Court blocks Trump FCC order that could flood broadcast TV with more election ads

Republicans demanded that parties and fundraising committees be given lowest ad rates.

A federal appeals court yesterday blocked a Trump administration decision that could have resulted in even more political advertisements appearing on broadcast television during the upcoming elections.

The Federal Communications Commission recently ordered broadcasters to offer the lowest advertising rates to political parties and joint fundraising committees. Four Democratic candidates challenged the decision in court, saying that only individual candidates are entitled under US law to receive what is called the “lowest unit charge,” or LUC.

In a 2-1 vote, a judges’ panel at the US Court of Appeals for the 4th Circuit agreed with the candidates and set aside the FCC decision that was scheduled to take effect on September 4. That’s the start date of the 60-day period before the election in which broadcasters must offer the lowest ad rates to qualified candidates.

“There is no question that candidates are entitled to the LUC,” the ruling said. “But it is disputed whether political parties and joint fundraising committees with non-candidate members can also be entitled to the LUC.”

The FCC Media Bureau asserted in a March 30 public notice that parties and authorized committees designated by candidates can get the discounts. The National Republican Congressional Committee and National Republican Senatorial Committee supported the FCC’s position during the court case.

“Major blow to Republicans”

The judges’ panel said the FCC and Republican committees are wrong. The LUC rule “and campaign finance statutes are clear that neither political parties nor joint fundraising committees with non-candidate members can be entitled to the LUC. We therefore grant the Petition for Review, such that we set aside and hold for naught the Public Notice,” the ruling said.

US law requires the lowest ad rates for “any person who is a legally qualified candidate for any public office.” The judges’ panel decided that “the statutory text is unambiguous, and it provides no support for the Media Bureau’s significant and unilateral expansion of the LUC requirement.”

The ruling was written by Judge Robert King, a Clinton appointee. He was joined in the majority by Judge James Wynn, an Obama appointee, who also wrote a concurring opinion. A dissent was filed by Judge J. Harvie Wilkinson III, a Reagan appointee.

The ruling came in response to a suit filed by former senator and current candidate Sherrod Brown (D-Ohio); Sen. Jon Ossoff (D-Ga.); Senate candidate Roy Cooper (D-N.C.), the former governor of North Carolina; and US Rep. Kristen McDonald Rivet (D-Mich.). The candidates’ law firm called yesterday’s decision a “major blow to Republicans.”

“Congress created the lowest unit charge for federal candidates, and the Fourth Circuit confirmed today that candidate means candidate, not political party or joint fundraising committee,” said a statement issued by Elias Law Group partners Rachel Jacobs and Jacquelyn Lopez. “This ruling is a huge blow to the Republican Party, which was hoping to throw a lifeline to its weak and failing federal campaigns by paying for television advertising at low rates that Congress reserved for federal candidates alone.”

Supreme Court struck down coordination limits

Elias Law Group said the FCC decision on TV ads took on new significance in June when the Supreme Court “struck down longstanding limits on how much party committees may spend in coordination with their federal candidates” in National Republican Senatorial Committee v. Federal Election Commission. The Supreme Court ruling “did not address whether parties can access the federal candidate discount when they engage in coordinated spending,” leaving the TV advertisement question to be decided by lower courts, Elias Law Group said.

The Democratic candidates pointed out that in the recent Supreme Court case, the US solicitor general stated that the LUC statute “require[s] broadcasters to charge low rates for candidate spending, but not for party spending—whether coordinated or independent.” They argued that the FCC’s position is inconsistent with the US solicitor general’s.

FCC Commissioner Anna Gomez, the only Democrat on the commission, issued a statement yesterday saying the FCC decision would “unleash [a] flood of dark money into broadcast advertising” and give “the biggest political spenders an even bigger advantage over everyone else by expanding the candidate-only discount.” She issued the statement shortly before the 4th Circuit ruling came out.

“Broadcasters are being directed to slash prices and sell their most valuable inventory during their busiest and most lucrative season, even as this same FCC has spent months arguing broadcasters need economic and regulatory relief to compete with Big Tech and streaming,” Gomez said. “You cannot claim broadcasters are struggling to survive and then force them into a fire sale on the one thing that could actually help them compete and increase revenue.”

FCC didn’t rule on candidates’ petition

The four candidates petitioned the FCC to reconsider its decision on April 29. A broadcast station trade group, the Television Bureau of Advertising, petitioned the FCC on the same day. The FCC denied the trade group’s petition on August 13 but didn’t issue a decision on the four candidates’ similar petition. Gomez dissented and criticized the FCC for making the decision behind closed doors, with no public docket or call for public comments.

The 4th Circuit judges said the matter is time-sensitive, given the upcoming election season and the fact that the candidates’ application has been pending at the FCC for over 100 days. The candidates asked the court to intervene on June 19.

“Despite the time-sensitive nature of these proceedings, the Commission intentionally took no action and offered no response to the Application for more than three months,” judges said. “The Commission did not, for example, seek responses from impacted parties, or engage in fact finding, or secure supplemental briefing, or solicit public comment, or schedule or conduct an oral argument.”

Instead of assessing the merits of the application, FCC Chairman Brendan Carr this month “proposed the summary dismissal of the Application as unreviewable by the Commission,” the court ruling said. The judges said the “unusual circumstances” amount to a “constructive denial.” They found that the FCC Media Bureau’s public notice constitutes a final order, giving the court jurisdiction to review it.

Court: Agency gave no “statutory justification”

The FCC recognized in 1991 that only candidates, and not independent entities that support or oppose candidates, are entitled to the lowest rates, the 4th Circuit ruling said. Despite that, the FCC public notice in March presented the new guidance as a “remind[er]” that merely “restate[s] previous Media Bureau guidance regarding LUC eligibility.”

The FCC public notice identified no previous Media Bureau guidance to support its claim that political parties and joint fundraising committees with non-candidate members can be entitled to the LUC, judges wrote. “Rather than heeding the plain language of the LUC requirement, the Public Notice requires broadcasters to extend the LUC to political parties and joint fundraising committees with non-candidate members, without providing any statutory justification for that rule,” the ruling said.

The FCC public notice said that US law “repeatedly refers to candidates and their authorized committees as sharing the rights it confers,” and that candidates may designate an authorized committee that is “established solely for the purpose of joint fundraising.”

The 4th Circuit judges countered that the LUC requirement in US law “is limited to ‘use… by’ the candidate, and it says nothing about ‘authorized committees.’” Joint fundraising committees do not have their own contribution limits and may collect “the total amount that the contributor could contribute to all of the participants,” the ruling said.

A joint fundraising committee buying ads at the lowest rate would be spending money it received in contributions to a “non-candidate committee,” the ruling said. The judges’ ruling also said a political party cannot be an authorized committee for a single candidate because each party supports multiple candidates.

FCC welcomes judge’s dissent

Wilkinson’s dissent argued that the public notice is not a “final order” because the FCC is still reviewing the candidates’ application. He also said Congress did not limit the lowest ad rates to ads paid for by a candidate, and that the FCC offered a “natural and plausible” interpretation of the law’s reference to “use… by” a candidate.

“A candidate does not stop ‘using’ a broadcast station just because his or her authorized message employs a party-coordination mechanism,” Wilkinson wrote. He concluded that “instead of following the Supreme Court’s lead, the majority adopts a miserly and constitutionally suspect statutory construction of ‘use’ by a ‘candidate,’ needlessly restricting political speech in the sensitive period leading up to an election. I would not neuter a federal agency and seize imaginary jurisdiction only to disfavor the place of political parties in our democratic dialogue and to dampen the vigor of pre-election political speech. I respectfully dissent.”

The FCC could ask for a rehearing in front of all the court’s judges or seek review by the Supreme Court. An FCC spokesperson said in a statement provided to Ars: “We welcome and appreciate Circuit Judge J. Harvey Wilkinson’s sound and thoughtful analysis as well as his dissenting opinion, which align with the FCC’s longstanding approach to these issues. We will continue to review the other opinions.”