Federal Communications Commission DA 09-2229 Before the Federal Communications Commission Washington, D.C. 20554 In re Application of Universal Broadcasting, Inc. For Renewal of License for Station KQLO(AM) Sun Valley, Nevada ) ) ) ) ) ) ) Facility I.D. No. 38456 NAL/Acct. No. MB-200941410022 FRN: 0018171942 File No. BR-20081029ACD MEMORANDUM OPINION AND ORDER AND NOTICE OF APPARENT LIABILITY FOR FORFEITURE Adopted: October 15, 2009 Released: October 16, 2009 By the Chief, Audio Division, Media Bureau: I. INTRODUCTION 1. The Commission has before it the captioned application of Universal Broadcasting, Inc. (the “Licensee”), for renewal of its license for Station KQLO(AM), Sun Valley, Nevada (the “Station”). In this Memorandum Opinion and Order and Notice of Apparent Liability for Forfeiture (“NAL”) issued pursuant to Sections 309(k) and 503(b) of the Communications Act of 1934, as amended (the “Act”), and Section 1.80 of the Commission’s Rules (the “Rules”),1 by the Chief, Audio Division, Media Bureau, by authority delegated under Section 0.283 of the Rules,2 we find that the Licensee apparently willfully violated Section 73.3539 of the Rules,3 by failing to file a timely license renewal application for the Station, and apparently willfully and repeatedly violated Section 301 of the Act,4 by engaging in unauthorized operation of the Station after its authorization had expired. Based upon our review of the facts and circumstances before us, we conclude that the Licensee is apparently liable for a monetary forfeiture in the amount of seven thousand dollars ($7,000), and we grant the captioned KQLO(AM) renewal application. II. BACKGROUND 2. Section 73.3539(a) of the Rules requires that applications for renewal of license for broadcast stations must be filed “not later than the first day of the fourth full calendar month prior to the expiration date of the license sought to be renewed.”5 An application for renewal of KQLO(AM)’s license should have been filed by June 1, 2005, four months prior to the Station’s October 1, 2005, license expiration date,6 but was not. In fact, the Licensee did not file the renewal application until October 29, 1 47 U.S.C. §§ 309(k), 503(b); 47 C.F.R. § 1.80. 2 See 47 C.F.R. § 0.283. 3 See 47 C.F.R. § 73.3539. 4 See 47 U.S.C. § 301. 5 47 C.F.R. § 73.3539(a). 6 See 47 C.F.R. §§ 73.1020, 73.3539(a). Federal Communications Commission DA 09-2229 2 2008. On that same date, the Licensee filed a request for special temporary authorization (“STA”) to continue Station operations pending consideration of the late-filed renewal application.7 The staff granted the STA Request on November 5, 2008, and it expired on May 4, 2009.8 The Licensee did not seek extension of the STA.9 In the STA Request, the Licensee indicated that it inadvertently failed to file the renewal application and two years later fell into bankruptcy, with Ms. Annabelle Savage appointed as Trustee.10 III. DISCUSSION 3. Proposed Forfeiture. In this case, the Licensee has failed to file a timely license renewal application for KQLO(AM) as required by Section 73.3539(a) of the Rules. Moreover, it continued Station operation for more than three years after its license had expired on October 1, 2005, before filing the appropriate renewal application and seeking STA to so operate, in violation of Section 301 of the Act. It also continued Station operations for more than five months after the STA expired, an additional violation of Section 301 of the Act. Licensees are obligated to comply fully with the Rules, including filing a timely renewal application and maintaining in effect the station’s authorization.11 Here, the Licensee did not do so. 4. This NAL is issued pursuant to Section 503(b)(1)(B) of the Act. Under that provision, any person who is determined by the Commission to have failed willfully or repeatedly to comply with any provision of the Act or any rule, regulation, or order issued by the Commission shall be liable to the United States for a forfeiture penalty.12 Section 312(f)(1) of the Act defines willful as “the conscious and deliberate commission or omission of [any] act, irrespective of any intent to violate” the law.13 The legislative history to Section 312(f)(1) of the Act clarifies that this definition of willful applies to both Sections 312 and 503(b) of the Act,14 and the Commission has so interpreted the term in the Section 503(b) context.15 Section 312(f)(2) of the Act provides that “[t]he term ‘repeated,’ when used with reference to the commission or omission of any act, means the commission or omission of such act more than once or, if such commission or omission is continuous, for more than one day.”16 7 See File No. BLSTA-20081029ACG (the “STA Request”). 8 Letter to Mr. Brian M. Madden, Esq., Ref. 1800B3 (Chief, Audio Division, Media Bureau, November 5, 2008). 9 On May 1, 2009, the Licensee requested STA to remain silent, File No. BLSTA-20090501AOU. This silent STA request was dismissed on July 8, 2009, when the licensee reported that the Station had returned to the air. 10 Also on October 29, 2008, the Licensee filed an application (BTC-20081029ACF) to transfer control from its shareholders to Ms. Savage as Trustee. The staff granted that application on November 4, 2008. 11 See, e.g, Hemmingford Media, Inc., Forfeiture Order, 14 FCC Rcd 2940, 2941-2 (CIB 1999) (responsibility for complying with terms of station license “rests solely and exclusively with the licensee”) (citing Empire Broadcasting Corp., Memorandum Opinion and Order, 25 FCC 2d 68 (1970)). 12 47 U.S.C. § 503(b)(1)(B). See also 47 C.F.R. 1.80(a)(1). 13 47 U.S.C. § 312(f)(1). 14 See H.R. Rep. No. 97-765, 97th Cong. 2d Sess. 51 (1982). 15 See Southern California Broadcasting Co., Memorandum Opinion and Order, 6 FCC Rcd 4387, 4388 (1991). 16 47 U.S.C. § 312(f)(2). Federal Communications Commission DA 09-2229 3 5. The Commission's Forfeiture Policy Statement and Section 1.80(b)(4) of the Rules establish a base forfeiture amount of $3,000 for the failure to file a required form.17 The guidelines also specify a base forfeiture amount of $10,000 for construction and/or operation without an instrument of authorization for the service.18 In determining the appropriate forfeiture amount, we may adjust the base amount upward or downward by considering the factors enumerated in Section 503(b)(2)(D) of the Act, including “the nature, circumstances, extent and gravity of the violation, and, with respect to the violator, the degree of culpability, any history of prior offenses, ability to pay, and such other matters as justice may require.”19 6. In this case, the Licensee failed to file a timely renewal application and continued Station operations for more than three years before filing the appropriate renewal application and request for STA to so operate and for more than five additional months after its STA had expired. Nevertheless, because it had previously been licensed to operate Station KQLO(AM), the latter transgression is not comparable to "pirate" wireless operations, which typically have been subject to forfeitures of approximately $10,000. Taking into consideration these facts and all of the factors required by Section 503(b)(2)(D) of the Act and the Forfeiture Policy Statement, we propose a forfeiture for the full $3,000 amount for the failure to file a timely renewal application and STA request, but reduce the proposed forfeiture for the unauthorized operation from the $10,000 base amount to $4,000.20 Thus, we propose a forfeiture in the total amount of $7,000.21 7. License Renewal Application. In evaluating an application for license renewal, the Commission’s decision is governed by Section 309(k) of the Act.22 That section provides that if, upon consideration of the application and pleadings, we find that (1) the station has served the public interest, convenience, and necessity; (2) there have been no serious violations of the Act or the Rules; and (3) there have been no other violations which, taken together, constitute a pattern of abuse, we are to grant the renewal application.23 If, however, the licensee fails to meet that standard, the Commission may deny the application – after notice and opportunity for a hearing under Section 309(e) of the Act – or 17 See Forfeiture Policy Statement and Amendment of Section 1.80(b) of the Rules to Incorporate the Forfeiture Guidelines, Report and Order, 12 FCC Rcd 17087, 17113-15 (1997) ("Forfeiture Policy Statement"), recon. denied, 15 FCC Rcd 303 (1999); 47 C.F.R. § 1.80(b)(4), note to paragraph (b)(4), Section I. 18 A broadcast station requires an authorization from the Commission to operate. See 47 U.S.C. § 301. 19 47 U.S.C. § 503(b)(2)(D); see also Forfeiture Policy Statement, 12 FCC Rcd at 17100; 47 C.F.R. § 1.80(b)(4). 20 See, e.g., Discussion Radio Incorporated, Memorandum Opinion and Order, 19 FCC Rcd 7433, 7438 (2004); Gospel Media, Inc., Letter, 19 FCC Rcd 15600 (MB 2004). Although in Gospel Media, the Bureau imposed a proposed forfeiture of $3,000 for unauthorized operation, the unauthorized operation lasted only two weeks. The $4,000 forfeiture proposed here for unauthorized operation is analogous to use of an unauthorized frequency by a land mobile station holding a license for a different frequency. See, e.g., In the Matter of Dave Mitchell, 20 FCC Rcd (EB 2005); In the Matter of Joselyn Gordon, Forfeiture Order, 19 FCC Rcd 23557 (EB 2004). 21 See, e.g., Widener University, Memorandum Opinion and Order and Notice of Apparent Liability for Forfeiture, 23 FCC Rcd 375 (MB 2008) ($7,000 NAL issued for failure to file timely renewal application and unauthorized operation). 22 47 U.S.C. § 309(k). 23 47 U.S.C. § 309(k)(1). The renewal standard was amended to read as described by Section 204(a) of the Telecommunications Act of 1996, Pub. L. No. 104-104, 110 Stat. 56 (1996). See Implementation of Sections 204(a) and 204(c) of the Telecommunications Act of 1996 (Broadcast License Renewal Procedures), Order, 11 FCC Rcd 6363 (1996). Federal Communications Commission DA 09-2229 4 grant the application “on terms and conditions that are appropriate, including a renewal for a term less than the maximum otherwise permitted.”24 8. We find that the Licensee’s violations of Section 73.3539 of the Rules and Section 301 of the Act do not constitute “serious violations” warranting designation for evidentiary hearing. Moreover, we find no evidence of violations that, when considered together, constitute a pattern of abuse.25 Further, we find that Station KQLO(AM) served the public interest, convenience, and necessity during the subject license term. We will, therefore, grant the license renewal application below. IV. ORDERING CLAUSES 9. Accordingly, IT IS ORDERED, pursuant to Section 503(b) of the Communications Act of 1934, as amended, and Section 1.80 of the Commission’s Rules, that Universal Broadcasting, Inc. is hereby NOTIFIED of its APPARENT LIABILITY FOR FORFEITURE in the amount of seven thousand dollars ($7,000) for its apparent willful violation of Section 73.3539 of the Commission’s Rules and apparent willful and repeated violation of Section 301 of the Communications Act of 1934, as amended. 10. IT IS FURTHER ORDERED, pursuant to Section 1.80 of the Commission’s Rules, that, within thirty (30) days of the release date of this NAL, Universal Broadcasting, Inc. SHALL PAY the full amount of the proposed forfeiture or SHALL FILE a written statement seeking reduction or cancellation of the proposed forfeiture. 11. Payment of the proposed forfeiture must be made by check or similar instrument, payable to the order of the Federal Communications Commission. The payment must include the NAL/Acct. No. and FRN No. referenced in the caption above. Payment by check or money order may be mailed to Federal Communications Commission, at P.O. Box 979088, St. Louis, MO 63197-9000. Payment by overnight mail may be sent to U.S. Bank—Government Lockbox #979088, SL-MO-C2-GL, 1005 Convention Plaza, St. Louis, MO 63101. Payment by wire transfer may be made to ABA Number 021030004, receiving bank: TREAS NYC, BNF: FCC/ACV--27000001 and account number as expressed on the remittance instrument. If completing the FCC Form 159, enter the NAL/Account number in block number 23A (call sign/other ID), and enter the letters “FORF” in block number 24A (payment type code). 12. The response, if any, must be mailed to Office of the Secretary, Federal Communications Commission, 445 12th Street, S.W., Washington D.C. 20554, ATTN: Peter H. Doyle, Chief, Audio Division, Media Bureau, and MUST INCLUDE the NAL/Acct. No. referenced above. 13. The Commission will not consider reducing or canceling a forfeiture in response to a claim of inability to pay unless the respondent submits: (1) federal tax returns for the most recent three-year period; (2) financial statements prepared according to generally accepted accounting practices 24 47 U.S.C. §§ 309(k)(2), 309(k)(3). 25 For example, we do not find here that the Licensee's Station operation "was conducted in an exceedingly careless, inept and negligent manner and that the licensee is either incapable of correcting or unwilling to correct the operating deficiencies." See Heart of the Black Hills Stations, Decision, 32 FCC 2d 196, 198 (1971). Nor do we find on the record here that "the number, nature and extent" of the violations indicate that "the licensee cannot be relied upon to operate [the station] in the future in accordance with the requirements of its licenses and the Commission's Rules." Heart of the Black Hills Stations, 32 FCC 2d at 200. See also Center for Study and Application of Black Economic Development, Hearing Designation Order, 6 FCC Rcd 4622 (1991), Calvary Educational Broadcasting Network, Inc., Hearing Designation Order, 7 FCC Rcd 4037 (1992). Federal Communications Commission DA 09-2229 5 (“GAAP”); or (3) some other reliable and objective documentation that accurately reflects the respondent’s current financial status. Any claim of inability to pay must specifically identify the basis for the claim by reference to the financial documentation submitted. 14. Requests for full payment of the forfeiture proposed in this NAL under the installment plan should be sent to: Associate Managing Director-Financial Operations, 445 12th Street, S.W., Room 1- A625, Washington, D.C. 20554.26 15. IT IS FURTHER ORDERED, pursuant to Section 309(k) of the Communications Act of 1934, as amended, that the license renewal application of Universal Broadcasting, Inc. for commercial Station KQLO(AM), Sun Valley, Nevada (File No. BR-20081029ACD) IS GRANTED. 16. IT IS FURTHER ORDERED that a copy of this NAL shall be sent, by First Class and Certified Mail-Return Receipt Requested, to Universal Broadcasting, Inc., 417 West Plumb Lane, Reno, Nevada 89509 and to its representative, Brian M. Madden, Esq., Lerman Senter PLLC, 2000 K Street, NW, Suite 600, Washington, DC 20006. FEDERAL COMMUNICATIONS COMMISSION Peter H. Doyle Chief, Audio Division Media Bureau 26 See 47 C.F.R. § 1.1914.