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U.S. Supreme Court

Community Communications v. City of Boulder, 455 U.S. 40 (1982)

Community Communications Co., Inc. v. City of Boulder

No. 81350

Argued October 13, 1981

Decided January 13, 1982

455 U.S. 40


Respondent city of Boulder is a "home rule" municipality, granted by the Colorado Constitution extensive powers of self-government in local and municipal matters. Petitioner is the assignee of a permit granted by a city ordinance to conduct a cable television business within the city limits. Originally, only limited service within a certain area of the city could be provided by petitioner, but improved technology offered petitioner an opportunity to expand its business into other areas, and also offered opportunities to potential competitors, one of whom expressed interest in obtaining a permit to provide competing service. The City Council then enacted an "emergency" ordinance prohibiting petitioner from expanding its business for three months, during which time the Council was to draft a model cable television ordinance and to invite new businesses to enter the market under the terms of that ordinance. Petitioner filed suit in Federal District Court, alleging that such a restriction would violate 1 of the Sherman Act, and seeking a preliminary injunction to prevent the city from restricting petitioner's proposed expansion. The city responded that its moratorium ordinance could not be violative of the antitrust laws because, inter alia, the city enjoyed antitrust immunity under the "state action" doctrine of Parker v. Brown, 317 U. S. 341. The District Court held that the Parker exemption was inapplicable and that the city was therefore subject to antitrust liability. Accordingly, the District Court issued a preliminary injunction. The Court of Appeals reversed, holding that the city's action satisfied the criteria for a Parker exemption.

Held: Boulder's moratorium ordinance is not exempt from antitrust scrutiny under the Parker doctrine. Pp. 455 U. S. 48-57.

(a) The ordinance cannot be exempt from such scrutiny unless it constitutes either the action of the State itself in its sovereign capacity or municipal action in furtherance or implementation of clearly articulated and affirmatively expressed state policy. Pp. 455 U. S. 48-51.

(b) The Parker "state action" exemption reflects Congress' intention to embody in the Sherman Act the federalism principle that the States possess a significant measure of sovereignty under the Federal Constitution. But this principle is inherently limited: ours is a "dual system of

Page 455 U. S. 41

government," Parker, supra, at 317 U. S. 351, which has no place for sovereign cities. Here, the direct delegation of powers to the city through the Home Rule Amendment to the Colorado Constitution does not render the cable television moratorium ordinance an "act of government" performed by the city acting as the State in local matters, so as to meet Parker's "state action" criterion. Pp. 455 U. S. 52-54.

(c) Nor is the requirement of "clear articulation and affirmative expression" of a state policy fulfilled here by the Home Rule Amendment's "guarantee of local autonomy," since the State's position is one of mere neutrality respecting the challenged moratorium ordinance. This case involves city action in the absence of any regulation by the State, and such action cannot be said to further or implement any clearly articulated or affirmatively expressed state policy. Pp. 455 U. S. 54-56.

(d) Respondents' argument that denial of the Parker exemption in this case will have serious adverse consequences for cities, and will unduly burden the federal courts, is simply an attack upon the wisdom of the longstanding congressional commitment to the policy of free markets and open competition embodied in the antitrust laws, which laws apply to municipalities not acting in furtherance of clearly articulated and affirmatively expressed state policy. Pp. 455 U. S. 56-57.

630 F.2d 704, reversed and remanded.

BRENNAN, J., delivered the opinion of the Court, in which MARSHALL, BLACKMUN, POWELL, and STEVENS, JJ., joined. STEVENS, J., filed a concurring opinion, post, p. 455 U. S. 58. REHNQUIST, J., filed a dissenting opinion, in which BURGER, C.J.,and O'CONNOR, J., joined, post, p. 455 U. S. 60. WHITE, J., took no part in the consideration or decision of the case.

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