UNITED STATES v. N. J. STATE LOTTERY COMM'N

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Argument of Lawrence G. Wallace

Justice William O. Douglas: 73-1471, United States v. New Jersey State Lottery Commission.

Mr. Wallace and Mr. Skillman, the Chief Justice who's necessarily absent has asked me to state that he plans to sit in this case on the basis of the record and the briefs and the recorded -- a tape that we have of the oral argument.

Mr. Lawrence G. Wallace: Thank you Mr. Justice Douglas and may it please the Court.

This case arose on a petition by Jersey Cape Broadcasting Corporation, a broadcast licensee in New Jersey, seeking a declaratory ruling from the Federal Communications Commission.

Jersey Cape pointed out to the Commission that the winning number in the New Jersey State Lottery is selected every Thursday and that many of the listeners to the broadcast station were interested in learning what the winning number was and many of them knew that the broadcast stations were informed of that number on their wire service and were telephoning the station to ascertain the number.

The Jersey Cape wanted to know the Commission's opinion on whether it's proposal to broadcast on three successive newscasts, each Thursday, the statement that the winning state lottery number drawn today is and they recite the number, whether that would violate Section 1304 of Title 18 of the United States Code.

That provision is set forth in the government's brief on page 2 and it provides summarizing the pertinent language, whoever broadcasts or skipping down, knowingly permits the broadcasting of any advertisement of or information concerning any lottery, skipping down three lines, or any list of the prizes drawn or awarded by means of any such lottery, skipping, whether said list contains any part or all of such prizes shall be fined not more than $1,000.00 or imprison not more than one year or both.

The Commission in response to this request issued a declaratory ruling stating that in its view, this broadcast, the proposal would violate Section 1304 of Title 18.

It based this view on an interpretation of this provision that had been developed in a decision of the Second Circuit Court of Appeals in 1969, called New York State Broadcasters and on the Commission's further proceedings on remand in that case which was also a case involving a declaratory ruling.

In that case, the Second Circuit and the Commission had both held that the statute applies to legal as well as illegal lotteries and applies to not only to advertisements, but also to information directly promoting a legal or illegal lottery.

The interpretation limiting the words information concerning any lottery was based in part on the face of the statute itself, which goes on to specify or any list of the prizes drawn or awarded which would have been surplusage if Congress had intended to use the word information as comprehensively as possible and I might add that the interpretation also could quite properly be based on the fact that at the same time that this provision was enacted, Congress reenacted the 47 U.S.C. 326, which is also set forth on page 2, guaranteeing broadcast licensees the right of free speech and protection from censorship by the Commission.

The Commission held with respect to this --

Justice Thurgood Marshall: Wasn't this statute aimed at illegal lotteries?

I know, it didn't say so.

Mr. Lawrence G. Wallace: Well Mr. Justice that the question was addressed by the Second Circuit and by the Commission and we've discussed it in our brief.

The history of --

Justice Potter Stewart: There was no such thing as illegal lottery at the time of the enactment?

Mr. Lawrence G. Wallace: At the time of the enactment of this particular --

Justice Potter Stewart: So, all lotteries are illegal?

Mr. Lawrence G. Wallace: -- statute, but this statute is one in the series of anti-lottery statutes that Congress enacted foreclosing the channels of interstate commerce and the channels of communication regulated by Congress to the promotion of lotteries including the use of the mails.

The -- those statutes go back to 1827.

Justice Thurgood Marshall: Well, it doesn't go because it's gambling, does it?

Mr. Lawrence G. Wallace: The 19th Century statutes were enacted at a time when there were legally authorized lotteries in the United States.

Justice Thurgood Marshall: What's striking as funny is that you can't broadcast result of the lottery, but you can broadcast the result of a horse race, including the odds?

Mr. Lawrence G. Wallace: That it's true under the Commission's ruling.

The only statutory bar that Congress has enacted is on lotteries and --

Justice Thurgood Marshall: And the Commission doesn't propose anything beyond that?

Mr. Lawrence G. Wallace: The Commission does not.

There is a considerable difference between reporting race results and reporting a lottery number because the lottery number as the Commission pointed out has no meaning to the general listener who is not holding a lottery ticket.

It conveys nothing to the audience other than whether those holding a ticket are holding a winning ticket or not, unlike the results of the sports contest or a race or market quotations or other kinds of broadcast where people are interested in the market, in the racing --

Justice Thurgood Marshall: Do you think anybody would listen to horse race results who didn't bet?

Mr. Lawrence G. Wallace: Well, I know people attend races and don't bet.

Justice Thurgood Marshall: You do?

Mr. Lawrence G. Wallace: I have done so.[Attempt to Laughter]

Those people may not be the most expert on what's happening in the races, but it certainly is true that race results can be of interest to people who are following the sport, regardless of whether they've bet on the particular race or whether they bet on any race.

Justice Thurgood Marshall: Well, we don't have to decide whether or not Congress could do it, the point is that Congress has singled out lottery?

Mr. Lawrence G. Wallace: It has singled out lotteries.

Justice Thurgood Marshall: And that's it.

Mr. Lawrence G. Wallace: And it deliberately did so in the course of the development of this legislation in the 19th Century.

We recounted the history in our brief.

At that time that the word illegal was removed from some of these prohibitions.

In 1876, there was a debate specifically on this point.

There were some who advocated restricting the statutory prohibition only to illegal lotteries and thought that the function was to aid the states in their enforcement of the law against lotteries, but the prevailing view was no that lotteries themselves are an evil even when authorized by state law as the Louisiana lottery was until from almost 20 years later in 1893, and that the channels or the use of the mails should be forbidden to lotteries.

Now, in 1934, when this provision was enacted, there weren't any legal lotteries in the United States, although there were legal lotteries elsewhere, being conducted elsewhere for which tickets were sometimes attempted to be sold in the United States, and the predominant purpose shown in adopting this prohibition for broadcasters was to put them in the same position as publishers of Newspapers or of circulars who were forbidden to use the mails for this purpose.

And Congress drew no distinction on the face of the statute between legal or illegal lottery and there is no reason to read one in.

The predominant intent was to apply the law as it had been developed with respect to the other lottery prohibitions and this Court held in the Rapier case in volume 146 US and in the Fabrizio case in volume 385 US that some of the other prohibitions do apply to legal as well as illegal lotteries.

As the Second Circuit put it, Congress had long since stopped distinguishing between legal and illegal lotteries in the lottery legislation.

Now, there have been since the more recent development of official state lotteries, there have been efforts in Congress to amend the statute to make an exception for broadcast concerning the -- well, the Attorney General testified today in support of an amendment, which would in effect moot out this case since this case is merely a declaratory ruling, it's still in committee and we will keep the Court advised in any developments.

Unknown Speaker: (Inaudible)

Mr. Lawrence G. Wallace: Well, the testimony was in the senate today.

Previously a house subcommittee had reported favorably.

There is controversy in Congress.

There are some difference of opinion about what form the amendment should take, whether it should apply to state authorized lotteries or only the state run lotteries.

The department taking the position that you apply only to state-run the lotteries and there some other questions to be ironed out, let alone the ultimate question of whether it will be enacted.

Justice Harry A. Blackmun: Generally, does the department feels that something will be forthcoming?

Mr. Lawrence G. Wallace: That is our expectation.

The department is proposing that Congress act and the Federal Communications Commission is deferring to the Department of Justice on what Congress should do in this area.

And it has consulted closely with the Department of Justice in its administration of the statute to the extent it's -- had occasion to administer it and mostly in just the declaratory rulings that it comes to the Court's attention.

Now, not only it seems to us and the Third Circuit did not disagree on the legal -- illegal aspect, no basis for -- well, perhaps I should stop and tell the Court what the Third Circuit did hold in this case after the Commission pointed out that in its view the purpose of -- or the function of such a broadcast would be to help in conducting the lottery and the number would be of interest only to the limited class of persons holding lottery tickets and would serve only that function.

Justice Potter Stewart: The limited class is a -- isn't it a majority of the adults in New Jersey?

Mr. Lawrence G. Wallace: Well, at some two and three quarter million persons, this in an atypical First Amendment case in that regard Mr. Justice.

It's usually a minority interest of some kind that is seeking protection from the courts against legislation in the First Amendment case.

We concede however that the majority is also protected by the First Amendment.

Justice Potter Stewart: Well, is it the press case, now free speech case, is it?

Mr. Lawrence G. Wallace: Yes, it is put in those terms.

There is a First Amendment claim here and --

Justice Potter Stewart: There's a claim of broadcasters not the claim of the listeners aren't -- no listeners went to the Commission or the courts, did they?

Mr. Lawrence G. Wallace: Well, the broadcaster is not in this Court, only the New Jersey State Lottery Commission is in the Court.

Justice Potter Stewart: It's the Lottery Commission, you're right, right, right.

The broadcaster went to the Commission?

Mr. Lawrence G. Wallace: They went to the Commission and after the Commission's ruling, the New Jersey State Lottery Commission --

Justice Potter Stewart: Right.

Mr. Lawrence G. Wallace: -- petitioned for rehearing saying it was agreed --

Justice Potter Stewart: Right.

Mr. Lawrence G. Wallace: -- by the ruling.

The broadcaster did not seek rehearing nor did the broadcaster seek review in the Court of Appeals.

It was the state lottery Commission who pointed out the large numbers of people who are entrusted and the Commission's response was this and they also pointed out that they had no way of knowing who had what number.

They had no record of who won the lottery and it was important for them to disseminate the number to the ticket holder in order to consummate the lottery and the Commission said, this just reconfirms our view that the function of this is -- it's an ingredient of the lottery rather than the kind of discussion or a commentary upon the lottery or documentary that is not prescribed by Section 1304.

Justice William J. Brennan: Mr. Wallace, I think you disagree with my brother's Stewart's that this is a free press not free speech?

Mr. Lawrence G. Wallace: Well, I said it can be termed that, I --

Justice William J. Brennan: Well, the reason I asked you is because 326 as I read the Fifth Circuit's opinion (Inaudible)

Mr. Lawrence G. Wallace: They did Mr. Justice --

Justice William J. Brennan: The wording of 326 --

Justice Potter Stewart: -- is free speech.

Mr. Lawrence G. Wallace: It's free speech.

Justice William J. Brennan: There's nothing about it, isn't so?

Mr. Lawrence G. Wallace: That is correct Mr. Justice and --

Justice William J. Brennan: Do you think 326 right of free speech includes free questions?

Can 326 be involved here?

Mr. Lawrence G. Wallace: Well, our view of 326 is that except for procedural limitations on the ability of the Commission to issue restraining orders by way of censorship and not that as not involved here.

The Commission issued no restraining order of any kind that it provides for the protection of the First Amendment.

Now, it's specifies only right of free speech, but it doesn't really matter since the First Amendment protects the freedom of the press, whether 326 reiterates that or not.

So, we haven't taken a position on it, it seems immaterial.

Justice William J. Brennan: (Inaudible) reads more like a free press, emphasis on (Inaudible) and then it does involve free speech?

Mr. Lawrence G. Wallace: That is correct.

Justice William J. Brennan: Unless there must be that at least you thought that right of free speech, 326 raises also the question?

Mr. Lawrence G. Wallace: Well, that seems to be the implication that it was a unanimous opinion for the Court en banc and in the first place, the opinion draws no distinction between legal or illegal lotteries.

It doesn't question the Commission's holding that the statute applies to legal lotteries and its rationale would seem to apply to a newscast announcement of the winning number of an illegal lottery as much as it applies here.

Its rationale is based entirely on the fact that this is considered news by the licensee and he wants to announce it on his newscast and that's an exercise of protected broadcast journalism in the Court's view, which the implication is that First Amendment wouldn't allow Congress to interfere with and then the Court proceeded to interpret the statute as not reaching it.

And by holding that the statute applies only to -- well, I hesitate to say only to advertisements, only to promotions as they put it, at the bottom of page 10 of our brief, we have the relevant excerpt restricting the application to promotion of lotteries for which the licensee receives compensation.

Whether that would include a sponsored newscast isn't made entirely clear but presumably it would not, that would be protected if the sponsor of the newscast with the New Jersey State Lottery Commission, I don't know what the Third Circuit's view would be.

But that is the line drawn and perhaps it would be a line drawn between a newscast sponsored by the New Jersey State Lottery Commission, which is known to announce this winning number each Thursday or an announcement sponsored by the New Jersey State Lottery Commission of the winning number each Thursday.

If so, it doesn't seem like a very persuasive line to us if there's a constitutional right to have this announcement made and the licensee is willing to sell the time to the New Jersey State Lottery Commission, why doesn't the New Jersey State Lottery Commission have the right to make it and as the New Jersey State Lottery Commission exercising her right of freedom of the press in that situation.

The implications of New York Times against Sullivan would be that an advertiser is speaking as a part of the press when he publishes an editorial advertisement.

Justice Potter Stewart: Well, you know that the -- in the New York Times case, the defendant was not the advertiser, it was the New York Times?

Mr. Lawrence G. Wallace: That is correct, that is correct.

There could be a debate about whether when the Commission licenses someone, the Commission is thereby giving him a right that someone else sold broadcast time by the licensee does not have under the First Amendment.

We think not at least in the context of this case.

As we see the case, it does involve basically a constitutional issue since there Congress deliberately chose to say or information as well as advertisements and its only under the constraint of the constitutional holding that a court would be justified in effect striking that language from the statute and we get our law basically on this subject from the two recent decisions which we think are the closest in point, one the Capital Broadcasting case in which this Court in a summary affirmance upheld the constitutionality of the statutory bar of cigarette advertising on the airwaves.

And the other the Pittsburgh Press case, there both the holding in the opinion dealing with limitations that can be imposed on certain kinds of advertising or which we take also apply to promotional announcements that would not be compensated.

The examples given in the Pittsburgh Press case where that the Court had and no doubt that there could be a ban want Ads proposing the sale of narcotics or soliciting prostitutes.

I take it to this would be true whether the want Ad where run as a public service or whether it was paid for by the sponsor or whether it was the newspaper publisher itself that was selling the narcotics and ran announcement of where they could be purchased from the newspaper and it seems to us that this is the basic principle that governs here.

This is not constituted of the participation in a lottery, is not a constitutionally protected activity.

It's an activity that can be suppressed by the proper government.

In this case, some states have seen fit to authorize lotteries run by those states but it is still Congress that has the authority to decide what uses are impermissible over the airwaves.

If it has decided that promoting the sale of cigarettes or promoting the sale of lottery tickets is a use to which the airwaves should not be put, this is within the constitutional power of Congress, so long as it doesn't impinge upon the right fully to discuss debate and inform the public about the conduct of the affairs of such an enterprise.

And in this case, it seems to us to be an extreme example of an application of the statute which does not cut off any information to the public because the numbers mean nothing outside of the context of their role in consummating the lottery.

May I reserve the balance of my time?

Justice William O. Douglas: Mr. Skillman.

Argument of Stephen Skillman

Mr. Stephen Skillman: Mr. Justice Douglas and may it please the Court.

This appeal involves solely the questions whether the lottery provision of the Federal Communications Act, Section 304, prohibits broadcasters from broadcasting winning lottery numbers as part of regular news shows and if the lottery provision may be read to reach that far, whether it violates the free speech and free press guarantees of the First Amendment.

Section 304 by its terms prohibits the broadcasting of any advertisement of or information concerning any lottery.

It should be clear initially as I believe as been conceded by the FCC, that this section cannot be read literally to prohibit any mention whatever by broadcasters of information relating to a lottery.

If there were any notion that it could be or should be, or was intended to be read this way, it would be patently unconstitutional because it would prohibit for example even discussion of information about the lottery in the context of an editorial condemning the lottery or encouraging the lottery or so forth.

So, such and interpretation would be clearly unconstitutional and for that reason, the FCC has conceded that a strict literal reading on the statute would be inappropriate.

Justice Byron R. White: On the other hand, could the -- could the Congress validly prohibit the station from itself conducting a lottery over the airwaves?

Mr. Stephen Skillman: I would think Your Honor that it could, although that even -- the response to that question may have been confused somewhat by the passage of time and the widespread circumstances under which other types of gambling operations are at least advertised on radio and television, but I think despite that the changes that have occurred in the last few years, the answer today is probably still yes whether --

Justice Byron R. White: And if it were found here and validly so that the station was actually participating in the conduct of a lottery, would you have the same result?

Mr. Stephen Skillman: I think that would be a far different case if the lottery were -- if the station were participant in the lottery as distinguished from exercising editorial judgment and seeking to meet a public demand for information that would be a far different case from the one that that is in fact before the Court.

Justice William H. Rehnquist: What if the only place you could get information as to the lottery winning number was over the radio?

Mr. Stephen Skillman: I would be inclined that in fact is not true.

There are the --

Justice William H. Rehnquist: But what if it were?

Mr. Stephen Skillman: That of anything might exacerbate the First Amendment problem.

Certainly, it would cut off people who have an interest in the lottery, cut them off from all information about lottery and I would think for that reason it would not -- it would make the problem even more severe perhaps but that is the theoretical, there are many other sources of information as to the winning lottery number, including the newspapers for one as well as postings at various lottery locations.

If it is once conceded that a literal interpretation of 1304 is inappropriate then the question becomes what does this section mean?

I think in addressing ourselves to that question, it is important to bear in mind that there were no legal lotteries at the time Section 1304 was included in the Federal Communications Act and it is therefore clear that even if 1304 may be said to be addressed to legal lotteries as well as illegal lotteries because the distinction is not specifically drawn in the statute, that nonetheless it must be read in a manner consistent with the setting in which it was enacted.

And by this I mean that at that time in 1934, there could have been no conception in the minds of the members of Congress that there would be a legal state lottery which would be at such widespread public interest that there might be the type of public demand for the winning lottery number that could lead the broadcast news media in the exercise of its editorial discretion to conclude that there was a public demand to know the winning number and that therefore it should be included as part of a regular news show.

I think secondly that 1304 must be construed in light of Section 1302.

The FCC has urged this point in stating that 1304 applies to legal as well as illegal lotteries and we are not disputing that point, but I think that the -- if the FCC is going to rely on 1302 for that conclusion then it is also fair for us to rely on 1302 for the further conclusion that the newspapers, that there is no prohibition and has been no prohibition in the past on the newspapers including as part of the news article the winning number in a lottery and for those newspapers to be sent through the mail.

Starting with several early cases in the 1880's which are cited in our brief, the Comaford and Mason cases.

The Courts in those cases, it were not decisions of this Court but of lower Federal Courts, construed the lottery prohibitions of 1302 and used the mails very, very strictly and taking the premise that 1304 was patterned after the 1302 it is appropriate for this Court to give 1304 a similarly narrow construction.

It also must be kept in mind that 1304 is a penal statute, a violation of 1304 by a newscaster could lead to incarceration and/or a fine is therefore appropriate to construe 1304 strictly and to apply it only to those commercial ventures, commercial situations which are clearly within its parameters.

Justice William J. Brennan: Getting back, Mr. Skillman, are you suggesting that there's no legal lotteries when this was -- the statute was adopted?

Are you also arguing that -- in that light as to the statute is not including illegal lotteries in order to avoid reaching the First Amendment question?

Mr. Stephen Skillman: We are not taking the position, Your Honor that 1304 does not apply to legal lotteries.

We think that in light of the legislative background of 1302 and the fact that 1304 was patterned after 1302, that we probably have to make that concession and I might add that all of the members of the Second Circuit that have considered this issue as well as all the members of the Third Circuit who considered this issue have come to that conclusion.

Justice William J. Brennan: Well, the reason I asked, I notice that your brief at page 12 has a sentence accordingly Section 1304 should be construed so as to avoid these substantial constitutional policy, citing Machinist and (Inaudible)?

Mr. Stephen Skillman: The substantial constitutional problems to which we avert are the basic free speech and free press problems.

Justice William J. Brennan: Oh, I know but we could constitute 1304 as not including legal lotteries, obviously we wouldn't have to reach the --

Mr. Stephen Skillman: I think that if you could do that that would avoid the First Amendment problems but I would have some difficulty urging to the Court that it should reach that conclusion in light of the legislative history.

There are, however, very, very substantial First Amendment problems in this case if the Court comes to the conclusion that 1304 must be --

Justice Byron R. White: What do you -- how do you suggest that we construe 1304, to exclude what?

Mr. Stephen Skillman: To exclude winning lottery numbers that are broadcast as part of the regular news show.

That's the only question that's before --

Justice Byron R. White: Whether the lottery is legal or illegal?

Mr. Stephen Skillman: That would not matter.

I do think that if a broadcaster were broadcasting illegal lottery numbers as part of -- a part of new show that there might be questions as to whether it was fulfilling its obligations under the public interest standard of the Communications Act, so I'm not suggesting that that could be freely done.

That would be a different question, but what we are talking about here is the exercise of editorial discretion by a broadcaster and there are various kinds of topics of I think that generally receive less moral approval than lotteries and gambling that are the subject of news broadcast.

We can take the prostitution for example as the subject of news broadcast and a feature broadcast whether it be legal prostitution and the few counties where that is in Nevada or illigal prostitution in Times Square in New York.

Justice William H. Rehnquist: They don't give you telephone numbers then, do they?

Mr. Stephen Skillman: They do, Your Honor indicate where legal prostitution or illegal prostitution takes place which may be even more helpful information for an interested party than the type of information that the State of New Jersey is -- that the broadcasters are providing --

Justice William H. Rehnquist: What if lotteries were illegal in New Jersey?

Would you say that the First Amendment prohibited the state of New Jersey from making punishable the broadcast that your people may or that the broadcasters sought to make here?

Mr. Stephen Skillman: If they were illegal --

Justice William H. Rehnquist: If they were illegal?

Mr. Stephen Skillman: I think we would still have First Amendment problems, Your Honor, but it would certainly be a much more difficult case.

I think that the element of legality versus illegality is a significant one, but I think that if we made an attempt to completely prohibit the broadcast news media from mentioning winning numbers, there still might be First Amendment problems.

It would be a tougher -- it would be a closer First Amendment case, but I think there still would be a First Amendment issue that might be raised there by the broadcasters.

There are only certain narrow exceptions to full First Amendment protection for speech such as the broadcasting of winning lottery numbers.

One recognized exception is that for commercial speech and I think that's significant here because it is commercial speech cases that the FCC is relying upon.

They have relied upon the Capital Broadcasting Company case which involved the congressional legislation prohibiting the broadcasting of cigarette advertisements.

They have relied heavily on the Pittsburg Press Company case which sustained a Pittsburg ordinance prohibiting sex-based advertisements for employment.

Both cases clearly arising in the context of commercial speech where the author of the communication was seeking his own commercial gain.

Here by contrast the author of the communication is the broadcast news media who are providing this information to the public in response to what they have decided in their editorial judgment is a public demand for the information.

The communication is thus the very heart of the First Amendment.

Justice Thurgood Marshall: But you represent the state of New Jersey, don't you?

Mr. Stephen Skillman: That is correct, Your Honor.

Justice Thurgood Marshall: And doesn't the state have a commercial interest in it?

Mr. Stephen Skillman: I think the state does have a commercial interest although I might say that the --

Justice Thurgood Marshall: (Inaudible)

Mr. Stephen Skillman: That the commercial interest here is in producing revenue for education and for public institution so perhaps it's a commercial interest of a different dimension than that what is involved in the other commercial speech cases, but the First Amendment interest --

Justice Potter Stewart: Would this be a different case you supposed if the facts were these that you had offered to pay the broadcasting company so much per spot announcement of the winning number every Thursday and it had expressed the willingness to accept your offer and had gone then.

Then everything else has, as in this case, had gone to the Commission and the Commission said no, sorry.

Mr. Stephen Skillman: That would be a totally different case.

Justice Potter Stewart: It would be totally a different case --

Mr. Stephen Skillman: First of all, we'd be clearly under 1304 because 1304 mentions advertisement and I think that kind of a promotion --

Justice Potter Stewart: Yes, yes, but would you -- would be a different case constitutionally?

Mr. Stephen Skillman: Constitutionally, I think that we would be within the realm of the commercial speech doctrine.

I think we still might be before this Court arguing that the FCC had not shown the type of overwhelming or compelling public need for the restriction to justify it.

But I think it would be a different case, I think it would be a much harder case.

In this case, we have no payment of money by the state and we are not the author of the communication, it's rather the broadcaster who is doing this in response to what it conceives to be a public demand for the information.

Justice William H. Rehnquist: Well the Court's opinion in Pittsburg Press didn't speak in terms of an overwhelming or compelling state demand, did it?

It simply says it was a permissible state policy.

Mr. Stephen Skillman: It did not speak in that terms Your Honor because it found the speech to be commercial speech. In that sense, perhaps, I did misspeak myself in responding to Mr. Justice Stewart, but in this context, once we get away from commercial speech and to news broadcasting, clearly a compelling or overwhelming public interest is required to sustain any type of restriction upon the press.

Justice Harry A. Blackmun: Mr. Skillman, I think I am bothered a little too because I sense from your remarks that the public interest is a definite factor in news, information becomes news because there is public interest in it, I think this is what you're sayin.

What if the lady's aid society of some church in Cape May in New Jersey had a raffle and there was intense interests in Cape May but nowhere else in the state of New Jersey, would this mean news as you regarded and broadcastable?

Mr. Stephen Skillman: I think that that might depend on a factual inquiry as to whether the broadcast were made by the broadcaster as an accommodation to the group that was holding the raffle in which event one might not classify this as news or whether the broadcaster came to the conclusion that's editorial judgment that there were sufficient public interest in the information that wholly apart from any accommodation to the person holding the raffle.

It felt that there was a public demand for the information and then I would say yes, that it would be news.

So, I think it really comes down to that process, who is the author of the communication and if it can be said that it's the press that then it's protected by the First Amendment.

Justice Harry A. Blackmun: Let me ask one more question, while I have you interrupted.

Do you distinguish between broadcasting the names of winners as was the case in the Second Circuit case and broadcasting the numbers as is the Third Circuit situation?

Mr. Stephen Skillman: No, I think conceptually if the broadcast news media comes to the conclusion of the names of winners are news worthy and certainly there have been front page newspaper stories and television features in New Jersey about the winners of the millionaire lottery.

There's tremendous public interest in someone who is made a millionaire overnight and I've no doubt whatever, I don't think the FCC has even taken the position that that type of communication falls within 1304.

Justice William J. Brennan: Even though there's the information concerning any lottery?

Mr. Stephen Skillman: That's correct, if on a very technical literal analysis it would be information concerning a lottery and I think that's the reason that even the FCC concedes that a literal analysis or a literal construction of 1304 would not be inappropriate -- excuse me, would not be appropriate.

The second basic exception to First Amendment protections which is relied upon by the FCC are those cases dealing with communications in furtherance of illegal activities such as mail fraud schemes or misrepresentations in advertisements that maybe endanger the health of purchasers of consumer products.

All of those cases however deal with communications by the parties engaged in the illegal enterprise for their own property.

The cases are thus closely related to the commercial speech cases and do not implement or do not implicate the basic rights of the press under the First Amendment and secondly, all of those cases deal with illegal activities.

The mail fraud, the misrepresentation in advertising is declared to be illegal and for that reason the public interests in preventing that form of communication is evident.

Here on the other hand, the subject of this communication, winning lottery numbers is itself clearly legal under state law and as far as federal law is concerned, I think it must be concluded that the federal position is ambivalent at best.

The Federal Government has imposed certain restrictions such as that contained in 1304 whatever it may mean, but in other instances it is permitted, Federal Banks for example, to handle the record keeping and handling of money in connection with the lottery.

So, it's permitted the mailing of newspapers and other communications through the mail so you have ambivalent federal position.

Therefore, in any view of the First Amendment, the restriction that the FCC has expensed in interpretation in 1304, imposes on broadcasting could only be sustained if there were some overriding public interests, but the FCC has not urged even any significant public interest in their brief in this case.

They merely made the conclusionary statement that lotteries are suppressible.

The point is that they haven't been suppressed, that they are legal and that the broadcast news media in its editorial discretion has concluded that there's sufficient public interest that the public should be advised as to the results of the lotteries.

For this reason, the communications enjoy First Amendment protection and if the Court finds that 1304 must be interpreted to reach this type of communication and we submit that it doesn't have to interpret 1304 in this manner then that statute would be unconstitutional in these applications.

Justice William O. Douglas: I believe you have six minutes left, Mr. Wallace.

Rebuttal of Lawrence G. Wallace

Mr. Lawrence G. Wallace: Alright.

Let me first say that the Department of Justice's view is not that newspapers listing winning numbers can be mailed without violating 1302 and our understanding is that most newspapers leave the winning numbers out of their mail editions that's why they're often printed in a little box by themselves.

Justice William J. Brennan: Mr. Wallace, what about the interview with the millionaire winner?

Mr. Lawrence G. Wallace: That is not barred by 1304 under the Commission's view spelled out under remand in the New York state broadcasters and that's on page 849 of 21 FCC II, paragraph 11 deals with interviews, with persons holding winning lottery tickets, relating among other matters of general interests of the number of tickets they purchased, their expectation of winning a prize, their reaction upon learning that they held winning tickets and what they did or intend to do with the prize money.

Justice William J. Brennan: Well, it is information concerning a lottery?

Mr. Lawrence G. Wallace: Yes.

Justice William O. Douglas: What page number was that?

Mr. Lawrence G. Wallace: That's on page 849 of 21 FCC II.

The whole opinion on remand, it starts at 846 in which --

Justice William J. Brennan: And what's the distinction?

Mr. Lawrence G. Wallace: Well, the Commission in the Second Circuit said that the word information has to be interpreted narrowly to apply only to information directly promoting a lottery and not to interview his commentary documentary --

Justice William J. Brennan: What I'm asking, I can't imagine a better promotion than interviewing someone who's won a million dollars?

Mr. Lawrence G. Wallace: Well, it's not hawking.

It's not telling people where to buy lottery tickets and urging them to do so.

Justice William J. Brennan: I bet you know a lot of people run out and buy them in consequence?

Mr. Lawrence G. Wallace: Well, the same thing, people might be encouraged to buy tickets by a news program about aid to education that has resulted from lottery receipts and so forth but these are all considered matters of legitimate news interests that are not primarily promotions of the lottery.

Justice Byron R. White: The publications promote an activity the Congress has the constitutional power as prescribed then constitutionality -- and it's also within the coverage of personal holding?

Mr. Lawrence G. Wallace: Yes, that Congress has the power to deny the use of the mails or of the broadcast media to promote activities that Congress believes are injurious to the public and --

Justice Byron R. White: But constitutionally --

Mr. Lawrence G. Wallace: That -- thought that was a much of what holding was in the Capital Broadcasting case with regard to cigarette advertising.

If the exact same jingles or testimonials were repeated voluntarily by the broadcaster on something they called newscast, I don't see the constitutional difference.

Justice Thurgood Marshall: Mr. Wallace, you can have the story and the pictures of all the men winning the million dollars, that's okay.

Could you not --

Mr. Lawrence G. Wallace: That is the Commission's -- that is the Commission's interpretation of 1304.

Justice Thurgood Marshall: Could you announce the number of the winning ticket on that program?

No.

Mr. Lawrence G. Wallace: Well, --

Justice Thurgood Marshall: No.

Mr. Lawrence G. Wallace: The Commission hasn't spoken to that.

It would be more difficult.

Justice Thurgood Marshall: Well, the Commission you said that you can't announce the number?

Mr. Lawrence G. Wallace: The Commission has -- yes, well, --

Justice Thurgood Marshall: They can --

Mr. Lawrence G. Wallace: But the Commission dealt within this case is a proposal that the number be announced weekly at the time of the drawing on a newscast so that someone buying a lottery ticket would know that he could tune in next Thursday and know whether he held --

Justice Thurgood Marshall: And that is more encouraging --

Mr. Lawrence G. Wallace: -- the winning ticket or not and that's a different case from a public interest interview which the Commission really hasn't spoken to.

Justice Thurgood Marshall: But before this, that encourages lottery play and more so then tell somebody that they won?

Mr. Lawrence G. Wallace: Yes, well, --

Justice Thurgood Marshall: I could then say the government said this?

Mr. Lawrence G. Wallace: Because, well, our -- many people think that the lottery statute are outmoded insofar as they apply to legal state's sponsored lotteries and that question is pending before a Congress.

The Attorney General has testified that he thinks they should be amended, but the Congress has adapted a policy judgment here which in the view of many may be quaint now, but it's still entitled to the respect of the Department of Justice and of the Federal Communications Commission in our view of the Courts because it was a permissible policy judgment.

It was based on determinations spelled out in some detail, if you'd like a citation in four Congressional record 4261 to 4264 that lotteries are injurious to people even if they are legally sponsored and therefore the word illegal should be removed from the statute and that view prevailed in Congress and most states today do not permit lotteries.

There are still a large body of opinion in this country that believes lotteries are injurious.

And there some suggestion has been made that even though an activities are protected by the First Amendment, a broadcast on a newscast might be protected by the First Amendment, this would be our right because the Commission nevertheless, could in applying the public interest limitations on licensees discipline the licensee for engaging in such a broadcast.

I find this a little hard to imagine that the Commission applying the sanction for an action that is constitutionally protected.

If it is constitutionally protected to broadcast the number -- the winning number of an illegal lottery, why is that then a basis for Commission discipline?

I have thought that from Pittsburg Press and Capital Broadcasting that it was fairly clear that it would be -- or it could be government could prevent a broadcaster from announcing daily on a newscast where is the best place to buy narcotics today in a way similar to the announcement of where the traffic is flowing better, or which bridge is from the helicopter.

It seems to me that was the implication of those opinions in that the First Amendment issue is not of such difficulty here as to justify tampering with the plain words of the statute and the intent in history behind them.

Thank you.

Justice William O. Douglas: Thank you, Mr. Wallace.

Thank you, Mr. Skillman.

The case is submitted.