444 F.2d 841 (D.C. Cir. 1970)
The struggle to determine the licensee for Channel 5 in Boston began in 1954 when four mutually exclusive applications were filed, including that of WHDH, Inc., a wholly owned subsidiary of the publisher of the Boston Herald-Traveler newspaper.1 Three years later, the FCC granted the application to WHDH, which began broadcasting in 1957.2 While the decision was on appeal, it emerged that WHDH's Robert Choate had arranged two luncheons with FCC Chairman George C. McConnaughey during the pendency of the proceedings, one in 1954-55 to size up the chairman and another in 1956 to discuss legislative matters including the Harris-Beamer bills.3
Following a remand for an evidentiary hearing on the ex parte contacts, the FCC in 1960 set aside the permit to WHDH as voidable, granted it a special temporary authorization to continue broadcasting, and reopened the comparative proceeding among the original applicants.4 In 1962, the FCC again awarded a construction permit to WHDH but limited its operating license to four months.5 After Choate's death in 1963, the FCC in October 1963 designated for comparative hearing WHDH's renewal application together with mutually exclusive applications filed by Boston Broadcasters, Inc., Charles River Civic Television, Inc., and Greater Boston Television Corp. (II).6
The consolidated comparative proceeding began in May 1964.7 In August 1966, the Hearing Examiner issued an initial decision favoring WHDH's renewal, emphasizing its past operating record.8 On January 22, 1969, the FCC reversed the Examiner and granted the application of BBI while denying the others. The Commission adhered to this result on reconsideration in May 1969, though it granted WHDH's petition for rehearing in part.9 Greater Boston Television Corp. and the other unsuccessful applicants appealed the decision to the United States Court of Appeals for the District of Columbia Circuit.10
Whether the FCC's procedures, findings, and reasons in the comparative licensing proceeding satisfied the basic requirements of the rule of law in administrative decision-making?11
In reviewing agency action the court enforces reasonable procedure with fair notice.12 It examines whether evidentiary findings rest on substantial evidence and support rational inferences of ultimate fact.13 It requires the agency to articulate with reasonable clarity its reasons for decision while taking a hard look at salient problems rather than ignoring them or swerving from precedents without discussion.14
Yes. The court reviewed the full sequence of events beginning with the 1954 applications and the 1957 grant to WHDH.15 The remand after disclosure of Choate's luncheons with Chairman McConnaughey followed.16 The 1960 voiding of the permit as voidable together with the temporary authorization occurred.
The 1962 four-month license was granted.17 The 1963 designation of comparative hearing after Choate's death took place. The 1964 consolidated proceeding began.18 The 1966 Examiner decision favored WHDH on past performance.19
The 1969 Commission reversal granted the license to BBI on diversification and integration grounds.20 These steps demonstrate that the FCC supplied reasoned analysis identifying the significance of the ex parte contacts.21 The Commission applied the 1965 Policy Statement criteria after expressly classifying the case as sui generis on reconsideration.22 It made findings on each comparative factor that were supported by the record and explained departures from the Examiner with sufficient clarity to permit judicial review.23
The FCC's procedures, findings, and reasons satisfied the basic requirements of the rule of law.24
Whether WHDH was entitled to the same consideration as a conventional renewal licensee rather than being subjected to comparative criteria applicable to new applicants?25
A licensee whose operating authority has been limited to temporary authorizations because of prior ex parte misconduct may be treated as a new applicant.26 This occurs when the renewal application has been designated for comparative hearing with new applicants after court remand.27 The Commission determines that the unique procedural history places the licensee in a substantially different posture from the conventional renewal applicant under the 1965 Policy Statement.28
No. Although WHDH received a four-month operating license in 1962, it operated the station for nearly twelve years under temporary authorizations.29 The established facts show that this license was granted only after the Commission had voided the original permit due to Choate's improper contacts.30 The 1963 order expressly invited new applications within a two-month period.31 The 1969 reconsideration order expressly found the case unique because WHDH had never held a full three-year renewal free of challenge.32 The Commission therefore properly applied the 1965 comparative criteria rather than the Hearst renewal policy.33
The court upheld that determination as within the range of sound administrative discretion.34
WHDH was not entitled to the same consideration as a conventional renewal licensee.35
Whether the FCC properly assigned preferences among the applicants on the criteria of diversification of media ownership, integration of ownership and management, and proposed program service?36
The Commission may award substantial preferences on diversification when an applicant is affiliated with a local newspaper.37 It may award preferences on integration when multiple owners propose full-time management participation with relevant experience.38 It may assign offsetting slight demerits on program proposals when both new applicants present average schedules.39 The ultimate selection rests on a composite consideration of all substantial differences among the applicants.40
Yes. The established facts show that the Commission awarded a substantial preference to BBI and Charles River over WHDH on diversification because of the Herald-Traveler's ownership and the premature publication incident.41 It gave BBI a significant preference over Charles River on integration because six BBI stockholders proposed full-time management duties with television experience while only one Charles River owner participated with radio experience.42 It assigned offsetting slight demerits on program service that left the applicants even on that criterion.43
The Commission then selected BBI on the composite of these findings.44 The court found the selection supported by substantial evidence and within agency discretion.45
The FCC properly assigned preferences among the applicants on the stated criteria.46
Whether the FCC's vote granting the license to BBI was valid in light of abstentions and the number of participating commissioners?47
Yes. The established facts show that three commissioners did not participate in the decision.51 Commissioner Robert Lee voted for WHDH and abstained from choosing between BBI and Charles River.52 Commissioner Johnson voted for BBI specifically to constitute a working majority.53 Four commissioners therefore participated, and three voted for BBI.54 This satisfied the quorum and majority requirements.55 The court held that Johnson's vote to break the impasse was a permissible exercise of discretion.56
The FCC's vote granting the license to BBI was valid.57
Whether the FCC's reversal of the Hearing Examiner's decision favoring WHDH was supported after full consideration of the record?58
Yes. The established facts show that the Commission accepted many of the Examiner's findings on past performance, program proposals, and the effect of Choate's death, but it departed on the weight to be given a merely favorable rather than exceptional record and on the application of new-applicant criteria.6162 The Commission made clear both its awareness of the Examiner's conclusions and its reasons for a different result.63 The court concluded that substantial evidence supported the Commission's ultimate selection of BBI.64
The FCC's reversal of the Hearing Examiner's decision was supported after full consideration of the record.65