Charter Communications, Inc. v. County of Santa Cruz

ORDER DENYING PLAINTIFFS’ MOTION FOR SUMMARY JUDGMENT AND DENYING DEFENDANT’S MOTION FOR SUMMARY JUDGMENT

INTRODUCTION

In this action for infringement of plaintiffs’ First and Fourteenth Amendment rights of free speech under 42 U.S.C.1983, and affiliated state-law contract claims, this order denies plaintiffs’ motion for summary judgment and denies defendant’s motion for summary judgment.

STATEMENT

This case arises out of defendant County of Santa Cruz’s denial without prejudice of consent to plaintiff Paul G. Allen’s 1998 purchase of the outstanding shares of a cable operator, plaintiff Charter Communications, Inc. (“CCT”). At the time of the purchase, CCI owned plaintiff Charter Communications Properties, Inc. (“Charter”), which pursuant to a written franchise agreement, ran and operated a cable system in the County of Santa Cruz. Under the franchise agreement, the County’s consent was required for the transfer but could not be “unreasonably withheld.” The meaning of that phrase is the crux of this dispute.

On May 19, 1998, the County entered into cable television franchise agreement with Charter, which had obtained the Santa Cruz “South County Franchise” from a company…