Fidelity Television, Inc. v. Federal Communications Commission, Rko General, Inc., Intervenor

ROBB, Bеfore LEVENTHAL and Cir *, Judges, Judge, cuit and DAVIS United Court of Claims. States DAVIS, Judge: Nearly years ago, ten intervenor RKO General, Inc. application filed an for a three-year renewal of its license to oper KHJ-TV, ate Channel 9 in Los Angeles. began Thus a long saga which we may even today end by affirming the Commission’s decision in favor of RKO.1 I RKO, a wholly-owned subsidi ary of General Tire and Rubber Compa ny, operated KHJ since 1951. Joint Appendix at 52. Under the Federal Communications Commission’s license-re scheme, newal see 47 C.F.R. § 73.630 (1965), this license came up for three- year renewal with those of other Califor nia licensees and RKO filed an Washington, D. Sweeney, H. Walter application for renewal on August 31, Morgan, P. Edward whom C., with 1965. Two later, months October brief, for C., on the D. Washington, 1965, appellant Fidelity Television, Inc. appellant. filed application an for a construction permit Marino, Associate Gen. build a A. Joseph station at Norwalk, California, R. C., Ashton with whom also to Counsel, operate C. F. on Channel 9 Counsel, Joseph Volpe and to and blanket the same Hardy, Gen. area.2 As appli * permit Sitting by designation necessary pursuant prereq 2. A construction is a to 28 U.S.C. licensing station, 293(a) (1970). a new and uisite § cases, except guarantee in rare it is a also of a operate the station licensee once construct provisions the “holdover” of the Fed- 1. Under § 47 U.S.C. ed. C.F.R. 1.68 § Act Commis- eral Communications (1973). While 9 is allocated Channel to Los rules, operating has been sion’s sta- Angeles under the Commission’s overall televi 307(d) (1970); § the interim. U.S.C. tion in scheme, allocation sion C.F.R. 73.606 § 1.62(a)(1) (1973). history § 47 C.F.R. permit rules Commission licensee to emphasizing interplay of deci- this case anywhere operate the station from within 15 by and this court is set out in the F.C.C. sions city miles license. 47 C.F.R. § 73. Television, Inc. decision in our earlier 607(b) (1973). Norwalk is within 15 miles of C., 502 F.2d 443 v. F. C. Angeles. Los (1974). stations, mutually exclusive proposals, for two hearing on the cations tive requests only, opened of RKO issue comparative standard comparative designated February for a record was 1966. Joint on June time on June for the first closed Ibid, 1-2; Ashbacker Radio Appendix see at 45. C., 327, 333, 66 F. C. v.Co. not, This proceeding however, did sim In setting 90 L.Ed. ply run its ordinary course through the comparative hearing, applications for hearing examiner5 and the Commission practice, lim as was after the hearing opened. On March be considered to the questions ited 1967, the Commission released a decision issues,” “standard so-called Chapman Radio & Co., Television e., proposals would better which of the i. four-sided proceeding interest, public and which of serve assignment of a new television station in applications granted. should Homewood, Alabama. 7 F.C.C.2d 213 did standard issues include These competitors One of the had re and certain factors.3 programming quested the addition of a programming issue, and the Review Board had denied provide, how rules The Commission’s request. The Commission took the ever, might petition applicant that an opportunity clarify the relationship enlargement Board for Review general between policy and the incor evidence could be so that issues poration of a programming issue, stating on, pro character or g., e. presented proponent that “a of the programing is 1.229 47 C.F.R. § gramming. sue required should be to make prima 27, 1966, filed such a June Fidelity, on showing facie there are significant addition of three requesting the petition, differences in the programing proposed provide issues: and should relate his claimed substantial fair, equitable efficient a more superiority in program planning to his services; television distribution 4 ascertainment of community needs.” 7 applicant; of each philosophy” “service Chapman F.C.C.2d at 215. was then re significant differences manded to the Review Board to consider applicant. each proposed gramming whether a programming issue should be The F.C.C.’s Re Appendix at 44. Joint added under the clarified standard. Fidelity’s petition on denied Board view Ibid. 27, 1966, and the Commission October Fidelity’s application 9, 1967, On rejected March Fidelity then filed a petition order on December with the Board’s review requesting Ibid, it compara- The itself 29, at 161-63. add programming and Fidelity proposed to construct station application is considered a ming on his set out program- issue, because wished to orient Norwalk non-comparative and is not or- financial “Southland”, ming of the channel to an comparative in the dinarily relevant deemed Fidelity’s Enlarge Co., Petition to McClatchy Broadcasting described area proceeding. See Angeles County lying as the area in Los 343, Issues National Broadcast- 19 F.C.C. city Orange 611, south and east of and Co., to the ing County. Appendix at 198. Joint philosophy” issue deals with an 4. The “service theory of the issue standard programming his applicant’s direct intention to determines before set- to, part to, primarily of the area to hearing ting that each the case for a signal See Central Coast reaches. his which character, financial, legal, minimum (1963); Petersburg has the Television, 35 F.C.C. operate capability to the station technical and Corp., 19 F.C.C. Television purpose public of the interest. determine, hearing to on that hearing 5. The title of changed examiner was basis, public interest which would serve Judge Administrative Law September effective Simplicity Anthony, and Towards better. 6, Fed.Reg. 1972. 37 Since all Rationality Comparative Broadcast Licens- decisions in this case at levels below the Com- Proceedings, ing 24 Stan.L.Rev. mission itself had been made before theory, Anthony], Under this as [cited “hearing title examiner” will be used in program- ability produce applicant’s opinion. advertising time on the basis products issues needs-ascertainment6 defendants, from said it remand to the services or that Chapman, unrea sonable restraint of commerce; . reconsideration in the Board for trade Review ” . . . Complaint application was Chapman. This light of United States General Tire & July ground on the on Rubber denied Co., supra. had offered new origi Responding data on which had and the this new development, data “pri- Fidelity Board, did not amount nally relied filed the Review on 8, 1967, showing” required Chap petition under enlarge facie March ma Apрendix at 171-75. to be compara- man. Joint Fideli issues considered at the petition a further for clari filed tive to include a ty then determination Board, seeking with the Review fication light of all the facts and circum- position tribunal’s to ascertain surrounding Complaint stances applied in effect it had whether filed the United States of America initially. Chapman standards This was 2, 1967, against on March General Tire September Ibid. at denied Company, and Rubber 176-79. General, Inc., quali- whether RKO

fied be a licensee of the facility for applying herein, it is or alterna- Concurrently, on March tively, whether such matters bear suit in the of Justice filed Department upon comparative qualifications of District Court States United General, Inc.; RKO . . . [Joint against District of Ohio Northern Appendix at 164.] Company, Ae- Tire and Rubber General petition The Board denied the on June Corporation, Byers A. M. rojet-General General, saying allega Incorporat Company, and wrongdoing specific were not companies were tions (the latter three sub ed warrant Tire). enough to addition of a United States General sidiaries issue,” Co., “disqualifying character but that Rubber No. Tire & C — 67— v. General and circumstances 1967). “relevant facts form filed Mar. This (N.D.Ohio, ing particularly bases for the civil companies alleged that the four action suit — prac relate to they RKO’s broadcast 1 and violated Sections be adduced Act, in that tices—can under 15 U.S.C. §§ Sherman comparative issue.” Joint had, things, engaged the standard among other they at 167 — 68. The Board also Appendix conspiracy to uti a combination “in any grant to RKO would be whereby purchasing said reciprocity lize right all of said defendants is used to conditioned Commission’s power the case should the outcome reopen actual and persuade certain coerce antitrust suit be unfavorable suppliers of the defendants to potential Ibid. at 169. tires, wrought products, RKO.7 iron purchase etc., Applicants, relates to the 27 F.C.C.2d 650 “needs ascertainment” issue 6. A Miller, quality applicant’s Compare efforts to M. 4 F.C.C.2d and Saul manner Co., needs, by community required Broadcasting (1966) as Minshall discover with Inquiry, 796, Programming (1968), Banc Pleasant Broad- En and 2303, 582, Co., Section IV of casting and 40 F.C.C.2d F.C.C. Authority 301, 202, Application aff’d, F.2d 271 Form for FCC Station, etc. The a New Broadcast Construct for sufficient needs-ascertainment standards 7. The antitrust action was concluded a con- January substantially upgraded decree, judgment effective entered on with October sent renewals, 1, after 21, judgment for television license stated that 1970. The was filed, application “constituting at here was issue the renewal evidence or entered without ad- again by any party respect any Amendment of Section in 1971. See with mission issue Service) Program 1, (Statement Judgment of Broad- IV Final at fact or law.” United 301, 303, 314, 315, Co, Application supra. Forms cast Tire & Rubber It v. General States however, Primer on As- did, restrain.General Tire and its sub- Community RKO, engaging sidiaries, including Problems from certainment requests All also past found that performance for KHJ’s additional issues hav ing disposed of, thus in programming been compara and community rela tions, hearing particularly tive continued standard station’s concen tration on only, presenting issue old films Fidelity ig providing only noring community a “superficial” criticism of excessive inquiry into RKO’s practices. movies, trade violence in some of the Ap poor. Joint was Ibid, pendix at was, 180. at hand, The 143. On the gave record other noted he above, Fidelity closed for the first time demerit for an integration-of- on June 15, 1967, and the hearing ownership-and-management examiner is proposal proposed sued his which he felt was findings September, just created to win the 1967. ibid. 9, 1968, On license and February be implemented. how ever, Fidelity Ibid. petitioned at 150-51. Fidelity, however, the examiner to reopen the superior record to found newly in local ownership, receive dis depositions covered community-needs-ascertainment, taken in and in evidence— providing Government’s for antitrust suit. The diversification of owner hearing ship examiner reopened record, mass media. Ibid. at 149. but cautioned that examiner “It being re berated General Tire’s opened anticompetitive as a repository practices, for the record in but did not give the Ohio a special anti-trust . suit. . . character Peti demerit for tioner asks them. Ibid. reopened record be 148. Finding 144 — the purpose “neither taking bargain evidence on as a reciprocal licensee,” trade broadcast practices of the examiner RKO. chose give With the caveat that such evidence chance to improve must on patently germane performance. be RKO’s RKO’s Ibid. at steward ship of KHJ-TV that language is adopt Soon after the release of this initial ed as words limiting the scope of future decision, station, another RKO WNAC- hearing.” Appendix Joint at 181-82.8 TV, Boston, up came Upon renewal. The record was good closed for on Au the filing of two mutually exclu gust 1968, and the initial decision of sive applications for per construction hearing examiner came down on Au mits, Commission, on December gust 1969, designated the three applications for a comparative decision, hearing. The examiner’s without an RKO Gener al, Inc. (WNAC-TV), enthusiasm, FCC 74D-36 at 2 overabundance of recom (released June 1974). application mended RKO’s for re Included in the hearing order was an granted “anticompetitive” newal denied and issue much like that permit added a construction to build station current case after the record Appendix over Channel 9. closed. Ibid. to take Joint at 3. January On 153. He found that Commis General Tire sion’s Broadcast petition Bureau filed a substantially and RKO had contributed with the Commission development asking broadcast technol KHJ record be reopened capacity good had the ogy and to run consolidat Ibid, ed with However, the WNAC record on station. at 137 — 41. he the anti- charged reciprocity in the com- practices The Board denied Appendix at 183-85. Joint Fidelity’s petition Ibid, case, May in this plaint. In decision Ibid. at 2-5. review, this outcome released Commission determined Commission’s RKO, ex- the Re- September unfavorable found was not reopen become had had therefore the record Bоard’s condition view to decision aminer’s Appendix opportunity nullity.” Fidelity sub- at 5. to provided “a Joint with the anticompetitive con- on RKO’s mit evidence reopen record was petition While 8. by way of re- duct, relief no further so examiner, Fidelity hearing pending before the required. The Com- opening record was request February a second on filed nevertheless, did, to the issues add mission enlargement of the for Board the Review with RKO by whether the examiner be decided whether a determination to include issues demerit disqualified assessed a or should be disqualified a dem- or assessed should RKO Ibid, 187. practices. at for its trade practices. anticompetitive because erit 6, 1973, be before the competitive issue since the evidence December On Ibid. was an ing presented act, the latter case far Commission could court present complete Appendix in the more than that Joint its decision. nounced Appendix at 5. Joint proceeding. 1.10 move, Fidelity opposed the and the Com By vote, a agency divided reversed prob mission’s ultimate resolution hearing granted examiner and go ahead with a conditional lem was application.11 only RKO’s renewal The in this KHJ case and to make expression majority was views in the Fidelity proceed a in the party WNAC joined opinion by Commissioners Robert General, Inc., 31 ing. RKO F.C.C.2d 70 E. Lee and Reid. opinion The found (1971).9 that KHJ had engaged neither in nor argument oral heard benefited from reciprocity, coercive proceeding KHJ on engaged had October patronage mutual 22, 1973, but as of March However, reciprocity. not yet reached concluded, its decision. On day, partially on the basis of the Fidelity filed with this court petition a widespread nature the practice, a for writ of Fidelity mandamus. injunction Tele entered the Ohio anti vision, Inc. v. Federal trust suit Communications was stop sufficient prac Commission, (D.C.Cir., No. 73-1313 filed. tice that RKO should not be denied . 22, 1973). 11, 1973, Mar. On June doing a something arguably license court, refusing while writ, to issue legal when done. Appendix Joint at 10- stated that the Commission’s decision 11. The opinion also determined had been unreasonably delayed past and or performance KHJ’s terms of dered to report progress gramming within 30 community relations days. Commission, Ibid. The although not while “unusually good” “superior” or report 6, 1973, it did July on had still not not was “unusually “insubstantial” dr when, issued a decision November poor.”12 Furthermore, prom RKO had 1973, Fidelity petition renewed its here. ised in its 1962 renewal application no jurisdiction, hearing contending Fidelity participated in WNAC December 6 order represented one of not through “final counsel who also order” within the terms General, of 47 challengers. 402(b)(1) U.S.C. § Inc. RKO rejected the WNAC We (released June contention in (WNAC-TV), an July 3, 74D-36 at order FCC issued opinion and an August 2, added to 1974). Board also The Review 1974. . Ibid. relating proceeding issue the WNAC testimony pro- in the KHJ in its RKO’s candor ceeding. opinion 11. There no subscribed to in toto General, Inc., 30 F.C.C.2d by majority participating of the members. joined Commissioners Robert E. Lee and Reid opinion (Commissioner Justice, meanwhile, in an Department filed Reid without .of hearing argument); disqualifi- urging oral then Chairman Burch with brief agreed concurred in the ment; result without further state- if the Commission cation of RKO Commissioners Johnson H. examiner. Rex Lee the facts found opinions; dissented in Appendix Commissioners Wi- Joint ley participate. Ap- did Hooks Joint decision, Fidelity pendix at 1. After the Commission’s petition for a this court to dismiss moved Comparative 12. See as moot. The Commission writ of mandamus Hearings, Broadcast (1965): move, oppose the and on December 21 did not peti- dismissing the an order this court entered pastA record within the bounds of aver- F.C.C., Television, Inc. v. tion. age performance disregarded will be since average performance expected. future petition filed review then February two 6 order. On December which, We are interested in records be- tacitly finali- it had conceded the months after ty unusually good unusually cause either opposing the December order poor, give per- some indication of unusual petition for a motion dismiss formance in the future. mandamus, the Commission asked writ of Fidelity’s appeal lack of to dismiss court Therefore, provided. than it had more including proposed a rule re- applicants, stated, opinion since the “record the divestiture, quiring opinion the concluded be deemed to be within the bounds must applicant has that “neither made a suffi- performance expected all average of of showing of cient to warrant the award licensees, prefer neither a [it] warrant[s] any preference the under diversification Appendix Joint at nor a demerit.” ence Ibid. criterion.” subject integration, On the of given which the examiner had diversification, opinion Going the demerit, opinion a Fidelity the found the superficially while RKO found that equal. It applicants two said that Fidel- (in category in that the poor looked ity’s conduct as an indi- had licensee of AM and FM company was the gives cated that “the record here little Angeles as well as in sta- stations Los Fidelity that will im- promise effectively a and was share- tions in other states integration promises.” plement paper its sys- in several cable television holder at Appendix Joint On operated tems), station was each inde- hand, RKO was found to have achieved and, pendently particularly in the case of purposes integration control —local KHJ, many media outlets in was one of accountability through policy — dangers Finding market. independence, by requiring station non-diversification, which characteriz- participation community active affairs promotion “any as national or oth- ed employees. station Ibid. political, expression of eco- er uniform Finding two applicants equal thus nomic, opinion,” did or social not exist in factors, on the standard case, the concluded that “we opinion opinion based the ultimate outcome on persuaded the nature of are policy giv that “credit must decision is such as to have interests RKO’s proceeding, en renewal flow of effect on the informa- adverse applicants equal, when the otherwise for the audience to bе served here.” tion public for the value to the contin opinion at 17. The also Appendix Joint Ibid, existing uation of the service.” at that, Fidelity since stockholder found tipped 22. This was found to have in several suburban an interest owned favor, balance RKO’s license newspapers, challenger Angeles Los was therefore renewed —conditional with entirely free of diversification was not respect anticompetitive practices Finally, noting ongoing rule- problems. proceedi the final outcome of the WNAC making proceedings application ng.13 the diversification criterion renewal promised more was it had no We us the Commis- fact do now before case, irrelevant; clearly (3) Fidelity superi- decision in the WNAC which sion’s yet agency’s integration, ownership, issued. That decision and the local not interpretation or ty, diversi- deciding it in re- whether to which the characteristics Commission factors, absolutely plus for KHJ will of course voke RKO’s license often held appealable (4) ad- order of Commis- should have been able to constitute sion, may appealed programming. proposed then be either on its duce evidence Ibid, The fact ultimate 30-33. RKO. dissented, appeala- will be an H. Lee also decision of Commissioner Rex not, thought largely we stated in our he anti- ble final order does because that RKO’s decision, jurisdiction competitive totally disqualify detract from our earlier conduct should Lee, present company.. while not case. 163 Commissioner disagreeing as with Commissioner Johnson’s F.2d at 452. virtues on traditional sessment criteria, Johnson dissented from the Commissioner if the Commission chose stated that decision, calling it “the worst decision of this proceed disregard in a these criteria during my years seven term of precedent ing, should at least follow recent Appendix Joint at 29. He and five months.” objected past performance case on and decide the (1) grounds: on four Lee found “insubstan which Commissioner anticompetitive conduct should that RKO’s 34-42; Appendix A. see H. Belo tial.” Joint licensee; disqualify it that RKO’s as a Corp., was less than mediocre and broadcast record II requirements, could receive the minimum regardless the license the merits considering Before validity operation Anthony, RKO’s KHJ. See Commission’s ultimate decision under the However, supra at note 3 85-87. a applicable standards, is necessary to is, raised, “307(b) issue” properly when procedural consider some prelimi- comparative hearing added order nary points pressed upon us appel- part as compara- and considered lant. See, g., hearing. e. Tier tive Southern First, Fidelity argued (Brief Inc., Service, Radio 19 F.C.C. 496 42) Appellant at this court Telecast, 37 — 22 F.C.C. 625 Louis St. should overturn deci Commission’s disqualify sion or at least then Chairman Commission denied grounds Burch on the that “the decision request 307(b) for addition aof issue be nothing in this case is more than an ex Fidelity cause had failed to make the operational tension of the Commission’s necessary first showing that “the South- bias in favor of incumbent licensees.” land” was a community, sepa let alone a has, Appellant Brief for This bias community rate in need of television claims, appellant been prior revealed in Appendix Joint service. at 160. The decisions of the Commission and in Commission’s cannot be over testimony Burch’s Chairman before Con failing turned. In to define the South- gress. The claim is exactly almost greater specificity, land with Fidelity rejected same as made T. F. request rendered its facially insufficient Institute, C. v. Cement 333 U.S. under previously standards an 700-02, S.Ct. L.Ed. 1010 nounced. In Tier Southern Radio Serv (1948), and we controlling. find that case ice, Inc., supra, 307(b) § was held Next, Fidelity charges that the Com- be relevant because the fatally mission’s ultimate decision was unable to define precision “Greater defective because' it was based on a Endicott.” 19 F.C.C. at 551. When Fi record limited the Commission’s earli- delity failed even to list political er, allegedly improper, decisions to re- up Southland,” units' which make “the strict the to the “standard com- justified the Commission was in reject issue.” parative At points various ing request facially insufficient. proceeding, Fidelity unsuccessfully Cf. United States v. Broadcasting Storer sought the addition of five issues—distri- Co., (the 307(b) bution of services so-called L.Ed. The Commission also issue), service philosophy, programming, Fidelity found that presented had not a ascertainment, needs and anticompetitive showing Norwalk, prima facie conduct. We consider each of these rul- clearly community, one identified ings of the Commission in turn. “significantly independent Ange- of Los 307(b) Section Communica les from the economic and cultural Act, 307(b) (1970), tions 47 U.S.C. re § noting standpoint,” quires fair, provide F.C.C. “to effi proposed based its advertising revenues cient, equitable distribution” of tele Angeles on the entire Los market. Joint vision service communities Appendix at 159-60. There is no sound United States. contends that questioning this basis for factual deter Southland,” mination; “the which it describes as previously this court has af Orange County and the communities finding firmed suburb the south and east of Angeles, Los Joint slightly Angeles closer to Los than Nor- Appendix community is a without a separate community. walk was not television service but which deserves it Huntington C., Co. Broadcast v. F. C. 307(b). section under This is not techni U.S.App.D.C. cally issue, since if aff’g Co., Fideli Huntington ty right meeting then appellant, F.C.C. 563 See also St. Louis separately desig be programming issue Telecast, Inc., 22 F.C.C. by stating and nated it would only [program “to the extent allowed part petition, As of the same Fi ming go beyond ordinary differences] delity asked Commission to a add judgment differences in and show a su philosophy” “service issue. That con perior public devotion service.” 1 F.C. noted, cept, as we have is a term of art The C.2d at 397. Commission also made applicant’s to describe an used intention differences, that percentage clear even its programming only prima to direct regard highly with favored cate rily part to a of the area be covered gory programming, of local must be aby signal. station’s The Commission community based on ascertained needs in Fidelity directly found that fits into the justify order to a pro addition of mold in developed Petersburg Television gramming issue. Ibid. Corp., (1954)—thatapp 19 F.C.C. 451 ell Fidelity requested that the Commis surveyed only ant had three Los Ange- a programming sion add issue because les residents and could therefore be emphasis on programming its local and ignored found to have the actual city the “marked percent differences planning. license in its at 464— F.C.C. ages applicants which the propose to de 65, 475; Appendix see Joint at 160. The program categories.” vote to the various factually Commission’s decision is accu Appendix Joint at 205. The Commission rate, Appendix see Joint at grounds refused on two the pro —that the Petersburg based on standard Fideli gram differences were mere differences ty legitimately given could have been a judgment Fidelity and that not for “service philosophy.” demerit The adequate an survey justify done needs decision not to add the issue to the com the insertion of the issue on the basis parative hearing only was not harmless y.14 “superior public devotion service.” probably favorable to Fidelit Ibid, the agency’s at 161. If rejected only ground, had been based on the issue first additional Another questionable. Prior might Fidelity well programming. was the F.C.C. Statement, 1 F.C.C.2d offered 22% less Policy entertainment programming pro twice as much educational and (1965), proposed news and the compared gramming as RKO. Ibid. at was 205-06. competitors impor an These differences exceed those on which criterion formed ruling on this WPIX, Inc., an issue allowed ultimate determination was part of the tant Jaffe, on the license. See F.C.C.2d received who Li requested Broadcasting which Review Board was FCC The WHDH: Renewals, Chapman to reconsider in 82 Harv.L.Rev. Radio & Tele cense view, Co., agency’s (1967).15 vision In the How ever, as little the Commission also found that the paper battles resulted actually survey Fidelity the winner needs-ascertainment surance forecast; made, basically was limited to programming produce “Southland,” when an especially provide unfair did ade was deemed issue to run on quate who had basis on which to decide whether applicant, a challeng against appellant’s programming record, pitted differences his really related to any type the needs of the promise who could er (which favored. entire service area of course in gramming Angeles). put an cluded Los under Statement Ibid. by requiring position stood Commission’s practice end to indicates hearing examiner’s decision of Pro- 15. See F.C.C. Forms Service, against gram Proposed Birming- Operation, found would have that he Appendix 16761; Co., Broadcasting philosophy” Joint issue. Dkt # Alabama ham Television, “service 16760; Birmingham # Dkt 16758; Chapman Corp., Ra- Dkt # Television Co., Television Dkt # 15461. dio & programming depended issue basis, three Fidelity argues that therefore programming, factors—differences in ad produce adequate able to equate needs ascertainment subject. area Appellant’s record Brief license, covered and relation of background already at 19. The been the needs to the proposed programs. I, Borrowing on in supra. touched Part Appendix Joint In choosing to from the Department’s Justice suit orient surveys part one Tirе, against Fidelity charged General area, service Fidelity took RKO, the risk that through parent General it if did 307(b) not win on the issue, Tire, engaged had in the “reciprocity,” supra it did not—the Commission practice obtaining of sales condition- —as could find that it had inadequately ing sur purchases on future orders. The veyed the needs of its area. Knowing challenge KHJ, was in essence that be- this, Fidelity cannot now complain place cause of its in the General Tire lost it its bet.16 structure, automatically received adver- tising competing without with Los other attempt sepa a Fidelity’s to have Angeles proven, stations. If the anti- added re issue rate needs-ascertainment competitive on effect stations Commission discussion. quires little Reciprocity espe- would be obvious. cially complex is (and since provided have so provide rules conglomerate in a like 1963) enlargement of that a motion for General Tire because its needs prod- and days after be filed within must issues diverse; ucts example, for rubber for the of issues scheduled the notice purchases can be conditioned on advertis- Reg the Federal hearing published Fidelity that, ing argues sales. this for 1.229(b) (1973). The 47 C.F.R. § ister. reason, it necessary was to be able case in this Register notice Federal present to evidence on reciprocity in the Fed.Reg. on June published entire organization, General Tire not and the to file a (1966), so that time simply that “patently which was ger- Monday, out enlarge to ran on petition stewardship mane to RKO’s TV,” of KHJ— found The Review Board June required by hearing as examin- pe had not shown that Fidelity 17-20; er. Appellant’s Brief at see July could not have filed tition Appendix Joint at 182. time, Appendix Joint been filed appeal not Fidelity did charges, nature of Given the ruling to the Commission. Fi Board’s involve including allegation of direct having to its ad delity failed exhaust merely not General RKO and ment Tire, issue, on this remedies ministrative Complaint at United States see is not determination Review Board’s Co., supra, Tire Rubber v. General & Pine v. court. Cf. before this properly could well seems that 466, 467-68, States, United request to initial granted h’ave Ct.Cl. anticompéti- to enlarge the issues include Finally, up Fidelity’s request we take proved the error But tive conduct. relating have an issue to RKO’s anti- case reached By the time this harmless. competitive court, managed conduct hear- added to the to cre Fidelity this ing. While the eventually in this fairly substantial record ate a issue, an Appendix practices add such Joint reciprocity did proceeding on operation it acted rather RKO, late and on limited in its merely not Fidelity also maintains it was error for case that Alabama Television had done Chapman adequate survey the Commission to remand but had not shown how Television, Review Board to Inc., allow Alabama ascertained proposed needs matched the competitors case, Here, programming. one of in that the Commission found programming missing show that that requirements, primary differences were one proper survey, related to the needs ascertained. See 169 U.S. therefore 689-690, App.D.C. explanation pp. ---, pp. by Fidelity no could show supra. programming Chapman how The difference between met unknown needs. KHJ, throughout anticompetitive the entire broad- conduct.17 The na basic Furthermore, charge side of its business. ture of the procedural cast in- participated problems also more II, been discussed Part supra.' anti- tensive on General Tire’s Here we validity assess the competitive part determination, conduct the Commission’s I, Part proceeding. basis of the proceeding,18 WNAC record to disqualify grant supra. The renewal of RKO’s license demerit RKO because of the subject made trade expressly prac KHJ was relations tices of General Tire.19 the WNAC ultimate determination in anticompeti- A record on the case. full The antitrust reciprocity law on compiled, has thus been and it tive issue entirely practice settled. be available for will consideration successfully explicitly conditioning KHJ respect after supplies supplier’s pur orders for its final the status of makes decision on products buyer chase of from the license RKO’s based the outcome been held violation of at least proceeding. the WNAC 5 of the Section Federal Trade Commis Also, sion Act since the 1930’s.20 Ill opportunity practices for such which might arise a merger from can result in helpful It will be to consider merger’s constituting a Clayton Act separately one other matter before com 7 merger section violation.21 When no ing directly agency’s on involved, particular and in where it is comparison actual attempts clear that sales induce comparative RKO. Before a can through purchases successful, are held, at least the winner before controlling rule is less plain.22 license, it necessary can receive the Commission to determine that The largely evidence in this case citizenship, meets “the charac shows, opinion found, as the agency inef ter, financial, technical, other attempts reciprocity, particu at fective qualifications” prescribes. the F.C.C. larly respect Ap with to KHJ.23 Joint 308(b) (1970); Anthony, § See 47 U.S.C. best, pendix at 10-11. At there is doubt supra case, 3 at In note 34. there unilateral, whether unsuccessful at objection on was serious the character tempts reciprocity at constitute an anti alleged only it issue as related to RKO’s Kintner, trust violation. See The Anato Clay (Section 7 (1970) § 18 15 U.S.C. 21. filed also the Broadcast Bureau 17. RKO and C. v. (1914)); T. see F. Act, 731 Stat. character, 38 ton questioning petitions 592, 594— Corp., U.S. 380 Foods hearings Consolidated to conduct refused (1965). 95 L.Ed.2d 14 95, 85 S.Ct. Appendix allegations. 188- at Joint those Dy- 94. generally States General United 22. See (S.D.N.Y.1966). Corp., F.Supp. 36 258 namics bearing record on this of the WNAC The States, Ry. v. United Pacific Northern also See (if the determination is left for future issue problem (1958); 545 2 L.Ed.2d 78 S.Ct. U.S. 356 raised). should Enterprises, Steel States Inc. v. United Fortner L.Ed.2d 22 Corp., U.S. 394 non-comparative and a is both a 19. Character (1969). 495 While the Com- consideration. party entirely disqualify above, disagreement mission can 23. As indicated there character, poor it has also retained relating basis to General’s reci- evidence whether procity practices, as blemishes option character to use lesser or KHJ’s but not to RKO’s proceeding. them, in a demerits should have been admit- involvement Comparative Hear- if ail Tire think it clear that General ted. We ings, 399 except been divisions RKO had involved reciprocity, no sufficient basis there would be (Section Fed- 5 proceed- 45§ license 15 U.S.C. this broadcast for demerit ing. Act, 719 Stat. 38 practice corporate is rel- Trade the entire eral While Co., F.T.C. Waugh Equipment 15 evant, (1914)); role was that RKO’s see this record shows Corp., Packing F.T.C. substantially California than that of General’s' less divisions. Handler, years. Emerging recent See my Reciprocity, A.B.A.J. Reciprocity, Diversifi case, Antitrust Issues: Dynamics (1970). In the General Ventures, cation and Joint 49 Va.L.Rev. subject, expansive on so far the most (1963); Hausman, Reciprocal completed only successfully efforts were Laws, Dealing and the Antitrust determining court in considered (1964). Compare Harv.L.Rev. Kintner, Act been whether the lated, vio Sherman Anatomy Reciprocity, at We F.Supp. do not practice A.B.A.J. required go think that the F.C.C. affirmatively was not illegal declared particularly further than the courts— Dynamics case, until period General respect earlier with F.Supp. at general practice even there the law and merger might context today. than accounted were even less clear ruling.25 for the Tire has been General infra.24 since 1970 under a consent decree which There also instances record prevents engaging from in most sorts reciprocity. Most of of successful these reciprocal trade relations. In these RKO, have little to do with and even less circumstances, remembering KHJ, ratings times whose KHJ only part a small of what went that, push with the poor so even added on and that antitrust considerations are advertising was re- reciprocity, no segment one of the Commission’s 122-26, Appendix ceived. Joint 132- concern with the character of broad addition, was typical following 35. In cast applicant, we find that the F.C.C. reciprocity the coercive cases of the act arbitrarily, did not capriciously, or 1930s, appears reciprocity illegally refusing give RKO a dem in this shown tually record was considered mu- disqualify erit or to it for reciprocity both by companies, ‍‌​‌​‌​‌​​‌​​‌‌‌​‌​​‌‌‌​​​​​​‌​​‌​‌​​​​​​​​‌‌‌‌‌​‍beneficial and practices outlined in this record.26 although purchases might that in some response cases sales, be rerouted in reduced attempt

General did not to use IV as an

coercion inducement. Contemporary sources indicate We come now to our final task— type that reciprocity scrutiny of noncoercive of the F.C.C.’s ultimate decision widespread extremely early in the in the light of the standards compar for 1960s, writings suggest but more recent ative hearings renewal developed by the largely agency that it has been abandoned in past.27 in the reviewing In petitive may practices subject 24. While it is that clear the F.C.C. take reopening in the light anticompetitive account actions short of an- proceedings (which WNAC have violations, yet Broadcasting finally titrust not National Co. v. been by dеtermined the Com- States, 190, 223, mission). United 319 U.S. certainly (1943), 87 L.Ed. 1344 it is not clear required, present purposes, 27. We are not for that, conviction, in the of an absence actual it to deal with criticisms leveled recent disqualify downgrade must or on such a basis. years against comparative hearing process, presence statutory provision of a which especially applicants. as it involves renewal explicitly grants option requiring a court the See, 3; g., Anthony, supra Goldin, e. note revocation of a for an license conviction “Spare the Golden Goose” — The Aftermath of suggests antitrust violation that the Commis- Policy, 83 WHDH in FCC License Renewal option sion retains to do less when no (1970); Friendly, Harv.L.Rev. The Feder 313(a) conviction is involved. See 47 § U.S.C. Agencies: al Administrative The Need for Bet Standards, ter Definition of 75 Harv.L.Rev. addition, reading Dy- Grunewald, In (1962); a strict Compara of General Should the would Hearing namics be that all discussion of reci- tive Process be Retained in Television procity as a Licensing?, Sherman Act violation dictum 13 Am.U.L.Rev. 164 Com ment, since the court found that an Broadcasting insubstantial vol- The FCC and License Re WHDH, Perspectives ume of commerce been affected. newals: 36 U.Chi.L. F.Supp. at 66-67. Rev. 854 Comparative stressed, The 1965 Statement on 26. As we have under the Commis- Hearings, agency’s ruling 1 F.C.C.2d 393 sion’s on anticom- that decision, so-called particularly comparative traditional F.C.C.’s under largely predictors factors are of the kind given agency mandate that broad —that of service a new grant applicant “if public it shall license conve offer nience, interest, requirements and necessity being good or will licensee.33 It is not our thereby,” 307(a) ap 47 U.S.C. function to § served is, prove or disapprove as has (1970) function often been framework if it — our falls, does, It is within the repeated, necessary agency’s limited one. au thority. satisfy before,34 that we ourselves As we have said and as the agency oversight acted F.C.C.’s within bounds of its committees Congress recently statutory reiterated,35 authority,28 constitutional comparative procedural hearing process it has its own might followed well regulations,29 come closer producing much findings rules licensees who act public in the reasonably interest if stand of fact articulated ards of “substantial service” program based on substantial evidence ming whole,30 and other areas were developed as a ei record conclusions ther directly the FCC greatly past pro through not deviate from do stricter rules for explanat without sufficient ascertainment of com nouncements munity needs, ion,31 and if general engaged it has licensees were re quired decision-making.32 to follow them or in reasoned run the risk of non-renewal.36 But we reiterate The two basic features judicial job is not our to direct the Com present system as the Commission has mission on how to run comparative developed it are that a renewal applicant hearing process, beyond assuring that judged will be past record, on his process administrative respects criteria, most C., sets out 30. Colorado Interstate Gаs Co. v. F. P. hearings, its own terms “does U.S. (1945); 65 S.Ct. 89 L.Ed. 1206 attempt differ with the somewhat B., to deal Universal Camera v. N. L. R. con problems 474, 487-88, where raised ent 95 L.Ed. seeking of license.” testing licensee While the F.C.C. n.1. id. at 393 Ib Broadcasting System, 31. Columbia v. F. Inc. C. was issued statement after the 1965 soon held C., govern the introduc would the statement (1971). pro evidence in renewal tion of generally 32. See Greater Boston Television Productions, Inc., ceeding, (7) League 1 Seven C., Corp. 383, U.S.App.D.C. v. F. C. 143 444 1597, (1965), until it was not 1598-99 F.C.C.2d 841, (1970), denied, F.2d 923, 850-53 cert. 403 U.S. attempted deline the 1970 2229, (1971). 29 L.Ed.2d 701 apply would explicitly the standards ate Policy proceeding. comparative renewal in a 1131, Corp., 33. See H. Belo 40 A. F.C.C.2d Comparative Hearings Concerning Statement (1973); Corp., 1133 Moline Television 31 F.C. Regular Applicants, Involving 22 F.C. Renewal (1971). C.2d Statement, Policy (1970). The 1970 424 C.2d challengers however, deny operated a full C., 34. F. Citizens Communications Center v. C. by hearing, it was vacated 32, 1201, U.S.App.D.C. F.2d 145 447 1213 n.35 contrary the Communications as court (1971); see to Save Citizens Committee Citizens the doctrine. Ashbacker Act 185, C., 206- WEFM v. F. 207, 165 C. C., 145 U.S. v. F. C. Center Communications App.D.C. 246, (1974). F.2d 506 1201, (1971). The 1214 447 F.2d Act, H.Rep.No. 35. Broadcast License Renewal develop thereupon undertook 93-961, Cong., 2d 93d Sess. 16-17 applicants, for set standards new Act, S.Rep.No.93- License Renewal Relating to the Broad of Policies Formulation Cong., (1974). 2d 93d Sess. Stemming Applicant, from the cast Renewal Comparative Compara- Concerning 36. See Process, Hearing Involving Regular Ap- Hearings tive Renewal yet inquiry (1971), not resulted 'but this plicants, policy statement. a new hearing expressed in this the examiner case C., Broadcasting F. v. C. Co. Johnston if standards had available belief been Appendix met them. RKO would have Joint Dulles, v. Service at 152. 1 L.Ed.2d S.Ct. public competitors large the and of the bulk rights of were inoffensive. Act addition, under Communications Ibid. at In assured RKO did doctrine, it and that present, Ashbacker at a expenditure and the substantial fac money, decisions based on produces rational some other entertainment grams known advance. generally Angeles which enriched the tors Los television scene. Ibid. at 60-61. In the Com first We consider where category non-entertainment RKO finding perform RKO’s mission’s promised had not much,39 showing as “poor” not “average” and ance was similarly was mixed. coverage, News If hearing examiner had found.37 example, even for the 1962-65 era of poor, then performance was news, 15-minute national was overa standards, own Commission’s bundant, but on the other hand the sta running.38 been almost out present did tion a certain amount of cov im While examiner’s decision is an Angeles erage of Los City Council hear part of the record before this portant Ibid, ings. at 64-65. On an absolute court, where he is over particularly basis, might us, be difficult for all of ac an inference from facts turned on if we were regulators, to characterize Commission, “it cepted by past performance KHJ’s “superior,” function, Examiner’s, agency’s entitling it plus major to “a signific decision, . ultimate make . . ance,”40 judges but as agreed we are there and where is substantial evidence cannot, we on the record as a supporting agency’s each result is the whole, say that the Commission’s deci governs.” Greаter Boston choice that that programming sion performance was C., U.S.App. Television F. C. “average” is bereft of support D.C. substantial evidence. 923, 91 U.S. Having program- decided that RKO’s (1971). The L.Ed.2d 701 record shows performance ming only “average,” programming during the li that KHJ’s go the Commission had to to the oth- largely period cense oriented criteria, comparing er traditional Fideli- films, showing usually of feature inter predicted ty’s achieving success rupted a substantial number of com goals integration, ownership, local Appendix mercials. Joint at 72-81. On diversification with actual per- RKO’s hand, record also shows formance in those areas. was the licensee that RKO first country above, to obtain a substantial li As we film noted the examin er, brary Commission, to make these availa not the gave movies Fideli ty integration a demerit proposal. ble to the television audience. Ibid. agency’s engendered some sub The reversal of the 51. While films ex violence, point apparent excessive on this stantial criticism for aminer was more real, many “claim since felt the propos- of the movies excellence” than both top 37. stations country It was not in until its 1970 the in terms of the percentage the it of day Commission made clear the spent broadcast on news, public affairs, performance during peri- licensee’s the license and local programming. od, any F.C.C. upgrade 31512, and not News effort made to Release 8, the No. Oct. 1974 at 118, challenge filed, 220. station after was would be taken into account on renewal. 22 F.C.C.2d at 38. 22 F.C.C.2d at 428 n.4. practice 427. This overruled the of consider- 39. There promise is no issue of per- ing post-term versus changes later formance in this case as there was in hearing. Radio, Moline See Hearst 15 F.C.C. Corp., Television (1971). F.C.C.2d 263 (1951). As hearing the found, examiner perform- RKO’s is, however, inappropriate compare It to promises ance matched its exactly. almost pre-1967 performance KHJ’s with 1971 stand- Appendix Joint at 58-59. ards, as one of the dissenters did in this case. 40. Citizens Appendix fact, Communications C., Joint at Center v. 38. In F. KHJ’s recent C. U.S.App.D.C. 32, performance program- non-entertainment (1971). ming placed among can said to be have it efforts to formal al, all the Commis- more paper also shows while record needs, well as wanted, community extremely had sion could ascertain in KHJ’s these efforts being implemented. of chance of results little Ibid, we 150-51, The Appendix 18-20. While at 57 — 58.41 gramming. Joint per presumably interest decision was local say examiner’s that RKO’s cannot Fidelity’s Fidelity’s of than based on his observation better formance basis of dis- opportunity and on his to be predicted witnesses could we proposal, integration of owners challenger’s cern the character Com pre- ability perform. their This is overrule properly cannot also worse. of was no cisely type finding examiner’s decision mission’s by given weight the most which must at 20-21. Ibid. ulti- agency, and the Commission’s respect With diversification, ef- point, which in mate decision on apparent on this record that Fidelity hearing ex- agreed with of fect far fewer media interests than did aminer, can on the record stand RKO42 and that if diversification hearing examiner created. See Univer- quantitative form were the of basis com B., v. N. L. R. 340 U.S. Corp. sal Camera parison, Fidelity should pre have been 95 L.Ed. point. ferred Joint Appendix at However, in a renewal hearing, or behalf, On the Commis in a RKO’s standard hearing where that, through company’s found one is the sion licensee of other sta tions, tb,e management “requires which policy the Commission has on occasion in a involve themselves of stations to considered whether the licensee has in or range community past civic goals wide of met the of diversification by the information ganizations operating and to use his stations autonomously help contacts to deter gained independently. from such See McClatchy of programming Co., direction and Broadcasting mine the 19 F.C.C. station,” ac management had But cf. RKO’s Chronicle Broadcasting Co., in local af quired the kind of interest 123 n.9 (1969). In addition, responsive the station fairs made the number of other outlets for goal ultimate community diverse views in the market impor is an —the ente- integration ownership and local tant consideration in weighing the need The Appendix organization Joint at 20. examin new rrar" to receive the supervis KHJ’s decision shows that license. er’s See Greater Boston Television residents, long-time C., ing personnel F. C. 143 U.S.App.D.C. 383, natives, including Angeles Los variety wide area, active in a and were 29 L.Ed.2d locally na (1971); City associations both Camden, civic tionally. Appendix at 55-56. (1969). Here, Joint n.22 both the Reg. 2d Applicants, “the Radio P F found that 13 & examiner cast 41. While Fidelity enjoys' preference that solid most proposal is backed that its from the fact stems ownership opinion agency’s used the public opin- comprehensive sampling of by a Fidelity-S of a stockholders minor one entirely ion,” sample almost was oriented Angeles Los interest suburban substantial Southland,” the ex- found and was “the Fidelity’s rating on di- newspapers diminish city Los contribute “to further aminer Angeles’ Appendix Joint versification. doughnut becoming the hole however, newspapers contends, were Appendix surrounding Joint communities. its throwaways advertising cannot which mere Furthermore, provided affidavits 149. at Reply Appellant’s media interests. considered pro- its support its claim by to charges on This one of at is Brief 37. community-induced were of gramming was held; not have it should no -which you like it” varié- our schedule—-don’t “here’s by The er- all the Commission. at been used unac- considers now ty the Commission which view, and, however, did rorj in our was minor 208-12; As- Appendix see outcome, at ceptable. Joint significantly affect or control by Community Broad- Needs certainment Commission and the examiner found took the view that service is “minimal operated KHJ was independently preferred of con no service at all.” Com trol from the national pare Act, office of or Broadcast License Renewal RKO Tire, General except in broad policy H.Rep.No.93-961, Cong., are 93d 2d Sess. as. Appendix Joint at 57. While the There is no need expand here to examiner’s report shows some headquar expectаncies.” on “renewal We are not ters supervision, particularly in making faced with a situation superior where a sure that local stations live up to their is denied a license because to promises to F.C.C., 52-53, give ibid. at it to him would work a “forfeiture” is there nowhere near enough of his opponent’s evidence investment. We mere in the record for us to require ly the Com confirm what we intimated in the mission to come to any other Corporation Greater Boston conclusion Television . on station autonomy. that, There is also when sub faced with a fairly and case— evenly stantial evidence to support record, the Commis balanced findings sion’s that there may, is op sufficient basis the renewal appli portunity present past performance, diverse cant’s views award him the through the area’s 126 stations, radio license. 444 F.2d at commercial television stations43 and 350 It emphasizing special worth newspapers, including general two circu posture of particular case. It lation dailies. Though the Commission based on record built under standards has vacillated over the years in gen upgraded have since been or modi approach eral to diversification, its de fied or reconsidered the Commission. termination in this case was not in direct community New ascertainment criteria conflict any rule or policy as have been issued and there is now a prior enunciated in decisions, and we requirement something of a continu cannot say that the approach here was ing dialog between station au and its an unreasonable or unlawful application agency dience. The has also undertaken of the existing diversification principles rule-making process on cross-owner to this renewal case. ship. development, through rule- making, of standards of per “substantial say On the whole it fair formance” also seems imminent ulti Commission found that the that the prove helpful. should only We hold here analysis of its of the record effect mate that under the former criteria the Com were essen was that and RKO mission, poor when faced with a chal the, or, tially equally poor contenders — lenger who offers little more and is like best, minimally acceptable ap both ly in fact to provide somewhat less than agency was plicants. While the under incumbent, did not commit reversible give obligation to to either no license by awarding error the license the inc say we competitor, cannot it com umbent.44 when, legal error in its mitted attitude case, Affirmed.45 pertinent the times as of explicit grant short licenses made 43. The Commission’s decision states that there Amendments, now assigned 1960 Communications Act 15 commercial television stations 307(d) (1970), Angeles and the Appendix § codified at U.S.C. to the Los Market. Joint granted par However, agency in fact short licenses 12 commercial stations are ticularly parte Factbook, currently ex communications operating. where 44 Television questions have raised about other conduct at 70-b. potential or where the suc licensee’s character Judges, join Leventhal and Davis only by default. has succeeded cessful licensee court’s affirmance of the Commission for the Television v. F. C. Greater Boston See C., given, note, speaking reasons but wish to themselves, the Commission could have granting considered the alternatives of short or conditional license rather than limit ing itself to a choice nonrenewal or a full three-year authority license. The FCC’s

703 so, Having deny done we the REHEARING, petitions FOR PETITIONS ON rehearing and for reconsideration. OR CLARIFICA- RECONSIDERATION FOR SUGGESTIONS AND opinion Our affirmed the TION Federal EN BANC Communication Commission’s decision to REHEARING renew the license of intervenor RKO ROBB, and Cir LEVENTHAL Before General, Inc. for station KHJ —TV in Los *, Judge, United DAVIS Judges, and cuit Angeles rather than awarding the of Claims. Court States challenger Fidelity license to Television, Inc. decision way in no approves a partial return to the comparative hear- CURIAM: PER ing procedure of the 1970 Policy State- Television, a pe- has filed Inc. Concerning ment Comparative Hearings 6, of our reconsideration March for tition Involving Regular Renewal Applicants, Also, the this case. Citi- 424 (1970), procedure (CCC), a Center Communications zens we vacated Citizens Communications supporting divers- organization nonprofit C., Center v. F. U.S.App.D.C. C. leave to for broadcasting, has asked ity (1971). F.2d 1201 The Commission in sup- a petition curiae amicus as file held, must, here as it a full comparative of our rehearing or clarification port hearing under the peti- submitted such decision, has Comparative Broadcast Hearings, 1 not ask to that CCC did regret We tion. (1965). F.C.C.2d 393 “spur to com- case at earlier participate petition” of that procedure pre- was has noted As intervenor time. here, served and in fact reaffirmed when the petition, CCC’s Cen- to opposition KHJ, the Commission required upon a what really with concern ter’s finding that its service not been su- court Commission, than the said rather perior, to run the gamut of comparison did, arguments now on the traditional compara- cogently been made could makes tive of integration factors and diversifi- however, have, decided to We earlier. cation. filed, petition to Center’s allow reemphasize opportunity us the give U.S.App.D.C. What we decided 169 opinion. previous scope of limited pages ---, 515 F.2d needed, 29 L.Ed.2d South treating Florida a basis as for licensee as a C., Corp. v. F. C. Television up when license new comes (1965), 349 F.2d renewal. See Greater Boston Television C., supra U.S. L.Ed.2d F. 444 F.2d at v. C. point, suggested authority though also The Commission Since from the licenses, grant argument, 303(r) conditional 47 U.S.C. bench at oral was not § raised before Commission, past granted presented and has in the nor even this court in one-year license, papers, fairly appeal conditional see before us Office of point, Communication United States decision at this time. We note the ever, Church of how- C., F. possibility v. Christ C. avoid the our affirm- precluding F.2d 994 While in that case this be taken court ance will as such a more disapproved grant disposition license to limited when the FCC WLBT comes to that, impact court did state proceeding. where the consider the licensee of WNAC signs being willing up showed conditions, to live affirmance, already (see 45. Our observed such a limitation the license appurtenant notes thereto, the text completely proper. Id. at 1008 n.28. III, text at the end of Part Particularly qualified competitor where supra), (as conditional the Commis- brings a licensee’s weaknesses to the FCC’s decision) sion’s on the ultimate outcome of the attention, public might interest better proceedings. Fidelity Television, See WNAC considering served the Commission’s C., U.S.App.D.C. 441, 449-50, Inc. F. C. whether short or conditional license would induce licensee to correct the weakness- going programming es —here and to both * Sitting by designation pursuant to 28 U.S.C. Golden, supra character. note 26 at 1026- 293(a) (1970). § addition, serve, such a In license could if that shrugged tions should not be 702) off. page proponents honestly the Either believe permissibly determine after could such a operation station, of a television un comparative hearing (a) full “Fideli enterprise, any can be like effec essentially and RKO ty equally were inexperienced an or, best, tively directed poor both contenders — basis, group part-time they on a or ad minimally acceptable applicants”, proposal for purposes vance show (b) though in this agency situation the only without intention to might rejected effectuate it. well have both the exist very palatable. inference is ing challenger, Neither po licensee and the suggests put former witlessness. The latter sition before the Commis was. questions advisability as to the in raises sion and those circumstances we can stewardship entrusting to those overturn its to who decision follow to a theory attempt licensing fob off on that “minimal service is to be all”; a tale.” (c) agency such tall That to no preferred service at since challenger made, type of this case was concerns. a choice to between two competitors plane, equal on an it could Moreover, we stated several in times light licensee; properly existing opinion that our review the Com- (d) the and issue whether the license which, to manner in mission looked or could should have been renewed con any not 1975 date or in the ditionally or a period for shorter-than- future, agency applied its then exist- us, normal not before not having ing policy to and rules the case at hand. been raised below or here. time, Commission, by At that rule by decision, consistently distin- pointed we out in the opinion As (169 -, -, U.S.App.D.C. pages guished, making assessments under criterion, 703), Fidelity pages did not the diversification show between sit- superior a itself preferable multiple in which a uations licensee poor but rather “a challenger to a wished obtain new station those who offers little more and is likely organization applying in which fact to vide somewhat preexisting less than the a renewal of license. On incumbent.” general subject hand, On the Commission’s deci- the other ex aminer said: prior “Once it case clears sion in this was rendered the easy (for it) hurdles —local promulgation newspaper the 1975 ownership, radio rules, public diversification оpinion cross-ownership Report Second —Fidel ity Order, does not look too good. Docket No. F.C.C. 75-104 Attached to qualifications (Jan. experience 1975). adopt ¶ no These rules field of broadcasting, ap- no a structural rather than functional contributions to art, proof no through proach as diversification even to exist- school of experience of licensee ing entity licenses under which an answerability which stewardship, proof, not, no through newspaper may owns some same school, ability cases, structurally stand specified retain shock of adverse conditions, financial broadcast license. We made and and no make dem onstrated ability whether, to conceive no under such present ap- programs of high quality proach, possible it would be allow [footnote omit In the same connection, multiple ted].” entity retain licenses. We the ex aminer severely that, criticized the as of applicant’s decided FCC integration proposals, placed applied contemporaneous diversifica- inex perienced stockholders, which, policy appli- tion working part- time, supervisory cants, encompassed roles. He consideration said: “If Fidelity is separation activities, serious about its functional proposal, in a it is projecting an operation essentially will, manner which was best, consistent signalized prior by confusion, and, law. at worst * * * by chaos. Proposals such as When the smoke away, clears we this are susceptible interpreta of two are left with distinct impression “nothing” applicant, who we have requiring of the Commission that it ad a novel construct of a offered here to the rule of law in its compara philosophy; who has service tive and other discretionary Southland decisions.1 that the exam integration philosophy an The decision here adopts the form of this being correctly derided as either iner more recent approach assuming a basi — insincere; who or has shown cally depth inquiry “witless” into the Commis aspects in certain candor 1—and naked, process but, lack of sion’s think, I decision— rather before FCC who comes not the substance. In our earlier ap even so I am better naked saying proach, we took the view that the com incumbent, because he lacks di parative than decision essentially was political And what we answer law; versification. that, and not bound the rule of time, criteria at the FCC least that could be approach said for this applying in violation of law in a was attempt was that did not to justify in criterion that held that diversification rational terms the helter-skelter so often operation of stations RKO’s autonomous present in comparative decisions. The independently objectives met the ly opinion in court’s this case unfortunately sufficiently competition to withstand may justification be seen as a rational “nothing” competitor.2 of a essentially an for un-rational decision. Moreover, the central issue of the appli rehearing and recon- petitions Thе cability of the rule of law highly dis denied. sideration cretionary decisions is not sufficiently BAZELON, Judge, regard delineated and our choices in Chief rehearing this issue are therefore less grant en voted to informed to why he toas extent. banc: day, this court tended to earlier In an of this purpose statement is to licensing decisions these matters in the affirm discuss course of inquiry limited into the most demonstrating the manner in which the with decision-making. If the process failed to follow the rule Commission operative' the factors project denominated in this case. This involves FCC of law with some reasonable pol decisions of the administrative a consideration not intervene court would clarity, judicial decisions which the icies and review decision under ignored or misapplied if either even Commission policy, organization in terms of the illogical its decision. past of the with decisions First I is as follows. indicate statement conflicted fairly rea otherwise was in which the Commission has agency the manner standards. illegal expectancy from established renewal granted out soned has, ap General, Inc., court years compara one In recent RKO me, away from this moved in contravention of our participants, tive peared stance, demanding more into a in Citizens Communication Cen posture presented 33, applicant least para. one stated that there In case, timely “repeated much-discussed WHDH see Greater failure to make Bos- awas FCC, Corp. infra, developments U.S.App.D.C. ton TV necessary reports v. of new affect practice 444 F.2d at 863. proposal.” ing It noted that “this after its attention was directed even continued FCC, 1. See Greater Boston Television v. keep its house in order.” It need U.S.App.D.C. 444 F.2d “we believe that the record here concluded (1970), denied, cert. 403 U.S. effectively promise gives will little (1971); Radio, 29 L.Ed.2d 701 WAIT Inc. paper integration promises implement FCC, U.S.App.D.C. 317, 418 F.2d 1153 19-20). (JA . .” . . subsequent appeal, U.S.App. ruling this was not a Even as of D.C. sion, 459 F.2d 1203 Star Televi newcomers. Even a newcomer all excluded FCC, Inc. v. presentation expe- built on the can make TV 1086, 1089, F.2d key one or two stockholders of at least rience (1969) (Leventhal, J., L.Ed.2d reasonably management, on a identified dissenting). Compare note 87 infra. practicable approach, the kind bona fide A. the Permissible ter v. CCC Extent Expectancies (A) Renewal This entails a con sideration of manner in which the explains, General, As the court RKO performance renewal past Inc., wholly subsidiary owned may be considered under the CCC deci Company, General Tire and Rubber argument and an sion this consider TV, until 1965 the licensee of KHJ — expect no entitles RKO to renewal ation Angeles. August Channel 9 in Los On (169 U.S.App.D.C. pages ---, ancy application filed an (B) 706-710); a discus pages of its license for KHJ —TV. On (cid:127) process the subliminal the Com sion of 25, 1965, Fidelity Television, October a comparative used to de mission avoid Inc., mutually applica filed exclusive grant illegal and to an cision renewal permit operate tion for a construction expectancy (169 U.S.App.D.C. pages appliсations 9. The two Channel ---, pages F.2d 713); 710 — comparative hearing. down for a set argument (C) an years There four of litiga then ensued precedent failed to follow its own attempts over enlarge tion ruling on the diversification of owner comparative be the issues to heard in the ship comparative (169 factor U.S.App.D.C.hearing. litigation result of this pages ---, F.2d criticized in Part II. described and On 717); (D) pages a review of a 713 — Hearing August Examiner passel of related errors which taken to Fidelity’s application recommended gether strongly indicate that the Com granted be application that RKO’s mission nullified hear years delay be denied. Two further of (169 ing pages process U.S.App.D.C. pondered ensued as the Commission ---, pages F.2d reopen whether record at the com Second, 717-721). I suggest parative hearing to take further evi that the improperly Commission denied a anti-competitive dence violations hearing specialized on a programming is Having against General Tire. decided by Fidelity sue raised Television, Inc., action,2 this course the other comparative participant, on ex delayed then decision for two further tremely grounds technical and in contra court, years. prodding After from this vention our recent in Citizens finally issued its decision Committee to Save WEFM v. year almost another after that.3 This -, F.2d 252 accept Hearing decision declined banc). (en (A) This involves a considera recommendation Examiner’s and instead grounds of the upon tion which the application granted RKO’s renewal gramming issue rejec was denied and a Fidelity’s application.4 denied The vote tion thereof (169 U.S.App.D.C. in the Commission was with the de 3— pages ---, 515 ciding being vote cast Chairman 725); pages (B) a review of 721 — Burch who concurred in the result of the First Amendment issues implicated by majority only opinion and not the issued. consideration past and proposed pro gramming hearings (169 Accepting the moment the scope of U.S.App.D.C. pages -, -, 515 F.2d held and propriety of the pages 725-726). treatment Commission’s of the standard Illegal comparative issues, Granted the ratio General Was 1. RKO decidendi Preference Commission was this:5 Renewal (1973). Inc., General, F.C.C.2d General, RKO (emphasis added). Id. history delay extraordinary in this 3. The Television, Inc. v. is discussed case FCC, best, [ap- of these at the both our consideration were minimally From ac point, ceptable applicants. we have up to this . plications] . . [We] com applicant say each is basi- cannot [the established cally qualified Commission] licensee, legal when, to be a mitted error in its attitude [applications] pertinent the times as of case, the characteristics respects, certain it took the view that ‘minimal differ service that. provides preferred those differences is to to no service none of at all.’ making Compare a choice between the License basis Renewal Act, proceeding. H.Rep.No.93-961, applicants in 93d Cong., two 2d made, a selection must be There Sess. is no Nonetheless need here aspects expand look to other expectancies.’ we shall ‘renewal and so affecting public in- are not faced the record We with a situation connection, superior we In this believe where a terest. is denied a recognition given must give license because to it to him would expectancies ordinary of an rights opponent’s work ‘forfeiture’ of his applicant. merely We investment. confirm what we intimated in Boston [Greater Tele light of RKO’s substantial in- [In Corp. v. 143 U.S.App.D.C. vision 383, in the station to make the vestment 841, 854, 444 F.2d light viable and of the re- Channel U.S. RKO], expectancies of we newal be- (1971)] that, L.Ed.2d when faced interest, — public that there is lieve fairly evenly with a balanced Angeles area and the Los both record, the may, Commission on the large, insuring pre- nation at applicant’s of the renewal basis past dictability stability of broadcast performance, award him the license. security If there is no such service. seeking facilities applicants with The court does not inform us from providing good quote intention of service comes the whence “minimal serv- public, development preferred the overall is to be to no ice service at industry surely of the will does and motivation all.” It not come from the persuaded opinion. . . . are suffer. Commission’s The [We] Commission given compar- credit must be in a to the value of that referred “continuation of proceeding, when existing renewal service” and not to ative the value of equal, are otherwise for the service over applicants minimal no service at all. public in the continuation value to And indeed it had no other choice since existing . . . petition service. here not a we confront [Since] record is clear that deny value of minimal serv- —where it will demonstrated in fact no service at ice over all is certainly RKO, than comparative a better service we’ rather a provide relevant —but hear- convinced, ing the reasons set the issue is not are the existence —where above, appli- that RKO’s renewal but rather who provide forth of service shall preferred. Why . . . must be the court cation it. finds no need to “ex- renewal pand upon expectancies” is not Initially, appears that the court mis me, all clear since I read the Com- this rationale for decision. apprehends basing mission as its decision squarely on may compare wish reader The expectancies. quotation following foregoing opin it in the court’s representation suggests The court the Commis- ion: sion’s decision was based on a rule that say whole it is fair among equal applicants, the On the renewal ap- the ulti found plicant may preferred Commission on the basis analysis “past performance.” of its First, effect mate the court’s Fidelity and RKO point was that about the record non-superiority of Fideli- or, essentially poor ty’s application entirely contenders— circular since (emphasis -, -, pages added). pages 6. 169 issue can be determined persuaded [We] there are suf- making comparative good evaluation. But points ficient to offset the less decision, quoted as the aspects the Commission’s favorable per- KHJ —TV’s shows, compara- excerpt did not make a that, formance and balance, largely it chose decision since tive record must be deemed to be within expectancies.” “renewal In oth- basis the bounds of average performance words, Fidelity’s application was not expected licensees, er of all thus warrant- simply because the Commis- “superior” ing preference neither a nor a demerit. never decided whether was! As sion opinion, Earlier in its the court expressly pages in more detail on is discussed Indeed, holding.8 affirms both the -, -, pages and the court had to labor infra, use of the renewal pages valiantly, purpose for what I do not clearly expectancies, upon by relied know, to overturn the Examiner’s find Commission, completely short-circuits the ing that RKO deserves demerit for its process. Hence, comparative evaluation past performance.9 Commission’s the Commission did not choose between purely based renewal ex “equal” applicants very since the notion pectancies, on value of “continuation requires of a choice that one existing service.” equal” be “more than others. The issue thus delineated is whether question why is that applicant may use the value of question, To that better. Commis- service”, existing quite “continuation only answer is “renewal expectan- sion’s existing of that quality from the apart cies.” service, as a factor re not, re Second, did hearings. Initial reference newal not, on statutory provisions award renewal to RKO peat did relevant would indi past performance. of legally basis RKO’s cate factor is excerpt However, quoted early should previously irrelevant.10 proof If further point practice grant basically clear. was to insuper a make needed, following quote advantage additional to the incumbent able 7 performance.11 Thus, it: provide past of basis ad should 301; 123, 304; General, 307(d); 47 §§ 10. See U.S.C. 44 133 7. F.C.C.2d RKO (1970), 309(h)(1) quoted Presumably, had in discussed if the Commission Citi decision, FCC, past comparative v. RKO’s zens Communications Center made a 145 fact U.S. 32, 1201, weight App.D.C. 447 F.2d would be entitled to some 1209 n.23 record Fidelity’s advantages. comparison with Hyde, Relating FCC and Procedures to Hearings Applications On Broadcast in Which -, -, U.S.App.D.C. pages 8. 169 515 F.2d Applicant Displace New Seeks to A a Licensee - 699, U.S.App.D.C. pages At Renewal, Seeking 1975 Duke L.J. 700, page -, 515 the court makes F.2d at 253, 256-61. See also Citizens Communica opaque past per rather statement that RKO’s FCC, U.S.App.D.C. 32, v. tions Center 145 447 integra formance as a of licensee areas 1201, (1971); 1207-08 F.2d Greater Boston tion, ownership and local diversification as well FCC, Corp. U.S.App.D.C. v. 143 Television past programming performance as are to be 841, 383, denied, 444 F.2d cert. part applicant’s considered as of renewal 923, 2229, U.S. 91 S.Ct. 403 29 L.Ed.2d 701 past performance. This statement confus WOKO, (1971); FCC, U.S.App.D.C. Inc. v. course, ing. applicant’s propos the renewal Of 623, 629-30, 153 F.2d rev’d on other al, applicant’s proposal, as well as a new will grounds, 329 U.S. 67 S.Ct. 91 L.Ed. compared be scrutinized the above- (1946). Compare these statements with But mentioned factors. such factors have no Station, v. Sanders FCC Bros. Radio 309 U.S. regard expectancy significance a renewal to 470, 475, (1940); 84 L.Ed. 869 And, by past performance. engendered of FCC, U.S.App.D.C. v. Crowder course, “past performance” RKO’s on those F.2d dreary indeed. factors (1968); 21 L.Ed.2d 375 Transconti General, Inc., 130- FCC, nental Television U.S.App. -, pages (1973); D.C. 308 F.2d Ameri pages -, 699-700. Broadcasting FCC, can Co. v. by the to expectancies confirmed of incumbent licensees practice, al ministrative comparative must hearing consideration courts, that some shortcircuit was renewal ex incumbency or given be dicta, the CCC particularly In famous not became question pectancies. proper of court defined the consideration be expectancies renewal whether expectancies:14 renewal proper con was but what recognized expectancies. course, dispute, We not renewal do sideration judged incumbent licensees should provided framework for This court primarily past per- on their records analysis of that in Citizens Commu issue formance. past perform- Insubstantial U.S.App. Center v. nications preclude ance should renewal of a There we D.C. time, At license. ... the same policy considered of re plus performance be a superior should comparative fusing qualifi to assess the major significance pro- in renewal competing applicants re cations ceedings. recognizes The court hearings newal until after the Commis public itself will suffer if incum- had whether the incum sion determined bent reasonably licensees ex- cannot had performed bent licensee “substantial pect renewal when they have rendered performed If the service.” licensee superior service. service, granted then was such The statement comparative reflected administrative without consideration of least, practice (or, at If the stated administra per factors. form, did so licensee practice) tive and was quickly adopted hearing a full comparative by the rejected Commission after the decis policy held.12 We incon CCC ion.15 This form of expectan “renewal statutory sistent caselaw cy” easily fitted into the requirement doctrinal full hear framework established in CCC. A licen ing qualifications on the of competing past performance see’s clearly holding This indic applications. pure was not potential ative of as a ly right licensee and compara a full thus formal: must given comparative weight right tive involved against challenger’s advantages present application a competing posed programming, ascertainment ef also duty the Commission make forts, diversification or whatever. The basis of a proper weight given past per to be competing applicat examination is, course, formance a matter for thus case establishes ions.13 CCC judgment. Commission’s may use not renew 492, 298, (1951), quoting denied, (1971), Ash F.2d 191 444 & n.1 mandamus Citizens v, FCC, 327, Corp. FCC, U.S.App. U.S. 331- Radio v. 326 ‍‌​‌​‌​‌​​‌​​‌‌‌​‌​​‌‌‌​​​​​​‌​​‌​‌​​​​​​​​‌‌‌‌‌​‍backer Communications 149 Center 148, (1945); 32, 419, (1972) referencing v. 90 L.Ed. 108 FCC 66 S.Ct. F.2d For D.C. 463 822 134, Co., Broadcasting 137- Relating Pottsville 38, Broadcast mulation of Policies to the 437, (1940); 580, L. B. Applicant, 84 656 L.Ed. 27 Renewal F.C.C.2d 582 60 176, Wilson, FCC, U.S.App.D.C. Involving Regular 170 Inc. v. 83 793, (1949). 424, Applicants, 798 & n.5 F.2d 22 425 Renewal F.C.C.2d & (1970). Broadcasting n.1 See also A. H. Belo Corp., (1973), 1131 further 40 F.C.C.2d on Comparative Concerning Policy Statement ceedings, (1974); Tele 47 F.C.C.2d 540 Moline Appli Involving Regular Renewal Hearings Corp., (1971). vision 31 F.C.C.2d 263 denied, 424, 24 F.C. cants, recon. 22 expectancy sup This of renewal kind 383 C.2d ported by of this the various statements court FCC, v. Center Communications 13. Citizens See, g., Televi e. Greater Boston issue. 1212 U.S.App.D.C. F.2d 447 145 FCC, U.S.App.D.C. 444 sion v. Broadcasting Co. citing (1971), Johnston F.2d U.S.App.D.C. F.2d FCC, U.S. L.Ed.2d Office of of United Church of Communications 14. 447 F.2d at & Christ v. 994, n.35. 15. See Formulation Relating of Policies to the Applicant, Renewal does obvious, the Commission It is comparative as a li RKO’s merit it, is enti seriously deny that RKO censee. general policy, Rather it ais under the expectancy renewal existing tled to no wholly apart RKO, from which ostensibly adopted reasoning of CCC mandates that granted renewal will be barely avoided a RKO the Commission. a challenger proves unless that it will “in and re service finding provide insubstantial fact” better service than the ex finding “aver isting a lukewarm ceived licensee. Initially, may we strike nei deserved age” performance the “unless” clause off the last sentence. RKO nor demerit.16 ther merit comparative general factors in finding of “substan designed entitled to not be to determine which competing the Commission’s applicant under provide tial” service will practica “best And, suggested guidelines.17 post-CCC And, indeed, ble service.”18 the Com above, Commission did as established mission has affirmed that the factor of to re entitled RKO was find that diversification of ownership of communi past performance. basis of newal cations facilities is a factor above and granted Indeed, expectancy renewal beyond practicable the “best service” det with RKO’s nothing to do to RKO ermination.19 Thus, the comparative licensee, rath performance as a own hearing process is designed to determine upon general policy of premised er was whether the challenger will, under the existing ensuring the “continuation only predictors the Commission recog proved that challenger unless a service” nizes, “in provide fact” better service. provide better service fact” it would “in The issue is grant whether the of a re existing licensee. than the newal expectancy such as was given to prevents RKO itself that determination. thus have seen that renewal We I think it does. quite dis- awarded to RKO expectancy approved in from that CCC tinct The whole of the Commission’s effort It remains accepted by the Commission. opinion prior passage quoted in its expect- renewal seen whether that to be in Part A above is to establish that nei holding is inconsistent With ancy significant ther has a advan reasoning of the Federal Com- CCC and Making tage over the other. heroic munications Act. assumption that the Commissionsucceed Expectancy Granted effort, must, B. The Renewal ed in it still under Comparative CCC, choice; to RKO Shortcireuits make a it Hearing Procedure make a must selection. The mandate of Act is thing

The first must one notices about the previous it choose and has on occasions expectancy granted managed fairly to choose basis of considered equal records.20 But is at precisely nothing whatsoever to do page & 7-9, nn. confidence RKO would p. expression - pages upgraded & meet 7-9, nn. 690-692 & station the established nn. supra. if standards, 7-9. such standards had and is existed, suggestion, holding, not much less Relating any a that Formulation of Policies Compare engaged RKO in substantial service within the 27 F.C. to the Broadcast Renewal Applicant, guidelines. (1971) intendment the 1971 proposed with RKO 582 580, General, Inc., C. 2d (Hearing 44 F.C.C.2d 18. See on Comparative Exam.) (discusses program in detail RKO’s Hearings, 1 393, F.C.C.2d 394, 395- ming categories programming various the (1965). 98 Programming identified in Network Inquiry, Fed.Reg. Broadcasting 19. See Terre Haute (1960)). 25 court, 7291 25 Corp., The 169 - page (1970). 348, n.36, F.C.C.2d U.S.App.D.C. F.2d 515 page n.36, makes the assertion that the 699 See, g., Hearing e. the Star Inc. v. Television, FCC, Examiner belief” that 135 “expressed 1086, 416 F.2d U.S.App.D.C. 71, denied, RKO would have met standards cert. “substantial 888, U.S. 171, refer 396 24 L.Ed.2d 163 However, service” if had existed. they (1969) aff’g Flower 9 Corp., ence to the Examiners 44 Television City F.C.C.2d opinion, 249, recon. denied, reveals that this was no more F.C.C.2d 10 F.C.C.2d 718 228, than an

711 pulls up Second, point that purpose.22 Commission that it is clear that comparative a and refuses to make truly short Commission did use the choice, holding when in doubt it expectancy renewal as a “burden of stated, proof.” renew. As I the re must Nowhere does the Commission expectancy has granted judgment comparative newal make a between comparative quali nothing to do with applicants, its the two even with a burden may proof and thus use of that factor Fidelity. fications Its whole discus simply justified one more ele goes prove be as sion that RKO So, comparative qualified balance. ment to be a licensee and is entitled expectancy pre Indeed, use of the a expectancy. renewal challenger making from expressly its Commission vents refuses to make a be a better comparative that it will in fact licen saying by case judgment, fiat comparative forestalling the deci see none of the appli differences challenger’s which provide will establish cations sion the basis for making reasoning This Catch-22 contention. choice.23 nowhere comparative completely shortcircuits vides comparison reasoned of these process avoids the “over differences; since it advantages it treats the upon an relative determination evalu all disadvantages applicants two 21 all which is the sine factors” sure, ation makes comparison. no To be comparative licensing. non of qua Commission asserts that none of the par preference ties are entitled to aor analysis It is no answer to as demerit, concepts as if those two simply imposed that the Commission sert nothing all or issues. But never holds proof” challenger “burden of comparison other, to each Fideli prove qualified under is better ty or RKO have some advantage should First, criteria. of, disadvantage or respectively, because ever not heretofore in past performance. diversification challengers they spe have a formed And, developed as will be Parts C and proof burden of exists wholly cial which below, D very significant there are dif and, apart from the criteria applicants ferences between far as one language can tell from the even reasoning under the Commission’s reports, expressly ap has never provide could for a comparative the basis plied proof.” such a “burden choice.24 no reasons in Commission advances than two opinion departing prior prac important But more these from Thus, the renewal apparent. points, tice and none are I would hold granted should at to RKO violates the expectancy matter least remanded for (1967); Community Broadcasting Corp. General, v. 23. RKO 44 F.C.C.2d 137 FCC, U.S.App.D.C. 124 363 F.2d 717 Television, (1966); FCC, Tennessee Inc. v. point might, glance, 24. This appear at first too U.S.App.D.C. 316, (1958); 262 F.2d 28 Pinellas reaction, attenuated. If the reader has this I Broadcasting FCC, U.S.App.D.C. 236, Co. v. suggest comparison between denied, U.S. supra cases cited in note 20 and the discussion L.Ed. 869 W. S. Butter regard in Parts C and D infra to their treat Theatres, FCC, field 71, Inc. v. “preferences” ment of relative and “demerits.” F.2d may Reference also made to Mid-Florida FCC, Broadcasting Johnston Co. v. 85 U.S. Corp., 9-10, 21, Television re App.D.C. denied, (1972), view rev’d on grounds, FCC, U.S.App. TV Inc. v. 22. See Garrett D.C. 495 F.2d 929 cert. 419 (1975); Broadcasting F.2d 513 System, 1056 Columbia 986, 245, (1974). U.S. 95 42 S.Ct. L.Ed.2d 194 FCC, 175, U.S.App.D.C. 147, Inc. v. clearly The Commission could have made a 1018, 814, (1971); F.2d 1026 see 454 also Local comparative simply did not. NLRB, 387, U.S.App.D.C. v. Teamsters 167 564, (1975) (Bazelon, F.2d 512 571-72 n.15 & concurring part, dissenting part) J. C. authorities cited. 712 Com course, the Federal of provisions And, there

express of ly eliminated. ex relating to renewal Act or in munications in the Commission precedent no (1970) states 301 § 47 U.S.C. expectancy pectancies. renewal for courts be construed shall license “no such I need performance. past on based terms, beyond the right, any specifically to create that CCC hardly point out the license.” conditions, periods competitive relied on expressly by buttressed statutory provisions, Other the Com strike down argument spur for law, provide reinforcement policy.26 case renewal previous mission’s a three very concept of command.25 There are substantial antitrust holder be demands license year First Amendment considerations which license’s competition subject support my position. expressly As CCC advantage grant an To term. recognizes, perhaps significant the most to the in process hearing comparative qualification ig wholly un reasons licensee cumbent policy nored a' that entrenches fu past and performance, related incumbent licensee is diversification ture, competition nullifies ownership.27 The guides, diversification was de licensing scheme year three important single the most factor expectan renewul A preserve. signed hearing,28 constitute could performance past on cy based prime legal rule dealing with the ex by providing competition encourage fact tremely concentrated VHF television licеnsee. A diligent for the haven a safe guides market.29 The thus serve both past on based expectancy not renewal concerns, antitrust regard to the mar opposite result will have performance ket for television advertising, and First provided by spur competitive since Amendment concerns increasing the substantial will be year license three Commerce, Report eign supra, on Network Broad See authorities cited 10-11 number of speakers.30 diverse applicant possesses The di which no other media guides versification serve First Amend interests over an which does possess ment concerns in another manner as other media interests. In its passle program regulation Policy The Comparative well. Statement on presently enforced Broadcast policies Hearings, FCC the Commission had say violate the First Amendment in about diversification guides: other than telecommunica any context justification providing a tions. We believe there primary are two ob- regime Amendment different First jectives toward process which the field is the al the telecommunications comparison should be They directed. “scarcity” leged speakers, of broadcast are, first, practicable the best service scarcity which if the truth were known public, and, second, a maximum product extremely concentrat is a diffusion of control of the media of ed VHF television market.31 Failure to mass communications. . . . Since effectively deal with the concentrated independence and individuality ap- VHF television market will increase proach are elements of rendering good pressure program for more control. program service, the primary goals of thus erode our First Amendment We good service and diversification of con- ways by freedoms in two refusal trol are fully also compatible. guides. enforce the diversification I conclude foregoing from the discus- As in the past, we will consider both sion the court’s decision in the common control and less than control- present case is inconsistent with CCC ling interests in other broadcast sta- both because it compar- shortcircuits the tions and other media of mass commu- hearing ative process and because it nications. The less degree of in- eliminates competitive spur upon terest media, stations or significant part CCC relied in less will significance be the of the fac- holding. Moreover, I think the re- tor. Other interests in the principal expectancy granted newal to RKO vio- community proposed to be- served will lates the Federal Communications Act normally be significance, of most fol- independently of CCC. A review of the lowed other interests in the remain- Commission’s treatment of the diversifi- der of the proposed service area and guides cation present pro- case finally, generally in the United States. vides additional evidence the Com- However, large control of interests mission both compara- shortcircuited the elsewhere in region the same state or tive process and violated the may well be significant more than con- Federal Communications Act with its re- trol of a expression small medium of expectancy newal for RKO. in the same community. The number of other mass communica- Its Own Follow FCC Failed C. tions outlets of the type same in the Fidelity’s Di- Ruling on Its In Precedent community proposed to be served will Advantage versification also affect impor- some extent granted traditionally tance of this factor general The FCC in the advantage scale. significant to. States, citing part), FCC, Press v. United Associated 30. See Citizens Comm. to Save WEFM 191, 209-211, 89 L.Ed. U.S. 506 F.2d (1974) (Bazelon, J., 270-72 concurring C. result); U.S.App.D.C. 349, TV Inc. v. Bazelon, Regulation 31. See of the Tele- FCC Press, Duke communications L.J. U.S. 42 L.Ed.2d 194 point. complete discussion of this Multiple Ownership Standard, FM and Tele Comparative Statement on Stations, vision Broadcast 50 F.C.C.2d Hearings, (Robinson, and id. at Comm’r, concurring part, dissenting advantage some kind versification The diversification issue is standard clearly required. The Commis- comparative duly issue and was con- this, compara- by avoiding a sion avoids Hearing Examiner and sidered decision, B as was noted in Part tive the Commission. seen, all the Commis- As will be above. developed. The following facts arguments against Fidelity’s “pref- sion’s standard, was the licensee of FM RKO advantage erence” or diversification broadcast television licenses in New and significance, to reduce its not serve (#1 City viewing York market in the vestige entirely. it is eliminate (#2 country); Angeles viewing Los by arguments directed to eliminated not market); viewing market); (# Boston policies avoidance diversification Windsor, (serving # 6 Ontario Detroit comparative of a decision. (#45 market) viewing Memphis market). RKO was the licensee breath, the fol Taking deep I note standard and FM stations Wash lowing arguments reducing ington-Bethesda (#9 viewing market) First, advantage. diversification (#10 viewing Francisco mar San that there are points out ket). controlling has interests in a stations, 126 radio stations television massive number of franchises CATV 9’s newspapers within Channel numerous serving almost 100 cities and towns. Second, contour. the Commission signal towns are Several within Grade B sought to in has never that RKO finds contour of Channel 9. RKO has other KHJ—TVto operation of fluence the interests, including media microwave views. expression of a uniform mote facilities, communications a chain of attempt Third, Commission will the. theaters, programming movie and adver industry in broadcast restructure tising services and a small interest in a hearings.34 These reasons newspaper in Schenectady, New York. utterly inconsistent completely Fidelity has no other media interests. A reported comparative decision every with Fidelity 3% stockholder of has a 10% in to locate. Per has been able my office terest in a CATV franchise 50 miles audacity of unmitigated haps it is Angeles. from Los is That the extent of the court into that stuns the Commission Fidelity’s media interests.33 repeal the di accepting sweeping facts, From these the FCC reached the the rea guides. Whatever versification son, appli- miraculous conclusion neither beyond cavil that Commis cant was entitled to a diversification simply not bear reasoning will sion’s “preference.” indicating Before the ab- assump one makes analysis unless conclusion, surdity of this necessary repealed the that it has sub silentio tion point out finding this of no guides. “preference” does not mean that if a made, evaluation were Fi- First, as the delity advantage would have no on di- clearly provides and as has been followed

versification. If the FCC had in fact every case promulgat decided since its comparative determination, made a a di- ion,35 the existence of other media of 35. See Terre Haute Broadcasting Corp., stockholder another asserts The FCC WHDH, (1970); F.C.C.2d Inc., 350-51 interest unstated of an 26% 1, 12-13, denied, “newspa publishing 16 F.C.C.2d recon. corporation in a interest aff’d, (1969), Angeles F.C.C.2d 856 Greater Boston Tel RKO Gen pers” Los suburbs. FCC, evision eral, 44 F.C.C.2d (1970), properly holds court considering U.S. 29 L.Ed.2d 701 “fact” error committed Broadcasting Corp., Ultravision its as was denied a since aff’d, WEBR, simple Inc. v. 410-11 & n.29 “newspapers” were these sertion U.S.App.D.C. 316, 420 F.2d 158 “throwaways.” advertising ultimately awarding - While n.42, n. 42. page 701 page license to the diversification General, Inc., 34. RKO prop advantage, affirmed viewing fact, market. In community may policy type same implicit group However, ownership extent. to some weighed broadcasting chain Even if all rules.39 cancels neither outlets of other existence wrong, this were we would still want advantage, nor indeed diversification consider how many of those other outlets principle This insubstantial. renders Angeles in Los are truly independent. Boston, cites such as applied in been has We know that at least two are by owned And no oth Haute, and Terre Buffalo.36 RKO itself and three VHF television li con plausible conclusion er by censees are owned major three in the Pol provision express sidering the flagship stations, networks as as well as and recent icy cases38 Statement37 an unknown number of radio stations. are directed to guides diversification the nation Second, none, of control repeat concentration none,40 only within a regions, not considering cases several diversification Standard, discount media outlets that other FM and Broadcast Sta- osition Television preference tions, (1953), and do not at all diversification 18 F.C.C. 288 mod. Storer Broad- Corp., States, U.S.App.D.C. casting Television 33 it in Mid-Florida v. United 95 eliminate Co. denied, 9-10, reinstated, 1, 97, (1955), recon. 37 F.C.C.2d 220 F.2d 204 351 U.S. F.C.C.2d part 763, ground 192, 1081, (1972), on this rev’d 76 S.Ct. 100 L.Ed. affirmed on 559 complete remand, 369, give U.S.App.D.C. consideration to diver 99 240 55 failure F.2d FCC, sification, 9, U.S.App.D.C. (1956). Broadcasting 161 TV Inc. v. also v. See National Co. denied, States, 190, 997, (1973), 349, cert. 419 U.S. 87 F.2d 929 United 319 U.S. 63 S.Ct. 495 245, (1974), citing (1943); Iacopi FCC, 986, 194 42 L.Ed.2d 1344 v. 451 F.2d 95 S.Ct. L.Ed. 249, Corp., 1971); City (9th 9 Television denied, F.C.C.2d Cir. Mount Mansfield Televi- 1142 Flower (1967), sion, FCC, 1971). 254, (2d 10 F.C.C.2d 718 Inc. v. 442 F.2d 470 recon. Cir. FCC, Television, aff'd, Inc. v. 135 U.S. Star intra-viewing mar Even when one considers denied, 1086, 71, App.D.C. cert. 396 416 F.2d concentration, RKO would ket under estab 171, (1969). 888, 24 L.Ed.2d 163 90 U.S. precedent be entitled to a substantial lished Radio, Brandywine-Main v. Line Inc. also See RKO,. demerit. as stated in diversification 305, 16, C., U.S.App.D.C. 473 F.2d 28 153 F. C. (1972), text, AM and an FM station in owns an 922, denied, 412 U.S. 93 S.Ct. cert. Angeles as well cable franchises Los as certain (1973) (only inquiry 2731, un 149 37 L.Ed.2d See, e. 9’s Grade B contour. within Channel within a licen Doctrine is balance Fairness der 891, Corp., g., Industrial Business 47 F.C.C.2d viewing programming and not see’s own Community 892, (1974); 897 Lorain Broadcast ‍‌​‌​‌​‌​​‌​​‌‌‌​‌​​‌‌‌​​​​​​‌​​‌​‌​​​​​​​​‌‌‌‌‌​‍whole). aas market Co., denied, ing 14 13 F.C.C.2d recon. 604, denied, rehearing 15 supra. F.C.C.2d F.C.C.2d citеd note 35 See cases 36. denied, (1968), 686 review 18 F.C.C.2d 388 Comparative Broadcast on aff'd, FCC, Broadcasting, (1969), Allied Inc. v. 393, (1965). Hearings, 394-95 1 F.C.C.2d 264, 68, (1970). U.S.App.D.C. 435 F.2d 69 140 670, Pirtle, (1973), Billy 43 F.C.C.2d 671 T. FCC, Radio, Scripps-Howard Inc. v. also See Television, Valley citing 26 River Snake 13, 677, denied, U.S.App.D.C. cert. 89 (1970). Korngold, Alvin L. See 380 F.C.C.2d 830, 55, 72 S.Ct. 96 L.Ed. 628 342 U.S. 1, (1974); The News-Sun 4-5 F.C.C.2d 45 extraordinary 40. The court makes a rather cite 770, Co., Broadcasting 24 775 — 76 F.C.C.2d McClatchy Co., Broadcasting 343, 19 F.C.C. Co., Broadcasting 19 (1970); St. Louis East (1954), McClatchy Broadcasting aff’d also McKen See F.C.C.2d ney FCC, U.S.App.D.C. 99 Co. v. 239 F.2d 15 FCC, F.2d v. (1956), denied, cert. 353 U.S. 77 S.Ct. McClatchy Broadcasting (1963); v. Co. 444 FCC, U.S.App.D.C. (1957) 1 L.Ed.2d 665 Hearing in which the (1956), 239 F.2d 15 “autonomy” Examiner relied on the so-called argument prefer to reduce a diversification (in these cases the court L.Ed.2d (although it). ence not to eliminate But the awarding a com actions affirmed accept reasoning, Commission refused to applicant against with me parative demerit Hearing reversed Examiner’s recommenda area.) gen See the service outside ties dia tion awarded to the with the Publishing Clarksburg erally Co. advantage. diversification This court affirmed. 211, 225 F.2d course, the Of court is correct that the Com Standard, Ownership Multiple FM mission “considered” whether the licensee had Stations, 50 F.C.C.2d and Television goals met the of diversification autonomous (1975); Multiple Ownership operation, -, U.S.App.D.C. page Standard, Broadcast Sta- FM and Television page fails to inform the recon., tions, rejected reader Multiple Ownership guides consider the fact the owner leading upholding cases applica strict imposed expression uniform guides. tion the diversification ruling views in application court does not cite and shows no aware guides. To do so would run counter tc ness of the multitude of Commission the oft stated maxim of antitrust law cases which are inconsistent with this that one does not distinguish between reasoning, though even we have only “good” monopolists and “bad” monopo recently proposition reaffirmed the application lists in of antitrust policy.41 the Commission must follow its own Moreover, the Commission does not in precedent explain why it has not42 form us how one defines uniform expres possible One prece distinction of these sion of views opposed to local expres dents, court, not mentioned sion of views. To make the distinction they all involve non-renewal com very raises serious First Amendment However, parative hearings. this dis questions indeed. Third, the Commis goes to the weight tinction of a diversifi sion’s reference to restructuring of the preference cation comparison in with the broadcast industry is entirely gratuitous past broadcast record of the ap renewal and conclusory since the diversification plicant and does not at all purport, in guides by their nature will cause restruc any one, except case this to affect the turing applied. if The reference is thus ascertainment of a diversification advan no more than a bad humored attack on tage place. in the first The Commis the existence of guides. the treatment sion’s of the diversification bizarre, guides truly The court affirms this in this case vertigi illumines its in reasoning by simply tent the incanting erecting nous in renewal expectancy it citing support out loud and in two mentioned in Parts A and B. Without argument. cited In the cases in notes 28, Hale v. FCC, 125, 425 F.2d U.S.App.D.C. there is no evidence of 35, 38-39 Com- supra, The Commission promoted ruling consideration of in mission autonomy as a approach measure while temporary weight of a diversification preference. it examined proposed rules and this court ex rejects reasoning of those cases implicitly affirmed it that basis. pressly As the such a contention. amicus Citizens of the rules on adoption re cross-ownership argues, rejection the autonomy Communications Center of the ad hoc present approach seemingly would the nullify rationale general multiple the of a expression sentiment that the group as well as dangers ownership provisions, or to because diversity of the power argue rules, since gained through the licensee could duopoly is concentration sufficient to “goals” has met that of the rules by the concentration. prohibit Owner Multiple And, “autonomous” as be evi- operation. may of Standard, FM and ship Television Broadcast in dent, Commission its decision did not Stations, 50 F.C.C.2d These on “autonomous” so much as operation rely rules the limit of represent cross or common fact there was no evidence that as a ownership factor; disqualification they of was exercised to control hearings ownership promote are to be extended in comparative of views. through a uniform guides. expression the diversification Id. (since 1087-88 rules are Turning cross-ownership to the Commission’s true rationale, large major spective, part, consideration of that ad hoc clear into whether inquiry is hearings diversification will comparative oc demerits translate into a failure diversification proceedings). cur in renewal of what diversity require prescience of of a skill views, “uniform” expression is 41. See United States v. Socony-Vacuum Oil is not to achieve required Commission 150, 213-14, 221-22, 310 U.S. 60 S.Ct. Co., achieving. has shown no success Cf. (1940), citing 811, 84 L.Ed. 1129 United States FM and Tele Standard, of Ownership Multiple Co., v. Trenton Potteries 397 — Stations, vision L.Ed, 377, 71 The policies (Robinson, Comm’r, concur in these cases, stated two there is no ring). has followed ap The Commission or administration feasible efficient manner ex and unsuccessful limited very to proach against to abuses, ensure monopoly power deny cross-ownership in petitions tent logic. Commission’s Broadcasting applicable g. Coa E. Columbus situations. 213, 217-218, FCC, lition 42. See sources cited note 22 supra. (1974); Stone v. 320, F.2d 145, 466 of, in which ner reasoning speak supporting Commission removes Fidelity’s advantages nullifies the diversifica RKO’s disadvan- hear tages fully guides in does tion eliminate the exist- court, laboring valiantly, advantages ence of ings and the and disadvantages. pur Rather, said, I have it. And for what sweeps up behind performed never told. a failure make a pose we are deci- sion. underlies this extraordi Perhaps what The Commission takes its feeling the instinctive hatchet holding nary “integration ownership into substantial diversifica man despite its agement” factor and here get we really Fidelity is not advantage, tion procеdural stench of bias. Fidelity, feeling This good applicant. an admits, has on several obvious based comments ad apparently vantage in this factor. The to the effect Hearing Examiner these giving adduced reasons for experience renders it lack “preference” no First, the factor. But it should be as a licensee.43 suspect Commission notes that managers that no new voice will absolutely clear KHJ, owners, while not do have this is inherent in experience; autono ever mous control of the important if it station. This argu is an being new. And ment, course, policy to nullifies factor increase communications has never been voices, speakers, my considered of diverse knowl number edge system, goal evaluation telecommunications of “integration” avowed, so, factor.45 go then Even just we are frequently this ar gument says nothing inexperience mistakes of about Fidelity’s ing to risk ad vantage,' both through integration of a lack of diverse against the mistakes through local event, ownership and the issue cannot In does speakers. not purport even to weigh appeal Fidelity’s this since the dispositive on advan be tage against RKO’s. expressly not did make it a for decision.44 ground argument second The Commission’s brief Fidelity’s as a characterized Comparative Misap- Factors D. Other Fidelity’s right to abuse of “monstrous plied By the Commission is, anything, if an This process.”46 due mutilation the di- dis The Commission’s of The Commission understatement. is, unfortunately, Fidelity’s integra guides viability of versification counts of its of treatment because of unverified only indicative proposal tion Again, factors. Bureau in a Broadcast allegations guides, enlarge the man- issues which the diversification petitions General, 383, 841, Inc., 123, (1970), F.2d denied, See RKO 444 44 862-63 cert. F.C.C.2d 923, (1969) (Hearing Exam.). 2229, 226-27 403 U.S. See 169 U.S. L.Ed.2d 701 App.D.C. (1971); pages ---, Broadcasting Corp., Ultravision 726-729, pages aff'd, (1968), WEBR, infra and 408-09 sources cited. Inc. FCC, U.S.App.D.C. 316, v. 420 F.2d 158 Chenery 44. See Corp., SEC v. 80, 92, 318 U.S. (1969); City Corp., Flower Television 9 F.C. 63 S.Ct. (1943); L.Ed. 626 cf. Citizens denied, C.2d recon. 10 F.C.C.2d 718 to Preserve Overton Volpe, Park v. 401 U.S. aff'd, Television, FCC, Star Inc. v. 91 S.Ct. (1971); L.Ed.2d 136 Burlington Lines, Truck States, Inc. v. United 396 U.S. 90 S.Ct. 24 L.Ed.2d 156, 168-69, 9 L.Ed.2d argument The Commission’s nullifies because, course, the factor always of there will integration management employees into See, g., Broadcasting Corp., e. Terre Haute management; this is a truism. The factor (1970); 25 F.C.C.2d 348 The News-Sun Broad integrate management. seeks to owners into Co., casting 24 F.C.C.2d Policy Comparative Statement on WHDH, Inc., 1, 13-14, recon., 16 F.C.C.2d Hearings, (1969), aff'd, 17 F.C.C.2d 856 Greater Boston Television, at 123. Television 46. Brief for by the Ac Commission47 wisely were denied The court ignores this second although Fidel allegations, cepting these half of Commission’s butchering them, dispute had a chance to ity integration never factor. Instead the court they demon states to the rationale the Commission returns of the Hearing inability “unwillingness an Examiner who held that strate inte responsibilities appli as an carry gration proposal out its implement could not be question management-owners and hence call into Fideli cant” ed because allega integration proposal. experience. ty’s Apparently, no broadcast Fidelity was remiss in not Hearing are that neither the court nor the tions Exam informing the Commission stock iner consulted the 1965 agreements signed by subscription way advises us on that owners, failing to secure agents of issue: so prompt ratification of documents experience, Previous broadcast while failing report signed and in significant residence, so as local significant changes corpo put months value also has some when to use company. structure How through integration rate ownership leap from these al management. does empha- . . . Since legations to the conclusion upon sis this element discourage could implement integration will qualified newcomers to broadcasting ques There is no answer posal? experience generally and since confers opinion. in the Commission’s It tion advantage (Lack an initial of ex- hardly requires extended reflection perience, high unlike concentration allegations go control, to char conclude .), is remedial . . acter but since no character issue was significance. will be deemed of minor course, This, dispose does not hearing, added to the consideration con proposal inappropriate.48 integration can basis would tentions absolutely it does implemented There is no demonstrated re call into not be allegations pos assertions lation between all the confident doubt inability implement Fidelity’s integra Hearing plan sible the Examiner proposal. piece The Commission was ar of business.”50 And it tion a “foolish bitrary (but Fidelity’s pro suggesting in the extreme in remembered must be Simon, overtly stating) only there was. that a Mr. posal never 20% And, course, stockholder, if the even relation exist would be President ed, Fidelity’s Manager, that a would not eliminate ad 2% General stock vantage any in public evaluation director of holder would be service only weight. but would affect The rest of the programming. staff may gleaned only (1970). changes General, Inc., the 22 F.C.C.2d facts 47. RKO parties, Inc., pleadings General, the which differ 44 F.C.C.2d from See RKO substantially. never resolved The Commission (1973). pleading or even com in the conflicts Policy Comparative apparent acceptance until its on them mented Hearings, 1 F.C.C.2d Broadcast General, Inc., 44 in version RKO of RKO’s (1973). The additional refer F.C.C.2d Fidelity’s explanation is re- events of these opinion to the late in the Commission’s ence denying opinion Commission’s cited “newspaper” alleged interest reporting anof Inc., General, issue, requested character recog inappropriate and was so completely appears that one It court. nized directors did board of member of n.42; page page --, note 33 subscription signature on a stock authorize supra. to a committed in fact believe himself did company. $5,000 The indi- Comparative in the investment Statement on Hearings, as a member did fact function vidual F.C.C.2d 396 & n.8 Commission, although according citing board Sunbeam Television any issues. of these held a never 29 & n.6 relating changes in Fideli- issues The General, 50. RKO 44 reported corporate late but ty’s were structure Exam.). (Hearing decision. the Commission’s well before professional broadcasters. In and since RKO has an “unblemished” event, the court has no authority to record as a broadcaster for years, affirm Commission on ground it Commission will not assess compara not offer. itself did The affirmance is tive demerit.54 The court in affirming clearly wrong point.51 on this takes a slightly different tack. The come to the Commission’s We next court independently concludes, without the character issue set treatment the aid of either the Hearing Examiner of its against Commission, RKO because admit down or the that “most” of the dealings, reciprocal a violation of reciprocal dealings ted were ineffective and Trade 5 of the Federal Commis those that were Section effective “have little to Act and 1 or 2 of the sion Sections Sher with do RKO.” recognizes court reciprocal dealing simply man Act.52 I do not have the was declared ille energy time or in 1965 space, gal to describe at a minimum and probably earlier, minefield the thus procedural implicitly Commissionlaid much discounting point Fidelity on this and the the Commission’slogic.56 numer On the basis of backings fillings, analysis, shifting ous remark that “KHJ was years ground, part a small Commission what went on” and sought clearly to avoid consideration of this incorrect ob assertion that “anti comparative and non-comparative trust considerations are only vious seg one it to list ment issue. Suffice admitted Commission’sconcern with character”, after the dust facts had settled. The the court holds the FCC arbitrarily.57 found that on the did not act Commission basis of extremely myopic view an of the evi The court clearly reciprocal dealing RKO’s dence violations mistaken in its assertions about the patronage to mutual nature situa recip limited rocal dealings. Both the recip It then concluded that such tions. Commission and the Hearing dealings Examiner were not at rocal time found com pleted acts of at least clearly illegal under the mutual antitrust laws patronage involving KHJ that thus the Commission resulted signifi would not cant advertising charge “knowing RKO with revenues willful station.58 These Furthermore, acts clearly misconduct.”53 many corporations since violate Sec tion 5 of the Federal engaged Trade such Act and at violations, least since after presently RKO is under violate the Sherman Act.59 The injunction regard practices to such is ex supra. patronage 51. See reciprocity sources cited note 44 in successful mutual Pepsi-Cola, Mathieson, Alcoa, Olin Amer- (1970); 15 52. U.S.C. §§ 45 see discussion signifi- ican Airlines Hertz that resulted in in note 59 infra. $36,500, (respectively, $12,350, $8,069, cant $9,650 $14,500, $15,210 $90,025) General, Inc., to to increas- 123, 53. RKO 44 F.C.C.2d 130 advertising es in KHJ (1973). revenues. See RKO General, Inc., 149, 202-04, 210-11, 44 F.C.C.2d Id. The 54. Commission’s reference to RKO’s (1969), summarized, 123, 212-15 baffling “unblemished” record is somewhat (1973) (Lee, Comm’r, dissenting). 143 just concluding since it had finished that RKO “Thus, question Commission itself stated: acts, engaged illegal only in had age past an aver- reciprocal dealing here is not whether practiced was best) (at record and was the member KHJ-TV, respect to but wheth- conglomerate. a sizeable of communications adversely upon er this conduct should reflect What does the Commission think is a “blem- operation of the station.” Id. at 129. ished” record? Corp., Foods 59. See FTC v. Consolidated 38 U.S.App.D.C. page -, 0 55. 169 515 F.2d 592, 594-95, 1220, U.S. 85 S.Ct. 14 L.Ed.2d 95 page 698. (1965); Mfg. Allis-Chalmers Co. v. White Con -, -, pages U.S.App.D.C. Id. Industries, 56. 169 515 Inc., 506, (3d sol. 518-19 pages 697, F.2d 698. 1969); Packing Corp., California 25 Cir. F.T.C. Foods, (1937). In 379 preme Consolidated the Su U.S.App.D.C. pages -, -, 57. Id. 169 515 merger Court found a violated Section 7 page F.2d 698. Clayton possibility Act of the because of the of establishes record particular, In reciprocal dealing. possibility recip- If the of engaged company, parent Tire, RKO’s General 720 by economic garnered the anti advertising is to enforce commanded

pressly competition.61 Even be not successful against licensees.60 power laws trust that RKO dealing to the fact reciprocal considers this, of one use When yond engaged in overcom- the incentive advertising reduces found was obtain of the public mercialization,62 since the seriousness needs of meet merg dealing F.2d 841, aside a 444 850-52 383, is sufficient to set rocal engage 923, 91 actual 403 U.S. 29 2229, S.Ct. L.Ed.2d 701 certainly must follow er, it (1971). dealing some violate in reciprocal ment ambiguity relating laws. Lower The one in anti-trust this record provisions violation of have conclud RKO’s the anti-trust laws Consolidated Foods since concerns courts degree of market 1 Sherman Act Sections and 2 of the power necessary make ed that illegal. dealing. There See W. L. is some confusion by reciprocal reciprocity are offended cases, 381 when v. Carlisle one refers Corp., F.Supp. particularly & Assoc. Gore (D.Del.1974); cases, States v. Gener tie-in whether some kind of 703 United 680, market leverage 57-59 must be 36, 258 shown to make Corp., F.Supp. reciprocity al Dynamics illegal. Conglomerate Mergers (S.D.N.Y.1966). Turner, This uncontr seems a Cf. fairly outlawing tying 7 of the 78 Harv.L.Rev. § Clayton Act, extension the cases 1313, oversial (1965). being arrangements (reciprocity a form issue, This while serious simply from tying). States Steel examination case, See Fortner v. United the facts in this my 22 considered 495, 1252, by 394 U.S. 89 not the Commission. Since S.Ct. Corp., L.Ed.2.d (1969); Northern R.R. v. United case should Pacific remanded under view my 495 I 545 1, 514, 356 U.S. 78 2 L.Ed.2d think the Commission States, S.Ct. should the mat- explore (1958); States, International v. United ter further with the Salt Co. aid of the Justice Depart- 392, 68 S.Ct. L.Ed. 20 ment. U.S. 92 332 in Consolidated Indeed, Supreme Court Broadcasting See National v. Co. United declaring an unlawful Foods, reciprocity States, 319 U.S. 190, 222-24, 87 merger, of a relied on specifically consequence (1943); L.Ed. 1344 FCC, Philco v. Corp. 110 reasoning of the 380 U.S. at tie-in cases. (1961); 387, 293 F.2d 864 U.S.App.D.C. Allen not S.Ct. 1220. And even if it does 594, 85 Broadcasting town v. FCC, U.S.App. Act, clearly the Sherman reciprocity violate F.2d 781, 787, D.C. rev’d on other Section 5 of the Federal Trade Com violates grounds, 349 U.S. 358, 75 S.Ct. 99 L.Ed. is not a Act. Since mistake of law mission Mansfield Journal Co. v. charges, to civil or criminal see United defense 180 F.2d 28 Barker, -, States 61. See RKO General, Inc., 44 F.C.C.2d (Bazelon, (1975) concurring), J., C. (1973) (Lee, dissenting), citing Comm’r, circumstances, some ex fairly most requires Broadcasting v. Pottsville Co., FCC RKO’s faith to traordinary leaps excuse 134, 60 L.Ed. 656 of the And it violations antitrust laws. clear discussing remembered that we are must See RKO General, Inc., F.C.C.2d “knowing” miscon (1969) where disqualification, not (Hearing Exam.). 172-73, These (although mis relevant particularly duct of fact statements are not varied the Com- by generally law are part takes mission’s which notes that RKO “knowing” requirement), but only comparative advertising not violate the did NAB Code evaluation. General, time. RKO Inc., F.C.C.2d (1973). This statement supported assertion The Commission’s off-the-cuff reasons or evidence, both of n.21 General, RKO light necessary fact RKO does of com- insufficient amount not subscribe NAB Code and bring affected to bear the sanc- merce 50-51, Exhibits summarized in its brief at 88- the anti-trust erroneous clearly tion of laws to offer purport proof RKO consistent- reasons. First, require- two commerce violated NAB jurisdictional ly Code provisions. for federal is a ment requirement and the Commission in their briefs respond tied to and says courts of federalism policies arguing essentially there are no nothing standards trade prac- about of the validity judge which to whether a licensee has en- by Thus, since the has estab- tices involved. FCC gaged in overcommercialization. They are jurisdiction licensees, over individual lished correct Commission has relied on a jurisdictional relevant is not requirement case-by-case inquiry, Commercial Practices to must look only hence Commission Licensees, Broadcast 36 F.C.C. 45 the trade practices validity the substantive not this does mean there are no standards gives no reasoned Second, FCC involved. challenge all. RKO seems the accuracy of no evidence conclusion, cites basis for Fidelity’s information on commercialization in with estab- correlates the evidence way in no (although of the NAB excess the rele- Code guidelines Bos- in area. See Greater lished explained); of the Code is vance not the Com- ton Television reciprocal dealings in poli terms of the by Commission,63 Fidelity filed on cies of the Federal Communications Act June petition a to enlarge the is manifest. And if one refers back to comparative issues at the hearing. The arguments the strained of the court and petition requested in the alternative that Commission on the diversification point, the Commission set down a 307(b) § is enough it is clear that economic concen regard sue in to the need of the South- tration in media both and non-media are land for an allocated television station or very heavily against should count Fidelity’s issue as to philoso “service RKO if provide not a disqualifi basis for phy”, pay special its desire to attention cation. The Commission’s failure of the needs Southland. Fidelity even weigh issue at in all the com requested general also a programming parative process only one more indica allegations issue on the basis of its tion that the Commission did not in fact substantially it would devote more time engage comparative in a decision. And to news local than affairs had RKO. what are we to make court’s petition accompanied This by an ex statement that KHJ a small survey 1,200 tensive ascertainment part of RKO’s antitrust violations? This community leaders and involving over argument seems support a 6,000 telephone conclusion calls and meetings with opposite from that drawn public court. officials and community organiza The holding on this is truly issue ex tions. traordinary. rejected the petition. The Commission procedural unfairness to finding 307(b) In terms Its on issue § is ac are instances un- Fidelity, preceding ceptable. I also affirm its holding In its treat- exclusive. fortunately not denying general a programming issue sug- issues programming petition alleged Fidelity’s ment since no facts Fidelity, the con- gested regard greater in need for local or evaluation a to avoid programming general. tinued news in procedural deci- through controversial has since 1965 become in sions. creasingly strict about the relation of the survey general ascertainment differ Denied Improperly II. The Commission of news percentage ences and local Specialized Hearing Fidelity’s on A programming because of affairs its con Issue Programming applicants were engaging cern that to obtain a “promise” battles Enlarge Is- license.64 Fidelity’s Petition to A. below, in Part B As I will discuss there Programming to Consider sues are First Amendment considerations motivating Fidelity’s factor major A approach. support Channel 9 was belief application for Orange County no at all perceive But I basis communities Angeles do not receive suf refusal to accord Fidelity Commission’s a Los southern philosophy” from television stations its “service on issue. ficient attention proper. philosophy” The owners of Angeles merely “service in Los specialized programming Channel 9 could be Fidelity believed form of de alleged as to signed in such manner meet to meet needs of an grammed particular they perceived portion to be the unfulfilled underserved serv what granted needs of “South- The Commission has ice area. communications comparative preference issues will programming significant land.” Since philosophy” in a hear “service the basis of Cen be considered Television, they specifically set down tral 35 F.C.C. ing unless Coast forthrightly Comparative mission should reconcile the dis- putes rely Hearings, evidence on a mere statement, conclusory particularly light Corp., Moline Television Id. See F.C. the fact that RKO does seem admit to some (1971). 263, 272-73 C.2d commercialization excess the Code. See General, Brief for Intervenor RKO Inc. at 45. 722 Fidelity’s being model clearly by the needs not served

(1963), there are local granted comparative has outlets? communications petition, present specialized basis of the preferences the second “reason” deserves more But cases.65 This in other programming scrutiny. Fidelity expressly states in its Committee to Save in Citizens court 307(b) is if the issue de § that petition FCC, U.S.App.D.C. 191, 165 v. WEFM nied, serve the entire service area it will (en banc) a (1974) reversed 252 F.2d to the needs of particular attention with denying hearing a into order Commission says The Commission Southland.68 the in a programming issue specialized by is not backed “factual assertion strongly assignment context license allegations allegations.” What factual that the Commission could indicated want? if Commission Even does to responsibility ensure di ignore appear, to this riddle would answer some in a service area.66 versity of formats does, very least none at Review Board de requested The Commission’s should have fur Commission Fidelity’s proposed philoso “service relevant, (what nied data would be data ther First, reasons. Fi these know) phy” provided issue with I do not nor alleged shown neither delity opportunity petition to amend their more than underserved of what facts being the Southland informed after Second, area. the service parts thought were relevant. It allega made “factual Fidelity has not Fidelity’s peti be remembered must ignore will not the remain that it merely tions” obtain seeks tion Third, area. there is the service proposed programming der of offers and that it community leaders express allegation no that the indication sought have and refused televi surveyed will serve the programming entire posed Fourth, Fidelity has not time. sion What more could the Com area. service ordering programs directed a need for hearing? shown want before mission Southland.67 The attempts court to affirm this by altering reason second Commis utterly de- first three reasons The rationale. Where the sion’s possible content. What rational void complained of a lack of factual fact alle there that other relevance support gations to the contention Angeles may Los under- as areas covered, the entire service area would be argu- Such an Southland? served court states that every specialized Commission’s program- defeats ment argument Petersburg decision is controlled implicitly Tele ming issue. 451, Corp., (1954). point A vision F.C.C. 464 — 65 by WEFM. similar rejected court, noting a fact not mentioned about the third reason. may be made Commission, states that expect seriously Does of interviewees contained list three specialized programming proponents Angeles proper; in Los interviews have unsuc- thus their listeners prove Fidelity “could ... be found to sought other broadcasters cessfully ignored city the actual of license in programming? specialized carry planning” as was found in Peters- can the Commission hold Fidel- how And burg. certainly It is true that the Com community actions leaders ity cite Petersburg mission does for its expressly hold state those leaders when General, 519- FCC, F.C.C.2d See RKO v. WEFM to Save Comm. Citizens See denied, special F.C.C.2d (1966), relief F.2d denied, 10 J., concurring clarif. (Bazelon, C. n.63& cited; cited authorities result) authorities Enlarge Issues 68. Petition Televi ‍‌​‌​‌​‌​​‌​​‌‌‌​‌​​‌‌‌​​​​​​‌​​‌​‌​​​​​​​​‌‌‌‌‌​‍ sion, infra. App. note at citing Inc. Joint Pe tersburg Corp., Television 19 F.C.C. 451 258-62, n.31 and 265-66 & 506 F.2d Virginia aff’d Southside Telecasting 880, Retail See also Local cited. authorities FCC, U.S.App.D.C. 130, v. Employees Store 100 L.Ed. 865 may not be sustained. The holding a is demerit ing—that fact, in terms ig finding of couched against applicant an who court’s awarded found”, “could have been is of area in portion a its service what of nores formulating proposed programming erroneous. clearly —but clear the equally that Commission it is that I conclude first these three rea could relied on that largely not and not have weight. did sons make The judice support holding its sub to case fourth reason is the more serious since it simple reason the in that incorporates the policy Commission’s Petersburg complete came a hear after correlating ascertainment efforts with programming ing into the issue. The proposed programming in put order to in Petersburg found on the programming Commission Apparently, down a issue. applicant’s of one ascertainment position basis survey, the FCC’s that was the data testimony and other evidence Fidelity’s petition stated in did not sup applicant ignored portion that specialized port programming propos area formulating in the service survey al since ascertainment did case, programming. In this Fideli posed identify any community problems not survey was ty’s ascertainment never in that programming needs to which would into evidence because no hear troduced cursory The most reading relate. of Fi Fidelity given ever held. ing was was delity’s petition indicates that it has of to opportunity contradict the court’s proof no any substantial that little if fered finding about its intentions. In factual deed, programming Angeles television in Los ig the court’s citation of evidence to the is directed local interests of the Fidelity placed the fact that nores also I do not understand the Southland. many telephone thousands of Rather, calls and dispute to Commission this. many letters than the inter sent argument is that the ascertainment sur petition.69 in its cited We do not views has no evidence vey on what those local queries to whom those were di know why they require are and interests hearing because no was ever held. rected require This telecommunications outlet. ment, Commission, course, avoided this previously, originated as noted in not, repeat not, by referring any issue inadequacies attempts “prom to control Fidelity’s ascertainment among applicants regard battles ise” survey simply stating and instead that percentages of local affairs and news Fidelity any had not alle made factual Its programming. seemingly rationale is that it fact service the gations would in applicable philosophy” “service And, argued, area. as I have that entire specialized programming issue since the remark, Hearing Hearing Exam- which was that Examiner’s mentioned This Inc., General, proposal might a further 44 F.C.C.2d result RKO iner. Exam.). becoming (Hearing Angeles proper id. (1969) See also to Los contribution special- doughnut surrounding (testimony supporting the hole in the “the at summarized). General, Inc., This RKO 44 F.C. programming issue communities.” ized Fidelity’s peti- Exam.). (Hearing This particularly crucial since C.2d is fact Fidelity (and explicit holding against if reference is not remark drawn tion were, subject challenge might avoid the Petersburg sought it well be decision and it, support Fidelity, unsuccess- like the evidence adduced in no since conclusion ignore course, Petersburg, and, no was held on the meant ful supra. issue), argument See note rather is that counts one service area. part specialized programming against issue if in us, mistakenly informs court specialized to be used in issue were fact - n.14, page noteworthy hearing. It Hearing Exam- n.14, page argument Hearing Examiner is against found iner directly argument inconsistent with the re- statement philosophy This issue. service evidence of there is no reasons, which first of several markable justify special needs of local the Southland Hearing could Examiner being specialized programming hearing a issue. even had issue which against find General, upon no record heard been never problem with developed. second A been it misstates assertion is court’s surely presume ed decision deny Commission to Fidelity Commission community opportunity has some telecommuni an petition to amend its aft local whole allocations The er needs.70 the Commission reformulated its cations (cid:127) perhaps FCC, the on based pleading for proposed of standards policy service”, “local concept of gramming Chapman issues in mythical Radio & view; issue Co., on (1967). Television 7 213 premised F.C.C.2d to which the area is whether The court advises us that since then it has inis fact is directed philosophy” Fidelity’s “found” survey “service ascertainment community. After local inadequate, Fidelity gain distinct nothing could in least, the evidence think I revising petition at from in light WEFM of survey local in original ascertainment Chapman since its survey was to is sufficient the Southland inadequate.73 of thus terests Commission did on that of fact issue approach, substantial not this course, raise take be of Commission A review question.71 cause the ascertainment survey was not specialized pro general on in in record. precedent Rather it per refused to conclus supports this hearings gramming Fidelity mit to revise its petition because interpreted Fidelity’s ion.72 petition re consideration as declaiming any desire to issue not consider does The court n original petition amend the and as noth Fidelity’s ascertain the relation ing more than a restatement of its sub program specialized survey to its ment argument stantive that an issue should content apparently ming proposal, have been set conclusion, down.74 This on deficiencies its affirmance rest however, extraordinary no less than survey though even Fidelity’s “finds” why would Fidelity since else the court’s in evi introduced survey was not at not it did Chapman if on it. seek relief held after hearing was no dence a relat least to affirm think it attempt petition could amend its does The court assigned Co., 70. fact, Broadcasting (1967); In later 8 F.C.C.2d 1036 Pol icy expressly Comparative meet Anaheim on UHF channel Hearings, (1965); Table of 1 needs of Southland. F.C.C.2d the local 397 n.9 cf. (1967). Broadcasting Co., Assignments, 736 The Brief La 8 Fiesta 6 F.C.C.2d F.C.C.2d 67- following general 19 74 cases, Communications Comm’n at with the for the Federal service Fidelity permit- Broadcasters, Community Inc., should not-be n.8& states 33 F.C. 714, 719, philosophy (1972); Inc., issue until it WSOQ, a service C.2d 720 to have ted 20 modify rulemaking petitioned (1969); City Camden, F.C.C.2d 875-76 had assignments. (1969); Regal But failure Broadcasting F.C.C.2d 412 table of surely by Corp., regard (1968). cured the Commission’s was F.C.C.2d See also assignment granting to Ana- Save WEFM v. own actions Comm. to 165U.S. Citizens Moreover, ruling on App.D.C. heim. Fidelity’s petition F.2d 280 & n.63 Fidelity (1974) (Bazelon, J., concurring result) did state C. wrong procedure to obtain a and authorities cited. had chosen philosophy and that Rather, it should issue service page - n.16, 515 petition rulemaking. sought may point page The court at this 696 n.16. alleged because dismissed general programming only referring to the separate local facts that thеre sufficient Fidelity. by proposed issue distinct from the re- the Southland needs of General, Inc., 74. F.C.C.2d Angeles service area. of the Los mainder It clarif. General, Inc., 5 F.C.C.2d 519-20 RKO (1966). decision the Review Board in this last was denying ac- clarification the Commission’s apparently adduced and evidence See the inadequacy Fidelity’s as- tion that Examiner, Hearing summa- accepted issue was first raised. In men- certainment General, Inc., 194- 44 F.C.C.2d rized RKO (after alleged inadequacy tioning all the survey record), was never in the ascertainment Howell, previous “findings” refers analysis the Review Board of Jimmie H. Compare the Sadow, inadequacy. provides Jay (1973); The Review Board no 1153-54 46 F.C.C.2d “findings” previous (1970); to such and there citation Harvit Broad 26 F.C.C.2d Jaco, previous spe- (1969); are none Corp., casting 18 F.C.C.2d programming See RKO issue. (1969); cialized Gener- Broad Christian 18 F.C.C.2d al, Inc., Ass’n, 5 F.C.C.2d Salter casting previously, indicated Chapman Fideli I am not and since comforta conform Chap perceive ble with this complied with conclusion not have no ty could possible until considering was not issued result that decision man system present original petition regulation.76 was de of broadcast after changes So, nied. more Far difficult problems are en allegations of ascertainment and law countered when one turns to the Com comply a chance to be denies scrutiny past mission’s pro of RKO’s Fidelity is not real it assumes cause gramming. case, In this RKO was reasoning This does comply. ly able to preference, awarded neither a or renew respect. our I con to command little expectancy al nor a demerit because of very least clude that past programming. Fidelity vigor given opportunity have been should ously challenges conclusion, this arguing light Chap in petition of to revise the evidence indicates that RKO man. given should been a substantial Implications B. First Amendment of past for demerit programming. This ev Program Consideration of Content prove tends to idence Fidelity’s of proposed grammed very Consideration little news or local af fairs, specialized programming engaged issue and also in excessive commerciali past performance program largely of RKO’s zation and utilized old movies making ming comparative a with dealing Channel crime and violence.77 I significant difficulty raises First Amend decision have no consideration I have problems. ment discussed those of excessive commercialization in the de cision whether grant to length previously75 in renewal problems at ex pectancy or a demerit.78 As for only the re tend here to outline the tentative of past mainder RKO’s programming, conclusions I have reached. The FCC I am constrained to may hold that comparative in a consider Commis may preference sion award a or particular programming pro whether a demerit on basis significant of a community amount unfulfilled of posal will meet an journalism actual by the licensee need and hence increase the overall di without regard journalism. to the content versity programming viewing of of I think this holding may premised this market. I take to be a rаther limit on those decisions erecting Fairness program ed of content and obli examination gation report to Fidelity’s one which is controversial consistent with issues importance.79 I public of am pres not specialized programming proposal. As I FCC, any weigh 75. See or in Citizens to Save demerit manner Comm. WEFM v. overcommer- against 191, 207, U.S.App.D.C. cialization 506 F.2d RKO. J., concurring (1974) (Bazelon, C. Communications, Inc., Public See 32 P & F result). Reg.2d (1974); Editorializing Radio Licensees, 13 F.C.C. Bazelon, generally supra Id. at 281-83. Cf. Greater Boston Television note FCC, U.S.App.D.C. 444 F.2d General, (1971) (on 77. See RKO L.Ed.2d 701 the “editorial (1969) Exam.) (Hearing part izing” journalistic function). which collects most of the evidence is relevant thinks course, enforcing Of such a standard of perform- past to a determination on RKO’s significant journalism amounts of the Commis issue, ance. On the commercialization see require requirements sion should strict supra. note 62 pleading percentage to ensure that differences programming truly among applicants relate FCC, community 78. See WEFM v. Citizens Comm. Save pleading require needs. These protect applicants & chilling will ments from the J., (1974) (Bazelon, concurring in the amorphous n.40 C. effect and unsubstantiated chal Bazelon, supra result); note at 229-34. It lenges and the costs incident defense there found on is not clear what Broadcasting of. See National Co. v. appear it does commercialization -, at -, 516 F.2d 1101 at 1156 (Bazelon, J., not award a dissenting did C. from the order informed, however, any justifi years five of seven term my ently 82 Despite competi of en the intense of the content review months.” for cation honor, Absent fur I am constrained to programming. tion tertainment Commission, I decision is so bad be from the agree. explanation ther award a proper substantive hold think the Commission’s cause I have wrong although basis. little ing a demerit preference — is un the fiercely that it is—but because the Commission’s doubt Since I remand mechanical treatment point, would technical clear on remand, the per On meritorious claims and consideration.80 further course, could, reasoning consider result-oriented com vasive entertain strip rationality which RKO’s off veneer pletely the extent unfulfilled attaching meets programming licensing ment contributes community operative needs and hence There is one decision. making compar diversity in the Commission’s decision. I part quote to overall expec Any (d) in full: “IT ORDERED: evaluation. IS ative necessity generated application General, of be of RKO tancies would That I realize of ... process comparison. of for renewal license by this IS Inc. imperfect approach to the . . an TO BE GRANTED .”83 this is DEEMED permissible expec superfluous. renewal opinion of the problem The rest tancies; perhaps wholly appropriate much more inclusive that the decid It program content is re was east Chairman ing vote Burch consideration of. securely grant sig simply quired in order concurred result. who It expectancy. simply I easy to renewal be alarmist about nificant would approach. decision, The I suppose know but that would do not the mаtter un presently ability has The same unwarranted.. bull rulemaking proceedi precedent in a through administrative der advisement doze Perhaps provide it will us ng.81 marks case for unwanted that dis be, sure, For in this difficult area. guidance will I am some tinction turned being, I this case should Perhaps think case against the time itself. it is this programming issue. forgetfulness capacity be remanded that enables right to motor along III. Conclusion I remain baffled and while amazed at comparative in these the turn of events Johnson, dis Commissioner Former suppose expect T I am naive to cases. “decision, grant that senting, stated anything different. application for KHJ— ing RKO’s Angeles, why I remain curious as to may very Los well be TV in But during valiantly so of this Commission labors affirm this worst decision court quality judgment), to indicate rehearing some granting seems vacating previous order recog 132-33. present F.C.C.2d banc). The Commission en Chap requirements. pleading such nizes Relating Formulation Policies 81. Co., 7 F.C.C.2d Television Radio & man Applicant, Renewal F.C.C.2d 580 n.64, U.S.App.D.C. - & (1967); , amended, (1971), (1971) 31 F.C.C.2d 443 man supra. n.64 721 & damus Citizens Communication Center FCC, U.S.App.D.C. v. 463 F.2d 822 Keep Progressive Comm. See Citizens (1972) . FCC, Rock v. 478 F.2d General, Programming Inc., Network In 82. RKO Comm’r, quiry, Reg. (1973) (Johnson, dissenting). P F Radio 20 & Hearing clearly weighed Examiner the al The Id. at But the Commission even vacil- “quality” programming, leged lack RKO’s issue, arguing on this lated later its deci- General, 149, 162-69, Fidelity was not a Television, sion final order. Commission stated Inc. “quality” though not consider even past performance also concluded RKO’s merely “average” (a conclusion which casting. of business.” The irration piece “foolish No financial issue put hearing process against ality down Fidelity. As I indicated publicized enough by previously, if certainly experience been lack of is a dis- Perhaps qualification observers.84 quite moderate Commission cer- —and not, opinion tainly this is not did repeat not, is of the suggest court did the irrational that it was even a “right might case” to correct demerit—we hearing process. away well do ity with the diversification original guides. “clarification” of Let The court’s the networks own all the licenses; suggests by repeated they as much opinion proven experience. obviously Hearing to what it has con The penchant references Examiner’s hyperbole as a li Fidelity’s integration weaknesses cluded factor ob- weaknesses that the scures the modesty censee. central of Fidelity’s proposal perceives express are that doubts have and the court statement in the 1965 raised as to candor and past been experience really philosophy” is all significant that its “service not integration in weighing the And, construct.” I never would course, “artificial factor. the court would be so un have believed Commission took a completely different litigant it. Both of tack fair to a before than Hearing did the Examiner in points arguing were not in issue before the these that the integration proposal of expressly FCC since could implemented. not be put Hearing refused to down an issue as to each. Examiner’s rhetoric has abso- lutely record on the candor absolutely With no no significance. decisional And аll spe or the bona fides of its the court’s enthusiasm for the Hearing proposal, programming cialized the court Examiner obscures the fact that the Ex- extraordinary conclusions. The aminer leaps to recommended that the license be patterned granted issue was philosophy” Fidelity. “service to directly prior on a decision. Commission Fidelity The court’s characterization of whether it fits the may disagree on We pattern, “nothing” applicant ap as a constitutes although there never was a parently flailing a effort to avoid what out, hearing to find but to name an clearly dangerous precedent in com requires “artificial construct” more parative hearings. The ironic truth is righteousness than I and certitude can that the court clutch at such need not pertains summon. candor issue to straws since we can be sure Commis Fidelity’s alleged failure to inform the manage sion will to erect some ethereal that some of its stock sub prevent distinction of that will this case scription agreements signed by were becoming precedent it from in non-re subscriber; agents Fidelity’s and newal cases. But alleged failure to inform the Commission Fidelity court’s as a characterization of changes corporate of certain made in its “nothing” applicant question raises the nothing, absolutely structure. We have my mind as to what the court would nothing, in this record to indicate that “something” applicant. desire from a they either existed more Fidelity important Here has an diversifi than technical or clerical errors. The advantage cation which it seeks to trans that the Commission refused to set fact specialized programming pro late into a point certainly an issue on the down tells posal; modestly integrate it seeks to something substantiality us about the of ownership management into and is local court’s new found candor issue. ly appears owned. It me that this is exactly application the kind which we Hearing points court also indeed, “something” should find to be describing language colorful Examiner’s truly highly new voice concentrat experience in broad- lack of Proposal leading Geller, Modest authorities cited which include Profes- A Modest 84. See Jaffe, Friendly, Judge Com- sor Professor Jones and Communications the Federal Reform of panel mission, decided a member of the this case. 63 Geo.L.J. may There be cases in which the industry. Appar ed telecommunications properly Commission can ex- ently requires experience the court find that in or perience resulting applicant’s from an “something” der for the ownership of communications facilities again again but as I have said elsewhere, competing applicant’s offsets a free- this statement primary ownership from emphasis past dom of other commu- experience will fore nication interests. But stall new ‘Commission broadcasting entrants into the before, expertise support piv- alone cannot so field. And as we have prior said (a divergence)’ otal experience from basic commu- broadcast unlike cоncentra philosophy. convincing A nications planation ex- tion of Perhaps control is remedial.85 required. importance Fidelity’s application apparent would be more to the court if I do not think either the court or the Fidelity had included members of minor explanation. offers an such ity groups among its stockholders.86 The all regaled Rather we are with the ad- court antagonistic seems be vantages experience and all the ad- proposals promise much, cause its as if vantages of quietly diversification are very making promise suspect, of a securely swept rug. under ploy a mere swipe an incumbent’s battle, repetition As the last license. But Fidelity has no alternative of it will be won or ap- lost future promise but to since it ais newcomer. pointments to the Federal Communica- Once place more the court seems to an tions Commission ap- and whether those premium excessive past broadcast ex arrive, pointments early like those in the perience. 1960’s, with a desire to reduce the con- opin court’s makes the Perhaps what centration of control of telecommuni- the realization me is difficult for industry. so cations say ion But what do we diversification between this debate the owners of in the meantime? of a repetition experience is past question merely personal. This is not fought thought been I battle judicial techniques Reliance on of rea- years seventeen long ago. In won judgment soned to the comparative lends thus: I criticized the Commission past, process expectation of ration- ality predictability. Perhaps and naive- attributing . I think ly, the owners of relied on that concentration by-products of to these expectation spent good deal of degree experience] greater g. past [e. process money in the of that reliance. it attributes than importance too, Fidelity, “challenge is entitled to its traditional, preference antipodal, expectancies” aof fair and rational com- ownership of for decentralization parative process. simply I cannot be- communication, the mass media lieve that serious students of communi- effectively nullified policy cations expec- would conclude that anti-monopoly the diversification tation has been fulfilled in this case. recognized as ‘one of long since policy injustice This me leads to further underlying considerations the basic question ought give up whether we the Communications enactment of pretense that the evalu Act.’ FCC, zelon, dissenting). Broad also Pinellas 85. Sunbeam Television v. 100 U.S. J. 236, 82, 26, FCC, U.S.App.D.C. 230 App.D.C. casting v. F.2d 29 n.6 Co. 1007, denied, 204, 76 S.Ct. U.S. cert. F.2d Compare FCC, v. Garrett 168 U.S. arguments 650, 100 L.Ed. 869 266, 9, (1975); App.D.C. 513 F.2d 1056 TV seemingly my two cases these dissents FCC, 349, Inc. v. 495 F.2d .by in its State adopted 986, denied, cert. 419 U.S. Hearings, Comparative ment 245, 42 L.Ed.2d 194 (1965); Haute Terre see 394-95 Television, FCC, 87. Tennessee Inc. v. 104 U.S. Broadcasting Corp., App.D.C. (1958) (Ba 262 F.2d supra. notes 1297, Cong., casting, H.R.Rep. 2d No. 85th 447 F.2d at 1214. Barnett, (1958); Sess. 559-75 Cable Television at 1213 n.36. Id. Concentration, I, and Media Part 22 Stan.L. Co., Broadcasting significant 25 F.C.C.2d (1970). grant Haute 28. Terre 221 Failure to Rev. 348, (1970); advantage on Com weight in a com 353-55 to a diversification 393, Hearings, parative 1 F.C.C.2d parative en would tend to 1, Inc., WHDH, F.C.C.2d (1965). 16 present pattern See 394 of concentration trench this aff’d, (1969), recon., 12-13, potential 856 by eliminating prospect 17 F.C.C.2d on control competition FCC, 143 v. edge Television Boston the market. Elimi Greater U.S.App.D.C. on 841, (1970), 383, F.2d 859-60 “edge 444 one fac of this effect” has been nation 2229, 923, denied, 29 heavily 91 S.Ct. weighed 403 U.S. cert. in more recent tor that Community (1971); Broad Lorain 701 L.Ed.2d casting case law. See United States v. Ma anti-trust Co., 602, recon. de Bancorporation, 13 F.C.C.2d 418 U.S. 623- rine denied, 604, nied, rehearing 15 2856, (1974); 41, 41 L.Ed.2d 978 Unit 94 S.Ct. denied, (1968), F.C. 18 review Brewing Corp., 388 F.C.C.2d Falstaff 410 U.S. ed States v. 526, 532-37, aff’d, Broadcasting, (1969), Inc. 1096, Allied 686 C.2d 93 35 L.Ed.2d 475 68, FCC, U.S.App.D.C. F.2d inspects v. cited. If one advertising and sources Broadcasting Corp., 11 (1970); Angeles viewing Ultravision market Los WEBR, aff’d, (1968), Inc. (on daily newspapers 410-11 F.C.C.2d this defini for VHF and FCC, U.S.App.D.C. F.2d 158 market, Multiple see Own tion of the relevant ership FCC, generally Standard, TV Inc. v. See FM and Broadcast Televi 1046, 1056, 1077, Stations, F.2d sion (1975)), one finds seven VHF television daily newspapers, L.Ed.2d 194 a total of stations and two competitors. Elimination of the threat of nine potential Hale v. 29. See competition from a market struc (1970) (Tamm, J. concur 562 & n.2 surely fall within in this manner tured Bennett, and the ring); Media Concentration “edge previously cited the cases the rule of effect,” Lens, Focusing Seven with a Section FCC: potential although the elimination also R. Nw.U.L.Rev. merger competition in a con does not occur McGowan, Noll, As Economic M. Peck & J. text. 15-16, Regulation pects of Television Interstate and For House Comm.

Notes

notes sources cited ation is a review, process rational we will at least be aware of the but is instead “legislative” type choices we face in this difficult area of may be made on the policy, implicating basis of both the values of reasons or reasons, no perceived dimly protection small business and free en or not at all terprise competitive system.89 in a And by the decision-maker.88 If we fail to thereby displace any expecta we will take this approach yet continue to rationality possibly tions of held chal affirm cases such as the one sub judice, lengers and applicants alike. leaning together we will Any approach may give us the illu shards of a building rotten through the well, may sion that all is that the choices legitimation appellate ‍‌​‌​‌​‌​​‌​​‌‌‌​‌​​‌‌‌​​​​​​‌​​‌​‌​​​​​​​​‌‌‌‌‌​‍review. If we present within the rational handled adopt with approach compatible more structure, know, when in fact we from present the Commission’s posture and least, this case at that no such rational give up the illusion of serious appellate structure exists. differ, FCC, experience Broadcasting often dictates 97 U.S. v. Pinellas Co. changes. . '. . All such matters are for App.D.C. Congress and the their L.Ed. executive and agencies. high J.): They political, (Prettyman, (1956) They sense of that abused term. are not for comparable se- [sic] factors in decisive judiciary. vary may . And it is . . well lections view of the Commission’s also true Compare Broadcasting Carroll Co. may public interest best what 258 F.2d 440 change Commissions time to time. from U.S.App.D.C. pages ---, underlying philosophies change, themselves pages 711-717, supra.

Case Details

Case Name: Fidelity Television, Inc. v. Federal Communications Commission, Rko General, Inc., Intervenor

Court Name: Court of Appeals for the D.C. Circuit

Date Published: Jun 30, 1975

Citation: 515 F.2d 684

Docket Number: 73-2213

Court Abbreviation: D.C. Cir.