In re Applications of STANLEY WARNER CORP. (TRANSFEROR), GLEN ALDEN CORP. (TRANSFEREE)

For Transfer of Control of Van Curler Broadcasting Corp.

FEDERAL COMMUNICATIONS COMMISSION

11 F.C.C.2d 246

December 22, 1967

ACTION:

APPLICATION

JUDGES:

The Commission, by Commissioners Hyde (chairman), Lee, and Wadsworth, with Commissioner Bartley concurring and issuing a statement, Commissioner Cox concurring and issuing a statement in which Commissioner Loevinger joins, and Commissioner Johnson dissenting and issuing a statement.

OPINION:

[*246] The Commission, by Commissioners Hyde (chairman), Lee, and Wadsworth, with Commissioner Bartley concurring and issuing a statement, Commissioner Cox concurring and issuing a statement in which Commissioner Loevinger joins, and Commissioner Johnson dissenting and issuing a statement, granted an application for transfer of control of Van Curler Broadcasting Corp., licensee of station WAST (TV), Albany, N.Y., from Stanley Warner Corp. to Glen Alden Corp. (BTC-5444).

CONCURBY: BARTLEY; COX

CONCUR:

STATEMENT OF COMMISSIONER ROBERT T. BARTLEY

As to which of the corporations -- Stanley Warner or Glen Alden -- is the licensee makes little difference. The intention to sell provides an opportunity that the station may be transferred to local ownership which would take an active part in the management. In view of this possibility, I am willing to grant consent to this transfer.

CONCURRING STATEMENT OF COMMISSIONER KENNETH A. COX IN WHICH COMMISSIONER LEE LOEVINGER JOINS

I concur in this action. However, I want to go on record as believing that parties in a situation such as this should either arrange for a pre-merger spin-off of any broadcast properties involved, or should present a concurrent proposal for sale to a third party as a part of the overall transaction. In the circumstances here, where it is not desirable to delay the merger pending disposition of the relatively small broadcast interests involved, I think it is most important that the transferee dispose of WAST-TV as quickly as possible to negative any suggestion that it might have profited from its transitory holding of the broadcast station.

DISSENTBY: JOHNSON

DISSENT:

DISSENTING OPINION OF COMMISSIONER NICHOLAS JOHNSON

Station Transfers

The FCC has today approved another station transfer in violation of its rules. The circumstances are so peculiar as to warrant a brief explanation.

[*247] Stanley Warner Corp. controls Van Curler Broadcasting Corp., licensee of WAST-TV Albany, N.Y. Stanley Warner is about to merge with Glen Alden Corp. Thus, control of WAST-TV must be transferred from Stanley Warner to the new, merged Glen Alden. The Commission must find this transfer serves the public interest. Section 310(b). These necessary findings are neither obvious nor stated by the Commission majority.

This particular transaction is further complicated, however, by the fact that Glen Alden states that it has no intention of operating WAST-TV. It intends to sell it as soon as practicable. This retransfer will violate our "3-year rule" -- which provides that, with exceptions not applicable here, stations must be held for 3 years before they can be transferred 47 CFR § 1.597 (1967).

Of course, the proposed future retransfer has no direct relevance to the transfer question before us today. Normally, one would expect that when the retransfer actually occurred, we would review it at the time, and, if it appeared incompatible with our rules, withhold approval. But something different is actually going on. Not only are we not scrutinizing the present sale to see if it benefits the public interest. We are assuring the parties involved of our eagerness to accommodate their private needs by promising that we will allow them a future transaction contrary to our rules.

In effect, we are casually serving notice of intent to ignore an important Commission proscription, simply because of a private party's self interest. The station could have been spun off prior to the merger -- a sale conditioned, if necessary, on the consummation of the merger. It was not. We could still have insisted on a similar condition. Now, because we have recently read in the Wall Street Journal that the merger has already been approved by the shareholders of both corporations, and do not wish to embarrass the participants by delaying the application of our imprimatur, we approve it in its present form.

Nor have we even sought to discover the roughest outlines of the transaction we have just approved in advance. There have been no representations as to the value of this station for purposes of transfer to Glen Alden, its market value, or its proposed sale price. We have not stated any intention to scrutinize closely the entity selected to be the new licensee -- quite the contrary.

I share the concerns of my three colleagues, Commissioners Bartley, Cox, and Loevinger. Indeed, my only disagreement is that the expressions of this Commission majority are not united in a dissent that might preserve the integrity of Commission process as well as the private interests involved in this case.