Private property rights theorists, were they to acknowledge the increased interference conflict that would accompany the propertization of spectrum, might well dismiss the costs of such conflict as
160. See supra Part II.A. 161. See supra Part II.B.3.
insignificant compared with the efficiency gains that a property rights system promises.162 In fact, proponents of spectrum property tend to minimize the challenges of conflict resolution by looking to courts to resolve the disputes of neighboring owners in radio as in land, as if this kind of adjudication were relatively frictionless.163 Specifically, Coase suggested that spectrum owners could vindicate rights against interference through actions like nuisance or trespass and then trade such rights to the entity that most values the interference-free spectrum.164 This basic vision has been incorporated into the work of almost all those who advocate private property rights in spectrum, where nuisance and trespass are invoked as talismans. None of the private property theorists analyzes with any rigor how these causes of action might be applied to interference disputes or identifies the costs that might inhere in the vindication of property rights.
Of all the spectrum property theorists, Arthur De Vany and colleagues, in their 1969 article, devoted the most attention to interference dispute resolution. De Vany advocated a strict liability standard for any transmission within the area that is protected by a spectrum owner’s property rights. Injunctions, he argued, should be granted as a matter of right to any complainant who established that his rights had been violated.165 Although spectrum use has evolved substantially since
162. The early advocates of property rights in spectrum did acknowledge the costs of a private exchange. See, e.g., De Vany et al., supra note 3, at 1507–08 (“Exchanging rights is a costly process; it includes the costs for both buyers and sellers of searching out, negotiating, and enforcing mutually beneficial exchange opportunities.”); see also Minasian, supra note 3, at 269 (“[The proposal has] assumed that emission rights could be defined in terms of single-valued power levels—that signal levels did not vary—and that there was no cost associated with enforcing these rights.”).
163. See, e.g., HUBER, supra note 6, at 72–76 (proposing that common law courts, rather than the FCC, adjudicate interference disputes using theories of trespass and nuisance); Hazlett, supra note 6, at 149 (contending that common law courts can, and always could have, mediated interference disputes); see also RICHARD A. EPSTEIN, PRINCIPLES FOR A FREE SOCIETY 211–12 (1998).
[T]he original device for assigning frequencies imitated the patterns that had long been used for determining the ownership of unowned land: the first person who used a frequency [consistently and regularly over a period of time, with the intention to exclude others] was entitled to keep it in perpetuity. . . .
. . . The basic rights could have been protected by trespass analogies. The frequencies could be used, sold, leased, or mortgaged like any other physical asset.
Id. (footnote omitted).
164. See, e.g., Coase, supra note 2, at 26–29. 165. De Vany et al., supra note 3, at 1521, 1549.
1969, the treatment of spectrum-related, common law actions has not. Pablo Spiller and Carlo Cardilli have recently advocated a property rights system in which there would be a cause of action under “tort law to protect . . . broadcast rights against trespassers” with a damages remedy.166 Faulhaber and Farber have advocated a system of trespass wherein spectrum owners would be liable for any incursion into the spectrum of another.167 At the same time, they also suggest a system of nuisance, implying a system in which liability would lie only where the signal incursions are unreasonable and the harm substantial.168
The casual treatment of liability and remedies in the interference context seems to reflect a belief that spectrum is enough like land that good old nuisance and trespass, no matter how troubled their application in the real estate context, will rise to the challenge spectrum presents. Peter Huber, for example, asserts the following:
Had the courts been given time to develop it methodically, this simple idea [of spectrum ownership] would have created property rights in the ether, much as the common law had created property rights in the land beneath it—rules of trespass, easement, nuisance, and the like that define the bounds of ownership in real estate.169
The apparent source of the private property theorists’ confidence in common law resolution of spectrum disputes is a 1926 Illinois state court’s application of trespass law to a case of radio interference. There, the court enjoined a new broadcaster’s interference with an existing broadcaster, invoking the time-honored principle of property law that 166. Spiller & Cardilli, supra note 3, at 70, 72.
167. Faulhaber & Farber, supra note 147, at 7–8. “In a property rights regime, [restrictions on power emissions] would be codified in the property rights of the frequency owner, who would then be subject to civil penalties should he or she violate these restrictions.” Id.
168. Id. (comparing potential spectrum use limitations to “my right to use my real property[, which] is restricted by noise and nuisance statutes of my state, county and local municipality”).
169. HUBER, supra note 6, at 29. For a critique of Huber’s reliance on the common law, see Tom W. Bell, The Common Law in Cyberspace, 97 MICH.L.REV. 1746, 1770 (1999) (book review) (writing that Huber “too readily embraces a variety of rules that would both clog common law processes and contradict common law principles”); John F. Duffy, The FCC and the Patent System: Progressive Ideals, Jacksonian Realism, and the Technology of Regulation, 71 U.COLO.L.REV. 1071, 1102–03 (2000) (noting how difficult it would have been to establish common law adjudication over spectrum disputes especially given that such disputes were likely to be interstate). Interestingly, Peter Huber has strongly opposed the substitution of common law remedies for administrative ones where environmental pollution is at issue, although it is hard to see why a court would be more capable of resolving conflicts arising from ambient air noise than it would be of resolving conflicts arising from ambient air contamination. See, e.g., Peter Huber, Safety and the Second Best: The Hazards of Public Risk Management in the Courts, 85 COLUM.L.REV. 277, 330–35 (1985) (asserting that courts do not have the perspective to make adequate comparisons of risk in complex environmental pollution cases).
“priority of time creates a superiority in right.”170 Relying on this decision, private property rights theorists suggest that courts might have developed a common law based on real property causes of action to resolve interference claims if Congress had not stepped in to regulate.171 Interestingly, it is not clear how the Illinois court would have resolved the complaint in the absence of executive agency guidance, since it was reliance on administratively-determined technical criteria that guided the judge in assigning liability.172
There is reason to believe that common law courts struggling to sift through complex issues of causation, thresholds of liability, and remediation might have had great difficulty in assigning rights. Like Coase before them, the contemporary property rights theorists neglect the institutional and legal dimensions of conflict resolution.173 Whether the desired common law system would be administered by general common law courts, specialized courts, or FCC administrative law judges is addressed only in passing.174 Whether the law that would be applied would be state common law, federal common law, or some mixture of common law and statutory law or regulation is not addressed at all. Moreover, there is no discussion of why a common law system should be expected to resolve spectrum disputes, particularly in cases of complex interference, when the common law 170. Tribune Co. v. Oak Leaves Broad. Station Inc. (Cir. Ct., Cook County, Ill. 1926), reprinted in 68 CONG.REC. 215, 215–19, 69th Cong. (2d Sess. 1926).
171. See, e.g., Hazlett, The Wireless Craze, supra note 3, at 366–73.
Radio developed in an “orderly” fashion under priority-in-use rules. These rules did not depend on public interest regulation; the rules were enforceable via common law principles adjudicated by federal regulators lacking public interest discretion (as demonstrated by the U.S. Department of Commerce up until July 9, 1926), or by state courts . . . .
Id. at 371; see also Thomas W. Hazlett, Is the “Public Interest” in the Public Interest?: The Broadcast License Bargain of 1927, in TELECOMMUNICATIONS POLICY: HAVE REGULATORS DIALED THE WRONG NUMBER? 49–50 (Donald L. Alexander ed., 1997). 172. For this insight, see Charles Jackson, Was a Common Law Solution to Chaos in the Radio Waves Reasonable in 1927?, Public Notice of FCC Spectrum Policy Task Force, ET Docket No. 02-135, at 9 (F.C.C. filed July 8, 2002).
173. See, e.g., Thomas W. Hazlett, Physical Scarcity, Rent Seeking, and the First Amendment, 97 COLUM. L.REV. 905, 908 (1997); Hazlett, supra note 6, at 148–52; Hazlett, The Wireless Craze, supra note 3, at 339; see also R.H. Coase, Comment on Thomas W. Hazlett: Assigning Property Rights to Radio Spectrum Users: Why Did FCC License Auctions Take 67 Years?, 41 J.L. & ECON. 577, 579 (1998).
174. See, e.g., KRATTENMAKER &POWE, supra note 30, at 17 (advocating a federal court system); White, supra note 3, at31 (same); see also Faulhaber & Farber, supra note 147, at 9 (suggesting special “spectrum” courts or common law courts); Hazlett, The Wireless Craze, supra note 3, at 551–55 (envisioning specialized spectrum courts).
has been largely abandoned in the air pollution context.175
The failure of private property theorists to grapple with the implications of their regime change for interference conflicts calls out for careful inquiry into such conflicts and the way in which a common law system might or might not be able to improve on FCC resolution. Such inquiry, and its implications for spectrum rights in the telecosm to come, follows.
IV. FCC RESOLUTION OF SPECTRUM CONFLICT THROUGH THE LENS OF NUISANCE
Private property theorists advance an essentially deregulatory agenda. They envision a telecosm in which markets liberate communications from government decisionmaking. One of the claimed benefits of this liberation is that access to spectrum will no longer depend on an opaque and often ad hoc administrative decisionmaking process. In this Part, I argue that the characteristics and limitations of nuisance law make it unlikely that these hopes will be realized. The nuisance law emerging from contemporary courts will require normative judgments about preferred communications technologies and consumer applications. Moreover, these judgments will be made by governmental decisionmakers facing the kinds of tradeoffs that have bedeviled the FCC in distributing spectrum usage entitlements. Nuisance law will be unpredictable for those disputes that look like conflicts over land and unsuitable for those disputes that do not. In both cases—within the nuisance case and where nuisance actions will not lie—administrative guidance should play a meaningful role in spectrum dispute resolution.
To assess whether the common law is equipped to resolve spectrum disputes, and what the implications of dispute resolution might be for spectrum management reform, it is necessary to begin with the common law as it exists in the real world.