Ted Turner’s Superstation in the Crosshairs

In 1969 Ted Turner, the now famous media mogul, bought a defunct Atlanta UHF (Ultra High Frequency) television station and put it back on the air as WTCG. As an over-the-air station, it also was microwave-linked to many cable companies in the Southeastern U.S. In December 1976, however, Turner through his company (Turner Broadcasting System, Inc.) decided to offer his station nationwide via satellite to all cable companies. By 1978 it was on cable systems in all 50 states and became known as a “superstation.”[1]

The company that carried the station’s signal to the satellite was Southern Satellite Systems, Inc.  under a license from the Federal Communications Commission (FCC). Initially Southern Satellite received the signal over the air by a UHF receiving antenna and then retransmitted it to a satellite transponder leased from RCA. The satellite transponder in turn relayed the signal down to cable systems’ receiving antennae on earth, and those systems retransmitted the signal by wire to cable customers.

In March 1979, pursuant to FCC permission, Southern Satellite began to receive the WTBS signal by direct microwave connection, instead of off the air except when the former was not operating. Under this approach, WTBS was able to send local commercials over the air in Atlanta and national commercials via the microwave connection to Southern Satellite.

WTBS’ programming included old movies like the classic “Casablanca” with Humphrey Bogart and Ingrid Bergman and old syndicated television programs like “The Bob Newhart Show” and “I Dream of Jennie,” under licensing agreements, exclusive to the Atlanta area, with the owners of the copyrights.

This “superstation” operation was challenged by Hubbard Broadcasting, Inc., a Minnesota corporation headquartered in Minneapolis. It owned television broadcast stations in Minneapolis/St. Paul, Tampa/St. Petersburg, Florida and Albuquerque, New Mexico that had exclusive copyright licenses for “Casablanca,” “The Bob Newhart Show” and “I Dream of Jennie.” All three of these Hubbard stations were in areas reached by the satellite-carried signal of WTBS.

The case, which was filed in Minnesota’s federal court,[2] alleged that Southern Satellite and Turner Broadcasting had violated the copyrights on these programs that had been licensed to Hubbard. The key issue for these claims was whether Southern Satellite qualified for the common carrier exemption in section 111 of the Copyright Act of 1976. This exemption existed for carriers that acted merely as a conduit between the distant broadcast station and the interested cable systems. I served as the principal lawyer for Southern Satellite in this case.

The Minnesota district court eventually concluded that Southern Satellite did qualify for this exemption and, therefore, granted its motion for summary judgment without a trial. The appellate court affirmed this decision.[3]

During the pre-trial discovery phase of the case, Hubbard’s attorneys took the deposition of Ted Turner in Atlanta. This was during the 1982 NFL players’ strike when Turner Broadcasting joined others in arranging games by substitute players. These substitute games were not well attended or watched on tv on the first weekend, and Turner was busy at his company making arrangements for the second weekend of such games.[4] At his request because of the press of business, his deposition was held at his company’s headquarters.

His regular outside counsel in Atlanta told me before the deposition that Turner was a tobacco chewer, and some of his depositions in other cases were shorter than anticipated because the female lawyers asking the questions were grossed out by his tobacco chewing and spitting his expectorate into a paper cup during the deposition. (This, however, was not a problem for Hubbard’s attorney.)

After the deposition, I joined Turner and his lawyer in Ted’s office to review the just completed deposition. I noticed the many sailing trophies in the room. (In 1977 he was the captain of the yacht that won the America’s Cup, was Yachtsman of the Year four times and recently was elected to the National Sailing Hall of Fame.[5])

This obviously was a very important case for both sides and was vigorously contested at the trial court, court of appeals and Supreme Court levels. Throughout it all, however, I had a thoroughly professional relationship with Hubbard’s attorneys, Sidney Barrows, Byron Starns and Patricia Schaffer of the Minneapolis firm of Leonard Street and Deinard. As noted elsewhere, unfortunately this was not always true in my career of lawyering.[6]

I, therefore, came to believe that is was important for attorneys publicly to acknowledge when lawyers live up to the best of the profession. Accordingly at the conclusion of this case’s hearing on cross motions for summary judgment at the district court, I told the court, “I would like to express my appreciation to Sidney Barrows and to Byron Starns and their law firm as well as John McDonough [Hubbard’s in-house lawyer]. This has been a lawsuit in which the adversaries have dealt very harshly with one another in terms of the legal issues, but in terms of professional relationships it has been great. I appreciate that.” Mr. Barrows responded, “It is in line with what Your Honor said in another argument about our being a noble profession.” The Judge said, “I sense that too and I appreciate it.”[7]