Clarksburg Pub. Co. v. FEDERAL COMMUNICATIONS COM'N, 12441.

• Decision Date: 09 June 1955
• Docket Number: No. 12441.,12441.
• Citation: 225 F.2d 511,96 US App. DC 211
• Parties: CLARKSBURG PUBLISHING COMPANY, Appellant, v. FEDERAL COMMUNICATIONS COMMISSION, Appellee, Ohio Valley Broadcasting Corporation, Intervenor.
• Court: U.S. Court of Appeals — District of Columbia Circuit

96 US App. DC 211, 225 F.2d 511 (1955)

CLARKSBURG PUBLISHING COMPANY, Appellant, v. FEDERAL COMMUNICATIONS COMMISSION, Appellee, Ohio Valley Broadcasting Corporation, Intervenor.

No. 12441.

United States Court of Appeals District of Columbia Circuit.

Argued March 21, 1955.

Decided June 9, 1955.

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Messrs. Cecil B. Highland, Jr., and John S. Stump, Jr., Clarksburg, W. Va., both of the bar of the Supreme Court of Appeals of West Virginia, pro hac vice, by special leave of Court, with whom Mr. Edmund D. Campbell, Washington, D. C., was on the brief, for appellant.

Mr. Richard A. Solomon, Asst. Gen. Counsel, Federal Communications Commission, for appellee. Messrs. Warren E. Baker, Gen. Counsel, Federal Communications Commission, J. Smith Henley, Asst. Gen. Counsel, Federal Communications Commission, Harrison, Ark., and Warren D. Quenstedt, Atty., Federal Communications Commission, were on the brief for appellee.

Mr. Leonard H. Marks, Washington, D. C., with whom Mr. Paul Dobin, New York City, was on the brief, for intervenor.

Before EDGERTON, BAZELON and BASTIAN, Circuit Judges.

BAZELON, Circuit Judge.

Clarksburg Publishing Company owns a daily newspaper in Clarksburg, West Virginia. It protested the Federal Communications Commission's grant of a permit to the Ohio Valley Broadcasting Corporation¹ for the construction of a new commercial television station to operate on Channel 12 in Clarksburg. The protest asserted that the Commission's action was contrary to the public interest because the grant was made within one day after the mutually exclusive application of the Clarksburg Broadcasting Corporation² was withdrawn; and because it is inconsistent with (1) the rule prohibiting multiple ownership and control of television stations and (2) the Commission's policy of favoring diversification of all the media of mass communication. The protest also questioned the propriety of a payment of $14,390 by Ohio Valley to the Broadcasting Corporation at the time it withdrew. The protest was denied and Clarksburg brought this appeal.³

The question for review is whether the Commission erred in denying the protest. The denial constituted a determination that the grant to Ohio Valley served the public interest, convenience, and necessity. We conclude that denial rested on a seriously inadequate record and is, therefore, erroneous. Accordingly, we remand the case to the Commission for further hearing upon a reopened record.⁴

I. The Commission's Treatment of the Protest

The inadequacies of the record are directly attributable to the Commission's failure to follow the letter and spirit of § 309(c) which embodies the protest procedure of the Communications Act.⁵ That section, adopted as one of several amendments to the Act in 1952, was fitted into the statutory scheme "to make definite and certain the procedural rights and remedies of those who oppose, as well as those who apply for" a license.⁶ It added specific authorization for protesting any grant made without hearing and requires the Commission to re-examine its action in a hearing upon protest by a "party in interest" who alleges "with particularity the facts, matters, and things relied upon".⁷

The Commission found — and we agree — that Clarksburg's protest met both the "party in interest"⁸ and "particularity" requirements of § 309(c). But the Commission accepted the facts alleged in the protest as if admitted by demurrer and limited the "hearing" to oral argument. In the circumstances of this case, we think this procedure did not satisfy the statutory command.

Section 309(c) provides that issues upon which a hearing is indicated should be "tried" according to the procedure prescribed by § 309(b). The latter section, which is also applicable to hearings upon denial of a grant, calls for a "full hearing" and, like 309(c), refers to the "burden of proceeding with the introduction of evidence" and the "burden of proof." Congress could not have expressed in plainer words its intent that, where there are unresolved factual issues, the hearing should be of an evidentiary nature.

Section 309(c) also provides that if, as here, the Commission finds that the protest meets the "party in interest" and "particularity" requirements, "the application involved shall be set for hearing upon the issues set forth in said protest, together with such further specific issues, if any, as may be prescribed by the Commission."⁹

The statute contemplates that, in appropriate cases, the Commission's inquiry will extend beyond matters alleged in the protest in order to reach any issue which may be relevant in determining the legality of the challenged grant. Clearly, then, the inquiry cannot be limited to the facts alleged in the protest where the Commission has reason to believe, either from the protest or its own files, that a full evidentiary hearing may develop other relevant information not in the possession of the protestant. Here, as will fully appear from the discussion which follows, the Commission had ample reason for extending the inquiry. Nevertheless, by adopting the technical demurrer approach, it precluded such development and confined itself to a consideration of the facts and issues set forth in the protest. However unwittingly, the Commission seems to have assumed the defense of its grant, rather than the public interest, as its primary role in the proceedings.

We turn now to discuss the various respects in which the record is deficient for the purpose of determining the legality of the grant to Ohio Valley.

The Alleged Conflict with the Multiple Ownership Rule

Protestant claims that Ohio Valley will have direct or indirect ownership interest in two television stations in the same community by reason of (1) the substantial overlap of the service areas of the proposed Clarksburg station and WTRF-TV in Wheeling (58 miles northwest of Clarksburg), both of which are controlled by the same interests;¹⁰ and (2) the reception in the city of Clarksburg of an excellent signal from WTRF-TV by means of two community antenna cable services. Ohio Valley's interest is said to constitute a violation of that portion of the Commission's multiple ownership rule which bars the grant of a license to a party who "directly or indirectly owns, operates, or controls another television broadcast station which serves substantially the same area."¹¹ This rule is an expression of the Commission's policy of promoting diversification of control of the mass media of communication.

That the service areas of the two stations overlap is clear.¹² The Commission found that a common area of 16,870 square miles would be served with a Grade B signal from both stations. It concluded, however, that no overlap of the Grade A contours of the stations existed. Presumably this conclusion was based on the February 12 amendment to Ohio Valley's application in which the effective radiated power of the proposed station was reduced from 50.6 to 4 kilowatts.¹³ At the reduced power, according to the affidavit of Ohio Valley's engineer, there was no overlap, but in fact a two-mile separation between the Grade A contours of the stations.¹⁴

Treating only a Grade A overlap as decisive in applying Rule 3.636(a) (1), the Commission concluded that the stations did not, by virtue of Grade B overlap, serve substantially the same area. No reason is supplied for the mechanical application of the Grade A-Grade B rule, but it is apparently based on the assumption that the degree and quality of service within the Grade B contour are not sufficiently susceptible of definite measurement to justify considering that service for purposes of overlap. Whether or not this assumption is sound in the present state of development of the engineering art cannot be concluded from this record. Where, as here, the Grade B overlap is substantial (and, indeed, the Grade A contours are barely separated), it seems a fair assumption that receivers in the area of overlap would receive acceptable signals from both stations. If this is true, and to the extent that it is, the Commission's own rule would seem to dictate that the overlap be considered. Nothing in this record tells us why the Commission decided that the instant Grade B overlap would not constitute serving "substantially the same area" within the meaning of the rule.

Community Antenna Television Systems

In determining the overlap question, the Commission refused to consider the service provided by two privately owned community television antenna systems which carry the programs of WTRF-TV to Clarksburg.¹⁵ These systems are a comparatively new development in the short history of television and their operation in this case poses a novel question in interpreting 3.636(a) (1).

Our review of this aspect of the case is frustrated by the absence of any evidence in the record as to the character of these systems,¹⁶ their regulatory status, the manner in which they are owned and operated, the arrangements made for the broadcast of programs, and the nature of the relationship between those in control of the systems and the stations whose programs they carry.¹⁷ That these problems are unresolved in the Commission's mind is apparent from the fact that it has not as yet determined the extent of its jurisdiction over community antenna services.¹⁸

The Commission will presumably assert jurisdiction to regulate community antenna systems if and when it concludes that such systems provide or are adjuncts of a broadcast service. Its failure thus far to assert such jurisdiction, standing by itself, cannot support a conclusion that the systems are not service within the meaning of the rule. It is unrealistic to overlook the fact that, through the community systems, Clarksburg residents are receiving and are, in a sense, being served by the programs of the Wheeling station. To the extent that this reinforces the voice of Ohio Valley in the city of Clarksburg, it would appear to...