Loretto v. Teleprompter Manhattan Catv Corp.

458 U.S. 419 (1982)

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Nature of the Case

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Facts

Loretto (P) purchased a five-story apartment. The previous owner had granted Teleprompter Manhattan CATV Corp. (D) permission to install a cable on the building and the exclusive privilege to supply his tenants with cable service. Two large silver boxes were also installed. Initially, D’s roof cables did not service P’s building. They were part of a cable highway circumnavigating the city block. A crucial part of this network was the so-called crossovers; cable lines extending from one building to another in order to reach a new group of tenants. Two years after P purchased the building, D connected a 'noncrossover' line to provide service to one of P’s tenants by dropping the line to the first floor down the front of P’s building and paying the reasonable amount of one dollar. Prior to 1973, D obtained authorization for its installations and compensated the owners at a standard rate of 5% of the gross revenues. New York passed a law in 1973 that prohibited landlords from interfering with the installation of cable television facilities and from demanding payment from the cable company in excess of a reasonable amount. The law deemed a $1 one time payment the normal fee to which a landlord was entitled. P did not discover the existence of the cable on her building until after she had purchased. P claimed that the statute allowed a taking of his property without just compensation and sued D in a class action suit. P wanted damages and injunctive relief. The City of New York, who had granted D an exclusive franchise, intervened. The Supreme Court, granted a summary judgment for D, the Appellate Division affirmed, and the Court of Appeals over dissent upheld the statute. They concluded that the law required the landlord to allow both crossover and noncrossover installations but that payment for noncrossovers was to be determined by the State Cable Commission. The court ruled that the law served a legitimate police power purpose; the elimination of landlord fees and conditions that inhibit the development of CATV, which has important educational and community benefits. The court rejected the taking argument and held that there was no significant economic impact nor any interference with any reasonable investment-backed expectations. The court held there was no taking under the statute. The dissent reasoned that the physical appropriation of property is a taking without regard to the balancing analysis ordinarily employed in evaluating if a regulation is a taking. P appealed to the U.S. Supreme Court.