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IN THE UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
___________________________________________
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v.
NATIONAL BROADCASTING COMPANY, INC.,
Defendant-Appellee,
COALITION TO PRESERVE THE FINANCIAL
INTEREST AND SYNDICATION RULE,
Applicant for Intervention-Appellant.
___________________________________________
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No. 93-56592 |
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v.
AMERICAN BROADCASTING COMPANIES, INC.,
Defendant-Appellee,
COALITION TO PRESERVE THE FINANCIAL
INTEREST AND SYNDICATION RULE,
Applicant for
Intervention-Appellant.
___________________________________________
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No. 93-56591 |
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v.
CBS, INC.,
Defendant-Appellee.
COALITION TO PRESERVE THE FINANCIAL
INTEREST AND SYNDICATION RULE,
Applicant for
Intervention-Appellant
___________________________________________
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No. 93-56588 |
RESPONSE OF THE UNITED STATES IN OPPOSITION TO
INTERVENOR-APPLICANTS' MOTIONS FOR STAY PENDING APPEAL
IN THE UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
___________________________________________
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v.
NATIONAL BROADCASTING COMPANY, INC.,
Defendant-Appellee,
GOVERNOR PETE WILSON AND THE STATE
OF CALIFORNIA,
Applicant for Intervention-Appellant.
___________________________________________
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No. 93-56596 |
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v.
AMERICAN BROADCASTING COMPANIES, INC.,
Defendant-Appellee,
GOVERNOR PETE WILSON AND THE STATE
OF CALIFORNIA,
Applicant for
Intervention-Appellant.
___________________________________________
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No. 93-56595 |
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v.
CBS, INC.,
Defendant-Appellee.
GOVERNOR PETE WILSON AND THE STATE
OF CALIFORNIA,
Applicant for
Intervention-Appellant.
___________________________________________
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No. 93-56594 |
RESPONSE OF THE UNITED STATES IN OPPOSITION TO
INTERVENOR-APPLICANTS' MOTIONS FOR STAY PENDING APPEAL
.
Page I
TABLE OF CONTENTS
TABLE OF AUTHORITIES.............................................ii
INTRODUCTION ....................................................1
STATEMENT....................................................2
ARGUMENT.....................................................8
I. MOVANTS HAVE NEITHER SHOWN A PROBABILITY OF SUCCESS ON
THE MERITS NOR RAISED SERIOUS LEGAL QUESTIONS..........9
A. The Orders Denying Intervention Were Proper........10
1. California Had No Right to Intervene..........10
2. The District Court Did Not Abuse Its
Discretion in Denying Permissive
Intervention.......................................15
3. The District Court Was Not Required To Allow
Intervention for Purposes of Appeal................23
B. The Modification Order Raises No Serious Legal
Questions..........................................25
II. THE EQUITIES DO NOT FAVOR ISSUANCE OF A STAY...........28
CONCLUSION...................................................32
Page ii.
TABLE OF AUTHORITIES
CASES
American Express Co. v. United States Department of
Justice, 453 F. Supp. 47 (S.D.N.Y. 1978).........................15
Bethune Plaza, Inc. v. Lumpkin, 863 F.2d 525 (7th Cir.
1988) ..........................................................24
Blake v. Pallan, 554 F.2d 947 (9th Cir. 1977)..............23
California v. Tahoe Regional Planning Agency, 792 F.2d
775 (9th Cir. 1986).............................................10,11,16
Cascade Natural Gas Corp. v. El Paso Natural Gas Co.,
386 U.S. 129 (1967).............................................21
In re Benny, 791 F.2d 712 (9th Cir. 1986)..................10,11,16
Ingram v. Acands, Inc., 977 F.2d 1332 (9th Cir. 1992)......30
Lopez v. Heckler, 713 F.2d 1432 (9th Cir. 1983)............8,9
Sam Fox Publishing Co. v. United States, 366 U.S. 689
(1961)...........................................................21
Schurz Communications, Inc. v. FCC, 982 F.2d 1043 (7th
Cir. 1992) .....................................................5
Scotts Valley Band of Pomo Indians v. United States, 921
F.2d 924 (9th Cir. 1990) .......................................11
United States v. $129,374 in United States Currency
, 769
F.2d 583 (9th Cir. 1985), cert. denied, 474 U.S. 1086
(1986) .........................................................18,23,24
United States v. American Cyanamid Co., 556 F. Supp
.
357 (S.D.N.Y. 1982), aff'd in part and rev'd in part,
719 F.2d 558 (2d Cir. 1983), cert. denied, 465 U.S.
1101 (1984) ...................................................19,21,25
United States v. American Cyanamid Co., 719 F.2d 558 (2d
Cir. 1983), cert. denied, 465 U.S. 1101 (1984) ...........13,25
United States v. Associated Milk Producers, Inc., 394 F.
Supp. 29 (W.D. Mo. 1975), aff'd, 534 F.2d 113 (8th
Cir.), cert. denied, 429 U.S. 940 (1976) ........................14
Page iii
United States v. Associated Milk Producers, Inc., 534
F.2d 113 (8th Cir.), cert. denied, 429 U.S. 940
(1976)...........................................................21
United States v. Automobile Manufacturers Association,
307 F. Supp. 617 (C.D. Cal. 1969), aff'd, 397 U.S.
248 (1970) .....................................................18
United States v. Bechtel Corp., 648 F.2d 660 (9th Cir.),
cert. denied, 454 U.S. 1083 (1981) .......................15,20,22,26
United States v. Blue Chip Stamp Co., 272 F. Supp. 432
(C.D. Cal. 1967), aff'd sub nom. Thrifty Shoppers
Script Co. v. United States, 389 U.S. 580 (1968) ................21,22
United States v. Carrols Development Corp., 454 F. Supp.
1215 (N.D.N.Y. 1978)............................................18
United States v. G. Heileman Brewing Co., 563 F. Supp.
642 (D. Del. 1983)..............................................18,21,22
United States v. LTV Corp., 746 F.2d 51 (D.C. Cir.
1984) .........................................................9,14,23
United States v. Mid-America Dairymen, Inc., 1977-1
Trade Cas. (CCH) �,508 (W.D. Mo. 1977) .......................26
United States v. Motor Vehicle Manufacturers Ass'n,
1981-2 Trade Cas. �,370 (C.D. Cal. 1981)......................13
United States v. National Broadcasting Co., 449 F. Supp.
1127 (C.D. Cal. 1978) .........................................2,10,21
United States v. Stroh Brewery Co., 1982-2 Trade Cas.
(CCH) �,804 (D.D.C. 1982) ....................................18
United States v. Western Electric Co., 1991-2 Trade Cas.
(CCH) �,610 (D.C. Cir. 1991) .................................25,26
United States v. Western Electric Co., 552 F. Supp. 131
(D.D.C. 1982), aff'd mem. sub. nom. Maryland v.
United States, 460 U.S. 1001 (1983) ............................15,25,26
United States v. Western Electric Co., 993 F.2d 1572
(D.C. Cir.), cert. denied, 114 S. Ct. 487 (1993)..........26
Warm Springs Dam Task Force v. Gribble, 565 F.2d 549
(9th Cir. 1977) ................................................9
Yniguez v. Arizona, 939 F.2d 727 (9th Cir. 1991) ..........24
Page iv
STATUTES AND RULES
Fed. R. Civ. P. 24 passim
Antitrust Procedures and Penalties Act, 15
U.S.C. � (Tunney Act) .......................................11,15
MISCELLANEOUS
7C Charles A. Wright, et al., Federal Practice and
Procedure (1986) ................................................9,21,23
.
Page 1.
RESPONSE OF THE UNITED STATES IN OPPOSITION TO
INTERVENOR-APPLICANTS' MOTIONS FOR STAY PENDING APPEAL
INTRODUCTION
The State of California and Governor Pete Wilson ("California"),
and the Coalition To Preserve the Financial Interest and
Syndication Rules (the "Coalition") have moved for a stay of the
district court order (Coal. App. 180-81)1
approving consensual modifications of antitrust consent decrees
entered in the United States' cases against National Broadcasting
Company, Inc., CBS, Inc., and American Broadcasting Companies,
Inc. ("the Networks"). Movants seek to stay the decree
modifications pending their appeals from the district court's
denial of their motions to intervene in the modification
proceedings (Coal. App. 173-74). The United States, which
consented to and advocated the decree modifications sought by the
Networks, opposes the stay motions.
Neither California nor the Coalition has shown that the denials
of intervention are likely to be reversed by this Court or that
they raise any substantial legal question. Moreover, California
and the Coalition have not shown that, even if they were
permitted to intervene and to appeal the modification order, that
order likely would be reversed or would raise any substantial
legal question. California and the Coalition also have failed to
Page 2..
show that the balance of equities favors a stay. The district
court found that it is in the public interest to modify the
consent judgments (Coal. App. 180). In approving the decree
modifications and denying motions for stay pending appeal (see
Coal. App. 174-75), the court expressly considered the
contentions of the Coalition and California that anticompetitive
conduct by the Networks would be likely absent the decree
restrictions, and it found those contentions meritless. Delay in
implementing a decree modification that the Department of Justice
and the court have concluded will serve the public interest in
competition obviously would be contrary to the public interest,
as well as the Networks' private interests.
STATEMENT2
The consent decrees entered by the district court in the United
States' antitrust cases against the three major television
networks, ABC, CBS and NBC, prohibited the defendant Networks
from obtaining financial interests or syndication rights, other
than network exhibition rights, in any television programs
produced, in whole or in part, by an independent producer
(section IV, Coal. App. 13). See United States v. National
Page 3
Broadcasting Co., 449 F. Supp. 1127 (C.D. Cal. 1978).3
The decrees also prohibited, subject to certain exceptions, the
Networks from conditioning the right to network exhibition of a
program on the receipt of any right or interest from that
program's producer (section VI(A), Coal. App. 14). In May 1992,
the defendant Networks moved to modify the decrees to eliminate
these "financial interest and syndication restrictions."
The United States tentatively consented to the proposed
modifications. Following its standard procedures for
modification or termination of antitrust decrees, the Department
of Justice filed a memorandum with the district court explaining
the background of the decrees, the standard applicable to
judicial review of consensual antitrust decree modifications, and
the bases for its conclusion that removal of the decrees'
financial interest and syndication restrictions would further the
public interest in competition.4 At the Department's request, the
Court entered an order which required the defendants to publish
notice of the proposed modifications and instituted a 60-day
period during which the public was encouraged to submit comments
to the Department regarding the proposed modifications. (NW App.
371) California and the Coalition submitted comments
Page 4
opposing the modifications;5 the Department filed all comments
with the court on August 27, 1992.
California and the Coalition then moved to intervene in the
decree modification proceedings. California contended that it
had a right to intervene under Fed. R. Civ. P. 24(a).
Alternatively, California sought permission to intervene under
Fed. R. Civ. P. 24(b)(1) and (2). The Coalition sought only
permissive intervention under Rule 24(b)(2). The United States
(NW App. 294-320) and the Networks (NW App. 253-93) opposed these
motions. The United States made clear that it had no objection
to California and the Coalition presenting to the court their
views on the proposed modification, but pointed out that
intervention was not necessary for that purpose. Even without
intervenor status, movants had had ample opportunity to submit
comments that the court would consider, and the court also could
allow them to participate in any hearing on the modification.
On October 19, 1992, the district court (Judge Kelleher) held a
hearing on the motions to intervene, and announced his "ruling"
that:
both with respect to the Coalition's motion to intervene,
which is on the ground of permissive intervention, and the
motion of the State of California to intervene based both on
Page 5.
its claim to entitlement as of right and permissibly, each motion
is denied.
Tr. 28-29 (Coal. App. 58-59). The ruling was noted in the Civil
Minutes (Coal. App. 62), but no order was entered at that time.
Neither the Coalition nor California filed a notice of appeal
from the denial of the intervention motions. However, they filed
ex parte applications for a stay of the district court
proceedings pending appeal of the intervention rulings. (Coal.
App. 110, Cal. App. Ex.K).
Over a period of several months, the Department of Justice
reviewed and considered all the comments on the proposed
modification. On November 17, 1992, the Department filed the
Response of the United States to Public Comments ("US Response")
(Coal. App. 63-108). The United States' Response addressed and
refuted the various arguments of California, the Coalition and
other commenters opposed to the proposed modification. The
United States reiterated its conclusions that there was no
competitive basis for retaining the decree restrictions and that
the restrictions could themselves be anticompetitive.
Accordingly, the United States asked the court to approve the
modifications as consistent with the public interest in
competition.6
Page 6
Orders filed on August 6, 1993, denied the stay motions (Judge
Kelleher) (Coal. App. 147-48), and transferred proceedings in
this case to Judge Real (Coal. App. 149-50). The order denying
the stay referred (Coal. App. 147) to "the Court's October 19,
1992 Order denying intervention." The court then scheduled a
hearing on the modification motions for October 18, 1993. Prior
to the hearing, the Networks, California and the Coalition filed
"status reports." California and the Coalition requested that
the court enter orders on the intervention motions and reiterated
their requests for a stay of proceedings (or of any order
approving the modification) pending appeals from the denial of
intervention. (Coal. App. 150-55; 156-60.) The networks
requested that the district court promptly enter the modification
order. (Coal. App. 163-70; NW App. 358-64.) Counsel for
California and the Coalition, as well as counsel for the Networks
and the United States, appeared at the October 18, 1993, hearing.
Judge Real asked all counsel whether they had anything to add to
their written submissions. No one did. (Coal. App. 365-70.)
The district court's opinion on the modification motions was
entered November 10, 1993. (Coal. App. 170-79.) The order
"finding that it is in the public interest to modify the Consent
Judgment[s]" and modifying the decrees so as to delete the
financial interest and syndication restrictions was entered
Page 7
November 15, 1993. (Coal. App. 180-81.) In the opinion, the
district court first summarized the history of the decrees, the
significant changes that have occurred in the television industry
since the decrees were entered, and the public notice and comment
proceedings that had been held on the proposed decree
modifications. (Coal. App. 170-75.) Judge Real also stated that
he had reviewed the motions for intervention and for stay pending
appeal, and he adopted Judge Kelleher's denials of those motions.
(Coal. App. 174-75.)
The district court then explained why it agreed with the
Department of Justice that the Networks currently do not have
monopsony power in program purchasing and would not be likely to
acquire monopoly power in syndication. (Coal. App. 175-78.) The
Court also found that there was no evidence of collusion among
the Networks. (Id. at 175.) In reviewing the proposed
modifications, the court explicitly stated that it had considered
all comments and the materials that California and the Coalition
had submitted in support of their intervention motions
(id. at 175), and it expressly addressed their contentions that
the Networks have monopoly or monopsony power, individually or
through tacit collusion (id. at 175-78). The court, however,
found no evidence to support these contentions, and it concluded
that "[w]ithout evidence, the public interest is not served by
[California and the Coalition's] self-serving suppositions" that
collusion among the networks or other anticompetitive effects
Page 8..
would be likely absent the decree restrictions. (Id. at 176.)
The court also noted that the FTC's Bureau of Economics agreed
with the Department's competition analysis and that the Seventh
Circuit had found the FCC's financial interest and syndication
restrictions unjustified. (See id. at 177-78.)
Thus, after considering the entire record, the court concluded
that, under present conditions:
the logic of restricting markets to aid competition is
flawed. It is eminently possible that even in 1970 the
anti-trust theory applicable to the FIN-SYN rules was
flawed. That is not before me now but certainly in 1993
with the entry of the Fox network, the substantial rise in
the number of program producers, the dramatic increase in
cable television stations and the development in the
sophistication of VCRs the competitive climate today would
unfairly penalize NBC, ABC and CBS in the financing and
syndication of off-network programming.
(Coal. App. 179.)
The Coalition filed a notice of appeal from the denial of
intervention on November 17, 1993, and filed a motion in this
Court on November 24, 1993, for stay of the modification order
pending resolution of the intervention appeals. California filed
its notice of appeal on November 19, 1993, and its stay motion on
November 30.
ARGUMENT
As the two district judges who considered the stay motions
concluded, California and the Coalition have failed to satisfy
either of this Circuit's "two interrelated legal tests" for
determining whether proceedings should be stayed pending appeal.
Lopez v. Heckler, 713 F.2d 1432, 1435 (9th Cir. 1983) (citing Page 9.....
Angeles Memorial Coliseum Comm'n v. National Football League,
634 F.2d 1197, 1201 (9th Cir. 1980)). They have neither shown
"both a probability of success on the merits and the possibility
of irreparable injury," nor "demonstrate[d] that serious legal
questions are raised and that the balance of
hardships tips sharply in [their] favor." Id. (citations
omitted). Moreover, "the public interest is a factor to be
strongly considered" in determining whether to grant a stay
pending appeal. Id. (citing Warm Springs Dam Task Force v.
Gribble, 565 F.2d 549, 551 (9th Cir. 1977)). The public interest
weighs strongly against continuation of the Network decrees'
financial interest and syndication restrictions because the
Department of Justice and the district court have found that
removal of these restrictions will serve the public interest in
competition.
I. MOVANTS HAVE NEITHER SHOWN A PROBABILITY OF SUCCESS ON THE
MERITS NOR RAISED SERIOUS LEGAL QUESTIONS
Movants are not parties to the government's antitrust cases
against the networks or to the decree modification proceedings.
Unless the order denying them intervenor status is reversed, they
will have no right to appeal from the order modifying the decree.
United States v. LTV Corp., 746 F.2d 51, 53 (D.C. Cir. 1984); 7C
Charles A. Wright, et al., Federal Practice and Procedure �23
at 518 (1986). Thus, they are not entitled to a stay of the
modification order unless they raise, at a minimum, serious legal
questions both as to the intervention order and the modification
Page 10.....
order. Their motions fail to make that showing with respect to
either order.
A. The Orders Denying Intervention Were Proper
When the district court was considering in 1977 whether to enter
the NBC decree, CBS, which thought the decree too restrictive of
the Networks, and independent program suppliers, who contended
that the proposed decree did not impose sufficient restrictions,
moved to intervene. The district court denied those motions.
See United States v. NBC, 449 F. Supp. at 1143.7
This Court affirmed in an unpublished memorandum (Coal. App. 22-29),
concluding that the applicants had no right to intervene
because they had not "made a strong showing that the government
inadequately represents their interests" (id. at 26-28) and that
the district court had not abused its discretion in denying
permissive intervention (id. at 28-29). There is no reason to
believe that the result on the present appeals will be different.
1. California Had No Right to Intervene
California, but not the Coalition, sought intervention as of
right in the decree modification proceeding under Fed. R. Civ. P.
Page 11....
24(a)(2).8 This Court reviews de novo
orders denying intervention of right. See, e.g., California v.
Tahoe Regional Planning Agency, 792 F.2d 775, 781 (9th Cir.
1986); In re Benny, 791 F.2d 712, 721-22 (9th Cir. 1986). For
purposes of its stay motion, California contends that the
district court erred in denying intervention of right only with
respect to its "claim that the Tunney Act [Antitrust Procedures
and Penalties Act, 15 U.S.C. �] applies to these proceedings,"
and not with respect to its contention that the proposed
modification is contrary to the public interest.9
Rule 24(a)(2) and this Court's decisions applying that rule
establish a four-part test for intervention as of right. The
application must be timely; the applicant must claim an interest
in the property or transaction that is the subject of the action;
the applicant must be so situated that, without intervention,
disposition of the action may as a practical matter impair or
impede the applicant's ability to protect its interest; and the
applicant's interest must be inadequately represented by existing
parties to the litigation. Fed. R. Civ. P. 24(a)(2); Scotts
Valley Band of Pomo Indians v. United States, 921 F.2d
924, 926
Page 12
(9th Cir. 1990); California v. Tahoe Regional Planning
Agency, 792 F.2d at 781. Denial of California's request for
intervention to litigate its contention that the Tunney Act
applied to the decree modification proceedings was entirely
proper because California failed to meet that standard.
Even assuming that under, Rule 24(a), California's concern that
the Tunney Act be applied rises to the level of "an interest
relating to the property or transaction which is the subject of"
the modification proceedings, the denial of intervention did not
impair its opportunity to litigate that issue. California raised
the Tunney Act issue in its comments on the proposed modification
(NW App. 173-95), and the United States filed California's
comments with the court. California also addressed the Tunney
Act issue in its motion to intervene. (Cal. App. 20-21, 113-18.)
At the October 1992 hearing on the intervention motions, Judge
Kelleher specifically asked counsel for California: "And what
further would you do to indicate that the statute applied beyond
what you have already done?" Counsel responded:
I think I can flush [sic] it out in perhaps a little bit
more detail, present a little bit more of the background,
the legislative history of the case in perhaps little more
detail. If we put in the nuts and bolts of it, I suspect we
can probably flush [sic] it out a little bit more in an
actual motion to intervene.
Tr. 21 (Coal. App. 51).
In these circumstances, Judge Kelleher properly considered but
rejected California's Tunney Act arguments as a basis for
intervention. Tr. 22 (Coal. App. 52). A year passed between
Page 13..
that hearing and Judge Kelleher and Judge Real's October 1993
hearing. California neither offered any new submissions on the
Tunney Act issue nor made any request to supplement its earlier
filings. Thus, the denial of intervention did not impair
California's ability to present its arguments on the
applicability of the Tunney Act.
Moreover, there would have been no point to further litigation
over the applicability of the Tunney Act at the time California
filed its motions, or at any time thereafter. The United States
consistently has taken the position that the Tunney Act applies
only to the initial entry of consent decrees,10
but there is no doubt that the same standard -- the public
interest standard --
applies to the entry of a consent decree under the Tunney Act
and to the consensual modification of an antitrust decree. (See
NW App. at 10-15, 33 n.49.) And the district court applied the
public interest standard. (Coal. App. 180.) Further, by the
time California filed its motion to intervene, the district court
already had adopted the procedures recommended by the Department,
which provided the same opportunity for public comment that the
Page 14..
Tunney Act would have afforded, while improving actual notice.11
And the Tunney Act, even if applicable, would not have required
the Court to permit intervention,12
take evidence, hold hearings or adopt any other specific post-
comment procedures to obtain additional views from the public.
Nor would a strict application of the Tunney Act procedural
requirements have added any relevant information to the record on
which the court reviewed the proposed modifications. The US
Modification Memorandum (NW App. 1-53) provided the information
and analysis usually included in a competitive impact statement,
see 15 U.S.C. �(b), to the extent the requirements fit the
modification context. As was implicit in the US Modification
Memorandum, the only alternative the United States considered,
see 15 U.S.C. �(b)(6), was to leave the financial interest and
syndication restrictions unchanged, and the US Modification
Memorandum fully explained the reasons for rejecting this
alternative. In evaluating the likely competitive effects of
removing the decrees' financial interest and syndication
restrictions and deciding whether to consent to the proposed
Page 15.....
modifications, the Department of Justice considered a wide range
of materials and obtained information from many interested
persons. (See NW App. at 15.) However, there were no "materials
and documents which the United States considered determinative
in formulating" the proposed modification. See 15 U.S.C. �(b).
Accordingly, by the time California filed its motion to
intervene, any error in not adhering strictly to Tunney Act
procedures was of no practical significance to the modification
proceedings.13 In these circumstances,
further litigation to resolve the theoretical issue whether the
Tunney Act applied would only have delayed those proceedings
unduly. Cf. United States v. Western Elec. Co., 552 F. Supp.
131, 145 (D.D.C. 1982), aff'd mem. sub. nom. Maryland v. United
States, 460 U.S. 1001 (1983) (parties agreed that Tunney Act
procedures would apply; it was "unnecessary for the [c]ourt to
pass specifically upon the technical applicability of the
Act").14
Page 16..
2. The District Court Did Not Abuse Its Discretion in
Denying Permissive Intervention
California and the Coalition also sought permissive intervention
under Rule 24(b). Rule 24(b) provides that "[u]pon timely
application, anyone may be permitted to intervene in an action .
. . when an applicant's claim or defense and the main action have
a question of law or fact in common." (Emphasis added.) In
determining whether to grant, deny or limit permissive
intervention, the court is to "consider whether the intervention
will unduly delay or prejudice the adjudication of the rights of
the original parties." Id. Orders
denying permissive intervention are reviewed under an abuse of
discretion standard. See, e.g., In re Benny, 791 F.2d at 721-22;
California v. Tahoe Regional Planning Agency, 792 F.2d at 782.
a. Intervention was not necessary to allow movants to present
their views and arguments to the court on any "claim or defense"
they might have had related to the decree proceedings.15
Page 17
California and the Coalition submitted extensive comments, in
which they set forth their concerns about possible
anticompetitive effects of the proposed modifications (NW App.
54, 172, 173-95); the Coalition's comments inclujded a lengthy
affidavit from an economic expert (NW App. 125-72). The
Department of Justice filed all comments with the district court,
carefully considered them before confirming its tentative
decision to consent to the decree modifications, and filed a
detailed response with the court (Coal. App. 63-108).
The Coalition and California not only were permitted to make
written filings; they also received notice of all proceedings,
including the final October 1993 hearing on the proposed
modifications. Their counsel appeared at the hearing but offered
neither further argument nor additional evidence in response to
Judge Real's question whether anyone had anything to add to their
written submissions. (NW App. 367-68.)16
Further, the district court's opinion makes clear that, before
approving the modification, it carefully considered all
submissions, including
Page 18.....
the comments and intervention motions of California and the
Coalition. (Coal. App. 175.)
Accordingly, when Judge Real reviewed the intervention motions,
he could not help but conclude, as had Judge Kelleher, that
whatever additional proceedings movants might seek as intervenors
would be likely to cause undue delay in the modification
proceedings. In these circumstances, denial of intervention was
a proper exercise of discretion.17
The district court's decision here accords with the decisions of
other courts, which have generally exercised their discretion to
deny motions for permissive intervention in antitrust consent
decree and decree modification proceedings. See, e.g., United
States v. G. Heileman Brewing Co., 563 F. Supp. 642, 649-50 (D.
Del. 1983); United States v. Stroh Brewery Co., 1982-2 Trade Cas.
(CCH) �,804 at 71,960 (D.D.C. 1982) (in consent decree
proceeding permissive intervention denied under Fed. R. Civ. P.
24(b) denied because "where there is no claim of bad faith or
Page 19.
malfeasance . . . the potential for unwarranted delay and
substantial prejudice to the original parties implicit in the
proposed intervention clearly outweighs any benefit that may
accrue therefrom"); United States v. Automobile Manufacturers
Ass'n, 307 F. Supp. 617, 620 (C.D. Cal. 1969), aff'd, 397
U.S. 248 (1970) (permissive intervention denied to parties
seeking to block entry of consent decree); United States v.
Carrols Dev. Corp., 454 F. Supp. 1215, 1221 (N.D.N.Y. 1978)
(same). Indeed, movants cite no case in which this Court or any
other court of appeals has reversed an order denying permissive
intervention in an antitrust decree proceeding.
The antitrust decision on which movants place greatest reliance,
United States v. American Cyanamid, 556 F. Supp. 357 (S.D.N.Y.
1982), aff'd in part and rev'd in part, 719 F.2d 558 (2d Cir.
1983) (affirming grant of permissive intervention), cert.
denied, 465 U.S. 1101 (1984), does not support their
contention that it is an abuse of discretion to deny permissive
intervention either in antitrust consent decree proceedings
generally or in the circumstances of this case. At most, it
establishes that a court's discretion is sufficiently broad that,
at least in some cases, it also is not an abuse of discretion to
grant intervention.18
Page 20.
b. Movants point to two factors Judge Kelleher identified in
his comments at the October 19, 1992 hearing and argue that they
provide insufficient support for his refusal to exercise his
discretion to permit intervention under Rule 24(b). (Coal.
Motion at 20-32; Cal. Motion at 10-12.) At that hearing, Judge
Kelleher noted that, in light of the disposition of similar
issues in past proceedings on this decree, he
was rather startled to think that there were any parties who
could properly contend that they had right to intervene here
on the only basis really which would justify it; and that
is, that their interests could not be and would not be
protected absent intervention.
Tr. 6-7 (Coal. App. 36-37). He also remarked that "if [the
Coalition or its members] had a justifiable interest to be
protected and a meritorious claim in support of those interests,
that the courts are open to your lawsuit." Tr. 19 (Coal. App.
49).
With respect to the first comment, movants (Coal. Motion at 20-
30; Cal. Motion at 10-12) criticize Judge Kelleher for failing to
take account of factors this Court has considered in other
contexts in determining whether a party will adequately represent
the interests of a would-be intervenor. But Rule 24(b) does not
grant an automatic right to intervene to any person whose
Page 21........
interests will not be represented by the parties to litigation.19
Moreover, the question before the district court was not whether
particular private interests had a right to antitrust relief, but
whether the proposed antitrust consent decree modifications were
consistent with the public interest in competition. Courts
consistently recognize that in government antitrust cases, the
United States represents the public interest in competition.
See, e.g., United States v. Bechtel Corp., 648 F.2d 660, 666 (9th
Cir.), cert. denied, 454 U.S. 1083 (1981); United States v. NBC,
449 F. Supp. at 1142 (cited in Bechtel); United States v.
Associated Milk Producers, Inc., 534 F.2d 113, 117 (8th Cir.),
cert. denied, 429 U.S. 940 (1976); United States v. G. Heileman
Brewing Co., 563 F. Supp. 642, 648 (D. Del. 1983); see also Sam
Fox Publishing Co. v. United States, 366 U.S. 683, 689 (1961).
Therefore, an applicant claiming a right to intervene in a
government antitrust case to represent that interest has the
burden of "establish[ing] that the Government has not acted
properly in the public interest." United States v. Blue Chip
Stamp Co., 272 F. Supp. 432, 438 (C.D. Cal. 1967), aff'd sub
nom. Thrifty Shoppers Script Co. v. United States, 389 U.S.
580 (1968) (per curiam); accord United States v. American
Cyanamid, 556 F. Supp. at 360 (S.D.N.Y. 1982); Page 22...
Brewing Co., 563 F. Supp. at 650; United States
v. Stroh Brewery Co., 1982-2 Trade Cases (CCH) �,804 at
71,959-60; 7C Wright, supra, �09 at 332 ("in the absence of a
very compelling showing to the contrary, it will be assumed that
the United States adequately represents the public interest in
antitrust suits").20
That California and the Coalition disagree with the Department's
conclusion that the decree modifications will serve the public
interest in competition does not establish that the Department's
representation of the public interest was inadequate. See United
States v. G. Heileman Brewing Co., 563 F. Supp. at 648;
United States v. Blue Chip Stamp Co., 272 F. Supp. at 438-39. To
the contrary, the district court's public interest review, in
which it considered the submissions of California and the
Coalition, "insur[ed] that the government has not breached its
duty to the public in consenting to the decree modification."
Bechtel, 648 F.2d at 666.
To the extent California and the Coalition had interests
consistent with the public interest in competition, therefore,
their interests were adequately represented. To the extent they
Page 23.....
had other private interests, the Department, of course, would not
represent their views. But any such private claims would provide
no basis for disapproving consensual decree modifications
consistent with the public interest and would present factual and
legal issues quite different from the public interest question
raised in the modification proceeding. Thus, there is no basis
for movants' assertion that judicial economy would be better
served by allowing them to intervene to assert their private
concerns in the modification proceeding.21
Further, Judge Kelleher was quite correct in observing that
disposition of the modification motions would not impair the
ability of the Coalition members or of California or its citizens
to secure whatever legal remedies would otherwise be available to
them to prevent or redress actual or threatened anticompetitive
conduct by the Networks. The Coalition's members may bring
private antitrust actions for damages or injunctive relief.
California also will retain its powers to bring antitrust actions
or to seek regulation on behalf of its citizens. And neither the
district court's prior decisions entering the consent decrees nor
its decision modifying the decrees would have any stare decisis
Page 24...
effect in any antitrust case. Both proceedings sought only
judicial approval of decree provisions on which the parties
agreed, and the court did not adjudicate the merits of any of the
claims in the underlying actions that were terminated by the
decrees.
3. The District Court Was Not Required To Allow Intervention for
Purposes of Appeal
As movants concede, unless the denials of intervention are
reversed, they have no right to seek review of the order
modifying the decrees. (Cal. Motion at 2, Coal. Motion at 32
(both citing United States v. LTV Corp., 746 F.2d 51, 53 (D.C.
Cir. 1984)); see also, e.g., United States v. $129,374 in United
States Currency, 769 F.2d 583, 590 (9th Cir. 1985), cert.
denied, 474 U.S. 1086 (1986). Contrary to movants'
contentions, however, the district court was not required to
allow them to intervene for purposes of pursuing such appeals,
and it did not abuse its discretion in declining to do so.
At a minimum, an applicant seeking intervention for purposes of
appeal must satisfy the criteria of Rule 24. Yniguez v. Arizona,
939 F.2d 727, 731 (9th Cir. 1991).22
Neither movant had -- and the Coalition did not even claim -- a
right to intervene in the
Page 25.....
district court modification proceedings. Thus neither has a
right to intervene for purposes of appeal.23
Nor is there any basis on which this Court could properly hold
that the district court in this case abused its discretion under
Rule 24(b) in denying permissive intervention for purposes of
appeal. Neither the United States nor the networks will appeal
the order granting the relief they sought -- modification of the
decrees. Thus there is no longer any "main action," and any
intervenors' appeals would unnecessarily burden this Court, as
well as the parties, by prolonging the litigation.24
Movants' reliance (Coal. Motion at 33; Cal. Motion at 15) on the
few cases in which district courts have permitted opponents of
consensual antitrust decrees or decree modifications to intervene
under Rule 24(b) for purposes of appealing orders
approving them, American Cyanamid, 556 F. Supp. at 361 and United
States v. AT&T, 552 F. Supp. at 218-19, and on the Second
Circuit's holding that granting intervention was not an abuse of
discretion in Cyanamid, 719 F.2d at 562-63, is misplaced. Rule
24(b) affords
Page 26.....
considerable discretion to the district court, and movants do not
cite, nor are we aware of, any case in which a
reviewing court has found an abuse of discretion in the denial of
permissive intervention for purposes of appeal in an antitrust
consent decree or decree modification proceeding.
B. The Modification Order Raises No Serious Legal Questions
The stay motions should be denied for a further reason:
California and the Coalition fail to raise any serious legal
question as to the modification order they ask this Court to
stay. Thus even if they were allowed to intervene and to appeal
the modification order, a stay pending appeal would be
unwarranted.25
The question before the district court was whether the proposed
consensual modifications of consent decrees entered in a
government antitrust cases more than ten years ago were
consistent with the public interest in competition. As this
Court has emphasized:
The balancing of competing social and political
interests affected by a proposed antitrust decree
must be left, in the first instance, to the
discretion of the Attorney General. The court's
role in protecting the public interest is one of
Page 27
insuring that the government has not breached its duty to the
public in consenting to the decree. The court is required to
determine not whether a particular decree is the one that will
best serve society, but whether the settlement is "within the
reaches of the public interest."
United States v. Bechtel Corp., 648 F.2d 660, 666 (9th Cir.)
(quoting United States v. Gillette Co., 406 F. Supp. 713, 716
(D. Mass. 1975)), cert. denied, 454 U.S. 1083 (1981).26
In this case, the Department's initial memorandum (NW App. 1-53)
and its response to public comments (Coal. App. 63-109) explained
in detail the bases for its conclusion that removal of the decree
restrictions would further the public interest in competition.
The Department showed that the restrictions are unnecessary
because no network has monopsony power in the acquisition of
television programming and no network is likely to acquire
monopoly power in syndication if the decree restrictions are
removed. The Department also showed that the decree restrictions
might themselves be anticompetitive. The district court
considered the comments and briefs of California and the
Coalition, which opposed modification of the decree. But the
court concluded that they had presented no evidence supporting
Page 28.
their contentions that the proposed modification would have
anticompetitive effects. (See Coal. App. 175-78.) Accordingly,
it found the modification to be in the public interest and
approved it.
California and the Coalition disagree with the district court's
conclusion, but it is correct and amply supported by the
record.27 Indeed, movants do not even
identify any controlling legal or factual issue that would raise
a substantial question about the district court's public interest
holding, much less any reason why this Court would be likely to
reverse the district court's modification order if California and
the Coalition were permitted to appeal.
II. THE EQUITIES DO NOT FAVOR ISSUANCE OF A STAY
Finally, a stay must be denied because movants will not suffer
irreparable injury absent a stay; the balance of equities between
movants and the Networks weighs against a stay; and further delay
in removing decree restrictions that the Department and the court
have determined are unnecessary and anticompetitive would be
contrary to the public interest in competition.
California and the Coalition are not parties to the decree, and
neither the decree nor the modifications impose any obligations
Page 29
on the members of the Coalition or the people of the State of
California. The modifications remove restrictions that applied
only to the Networks. Thus the Networks, in competition with
studios and other syndicators, now may acquire and hold financial
interests and syndication rights in prime-time network
entertainment programs.28 Coalition members and other
producers that receive offers from Networks to transfer such
rights will have a new financing option. But nothing in the
modification compels producers to transfer any rights to the
Networks or penalizes them if they decline the Networks' offers.
Nonetheless, the Coalition asserts (Motion at 34-35) that,
absent a stay, the Networks somehow would compel independent
producers to grant financial interests and would exclude from
Network broadcast programs in which they do not obtain financial
interests. Whatever concerns the Coalition may have about
anticompetitive Network conduct are unsupported by the record and
contrary to the district court's public interest finding. As the
district court and the Department explained, the Networks have no
market power that would enable them to compel transfer of
financial interests and syndication rights for less than a
competitive price.
Page 30.
It may well be true that, absent a stay, the Networks will seek
to acquire financial interests in independently produced
television programs, and that some producers -- including members
of the Coalition -- will find it in their interests to transfer
such rights to the Networks. But such voluntary transactions
would not be attributable to any anticompetitive Network conduct
and would not cause any antitrust injury (much less any that
could not be remedied by monetary damages).29
California also claims that it will suffer irreparable harm
absent a stay "because of the effect the modification will have
on the television industry . . . [which] is a vital part of the
California economy." Cal. Motion at 9. These derivative claims,
like the Coalition's, are contrary to the findings of the
district court.
Movants' delay in seeking review of the denial of intervention
further weakens their claim for equitable relief pending appeal.
The United States recognizes that the present appeals from the
November 1993 orders denying intervention are timely. (See Coal.
Motion at 12, (citing Ingram v. Acands, Inc., 977 F.2d 1332,
1337-39 (9th Cir. 1992)). But Ingram and the cases discussed
therein also indicate that movants were not required to await a
written order before seeking review in this Court of Judge
Page 31
Kelleher's October 1992 oral ruling. Ingram, 977 F.2d at 1339.
Had movants sought such review more promptly, their appeals
likely would have been resolved well in advance of the district
court's ruling on the modification motions.30
On the other side of the balance of private interests, a stay
will continue to prevent the Networks -- and any producers who
may wish to sell financial interests and syndication rights in
their programs to the Networks -- from entering into efficient
and mutually advantageous arrangements. While we cannot quantify
the harms to these private interests, they weigh against any stay
of the modification order.
Moreover, public interest considerations weigh against issuance
of a stay. First the Department and then the district court
carefully analyzed the proposed modifications, taking into
account the views of California, the Coalition and other
interested persons. Based on this careful review, the Department
concluded and the court agreed determined that the decree
modification will further the public interest in competition. In
addition, the FCC recently found it in the public interest to
lift its rules prohibiting Network ownership of financial
interests and syndication rights. (See NW App. 340-45.) The
Page 32.
public also would be denied the benefits of the FCC's decision if
the district court's order modifying the decrees were stayed.
The impact on the public of a stay is difficult to quantify, but
it may be some time before these appeals are resolved, and
further delay in removing unnecessary and anticompetitive
restrictions plainly would be contrary to the public interest in
competition.
Of course, a stay would preserve the status quo, and that might
serve certain producers' private interests in avoiding
competition or increasing their bargaining power for as long as
the appellate process takes. After a final judgment, however,
the general rule is not to preserve the status quo but to give
prevailing parties the benefits of their judgment. Here, none of
the relevant factors supports a stay: all parties to the decrees
-- the United States and the Networks -- are in agreement that
the modifications should take effect; any likelihood that
California and the Coalition will secure reversal of the denial
of intervention and of the modification order is extremely
remote; and the balance of equities weighs heavily against any
stay.
CONCLUSION
This Court should deny the motions for stay. The United States
does not oppose movants' request to expedite the intervention
appeals, provided the United States' brief is due not less than
30 days after service of appellants' briefs.
Page 33
Respectfully submitted.
| |
|
ANNE K. BINGAMAN
Assistant Attorney General
DIANE P. WOOD
Deputy Assistant Attorney General
________________________________
CATHERINE G. O'SULLIVAN
NANCY C. GARRISON
Attorneys
Department of Justice
Appellate Section - Rm. 3224
10th & Pennsylvania Ave., N.W.
Washington, D.C. 20530
(202) 514-1531
|
December 9, 1993
.
FOOTNOTES
1
"Coal. App." refers to the "Appendix for Motion for Stay
Pending Appeal" filed by the Coalition; "Cal. App." refers to the
Appendix filed by the State of California; "NW App." refers to
the Supplemental Appendix filed by the Networks.
2
The Networks' Opposition to the Motions for Stay Pending
Appeal of Intervention Orders, Dec. 9, 1993, provides a complete
chronology of the decree proceedings in the district court and
this Court and of proceedings on the Federal Communications
Commission's financial interest and syndication rules before the
FCC and the Seventh Circuit.
3
Virtually identical decrees were entered against CBS and
ABC in 1980.
4
Memorandum of the United States in Response to Motion of
Defendant [Network] To Modify the Final Judgment, May 7, 1992
("US Modification Mem.") (NW App. 1-53) (In the modification
proceedings, identical memoranda were filed in all three cases.)
5
The Association of Independent Television Stations (INTV),
which has filed a statement amicus curiae in support of the stay
motions, also was among the commenters opposing the modification.
The Federal Trade Commission's Bureau of Economics, Action for
Children's Television, and a group of labor and senior citizens
organizations supported the modification.
6
In December 1992, the Seventh Circuit vacated financial
interest and syndication restrictions imposed by the Federal
Communications Commission. The court of appeals concluded that
the FCC had failed to show that its rules would promote
competition or serve any other public purpose. Schurz
Communications, Inc. v. FCC, 982 F.2d 1043 (7th Cir. 1992).
7
In denying the motions, the district court emphasized that
it had given "all interested persons . . . every opportunity
fully and fairly to state their views and comments that formal
intervention would have granted," and it took into account the
clear Congressional intent not to compel a hearing or trial on
the public interest issue in a consent decree proceeding. 449 F.
Supp. at 1143-44.
8
California does not claim that any statute gives it an
unconditional right to intervene under Fed. R. Civ. P. 24(a)(1).
9
Cal. Motion at 10, 13, 14 n.9 ("The State contended in the
district court that it had a right to intervene under Federal
Rules of Civil Procedure, Rule 24(a) so it could address the
question of whether the modification is in the public interest.
For purposes of this [stay] motion only, the State is not
asserting Rule 24(a) as a ground to intervene on this issue.")
10
In United States v. Motor Vehicle Mfrs. Ass'n, 1981-2
Trade Cas. �,370 (C.D. Cal. 1981), the district court directed
the parties to a consensual modification to follow the Tunney Act
procedures. The court's order, however, did not purport to hold
that the Tunney Act is applicable to all consent modifications as
a matter of law, and more recently the Second Circuit has held
that the APPA is not applicable to judgment modification or
termination proceedings. United States v. American Cyanamid Co.,
719 F.2d 558, 565 n.7 (2d Cir. 1983) (quoting In re International
Business Machines Co., 687 F.2d 591, 600 (2d Cir. 1982)), cert.
denied, 465 U.S. 1101 (1984).
11
California had notice of the procedures proposed in the
United States' May 7, 1993 memorandum and of the court's May 14,
1993 order adopting those procedures. But did not raise any
objections until it submitted its comments to the Department of
Justice on August 7, 1993.
12
Rule 24 governs intervention under the Tunney Act. See
United States v. LTV Corp., 746 F.2d 51, 55 (D.C. Cir. 1984);
United States v. Associated Milk Producers, Inc., 394 F. Supp.
29, 41, 43 (W.D. Mo. 1975), aff'd, 534 F.2d 113 (8th Cir.), cert.
denied, 429 U.S. 940 (1976).
13
Cf. United States v. Bechtel Corp., 648 F.2d 660, 664 (9th
Cir.) (government's failure to comply with Tunney Act time limits
did not preclude entry of decree), cert. denied, 454 U.S. 1083
(1981).
14
American Express Co. v. United States Dep't of Justice,
453 F. Supp. 47 (S.D.N.Y. 1978), does not support California's
contention (Motion at 12) that it should have been allowed to
litigate the Tunney Act issue as an intervenor. The court in
that case dismissed a separate action brought to challenge the
procedures being used in a consent decree modification
proceeding, holding that "any arguments directed to the
applicability of the APPA [Tunney Act] to the modification or
vacation of an existing consent decree are properly made directly
to the court before which such proceedings are pending in the
form of a motion to intervene or otherwise participate in those
proceedings." 453 F. Supp. at 49 (emphasis added).
15
The district court gave the Coalition ample opportunity to
be heard on behalf of its members; thus there is no merit to the
Coalition's argument (Motion at 10) that it should have been
allowed to intervene because it has many members who are "the
past and prospective victims of the networks' anticompetitive
conduct."
Amicus INTV's assertion (Stmt. at 4) that only the Networks and
the Department of Justice were "permitted to place their views
before the court directly," mischaracterizes the district court's
proceedings. The Department of Justice filed all comments
(including California's, the Coalition's and INTV's) with the
court several months before the United States' Response was
filed, and in exactly the form they were submitted to the
Department. INTV did not seek to intervene or to participate in
any hearings, and its interests were not impaired by the rulings
on the intervention motions.
16
The Department of Justice had suggested that the court
afford the Coalition and California an opportunity to present
oral argument on the motions. (See Cal. App. 52; NW App. 354.)
17
The Coalition asserts (Coal. Motion at 9) that "Judge
Kelleher did not find that the Coalition had failed to satisfy
the requirements of Fed. R. Civ. P. 24(b)." Coal. Mem. 7, 20.
That finding, however, was implicit in his ruling that the
motions were denied. Further, Judge Real expressly stated that
he had considered all the submissions, and there is no reason to
believe that he or Judge Kelleher failed to consider any factors
he was required to take into account under Rule 24(b). In any
event, this Court "may affirm a decision of the district court
. . . on any ground finding support in the record. If the
district court decision is correct, it must be affirmed, even if
the court relied on wrong grounds or wrong reasoning." United
States v. $129,374 in United States Currency, 769 F.2d 583, 586
(9th Cir. 1985) (citations omitted) (affirming denial of
intervention of a right), cert. denied, 474 U.S. 1086 (1986).
18
In Cyanamid, the Second Circuit affirmed the grant of
permissive intervention to MCI, a direct beneficiary of the
decree requirement that defendant Cyanamid purchase a specified
amount of melamine from unaffiliated United States producers. It
held that the district court had not abused its discretion in
granting intervention where "the applicant's claims that
termination would have an anticompetitive effect . . . are
directly related to the ultimate questions" before the court and
"that no undue delay would result from granting leave to
intervene." 719 F.2d at 563.
19
Rule 24(a) governs intervention of right, and adequacy of
representation is only one of the four criteria that an applicant
claiming a right to intervene must satisfy. Moreover, the
Coalition did not move to intervene under Rule 24(a).
20
The only government antitrust case of which we are aware
in which a denial of intervention has been reversed is Cascade
Natural Gas Corp. v. El Paso Natural Gas Co., 386 U.S. 129
(1967). That case involved a unique situation. After the
Supreme Court had found a violation of section 7 of the Clayton
Act and directed "`divestiture without delay,'" 386 U.S. at 131
(quoting United States v. El Paso Natural Gas Co., 376 U.S. 651,
662 (1964)), the Department of Justice agreed to a decree
inconsistent with the Supreme Court's mandate, thus failing
adequately to represent the public interest in competition, 386
U.S. at 135-36.
21
Even where an applicant satisfies the other criteria for
intervention of right, this Court has recognized that
"inconvenience . . . caused by requiring [an applicant] to
litigate separately is not the sort of adverse practical effect
contemplated by Rule 24(a)(2)." Blake v. Pallan, 554 F.2d 947,
954 (9th Cir. 1977); see 7C Wright, supra, �08 at 311-12 (the
practical disadvantages of filing a separate suit and perhaps
duplicating some of the efforts in the ongoing action are not
sufficient to warrant intervention of right).
22
"[W]here no party appeals, the `case or controversy'
requirement of Article III also qualifies an applicant's right to
intervene post-judgment." Id.
23
Further, the only claim to intervene of right that is at
issue on this motion involves California's contention that the
Tunney Act applies, and any error in that ruling was harmless.
See pp. 13-15, supra.
24
See, e.g., Bethune Plaza, Inc. v. Lumpkin, 863 F.2d 525
(7th Cir. 1988) ("The prospect that a new party might string out
a case that the original parties want to resolve usually is a
compelling objection to intervention rather than a reason to
allow it").
25
Cf. United States v. Western Elec. Co., 1991-2 Trade Cas.
(CCH) �,610 (D.C. Cir. 1991) (vacating district court's stay
pending intervenors' appeal of decision removing antitrust
consent decree restriction; "[t]he stay was an abuse of
discretion" because there was insufficient evidence of
probability that order would be reversed, that denial of stay
would cause irreparable injury or that the public interest would
be served by the stay).
26
See also, e.g., United States v. Western Elec. Co., 993
F.2d 1572, 1576-78 (D.C. Cir.), cert. denied, 114 S. Ct. 487
(1993) (district court may reject a modification that is not
opposed by any party to the decree, "only if it has exceptional
confidence that adverse antitrust consequences will result")
(citing Bechtel); United States v. Mid-America Dairymen, Inc.,
1977-1 Trade Cas. (CCH) �,508 (W.D. Mo. 1977) (while the Tunney
Act requires an "independent public interest determination," the
court is not to make a "de novo determination of facts and
issues").
27
As the district court noted (Coal. App. 176-78) the FTC's
Bureau of Economics agreed with the Department's conclusion that
removal of the financial interest and syndication restrictions
was very unlikely to present a risk to competition while
continuing the restrictions was likely to be anticompetitive, and
the Seventh Circuit, in vacating the FCC's 1990 "fin/syn" rules
reached essentially the same conclusions. Schurz, supra.
28
The networks remain subject to FCC rules, which prohibit
active syndication. (See NW App. 340-45.) Thus movants' and
INTV's (INTV Stmt. at 5-6) concerns about Network participation
in syndication are premature as well as contrary to the evidence.
29
Of course, the Coalition's members would not be entitled
to a stay of a decision in a government antitrust case in order
to prevent any losses they might sustain merely from having to
compete with networks for financial interests.
30
California (Motion at 7) argues that a stay is necessary
to prevent irreparable harm because, absent a stay, "it is likely
that the Networks and the United States will argue that the order
modifying the consent decree became final while the appeal was
pending." But the modification order already is final, and a
stay would not change that.
|