For Renewal of Licenses of Stations KFRC-AM and KFMS-FM, San Francisco, Calif.
Files Nos. BR-22 and BRH-25; Files Nos. BR-43 and BRH-1190
FEDERAL COMMUNICATIONS COMMISSION
16 F.C.C.2d 989 (1969)
RELEASE-NUMBER: FCC 69-236
March 13, 1969 Adopted
MEMORANDUM OPINION AND ORDER
BY THE COMMISSION: COMMISSIONER BARTLEY ABSTAINING FROM VOTING; COMMISSIONER COX ABSTAINING FROM VOTING ON KFRC-AM AND KFMS (FM); COMMISSIONER JOHNSON DISSENTING AND ISSUING STATEMENTS; COMMISSIONER H. REX LEE CONCURRING IN THE RESULT.
[*989] 1. The Commission has before it the above captioned renewal applications.
2. RKO-General has adequately surveyed the
3. The format proposals for the four stations are as follows:
News, 11 hours, 32 minutes, 6.5 percent.
Public affairs, 5 hours, 2 minutes, 3 percent.
Other nonentertainment, 6 hours, 43 minutes, 4 percent.
News, 5 hours, 3 percent.
Public affairs, 3 hours, 30 minutes, 2.1 percent.
Other nonentertainment, 6 hours, 47 minutes, 4.1 percent.
(KHJ-FM does not duplicate station KHJ-AM.)
News, 11 hours, 46 minutes, 7 percent.
Public affairs, 3 hours, 37 minutes, 2.2 percent.
Other nonentertainment, 4 hours, 26 minutes, 2.6 percent.
News, 9 hours, 16 minutes, 7.4 percent.
Public affairs, 2 hours, 50 minutes, 2.3 percent.
[*990] Other nonentertainment, 3 hours, 15 minutes, 2.6 percent.
(KFMS-FM duplicates KFRC-AM on weekends, as follows: 18 hours Saturdays and 19 hours, 15 minutes Sundays.)
4. The proposed commercial limitations for the four stations are:
(a) KHJ -- 18 minute per hour ceiling with no exceptions.
(b) KHJ-FM -- 15 minute per hour ceiling with no exceptions.
(c) KFRC -- 18 minute per hour ceiling with no exceptions.
(d) KFMS-FM -- 8 minute per hour ceiling with no exceptions.
5. The applications have been found to be adequate in all respects and RKO, except for the antitrust problem discussed below, is legally, technically, financially, and otherwise qualified and we find that a grant of the applications will serve the public interest, convenience, and necessity.
6. There is presently pending in the U.S.
District Court for the Northern District of Ohio an action entitled
7. Accordingly, It is ordered, That the above-captioned applications of RKO General, Inc., for renewal of licenses of Stations KHJ-AM, KHJ-FM, KFRC-AM, and KFMS-FM Are granted, subject to the following condition:
grant is subject to whatever action the Commission may deem appropriate as a
result of developments and findings arising in the pending civil action of
FEDERAL COMMUNICATIONS COMMISSION, BEN F. WAPLE, Secretary.
DISSENTING STATEMENT OF COMMISSIONER NICHOLAS JOHNSON
Commission here renews the licenses of the RKO General radio stations in
This grant is subject to whatever action the Commission may deem appropriate as a result of developments and findings arising in the pending civil action [*991] United States of America v. The General Tire and Rubber Co., Aerojet General Corp., A. M. Byers Co., and RKO General, Inc. (No. 6-67-155), filed March 2, 1967, in the U.S. District Court for the Northern District of Ohio and, further, is subject to whatever action the Commission may deem appropriate as a result of developments and findings arising in the pending FCC proceeding in docket No. 16679.
This is the first RKO General renewal to come up since the Commission added a disqualifying issue in another proceeding involving KHJtv/. A review of the actions involving KHJ will be helpful.
More than 3 years ago KHJ-TV was challenged at renewal by another applicant for the license. That case is still in hearing although the record is closed (docket No. 16679). That applicant charged, among other things, that:
The past broadcast record of RKO in its operation of Station KHJ-TV is unusually poor, since it did not ascertain the needs tastes, and desires of its service area; did not create programing to meet the needs of its service area; misused the facility to gain profits at the expense of its service area; and violated the public trust inherent in its broadcast license. RKO should receive a major demerit because of unusually poor past performance. (Emphasis in original.)
Proposed findings of fact and conclusions of Fidelity Television, Inc., in docket No. 16679 et al., p. 124, par. 41.
RKO General, Inc., has, of course, disputed these charges. I do not imply any judgment by citing them. My point is only that there are outstanding unresolved questions with regard to this licensee --questions now before this Commission.
In March 1967 the U.S. Department of Justice filed a civil complaint against General Tire & Rubber including its subsidiary RKO General. The offenses charged included violating section 1 of the Sherman Act:
(a) By engaging in a combination and conspiracy to utilize reciprocity whereby the purchasing power of all of said defendants is used to coerce and persuade certain actual and potential suppliers of the defendants to purchase tires, wrought iron products, advertising time, and other products and services from said defendants, in unreasonable restraint of the aforesaid trade and commerce; and
(b) By entering into contracts, agreements, and understandings expressed and implied, involving reciprocal purchasing arrangements with respect to a substantial amount of interstate commerce whereby the defendants purchase products and services sold by various suppliers on condition that said suppliers purchase the products and services of such defendant or defendants, in unreasonable restraint of the aforesaid trade and commerce.
In 1968 the examiner in the KHJ-TV case (docket No. 16679) reopened the record to examine KHJ-TV's involvement in the allegations concerning reciprocity. (F.C.C. 68M-394). The full Commission declined to review that action but did, on its own motion, add a disqualifying issue against KHJ-TV in the renewal proceeding:
To determine, in light of the evidence adduced with respect to the proceeding issues, whether RKO General, Inc., should be disqualified or, if not, whether a comparative demerit should be assessed against it in this proceeding.
F.C.C. 68-892, par. 6; 14 P & F Radio Reg. 2d 90, 91 (1968).
Now the Commission renews the RKO General licenses for AM and FM radio
Nor do I believe that this matter necessarily has been adequately examined in the KHJ-TV proceeding. The addition of a disqualification issue in that proceeding was preceded by the following comment:
We further note that Fidelity, while still wishing the Commission to make its own investigation, obtain material from the Department of Justice, and place the burden of going forward with the introduction of evidence on RKO, claims the ability to prove its own case without assistance. It would therefore appear that Fidelity has already obtained essentially the relief it seeks, save for the addition of a disqualification issue (par. 3) id.
Our staff has not participated in that case, and while I have not yet examined the record the Commission should not rely solely on the ability of a private applicant to conduct an adequate investigation of the alleged reciprocal practices of RKO General. Normally, when a disqualifying issue is part of a comparative hearing proceeding the Commission's staff actively participates in the case. But in the KHJ-TV proceeding evidence on RKO General reciprocal practices was taken under the standard comparative issue, and was limited to its bearing on RKO General's comparative merits. The record was closed prior to the addition of the disqualifying issue and the Commission's hearing staff did not participate.
Under these circumstances the Commission's condition offers little guide as a future action. A conditional grant is a well-established, if somewhat questionable, procedure designed to avoid prolonged deferrals on applications. But a condition suggests that there are unresolved factual matters that might at some future date require further proceedings or even denial. The Communications Act bars a grant under such circumstances. 47 U.S.S. sec. 309(e) (1964). Such is the case for the license renewals of RKO General. In a not dissimilar case the Commission first refused, but then sought Court remand to designate for hearing renewal applications on anticompetitive issues where private parties were present to seek Court relief if the Commission did not act. Florida-Georgia Television Co., Inc., 13 F.C.C. 2d 53 (1968).
The Communications Act is very express in its injunction that we must find the public interest served by a license renewal. When there are questions of fact involved it expressly requires us to hold a hearing.
We have before us a licensee that is one of the Nation's classic
examples of a conglomerate corporate broadcaster. It is one of the most politically powerful group owners. It has a TV-AM-FM in
would seem to me that this very ownership pattern, taken alone, would be enough
to warrant a closer look at KHJ-AM-FM's ability to meet our public interest
standards. The media ownership problem
-- conglomerates, multiple owners, multimedia, and so forth -- has recently
been receiving widespread interest and concern from many quarters -- including
the Justice Department and this Commission.
RKO raises many, if not all, of the media ownership problems. That its licenses should be automatically
renewed seems a little unusual. The
very license renewal before us is in conflict with the Department of Justice's
proposals for a given market in our one-to-a-market proposed rulemaking, in
that RKO owns not one, or even two, but three full-time properties in the
The company has a serious antitrust suit pending against it, involving, among other things, its use of its broadcast properties in ways violating the antitrust laws.
Local citizens are challenging its ownership of broadcast properties in this very market -- KHJ-TV. It is one thing -- and troublesome enough -- to grant a multiple owner a license renewal in one market while holding a hearing on one of its properties in another market. It is quite another to renew two properties of a single owner in one market while holding a hearing on its third property in that very market.
One would think that any one of these elements -- let alone all of them together -- would be enough to warrant setting the KHJ-AM-FM license renewal for hearing. At the very least, if for administrative reasons the Commission does not wish to hold a hearing at this time, the better course would seem to be to hold the license renewal in abeyance until such a KHJ-AM-FM hearing can be held. It is impossible for me to see the legal justification or logical rationale, however, for granting the licenses subject to some sort of "condition." If the argument is to be advanced that RKO is somehow inconvenienced by having its licenses held in suspension in this way, it would seem to me [*994] to miss the mark. Our concern is supposed to be principally directed to the public's best interest, not the licensee's convenience.
If the Commission action here is premised on a future thorough investigation and evaluation of the reciprocity charges then today's renewal action would seem to be premature. If its future actions are only to follow automatically the results in the court case and the KHJ-TV renewal proceeding then the Commission is abdicating its responsibility. But one cannot tell what the Commission's intentions are from this renewal action. I dissent.
KFRC (AM)-KFMS (AM)
(AM) and KFMS (FM) are the RKO General stations in
grant is subject to whatever action the Commission may deem appropriate as a
result of developments and findings arising in the pending civil action
already detailed my views concerning renewal of RKO General stations in an
opinion dissenting to the renewals of KHJ-AM-FM,
reasons against conditional renewal for RKO's