NAB reports (Mar-Dec 1933)

has acted within the limits of its authority and to have their rights, as established by law, determined accordingly, there is a case or con¬ troversy which is the appropriate subject of the exercise of judicial power. The provision that in case the Court reverses the decision of the Commission “it shall remand the case to the Commission to carry out the judgment of the Court’’ means no more than that the Commission in its further action is to respect and follow the Court’s determination of the questions of law. The procedure thus contemplates a judicial judgment by the court of appeals, and this Court has jurisdiction, on certiorari, to review that judgment in order to determine whether or not it is erroneous. ( Osborn v. UnitedStates Bank, 9 Wheat. 738, 819; In re Pacific Railway Commission, 32 Fed. 241, 255; Federal Trade Commission v. Klesner, supra; Federal Trade Commission v. Raladam Co., supra; Old Colony Trust Co. v. Commissioner, supra.) Second. In this aspect, the questions presented are (1) whether the Commission, in making allocations of frequencies or wave lengths to States within a zone, has power to license operation by a station in an “under-quota” State on a frequency theretofore assigned to a station in an “over-quota” State and to terminate the license of the latter station; (2) whether, if the Commission has this power, its findings of fact sustain its order in the instant case, in the light of the statutory requirements for the exercise of the power; and if so, whether these findings are supported by sub¬ stantial evidence; and (3) whether, in its procedure, the Commission denied to the respondents any substantial right. 1. No question is presented as to the power of the Congress, in its regulation of interstate commerce, to regulate radio communi¬ cations. No State lines divide the radio waves, and national regu¬ lation is not only appropriate but essential to the efficient use of radio facilities. In view of the limited number of available broad¬ casting frequencies, the Congress has authorized allocation and licenses. The Commission has been set up as the licensing authority and invested with broad powers of distribution in order to secure a reasonable equality of opportunity in radio transmission and reception. The Radio Act divides the United States into five zones, and Illinois and Indiana are in the fourth zone. (Sec. 2, 47 U. S. C. 82.) Except as otherwise provided in the act, the Commission “from time to time, as public convenience, interest, or necessity requires,” is directed to “assign bands of frequency or wave lengths to the various classes of stations and assign frequencies or wave lengths for each individual station and determine the power which each station shall use and the time during which it may operate,” and to “determine the location of classes of stations or individual sta¬ tions.” (Sec. 4 (c) (d), 47 U. S. C. 84.) By Section 9, as amended in 1928, the Congress declared that the people of all the zones “are entitled to equality of radio broadcasting service, both of transmission and of reception,” and that “in order to provide said equality the licensing authority shall as nearly as possible make and maintain an equal allocation of broadcasting licenses, of bands of frequency or wave lengths, of periods of time for operation, and of station power to each of said zones when and insofar as there are applications therefor”; and the Commission is further directed to “make a fair and equitable allocation of licenses, wave lengths, time for operation, and station power to each of the States, * * * within each zone, according to population”; and the Commission is to “carry into effect the equality of broadcasting service, * * * whenever necessary or proper, by granting or refusing licenses or renewals of licenses, by changing periods of time for operation and by increasing or decreasing station power when applications are made for licenses or renewals of licenses.” (Sec. 9, 47 U. S. C. 89.s) By its General Order No. 40, of August 30, 1928* the Commis¬ sion established a basis for the equitable distribution of broadcast¬ ing facilities in accordance with the act. That order, as amended, provided for the required apportionment by setting aside a certain number of frequencies for use by stations operating on clear channels for distant service, and other frequencies for simultaneous use by stations operating in different zones, each station serving a regional area, and still others for use by stations serving city or local areas. These three classes of stations have become known as “clear, re¬ gional, and local channel stations.” A new allocation of frequen¬ cies, power, and hours of operation was made in November 1928,3 4 5 to conform to the prescribed classification. It was found to be due,” based on estimated population, and the “units assigned.” This impracticable to determine the total value of the three classes of 3 See note 1. 4 Report, 1928, Federal Radio Commission, pr> 17, 48. 5 Id,, pp. 18, 215-21,8. ■ Page assignments so that it could be ascertained whether a State was actually “under or over quota on total radio facilities,” and the Commission developed a “unit system” in order “to evaluate sta¬ tions, based on type of channel, power and hours of operation, and all other considerations required by law.” In June 1930 the Com¬ mission issued its General Order No. 92,“ specifying the “unit value” of stations of various types, and in this way the Commission was able to make a tabulation by zones and States showing the “units action called for administrative judgment, and no ground is shown for assailing it. It appears that, with respect to total broadcasting facilities, Indiana is “under quota” and Illinois is “over quota” in station assignments. Respondents contend that the Commission has departed from the principle set forth in its General Order No. 92, because it has ignored the fact that, both Indiana and Illinois being under quota in regional station assignments, Indiana has more of such assign¬ ments in proportion to its quota than has Illinois, and by ordering the deletion of regional stations in Illinois in favor of an Indiana station, the Commission has violated the command of Congress by increasing the under-quota condition of Illinois in favor of the already superior condition of Indiana with respect to stations of that type. We find in the act no command with the import upon which respondents insist. The command is that there shall be a “fair and equitable allocation of licenses, wave lengths, time for operation, and station power to each of the States within each zone.” It cannot be said that this demanded equality between States with respect to every type of station. Nor does it appear that the Commission ignored any of the facts shown by the evidence. The fact that there was a disparity in regional station assignments, and that Indiana had more of this type than Illinois, could not be regarded as controlling. In making its “fair and equitable alloca¬ tions” the Commission was entitled and required to consider all the broadcasting facilities assigned to the respective States, and all the advantages thereby enjoyed, and to determine whether, in view of all the circumstances of distribution, a more equitable adjustment would be effected by the granting of the application of station WJKS and the deletion of stations WIBO and WPCC. To accomplish its purpose the statute authorized the Commission to effect the desired adjustment “by granting or refusing licenses or renewals of licenses by changing periods of time for operation, and by increasing or decreasing station power.” This broad authority plainly extended to the deletion of existing stations if that course was found to be necessary to produce an equitable result. The context, as already observed, shows clearly that the Congress did not authorize the Commission to act arbitrarily or capriciously in making a redistribution, but only in a reasonable manner to attain a legitimate end. That the Congress had the power to give this authority to delete stations, in view of the limited radio facilities available and the confusion that would result from interferences, is not open to question. Those who operated broadcasting stations had no right superior to the exercise of this power of regulation. They necessarily made their investments and their contracts in the light of and subject to this paramount authority. This Court has had frequent occasion to observe that the power of Congress in the regulation of interstate commerce is not fettered by the neces¬ sity of maintaining existing arrangements which would conflict with the execution of its policy, as such a restriction would place the regulation in the hands of private individuals and withdraw from the control of Congress so much of the field as they might choose by prophetic discernment to bring within the range of their enter¬ prises. ( Union Bridge Co. v. United States, 204 U. S. 364, 400, 401 ; Philadelphia Co. v. Stimson, 223 U. S. 605, 634, 638; Philadelphia, Baltimore & Washington R.R. Co. v. Schubert, 224 U. S. 603, 613, 614; Greenleaf Lumber Co. v. Garrison, 237 U. S. 251, 260; Con¬ tinental Insurance Co. v. United States, 259 U. S. 156, 171; Sproles v. Binford, 286 U. S. 374, 390, 391 ; Stephenson v. Binford, 287 U. S. 251, 276; City of New York v. Federal Radio Commission, 36 F. (2d) 115; 281 U. S. 729; American Bond & Mortgage Co. v. United States, 52 F. (2d) 318; 285 U. S. 538; Trinity Methodist Church South v. Federal Radio Commission, 62 F. (2d) 850; 288 U. S. — .) Respondents urge that the Commission has misconstrued the act of Congress by apparently treating allocation between States within a zone as subject to the mandatory direction of the Con¬ gress relating to the zones themselves. Respondents say that as to zones Congress requires an “equal” allocation, but as between States only “a fair and equitable” allocation, and that the provi¬ sion “for granting or refusing licenses or renewals of licenses” re 6 Report, 1930, Federal Radio Commission, pp. 4, 24. 41 •