Agenda Packets - 1986/05/19 - Laserfiche WebLink

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D. The Morganton, North Carolina Case In October 1966, the City of Morganton grsnted a 20-year nonexclusive franchise for the construction and operation of a cable system to Morganton TV Cable, Inc. The system was transferred thereafter to Suburban Cablevieion, Inc. and then in July 1974 to Madison Cablevlsion, Inc. (hereinafter "Madison"), a wholly - owned subsidiary of TCI. As the franchise was due to expire in October 1986, Madison submitted a propcoal for renewal to the City in December 1983 About that time, the City hired a consultant to analyze its cable needs. In September 1984, the City issued a Request for Proposals in which it invited proposals for the provision of cable service. Proposals were received from Madison, from other cable cohpanies and from the City itself. A public hearing on the proposals was held in November 1984 In April 1985, the City Council tentatively concluded that Madienn'e request fnr —owal al.nuld be denied. The Council then negotiated with the Company about purchasing the system. In September 1985, the Council enacted an ordinance farma:ly denying Madison's request for renewal, denying the propceols submitted b} other companies, and declaring its intention to establish and operate its ovn municipal system. Madison then filed suit for declaratory and injunctive relief; for judicial review of the denial of its renewal request pursuant to Section 626 of the Cable Act; and for damages (including punitive damages), attorneys' fees and costs. Madison Cablevision, Inc. v. City of Morganton, No. SH-C-86-5 (N.D.N.C. filed Jan. 6, 1986). Madison alleges that the denial of its renewal proposal infringes its First Amendment rights; violates its equal protection rights; constitutes a taking of property without due process of law; violates federal and state antitrust laws; violates 42 U.S.C. f 1983; constitutes tortious interference with the company's contractual rights; and lastly, violates trio provisions of the North Carclina Constitution and statutes stipulating the purposes for which revenue bonds may be issued and for which public funds from taxation may be spent.