Time Warner and the National Cable Television Assn. have each filed suit asking a federal court to overturn new cable rate regulations designed to reduce consumer rates an estimated $ 1 billion nationwide.The suits were filed this week in the D.C. Circuit Court of Appeals. Both Time Warner and NCTA claim the Federal Communications Commission regs violate the First Amendment rights of cable operators. NCTA called the FCC rules “arbitrary, capricious and otherwise contrary to law.” Moreover, the trade org said, the FCC overstepped its statutory jurisdiction when it passed the 1992 Cable Act. In April, the FCC froze cable rates and issued a complex set of rules designed to reduce monthly bills by an average 10% nationwide. Preliminary reports gathered by the agency show that in cable systems that did not switch to an a la carte pricing scheme, two-thirds of all customers have seen an average $ 2 drop in monthly bills. However, one-third of cable customers have seen an increase in cable rates. That finding has prompted the FCC to set in motion plans for a broad inquiry into whether cablers have illegally skirted the intent of the FCC rules. This week’s suit represents the latest legal challenge to provisions of the 1992 Cable Act. Although federal courts have upheld key parts of the bill such as must-carry and retransmission consent, the Supreme Court ultimately will decide the constitutionality of the legislation.
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