The opinion of the court was delivered by: HARVEY BARTLE, III, District Judge
This action involves a dispute between Robert and William Healy, who
are the owners of two apartment complexes in Falls Township, Bucks
County, Pennsylvania, and Comcast of Southeast Pennsylvania, Inc.
("Comcast").*fn1 The owners claim the right to terminate the cable
television services provided by Comcast to their tenants and to remove
the so-called home run wiring over which Comcast transmits its service
into the apartments. The owners in their complaint and Comcast in its
counterclaim seek a declaration of their rights under the Federal
Communications Act, 47 U.S.C. § 541, et seq., and a related
regulation, 47 C.F.R. § 76.804(a)(1), as well as under the
Pennsylvania Landlord and Tenant Act, 68 Pa. Stat. Ann. §§ 250.504-B,
et seq. Comcast also requests injunctive relief. This action
was tried without a jury. Our findings of fact and conclusions of law
It is undisputed that at all relevant times, the plaintiffs have owned
two apartment complexes in Falls Township known as the Commons at
Fallsington and Falls Creek Village. Comcast has supplied cable
television service to the apartments for a number of years over what is
known as home run wiring owned by Comcast. Home run wiring is defined as
"[t]he wiring from the demarcation point to the point at which the [cable
operator's] wiring becomes devoted to an individual subscriber or
individual loop." 47 C.F.R. § 76.800. The plaintiffs have also
installed parallel home run wiring at their two properties for use by
Viking Communications, Inc. ("Viking"), a competing cable television
service that they own. The present dispute had its genesis when Viking
which manages properties owned by the Healys, sent
Comcast two similar letters on May 13, 2003, terminating Comcast's
services at the Commons at Fallsington and at Falls Creek Village. The
letter concerning the Commons at Fallsington read:
As you know Comcast does not have a contract to
serve the above referenced property, accordingly
your services to the Commons at Fallsington are
hereby terminated effective August 10, 2003. As a
result your access to the premises will also
terminate on that date.
Should you wish to terminate sooner, please let me
On June 13, 2003, Edward Pardini, Regional Vice President of Comcast,
met with Edward Nepa, Chief Operations Officer of Viking, to discuss the
May 13 letters and other suits that were pending between Comcast and
Viking. They made an oral agreement "not to raise new legal issues or
challenges within [pending] cases, and not to file any new legal actions"
for the time being in an attempt to mollify the escalating conflict
between the two companies. On July 25, 2003, the parties entered into a
Standstill Agreement which stayed all pending matters between Comcast and
Viking until October 8, 2003. Included in the Standstill Agreement were
the pending matters that were the subject of the May 13 termination
letters. On November 3, 2003, Comcast sent plaintiffs a "Notice of
Intention to Provide Cable Television Service Pursuant to the Tenants'
Rights to Cable Television Act" for each of the properties and attached
requests of tenants for continued Comcast cable service.
Plaintiffs contend that Comcast, after receiving the May 13, 2003
letters, failed to take certain steps within the time periods enumerated
in the Federal Communications Commission ("FCC") Regulation at
47 C.F.R. § 76.804(a)(1). According to plaintiffs, Comcast has now abandoned
its home run wiring and has no right to continue to provide service to
the tenants at the Commons at Fallsington and Falls Creek Village.
that it has not met the time requirements set forth in the above
regulation but argues that it does not apply.
For present purposes, the key language of §§ 76.804(a)(1) is found
in its first sentence, which reads:
Where an MVPD*fn4 [cable television operator]
owns the home run wiring in an MDU*fn5 and does
not (or will not at the conclusion of the notice
period) have a legally enforceable right to
remain on the premises against the wishes of the
MDU owner, the MDU owner may give the MVPD a
minimum of 90 days' written notice that its access
to the entire building will be terminated to
invoke the procedures in this section.
47 C.F.R. § 76.804(a)(1) (emphasis added). The FCC promulgated
this regulation pursuant to its authority under the Federal
Communications Act, 47 U.S.C. § 544. In a 1997 report, the FCC
the procedural mechanisms we are adopting will
apply only where the incumbent provider no longer
has an enforceable legal right to maintain its
home run wiring on the premises against the will
of the MDU owner. These procedures will not
apply where the incumbent provider has a
contractual, statutory or common law right to
maintain its home run wiring on the property.
We also reiterate that we are not preempting any
rights the incumbent provider may have under state
law. In the building-by-building context, the
procedures will not apply where the incumbent
provider has a legally enforceable right to
maintain its home run wiring on the
premises, even against the MDU owner's
wishes, and to prevent any third party from
using the wiring.
FCC Report and Order and Second Further Notice of Proposed
Rulemaking In the Matter of Telecommunications Services Inside
Wiring, CS Docket No. 95-184, MM Docket No. 92-260, 13 FCC Red.
3659, *3693 ¶ 69, 1997 WL 644031 (Oct. 17, 1997) (emphasis added).
It is Comcast's position that it has a "legally enforceable right to
remain on the premises against the wishes of the MDU owner." Comcast
relies on two 1997 agreements between plaintiffs and Suburban Cable TV
Co., Inc. ("Suburban"), one of which is in the form of a stipulation and
court order,*fn6 as well as on a 2002 franchise agreement between it and
Falls Township authorizing it to provide cable service within the
Township's boundaries. In addition, Comcast contends it has a legally
enforceable right under the Tenants' Rights to Cable Television Act,
68 Pa. Stat. Ann. §§ 250.501-B, et seq., which is part of the
Pennsylvania Landlord and Tenant Act. If Comcast is correct, the
federal regulation and its time deadlines on which plaintiffs rely
are not applicable. Not surprisingly, plaintiffs maintain that the
evidence presented at this trial and the law preclude such a result.
We first turn to the question of whether the 1997 agreement between
plaintiffs and Suburban and the 1997 agreement incorporated in a court
order operate to the benefit of Comcast. We find that they do. Suburban
was a wholly-owned subsidiary of Lenfest Communications, Inc. until the
latter merged with Comcast Corporation in November, 1999. As a result of
the merger, Suburban became a subsidiary of Comcast Corporation. In
September, 2000, Suburban changed its name, first to Comcast Cablevision
of Southeast Pennsylvania, Inc., and then in August, 2003, to Comcast of
Southeast Pennsylvania, Inc. Thus, Comcast of Southeast Pennsylvania,
Inc., the defendant here, is simply Suburban with a new name.
The 1997 agreements between Suburban and the plaintiffs make it
abundantly clear not only that Suburban owns the wiring which Suburban or
Suburban's predecessor, Oxford Valley Cablevision Inc. put in place at
Falls Creek Village and the Commons at Fallsington but also that Suburban
has the right to use it. The 1997 agreement in the form of a stipulation
and order by the state court recognized that Suburban was "the rightful
owner" of the wire which Suburban or its predecessor had installed at the
Commons at Fallsington and which it "uses or has used to provide cable
television service to the tenants."
Suburban Cable TV Co. v. Robert T. Healy, et al., Court
of Common Pleas, Bucks County, No. 97001596-17-15, Stipulation and Order
and Agreement of Settlement and Release, *4 ¶ 11 (Apr. 28, 1997). It
also "permanently enjoined [the Healys] from removing, cutting, using or
otherwise tampering with the wire, cable, and equipment . . . Suburban
Cable uses or has used to provide cable television service to the
occupants of the rental units in the Commons at Fallsington."
Id. at *4 ¶ 12. The 1997 agreement pertaining to Falls
Creek Village contained analogous provisions. The May 13, 2003 letters
seeking to terminate Comcast's access to the premises can only be read as
attempting to contravene the 1997 agreements. Indeed, the letter related
to the Commons at Fallsington is nothing less than a violation of the
injunction entered by the Court of Common Pleas of Bucks County.
Plaintiffs next contend that even if Comcast has a valid right to
ownership and use of the wiring by virtue of the 1997 agreements, Comcast
nonetheless has no legally enforceable right to remain on the properties
because Comcast does not have a valid franchise from Falls Township to
provide cable television service. With limited exceptions that have not
been asserted here, a cable operator cannot provide cable service in a
municipality without a franchise. See 47 U.S.C. § 541(b).
Suburban's franchise agreement with Falls Township expired on February
10, 2000 and Comcast's current franchise agreement with Falls Township
was not signed and effective until January 22, 2002. Plaintiffs argue
that this interval rendered the
agreements between Suburban and the plaintiffs ineffective. During
this time frame, however, Comcast continued to pay franchise fees to the
Township and provide cable television service to tenants at the Commons
at Fallsington and Falls Creek Village while the parties negotiated the
renewal of the franchise. The Township did nothing inconsistent with the
continued existence of a franchise. Moreover, the plaintiffs did nothing
inconsistent with the continued validity of the franchise or the 1997
agreements. Although the record is devoid of any written extension of the
franchise agreement from February 10, 2000 until January 22, 2002, the
conduct of Comcast, Falls Township, and the plaintiffs during
this period establish that all three parties maintained their
relationships as if nothing had changed. "When [the] parties continued to
act under the contract, their tacit agreement to be bound by it is as
strong as any express renewal could make it." Good Intent Co. v.
Hartzell, 22 Pa. 277, 1853 WL 6452, *10 (Pa. 1853). See also
EFCO Importers v. Halsobrunn, 500 F. Supp. 152, 157 (E.D. Pa. 1980).
Plaintiffs also attack the current franchise agreement between Comcast
and Falls Township on the basis that there is no evidence that it
received the requisite approval from the Township Board of Supervisors.
Section I.C of the franchise agreement itself states that it "shall
become effective upon signing by the Board of Supervisors and the
Franchisee." The copy of the agreement before us, which provides a
ten-year nonexclusive franchise, is signed by the Township Manager and by
representative of Comcast, the franchisee. The Supreme Court of
Pennsylvania "has often held that there is a legal presumption that
municipal officers are presumed to have properly performed their duties
and to have taken the steps necessary to give validity to their official
acts." Mamallis v. Borough of Millbourne, 164 A.2d 209, 211
(Pa. 1960) (internal punctuation omitted). See also Kennedy v. Upper
Milford Twp. Zoning Hearing Bd., 834 A.2d 1104, 1123 (Pa. 2003). The
plaintiffs have presented no evidence that the Board of Supervisors did
not approve the agreement and did not authorize the Township Manager to
sign on its behalf. Nor have plaintiffs shown that the Township has
dishonored the agreement on this or any other ground or that the
agreement is not authentic. See Mamallis, 164 A.2d at 211.
Thus, based on the presumption under Pennsylvania law, we find the 2002
franchise agreement to be valid and effective.*fn7 See id.
In addition to its legally enforceable contractual rights, Comcast
contends that the federal regulation §§ 76.804(a)(1) is not applicable
because it also has the statutory right to remain on the premises and
television service under the Tenants' Rights to Cable Television
Act, which, as noted above, is part of the Pennsylvania Landlord and
Tenant Act. 68 Pa. Stat. Ann. §§ 250.501-B, et seq.
Pennsylvania is known as a "mandatory access" state because it gives a
cable television operator mandatory access to an apartment building or
complex upon the request of a tenant. See FCC First Order on
Reconsideration and Second Report and Order In the Matter of
Telecommunications Services Inside Wiring, CS Docket No. 95-184, MM
Docket No. 92-260 (January 29, 2003), found at
68 Pa. Stat. Ann. §§ 250.501-B, et seq.; Surnamer v. RCN Telecom Servs.
of Pa., Inc., No. Civ.A. ...