Federal Communications Commission
Washington, D.C. 20554
DA 10-495
Released: March 26, 2010
SagamoreHill of Corpus Christi Licenses, LLC
c/o Todd Stansbury, Esq.
Wiley Rein, LLP
1776 K Street, N.W.
Washington, DC 20006
Eagle Creek Broadcasting of Corpus Christi, LLC
c/o Dennis Corbett, Esq.
Lerman Senter PLLC
2000 K Street, N.W., Suite 600
Washington, DC 20006
Channel 3 of Corpus Christi, Inc.
c/o Robert B. Jacobi, Esq.
Cohn and Marks LLP
1920 N Street, N.W., Suite 300
Washington, DC 20036-1622
Re: Application for Assignment of License
KZTV(TV), Corpus Christi, Texas
Fac. ID No. 33079
File No. BALCT-20080730AKQ
 
Gentlemen:
This is in regard to the above-referenced application to assign the license of station 
KZTV(TV), Corpus Christi, Texas, from Eagle Creek Broadcasting of Corpus Christi, LLC 
(“Eagle Creek”) to SagamoreHill of Corpus Christi Licenses, LLC (“SagamoreHill”).  A Petition 
to Deny was filed by Channel 3 of Corpus Christi, Inc. (“Channel 3”), licensee of station 
KIII(TV), Corpus Christi, Texas.  On August 24, 2009, the parties amended the applications, and 
submitted executed versions of certain cooperative agreements between Eagle Creek and a 
subsidiary of the Evening Post Publishing Company (“Evening Post”), which controls the 
licensee of station KRIS-TV, Corpus Christi, Texas.1 Station KRIS-TV and station KZTV(TV) 
  
1 On September 11, 2009, Eagle Creek filed an FCC Form 316 application creating ECB Licenses, Inc. (“ECB”) as a 
new wholly owned subsidiary.  See File No. BALCDT-20090908ADM.  The above-captioned application has been 
2
are located in the same Corpus Christi Nielsen Designated Market Area (“DMA”), which 
contains five independently owned and operating commercial and non-commercial television 
stations.  On October 7, 2009, Channel 3 filed a supplement to its Petition to Deny challenging 
the executed cooperative agreements and the amendment to the above-captioned application.  
Channel 3 also filed a Complaint requesting imposition of unspecified sanctions and issuance of 
an order unwinding the executed agreements between Eagle Creek and Evening Post.  
SagamoreHill and Evening Post have filed a responsive opposition to the October 7, 2009, 
supplement, to which Channel 3 has filed reply.  For the reasons set forth below, we deny the 
petition and Complaint, and grant the application.2
Background. As initially proposed, Eagle Creek would enter into an asset purchase 
agreement with SagamoreHill, pursuant to which SagamoreHill would acquire the station’s 
licenses, network affiliation agreement, syndicated programming contracts, certain studio 
equipment, transmission equipment and certain other unspecified property, and a lease for tower 
and transmitter space, for $5 million.  Concurrent with the SagamoreHill asset purchase 
agreement, Eagle Creek entered into an asset purchase agreement with Evening Post, pursuant to 
which Evening Post would acquire station KZTV(TV)’s real property, production and other 
equipment, and other assets of the station, for $14,780,00.00.  In the August 24, 2009, 
amendment, the SagamoreHill asset purchase agreement was revised, and the purchase price for 
the programming assets was reduced to $1.75 million.  Certain changes were also made to the 
Evening Post asset purchase agreement, and Eagle Creek notified the Commission that the 
Evening Post asset purchase agreement had been consummated.
Attached to the original applications were unexecuted versions of the following 
agreements between Evening Post and SagamoreHill:  Shared Services Agreement (“SSA”); 
Agreement for Sale of Commercial Time (“JSA”); Option Agreement (“Option”), and 
Transmitter Equipment, Studio and Office Lease Agreement (“Lease Agreement”).  The parties 
also stated that they anticipated Evening Post would guarantee a loan to SagamoreHill.  Pursuant 
to the August amendment, Eagle Creek was substituted for SagamoreHill and provisions were 
added that permitted the assignment of the agreements to SagamoreHill upon grant of the above-
captioned application and consummation of the transaction.  The amended SSA, JSA, and Lease 
agreements were consummated and are currently in force.  In a subsequent pleading, Eagle Creek 
provided a hard copy of an agreement whereby Evening Post would guarantee a bank loan from 
the Bank of South Carolina.  
Pursuant to the SSA, Evening Post provides, in addition to back-office support, newscasts 
not to exceed 15% of station KZTV(TV)’s weekly programming.3 In exchange for the services 
provided under the SSA, Eagle Creek pays a Monthly Services Fee of $100,000, plus certain 
     
amended to reflect ECB as the proposed assignor.  In addition, the amended agreements name KVOA 
Communications, Inc. (“KVOA”), the licensee of station KRIS-TV and a subsidiary of Evening Post, as a party. For 
ease of reference, we will refer to Eagle Creek and Evening Post as being the sole parties to the various agreements 
discussed herein.
2 In addition to the supplement and the Complaint, Channel 3 filed an Informal Objection opposing the above-
referenced FCC Form 316 application, in which it raised similar issues as the petition, supplement, and complaint.  
Eagle Creek filed an Opposition to the Informal Objection.  
3 Shared Services Agreement, Section 4(f).
3
adjustments to account for services provided outside the ordinary course of business or 
equipment procured on behalf of Eagle Creek.4 Under the JSA, Evening Post sells all of the 
available commercial time for station KZTV(TV), as well as sets advertising rates, subject to the 
ultimate control of Eagle Creek.5 In exchange for its sales representation, Evening Post will 
retain the lesser of the revenues it collects minus a set Base Rate, or 30% of all revenues.6  
Pursuant to the Lease Agreement, as amended, Eagle Creek will lease studio and office space 
from Evening Post for $16,666.67 per month, and Eagle Creek will retain a right of access to 
Evening Post’s transmission equipment.  Each of the agreements has a ten-year term, terminable 
by each party after the initial ten-year period.  
In its original Petition to Deny, Channel 3 argued that the transaction and associated 
agreements would result in Evening Post either holding de facto control over, or an attributable 
interest in, station KZTV(TV).  In support of these allegations, Channel 3 largely relied on 
differing language contained in the original SagamoreHill and Evening Post asset purchase 
agreements, stating that “[a] careful review of the two Asset Purchase Agreements establishes 
that [Evening Post] controls the finances, the real and personal property, the day-to-day 
operation, indeed, all aspects of KZTV operation,”7 in violation of both Section 310(d) of the 
Communications Act of 1934 (the “Act”) and the local television ownership rule.8 Channel 3 
further maintained that, when considered together, the SSA, JSA, Option and Lease Agreement 
would result in Evening Post holding a level of control over the programming of station 
KZTV(TV) to justify attribution for purposes of determining compliance with the local television 
ownership rule.  Channel 3 also maintained that the transaction would adversely affect 
competition in the Corpus Christi DMA since it would result in Evening Post controlling more 
than 50% of the television advertising revenue in the market.  Finally, Channel 3 argued that 
certain schedules and exhibits, which included a list of programming agreements and specified 
equipment to be purchased by SagamoreHill, were improperly omitted from the asset purchase 
agreements attached to the application. 
SagamoreHill and Evening Post responded in their consolidated opposition that the 
agreements between and among SagamoreHill, Evening Post, and Eagle Creek are fully 
consistent with other arrangements approved in the past.  They maintained that none of the 
agreements “in any way diminishes SagamoreHill’s operational control over [station 
KZTV(TV)].”9 They argued that the different language contained in the Eagle 
Creek/SagamoreHill and Eagle Creek/Evening Post asset purchase agreements is irrelevant in 
determining how control over station KZTV(TV) would be exercised after the transaction.  With 
respect to the competitive effect of the acquisition, SagamoreHill and Evening Post argued that 
Channel 3 had provided no reason why the Commission should ignore its ownership rules and 
  
4 Id. at Section 4(g).  
5 Agreement for Sale of Commercial Time, Section 2.
6 Id. at Section 3.
7 Petition to Deny, at 10.
8 47 U.S.C. § 310(d); 47 C.F.R. §73.3555(b)(2002).
9 Opposition to Petition to Deny, at 2-3.
4
apply a “vague economic ‘analysis’” to this transaction.10 In any case, they argued that Channel 
3’s claim regarding competition in the market ignores competition from cable systems, radio 
stations, newspapers and other outlets, as well as ignores the 40% revenue share currently held 
by Channel 3’s own station, KIII(TV), in the market.11
In reply, Channel 3 reiterated that the differences in language between the two asset 
purchase agreements indicated “that programming (other than CBS network programming), 
financial information, matters relating to adverse changes, the sufficiency of Seller’s assets 
necessary to operate the station and trade agreements…are exclusively within the control of 
Evening Post.”12 Channel 3 also stated that the JSA differs from those previously approved in 
that Evening Post will sell all of the commercial advertising, as well as set advertising rates.  
Channel 3 further stated that the SagamoreHill’s portion of the purchase price will be guaranteed 
by Evening Post.
Channel 3’s supplement reiterates many of the same arguments made above.  Channel 3 
further states that execution of the amended cooperative agreements absent FCC approval is 
further evidence that the Evening Post has already acquired control over station KZTV(TV).  
Channel 3 also cites the deletion of the termination dates on both asset purchase agreements, and 
the redaction of the sales price from the amended Evening Post asset purchase agreement, as 
further evidence that Eagle Creek has abdicated control.  The Complaint reiterates these 
arguments, and requests enforcement action, including preliminary relief.  
In response, SagamoreHill states that pending approval of the assignment applications, 
Eagle Creek has “retained the FCC licenses, equipment, and programming contracts necessary to 
operate the station,” has its own employees, and has both “the contractual right and economic 
incentive to control KZTV(TV)’s programming.”13 SagamoreHill maintains that the agreements 
do not result in either attribution or a transfer of de facto control and, thus, the parties were 
within their rights to enter into such agreements without Commission approval.
Discussion.  The Commission applies a two-step analysis to a petition to deny under the 
public interest standard.  The Commission must first determine whether the petition contains 
specific allegations of fact sufficient to show that granting the application would be prima facie
inconsistent with the public interest.14 This first step “is much like that performed by a trial judge 
considering a motion for directed verdict:  if all the supporting facts alleged in the [petition] were 
true, could a reasonable factfinder conclude that the ultimate fact in dispute had been 
established.”15 If a petition meets this first step, the Commission must determine whether, “on 
the basis of the application, the pleadings filed, or other matters which [the Commission] may 
  
10 Id. at 4-5.
11 Id. at 5.
12 Reply, at 4 (emphasis in original).
13 Opposition to Unauthorized Supplement to Petition to Deny, at 2-3.
14 47 U.S.C. §309(d)(1); Astroline Communications Co. Ltd. Partnership v. FCC, 857 F.2d 1556 (D.C. Cir. 1988) 
(“Astroline”).
15 Gencom, Inc. v. FCC, 832 F.2d 171, 181 (D.C. Cir. 1987) (“Gencom”).  See also  Serafyn v. FCC, 149 F.3d 1213, 
1216 (D.C. Cir. 1998) (affirming two-step public interest analysis) (“Serafyn”).
5
officially notice,” the petitioner has raised a substantial and material question of fact as to 
whether granting the application would serve the public interest.16 We conclude that Channel 3 
has failed to raise a substantial and material question of fact as to whether Evening Post holds 
either de facto control over, or an attributable interest in, station KZTV(TV).
In its Complaint, Channel 3 has not requested specific sanctions for the alleged 
unauthorized transfer of control and violation of the Commission’s ownership rules, other than 
an order mandating an “unwinding” of the executed agreements.  To the extent the Complaint 
requests that the Commission “unwind” the agreements, we will treat the Complaint as a request 
for Commission action pursuant to Section 1.41 of the Commission's rules.17  
The Commission analyzes de facto control issues on a case-by-case basis.18 In 
determining de facto control, the Commission examines the policies governing station 
programming, personnel, and finances.19 The agreements make clear that Eagle Creek has 
ultimate control over all programming decisions and policies, which will be retained by 
SangamoreHill once the transaction is consummated and the various agreements are assigned.  
With respect to personnel, station KZTV(TV) retains its own management.  The SSA states 
specifically that Eagle Creek will maintain separate personnel for the selection and procurement 
of programming to be aired on station KZTV(TV), and that there will be no sharing of services, 
personnel, or information regarding programming with the exception of the newsfeeds to be 
provided by Evening Post.  The newscasts provided by Evening Post are subject to the specific 
direction and control of Eagle Creek.       
We do not find that the structure of the sale indicates that Evening Post will acquire de 
facto control.  The Commission has approved sales where certain physical assets would be sold 
to a buyer other than the proposed assignee.20 The asset purchase agreements govern the details 
of the sale, and operation of the station until consummation of the proposed transaction.  The 
asset purchase agreements, moreover, are between the seller and the purchaser of the various 
assets.21 As noted by SagamoreHill and Evening Post, their relationship will be governed 
primarily by the post-consummation SSA and JSA, and to a lesser extent the Option and Lease 
Agreement.  We, therefore, find that removing the termination date from the asset purchase 
agreements and redacting the sales price from the amended Eagle Creek/Evening Post agreement 
  
16 Astroline, 857 F.2d at 1561; 47 U.S.C. §309(e).  See also Gencom, Inc., 832 F.2d at 181.
17 47 C.F.R. §1.41.    
18 See Shareholders of Hispanic Broadcasting Corporation, 18 FCC Rcd 18834, 18843 (2003); Chase Broadcasting, 
Inc., 5 FCC Rcd 1642, 1643 (1990).
19 See WHDH, Inc., 17 F.C.C.2d 856, 863 (1969), aff'd sub nom., Greater Boston Television Corp. v. FCC, 444 F.2d 
841 (D.C. Cir. 1970).
20 See Piedmont Television of Springfield License LLC, Memorandum Opinion and Order, 22 FCC Rcd 13910 (Vid. 
Div. 2007).
21 We find that the submission of the schedules is not necessary in order to consider Channel 3’s allegations as an 
adequate description of the assets was contained in the respective SagamoreHill and Evening Post agreements.  
Application of LUJ, Inc. and Long Nine,Inc., Memorandum Opinion and Order, 17 FCC RCD 16980 (2002) 
(omission of certain exhibits to asset purchase agreement appropriate where not germane to consideration of 
assignment and/or transfer of control application).
6
does not indicate abdication of control on the part of Eagle Creek.
With respect to the cooperative agreements themselves, the Commission’s attribution 
rules seek to identify those interests that confer a degree “of influence or control such that the 
holders have a realistic potential to affect the programming decisions of licensees or other core 
operating functions.”22 The interests triggering attribution are defined in Section 73.3555 Note 2 
of the Commission’s rules and in Commission precedent.23 We find that the arrangement 
between Eagle Creek and Evening Post is consistent with those approved in the past.24 The 
newscasts provided pursuant to the SSA are limited to 15% of weekly programming, and thus do 
not exceed the attribution benchmark for LMAs established in the 1999 Attribution Order.  The 
SSA and JSA are both explicit with respect to employee control, stating that Eagle Creek and 
SangamoreHill as the eventual assignee will maintain independent management for station 
KZTV(TV) and, with the exception of newscast production, will maintain separate management 
for the procurement of programming. The payment to SagamoreHill for services provided under 
both the SSA and JSA is similar to those approved in the past.25 The payment scheme provides 
Eagle Creek with both the economic incentive and ability to control programming aired over 
station KZTV(TV).   While Evening Post will be able to set advertising rates, Eagle Creek 
retains the right to reject commercial advertisements offered by Evening Post.  We further find 
that neither Evening Post’s guarantee of debt nor the Option results in attribution.26 In 
concluding that loan guarantees are not attributable, and that options are not attributable until 
exercised, the Commission indicated that such relationships do not provide the interest holder 
with the means or incentive to exert influence over the core operations of a licensee.27  
  
22 1999 Attribution Order, 14 FCC Rcd at 12559.
23 47 C.F.R. §73.3555 Note 2.
24 See Nexstar Broadcasting, Inc., Memorandum Opinion and Order, 23 FCC Rcd 3528 (Vid. Div. 2008); Chelsey 
Broadcasting Company of Youngstown, LLC, Memorandum Opinion and Order, 22 FCC Rcd 13905 (Vid. Div. 
2007); and Malara Broadcast Group of Duluth Licensee LLC, 19 FCC Rcd 24070 (Vid. Div. 2004).
25See Malara Broadcast Group of Duluth Licensee LLC, 19 FCC Rcd at 24071-24073 (Broker collects all revenues 
under JSA, 30% of which it will retain as payment of its ad rep services, and broker receives $150,000 monthly as 
shared services fee).
26 On March 5, 2009, the staff requested that the parties amend the application to include the monetary consideration 
indicated in Section 2 of the Option submitted with the original application; provide a hard copy of the guarantee, if 
the guarantee has been reduced to writing; and list the consideration for the guarantee, monetary or otherwise. On 
March 19, 2009, SagamoreHill filed an amendment in which it stated that the consideration for the Option, while not 
finalized, will be between $40,000 and $60,000.  As noted above, a guarantee for a bank loan to Eagle Creek was 
submitted in a subsequent pleading.  SagamoreHill has stated that there was no consideration for the guarantee and 
that, at the time of the March 5, 2009, letter, the guarantee had not been reduced to writing.  The finalized Option, 
which was submitted as part of the August 24, 2009, amendment, lists a consideration of $10.  The consideration 
paid for the Option when considered along with the other interests held by Evening Post in SagamoreHill, does not 
exceed the 33% of total assets necessary for attribution under the EDP standard.  Review of the Commission’s 
Regulations Governing Attribution of Cable/MDS Interests, Report and Order, 14 FCC Rcd 12559, 12579 (1999) 
(“1999 Attribution Order”), recon. granted in part, Memorandum Opinion and Order on Reconsideration, 16 FCC 
Rcd 1097, 1111 (2001)(“Attribution Reconsideration”)(“in connection with a transfer or assignment 
application…the applicant must use the sales price of that transfer or assignment as the total asset value.”).
27 Attribution Reconsideration, 16 FCC Rcd at 1112.  
7
The Commission, in a Notice of Proposed Rulemaking, has tentatively determined that 
certain television JSAs should be attributable,28 but an order in the proceeding has yet to be 
issued.  We decline to reach a decision here that would anticipate the outcome of the pending 
rulemaking.  Moreover, even were the Commission to conclude in the future that JSAs similar to 
the one at issue here would be attributable, the Commission would have to determine what, if 
any, grandfathering relief for existing television JSAs would be appropriate.   We, therefore, 
decline to condition our decision here on the outcome of the pending rulemaking.  
The Commission's multiple ownership rules are intended to promote competition, 
diversity and localism in the mass media, essential goals “in carrying out [the Commission's] 
statutory mandate of ensuring that broadcast licensees serve the ‘public interest, convenience, 
and necessity.”29 Even were we to apply a case-by-case approach in this instance, Channel 3 has 
failed to proffer sufficient economic data to permit meaningful economic analysis or substantiate 
its claim of competitive harm.  Because, based on the record before us, we find that the 
agreements between Evening Post and Eagle Creek will not result in either an unauthorized 
transfer of control or an acquisition of an attributable interest, the parties were under no 
obligation to acquire Commission consent prior to executing the agreements.  Thus, we will deny 
the request to “unwind” the executed agreements.  
Regardless, execution of the agreements, absent a finding regarding the attribution and de 
facto control allegations, does not preclude the Commission from reviewing the agreements for 
consistency with Commission rules and/or precedent and issuing an appropriate enforcement 
remedy were we to find a rule violation.  With respect to the generalized request for interim 
relief, a moving party must make a strong showing that:  1) irreparable harm would result before 
a decision on the merits can be rendered; 2) the petitioner is likely to prevail on the merits; 3) 
injunctive relief will not substantially harm other interested parties; and 4) injunctive relief is in 
the public interest.30 Channel 3 has argued that “the calculated decision to bypass the FCC in the 
context of a contested proceeding warrants at the outset urgent preliminary relief,” without 
showing how that relief would be necessary to prevent irreparable harm.31 We find this showing 
to be inadequate.
For the reasons set forth above, IT IS ORDERED, That the September 16, 2009, 
Informal Objection filed by Channel 3 of Corpus Christi, Inc., IS DENIED, and the pro forma 
application to assign the license station KZTV(TV), Corpus Christi, Texas, from Eagle 
Broadcasting of Corpus Christi, LLC, to ECB Licenses, Inc. (File No. BALCDT-
  
28 In the Matter of Rules and Policies Concerning Attribution of Joint Sales Agreements in Local Television 
Markets, Notice of Proposed Rulemaking, 19 FCC Rcd 15238, 15239, 15244 (2004).
29 In the Matter of Review of the Commission's Regulations Governing Television Broadcasting, Report and Order, 
14 FCC Rcd 12903, 12907 (1999) (subsequent history omitted).  In the Matter of 2002 Biennial Regulatory 
Review—Review of the Commission’s Broadcast Ownership Rules and Other Rules Adopted Pursuant to Section 
202 of the Telecommunications Act of 1996, Report and Order, 18 FCC Rcd 13620 (2003) (“ 2002 Biennial Review
Order”) (subsequent history omitted).
30 Washington Metropolitan Area Transit Authority, Inc. v. Holiday Tours, Inc., 555 F.2d 841 (D.D. Cir. 1977).  
31 Channel 3 Complaint, at 10.
8
20090908ADM), IS GRANTED. We further find that the parties to the above-caption long-form 
application are fully qualified and that grant of the application would comply with all 
Commission rules as well as serve the public interest, convenience and necessity.  Accordingly, 
IT IS FURTHER ORDERED, That the Petition to Deny and Complaint filed by Channel 3 of 
Corpus Christi, Inc., ARE DENIED, and the application to assign station KZTV(TV), Corpus 
Christi, Texas, from ECB Licenses, Inc., to SagamoreHill of Corpus Christi Licenses, LLC (File 
No. BALCT-20080730AKQ) IS GRANTED.  
Sincerely,
William T. Lake 
Chief, Media Bureau