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06/05/87 Fiesta Productions, Inc., v. Federal Communications

UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT


June 5, 1987

FIESTA PRODUCTIONS, INC., APPELLANT

v.

FEDERAL COMMUNICATIONS COMMISSION, APPELLEE, ELLIOTT-PHELPS BROADCASTING LIMITED PARTNERSHIP, INTERVENOR 1987.CDC.221

Before: MIKVA and WILLIAMS, Circuit Judges, and WEIGEL,* Senior District Judge.

UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT

Rules of the District of Columbia Circuit Court of Appeals may limit citation of unpublished opinions. Please refer to the Rules of the United States Court of Appeals for this Circuit.

NOTICE OF APPEAL FROM AN ORDER OF THE FEDERAL COMMUNICATIONS COMMISSION.

APPELLATE PANEL:

Appellant Fiesta Productions, Inc., contends that the Federal Communications Commission acted arbitrarily and capriciously in refusing to reopen a licensing proceeding for an AM station in Tucson, Arizona. Fiesta alleges that the victorious applicant, Elliott-Phelps Broadcasting Limited Partnership, violated the FCC's requirements of reasonable assurance of a transmitter site, of accuracy under 47 C.F.R. § 1.65 (1986), and of candor (to the extent any candor requirement may exist independently of § 1.65). We find that the Commission acted within the bounds of its discretion and therefore affirm.

The transmitter site was formerly owned by a deleted station and contained transmitting facilities. The site was acquired by Cima Partnership, an entity closely related to one of the competing applicants in the proceeding, CIMA Broadcasting Limited Partnership. Despite CIMA Partnership's ownership, Elliott-Phelps specified this transmitter site in its application pursuant to the Commission's rule giving a conclusive presumption of availability in cases in which one applicant has purchased deleted facilities. See New Continental Broadcasting Co., 45 Rad. Reg. 2d 1632, 1633 (1979).

The Administrative Law Judge found that the New Continental rule applied, CIMA Broadcasting Limited Partnership, FCC 83M-2379 (released July 21, 1983), and subsequently granted the application of Elliott-Phelps, CIMA Broadcasting Limited Partnership, FCC 84D-35 (released May 25, 1984). CIMA and Fiesta appealed this decision to the Review Board, but on February 22, 1985 (prior to the Board's decision) CIMA and Elliott-Phelps arrived at a settlement in which CIMA withdrew its application in return for $50,000. Joint Appendix at 171. The settlement agreement also provided for sale of CIMA's transmitting equipment to Elliott-Phelps and for removal of the equipment within 90 days at CIMA's request. The Board approved this settlement agreement and rejected Fiesta's challenge in CIMA Broadcasting Limited Partnership, FCC 85R-27 (released March 28, 1985).

In February 1986 Fiesta informed the Commission, in a petition to reopen the record and enlarge the issues, J.A. at 42, that it had discovered that the site designated by Elliott-Phelps had been sold by CIMA Partnership to Cienega, Ltd., shortly before the Review Board's decision was released. In reply, Elliott-Phelps submitted a sworn by Robert A. Elliott, a partner in the enterprise, J.A. at 270, to the effect that during negotiations between CIMA Partnership and Cienega for the sale, he had received assurances from Cienega that Elliott-Phelps would be permitted to use the site until the property was developed. Development would require rezoning, and this process was expected to take at least two years. Elliott stated that after the sale was concluded, he received further assurances from Cienega of the continued availability of the site. He admitted to making contingency arrangements for an alternative site. A statement from a Cienega official substantially confirmed Elliott's account of his dealings with Cienega. J.A. at 274. In Fiesta Productions, Inc., FCC 86-278 (released June 6, 1986), the full Commission denied Fiesta's petition and found that Fiesta had not rebutted Elliott's explanation.

We agree with the Commission. The Commission's decision to extend the New Continental doctrine to Elliott-Phelp's situation was well within its discretion. Likewise, the Commission's willingness to credit Elliott's version of events was not unreasonable. Fiesta attempts to make much of slight ambiguities in the statement from the Cienega representative and in the settlement agreement, but such ambiguities are insufficient to undermine the Commission's determination.

It is true that the assurances received by Elliott-Phelps after the sale of the transmitter property were limited -- in the worst case, Elliott-Phelps would be evicted in two years. We confess to some surprise that the FCC, once having created the site availability requirement, has chosen to construe it so loosely. Why have such a hurdle at all, if it is to be set so low? Fiesta has cited two Commission decisions suggesting that transmitter sites should ordinarily be available for at least several years. Cabrillo Broadcasting Co., 24 Rad. Reg. 608, 613 (Rev. Bd. 1962) ("It is sufficient that [the site] be available for the period for which the license is sought."); Continental Broadcasting Corp., 18 Rad. Reg. 826, 828 (1959) ("According to the affidavit . . ., the site will be available for at least several years.") However, neither these cases nor any other authority called to our attention clearly delineates a firm time limitation for satisfaction of the reasonable assurance requirement. Indeed, the Cabrillo opinion itself makes clear that a site will be considered available even though its use for a transmitter requires a zoning change and even if that change is "unlikely," 24 Rad. Reg. at 613, and the Continental decision states, "All that can be deduced from the pleadings is that the site is presently available, which is of prime importance," 18 Rad. Reg. at 828. In view of the apparent flexibility of the reasonable assurance doctrine we cannot say the Commission erred in failing to insist on more.

Further, in view of that flexibility and the Review Board's approval of the Elliott-Phelps application despite notice from the settlement agreement that Elliott-Phelps might be required to depart the site on 90 days' notice, we cannot say that Elliott-Phelps violated the Commission's requirements of candor and accuracy in failing to inform it of the changing circumstances. See Washington Ass'n for Television & Children v. FCC, 665 F.2d 1264, 1270 (D.C. Cir. 1981) (indicating a high degree of deference to FCC candor determinations).

Accordingly, the Commission's decision is Affirmed.

JUDGMENT

This appeal was considered on the record from the Federal Communications Commission and was briefed and argued by counsel for the parties. The court has reviewed the issues presented and has determined that the case occasions no need for a published opinion. See D.C. Cir. R 13(c). For the reasons stated in the accompanying memorandum, it is

ORDERED and ADJUDGED, by this Court, that the judgment from which this appeal has been taken be affirmed. It is

FURTHER ORDERED, by this court, sua sponte, that the Clerk shall withhold issuance of the mandate herein until seven days after disposition of any timely petition for rehearing. See Local Rule 14, as amended on November 30, 1981 and June 15, 1982. This instruction to the Clerk is without prejudice to the right of any party at any time to move for expedited issuance of the mandate for good cause shown.

PER CURIAM DECISION

APPELLATE PANEL: FOOTNOTES

* Of the United States District Court for the Northern District of California, sitting by designation pursuant to 28 U.S.C. § 294(d).

19870605

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