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08/16/74 Greensboro Television v. Federal Communications

August 16, 1974





Petition for Review of an Order of the Federal Communications Commission.


Leventhal and Robb, Circuit Judges and Matthews,* Senior United States District Judge for the United States District Court for the District of Columbia.


Opinion for the Court filed by Circuit Judge ROBB.

ROBB, Circuit Judge:

WFMY Television Corporation applied to the Federal Communications Commission (Commission) for renewal of the license of television broadcasting station WFMY-TV, Channel 2, Greensboro, North Carolina. The appellant, Greensboro Television Company (Greensboro), filed a competing application for a construction permit for a new television broadcasting station to operate on the same channel. Thereafter, following developments which we shall discuss later in this opinion, Greensboro and WFMY submitted to the Commission an agreement whereby Greensboro would dismiss its application and in return would be reimbursed for its expenses, not to exceed $44,195.00, by WFMY. The Commission refused to approve the agreement on the ground that it was not consistent with the public interest. 33 FCC2d 857, reconsideration denied, 37 FCC2d 339. Greensboro appeals, contending that the Commission's refusal was arbitrary. The case comes to this court pursuant to 47 U.S.C. ยง 402(b). See Tomah-Mauston Broadcasting Co. v. FCC, 113 U.S. App. D.C. 204, 306 F.2d 811 (1962). We affirm the Commission. I.

A chronological recital of relevant events will clarify the issue before us.

*fn1. Greensboro filed its application on November 3, 1969.

2. On January 15, 1970 the Commission issued its POLICY STATEMENT ON COMPARATIVE HEARINGS INVOLVING REGULAR RENEWAL APPLICANTS. 22 FCC2d 424 (1970). In that Statement the Commission announced its policy to be: "that if the applicant for renewal of license shows in a hearing with a competing applicant that its program service during the preceding license term has been substantially attuned to meeting the needs and interests of its area, and that the operation of the station has not otherwise been characterized by serious deficiencies, he will be preferred over the newcomer and his application for renewal will be granted." [footnote omitted.] Under this policy, said the Commission, "If the Examiner, at the conclusion of the initial phase of a hearing dealing with a renewal applicant's past record, has no doubt that the existing licensee's record of service to the public is a substantial one, without serious deficiencies, he should, either on his own motion or that of the renewal applicant, halt the proceeding at this point and issue an initial decision based upon that determination." The Statement also announced that "as a general matter, the renewal process is not an appropriate way to restructure the broadcast industry" by bringing about a diversification of the media of mass communications. The Commission's view was that the question of diversification should be the subject of general rulemaking proceedings rather than ad hoc decisions in renewal hearings. This view was emphasized by the Commission when on April 6, 1970 it issued a FURTHER NOTICE OF PROPOSED RULEMAKING (Docket No. 18, 110) which concerned the divestiture of broadcast properties by commonly owned newspapers in the same market.

3. On March 18, 1970 Greensboro filed a petition to designate as issues for hearing whether WFMY had failed to ascertain the needs and interests of the area it served and whether the grant of WFMY's application would result in undue concentration of control of the regional media by the parent company of WFMY. The Commission took no action on this petition.

4. On July 7, 1970 the Commission released its decision in National Broadcasting Co., Inc., 24 FCC2d 218 (1970), approving an agreement for the withdrawal of a new application, with payment by the renewal applicant of the expenses of the challenger. On November 16, 1970 the Commission released a similar decision in Post-Newsweek Stations, Fla., Inc., 26 FCC2d 982 (1970).

5. On May 28, 1971 Greensboro and WFMY filed their joint petition for approval of their agreement for the withdrawal of the Greensboro application upon payment of Greensboro's expenses by WFMY. The joint petition averred that Greensboro had filed its competing application on the assumption that it would be accorded a comparative hearing in which such factors as ascertainment of community needs, diversification of media ownership, integration of ownership and management, and local management would be litigated. On this premise also, said the petition, Greensboro had filed its petition of March 18, 1970 to designate issues for hearing; but Greensboro had now decided that its case had been substantially weakened by the Commission's Policy Statement of January 15, 1970, and by extensive amendment to WFMY's application. Accordingly, in the light of the Commission's decisions in National Broadcasting Co., Inc. (supra) and Post-Newsweek Stations, Fla., Inc. (supra) the petition submitted that reimbursement of Greensboro should be approved.

The petition referred to the statement in n.7 in the Commission's Policy Statement "that barring extraordinary circumstances, the challenger to a renewal cannot be reimbursed in any amount for his expenditures in preparing and prosecuting his application." The petitioners submitted that the Commission's Policy Statement of January 15, 1970 was ...

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