HOME RUN OR STRIKEOUT? THE UNSETTLED RELATIONSHIP BETWEEN THE SPORTS BROADCASTING ACT AND CABLE PROGRAMMING

By Steven M. Perry¹

I. INTRODUCTION

The Sports Broadcasting Act ("SBA") exempts from the antitrust laws "any joint agreement . . . by which any league of clubs participating in professional football, baseball, basketball, or hockey contests sells or otherwise transfers all or any part of the rights of such league’s member clubs in the sponsored telecasting of the games of football, baseball, basketball, or hockey, as the case may be, engaged in or conducted by such clubs."²

In the 55 years since the SBA was enacted, only a handful of courts have addressed the question of whether the antitrust exemptions contained in the SBA apply to basic cable programming. This article reaches two conclusions with respect to that question. First, and contrary to what various commentators have assumed, no court has ever held that league-wide agreements that license sports programming on basic cable channels are, or are not, exempt from the antitrust laws under the SBA. Second, the application of current principles of statutory interpresentation demonstrates that the SBA’s exemptions do, in fact, apply to basic cable programming.

To be specific, and as discussed in more detail in section II of this article, various commentators have stated that in November 1992, the district court in Chicago Professional Sports Ltd. Partnership v. National Basketball Association³ held that cable programming fell outside the SBA because it did not constitute "sponsored telecasting." Those commentators have, however, overlooked the district court’s clarification one month later, when it explained that it had made no such holding:

"[W]e have not yet ruled on the question of whether the [challenged agreement] is exempt under the SBA. We have merely denied the NBA’s motion for summary judgment that it is."⁴
Three years later, the same court confirmed that it had not yet decided the SBA issue.⁵

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Commentators also (incorrectly) cite a Third Circuit decision for the proposition that basic cable programming does not satisfy the "sponsored telecasting" requirement set out in the SBA. In Shaw v. Dallas Cowboys Football Club Ltd.,⁶ the court addressed the SBA’s application to a commercial-free package of NFL games offered by satellite provider DirecTV. Although the court’s opinion included broad language, the court neither faced nor decided any issue involving sports programming on basic cable channels, where sponsors and their advertisements take up substantial air time, because the issue before the Court involved only commercial-free pay television. Indeed, the district court responsible for implementing the Third Circuit’s mandate on remand explicitly stated that the appellate court’s decision "did not address whether broadcasting the games on the Internet or cable television was an exempt activity under the SBA, but only found that satellite broadcasts of NFL games were not exempted." ⁷

In sum, the question of whether the SBA exempts league agreements with basic cable programmers from antitrust scrutiny remains unsettled. In golfing parlance, the green is open. This article suggests that if a court today were to apply basic principles of statutory interpretation to the relevant language in the SBA, it would find that the SBA does exempt league-wide agreements involving basic cable programming from the antitrust laws. But before we undertake that analysis, some background is in order.

II. A STATUTE IS BORN

A. The Judicial Decision That Prompted Congress to Enact the SBA

The SBA was enacted in large part in response to a district court ruling that the NFL’s sale of a games package to the CBS television network violated section 1 of the Sherman Act.⁸ The court’s decision in 1961 cannot be understood without a discussion of the prior proceedings in the same case that had occurred eight years earlier, in 1953.

In the early 1950’s, some of the twelve NFL teams had individual agreements with the soon-to-be-defunct DuMont Network, which televised a single "Game of the Week" and certain other games.⁹ Because the NFL was concerned about a potential adverse effect of televised games on stadium admissions, it adopted a set of by-laws in 1951 that imposed restrictions on "[a]ny contract entered into by any club for telecasting or broadcasting its games. . . ."¹⁰ The Department ofJustice sued to block the enforcement of several of the restrictions.¹¹

The district court, after a lengthy trial, held that some of the NFL by-laws unreasonably restricted competition in violation of the Sherman Act. In particular, the court struck down a by-law that prohibited the "telecasting" of games into a team’s home territory on a day when that team was playing an away game that was being televised in its home territory.¹² As an example, if Green Bay was playing at Washington, a game that same day between the Bears and the Giants could not be telecast into the Green Bay TV market.

The court held that the NFL had presented "no factual justification for [the] suppression of competing telecasts" in a team’s territory if the team was playing an away game, rather than a home game, on that day.¹³ The court rejected as "speculation" the NFL’s argument that attendance at future home games would decline merely because fans had watched a telecast involving other teams a few weeks earlier.¹⁴

However, the court upheld as reasonable a bylaw that precluded the broadcasting of "outside games" into the home territories of other teams on days when the other team was playing at home.¹⁵ The court observed that:

"Professional teams in a league . . . must not compete too well with each other, in a business way. . . . If all the teams should compete as hard as they can in a business way, the stronger teams would be likely to drive the weaker ones into financial failure. If this should happen not only would the weaker teams fail, but eventually the whole league, both the weaker and the stronger teams, would fail, because without a league no team can operate profitably.¹⁶

The court further concluded that weaker teams "benefit greatly" from a restriction on the telecasting of "outside games" into their home territories on days when they are playing at home, because "its immediate effect is to protect the weak teams and its ultimate effect is to preserve the League itself." ¹⁷ The court held that:

"The purposes of the Sherman Act certainly will not be served by prohibiting the defendant clubs, particularly the weaker clubs, from protecting their home gate receipts from the disastrous financial effects of invading telecasts of outside games. The member clubs of the National Football League, like those of any professional athletic league, can exist only as long as the league exists. The League is truly a unique business enterprise, which is entitled to protect its very existency by agreeing to reasonable restrictions on its member clubs. The first type of restriction imposed by [the by-laws] is a reasonable one and a legal restraint of trade."¹⁸

The court entered a final judgment in 1953 that included a broad prohibition on any agreement that had "the purpose or effect of restricting the areas in which broadcasts or telecasts of games . . . may be made."¹⁹ The final judgment did allow restrictions on the telecasts of games in the home territory of a team that was playing at home that day.²⁰

The NFL, apparently satisfied with the 1953 decision, chose not to appeal it. Indeed, an official NFL publication described the 1953 decision as "laying the groundwork for pro football’s emergence as the game of the American mid-century." ²¹

At the time of the 1953 trial, each NFL team’s practice was to enter into an individual agreement with a sponsor, station or network involving radio and/or television rights. In 1960, however, the American Football League ("AFL") began operations and signed a five-year, league-wide television contract with ABC. In response, the NFL decided to enter into a two-year agreement with CBS that covered all NFL teams.²² The NFL asked the district court, which had retained jurisdiction over the final judgment, to approve the newly signed CBS agreement. The court chose instead to enjoin the NFL from performing the agreement, holding that the member clubs had "by agreement . . . eliminated competition among themselves in the sale of television rights," in violation of a provision in the final judgment that barred restrictions on the areas in which telecasts could be made.²³

Three months after the court’s order enjoining the NFL’s sale of games to CBS, Congress enacted, and President Kennedy signed, the SBA.²⁴

B. The Process That Led To The SBA’s Enactment

The SBA originated in the Antitrust Subcommittee of the House Judiciary Committee. Rep. Emanuel Cellar, the Chair of both the Judiciary Committee and the Antitrust Subcommittee, explained to the House that "[t]he purpose of this bill is to enable the member teams of a professional sports league to pool their separate rights in the sponsored telecasting of their games and to sell the resulting package of pooled rights to a television network or other purchaser without thereby violating the antitrust laws."²⁵ Rep. Cellar also noted that the AFL had operated under a pooled contract during the 1960 season and was free to continue to do so, leaving the NFL at a disadvantage.²⁶

Rep. Cellar further explained that under the district court’s recent ruling, "the members of a professional sports league cannot lawfully act in concert to assure member clubs with weak teams or limited home territory television markets an adequate amount of television income and of television coverage for games played away from home. Yet, should these weaker teams be allowed to founder, there is danger that the structure of the entire league would become impaired and its continued existence imperiled."²⁷ Rep. Cellar stated that as a consequence, the Judiciary Committee "believes that the great public interest in viewing professional league sports warrants some accommodation of antitrust principles . . . ."²⁸

The House passed the bill the day it was introduced, after a brief debate.²⁹ The Senate passed the bill without any meaningful debate three days later, on September 21, 1961.³⁰ President Kennedy signed the bill into law on September 30, 1961.³¹

III. THERE IS VERY LITTLE CASE LAW DISCUSSING THE MEANING OF "SPONSORED TELECASTING" OR ITS APPLICATION TO CABLE PROGRAMMING

A. The WGN Litigation (1991-1996)

It is undisputed that over-the-air network broadcasts of the four categories of professional sporting events set out in the SBA meet the definition of "sponsored telecasting" as used in the SBA. In contrast, the question of whether "sponsored telecasting" includes cable programming that is in part supported by advertising revenue remains unsettled.

The courts did not address the applicability of the SBA to league agreements with cable programmers until the early 1990’s, when the owner of the Chicago Bulls, joined by Chicago-area "superstation" WGN, sued the NBA after the league voted to reduce the number of games that the Bulls could authorize WGN to broadcast.³² That litigation, which lasted more than seven years, resulted in several opinions that addressed, in a limited fashion, the scope and application of the SBA.

Various commentators have stated that the district court in the WGN case held that agreements between a sports league and cable providers or programmers were not protected by the SBA.³³ A closer reading of the various decisions in the WGN litigation demonstrates, however, that while the district court was at times skeptical of the contention that the SBA protected agreements with cable providers or programmers, it did not render any such holding. In fact, the district court expressly stated that it had not resolved the issue, in an unpublished 1992 opinion that no court or commentator appears to have noticed.

In WGN I, the district court held that an NBA restriction on the number of games that a team could license to a "superstation" was an invalid restraint under the Sherman Act.³⁴ The court rejected the NBA’s argument that the restriction was exempt under the SBA, holding that the SBA did not apply because the broadcasting rights in question were being licensed by the Bulls and had not been transferred or sold on a league-wide basis, as 15 U.S.C. § 1291 requires.³⁵ The district court enjoined the NBA from enforcing the challenged restriction.³⁶

The court in WGN I addressed the applicability of the SBA to cable programming only in passing, when it noted that the SBA protected agreements involving "national broadcast rights . . . licensed to NBC (or possibly to TNT, assuming that TNT’s broadcasts fit within the statutory meaning of ‘sponsored telecasting’). . . ."³⁷

The Seventh Circuit affirmed the lower court’s injunction.³⁸ The court of appeals disagreed in part with the district court’s interpretation of the SBA, but it ultimately held that the SBA did not apply to the challenged restraints (for reasons not relevant to this article).³⁹

The Seventh Circuit’s decision did not end the litigation, because the Bulls and WGN had challenged other NBA restraints as well. On remand, the district court denied the NBA’s motion for summary judgment on the remaining claims.⁴⁰ It is the district court’s decision in WGN III that commentators cite as holding that league agreements with cable providers and programmers are not covered by the SBA.⁴¹ A careful review of the opinion, and of a subsequent opinion that clarified the district court’s intent, proves otherwise.

The NBA restrictions at issue in WGN III involved the "NBA Superstation Same Night Rule," pursuant to which individual teams were not permitted to license superstation broadcasts of NBA games on the same night that the league had licensed TNT to broadcast a game.⁴² The NBA moved for summary judgment in part on the ground that the "Same Night Rule" was exempt under the SBA by virtue of the rule’s inclusion in the NBA’s contract with TNT.⁴³ In the course of denying the NBA’s motion for summary judgment, the district court noted that "'[s]ponsored telecasting’ is not expressly defined by either the SBA or by any subsequent case law."⁴⁴ The court also stated that "it is not clear that TNT constitutes ‘sponsored telecasting’ within the SBA’s meaning." ⁴⁵ The court then quoted the House Report’s statement that "[t]he bill does not apply to closed circuit or subscription television," and it stated that the "plain meaning" in 1961 of "subscription television" "might arguably have referred only to a pay-per-view service."⁴⁶ On the other hand, the court deemed it "equally likely" that in 1961, "’sponsored telecasting’ would not have included such hybrid services as TNT and ESPN."⁴⁷

To recap:

1. the court in WGN III was addressing a summary judgment motion by the NBA based on its preferred interpretation of the SBA;
2. the court concluded that the proper statutory interpretation of the SBA was "not clear" and that the two differing interpretations proffered by the parties were "equally likely" to be correct; and
3. the court acknowledged the requirement that it should base its decision on the meaning of the relevant statutory language "at the time the legislation [was] passed," but cited no such evidence.

Nevertheless, despite the court’s uncertainty and the lack of relevant evidence, and despite the fact the court was addressing a defendant’s motion for summary judgment and was not deciding the outcome of a bench trial, the court stated that it had "conclude[d]" that TNT’s programming "falls outside the statutory meaning of ‘sponsored telecasting."⁴⁸

That certainly sounds like a holding, and various commentators have treated it as such. Fortunately, we do not have to guess about the district court’s true intentions because just one month later, the court made those intentions clear when it addressed the NBA’s request that the court certify its decision for immediate appeal under 28 U.S.C. § 1292(b).

The district court denied the NBA’s request on several grounds, but the "more important" ground was that:

"we have not yet ruled on the question of whether the Superstation Same Night Rule is exempt under the SBA. We have merely denied the NBA’s motion for summary judgment that it is."⁴⁹

This statement makes it obvious that the court’s purported holding in its November 1992 opinion that league agreements with TNT were not exempt under the SBA was poor drafting, not a holding, and has no precedential effect.⁵⁰

Three years later, the district court in the WGN case held a nine-week bench trial on plaintiffs’ remaining claims. As discussed below, the court’s post-trial opinion makes it even clearer that the court had not held in WGN III that league-wide agreements with cable programmers were not protected under the SBA.

In the three years between the district court’s initial rulings and the trial, the NBA had taken various steps in an effort to satisfy the SBA requirement (at issue in WGN I and WGN II) that to be exempt from antitrust scrutiny, an agreement must involve a transfer or partial transfer of "the rights of [the] league’s member clubs," rather than a transfer of an individual team’s rights.⁵¹ Under the NBA’s revised approach, NBC had the right to televise all 1107 regular season NBA games, but the NBA retained the ability to license up to 85 games "to national cable networks (including superstations)."⁵² The district court found that "on its face, [this] transfer falls within the language of section 1291" of the SBA.⁵³

The district court then addressed, but did not decide, the proper interpretation of "sponsored telecasting" as used in the SBA. As noted above, the NBA’s agreement with NBC allowed the NBA to license 85 games to cable networks.⁵⁴ The agreement separately allowed the NBA to "enter into agreements for subscription and pay-per-view transmissions of games . . . ."⁵⁵ When describing this provision, the district court added a footnote that demonstrates that the court had not held in WGN III that league agreements with TNT, a cable programmer, fell outside the SBA. The footnote begins with a statement that an NBA agreement for "subscription and pay-per-view transmission of games" is "not covered by the [SBA] because the SBA only applies to agreements regarding ‘sponsored telecasting.’"⁵⁶ The court then contrasted such programs with TNT’s cable programming:

"While telecasting on TNT may be considered sponsored telecasting because TNT does receive some revenues from advertising in addition to subscription fees, see [WGN III], pure subscription or pay-per-view telecasts clearly are not considered sponsored telecasting."⁵⁷

In other words, the district judge cited his prior opinion in WGN III not for the proposition that league agreements with TNT fell outside the SBA, but for the proposition that telecasting on TNT "may be considered sponsored telecasting because TNT does receive some revenues from advertising. . . ."⁵⁸ It is self-evident that the district judge would not have cited to his decision in WGN III for the proposition that TNT broadcasts "may be considered sponsored telecasting" if, in that opinion, he had held that they were not "sponsored telecasting."

Ultimately, the court in WGN V did not have to reach the cable programming issue, because it held that the challenged agreement between the NBA and NBC fell outside the SBA under section 1292. That section removes any exemption from the antitrust laws if the agreement in question contains restrictions on the licensee’s right to televise the licensed games.⁵⁹ Because the NBA’s agreement with NBC contained provisions that meant that "under the plain terms of the contract, no more than 111 games can be televised nationally," section 1292 was held applicable.⁶⁰

The district court went on to hold that for reasons not relevant here, the NBA-NBC agreement violated the antitrust laws. On appeal, the Seventh Circuit upheld the district court’s determination that the NBA’s agreement with NBC fell outside the SBA under section 1292, but the court reversed the district court’s ruling that the agreement violated the antitrust laws and remanded for a new trial.⁶¹ The Seventh Circuit’s opinion did not discuss the applicability of the SBA to cable programming. The trial court docket shows that the matter subsequently settled in late 1996, without any ruling on whether TNT’s cable programming was, or was not, "sponsored telecasting."⁶²

B. The Shaw Litigation (1997-2002)

The plaintiffs in Shaw v. Dallas Cowboys Football Club Ltd. were football fans who alleged that an agreement between the NFL and satellite TV provider DirecTV that allowed DirecTV to market a "Sunday Ticket" games package violated the antitrust laws.⁶³ The defendants moved to dismiss the complaint on the principal ground that the SBA exempted the alleged conduct from the antitrust laws. The district court disagreed and held that DirecTV’s "Sunday Ticket" package did not result from a league transfer of "all or any part of the rights of . . . member clubs in the sponsored telecasting" of football games.⁶⁴

The court began its analysis by defining the word "sponsor," as used in the phrase "sponsored telecasting," as "[o]ne that finances a project or event carried out by another person or group, especially a business enterprise that pays for radio or television programming in return for advertising time."⁶⁵ The court held that "[o]nly telecasting which is performed with such a sponsor can meet the meaning of the phrase ‘rights . . . in the sponsored telecasting.’"⁶⁶ After reviewing the legislative history of the SBA and the district court’s decision in WGN III, the court held that "satellite broadcasting" of NFL games by DirecTV, which charged subscribers $139 per season to view a package of commercial-free games, did not involve "sponsored telecasting."⁶⁷

The district court certified its decision in Shaw I for interlocutory review, and the Third Circuit affirmed.⁶⁸ The Court of Appeals began by stating that the "purpose [of the SBA] was to preserve the availability of NFL games on free broadcast television."⁶⁹ The court’s principal authority for that proposition was a statement in the 1961 Senate Report that had expressed the committee’s concern for "the public interest in viewing professional league sports."⁷⁰ The cited report did not, however, refer to "free" television and did not suggest that the SBA’s scope was limited to over-the-air network programming.⁷¹

The Third Circuit then stated its agreement with the district court’s definition of "sponsored telecasting,"⁷² although the Court ofAppeals, sub silentio, added a significant gloss to that definition. The district court, as noted above, had defined "sponsored telecasting" as telecasting that is sponsored by someone other than the telecaster, "especially" a "business enterprise that pays for radio or television programming in return for advertising time." The Court of Appeals repeated this language, but added that the telecasts in question "are therefore provided free to the general public."⁷³

Some commentators have cited the Third Circuit’s opinion as holding that league agreements with cable programmers are not exempt from the antitrust laws under the SBA because they supposedly do not involve "free" telecasting.⁷⁴ The better view, and the view that the district court on remand adopted, is that any statements by the Third Circuit in Shaw II that went beyond DirecTV’s satellite transmissions were merely dicta.⁷⁵

It is important in this regard to remember that the defendants in Shaw had not contended that the satellite programming they delivered to consumers (which did not have advertisements) was, itself, "sponsored telecasting," but had instead argued that the SBA applied to the DirecTV package because the NFL games in the package had previously been broadcast with commercial interruptions.⁷⁶ The district court and the Third Circuit therefore had no reason to address, and made no precedential holdings regarding, the applicability of the SBA to live sports programming on basic cable channels, where sponsors and their advertisements are ubiquitous.

The district court in Shaw acknowledged these limitations on remand. In the process of approving the parties’ eventual settlement of the class action, the court addressed the question of whether previous opinions in the case had involved the application of the SBA to cable programming. The court reached this issue because the parties had included in the settlement agreement a class-wide release of all claims regarding the transmission of NFL games "whether by broadcast, television, cable television, satellite television, the Internet or any form of technology . . . ."⁷⁷ The court held that the proposed release was overbroad. The court reasoned that:

(1) plaintiffs’ complaint "does not suggest that they have asserted any claims with respect to NFL programming by broadcast, cable television, or the Internet," and (2) "although defendants appealed the district court’s denial of their motion to dismiss, the Third Circuit’s ruling did not address whether broadcasting the games on the Internet or cable television was an exempt activity under the SBA, but only found that satellite broadcasts of NFL games were not exempted."⁷⁸ In other words, those commentators who have described the Third Circuit’s opinion in Shaw II as holding anything about cable programming are simply wrong, as the district court responsible for implementing the Court of Appeals’ mandate had squarely held.

C. The Kingray Litigation (2000-2002)

The only other case that has been cited as rendering a ruling on whether the SBA applies to cable programming is Kingray, Inc. v. National Basketball Association, Inc.⁷⁹ The plaintiffs in that case asserted antitrust claims against DirecTV and the NBA in connection with the NBA’s agreement that DirecTV could offer a "bundled package of NBA games to purchasers of the "NBA League Pass." The plaintiffs had alleged in their First Amended Complaint that the DirecTV-NBA agreement did not fall under the SBA because "sponsored telecasting" under the SBA "pertains only to network broadcast television and does not apply to non-exempt channels of distribution such as cable television, pay-per-view, and satellite television networks."⁸⁰

The district court in Kingray never reached the SBA issues that had been flagged in the Complaint. Instead, the court dismissed the First Amended Complaint, without leave to amend, on the ground that the plaintiffs were indirect purchasers who did not have standing to pursue their federal antitrust claims.⁸¹ Nevertheless, one district judge has relied on the above-quoted passage from Kingray to support its statement (in dicta) that the SBA was "inapplicable" to telecasts by Comcast of NHL and MLB games.⁸² It appears that the court in Laumann did not realize that the court in Kingray had merely been reciting plaintiffs’ allegations.⁸³

With the possible exception of the Laumann court’s misunderstanding of the Kingray opinion, the author has not located any judicial decision since 2002 that addressed the applicability of the SBA to cable programming. That leads us, finally, to an effort to apply principles of statutory interpretation to the phrase "sponsored telecasting" as used in the SBA.

IV. A TRADITIONAL APPROACH TO STATUTORY INTERPRETATION LEADS TO THE CONCLUSION THAT CABLE PROGRAMMING IS "SPONSORED TELECASTING" UNDER THE SBA

If the issue addressed in this article is, in fact, unsettled and unfettered by precedent, we then face the question: is today’s basic cable programming of professional sports "sponsored telecasting" under the SBA? To reach the answer, we review the current approach to statutory interpretation and then apply that approach to the relevant language in the SBA.

A. If the Statutory Text Is Unambiguous, Judicial Inquiry Ceases

It is now settled that if the text of a statute is unambiguous, the judiciary’s role is to apply the statutory provision without further analysis or debate. ⁸⁴

These principles apply even if, as here, the statute in question provides exemptions to the antitrust laws and thus should be narrowly construed. As the district court observed in Northland Cranberries, Inc. v. Ocean Spray Cranberries, Inc. , the courts "have repeatedly rejected proposed narrow interpretations of statutory exemptions from the antitrust laws where those interpretations are inconsistent with the plain language of the statute."⁸⁵ In Northland Cranberries, the court rejected an argument that a statutory reference to "persons engaged in the production of agricultural products" should be construed to refer only to "American persons" engaged in such activities.⁸⁶ The court held that the term "persons" was "plain and unambiguous" and that the text of the statute neither "stated or implied" any limitation on the ordinary meaning of the word.⁸⁷

To determine the plain meaning of words used in a statute, courts routinely begin by consulting dictionaries published at around the time that the statute was enacted.⁸⁸ Where the language used in a statute involves technical terms or terms reflecting business practices, the courts can turn to specialized dictionaries.⁸⁹

No court has yet undertaken this inquiry, and none of the opinions described in this article discussed any contemporaneous dictionary definitions of "sponsored," "telecasting" or "sponsored telecasting." We undertake that inquiry below.

B. The Meaning of "Sponsored Telecasting," As Used In 1961, Is Clear

If a professional football, baseball, basketball or hockey league transfers its clubs’ rights in the "sponsored telecasting of [the club’s] games," the parties’ agreement is exempt from the antitrust laws under the SBA.⁹⁰ Pursuant to the principles of statutory interpretation described above, we begin by reviewing dictionaries, including technical dictionaries, to determine the contemporaneous meaning of the phrase "sponsored telecasting." Fortunately, we do not have to look far, for in 1961, the same year in which the SBA was enacted, Prof. Howard Jacobson published "A Mass Communications Dictionary." Jacobson described his dictionary as "a reference work of common terminologies for press, print, broadcast, film, advertising and communications research."⁹¹

Jacobson’s dictionary included definitions for "telecast" and "sponsor," as set out below:

"Sponsor—Advertisers who use TV and/or radio to inform and sell their individual products and services to the public."
"Telecast—A broadcast, program or show on television";⁹²

In light of these definitions, it is apparent that "sponsored telecasting," when used in 1961 in the mass communications and advertising arena, referred to television broadcasts that included advertisements for individual products or services.⁹³ That description easily fits today’s sports programming on basic cable, where paid advertising is ubiquitous. As a result, the courts should hold, if the issue arises, that the SBA exempts from antitrust scrutiny those league agreements that involve basic cable programming.

Because the meaning of "sponsored telecasting" as used in 1961 is clear, a court should render its ruling without diving into legislative history. As the Supreme Court has repeatedly held, the "authoritative statement is the statutory text, not the legislative history or any other extrinsic material."⁹⁴ Moreover, even if a court were to find "sponsored telecasting" to be ambiguous, the legislative history of the SBA does not contain any basis for adopting a more restrictive definition, as discussed below.

C. Even If a Court Were to Consider "Sponsored Telecasting" to Be Ambiguous, an Analysis of the Statute’s Purpose And Legislative History Would Still Lead to the Conclusion that Today’s Basic Cable Programming Should Be Considered "Sponsored Telecasting"

1. Introduction

As noted in Section II(A) of this article, the SBA was enacted in large part in response to a district court’s ruling in 1961 that the NFL’s sale of a games package to CBS violated the antitrust laws. Congress acted quite quickly: the SBA was passed by both houses, and signed into law by President Kennedy, only sixty-three days after the district court’s ruling.⁹⁵

The House Report that accompanied the bill in question stated that its purpose "is to enable the member clubs of a professional football, baseball, basketball, or hockey league to pool their separate rights in the sponsored telecasting of their games and to permit the league to sell the resulting package of pooled rights to a purchaser, such as a television network, without violating the antitrust laws."⁹⁶ The chair of the House Judiciary Committee (and sponsor of the bill), Rep. Cellar, similarly informed the House that the antitrust exemption provided by the SBA allows the sale of pooled rights "to a television network or other purchaser."⁹⁷ The Senate Report also contains broad language.⁹⁸ This phrasing strongly suggests that Congress had in mind purchasers other than over-the-air television networks, and that such networks were identified as an example of "sponsored telecasting," not as the only possible beneficiary of the exemption provided by the SBA.

Congress did not, in 1961, provide any specific definition of "sponsored telecasting." The legislative history does, however, contain suggestions about what is not "sponsored telecasting." The bill’s sponsor, Rep. Cellar, stated that the SBA "applies only to sales of rights in sponsored telecasting; it does not apply to closed circuit or subscription television."⁹⁹ The House Report contains the same language.¹⁰⁰ As discussed below, those two types of programming—as they existed in 1961—were substantially different from today’s basic cable programming.

2. Today’s Basic Cable Programming Is Substantially Distinguishable From the "Closed Circuit" and "Subscription Television" Programming That Congress Pointed to as Not Covered by The SBA

a. "Subscription Television" In the 1950s and Early 1960s

According to industry historians, the 1950s and early 1960s saw the development and testing of "a form of television known variously as ‘pay-television,’ ‘subscription television,’ or ‘toll television.’"¹⁰¹ These terms "referred to forms of television supported by direct viewer payments, not advertising," and "were the precursors to today’s premium cable channels . . . ."¹⁰²

According to Mullen, the "pay television industry, which had experienced technical, regulatory and economic fits and starts throughout the 1950’s, made another series of appearances during the early 1960’s."¹⁰³ The FCC gave temporary approval to pay television in March 1959, and "three major system tests" then took place.¹⁰⁴ In 1960, International Telemeter launched a test system in a Toronto suburb of a wired pay-for-view service that customers accessed by feeding coins into a box that was wired to their television.¹⁰⁵ The service offered movies, sports, and other programming on a pay-per-program basis.¹⁰⁶ The test shut down in 1965.¹⁰⁷

Zenith launched a similar test of its Phonevision service in Hartford, Connecticut in 1962. As with International Telemeter, the Phonevision service was activated by inserting coins into the customer’s decoder device, on a per-program basis.¹⁰⁸ The 1962 test in Hartford involved a UHF station that broadcast commercial off-the-air programs during the day but switched to encrypted Phonevision pay-per-view programming in the evening.¹⁰⁹ Subscription figures "never attained levels sufficient to justify costs, however," and Zenith eventually abandoned the test.¹¹⁰ The third test launch was Subscription Television, Inc. ("STV"), which had been developed in the 1950s by Skiatron Television and Electronics Corporation. Mullen at 52. STV, which had a programming mix similar to the two systems described above, was operational in San Francisco and Los Angeles for four months in 1964.¹¹¹ Although STV’s schedule included exclusive game coverage of the San Francisco Giants and the recently relocated Los Angeles Dodgers, the test was deemed unsuccessful.¹¹²

b. "Closed Circuit Television" in the 1950s and Early 1960s

According to the Museum of Broadcast Communications, "Closed Circuit Television" is a "transmission system in which live or prerecorded signals are sent over a closed loop to a finite and predetermined group of receivers. . . ."¹¹³ In the 1950s and 1960s, boxing promoters used Closed Circuit Television to show boxing matches in movie theaters, which became a "lucrative source of ancillary revenue" for those promoters.¹¹⁴ Efforts to put NFL games on closed circuit television continued as late as 1977, when the founder of Subscription Television, Inc., Bill Sargent, formed a closed-circuit provider called Special Event Entertainment and offered the NFL $400 million to show playoff games, including the Super Bowl, through a national closed-circuit network.¹¹⁵ According to the Times, Sargent’s bid "topped the money offered by the commercial television networks but would have forced fans to pay for a seat at a movie theater to watch the games. . . . It did not happen."¹¹⁶

It is clear from the above descriptions that the "Closed Circuit" and "Subscription Television" offerings that Congress was concerned about in 1961 are readily distinguishable from today’s basic cable programming. The former offerings involved the transmission of a single, commercial-free program to a consumer in exchange for payment for that program and represented, according to an industry historian, "the precursors to today’s premium cable channels," such as HBO and Showtime.¹¹⁷ Today’s basic cable, on the other hand, involves the transmission to consumers of hundreds of channels of programming (many of which are available 24/7) that cover a full spectrum of interests and that contain a substantial amount of commercial advertising, all for a single monthly fee. In other words, the statement in the House Report that the SBA "does not apply to closed circuit or subscription television" provides no basis for a conclusion that "sponsored telecasting," as used in the SBA, does not include today’s basic cable programming.¹¹⁸

3. The Stated Purposes of the SBA Would Be Best Fulfilled by Applying It to Cable Programming

If the phrase "sponsored telecasting" were ambiguous, and if the Court were to consider Congress’ overall statutory purpose in deciding how to define that phrase, the outcome remains clear. Congress’ purpose in enacting the SBA was two-fold: (1) to protect the "public interest in viewing professional league sports"¹¹⁹; and (2) to "permit professional sports leagues to deal jointly in the sale of their TV rights and, by grouping their weaker and stronger clubs and those clubs with greater or lesser home territory population, to provide equal access to television facilities and television income for all member clubs of their league."¹²⁰ Because the percentage of U.S. households who access only over-the-air network broadcasts is around 17%, while basic cable programming is available to the substantial majority of U.S. households,¹²¹ it is obvious that the SBA’s purposes would not be served if the SBA applied only to over-the-air broadcasts and would instead be best served by including both over-the-air and basic cable programming within the definition of "sponsored telecasting."¹²²

V. CONCLUSION

It may be surprising that in the 55 years since the enactment of the Sports Broadcasting Act, no court has ever definitively ruled that agreements between professional sports leagues and basic cable programmers are, or are not, protected by the antitrust exemptions set out in the Act. But as set out in this article, the green is indeed open, and the fact is that the operative language that Congress chose to use to trigger the statutory exemptions ("sponsored telecasting"), when examined through the statutory interpretation lens that courts use today, quite clearly includes basic cable programming, whose "telecasts" of professional sporting events are "sponsored," as those terms were used in 1961.

——–

Notes:

^1. Mr. Perry is a partner at Munger, Tolles & Olson LLP, whose clients include media companies and sports leagues. The views expressed in this article are those of the author and do not necessarily represent the views of Munger, Tolles & Olson, its lawyers, or its clients.

^2. 15 U.S.C. § 1291.

^3. 808 F. Supp. 646 (N.D. Ill. 1992).

^4. Chicago Prof’l Sports Ltd. P’ship v. Nat’l Basketball Ass’n, No. 90 C 6247, 1992 WL 373027 at * 1 (N.D. Ill. Dec. 10, 1992).

^5. See Chicago Profl Sports Ltd. P’ship, 874 F. Supp. 844, 856 n.12 (N.D. Ill. 1995) ("[T]elecasting on TNT may be considered sponsored telecasting because TNT does receive some revenues from advertising in addition to subscription fees. . . .").

^6. 172 F.3d 299, 301-02, and 301 n.9 (3d Cir. 1999).

^7. Schwartz v. Dallas Cowboys Football Club Ltd., 157 F. Supp. 2d 561, 577 (E.D. Pa. 2001) (emphasis added).

^8. United States v. Nat’l Football League (U.S. v. NFL II), 196 F. Supp. 445, 447 (E.D. Pa. 1961).

^9. See NFL on DuMont, Wikipedia.com, https://Wikipedia.org/wiki/NFL_on_DuMont (last visited on September 12, 2016).

^10. United States v. Nat’l Football League (U.S. v. NFL I), 116 F. Supp. 319, 327-29 (E.D. Pa. 1953).

^11. Id. at 321.

^12. Id. at 326-27.

^13. Id.

^14. Id.

^15. Id. at 324-25. The court defined "outside games" as games "played outside the home territory of a club in which the club was not a participant." Id. at 321 n.2.

^16. Id. at 323.

^17. Id. at 325.

^18. Id. at 325-26.

^19. U.S. v. NFL II, 196 F. Supp. 445, 447 (E.D. Pa. 1961).

^20. Id. at 447 n.5. The text of the district court’s final judgment is not included in the Westlaw versions of the 1953 or 1961 opinions but can be found in the transcript of an August 1961 Congressional hearing. See Telecasting of Professional Sports Contests: Hearing Before the Antitrust Committee of the House Committee on the Judiciary on H.R. 8757, 87th Cong., 1st Sess., at 24-27 (Aug. 28, 1961) [hereinafter "8/8/61 H’rg Tr."].

^21. See The First Fifty Years—The Story of the National Football League 234 (1969).

^22. U.S. v. NFL II, 196 F. Supp. at 446.

^23. Id. at 447. The court reasoned that because the agreement gave CBS the right to determine where games would be shown, and because the individual teams had agreed not to sell their television rights separately, the agreement was at odds with the final judgment. Id. According to NFL Commissioner Pete Rozelle’s subsequent Congressional testimony, the district judge stated at the 1961 hearing that he could not remember why the provision in question had been included in the final judgment, given that a league-wide TV contract was not "at issue at that time." 8/8/61 H’rg Tr. at 6-7.

^24. 1961 Cong. Rec. 21552 (Sept. 30, 1961).

^25. 1961 Cong. Rec. 20059 (Sept. 18, 1961).

^26. Id.

^27. Id. at 20060.

^28. Id. See also id. at 20061 (statement of Rep. McCulloch that because the "authority to enter into a package television contract is necessary to protect the financial and business interests of the weaker teams of the league," the Judiciary Committee believed it to be "desirable to grant a very narrow exemption from the antitrust laws").

^29. Id. at 20064.

^30. Id. at 20662. Senator Hruska offered an explanation of the bill’s purpose just prior to the Senate vote: "[t]he purpose of this bill is to permit professional sports leagues to deal jointly in the sale of their TV rights and, by grouping their weaker and stronger clubs and those clubs with greater or lesser home territory population, to provide equal access to television facilities and television income for all member clubs of their league." Id. The Senate Report noted an additional concern for "the public interest in viewing professional league sports." S. Rep. No. 1087 (1961), as reprinted in 1961 U.S.C.C.A.N. at 3044 [hereinafter "1961 Senate Report"].

^31. Id. at 21552.

^32. See Chicago Prof’l Sports Ltd. P’ship, et al. v. Nat’l Basketball Ass’n (WGNI), 754 F. Supp. 1336, 1338-40 (N.D. Ill. 1991).

^33. See, e.g., Babette Boliek, Antitrust, Regulation, and the "New" Rules of Sports Telecasts, 65 Hastings L.J. 501, 533 and n.185 (2014) (stating that the district court in the WGN case had found that cable television was not sponsored telecasting under the SBA); Ross C. Paolino, Upon Further Review: How NFL Networks Is Violating the Sherman Act, 16 Sports Law. J. 1, 11 (2009) (same).

^34. WGN I, 754 F. Supp. at 1364. The court accepted the NBA’s definition of a "superstation" as a commercial over-the-air station whose signal is received by more than 5% of U.S. cable subscribers. Id. at 1345. WGN fit that description at the time, no doubt aided by the fact that its Bulls broadcasts featured Michael Jordan in his prime. The NBA’s restrictions on the superstation licensing rights of individual teams were intended to protect the TV audience for the NBA games that the league had licensed to NBC and to cable programmer TNT. Id. at 1345-47.

^35. Id. at 1350.

^36. Id. at 1364.

^37. Id. at 1351.

^38. See Chicago Prof’l Sports Ltd. P’ship v. Nat’l Basketball Ass’n (WGN II), 961 F.2d 667 (7th Cir. 1992).

^39. Id. at 671.

^40. See Chicago Prof’l Sports Ltd. P’ship v. Nat’l Basketball Ass’n (WGN III), 808 F. Supp. 646, 651 (N.D. Ill. 1992).

^41. See, e.g., Boliek, supra note 33, at 533 n.185; Paolino, supra note 33, at 10 n.70.

^42. WGN III, 808 F. Supp. at 647.

^43. Id.

^44. Id. at 650.

^45. Id. at 649 (emphasis added). It is notable that while the court acknowledged that statutes "must be construed according to the plain meaning of their terms at the time the legislation is passed," the court’s opinion referenced no contemporaneous uses of "sponsored," "telecasting," or "sponsored telecasting." Id. at 650.

^46. Id. at 650.

^47. Id.

^48. Id. at 650.

^49. Chicago Prof’l Sports Ltd. P’ship v. Nat’l Basketball Ass’n (WGN IV), No. 90 C 6247, 1992 WL 373027, at *2 (N.D. Ill. Dec. 10, 1992) (emphasis added).

^50. The court’s December 1992 opinion appears to have been entirely overlooked by courts and commentators. Westlaw does not identify any court decision or article that cites the district court’s clarification in WGN IV of its intent in WGN III.

^51. Chicago Prof’l Sports Ltd. P’ship v. Nat’l Basketball Ass’n (WGN V), 874 F. Supp. 844, 852-54 (N.D. Ill. 1995).

^52. Id. at 853.

^53. Id. at 855.

^54. Id. at 856.

^55. Id.

^56. Id. at 856 n.12.

^57. Id.

^58. Id.

^59. Id. at 856.

^60. Id.

^61. Chicago Proft Sports Ltd. P’ship v. Nat’l Basketball Ass’n (WON VI), 95 F.3d 593, 596-600 (7th Cir. 1996).

^62. See Chicago Profl Sports Ltd. P’ship v. Nat’l Basketball Ass’n, No.1:90-cv-06247 (N.D. Ill. Dec. 19, 1996), ECF No. 691-92 (Stipulation and Agreed Order of Dismissal; Minute Order Dismissing With Prejudice).

^63. See Shaw, et al. v. Dallas Cowboys Football Club Ltd. (Shaw I), No. CIV.A. 97-5184, 1998 WL 419765, at *1-2 (E.D. Pa. June 23, 1998).

^64. Id. at *4-5.

^65. Id. at *3 (quoting The American Heritage Dictionary of the English Language 17411 (3rd Ed. 1992)).

^66. Id.

^67. Id. at *4. The court noted in dicta (and incorrectly) that the district court in WGN III had "held that TNT was more like subscription television than like sponsored telecasting, and so a contract with TNT was not exempt . . . ." Id. (citing WGNIII, 808 F. Supp. at 649-50). A review of the briefing in connection with Shaw I (available in the docket folder on Westlaw) reveals that none of the parties had alerted the Shaw court to the December 1992 opinion in WGN IV in which the district court clarified that no such holding had been intended or made.

^68. Shaw v. Dallas Cowboys Football Club, Ltd. (Shaw II), 172 F.3d 299, 302-03 (3d Cir. 1999).

^69. Id. at 301 and n.7.

^70. Id. at 301 n.7.

^71. See 1961 Senate Report, 1961 U.S.C.C.A.N. at 3042, 3044.

^72. Shaw I, 1998 WL 419765 at *3.

^73. Shaw II, 172 F.3d at 301. See also id. at 301 n.9 (referring to a "sponsored telecast" as one "transmit[ted] in a form freely receivable by the public").

^74. See, e.g., Paolino, supra note 33, at 11.

^75. See In re Friedman’s Inc., 738 F.3d 547, 552 (3d Cir. 2013) ("If a determination by our Court is not necessary to our ultimate holding, ‘it properly is classified as dictum! It is well established that ‘we are not bound by our Court’s prior dicta."’) (citation omitted).

^76. Shaw I, 1998 WL 419765 at *2.

^77. Schwartz v. Dallas Cowboys Football Club, Ltd., 157 F. Supp. 2d 561, 575-78 (E.D. Pa. 2001).

^78. Id. at 577 (emphasis added).

^79. 188 F. Supp. 2d 1177, 1182 (S.D. Cal. 2002).

^80. Id. at 1183 (quoting ¶43 of the First Amended Complaint). See First Amended Complaint, Danray, Inc. v. Nat’l Basketball Ass’n, Inc., Case No. 00CV1545 (S.D. Cal. July 16, 2001), ECF No. 145, ¶43.

^81. Kingray, 188 F. Supp. 2d at 1182.

^82. See Laumann v. Nat’l Hockey League, 907 F. Supp. 2d 465, 489, and 489 n.141 (S.D.N.Y. 2012) (denying motion to dismiss antitrust claims).

^83. The SBA issues were not even before the court in Laumann because the defendants in that case had not, in their motion to dismiss, asserted an SBA defense. See Plaintiffs’ Memorandum of Law in Opposition to Defendants’ Motions to Dismiss the Complaints, Case No. 12-cv-1817 (S.D.N.Y. Sept. 5, 2012), ECF No. 80, at 30 n.39 ("Defendants in this case do not assert the SBA as a defense to Plaintiffs’ allegations.").

^84. See City of Arlington, Texas v. F.C.C, 133 S. Ct. 1863, 1868 (2013) ("If the intent of Congress is clear, that is the end of the matter; for the court . . . must give effect to the unambiguously expressed intent of Congress"). See also Kloeckner v. Solis, 133 S. Ct. 596, 607 n.4 (2012) ("[E]ven the most formidable argument concerning the statute’s purposes could not overcome the clarity [of] the statute’s text."); Exxon Mobil Corp. v. Allapattah Servs., Inc., 545 U.S. 546, 568 (2005) ("As we have repeatedly held, the authoritative statement is the statutory text, not the legislative history or any other extrinsic material"); Microsoft Corp. v. Comm’r of Internal Revenue, 311 F.3d 1178, 1186 (9th Cir. 2002) ("When the plain language of a statute is clear, we need look no further to divine its meaning.").

^85. 382 F. Supp. 2d 221, 226 (D. Mass. 2004).

^86. Id. at 224-25.

^87. Id. See also United States v. Tucor Int’l, Inc., 189 F.3d 834, 837 (9th Cir. 1999) (rejecting an argument that an antitrust exemption covering "common carriers" should be limited to "ocean common carriers"); Int’l Raw Materials, Ltd. v. Stauffer Chem. Co. , 978 F.2d 1318, 1319 (3d Cir. 1992) (rejecting an argument that an antitrust exemption for "associations" should be construed as referring only to associations of American-owned firms).

^88. See, e.g., Cook Cnty., Illinois v. United States ex rel. Chandler, 538 U.S. 119, 125-26 (2003) (consulting law dictionaries published in 1856 and 1859 to interpret a statute adopted in 1863); Microsoft Corp. , 311 F.3d at 1183 (relying on "[d]ictionary definitions contemporary to the original enactment" of the statute in question).

^89. See Jason Weinstein, Against Dictionaries: Using Analogical Reasoning to Achieve a More Restrained Textualism, 38 U. Mich. J.L. Reform 649, 654 (2005) (noting that between 1994 and 2002, the Supreme Court "[u]sually . . . use[d] a specialized dictionary to define technical terms").

^90. 15 U.S.C. § 1291.

^91. Jacobson, A Mass Communications Dictionary (1961) (title page). See also id. at viii (noting that the dictionary’s editors had "gathered up the current working terminologies in most phases of mass communication").

^92. Id. at 320, 338.

^93. The 1992 general dictionary that the district court in Shaw I relied upon contained a similar definition of "sponsor": "one that finances a project or event carried out by another person or group, especially a business enterprise that pays for radio or television programming in return for advertising time." Shaw I, 1998 WL419765, at *3 (E.D. Pa. June 23, 1998) (quoting The American Heritage Dictionary of the English Language 17211 (3rd Ed. 1992)). The court in U.S. v. NFL I similarly defined "’live’ telecasts" as "telecasts made simultaneously with the playing of the game as contrasted with movies of the game telecast subsequent to the playing of the game." U.S. v. NFL I, 116 F. Supp. 319, 321 n.4 (E.D. Pa. 1953). This definition provides additional evidence that the word "telecasting" in the 1950s applied to any program viewed on a television.

^94. Exxon Mobil Corp. v. Allapattah Servs. Inc., 545 U.S. 546, 568 (2005). See also Microsoft Corp., 311 F.3d at 1186 ("When the plain language of a statute is clear, we need look no further to divine its meaning.").

^95. 1961 Cong. Rec. 21552 (Sept. 30, 1961).

^96. See H.R. Rep. No. 1178 at 2 (Sept. 13, 1961).

^97. 107 Cong. Rec. 20059 (Sept. 18, 1961) (emphasis added).

^98. See S. Rep. No. 1087, 87th Cong., 1st Sess., reprinted in 1961 U.S.C.C.A.N. at 3042, 3044 (stating that the public interest would be served "by exempting joint agreements under which a league sells or transfers pooled television rights of its members to a purchaser") [hereinafter S. Rep. No. 1087].

^99. 107 Cong. Rec. 20060 (Sept. 18, 1961).

^100. See H.R. Report No. 1178 at 5 (Sept. 13, 1961) ("The bill does not apply to closed circuit or subscription television.").

^101. Megan Mullen, Television in the Multichannel Age 52 (2008).

^102. Id. (emphasis added) (referencing HBO, Showtime and other pay channels).

^103. Id. at 75.

^104. Id.

^105. Id. at 75-76.

^106. Id.

^107. Id.

^108. Id.

^109. Id.

^110. Patrick R. Parsons, Blue Skies: A History of Cable Television at 112 (2008).

^111. Id. at 76-77.

^112. Id.

^113. Encyclopedia of Television, "Closed Circuit Television," found at http://www.museum.tv/encyclopedia. htm (last visited Sept. 18, 2016).

^114. Id.

^115. Wolfgang Saxon, Bill Sargent, 76, A Pioneer in Closed-Circuit and Pay TV, N.Y. Times, Oct. 31, 2003, http://www.nytimes.com/2003/10/31/arts/bill-sargent-76-a-pioneer-in-closed-circuit-and-pay-tv. html?_r=0.

^116. Id.

^117. Mullen, Television in the Multichannel Age 52 (2008).

^118. Some commentators who argue that the SBA applies only to over-the-air broadcasts of professional sporting events point to an exchange during the 1961 Congressional hearing between House Judiciary Committee Counsel Herbert Malete and NFL Commissioner Pete Rozelle. Malete asked Rozelle if he understood "that this bill covers only the free telecasting of professional sports contests, and does not cover pay TV?" Mr. Rozelle answered "Absolutely." 8/8/61 H’rg Tr. at 36. It is not clear from this exchange if Mr. Rozelle was focused on the word "free" in counsel’s question or was thinking of the types of "pay television" that were prevalent at the time. In any event, under modern principles of statutory interpretation, this exchange between committee counsel and a witness cannot be relied upon to alter the language that Congress chose to use in the SBA ("sponsored telecasting") by inserting different language ("free telecasting"). See generally Laborers’ Local 265 Pension Fund v. iShares Trust, 769 F.3d 399, 405 (6th Cir. 2014) (observing that oral testimony by individual witnesses at committee hearings "is typically accorded little weight"); Public Citizen v. Farm Credit Admin., 938 F.2d 290, 292 (D.C. Cir. 1991) (per curiam) (noting that the "testimony of witnesses before congressional committees prior to passage of legislation is generally weak evidence of legislative intent").

^119. S. Rep. No. 1087, 1961 U.S.C.C.A.N. at 3044.

^120. Id. (statement by Sen. Hruska).

^121. See Deborah D. McAdams, "Survey: 17 Percent of U.S. Households Are OTA-Only," available at www.TVTechnology.com/news/0002/17-percent-of-us-households-are-otaonly/278987 (last visited Sept. 18, 2016).

^122. See generally King v. Burwell, 135 S. Ct. 2480, 2489 (2015) (holding that where the text of a statute appears to be ambiguous, the courts should look to "the remainder of the statutory scheme" because it "often" reveals that "only one of the permissible meanings produces a substantive effect that is compatible with the rest of the law") (quoting United Sav. Assn. of Tex. v. Timbers of Inwood Forest Associates, Ltd., 484 U.S. 365, 371 (1988)).