NAB reports (Jan-Dec 1946)

simply directs the Commission to grant or renew a license if it shall find that public interest, convenience, or neces¬ sity will be served thereby.4 It would be difficult, if not impossible, to formulate a precise and comprehensive defi¬ nition of the term “public interest, convenience, or neces¬ sity,” and it has been said often and properly by the courts that the facts of each case must be examined and must govern its determination.5 It seems clear, however, that a decision of the Commission refusing to renew a license should not be allowed to stand if it appears that the Com¬ mission’s prior and necessarily basic determination that public interest, convenience, or necessity will not be served by the renewal, was not properly reached; that is, that proper standards were not applied in reaching the con¬ clusion that a renewal would not serve the public interest, convenience, or necessity, and thus that the conclusion reached was arbitrary or the result of caprice. It is obvious that, in dealing with an application for the renewal of a license, the quality of the applicant’s programs and the adequacy of the applicant’s mechanical and scientific broadcasting facilities are principal among the elements to be considered. Concerning these particu¬ lars, although the Commission made no finding with re¬ spect to them, substantial and undisputed evidence in the record shows that Station WOKO consistently has ren¬ dered reasonably satisfactory service to its listeners and that it has not been guilty of delinquency in service which would support the conclusion that it should be denied a renewal of its license for that reason. Probably the prin¬ cipal concern which the general public has in Station WOKO is with the quality of the music and messages which it emits. It should be remembered that the appellant sought the enlargement of the issues specified by the Commission to include the fundamental issue of the quality of its program service and the practical and technical excellence of its facilities and their operation. The Commission declined to make the suggested enlargement because it said that the issues originally announced by it were sufficiently broad to permit the introduction of evidence concerning those as¬ pects of the case. It is perhaps not without significance that at the hearing the Commission’s counsel objected to the introduction of evidence by the appellant intended to show that it had served its area well and that it is me¬ chanically and scientifically equipped to do so. Although the trial examiner received the evidence, the Commission made no finding with respect thereto. On this appeal, it is the duty of the court to examine the evidence to see if it furnishes a substantial basis for the Commission’s find¬ ings of fact, and to see if there is anything material in the evidence which should have been found by the Com¬ mission, but which is omitted from its findings. The latter is important because, if the administrative agent fails to find formally some relevant element of the factual situa¬ tion, there is disclosed the beginning of an arbitrary or capricious conclusion. The record reveals, not only that the Commission made no finding with respect to the quality of the appellant’s service in the past and its equipment for good service in the future, but also that it failed to mention in its findings anything of the value of the property which its decision would render almost valueless. It failed to notice the innocence of Curtis and The Press Company concerning Smith’s concealment of Pickard’s stock ownership. These things we regard as being material. There is evidence in the record that in 1943 an offer of $75,000 was made for twenty-five per cent of the appellant’s capital stock. This indicates the value of the stock owned by Curtis and The 4 u. S. C., Title 47, § 307(a) : “The Commission, if public convenience, interest, or necessity will be served thereby, subject to the limitations of this chapter, shall grant to any applicant therefor a station license pro¬ vided for by this chapter.” U. S. C., Title 47, § 309(a) : “If upon examination of any application for a station license or for the removal or modification of a station license, the Commission shall determine that public interest, convenience, or necessity would be served by the granting thereof, it shall authorize the issuance, renewal, or modification thereof in accordance with said finding. In the event the Commission upon examination of any such application does not reach such decision with respect thereto, it shall notify the applicant thereof, shall fix and give notice of a time and place for hearing thereon, and shall afford such applicant an oppor¬ tunity to be heard under such rules and regulations as it may pre¬ scribe.” 5 Section 402(c) of Communications Act; Federal Communications Comm’n v, Pottsville Broadcasting Co., 309 U. S. 134. Press Company which will be largely lost to them should the Commission’s decision stand. When a broadcasting station has been constructed, nec¬ essarily at considerable cost, and has been maintained and operated to the satisfaction of its listeners, it is ordinarily in the public interest that the station continue to operate, and a renewal of its license should not be refused unless there exist as a basis for the refusal what this court has called “compelling reasons.” Those reasons must be such as bear on the interest of the public, or such as have effect upon its necessity or its convenience; nothing less can be “compelling,” and on no other ground does the statute authorize the Commission to deny the renewal.5 Under the authority of the Communications Act (Sec¬ tion 312, Title 47, U. S. C.)6 7 a station license may be re¬ voked by the Commission for false statements, either in the application or in the statements of fact which may be required under Section 308, or because the statements of fact revealed conditions which would have justified the refusal of a license in the first instance. It may be said, therefore, that the Commission may refuse to renew a license for any similar reason. It seems to us, however, that it is impossible to dissociate the provisions of Section 312 from those of Sections 307 and 309.8 The latter two sections contain the broad standard that the public inter¬ est, convenience, and necessity must be served; and the Commission is directed to grant a license or a renewal, once it appears that the public will be served in those particulars. So, a station iicense may not be revoked, under the authority of Section 312, for a false statement in the application, unless in exercising a sound discretion the Commission should decide that, because of such false statement, the public interest, convenience, or necessity would be served by a revocation of the license. In reach¬ ing such a decision, the Commission must weigh, as it apparently heretofore has done consistently, the compet¬ ing considerations which enter into the determination of the question whether the public interest, convenience, or necessity would be served by a revocation. Any other con¬ struction of Section 312 would arm the Commission with arbitrary power to revoke a license for the most inconse¬ quential misstatement by the licensee. For all the foregoing reasons we conclude that the Com¬ mission does not have the power, implied from the pro¬ visions of Section 312 or otherwise, to refuse to issue a renewal license because of misstatements of the licensee, unless those misstatements are of such moment as to out¬ weigh all competing considerations, and logically and ra¬ tionally to give rise to the conclusion that the public interest, convenience, and necessity would not be served were the license renewed. In other words, the guiding star of the Commission concerning the issue of a station license or a renewal thereof is fixed by the statute as the service of the interest, convenience, or necessity of the public. Every specific grant of authority to the adminis 6 Journal v. Federal Radio Comm’n, 60 App. D. C. 92; Chicago Fede¬ ration of La\bor v. Federal Radio Comm’n , 59 App. D. C. 333. 7 U. S. C., Title 47, § 312(a) : “Any station license may be revoked for false statements either in the application or in the statement of fact which may be required by section 308 of this title, or because of condi¬ tions revealed by such statements of fact as may be required from time to time which would warrant the Commission in refusing to grant a license on an original application, or for failure to operate substantially as set forth in the license, or for violation of or failure to observe any of the restrictions and conditions of this chapter or of any regulation of the Commission authorized by this chapter or by a treaty ratified by the United States : Provided, however. That no such order of revocation shall take effect until fifteen days’ notice in writing thereof, stating the cause for the proposed revocation, has been given to the licensee. Such licensee may make written application to the Commission at any time within said fifteen days for a hearing upon such order, and upon the filing of such written application said order of revocation shall stand suspended until the conclusion of the hearing conducted under such rules as the Commission may prescribe. Upon the conclusion of said hearing the Commission mav affirm, modify, or revoke said order of revocation.” 8 U. S. C., Title 47, § 307(a) : “The Commission, if public convenience, interest, or necessity will be served thereby, subject to the limitations of this chapter, shall grant to any applicant therefor a station license pro¬ vided for by this chapter.” U. S. C., Title 47, § 309(a) : “If upon examination of any applica¬ tion for a station license or for the renewal or modification of a station license, the Commission shall determine that public interest, convenience, or necessity would be served by the granting thereof, it shall authorize the issuance, renewal, or modification thereof in accordance with said find¬ ing. In the event the Commission upon examination of any such appli¬ cation does not reach such decision with respect thereto, it shall notify the applicant thereof, shall fix and give notice of a time and place for hearing thereon, and shall afford such applicant an opportunity to be heard under such rules and regulations as it may prescribe.” (Continued on next page) JANUARY 28, 1946-60