant in [its] decisions to date” as: “(1) the explicitness or graphic nature of the description or depiction of sexual or excretory organs or activities; (2) whether the material dwells on or repeats at length descriptions of sexual or excretory organs or activities; (3) whether the material appears to pander or is used to titillate, or whether the material appears to have been presented for its shock value.” [emphasis in original]

The court said:

Like any agency, the FCC may change its policies without judicial second-guessing. But it cannot change a well established course of action without supplying notice of and a reasoned explanation for its policy departure. Because the FCC failed to satisfy this requirement, we find its new policy arbitrary and capricious under the Administrative Procedure Act as applied to CBS.

The opinion quotes a previous Third Circuit case, Trinity Broad. of Fla., Inc., 211 F.3d at 628:

Because ‘[d]ue process requires that parties receive fair notice before being deprived of property,’ we have repeatedly held that ‘[i]n the absence of notice–for example, where the regulation is not sufficiently clear to warn a party about what is expected of it–an agency may not deprive a party of property by imposing civil or criminal liability.’

The court said:

Because the Commission fails to acknowledge that it has changed its policy on fleeting material, it is unable to comply with the requirement under State Farm [Motor Vehicle Mfrs. Ass’n v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 41 (1983)] that an agency supply a reasoned explanation for its departure from prior policy.

The court cites Ramaprakash, 346 F.3d at 1125:

[F]ailure to come to grips with conflicting precedent constitutes an [agency’s]
inexcusable departure from the essential requirement of reasoned decision making.”);

and LeMoyne-Owen College v. NLRB, 357 F.3d 55, 61 (D.C. Cir. 2004):

[W]here, as here, a party makes a significant showing that analogous cases have been decided differently, the agency must do more than simply ignore that argument.

“Consequentially,” the court said, “the FCC’s new policy of including fleeting images within the scope of actionable indecency is arbitrary and capricious under State Farm and the Administrative Procedure Act, and therefore invalid as applied to CBS.”


In an aspect of the ruling separate from the conclusion that the FCC had departed from its guidelines, the court questioned the agency’s conclusion that CBS’s actions constituted a “‘willful’ violation of the indecency provisions.”

One of the principle factors laid out in the FCC’s 2001 policy guidelines, quoted above, is “whether the material appears to pander or is used to titillate, or whether the material appears to have been presented for its shock value.” But the agency’s recent history of decisions to penalize broadcasters has sometimes been driven by the fact that viewers have been shocked, rather than by whether the broadcasters willfully intended to shock, titillate, and pander. (See The Erratic FCC.) The court in CBS Corp. v. FCC found that “further clarification from the FCC is necessary before it may be determined whether the agency correctly concluded that CBS’s actions constituted a ‘willful’ violation of the indecency provisions.”