Pontchartrain Broadcasting Co., Inc. v. Federal Communications Commission

15 F.3d 183, 304 U.S. App. D.C. 364, 74 Rad. Reg. 2d (P & F) 759, 1994 U.S. App. LEXIS 2359
CourtCourt of Appeals for the D.C. Circuit
DecidedFebruary 11, 1994
Docket93-1291
StatusPublished
Cited by21 cases

This text of 15 F.3d 183 (Pontchartrain Broadcasting Co., Inc. v. Federal Communications Commission) is published on Counsel Stack Legal Research, covering Court of Appeals for the D.C. Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Pontchartrain Broadcasting Co., Inc. v. Federal Communications Commission, 15 F.3d 183, 304 U.S. App. D.C. 364, 74 Rad. Reg. 2d (P & F) 759, 1994 U.S. App. LEXIS 2359 (D.C. Cir. 1994).

Opinion

Opinion for the Court filed by Circuit Judge GINSBURG.

GINSBURG, Circuit Judge:

Pontchartrain Broadcasting Company was one of several applicants for a permit to construct a television station in Hammond, Louisiana. PBC was the only remaining applicant, however, by the time the FCC determined that it had falsely certified in its application that it was financially qualified. The FCC nonetheless denied PBC’s request belatedly to amend its application so as to meet the financial qualifications, and hence denied its application. PBC appeals on the ground that where there is no competing applicant FCC precedent requires the agency to allow the amendment. We affirm the agency’s decision, as detailed below.

*184 I. Background

After holding a hearing to compare the relative merits of PBC and a competing applicant, an Administrative Law Judge issued an Initial Decision awarding the construction permit to PBC. See 3 FCC Red. 6800 (1988). The Review Board remanded the case, however, for the ALJ to consider further whether PBC was in fact financially qualified and whether it had made a false certification in that regard; the ALJ then added as an issue the possible existence of an undisclosed real-party-in-interest.

Before the ALJ issued a decision in the proceeding on remand, the other party competing for the permit settled with PBC and withdrew his application. PBC then filed a petition to amend the financial portion of its application.

In a Supplemental Initial Decision, the ALJ resolved all three hearing issues against PBC and denied its petition to amend on the ground that “it [came] too late in the proceeding and would violate the long held principle that ‘in the absence of a demonstration by the applicant that had reasonable assurance of financing at the time of certification, subsequent petitions to amend financial proposals [should be] disallowed.’ ” 6 FCC Red. 5025, 5032 (1991) (quoting Aspen FM, Inc., 6 FCC Red. 1602, 1603 (1991)). The Review Board affirmed the ALJ’s decision on the financial qualification and false certification grounds without reaching the real-party-in-interest question. 7 FCC Red. 1898 (1992).

Upon further review by the Commission, PBC conceded that it did not have adequate assurance of financing at the time that it filed its application, but contended that it had acted in good faith. Supporting PBC’s application, the Mass Media Bureau argued, moreover, that under the Commission’s decision in Las Americas Communications, Inc., 5 FCC Red. 1634 (1990), the FCC was required to accept PBC’s financial amendment because it was the only remaining applicant when it attempted to amend its application.

The Commission rejected the Bureau’s argument, holding that “Aspen is controlling here, not Las Americas, notwithstanding the absence of competing applicants.” 8 FCC Red. at 2257. Amending the application, the Commission observed, would not conclude the proceedings; the false certification and real-party-in-interest issues would remain to be resolved before the Commission could determine that granting the license to PBC would be in the public interest. Because a grant to PBC would still depend upon a favorable resolution of each of the other qualification issues, moreover, it was not even clear that allowing the amendment “would facilitate the institution of new broadcast service.” Hence the Commission determined that amending the application likely “would entail more immediate administrative burden than rejection.”

The Commission also affirmed the ALJ’s determination that PBC had not properly certified its financial condition in its original application. Therefore, the Commission affirmed the Review Board’s decisions both to reject PBC’s amendment and to deny its unamended application.

II. Analysis

Under the Commission’s rules, once an application has been designated for hearing it may be amended “only upon a showing of good cause for late filing.” 47 C.F.R. § 73.3522(b). In general, to make the good cause showing, the applicant must show that it acted with due diligence, that the amendment was not necessitated by a voluntary act of its own, and that the amendment will not otherwise disrupt the application process or prejudice any other party to it. See Las Americas Communications, Inc., 5 FCC Rcd. at 1637; Erwin O’Conner Broadcasting Co., 22 FCC2d 140, 143 (Rev.Bd.1970); see also Royce International Broadcasting Co. v. Federal Communications Commission, 820 F.2d 1332, 1335-38 (D.C.Cir.1987) (discussing the basic requirements of a good cause showing). In cases involving amendment of an applicant’s initial financial certification, the Commission generally requires that the applicant also demonstrate that it had a reasonable assurance of financing at the time that it made its initial certification. See Aspen FM, 6 FCC Rcd. at 1603-04.

In Las Americas the Commission explained that the good cause test is “not rigid *185 ly applied” but rather is interpreted in light of its “primary purpose ... to prevent undue disruption of the Commission’s processes.” 5 FCC Red. at 1687. In that case, for example, the Commission allowed an amendment changing the applicant’s proposed community of license pursuant to a settlement among the competing applicants, although such a change was “clearly not involuntary.” “Where a post-designation amendment permits the immediate grant of a pending application ... by curing a disqualifying defect in the only pending application, the Commission generally concludes that the equities favor granting the amendment.” Id.

PBC argues that the Commission’s decision to disallow its amendment in this ease represents an unexplained departure from the standard set out in Las Americas, and that it must therefore be overturned as arbitrary and capricious. The FCC rejected the contention that Las Americas is controlling here, as we have seen, because “[acceptance of PBC’s financial amendment ... would not moot all of the outstanding issues that would have to be resolved before [it] could find that granting PBC’s application would serve the public interest.” 8 FCC Red. at 2257.

PBC is of course correct that an unexplained departure from Commission precedent would have to be overturned as arbitrary and capricious. See Crosthwait v. FCC, 584 F.2d 550, 556 (D.C.Cir.1978); see also United Food & Commercial Workers Local 150-A v. NLRB, 880 F.2d 1422, 1434-39 (D.C.Cir.1989). In this case, however, the Commission’s order is not inconsistent with its prior practice.

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Bluebook (online)
15 F.3d 183, 304 U.S. App. D.C. 364, 74 Rad. Reg. 2d (P & F) 759, 1994 U.S. App. LEXIS 2359, Counsel Stack Legal Research, https://law.counselstack.com/opinion/pontchartrain-broadcasting-co-inc-v-federal-communications-commission-cadc-1994.