In Re Application of A.H. BELO CORP., ASSIGNEE and BEAUMONT TELEVISION CORP., ASSIGNOR A.H. BELO CORP., TRANSFEROR and JAMES M. MORONEY, JR., JOSEPH M. DEALEY AND MYRON F. SHAPIRO, VOTING TRUSTEES
For assignment of license of Stations WFAA-AM-FM-TV and for transfer of control of Beaumont Television Corp.
FEDERAL COMMUNICATIONS COMMISSION
41 F.C.C.2d 245
RELEASE-NUMBER: FCC 73-544
MAY 23, 1973
[*245] MR. JAMES M. MORONEY, JR., A.H. Belo Corp., Communications Center, Dallas, Tex. 75222 MR. MYRON F. SHAPIRO, Beaumont Television Corp., Communications Center, Dallas, Tex. 75222
GENTLEMEN: This refers to the pro forma applications for assignment of license of WFAA-AM-FM-TV, Dallas, Texas from A.H. Belo Corporation to Beaumont Television Corporation (BAPL-430; BALH-156; BALCT-505) and for transfer of control of Beaumont Television Corporation, licensee of KFDM-TV, Beaumont, Texas from A.H. Belo Corporation to James M. Moroney, Jr., Joseph M. Dealey and Myron F. Shapiro, Voting Trustees (BTC-7073) which were granted today. This also refers to informal complaints filed by WADECO, Inc. and Civic Telecasting Corporation against the subject applications and your responses thereto.
As you are aware, the license renewal applications of the subject stations have been in deferred status; WADECO, Inc. has filed an application mutually exclusive with the renewal application for WFAA-TV; and Civic Telecasting has filed a Petition to Deny the license renewal applications for all the subject stations.
We have considered the complaints and your responses solely in the context of these pro forma applications and have determined that a grant of them would serve the public interest. In making this determination we have also considered the question raised by WADECO, Inc. in its informal complaint regarding possible improvement of WFAA-TV's comparative position in the area of [*246] integration of ownership and management in the comparative renewal proceeding. As we have informed counsel for WADECO, Inc., a renewal applicant such as WFAA-TV is judged in this area solely on the basis of its past performance, and not on its integration of ownership and management. A copy of our letter to counsel for WADECO, Inc. is enclosed. Further, the grant of these applications has been made without prejudice to whatever action we may deem appropriate with regard to the pending license renewal applications.
BY DIRECTION OF THE COMMISSION, BEN F. WAPLE, Secretary.
CONCURRING STATEMENT OF COMMISSIONER H. REX LEE
A. H. Belo Corporation, licensee of Stations WFAA-AM-FM-TV in Dallas, Texas, n1 has filed applications on FCC Form 316 (Short Form or Pro Forma) for: (1) assignment of the station licenses to its wholly-owned subsidiary, Beaumont Television Corporation (licensee of Station KFDM-TV, Beaumont, Texas); n2 and (2) transfer [*247] of control of Beaumont Television from Belo to three voting trustees, James M. Moroney, Jr., Joseph M. Dealey and Myron F. Shapiro. At present, 68.65% of Belo's stock is owned by the G. B. Dealey Trust, a testamentary trust, and is voted by Moroney, Dealey and Joseph A. Lubben as trustees. Belo now proposes to assign its broadcast licenses to Beaumont Television and to place all of the subsidiary's stock in a voting trust, which will have Moroney, Kealey and Shapiro as trustees and which will last until December 31, 1982. Belo maintains that control of the licensee will not change with these transactions since Moroney and Dealey effectively exercise control over the broadcast stations through the G. B. Dealy Trust interest in Belo and since they will continue to exercise such control under the proposed arrangement. In regard to the purpose of the applications, Moroney and Dealey represent that the proposed assignment of licenses and transfer of control of Beaumont Television are intended to preserve control over the broadcast stations beyond termination of the G. B. Dealey Trust, which expires in 1975; that the applications are not intended to, and will not have the effect of changing the existing control of the stations and of Belo during the life of the G. B. Dealey Trust; and that each trustee intends to continue in such capacity under both trusts until terminated.
n1 Belo also publishes the Dallas Morning News (daily and Sunday newspapers) and a number of suburban newspapers in the Dallas area.
n2 In 1969, the Commission approved transfer of control or Beaumont Television from stockholders of Beaumont Broadcasting Corporation to Belo. See 17 FCC 2d 577, 16 RR 2d 93.
Civic Telecasting Corporation, whose principals were previously involved in the operation of UHF television Station KMEC-TV in Dallas, has objected to grant of the applications. It argues that the proposed arrangement will result in a substantial change in the control of the stations and that there is no reasonable or legitimate purpose for the overall plan. Civic Telecasting contends that the applications represent an attempt by Belo to avoid the possible revocation of its broadcast licenses as a result of a civil antitrust action brought against Belo and other parties, charging the defendants with monopolizing the television industry in the Dallas-Fort Worth area and discriminating against KMEC-TV through their newspaper interests. n3 Civic Telecasting has petitioned to deny the license renewal applications of Belo on essentially the same grounds raised in the antitrust action. n4
n3 See UHF, Inc. v. The Times Herald Printing Company, T.H. Liquidating Company and the A. H. Belo Corporation, Civil Action No. 3-4156-A, filed September 9, 1970, in the United States District Court for the Northern District of Texas, Dallas Division.
n4. Action on the petition to deny is being deferred until the Commission has received sufficient information relating to the allegations made in the civil antitrust suit and the petition to deny to permit the discharge of its statutory responsibilities. The Commission has simultaneously designated the WFAA-TV renewal application for hearing along with the competing application of WADECO, Inc. and has conditioned any grant of the WFAA-TV renewal application on whatever action may be appropriate as a result of the Court's decision in the Texas antitrust action.
As the Commission points out in its letter rejecting Civic Telecasting's objections, there appears to be a legitimate purpose for the filing of the applications, and the complainant has not demonstrated how the proposed arrangement will enable Belo to avoid the consequences of its stewardship of the broadcast stations or related business activities. Moreover, Belo has expressly disclaimed any intent to evade [*248] responsibility for the operation of its stations and newspaper interests. On the basis of such representations and the fact that the Commission would have to approve any actual transfer of control of the licensee, I have concurred in the grant of the applications. However, I intend to remain alert for any indication that Belo's purpose in filing the applications was to avoid possible impact on its broadcast licenses that might result from an adverse resolution of the civil antitrust action in Texas.
OPINION OF COMMISSIONER NICHOLAS JOHNSON, CONCURRING IN PART AND DISSENTING IN PART
While I concur with that portion of the majority's opinion which designates a comparative hearing on the mutually exclusive application of A.H. Belo Corporation and WADECO, Inc., to operate on channel 8, Dallas, Texas, I cannot agree with the majority that the accompanying assignments and transfers of control serve the public interest.
Rather, I tend to agree with WADECO that these intricate assignments appear designed as a means to improve the comparative position of the current WFAA-TV licensee. I can perceive no other cogent purpose for these assignments, and despite the majority's language suggestion that the position of WFAA's licensee will not be so improved, I must admit that I have my doubts. For, sadly, such assurances are often mere words -- words whose intent is easily lost through the months of hearings which follow FCC designation orders.
In short, while I am not at all persuaded that these assignment transactions serve the "public interest, convenience or necessity," I am also fearful that their real intent will return to haunt not only WADECO and not only those parties who have filed petitions to deny against WFAA's license renewal applications, but also this Commission.