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01/17/72 Westminster Broadcasting v. Federal Communications

January 17, 1972





Corporation, Intervenors 1972.CDC.9


Bazelon, Chief Judge and McGowan, Circuit Judge, and Christensen,* United States Senior District Judge for the District of Utah.


Appellant Westminster Broadcasting Corporation seeks review of a Federal Communications Commission order denying, without hearing, its petition to deny the application of a competitor to transfer its license to a third party.

Westminster is the licensee of Station KCMJ, one of three licensed AM radio stations in the Palm Springs, California area. KCMJ has been broadcasting since 1946, and has been operated by appellant since 1961. Station KPAL, one of the other two stations, has been operating since 1956. The individual principally involved in the ownership and operation of KPAL, Mr. Harry Maizlish, died on March 24, 1969. On April 25, 1969, the Commission granted authorizations to the administrators of Mr. Maizlish's estate to permit KPAL to remain silent for ninety days, and these were continued through May 10, 1971. On September 10, 1969, the administrators petitioned the Commission for authority to transfer the license of KPAL to R. R. Moore Corporation, the intervenor in this case. Westminster petitioned to deny this authority on November 13, 1969, on the ground, inter alia, that the market in Palm Springs lacked sufficient revenues to support three radio stations, and that under this court's decision in Carroll Broadcasting Co. v. FCC, 103 U.S.App.D.C. 346, 258 F.2d 440 (1958), the public interest requires a denial of the transfer. On October 5, 1970, the Commission, without hearing, issued a memorandum opinion and order granting KPAL's petition to transfer its license and denying Westminster's petition to deny. *fn1

The Federal Communications Act *fn2 requires the Commission to grant a hearing to any party in interest opposing the grant of an application who presents a "substantial and material question of fact" with respect to whether the application would be inconsistent with the "public interest, convenience, and necessity." This court held in Carroll that the Commission may not refuse to consider a substantial showing by an opponent of a new license that the market revenues of an area are so limited as to make the appearance of a new station likely to result in a net deterioration of service. While not disagreeing with the Commission that the Act does not protect existing licensees from competition -- even competition from a new licensee that may drive the existing licensee out of business -- we held that

". . . if the situation in a given area is such that available revenue will not support good service in more than one station, the public interest may well be in the licensing of one rather than two stations. To license two stations where there is revenue for only one may result in no good service at all. So economic injury to an existing station, while not in and of itself a matter of moment, becomes important when on the facts it spells diminution or destruction of service." 103 U.S.App.D.C. at 349, 258 F.2d at 443.

However, the mere allegation by an existing licensee of insufficient market revenues and predicted diminution of service is not in itself sufficient to present a substantial Carroll question meriting an evidentiary hearing under the Act. We have also recognized that

". . . the temptation to an existing licensee to postpone as long as possible the advent of competition warrants special care by the Commission in the scrutiny of requests for hearing in Carroll circumstances." Southwestern Operating Company v. FCC, 122 U.S.App.D.C. 137, 138, n. 2, 351 F.2d 834, 835 n. 2 (1965);

and that

". . . the Commission is entitled to insist upon more than conclusional allegations easily made and which, if accepted, entail unjustified delay and consumption of the Commission's time and energy." Folkways Broadcasting Co. v. FCC, 126 U.S.App.D.C. 123, 127, 375 F.2d 299, 303 (1967).

The question therefore, in this case is whether appellant's petition to the Commission presented a sufficiently substantial claim to entitle appellant to an evidentiary hearing.

In some cases a difficult balance must be struck between the need to require more than conclusory allegations, on the one hand, and the danger of frustrating meritorious claims by the imposition of formalistic and often unrealistic pleading requirements, on the other. See Folkways Broadcasting (supra). Striking that balance is particularly difficult with respect to Carroll claims, where an attempt to show that an additional station will result in a net deterioration of service necessarily involves predictive and hypothetical judgments. Recognizing these difficulties, and at the same time recognizing that proper deference must be given to the opinion of the Commission in light of its special ...

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