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Carlin Communications Inc. v. Federal Communications Commission

November 2, 1984

CARLIN COMMUNICATIONS, INC., AND DRAKE PUBLISHER, INC., PETITIONERS,
v.
FEDERAL COMMUNICATIONS COMMISSION, RESPONDENT; CARLIN COMMUNICATIONS, INC., CAR-BON PUBLISHERS, INC., AND DRAKE PUBLISHER, INC., PLAINTIFFS-APPELLANTS, V. WILLIAM FRENCH SMITH, AS ATTORNEY GENERAL OF THE UNITED STATES, AND FEDERAL COMMUNICATIONS COMMISSION, DEFENDANTS-APPELLEES



Appeal from an order of the United States District Court for the Southern District of New York (Motley, Chief Judge) denying a motion for a preliminary injunction against the enforcement of 47 U.S.C. § 223(b). Petition for review of a regulation promulgated by the Federal Communications Commission under the authority of 47 U.S.C. § 223(b). Order of the district court affirmed; petition granted and regulation set aside as violative of the First Amendment.

Author: Oakes

Before: OAKES, KEARSE, and PRATT, Circuit Judges.

OAKES, Circuit Judge:

Carlin Communications, Inc. provides a telephone "service," colloquially called "dial-a-porn," to local and long distance callers at ordinary rates. The callers hear prerecorded messages, which change several times daily as in the case of weather or sports results, describing actual or simulated sexual activity apparently in explicit terms. A dial-it service can receive up to 50,000 calls per hour to an individual number, and, rather incredibly, 800,000 calls per day were made to dial-a-porn in May, 1983; 180,000,000 calls in the year ending February, 1984. Dial-a-porn, accessible by calls to or in the Metropolitan New York area codes 212, 516, and 914, all to the 976 exchange, was far more popular than the horse-race results, the second most popular dial-it service, which received 79,000 calls per day or 29,000,000 per year. Eighty percent of dial-a-porn calls are local, and twenty percent long distance.

Drake Publishing began offering dial-a-porn in the New York area in February of 1983. Carlin replaced Drake the following month and has since expanded to several cities, advertising the dial-a-porn numbers in adult-type magazines owned by Drake and Car-bon Publishers, Inc. Under the New York leased-line tariffs, Carlin makes two cents per local or long distance call, and the telephone companies -- for local calls, New York Telephone Co. and New England Telephone Co., now the NYNEX Telephone Companies (hereinafter NYNEX), and for long distance calls American Telephone & Telegraph Co. (hereinafter AT&T) and NYNEX -- receive the remaining revenues.

The instant case is really two cases. In one, No. 84-4086, Carlin and Drake petition for review of an FCC rulemaking order or regulation*fn1 promulgated in response to a statute, 47 U.S.C.A. § 223(b) (Supp. 1984,*fn2 mandating FCC action. In the Second case, No. 84-6202, Carlin Drake and Car-bon*fn3 appeal from the denial of a preliminary injunction against enforcement of section 223(b) by the United States District Court for the Southern District of New York, Constance Baker Motley, Chief Judge. We affirm the judgment in the appeal, No. 84-6202. We grant the petition to review in No. 84-4086 and set aside the regulation.

THE UNDERLYING STATUTE AND REGULATIONS

The drive to regulate dial-a-porn began when the County Executive for Suffolk County, New York, Peter F. Cohalan, commenced an action against Carlin and the FCC in New York state court, since dismissed.*fn4 Subsequently Cohalan and a member of Congress, Thomas J. Bliley (R-Va.) sought to have the FCC terminate Carlin's dial-a-porn service by administrative action under then existing legislation, but the FCC concluded that federal law did not restrict dial-a-porn.*fn5 In light of the FCC's inaction, Congressman Bliley proposed an amendment to section 223 of the Communications Act, 47 U.S.C. § 223 (1982), as a rider to H.R. 2755, 98th Cong., 1st Sess. (1983), the FCC appropriations bill. The House Committee on Energy and Commerce agreed to Congressman Bliley's amendment to H.R. 2755 by voice vote on June 30, 1983, and reported the bill to the full House on September 15, 1983. The legislation prohibited obscene dial-a-porn service:

Section 8 amends section 223 of the Communications Act of 1934 by adding a new subsection (b) . . . that extends section 223's prohibition against obscene telephone calls to prerecorded messages. Obscene messages, whether made directly or by recording device, are prohibited without regard to whether the sender of the message initiated the call. The Committee intends that this section will prohibit obscene messages otherwise available over "Dial It" services.

H.R. Rep. No. 356, 98th Cong., 1st Sess. 19 (1983).

With discussion on the floors of both Houses of Congress on November 18, 1983, the legislation was amended into its present form before being passed.*fn6 The amendment explicitly covered "indecent" language and authorized the FCC to promulgate defenses to the Act's coverage. 129 Cong. Rec. H10,559-60 (daily ed. Nov. 18, 1983); id. at S10,866-67. Congressman Bliley indicated that "indecent" was to be defined by FCC v. Pacifica Foundation, 438 U.S. 726, 57 L. Ed. 2d 1073, 98 S. Ct. 3026 (1978) (upholding FCC adjudication that specific broadcast was "indecent" as distinct from obscene).*fn7 On December 8, 1983, the legislation was signed by the President.*fn8

In the wake of section 223(b)'s passage, the Commission initiated notice and comment rulemaking proceedings. See 48 Fed. Reg. 43,348 (1983); 49 Fed. Reg. 2124 (1984). On June 4, 1984, the Commission issued a Report and Order, 49 Fed. Reg. 24,996 (1984), containing the legislatively mandated regulation establishing defenses to prosecution under section 223(b). The regulation, id. at 25,003, provides:

It is a defense to prosecution under Section 223(b) of the Communications Act of 1934, as amended, 47 U.S.C. § 223(b) (1983), that the defendant has taken either of the following steps to ...


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