*1 ex- legitimately NTCs, er, possessed and FCC by the rules our Act or nications to en- discretion considerable ercised its similar raise issues violations even if such policies and (i.e., transaction its affiliate force proceeding in this presented those province courts’ and im- It is not the rules. by affiliates overcharges alleged pur- agency’s decisions reached transac- disturb accounting for affiliate proper Since we at to that discretion. FCC reiterated suant tions)”). for the Counsel merits are not to review empowered claims other argument oral decisions, and since we obli- was still FCC’s enforcement foreclosed, and that violations, petitions procedural complaints. See find no those gated to consider review are 207-209. U.S.C. §§ FCC, the settle- Thus, according to the Denied. proceedings only impact ment’s § the relief extent “to the would be received been seek

complainants decree, consent terms of the

through the facts additional must show

complainants to obtain further harm prove greater Order, Reconsideration

relief.” 26). As (para. at 3306 F.C.C.Rcd. argument, at oral explained FCC’s counsel LIMITED BROADCASTING WEYBURN complaint files who any ratepayer PARTNERSHIP, Appellant, re- already have NTCs will against De- the Consent some benefit ceived recovery would cree, any additional and so COMMUNICATIONS FEDERAL that benefit. reflect offset to have to be COMMISSION, Appellee, recover, howev- might complainant still beyond damages above er, River Communications Decree, Consent compensated those Corporation, Intervenor. stemming from exces- damages including 91-1383, 91-1378, 91- Nos. read- share this purchase prices. We sive and 91-1411. respects Decree, which ing of Consent knowing the NTCs both the interests Appeals, States Court United De- in the Consent settled that the issues Circuit. District of Columbia “settled,” fact, and the statuto- are, in cree 4, 1992. Argued Nov. complaints to file persons third ry rights of warranted, and, where 12, 1993. Feb. Decided relief. obtain April Rehearing Denied III. CONCLUSION settlement, agency what every Not occurs, es it whenever or

ever terms instance, Chaney. For under capes review an enforcement agency’s initiation obli substantive may trigger certain

action statutes, agency’s

gations under judicial trigger might

violation of review, U.S. Chaney, 470 see agency’s consistent

S.Ct. ex might be “so

policy of nonenforcement of its to an abdication

treme as to amount at 833 n.

statutory responsibilities,” id. case, In this howev- at 1656 n. 4.

105 S.Ct. *2 a financial

The FCC resolved River’s favor and declined issue in James hearing, issues for in- designate other MD, Frederick, Colby, A. Lauren River’s structure cluding whether James *3 Berfield, John J. Schau- L. Morton whom misrepre- party-in-interest, a hid the real Rini, Kravetz, and J. ble, Robert Eric S. issue, and a character and candor sentation DC, Beller, Washington, were E. Michael appellants entitled to Because issue. brief, appellants. Morton for joint on the Administrative Law before an a Schauble, Washing- J. L. Berfield and John issues, (“AU”) Judge several of these for separate brief ton, DC, filed also to the FCC. we vacate and remand Broadcasting Limited Weyburn appellant Partnership in No. 91-1378. Background I. Counsel, Cook, whom with L. Roberta Counsel, Daniel Pettit, and L. Gen. Robert Regulatory A. The and Statutory Counsel, Armstrong, Associate Gen. M. Framework Com’n, Washing- Communications Federal objec- primary The FCC two identifies brief, appellee. DC, for ton, on the governing its selection of licensees tives Zipursky, and Diane J. Bodorff Richard 1) achieving stations: for new broadcast appearance DC, Washington, entered public, to the practicable service best River Communica- intervenor James 2) ownership mass com- diversifying Corp. tions Policy media. Statement on munications Hearings, 1 Comparative Broadcast MIKVA, Judge, and Chief Before (1965) (“Policy State- F.C.C.2d RANDOLPH, Circuit SENTELLE ”). addressing objective, the first In ment Judges. weight to gives substantial ownership and man- integration of station by filed Circuit for the Opinion Court evaluating agement. When Id. Judge SENTELLE. applica- each applications, the awards Judge by Dissenting opinion Chief filed integration pro- credit quantitative tion a MIKVA. ownership proposed portional by day-to-day managers. For ex- station SENTELLE, Judge: Circuit manager owns a ample, proposed if a 50% Broadcasting Limit Appellants Weyburn applicant re- company, the interest in the B. Barbara Partnership (“Weyburn”), ed quan- This integration credit. ceives a 50% Limit (“Benns”), Broadcast Future Benns qualitatively enhanced if credit is titative WKIE-FM, (“Future”) Partnership ed certain other integrated possess owners (“WKIE”) Federal seek review Inc. status, characteristics, minority lo- such as (“FCC” or Commission Communications residence, and broad- participation, civic cal “Commission”) granting a con decision experience. at 395-96. cast Id. FM radio station permit for a new struction applicants Richmond, years many In have Virginia, to recent 266A on Channel corporations partnerships used limited Communications intervenor James River for rais- River”). non-voting as vehicles (“James Weyb with stock See Corporation ownership struc- Partnership, ing capital. type This Broadcasting Limited urn applicant under 1989) (“Initial handicap an (ALJ Deci ture could F.C.C.R. 5310 manage- (“Remand ownership (Rev.Bd.1990) “integration of sion”); 5 F.C.C.R. 861 if (ALJ 1990) example, For der”); ment” criterion. 80% 5 F.C.C.R. Or by Decision”); shares were owned limited partnership’s 6 F.C.C.R. (“Supplementary (“Board only remaining would be partners, (Rev.Bd.1991) Or 20% 1266-68 management. (1991) (“Commis integration with der”); available for integration credit would Order”). appli quantitative A Appellants, competing 20% sion pro- station, comparative rarely win a broadcast raise numerous for the new cants ceeding. recognition of the value application. challenges to James River’s non-voting Application B. The stock partnerships and limited raising capital, the FCC as vehicles equity McDaniel has a in- Claudette 20% pas- ownership interest disregards the River, voting is its sole terest appli- computing investors when sive shareholder, proposes to work full time This integration credit. quantitative cant’s Manager. remaining as General 80% doctrine, after Anax known as the Anax is initially by equity interest was owned Dr. Inc., 87 F.C.C.2d Broadcasting Cynthia Charity, Dr. Charity, Renard Thus, equi- (1981). applicant’s if of an 20% later, Kyles. During pen- Dr. Michael pro- general partner who ty owned proceedings, Rob- dency of the consolidated time, and manage the station full poses to Fish, competing applicant ert a former who *4 inves- by passive owned the other 80% in stations Rhode Island owns broadcast tors, inte- will applicant receive 100% the Kentucky, acquired all of the shares of and gration credit. Charitys Kyles. River’s fi- the and abuse, ex Commission To minimize upon a nancial certification was based loan two-tiered partnerships amines limited Virgi- commitment letter from the Bank from corporations to bénefit seeking stock passive were, nia when the doctrine, determine Anax investors, National and a letter from Fleet reality exert nominally passive investors bought Charitys’ Bank when Fish control over the significant influence or shares. Corp., 102 applicant’s business. KIST (1985), 288, n. 5 mem. F.C.C.2d 290 aff'd evidentiary hearing, the After an AU Telecasters,

sub United American nom. integration River a awarded James 100% (D.C.Cir.1986), FCC, v. 801 F.2d Inc. 1436 for pursuant credit Anax doctrine 2182, 1050, denied, 107 481 U.S. S.Ct. cert. proposed employment full time McDaniel’s (1987). “passive” If a own 95 L.Ed.2d 839 Manager of the as General station. applicant’s actively participates in the er quali- application also substantial received affairs, all of attributes Commission enhancements for McDaniel’s contin- tative as active “passive” owner’s interest (the forty-year Richmond uous residence calculating integration credit. interest license), her extensive in- community of 7063, Broadcasting, 5 F.C.C.R. Royce Int’l (she civic activities volvement Richmond (1990). 7064 Council), City previous her on the served licenses for new broadcast Applicants (she hosted a ra- experience broadcast “fi they are must also demonstrate that show), minority and female dio talk her 308(b) nancially qualified.” 47 U.S.C. § attribut- had no Because McDaniel status. (1988). Northampton Media Assocs. See interests, no River had media able (D.C.Cir.1991). To F.2d 1214 941 the “diversifica- offsetting under demerits applicant “financially qualified,” an Decision, criterion. Initial tion of control” of suffi must have “reasonable assurance” 5338-39, 5340; Order, Board 4 F.C.C.R. at the sta financial resources to build cient upon these find- Based 6 F.C.C.R. at 1266. three operate it for the first tion and AU, Board ings, the the Review months, revenue. relying on station without all concluded that James River Commission Qualification Standards Financial for applicant. superior comparatively 69 F.C.C.2d Applicants, Broadcast Aural 5340; Decision, Sup at 4 Initial F.C.C.R. (1978). simplified 407, In 1981 3812; Decision, plementary establish applicants which the manner Order, qualified. Appli Commis they financially F.C.C.R. Order, to docu may certify, opposed as at 4474. cants now sion F.C.C.R. ment, al qualifications, requirements have

though the substantive Proceedings C. Administrative changed. Florida Broad See South held a In March consoli- (1983); Co., casting 94 F.C.C.2d Joseph Chachkin (P dated before 301, Rad.Reg.2d & Form Revision operate applications ¶ (1981). involving thirty-five F) 381, at 6 allegations concerning Desig- Hearing See FM station. the new vouchers false reimbursement submitted 87-1213, Sep- released Order, DA nation expenses as illegal per diem and received Appendix in Joint reprinted tember of Correc- Virginia Board member of the unsuccessful Only four (“J.A.”) 1. newspa- a series tions. The second appealed. applicants inves- police on reported per articles During Hearing. 1. The Consolidated took trips McDaniel concerning tigations AU to petitioned Benns hearing, on while she City Richmond for against James issues add financial concerning a lawsuit City Council by Do- against lawsuits based decision City Richmond Council’s approximate- of Richmond minion Bank salary be- $1,000 from McDaniel’s dock Corpo- Credit by Commercial ly meetings never attended cause she Also, $9,000. Fu- approximately ration for reimbursement obtained which she Issues” Enlarge a “Petition ture filed there was testified city. McDaniel lack of misrepresentation requesting investigation and police any official fi- regarding James issues candor salary awas dispute over qualifications, statutory nancial, legal and members council fight between political certification, party-in- and real ownership *5 of court. out resolved had been contended Future’s motion interest. 111-12; 151-52. J.A. Dep. Tr. McDaniel of designation after the occurring events is- to add motions denied both The AU comparative applications the Order, Opinion and sues. Memorandum concerning the contin- questions had raised 1988, April 88M-1121, released FCC Virginia’s loan of the Bank viability of ued Opinion and Or- 6-8; Memorandum J.A. finan- letter, of the thus commitment 89M-860, released March der, FCC appli- of the James cial Benns’ AU denied 9-10. The J.A. cation. over the lawsuits regarding financial issue after weeks several September In loans because unpaid bank McDaniel’s hearing, for a set applications had been the repaid prior lending institutions “both building under construc- suits, center a medical motion and filing Benns’ of major in- Charitys were tion, in with- money were of the for collection killing a vestors, collapsed, construction McDan- drawn,” rebutting questions about deposition in a McDaniel testified worker. stability. Memorandum financial iel’s the Chari- that she concerned became 89M-860, 2; Order, Opinion and FCC problems,” financial tys had “tremendous request Future’s rejecting 10. In J.A. investors. for other began to look issue, AU declared a financial 132-133, 136; J.A. 153- Dep. Tr. McDaniel any evidence offer failed Future had attorney Meanwhile, River’s (a) 55. between “showing causal link a representing James from impact had withdrawn of this collapse building over not been he had River because wherewithal upon the financial event alleged $9,000 Charitys’ legal fees. financial (b) Charity and between Drs. reported to Bank Charity and the problems financial the Drs. posture of Ms. Clau- Virginia and its “reasonable of Virginia’s the Bank loan commitment Thus, deemed never amended. AU letter was assurance” dette McDaniel.” change in any misrepresentation informed financial Future’s FCC was Memorandum support.” Fu- qualifications. “wholly financial without James River’s 88M-1121, Order, FCC to section Opinion and pursuant ture maintains that rules, had a 7. J.A. FCC’s 1.65 of the these

duty report events Re- With Exceptions Filed 2. support for the James to withdraw exceptions to filed view Board. application. with the FCC Initial Decision the AU’s filed “Petition also Review Benns pieces of evi- Board. two also introduced Future the Is- Enlarge Reopen the Record in- about McDaniel’s raising dence doubts determine River” to Against James sues magazine article tegrity. The first was any that matter inquiry to allow into fused her vote on had sold whether question whether McDaniel in order to secure or into City Council Richmond River’s parties for James loans third original financing had solicited Riv- money and to determine effort to obtain she lacking in candor when application. prosecute McDaniel was er’s bills sur- concerning circumstances discovery testified evidence Even after uncovered of James rounding procurement $6,000 hearing paid the that McDaniel had Criminal original financial commitment. office, at a Union fee cash Western by the against McDaniel filed warrants inquiry refused to allow into spe- attorney Richmond commonwealth payment. The or destination of the source received the alleged that McDaniel cifically any inquiry about AU also disallowed $6,000 from Renard loan first $2,000 to Charity Renard loaned when Dr. in favor of an she voted Charity before McDaniel. construction of allowed the ordinance Charity building in which medical office Enlarge Further Motion to a. Benns’ interest. See unspecified had Issues J.A. Candor Misrepresentation/Lack i. re- the issues Board denied The Review discovery had though scope Benns, Even concluded substan- quested AU, by the Benns severely had questions of fact been been restricted material tial and Issues,” viability Enlarge continuing concerning the filed a “Further Motion raised proposal. requesting issues to determine whether James River’s factors that misrepresen- number of principals noted a James River’s con- peti- about James River’s questions raised candor. facts and lacked ted *6 including: qualifications, “smoking gun,” financial tion, tinual to a Benns referred allegedly collapse which building Charitys had showing that ledger harm; Charitys caused certificates stock signed and received Virginia’s letter of of the Bank 1985, status 11, but did up on drawn December a loan to James assurance of reasonable purchase price per pay share $1.00 law- collapse; the two bank River after 2, later, December year until almost McDaniel, may have against which suits signed let- Charitys earlier 1986. The had pay the unable to indicated that she was promising for subscription ters of applications; prosecuting expenses of receiving them. upon the shares River’s FCC of James and the withdrawal during deposi- also note that fees, indi- legal nonpayment for counsel hearing, McDaniel original tions and at to meet cating River was unable James conflicting of when accounts gave three re- expenses. It therefore prosecution the certifi- signed and for paid a further to the AU for manded the ease conflicting sto- gave McDaniel also cates. (1) whether on two issues: paid for her shares. and if she ries of when continuously financially had been 1988, 19, January deposition on At a applications, and it filed its qualified since certificates that the stock McDaniel stated (2) had violated sec- James River meeting held in her aat were distributed rules, 47 tion 1.65 of the Commission’s December in Richmond on attorney’s office (1991), failing report 1.65 C.F.R. § 7-8; 143-44. Dep. J.A. 11, 1985. concerning its finan- material information clear, than less Although McDaniel was qualifications. cial stock at paid for the implied that she she Proceedings 3. Remand Before certificates issued that time. stock discovery was On remand further ALJ. non- “fully paid and they that were stated hoped prove that after Benns taken. J.A. 443-54. assessable.” River, in James Fish a shareholder became 18, 1988, at the consolidated March On some of personal use McDaniel diverted previ- her hearing, McDaniel contradicted deposit into the money Fish sent to the Decern- however, testimony respect AU, re- ous corporate account. The Benns support her application. request, To testified that 11, meeting, and ber McDaniel has executed that pointed certificates out brought the stock had runner covering her day, Fish that notes with her, promissory for the stock paid that she which corpo- expenses, the various signed all share that she give only Hear.Tr. in Fish’s allegedly that time. run favor rate documents leverage said she was McDaniel. extraordinary She also over 1301; 112. him J.A. for their stock of confes- Charitys paid signed a series McDaniel also certain the dated Decem- payable to Fish for sion-of-judgment certificates notes the stock before $3,829.99, Hear.Tr. 11,1985 $2,960.45 to them. fall $20,000, issued ber 1300; days after a entirety only three J.A. in their due pro- application, and grant of James that showed produced Documents any time call the *7 application Agreement of was a there Memorandum instead pay. He concluded intention not to positive- and Fish which between McDaniel of a subscriptions were evidence authority to exercise ly denied Fish weight of pay and that future intent Id. at J.A. control. decisional shareholders established that the evidence defaulted even if McDaniel ALJ stated that paying, and times committed were at all notes, deprive her of would on ex- applicant’s pay, willing and able sole right to continue as James her importance He also discounted penses. voting shareholder. account in McDaniel’s discrepancies of attributing them to payments, of her stock Summary Deci- For Benns’ b. Motion Opinion memory Memorandum lapses. sion 90M-1737, June released Order, FCC 20, 1990; J.A. 54-59. adduced upon the evidence Based Benns depositions, through discovery and Control/Real

ii. Financial summary against decision James moved for Party-In-Interest grounds in her three asserted River. She First, against James River. of a motion addition requested the Benns also cost that it would had estimated to address party-in-interest” “real $200,000 prosecute approximately improperly con- an had been whether there did not application, but she James James of control of cealed transfer to how an as “a idea Fish, is have even shadow Fish and whether from McDaniel Second, might monies be raised.” these James River party-in-interest the real Rulings. The timely 4. Review the ALJ’s did not River’s shareholders Board the AU’s stock, never FCC’s Review affirmed pay for their reporting resolution of the financial subscription obli- her stock fully honored integration award- of issues and 100% Third, point the at one gation. Order, to James River. Board credit their share of pay refused (Rev.Bd.1991). The Review to F.C.C.R. fee, McDaniel failed hearing or materi- agreed that no substantial Thus, matter as a inform the Commission. concerning questions al of fact remained law, argued, River had Benns qualifications, River’s basic qualified James continuously financially been evidentiary hearing deemed un- so an filing its since applica- each filed necessary. failing to re- 47 C.F.R. 1.65 violated § Commission, full concerning fi- tions for review with the its port material information denied, affirming thereby which the FCC qualifications. nancial decision. the Review Board’s Commission motion, Weyburn denied Benns’ The AU (1991). Future, Order, 6 F.C.C.R. 4474 No. Partnership, Broadcasting Ltd. timely ap- all Weyburn, WKIE and Benns (A.L.J. 90-1738, op. released June slip -Their cases were pealed to this Court. prece- 1990), concluding that under FCC Weyburn separately appeal- consolidated. dent, found finan- applicant cannot be cred- integration denial of full ed the FCC’s if, here, are legal fees cially unqualified as claiming the application, it Commis- from a current and rendered arbitrary capricious sion acted upon for con- than relied source other manner, precedent, and failed to follow operating costs. The AU' struction inconsistently with James Weyburn treated consis- River had made noted that James to defend James River intervened River. prosecu- payments for tent and substantial actions. the FCC’s paid-in- current and expenses and tion had not failed expenses on such and so full II. Standard of Review prosecution expenses. He dis- to meet its discussing the issues raised Before timing pay- concerns about the missed pause clarify the stan appeal, in this we “entirely irrelevant” ment for the stock as applicable in our evaluation of review dard subscription agreements the stock because of the Commission’s actions. pay a commitment to for stock “evidence respect date.” at 3. With some future Id. provides: Act The Communications fee, hearing AU concluded ques- and material If a substantial ... Charitys’ that McDaniel insistence [by presented a covered tion of fact is expenses simply reflected their ..., application for an FCC [the license] pro that she rata share desire formally designate the shall Commission] they disavowed expenses and that ground application for *8 their own commitment 80% hearing obtaining.... Any then reasons share. upon such subsequently held appli- in which the hearing

shall be a full Summary c. James River’s Motion parties interest shall cant and all other for Decision participate. permitted be 309(e) (1988). recently elu- We granted River’s Motion' 47 U.S.C. The AU James § designating Decision, for resolving cidated the Act’s standard Summary after for hearing in David Radio building col an issue for Ortiz Charitys’ questions about (D.C.Cir.1991). commitment, FCC, 941 F.2d 1253 Virginia Corp. v. lapse, the Bank of a McDaniel, the FCC will hold pay There we said against and the lawsuits “[b]efore clearly and dispute be hearing, Riv must prosecution expenses James ment of factual, alleged, it be and adequately must Summary De Supplementary er’s favor. and to the level of a substantial Judge it must rise Law Jo cision Administrative (internal quo- (ALJ Chachkin, issue.” Id. at material seph F.C.C.R. omitted). We review 1990). tation marks appellants had FCC maintains that en. The of whether determination FCC’s wit- opportunity to cross-examine ample stan- the deferential under warranted Act, deposition. Procedure nesses at of the Administrative dard (1988) (agency actions 706(2)(A) 5 U.S.C. § remanded, financial issue When the an “arbitrary, capricious, set aside if to be allega- a number of did evaluate the AU not in discretion, or otherwise abuse of relating River’s financial to James tions law”). with accordance granting James Riv- Before qualification. Decision, the Summary AU er’s motion for III. Financial Qualifications and reached the several issues considered argue first that following conclusions: River that James incorrectly determined Charitys’ (1) collapse Whether Ap qualified. financially continuously financial building caused them medical raise fi attempted to pellants repeatedly harm, affecting the financial adversely issues, the ALJ qualification nancial Applica- qualification of the James in the con add a financial refused to building col- concluded the The AU tion. Review hearing. The FCC solidated on the financial lapse no adverse effect AU, the issue of James added reversed Charitys. Supplementary ability of the remand qualification, River’s Decision, J.A. 64. additional the AU for proceeding to ed the not, however, hold hearings. The did AU Virginia’s letter (2) the Bank of Whether rather, he granted hearings; any new of a loan to James assurance reasonable Summary Deci Motion James River’s by adversely affected finan- had been discovery. The Review sion after further by hardships suffered as- cial were satisfied Board and Commission building collapse. with the sociated the AU’s resolution Virginia letter concluded Bank remand. question on We force from the remained valid full not. day Robert Fish day it issued until the Charitys’ building acquired the stock. noted, for a broad applicant As an Charitys’ net worth was insured it is must demonstrate that cast license support all times sufficient was at eligible for it is financially qualified before loan, Bank of in the as outlined Northampton Me license. broadcast Id. Virginia Letter. (D.C.Cir. F.2d 1214 dia Assocs. applicant 1991), would we held that against filed (3) the lawsuits Whether if at the financially qualified considered Corpora- Credit by Commercial it “has reasonable of certification time of Richmond by Dominion Bank tion and necessary funds evidence that reliable part to inability on McDaniel’s indicated Id. be available....” would prosecuting pay expenses that the two application. AU found reasonably that it acted argues The FCC paid in full against lawsuits qualification issue resolving the financial McDan- did affect withdrawn conducting without River’s favor in James financial com- ability to meet iel’s 20% hearing. The Commis- evidentiary a full Before the Chari- River. mitment grant an AU rules authorize sion’s Fish, McDaniel tys’ were sold to shares summary decision when motion pro share actually paid more than her rata affidavits, materials obtained pleadings, *9 expenses, and after Fish prosecution of the admissions, mat- otherwise, discovery or shares, Charitys’ purchased the noticed, show that there officially ters through the a commitment maintained fact.” to material genuine “no issue as pay of signed she promissory notes 20% (1991). 1.251(d) C.F.R. 47 § 3813-14; expenses. at remaining Id. that on remand The FCC maintains 64-65. J.A. all parties to adduce permitted of James (4) the withdrawal Numer- Whether documentary evidence. relevant nonpayment counsel River’s FCC depositions allowed tak- also ous were

1229 legal that ap- McDaniel estimated costs of inability indicated an legal fees prosecuting application the James River prosecution ex- meet its part to plicant’s $200,000. partners, One of her would be concluded withdraw- The AU penses. Charity, thought did not that he it counsel Renard testified River’s FCC al James $50,000. Charity Dep. 20, ex- R. inability pay prosecution cost would indicate an 38; 199, legitimate question made con- A applicant had 201A. J.A. penses because prose- payments in James substantial arises as to whether investors sistent and paid- meeting current expenses was had come to a minds cution J.A. expenses. Id. prosecuting applica- in-full on such the costs of its about particularly relevant because tion. This is guaranteed by the it was a line of credit the AU con- findings, upon these Based Charitys that for James Riv- was basis continu- River had been that James cluded qualification.1 er’s financial the date of financially qualified from ously and that James filing application, previously disqualified ap- The FCC has report- the Commission’s not violated plicants who not have clear and worka- do that The AU stated ing requirements. plans. example, For in ble financial Las had “the opponents River’s although James Communications, Inc., 61 Rad. Americas perti- all witnesses with deposing ¶ benefit (P 1008, (Rev.Bd.1986), Reg. F) at 10 & “volumi- and had access to nent evidence” permit the FCC held that all construction evidence, mighty documentary nous applicants required to have written even a shred failed to uncover labors have of certification documentation time qual- financial to James River’s of doubt as anticipated and their showing actual costs The AU F.C.C.R. at 3814. ifications.” 5 Although plan to meet those costs. genuine no issue of material held there was FCC has stated Las Americas and that a sum- fact left to be determined by Northampton “effectively overruled” mary decision in James River’s favor (ALJ 1988), Assocs., 3 F.C.C.R. 570 Media mandated. Id. therefore (Rev.Bd.1988), rev. affd, 3 F.C.C.R. 5164 (1989), denied, 4 5517 we stated F.C.C.R. in this the AU We conclude that that this “does not meet Northampton wrong. Although FCC has sub “[t]he obligation provide Commission’s basic acting discretion in on a motion for stantial change prac explanation for its reasoned decision,” Radio summary David Ortiz v. Northampton Media Associates tice.” 1253, FCC, Corp. v. 941 F.2d 1258 1214, (D.C.Cir.1991). FCC, 1216 F.2d (D.C.Cir.1991), troubling questions substantial United Communication See concerning fact remain material Office of 803, FCC, 911 F.2d Church Christ continuously financially River was I, (D.C.Cir.1990); Inc. v. out, Alegria First, appellants point qualified. as 471, (D.C.Cir.1990). We F.2d 474-75 prior filing McDaniel testified case. In Northampton did remand the had a that she written ease, FCC declined although the plan, plan legal excluded who did not have point disqualify applicant engineering costs. At one (1983); Rad.Reg.2d Zia ignore long casting, 46-47 we "a line 1. The dissent asserts that Inc., Tele-Communications, decisions, by 50 F.C.C.2d of FCC cited the AU below and court, (Rev.Bd.1974).” Dissent at 1235. agency again 187-89 raised before this holding projection of total permitted financial those cases expenses not be taken into account need legal and other fees plans include that did not determining applicant’s ability expressly noted that prosecution expenses, but operate proposed Here, construct and station legal fees they paid as incurred. applicant willing Further, where an has shown herself cases none of those were in arrears. expenses and able to such on a among current disagreement was there evidence Radio, Family ap- See Port prosecuting basis. Huron 5 F.C.C.R. principals cost of about the (1990); Northampton Media Associ- plication. ates, (Rev.Bd.1988), appli- proposition supports review None denied, (1989), ongoing prosecution costs 4 F.C.C.R. 3858 on other cant’s failure aff’d *10 evaluating grounds, Northampton Media Associates v. into account cannot be taken (D.C.Cir.1991); applicant. F.2d qualifications 941 1214 of an Muncie Broad- financial 1230 Charitys and the 1985 in December issued its certi- support hand documentation During that their stock. finally paid for qualified, financially it was that fication unpaid went bills time, corporation’s reliable and reasonable other was “there non-payment. attorney available.” withdrew be would and funds that evidence River holding in North- shows James this believe 1217. Our F.2d 941 at De- proposition qualified between financially for the stand not not ampton does was finan- have have to 1986. do not and December applicants

that cember today, us before the case the stock was In fact plans. that the responds cial independent to be appear is subscription does the time there for at paid had reasonable McDaniel evidence that stockholder each because immaterial ability to financial her pay reliable evidence subscription the stock via committed expenses. prosecution share her meet stock. for the Charitys that undisputed Second, it is that this altogether clear is not But it pros provide 80% were Kyles never that appears It the case. provide towas McDaniel costs ecution says stock, she McDaniel his paid for however, that suggests, The record 20%. $2,000 received. she only paid $500 estab nor McDaniel neither misses the argument Moreover, the FCC’s their share could other that lished each agreements subscription point: the stock 45; R. Dep. Tr. Charity C. expenses. is at that What not at issue. 49; 220. J.A. Tr. Charity Dep. issued. signed and were of stock “shares” that such has held cases, the FCC other they had been indicated shares Those disqualifi financial is grounds behavior for, paid they were not for, in fact but Schultz, 4 F.C.C.R. Pepper cation. See For over year later. all, nearly a until if at (noting that be (Rev.Bd.1989) 6393, 6399 Riv- in James no funds there year FCC Review Media Northampton fore went its bills account corporate er’s finan- interpreted consistently facts, Com- of these unpaid. In view upon existence to rest cial explain how James failed mission Inc., FM, documentation); Aspen financial financially qualified been have could disquali- (1989) (applicant 4 F.C.C.R. of time. period during this finan- exchange of was no there when fied certification); question legitimate Fourth, JAM it we think before information cial Charitys re- Communications, Inc., 4 F.C.C.R. whether fact of material appli- (holding applicants to the James (Rev.Bd.1989) committed mained when collapsed. at hand” building “documentation their have after cation must Community In the Chari- City all times Capital that at applying); concluded F) 1452, (P Rad.Reg.2d & Inc., terests, “willing able” to tys ap UHF ex- (disqualifying ¶ (Rev.Bd.1987) River’s at share of no bal Ltd. grounds Broadcasting when plicant on financial Weyburn penses. documenta- 90-1738, slip op. other sheets or Partnership, ance No. FCC principals from the 20, 1990); 62. obtained J.A. tion had been June (A.L.J. released funding); upon for relied responsive who were to FCC are AU and Inc., Communications, Charitys remained fi- Americas Las question F) at (P 11118-9. & Rad.Reg.2d com- meet their nancially able River, 5 F.C.C.R. mitment testimony, Third, according to her latest Charitys’ 3813; due only paid $500 McDaniel greater remains do so willingness to when she not sure and was for her stock certainly example, For doubt. Dep. 12- Richmond paid for it.2 waning their interest was perceived is also uncontro- There 162-63. J.A. inves- replacement began to search for passed year nearly a verted evidence in order thus be would A tors. stock time James between appears figure subscriptions, the correct stock recalled During deposition, McDaniel $2,000. $2,500, to be on the obligation but based to be stock *11 requirements Charitys’ level of com- whether of section 1.65 what the establish met.4 were mitment was. Fifth, by McDaniel’s we are troubled sum, we note that AU’s conclu- $6,000 hearing fee. payment cash questions sion that there were no of mate- deposition she was eva record shows concerning rial fact the continuous finan- money. source of sive as qualification cial of James River was arbi- 145-47; Dep. 593- McDaniel Richmond J.A. trary capricious. Many unanswered Appendix, 146- supplement to Joint remain. questions Was there at all times a though the source of the 168-60. Even clear, so, plan? why workable financial If money appear to be relevant would expectations about costs ability pay for question of McDaniel’s by principals radically so different? prosecution expense, see her share of the Charitys Did the and McDaniel both have Corp., Key Broadcasting F.C.C.R. party reasonable assurance that the other Pines LPB (ALJ 1088); reviewed Ocean obligations? could meet (Rev.Bd. Corp., 5 F.C.C.R. 5821 Broadcast significance of the fact that What was Broadcasting Island 1000); Fenwick stock, “fully paid,” which was labeled (1002) (Review Corp., F.C.C.R. paid nearly year was in fact not for until a- sustaining ALJ Commission Charitys after it issued? was Were finding a sham all times committed to James If River? limited wealthy physician who had been not, McDaniel aware of their lack of $6,000 general partner partner gave money commitment? did the Where come fee), hearing refused to let the the AU repay from that used loans discovery parties pursue through the issue suing her over? that banks were Where depositions. and in $6,000 come did the hearing fee? Did McDan- used to Sixth, the AU’s failure to allow money from Fish for the iel divert received questions whether or not Renard about personal to her use? corporation What Charity loaned McDaniel on about purposes and circumstances be- The issue

December 1085 was also error. by loans made Fish to McDaniel? hind the ap of financial control of the James River total What is McDaniel’s indebtedness plication being challenged, was and position put him in Fish and what does by Charity loans made to McDaniel have concerning decisional control over James bearing question truly on the con who go The list could on. River? corporation.3 trolled the never held to only hearing Not was a did The FCC’s conclusion that McDaniel issues, a number of unresolved address by 1.65 not disclos- not violate C.F.R. § put discovery on that en restraints ing undermining certain information impossibility adequately ad sured prema- qualification River’s financial dressing the financial issues. ture, airing because a full the financial Although of the FCC’s sub we mindful qualification issues never Since occurred. ruling discretion in on a motion for stantial determine held to Radio decision, see David Ortiz summary in fact remained at Corp. v. are not 041 F.2d at we meeting relevant times committed all commitments, evidentiary espe that the impos- it is satisfied their James River record — cially by limited as it was AU restrictions sible for us or the Commission to determine argue discovery the Review Board The AU's refusal to allow to ascer- 4. also has failed consider whether the new bank letter per- diverted funds for tain whether McDaniel by acceptable obtained upon Robert Fish is an basis qual- sonal use that were to her Fish for the which to find James River’s financial appears application also to have been error. argument We decline to address this ification. raise and char- Such diversion would candor appellants challenge the Fleet because did not may acter issues that the FCC wish to address the Commission thus Bank letter before they may remand. on point appeal. not raise the *12 1232 See, showing. e.g., lack of to resolve sum- candor WHW scope—was sufficient on its Enters., FCC, 753 Inc. v. F.2d 1139 qualification issue.

marily the financial Radio, (D.C.Cir.1985); Intercontinental Misrepresentation (Rev.Bd.1984) Inc., 98 639 F.C.C.2d IV. (“[OJmissions unaccom- or inconsistencies’ argue FCC that Appellants ‘willingness de- by evidence of a to panied to deter enlarging in not the issues erred action.”), not a for modi- ceive’ are cause guilty of had been whether mine. Rad.Reg.2d (P 57 & grounds, on other fied lack of candor. and/or a misrepresentation omitted). F) (citation (F.C.C.1985) But a occasions Appellants tried on number puts appellants the FCC in a situ- Catch-22 by misrepresentations open to the issue of able to Appellants ation. have not been af River’s financial McDaniel about James to establish whether there was an intent approv fairs, AU, with the FCC’s but deceive an issue has not been al- because al, We conclude open to issue. refused lowed, but an issue has not been allowed refusing to that these decisions they because have not established an intent misrepresentation were open the issue of Joseph Heller not to deceive. himself could collectively in error. a dilemma. have fashioned tidier original stock certificates were When this FCC concludes because issued, “fully paid they bore the notation questions held mis- Court has about non-assessable,” and McDaniel intro- representations questions pecu- facts true correct. duced these certificates as liarly of the Commis- province within However, it was later discovered that consider, WEBR, sion Inc. for Charitys pay did not for stock (D.C.Cir.1969), this F.2d Court year after the certificates almost interfere the AU’s reason- should not fully paid and that McDaniel issued conclusion that McDaniel lacked an able is in the for stock. There no evidence her no intention to deceive and that therefore Kyles paid for ever his shares. record that misrepresentation lack of candor or issue noted, signif- McDaniel also told three As was warranted. The FCC failed conflicting stories icantly different scope misrep- grips come with the stock, appel- her payment about for alleged by appellants. resentation correctly as irreconcilable. lants describe is satisfied that the necessarily persuaded by appel- We are not “committed, always willing McDaniel were last is suggestion lants’ version stock,” pay this is and able to for probably previ- and that “the the truth two responsive misrepresentation is- up’ ous were contrived to ‘cover stories face, the certificates sue. On their stock did fact that McDaniel for for, they paid been declare that when Charity Drs. did not stock and fact, together they in fact had not. This year nearly after the their stock stories, conflicting with McDaniel’s raises Appellants’ application.” Br. filing of the concerning genuine issue whether McDan- agree that the stock certifi- at 44. But we purposeful misrepresenta- iel’s stories were bespeak misrepresenta- themselves cates lapses. as opposed memory tions they “fully tion because were labeled misrepresentations alleged concerning clearly this when non-assessable” germane to a determi- stock certificates are unsupportable we not the case. And find nation whether James River was contin- as that three stories AU’s conclusion uously financially qualified. By failing to simply the factually distinct as these are on entertain and conduct least, lapse. very memory result of At issue, misrepresentation the AU could not hearing. question warranted a qualifica- adequately address the financial tion issue. if appellants The FCC asserts that even reasonably have con- shown what could V. De Control/Real Facto inconsistency, pre- they have not strued as Party-In-Interest sented factual evidence the incon- sistency Appellants involved an intent deceive—an maintain that the Com misrepresentation failing enlarge of a the is- essential element mission erred (quoting Arnold L. Chase at 1564 wealthy determine sues Inc., Rad.Reg.2d Fish, Broadcasting, shareholder, had Chase Robert non-voting (F.C.C.1986)). The F) 111, (P in the & party-in-interest the real become argue jure control both fixation de FCC’s application. *13 non-voting inappropriate and uncharacteristic. acquired all the Fish when of question con- frequently has held that he took de FCC stock facto relatively result that as a arises when a financial control partnership, trol of upon a relies impecunious not receive 100% individual should Appellants acquire note to or applying integration wealthy individual credit. stock, station, espe- acquired the television Fish a radio or construct when Appellants believe supplying impecunious. cially the individual when the ser- example, confirmed when control For Fish’s a broadcaster. funds is *14 discussed issues review not seek misrepresentation appellants did 44. Because appraisal adequate the ruling before viously. Because Board’s Review of the misrepresen- be- properly is not Commission, the the consideration a necessitates Radio Com- Rogers issues tation See fore this Court. issue, par- real F.2d Servs., party-in-interest real Inc. munications full (because ap- a (D.C.Cir.1985) issue warranted ty-in-interest 413 n. appeal a Review as well. pellant failed Commission, ex- it failed to ruling to the Vote-Selling remedies, VI. and there- Issue haust administrative is determination fore, Board’s the Review ALT allege that Appellants Court). properly before toas hear an issue refusing to erred in on the her had sold vote McDaniel in order obtain City Council Richmond Treatment Inconsistent VII. backing for Charitys’ financial Weyburn and James According ap application. James separate brief its argues in Weyburn the Chari that testified pellants, McDaniel arbitrarily capri- acted that River because money James in tys invested credit, integration it denying in ciously a medical “help” with they wanted that treatment it received part because They note hoped to build. they building treatment was inconsistent in James Charitys invested that after argument Weyburn’s River received. al ordinance for an River, voted integration credit to a entitled full it was build a medical lowing construction argument that weak, its although appears Charitys. The commonwealth’s ing by the consistently treated was not war filed criminal Richmond attorney in remand stronger. Because is a bit dropped, against rants, later rela- may change the in this case ordered Virgi that she violated alleging will not applicants, we positions tive accepting laws nia’s conflict-of-interest Weyburn re- decide whether at this time Charitys. a loan from by the treatment and lawful ceived fair only broad- acknowledge that may want to on remand FCC. The subject of can be conduct cast-related part of as Weyburn’s claims reconsider Policy Regard- FCC’s issue. See character caprice without to resolve its effort Broad- Qualifications ing Character competi- licensing in this assorted issues (P F)& 801 Rad.Reg.2d Licensing, cast tion. acknowledge They (F.C.C.1986). also for re-election defeated after McDaniel Conclusion VIII. warrants criminal city council the FCC’s treatment that the We conclude nevertheless dropped. Appellants misrepresenta- qualification, the financial there to the extent maintain does tion, issues party-in-interest and real McDaniel’s vote connection between deci- of reasoned the standard satisfy building and zoning the medical the Administrative set forth in sionmaking Riv- backing Charitys’ financial def- Although the level Act. Procedure conduct er’s McDaniel’s application, adjudicative facility deci- FM on the air is most due administrative unfortunate. erence clear sionmaking very high, is it is For the court do so on the basis of adequately challenges agency’s deal with these FCC did not factual conclu- Thus, as to the three important greater issues. sions is of still concern. And for above, proceeding enumerated this is issues the court to mandate to the Commission for further remanded to the Commission precedents aligned how its own are to opinion. this proceedings consistent with the final assault on the doctrine of defer- agency ence to decisions. ordered. So jH s(s sfc sfs H* MIKVA, Judge, dissenting: Chief. conclusion panel’s the AU today garden variety panel uses a granting summary erred in decision is comparative hearing, granting a construc- premised misapplication on a fundamental permit FM radio station tion new prior prece- of the FCC’s decisions and the Richmond, important Virginia, to take an panel correctly dents of this court. The dangerous into the realm of incursion states, Majority appli- that an op. agency pan- administrative discretion. The financially qualified cant is if she has “rea- Supreme if this court were a el acts as assurance” sonable of sufficient financial *15 Commission,man- Federal Communications station, resources to the oper- build and to every jot dated to review and tittle of the ate it for the first three months without procedures factual find- Commission’s and relying on station revenue. Financial ings. process, panel In the the fails to Qualification Standards Aural proper due to an accord the deference 407, Broadcasting Applicants, 69 F.C.C.2d agency, ignores misinterprets and and rele- (1978) added). (emphasis Having 408 laid precedent vant of the Commission and this definition, general panel ig- out this uphold agency I court. would determi- long decisions, by nores a line of FCC cited nation, and dissent from the therefore again by AU below and raised court’s decision. court, agency holding before this that a Regrettably, panel’s opinion projection prosecution expenses because the of total evidentiary overturns the Commission’s need not be taken into account in determin- procedures findings, necessarily ing applicant’s ability and I must financial to con- specifics operate proposed recite the in struct considerable detail. and station Weyburn Broadcasting, applicant willing the unsuccessful where an has shown itself unhappy expenses contestant for the and able to such on a current Radio, question, applicants Family in was one of 35 basis. Port Huron See one, (1990); given Inc., seek this license. It not 4563 but North Associates, hearings ampton two before an administrative law Media F.C.C.R. one, (Rev.Bd.1988), denied, judge. given It was not but two hear- review (1989), ings the Commission’s Review on other before F.C.C.R. aff'd hearings “pa- grounds, Northampton Board. Some of these Media Associates F.C.C., (D.C.Cir.1991); per hearings,” while others involved the 941 F.2d taking testimony. Corp., Broadcasting of live The Commission 54 Rad. Muncie (1983); ultimately Reg.2d itself affirmed the decision of its 46-47 Zia Tele-Commu Inc., grant nications, Review Board to the license to James 50 F.C.C.2d 187-89 River, (Rev.Bd.1974). today and the court overturns that The AU found that James willing pay prosecu decision. River was and able to basis, expenses ongoing that tion on an The court now decides that the AU and expenses such should therefore not con be - enough the Review Board did not allow resolving qualifica in the financial sidered discovery enough testimony live on the tion issue. proceed- issues and remands for further ings. hearing Notwithstanding agreed-upon The initial before the defini- stated, years ago. “financially qualified” just was almost five For this court tion of rationale, unseemly delay getting findings to add in this and the AU’s Charitys to from the of a loan existence ble of the resolution rejects the AU’s panel only to real McDaniel, is relevant focusing al by Ms. issue qualification involving the Drs. expenses, party-in-interest prosecution exclusively on most fees, only party-in-inter- real rather But Charity. costs and legal such as re- Weyburn operation costs. raised est issue construction than Thus, two final these concludes Fish. instance, panel to Mr. spect For finan of the issues a workable pertinent not did have are not points not include of this plan did all appeal. I recite plan because this cial raised Charity the Drs. it forms costs, only because because evidentiary legal trivia meeting decision, of the no majority’s gravamen and Ms. ap prosecuting nit-picking costs on the it vivifies the minds also because opin at 1229. Majority op. decision. plication. objection to my forms why ****** explain lengths to some goes ion Northampton Me decision this Court's ex- above, prosecution As discussed (D.C.Cir. F.2d 1214 Associates, 941 dia into account taken generally not penses are applicant 1991), relieve does qual- applicant’s financial determining an reliable itself to assure responsibility has shown itself applicant if ification is func man straw That support. expenses on such willing and able concluded, and AU never tionless. provides virtual- panel basis. ongoing argue, that does not the Commission finding rejecting the AU’s ly no basis obligation assure have an did not threshold this River satisfied that James qualified. financially it itself expenses condition, prosecu Rather, maintains fi- from the excluded be therefore should considered need not expenses tion its de- inquiry. nancial *16 being they were because agency’s calculus er- “reversible exegesis of the six tailed position ongoing basis—a paid on AU, panel the by the committed rors” practice. agency consistent with squarely rele- even that are only points two offers may that the is correct majority The panel The states that inquiry. to this vant in some account expenses into such take its unpaid and went corporation’s bills “the op. 1229 n. at circumstances, Majority see Ma- non-payment," attorney for withdrew in choos not did err 1, the Commission was some that there op. jority in case. so this ing to do not Charity’s “interest the Drs. evidence alleged the other on panel’s attack The continued respect the waning” with was the finan- resolution of AU’s errors in the application. Id. the of prosecution misplaced. equally is cial treatment the AU’s contention that The on River’s issues bears of the None meet the standard did not these issues of except insofar as qualification, in the decisionmaking out set reasoned of ability River’s to James germane they are (“APA”) dis- Act Procedure Administrative ex- prosecution willingness principles the and stands the record torts issue, discussed be- threshold penses—the the APA embodied in deference judicial of fails to ad- completely low, panel that the the follow- The made AU their head. the stock sales of proceeds The dress. the respect to with findings on remand ing construction cover intended to were legal of fees: payment" irrel- costs, are therefore operation always have legal fees [Although Whether qualification. to financial evant has applicant the paid promptly, been timely paid is were subscriptions the stock More- expenses. prosecution its paid is- misrepresentation only relevant from withdrew over, time counsel at the pay- cash The sue, discussed below. also account the James case ... the prosecu- hearing involves fee of the ment only two month for in arrears was undeniably paid, and expense that tion $7,853.50. The de only period and to financial similarly irrelevant is therefore pales into in arrears amount minimis the funds of The source qualification. by the fact measured insignificance when fee, possi- like the hearing the used Charitys remained finan- $150,000 tion whether paid over River had that James to meet their commitment....” cially able fees to date. legal in Thus, the AU panel concedes that Id. Order, 5 F.C.C.R. Supplementary collapse of adequately considered 1990). (AU Virginia the Bank of building and medical that James establishes record The hearing is assurance. Further letter source money from its not borrow did concludes, panel required, nonetheless op- and initial financing for construction willingness Charitys’ “the because [meet legal pay its erating expenses ... in remains commitment] legal fees on Rather, paid its it fees. Id. greater doubt.” principal’s either on-going basis accounts. corporation’s own or seriously suggest panel cannot for Thus, money available construc- any there required is whenever is stan- operation, legal initial tion and investor’s that an smidgeon of evidence has financially qualified, being dard waning,” especially when “interest Al- adversely affected. never been already laid out over investor has cer- year during part of though $150,000 expenses. timely paid on a were not legal fees tain will- that the were decision AU’s by December basis, fact is that expenses amply pay prosecution ing to $5,274.88 bill total record this case. As supported on the close to the account bringing paid counsel, the temporary withdrawal thereafter, current; repeatedly panel upon rests reed slender brought usual- current has been account remand, found that the Drs. Chari- the AU billing. Fur- two of a month or ly within immediately of the situa- aware ty has thermore, is now the account deliberately they insulat- tion because and the months current several been pro- day-to-day affairs ed from $150,000 legal over applicant station accordance posed date, mettle. its financial proving fees that Ms. McDaniel representation Order, 90M- Opinion and Memorandum pro- over the control sole exercise would 1990). (AU June at 2 Summary Supplementary posed station. legal history entire reviewed the event, Decision, at 3814. facts payments and concluded fees *17 himself, prose- and the reinstated counsel unwillingness inabili- an or indicate did not critical at the current expenses were cution ongo- expenses on an ty pay prosecution to times. with might disagree panel The ing basis. the lity to maintain record, unsupported by substantial reason deference capricious. The sionmaking, or is otherwise tions and agency waning,” Majority ing whether the from same ported by substantial record to the Commission’s panel The AU’s conclusion. is the panel’s acknowledges required not to accord interpretations manifests precedents. due Drs. contention agency findings of fundamental failure panel offers that “interest was Charity’s resolve lack the op. at that the But it strains findings when of their own customary that further of reasoned AU’s “[t]he the evidence evidence. no arbitrary and 1231, suffers question convincing finding is AU fact and to defer judicial regula- provides some on the credu- hear- deci- sup- The and sentation issue of Ms. different rather stock, and a cern However, The the question Commission’s credibility of witnesses. substantial The deference McDaniel need in this ^[******] misrepresentation issue that Ms. panel’s than stories on this Court deference, simply confused which reading of the cold record pervasive support for treatment findings of did tell three suffers regarding McDaniel instance the does not review especially FCC is entitled in their of the payment The AU found the was fact de to assess the same substantially or is a factual panel’s dishonest, forgetful. misrepre- opinion. light for her novo. lack con- the the of- ques- responsive to that are the the Commission conclu- panel’s the Finally, contrary to Bayliss, James D. and William little sion, subscriptions are lawyer, were the stock Secretary local as paid for consequence stock of when

unsure earlier, I do niceties. There discussed corporate River. As of James well as other finding or falsification erred that the AU of deliberate no evidence believe to the Presid- It is clear on expenses paid prosecution candor. lack of that demeanor very the modest basis; observed the ing Judge who ongoing Memorandum the time added). ferent Bayliss Ms. nesses’ demeanor. willingness and ed failed el’s misleading assertion that evidence was he had before dence of an intent ny delivered *18 establish based on intent to deceive. McDaniel’s tions actions be court’s more mony view of absence no evidence all the of the concluding misrepresentation act cavalierly trumped contention panel given the loss Presiding to come “appellate” years suspicions. irrationally or abuse did that corporation can The details the AU made is based on eyeball ample simply of such evidence. (ALJ explanation not demonstrate transcript allowed on panel, vintage. deposition in his him three McDaniel, Opinion that the ability to attendant Judge finds only with opportunity June failure to intentional testimony ignores the memory of events grips with The AU position Furthermore, which never saw Bayliss deceive. presence. issue,” discrepancies in 20, 1990) (emphasis of the stock Benns has be ascribed the issue. his pay for the stock. Commission the AU by separate must recall inaccurate respect to the as to the wit- made final deception and the formation to adduce evi- his discretion Majority Order, 90M- live have a dif- ought Weyburn precisely complete appellate upon re- scope requisite decision, respond- testimo- findings finding, offered deposi- atBut solely trans- testi- 3 or “has pan- Mr. Ms. op. did facto proceeds scriptions were hundreds ation rectly rests its was founded disturb availability of construction even question of whether Fish was al to allow over James burn River, plication. el, this they claim indicia over the cised expenses. volved The latter account applicant’s consistent The final Majority fact, panel ^[*] respect to ease, more did not establish or even guaranteed by loan assurances costs, which were estimated control. states that bills of control control-by a this remand is the AU of the Ms. McDaniel in actual control used prosecution of James River’s of thousands of opinion insignificant with Jfc involve with an the Commission that the facts raised Moreover, grounds upon sort of River. account, a real op. on the finding. The attempted to exercise precedents cited Mr. Fish. Weyburn’s arguably actually ^[*] beyond does squarely addressed pay prosecution considerable 1233-1234, from which fact that Majority party-in-interest arrangement Mr. control is third not over a FCC’s Commission’s not assail. ^[*] available unpaid Fish dollars mere of the and initial claim party over prior de Mr. Fish exer- expenses, respect to the proceeds sole rationale he against Ms. exercised ^[*] op. at 1233. jure panel payment by the completely strayed in stock and which additional personal cases that Mr. does by whereby control control in the # refus- incor- panel costs. oper- issue Wey- some that sub- pan- ap- de in- non-voting participants applicant’s portion

agree expenses. the FCC’s reviews opinio'n panel’s fine tooth in this case

proceedings the credi- about making judgments comb— seen, have we witnesses

bility of allow failing to agency

chastising the hearings, and re- or more discovery

more findings that agency defer fusing to by substantial supported

reasonable exacting panel’s If the evidence. record by imposed systematically standard be com- would court, the Commission

this witnesses, designate hear all pelled to Summary adjudi- issues, the time. all of

all impossible. become would of issues cation case handle would the Commission How review- our handle would (and how we

load concern. load) a serious would be

ing case the Su- many times told been

We have many remind- times Court, have preme far role is us, our before parties ed administra- ought let We

more limited. I agencies. administrative agencies tive

dissent. America STATES

UNITED

v. MERLOS, Pablo a/k/a Juan

Pablo Appellant. Escobar, Berga, Vale America STATES

UNITED LORIANO, Liriano-Alvedo a/k/a

Victor Moreno, Tony Manuel Morgan, Jose Appellant. Soto, Shorty, 91-3213, 91-3217.

Nos. Appeals, Court States United Public Federal Kenney, Asst. Circuit. Leigh A. of Columbia District Kramer, Federal A.J. Defender, whom 24, 1992. Argued Nov. DC, was on Washington, Defender, Public 12, 1993. Feb. Decided 91-3213. in No. brief, appellant Public Federal Sonenberg, Asst. Santha ap- DC, entered Washington, Defender, in No. 91-3213. appellant

pearance that Fish can notes vide corpo- in the deposited money was that no a material there has been if he determines 2, 1986,nearly December until rate account po- change in McDaniel’s adverse issued. Two the stock was year after Moreover, alleged, Fish had Benns sition. amount of in the each payments, finan- completely over James River’s taken time, by the apparently at that were made sent originally While Fish cial affairs. ledger showed sheets Charitys. The corpo- deposit money to McDaniel stock, and for his paid Kyles Dr. never payment of for the bank account ration’s for her by McDaniel payment reflected no bills, he had he admitted that corporate previous testimo- stock, with her in conflict bills, including legal paid corporate later ny. J.A. 633. fees, directly himself. April deposition, on At a second neither concluded that The ALJ fully she had McDaniel stated payment nor Fish’s direct promissory notes only stock, $500 paid for her exer- “demonstrate Fish made of bills she $2,000, not sure when and was River.” control over Dep. cised decisional McDaniel Richmond payment. found that 55. He further Id. at J.A. 12-13; J.A. 162-63. actual- no Fish there was evidence motion. He Benns’ The ALJ denied corporation or for the ly making decisions fail- River’s shareholders’ ruled that James paying action other than taken subscriptions when ure to noted, fact, the AU corporate bills. indicate an filed did not

Notes

notes judgment Serv., of confession 5 Broadcasting ies of Pueblo Radio could McDaniel, he “extracted” Board de- (Rev.Bd.1990),the F.C.C.R. 4829 out point also any time. call at applicant an integration credit to nied a full had obtained that he Fish “boasted” signature had nonvoting stockholder whose corporation, for the of credit letter bank checking account and authority as an qualification establishing its financial There to bills. written checks the letter would applicant, found that Commission intervention. his issued without have been by the actions post-organizational several bills some James River significantly, Most of including paying bills partners, limited office, or directly to his home were sent permissible “go beyond the applicant, himself, bills without he those and are suf- partners limited functions of consulting, McDan- through, even going or support themselves ... ficient in iel. partners general conclusion has de that McDaniel responds The FCC active, controlling only would not be support In corporation. control of the jure owners.” agree- contention, the FCC cites its TV, 4 F.C.C.R. (quoting Coast at 4832 Id. McDaniel which Fish and ment between (1989)). The circumstances 1787 responsible be “shall states that McDaniel here, to those uncannily similar are Pueblo of the prosecution” for the opposite outcome. reached an the FCC but offi- as either an “will serve that Fish not and control that finances recognition not Corporation,” of the will cer or director least closely linked extends back manage- in the “permitted participate be F.2d Heitmeyer v. fifty years to Corporation’s operation of ment or held that: (D.C.Cir.1937),where we 91, 99 consultant, or in employee, as an business most of the that one It is well known “will be retained capacity,” and other of con- and effective methods powerful or on any sort for perform services ... is the control trol of business Corporation.” Weyburn behalf its finances. Partnership, FCC No. Broadcasting Ltd. upon the should be is and burden (A.L.J. 90-1738, [The] slip op. released June Commission, not satisfy the applicant to 1990). ability con- financial he has only that financial refusing to control allow station, operate struct and incon issue, appears to have acted free of operate it ability to construct well precedents, own as sistently with its by any person control, indirect direct or In Astro of this Circuit. precedents as the by the proscribed the classes within FCC, 857 Co. v. line Communications Act]. [Communications (D.C.Cir.1988), we stated that F.2d 1556 Rish, M.D., 6 F.C.C.R. B. also Benito See party-in-interest real Commission’s “[t]he (1991)(inter alia, can dem “finances a third on whether inquiry typically focuses relinquished interest, control been onstrate that ownership or will person ‘has person”); Sound unauthorized to another actually potentially position in a ” (Rev. Co., 6 F.C.C.R. 3626 Broadcasting Id. operation the station.’ control the should been have related” Co., Inc., 5 “broadcast Broadcasting Bd.1991); Rayne inquiry. subject of Hills Seven (Rev.Bd.1990); F.C.C.R. (Rev. 6867, 6880 Co., 2 F.C.C.R. Television denial Board’s the Review find that We power to con is Bd.1987) purse (power properly vote-selling is issue Inc., Television, trol); Perry requested the in- Benns us. When before (Rev.Bd.1990). issue, Review vote-selling clusion prece- departed from Benns allegations thus ruled that as enlarge issues appropriate refusing to more explore were sought dents in That courts. or local party-in-interest. real litigation in the state J.A. closely Order, F.C.C.R. at related Remand pre-

in the AU’s panel implies tation issue sue quoted The “Catch-22” intent above, refusal to intent to is a to deceive. Weyburn was unable complete goes allow a deceive because directly to panel discerns mirage. misrepresen- no is- tional McDaniel, he held ny tial role in obtaining the bank found this last Bank that Mr. Fish promissory and that (there point). day-to-day affairs of James he took an active did not letter The AU notes conflicting testimo- from Fleet play a reasonably substan- role Na-