Broadcasting Telecasting (Apr-Jun 1958)

GOVERNMENT continued eluded Winfield Scott. New Jersey publishersongwriter; songwriter Terry Gilkyson; Moe Gale, New York publisher and former personal representative of several top stars; Lewis R. Chudd. president of Imperial Records; Charles C. Cowley, president of Muzak Corp.; Martin Meleher. ASCAP-BMI publisher, personal manager of top stars and husband of singer Doris Day; Don Owens. WARL Arlington. Va., country music disc jockey ("any enterprise that allows a farm boy from Alabama to compete with Irving Berlin is a very healthy system"), and singer Betty Johnson. Martin T. Obie. vice president-general manager of KWAD Wadena. Minn., entered a new subject into the hearings when he loosed a bitter attack on SESAC. a third licensing firm. "SESAC offers broadcasters practically nothing yet they have been able to obtain agreements from 98% of die radio stations in operation today." he charged. A majority of these agreements were secured through "unfair tactics," he said. Only 200 of KWAD's 30.000 records are SESAC. yet the station is required to pay that organization $20 monthly, he told the subcommittee. Mr. Obie testified he wrote SESAC challenging its right to collect licensing fees and the firm used an "implied threat" in its reply. He also listed several stations who, he said, have experienced the same relations with SESAC. Washington attorney Marcus Cohn testified on behalf of two clients seeking amendment of the bill to place their activities outside its scope. Clients are the National Assn. of Educational Broadcasters and jointly-owned Coastal Recording Co. (which rents its facilities to advertising agencies) and WHOM-AM-FM New York. Mr. Cohn said the bill would have "unintended adverse effects" on individual college members of NAEB and on Coastal. Kluge-Evans Ownership Team Expanded to New York Outlets The station-owning combination of multiple-owner John W. Kluge and WTOP-AMTV Washington personality Mark Evans is continuing with Mr. Kluge's sale of a 10% partnership interest in his New York State am-fm properties, WINE Kenmore and WILY (FM) Buffalo to Mr. Evans for $15,000. Sale of KOME Tulsa, Okla., by Messrs. Kluge and Evans to another multiple-owning group, Charles W. Holt and associates, for $250,000 is pending FCC approval [Changing Hands, April 2H\. Messrs. Kluge and Evans bought KOME last year for $100,000 [For the Record, July 22, 1957]. Mr. Evans is also associated with Mr. Kluge in the ownership of WEEP Pittsburgh. Mr. Kluge controls WGAY Silver Spring (Md.). KNOK Fort Worth and WKDA Nashville ami with his wife holds a minority interest in WLOF-TV Orlando. Fla. FCC View on NBC-WBC Swap Reiterated to U. S. Supreme Court A restatement of the FCC's position taken during litigation over the NBC-Westinghouse swap of radio-tv stations in Cleveland-Philadelphia— that the FCC's action in approving the transfer does not preclude action by the Justice Dept. on antitrust implications of the transaction — was submitted by the FCC last week to the U. S. Supreme Court as a supplement to Justice's appeal of the case. The Justice Dept. several weeks ago [Government, March 3] asked the Supreme Court to reinstate the government's antitrust suit against NBC-RCA as a result of the 1955 swap of NBC's WTAM-AM-FM and WNBK (TV) Cleveland plus $3 million for Westinghouse's KYW and WPTZ (TV) Philadelphia. Federal Judge William H. Kirkpatrick of the Philadelphia District Court had refused to try the Justice Dept. suit, brought in December 1956, on grounds the FCC has primary jurisdiction over a transfer and after it has approved the transaction the Dept. of Justice cannot attack it [Government, Jan. 20; At Deadline, Jan. 13]. The FCC's "supplemental memorandum" last week, submitted to the Supreme Court through the Solicitor General, reiterated the FCC position that it made no error in approving the transaction, concluding that "while the Commission may deny applications as not in the public interest where violations of the Sherman Act have been determined to exist, its approval of transactions which might involve Sherman Act violations is not a determination that the Sherman Act has not been violated, and therefore cannot forestall the U. S. from subsequently bringing an antitrust suit challenging those transactions." ASCAP FILE SENT TO JUSTICE DEPT. • House group makes report • Antitrust study recommended A House subcommittee last week took a slap at the royalty payments, grievance procedures and voting systems of ASCAP in recommending that the Justice Dept. study antitrust proceedings against the music licensing firm. The recommendation came in a report released by the Distribution Subcommittee of the Select Committee on Small Business. It followed several days of hearings in March and April [Government, March 17] on charges by several ASCAP members that they were not getting adequate royalty payments and on other society practices. Chairman James Roosevelt (D-Calif.) said the subcommittee is turning all its records over to Justice and has recommended that such action be taken as is necessary to effectuate the "terms and spirit" of the 1950 ASCAP consent decree. This consent decree settled a federal antitrust suit of several years' standing alleging monopolistic practices. The report specifically questioned ASCAP's voting system for its directors, its system of checking on music performances, formulas used in allocating royalties and grievance procedures for dissatisfied members. "Remedies for more important problems disclosed by the hearings may be available through appropriate action by the Dept. of Justice," the subcommittee stated. ASCAP elects its board of directors (12 writer members and 12 publisher members) by allocating a writer member one vote for each $20 of revenue and a publisher member one vote for each $500 of revenue. The report questioned whether this procedure fulfills requirements of the consent decree. The report also questioned ASCAP's compliance with the decree in its rating of members for performance payments. "There is no consistent corelation between the actual average of performance credits and the point class in which a member is rated," the report found. ASCAP's grievance procedures are constructed in such a way as to mitigate against a complaining member, the report indicated, and make a reward, when finally received, of relatively little value. The ASCAP board of appeals, in a majority of the cases, does not give a basis for its decisions and interpretations made of the distribution rules are not reduced to writing and are not made generally available, the report found in questioning this practice. Rep. Roosevelt said the hearings disclosed facts "that raise serious questions of vital concern to this committee" and therefore Justice was asked to step in. Members of the subcommittee held an executive meeting with four attorneys from Justice [Closed Circuit, April 7], which already has a sweeping investigation of ASCAP underway, soon after the public hearings closed. Other members include Rep. Tom Steed (D-Okla.), Rep. Charles H. Brown (D-Mo.), Rep. Timothy P. Sheehan (R-Ill.) and Rep. Arch A. Moore Jr. (R-W. Va.). BARROW HEARI FCC hearing sessions on the Barrow Report — previously scheduled for today (Monday) and tomorrow — have been postponed until next week, with the sessions extended to four days: Monday, Tuesday, Thursday and Friday (May 19-20, 22-23). Parties still to be heard and their order of appearance are: stations represented by CBS Spot Sales (Glenn Marshall Jr. of WMBR-TV Jacksonville and Jay W. Wright of KSL-TV Salt Lake City); NBC Spot Sales (Nathan Lord of WAVETV Louisville); Station Representatives 3 RESCHEDULED Assn. (John Blair, Blair Tv and Blair Tv Assoc.; Lewis H. Avery, Avery-Knodel; Eugene Katz, Katz Agency; Frank Headley, H-R Tv; Lloyd Griffin, Peters, Griffin, Woodward); Edward Petry of Edward Petry & Co.; John English, Committee for Competitive Tv, and representatives from the following individual tv stations: KFDM-TV Beaumont. Tex.; KVAR (TV) Mesa, Ariz.; WCSH-TV Portland, Me.; WDSU-TV New Orleans (Robert D. Swezey); WFLA-TV Tampa, Fla., and WLAC-TV Nashville, Tenn. Page 56 • May 12, 1958 Broadcasting