High Court Prospect Hardiman Left FCC Auction Results Alone Despite Mixed DE Rulings

Supreme Court prospect Thomas Hardiman has ruled for and against FCC rules governing small business bidding credits in wireless spectrum auctions, but never reversed auction results. The judge of the 3rd U.S. Circuit Court of Appeals since 2007 reportedly remained in contention to replace retiring Justice Anthony Kennedy on the high court, along with the D.C. Circuit's Brett Kavanaugh, the 6th Circuit's Raymond Kethledge and the 7th Circuit's Amy Coney Barrett. Kavanaugh has by far the most extensive record on telecom and media law. Kavanaugh -- in dissenting from 2017's USTelecom ruling (here) upholding the FCC's 2015 net neutrality order -- and Kethledge (here) have voiced skepticism about broadly deferring to regulatory agencies on ambiguous statutes under the Chevron doctrine (see 1807040001). President Donald Trump planned to have announced his nominee Monday night.

Hardiman has authored three opinions on FCC "designated entity" rules, which govern bidding credits for qualified small businesses in spectrum auctions. In 2007, a three-judge panel including Hardiman dismissed on procedural grounds a petition for review that could have overturned the commission's 2006 AWS-1 auction, which received net bids of $13.7 billion. Seeking to prevent DE abuse by parties affiliated with large wireless incumbents, Council Tree (and others) had challenged competitive bidding rules without waiting for an FCC order on a reconsideration petition to become official. "Petitioners’ petition for review is incurably premature because the Second Order is non-final, and the Reconsideration Order had not been published in the Federal Register," wrote Hardiman for the unanimous panel in Council Tree (see 0710010128), which left petitioners free to try again.

In 2010, Hardiman and two others ruled against some DE rules approved prior to the AWS-1 auction and used for a 700 MHz auction in 2008 that netted $19 billion in winning bids. But rejecting petitioners' request to undo the results of both auctions, the panel said the record gave no indication that winning bidders "were anything but innocent third parties" in the "improper" FCC rulemaking. "We are thus loath to rescind the results of the auctions, since it would involve unwinding transactions worth more than $30 billion, upsetting what are likely billions of dollars of additional investments made in reliance on the results, and seriously disrupting existing or planned wireless service for untold numbers of customers," wrote Hardiman in a second unanimous Council Tree ruling. "The possibility of such large-scale disruption in wireless communications would have broad negative implications for the public interest in general" (see 1008250077).

A year ago, Hardiman and still others rejected Council Tree's challenge to an FCC decision imposing a $150 million bidding credit cap on DEs in the TV incentive auction. "The question presented here is whether the FCC acted legally when it limited the bidding credits available to DEs. We hold that it did," wrote Hardiman in a third 3-0 Council Tree ruling (see 1707130069).

Hardiman also has authored at least two other communications-related rulings. In 2017's Noreen Susinno v. Work Out World, he and two colleagues vacated and remanded a district court ruling that had dismissed Susinno's Telephone Consumer Protection Act claim. In 2016's Elliott J. Schuchardt v. President of the United States, Hardiman and two others vacated and remanded a district court ruling that had dismissed a complaint challenging an electronic surveillance program run by NSA under Section 702 of the Foreign Intelligence Surveillance Act.

Kethledge, a 6th Circuit judge since 2008, wrote a 2016 panel ruling that upheld as constitutional a warrantless police search that gathered location data from the wireless provider of a suspect before charging him, in U.S. v. Timothy Ivory Carpenter. But the Supreme Court June 22 ruled 5-4 that under the Fourth Amendment police generally need a warrant to collect cellphone location data from carriers in Carpenter v. U.S. (see 1806220052).

We couldn't find communications law rulings by Barrett, a 7th Circuit judge since Nov. 2.

It would be wonderful if Trump picked Barrett, said Sen. Orrin Hatch, R-Utah, senior Judiciary Committee member and a former chairman, who said all four apparent contenders would be outstanding. Senate Judiciary Committee Chairman Chuck Grassley, R-Iowa, made the case for "cameras in the courtroom."