Broadcasting (July - Dec 1937)

FCC Gives Reasons lor Disqualifying Payne Allegation of Bias Is Accepted By Commission (Continued from page 11) allegations in the affidavit, the Chairman should be glad to have a general denial admitted of record unless that would be objected to by counsel; and, (9) The fact that counsel for respondents stated that, if Commissioner Payne desired said statement (mentioned in (7) supra) to be a general denial, counsel for respondents should have the privilege of cross-examination and the Chairman's statement that he would be obliged to recognize that right; and, (10) The fact that neither Commissioner Payne nor counsel for the respondents made any further statement at that time or in answer to the Chairman's question, addressed to Commissioner Payne and counsel, as to whether the record was to be closed upon this preliminary question before the Commission by the presentation of the motion by counsel for respondents to disqualify Commissioner George Henry Payne and the affidavit attached thereto and vdthout further offering of affidavit or evidence or plea of any kind by any of the parties concerned. Now THEREFORE IT APPEARING tO the Commission, upon consideration of said motion. Commissioner Walker dissenting, (Commissioner Payne not participating), that the Commission has jurisdiction to grant or deny the same; and, It also appearing, in the circumstances above recited, especially after Commissioner Payne's disclaimer of desire to deny, contradict, explain, answer or otherwise reply to said motion and affidavit, that said motion may properly be considered and finally determined solely on the question of law raised thereby, namely, whether, taking the facts alleged in said affidavit to be true for the purpose of the motion, said motion should be granted, without an inquiry into the objective truth or falsity of such allegations; and. Claims in Affidavit It further appearing that said affidavit contains allegations of fact, particularly the allegations contained therein : (a) In numbered paragraphs 1, 2, 3, and 4, which read as follows: "1. On or about October 15, 1936, the Magazine Broadcasting and Broadcast Advertising, owned by Broadcasting Publications, Inc., a client of the affiants, published an editorial condemning certain conduct of Commissioner Payne. "2. During the period intervening between Oct. 15, 1936, and Dec. 7, 1936, Commissioner Payne made frequent threats of an imminent suit for libel against the magazine. He caused an investigation to be made as to the stock ownership of Broadcasting Publications Inc., and during the course of such investigation ascertained that the affiant Segal was the owner of one share of stock in Broadcasting Publications Inc., and a member of its board of directors. Thereafter, Commissioner Payne made threats that he would 'get' the affiant Segal. "3. Thereafter and on Dec. 7, 1936, Commissioner Payne as plaintiff instituted a suit against Broadcasting Publications Inc., its editor and its publisher, claiming damages to the extent of $100,000 on account of the publication of the editorial above described. On Dec. 31, 1936, the affiant Segal in association with other counsel, filed pleas in which, among other things, it was set up that the matters of criticism published in the editorial referred to were true. "4. After the filing of this plea Commissioner Payne undertook to cause the bringing of disbarment proceedings against the affiants and to give the affiants every possible unfavorable publicity." " (b) Relating to statements made by Commissioner Payne to the public through the press on several occasions and to the public through the radio in the course of a speech concerning matters at issue in this proceeding; "(c) To the effect that Commissioner Payne sought to give the charges against the respondents wide publicity; "(d) Charging attempts on the Followinq is the full text of the press release Oct. 19 ty Commissioner Payne challenging the authority of his fellow commissioners in disqualifying him from sitting in the Segal-Smith trial. At the trial today of Paul M. Segal and George S. Smith before the FCC a motion to disqualify Commissioner George Henry Payne was made by the counsel for Segal and Smith. The first appeal was to Commissioner Payne to disqualify himself, which he refused to do. The counsel for the two lawyers then moved that the Commission disqualify Commissioner Payne, and this, the five members of the Commission voted to do. Commissioner Payne then notified the Commission that he would accept their decision but would make a statement in court as to his own views of the illegality of the action of the majority of members of the Commission. This the five members of the Commission declined to do on the grounds that it was improper and "did not belong in the record." Commissioner George Henry Payne's statement was as follows: "This statement is made to the press for the reason that the majority of the Commission declined part of Commissioner Payne, through "inaccurate statements" to press columnists "to bring the affiants into disrepute and to facilitate his plan to bring about, if possible, the disbarment of affiants" ; which facts, if true, show that Commissioner Payne has personal malice, bias and prejudice against the affiants by reason of which he is unable to act impartially in this proceeding. It appears therefore to the Commission that said motion and affidavit in support thereof are legally sufficient and should be taken as true for the purpose of this motion. Said motion to disqualify is, therefore, granted and It is hereby ordered that said Commissioner George Henry Payne be, and he is hereby, disqualified from the consideration of and prevented from participation in these proceedings in any manner. The Secretary of the Commission is hereby directed to file said motion and this order in the docket files of the Commission with the Rule to Show Cause issued to the respondents by order of September 16, 1937, the Rule to Show Cause issued by order of May 19, 1937, and the answers filed by respondents to said Rules to Show Cause. Federal Communications Commission By Frank R. McNinch Frank R. McNinch, Chairman Effective: Oct. 19, 1937. Filed: Oct. 25, 1937, 9:55 A. M. to permit me to make it at the hearing of Paul M. Segal and George S. Smith on the ground that it was improper. I have today been disqualified by a majority of the Commission from sitting at these disbarment hearings. "In the statement that I made this morning I emphasized the fact that neither in common law nor in constitutional or statutory provisions, and certainly not in the Communications Act of 1934, is there any ground for my disqualifying myself in a case such as this. "The action taken by five members of the FCC this afternoon, disqualifying me from sitting in this hearing, is, I believe, without warrant of law and may lead to grave consequences in the future. Under this ruling it may be possible for a lawyer to ask for the disqualification of any member of any Commission whose just judgment he has reason to fear. It leaves the way open for absolute control of the Commission in Washington by lawyers whose public interest is subordinate to the interest of their clients. "The respondents have cited only one case (Cooke v. U. S., U. S. Reports 267). In this case the Justice (Continued on page J^6) Lawyers' Affidavit Not Contested By Payne Following is the Segal-Smith affidavit accompanying their motion to disqualify Commissioner Payne. When Mr. Payne failed to deny the charges, his colleagues voted to disqualify him. Thereupon Mr. Payne issued a press release challenging the Commission's authority, full text of which starts on this page. Paul M. Segal and George S. Smith, being sworn, say: They are respondents mentioned in orders of the FCC dated May 19, 1937, and Sept. 16, 1937, bringing disbarment proceedings against them. Hearing on such orders is to take place Oct. 19, 1937. Hon. George Henry Payne is a member of the Commission and so far as affiants know he proposes to sit as a member of the Commission at the hearing, and to pass judgment upon the truth or falsity of the charges contained in the orders. Commissioner Payne is disqualified so to sit, because he has personal malice, bias and prejudice against the affiants by reason of which he is unable impartially to exercise his function as a member of the Commission in this matter. His bias is of such a character as seriously to impair his impartiality and to sway his judgment. His malice against the affiants has been shown by Commissioner Payne: In the conduct of a planned campaign of public adverse publicity against the affiants in the public and trade press and over radio broadcasting stations; in acting as investigator and prosecutor of affiants at his own instance and responsibility and without authority from his colleagues as a Commission, and in other ways which will be made apparent below. The malice of Commissioner Payne against the affiants is due to: the performance by affiants of their duty as counsel for the de-' fendants in George H. PayneX Plaintiff, v. Broadcasting Puhlica-\ tions. Inc., Martin Codel and Sol\ Taishoff, Defendants, being cause No. 88319 in the District Court of the United States for the District, of Columbia, being an action forsdamages on account of an alleged:;:: libel published by the defendants, concerning Commissioner Payne;-, the pleading filed by affiant Segal as of counsel for the defendants in that case setting up, among other defenses, the truth of the alleged libel ; the thorough investigation conducted by and under the: direction of the affiants — and concerning which knowledge has come to Commissioner Payne — into the qualifications, character, personal history and characteristics of Commissioner Payne. The information available to the affiants and which they believe, proving the malice and bias of (Turn to page 26) Commissioner Payne^s Press Release On His Disqualification From Hearing Page 24 • November i, 1937 BROADCASTING • Broadcast Advertising