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                            Before the
                Federal Communications Commission
                      Washington, D.C. 20554

In the Matter of:                            )
                                        )
LORILEI COMMUNICATIONS, INC.            )
d/b/a THE FIRM                          )
                                        )
v.                                      )    CSR 5400-L
                                        )
HERITAGE CABLEVISION OF CALIFORNIA, INC.     )
d/b/a TCI OF CALIFORNIA                      )
                                        )
Leased Access Petition for Relief                 )
                                 

                  MEMORANDUM OPINION AND ORDER

     Adopted:  July 22, 1999            Released:  July 26, 1999

By the Deputy Chief, Cable Services Bureau:

I.   INTRODUCTION

     1.   Lorilei Communications, Inc. d/b/a The Firm ("The Firm"), has filed a petition for relief
alleging that Heritage Cablevision of California, Inc. d/b/a TCI of California ("TCI") has violated provisions
of Commission's commercial leased access rules.  TCI filed a response requesting that the petition be
dismissed.

II.  BACKGROUND

     2.   The 1984 Cable Act imposed commercial leased access requirements on cable operators
designed to assure access to cable systems by unaffiliated third parties who have a desire to distribute video
programming free of editorial control of cable operators.  Channel set aside requirements were established
proportionate to a system's total activated channel capacity.  The 1992 Cable Act revised the leased access
requirements and directed the Commission to implement rules to govern this system of channel leasing.  In
Report and Order and Further Notice of Proposed Rule Making ("Rate Order"), the Commission initially
adopted rules for leased access addressing maximum reasonable rates, reasonable terms and conditions of use,
minority and educational programming, and procedures for resolution of disputes.  The Commission modified
some of its leased access rules in Second Report and Order and Second Order on Reconsideration of the First
Report and Order ("Second Order").

III. ALLEGATIONS AND ARGUMENT 

     3.   The Firm is an advertising agency/video production company doing business throughout the
United States producing thirty minute programs to air on commercial leased access channels.  The Firm
accuses TCI of violating the Commission's leased access rules by responding too slowly to requests for leased
access information, imposing unreasonable insurance requirements, and overcharging for rental of additional
equipment used for airing leased access programming.  The Firm alleges that it made a request by facsimile
on March 26, 1999 for programming slots on TCI's San Jose, California cable system at 7:00 a.m. and 7:30
a.m. on Thursday, Friday and Saturday, April 15, 16 and 17, 1999 to coincide with a trade show in that market
on those dates.  The Firm contends it submitted a completed application for service and an insurance certificate
with its request. In the absence of any response from TCI, The Firm, after contacting TCI'  production and
programming manager by telephone, resubmitted its request on April 5, 1999.  The Firm received by facsimile
from TCI on April 7, 1999, a rate sheet, information on available time slots, and an indication that insurance
department approval of the insurance certificate would be needed.  The Firm contends further that on April
9, its business manager found another facsimile received at 6:30 p.m. on April 8 from TCI requesting
alterations to the insurance certificate.  The Firm responded by sending a revised insurance certificate, a
program tape and payment check to TCI later that day by facsimile and courier.  The Firm contends that on
the following Tuesday, April 13, in response to a telephone message received from TCI, a more compatible
tape format was sent to TCI and received by them on April 14.  Finally in this connection, The Firm states
that in the course of several calls, mostly in the form of recorded messages received between April 16 and 19,
1999, it was informed that TCI would not air the programming tapes at the times requested.

     4.   With respect to insurance coverage, The Firm contends that TCI unreasonably insists upon
an alteration of a standard insurance certificate clause and proof of worker's compensation insurance coverage. 
The Firm objects to TCI's request that the words "endeavor to" be deleted from a certificate clause concerning
the insurance carrier's obligations to provide notice of policy cancellation.  It also objects to providing proof
of workman's compensation coverage on the grounds that use of channel service does not involve the physical
presence of its employees on TCI premises.  Finally, The Firm contends that TCI's tape player rental rate of
$20 per hour is unreasonable, on the grounds that a tape player can be obtained from other sources at rates that
range from $60 to $150 per day.

     5.   The Firm contends that TCI, as a major MSO, is fully aware of its leased access obligations
as described in the Second Order released over two years ago.  The Firm claims that TCI none-the-less places
low priority on leased access and willfully refused to air its leased access programming within a reasonable
time.  The Firm seeks "maximum sanctions and fines against TCI for blatant violation" of its rights under
Section 612 of the Communications Act, refund of $238.62 paid for airtime not provided, and reimbursement
of $22,000 for lost revenues due to the programming not being aired when requested.

     6.   TCI contends that its responses to The Firm's requests for service were timely and within the
15 day response time required by Section 76.970(h) of the Commission's rules.  TCI states that The Firm's
request letters and applications of March 26 and April 5, 1999 were received at outdated facsimile numbers
and were not forwarded to the responsible commercial office until March 30 and April 6, 1999, respectively. 
In both cases, unsigned applications were received along with insurance certificates that contained an
unacceptable notice clause that failed to ensure notice of policy cancellation.  TCI states that, following a
telephone conversation with The Firm's president on April 7, 1999, the insurance certificate was forwarded to
its insurance department for review, and a rate schedule and description of available time slots were sent by
facsimile to The Firm.  TCI's manager also explained that he would be out of the office for a week or so after
April 8, and that things would need to proceed promptly if the requested program dates were to be met.  TCI
asserts that The Firm has provided acceptable insurance certificates in the past to TCI cable systems across
the country and is therefore fully aware of TCI's insurance certificate requirements, but submitted a defective
certificate in this case.  TCI states that although a listing of changes to the insurance certificate were sent to
The Firm on April 8, 1999, a modified insurance certificate containing the same objectionable words "endeavor
to" in the notice clause was returned.  Not having received a satisfactory insurance certificate, TCI's manager
then left instruction with the production technician not to cablecast The Firm's programming.  TCI contends
that it reasonably insisted on an insurance certificate that ensures notice of any policy cancellation.  TCI also
contends the requirement for proof of workman's compensation insurance is reasonable, although none of The
Firm's employees have a physical presence on TCI premises, because of concerns for injured employees seeking
to reach TCI's "deep pockets." 

     7.   TCI defends the reasonableness of the charge for tape playing equipment, contending that it
has "spent close to $35,000 to replace outdated leased access equipment at the San Jose system, including three
VCRs."  TCI further argues that it is inappropriate to utilize per day VCR rental rates in determining the
reasonableness of a VCR offered on an hourly basis.  Finally, TCI stats that The Firm's $238.62 check
tendered with the service application has been returned to The Firm uncashed.

IV.  DISCUSSION AND ANALYSIS

     8.   The Firm's petition is denied.  The record shows that The Firm bears major responsibility for
its programming not being aired on the requested dates.  The Firm failed to provide an insurance certificate that
satisfied TCI's notice of policy cancellation requirements.  In this connection, The Firm provided no basis for
a finding that TCI acted unreasonably in requiring a clause in the certificate that ensured notice of policy
cancellation.  Although the Commission indicated in the Second Report that the burden is on cable operators
to establish the reasonableness of insurance requirements, nothing suggests that the Commission assumed a
role in insurance contract negotiations or in risk analysis on behalf of cable operators, insurance companies,
or leased access programmers, as The Firm's petition implies in its arguments concerning the insurance
certificate clause and workman's compensation insurance coverage.

     9.   The record also shows that delay resulted from The Firm's transmitting the service application
to telephone numbers not associated directly with TCI's commercial office.  The different time zones in which
the parties are located, and the resulting unanswered messages, also contributed to delays.  The Firm provided
no evidence that TCI purposely addressed The Firm's service request matters after the close of normal business
hours in the eastern time zone.  The record shows, however, that TCI's manager forwarded The Firm's
insurance certificate to its insurance department for review, and sent a rate schedule and description of
available time slots by facsimile to The Firm on April 7, 1999, following receipt of The Firm's service requests
on March 30 and April 6.  TCI's manager also explained that he would be out of the office for a week or so
after April 8, and that things would need to proceed promptly if the requested program dates were to be met, 
We find that TCI responded to The Firm's leased access request well within the 15 day time limit set forth in
our rules.

     10.  The Commission has indicated that a cable operator may impose charges in addition to the
charges determined under Section 76.970 for the reasonable cost of other equipment and technical support
actually provided to a leased access programmer if that equipment and technical support is not also provided
with other non-leased access programming. The only issue raised here by The Firm is cost.  TCI's counsel
represents that TCI has invested approximately $35,000 in leased access equipment at the San Jose system,
including three VCRs.  Such information does not establish the cost of providing a VCR for leased access
programming.  Neither does The Firm's data relating to day rental rates for VCRs.  In Lorilei
Communications, Inc., d/b/a The Firm v. Scripps Howard Cable of Northwest Georgia, we found a $25 per
program administrative and technical support fee to be reasonably related to costs, after reviewing labor and
equipment cost information provided by the cable operator in that case.  Considering the nominal amount of
time required for tape playing, the record here provides no basis for reaching a different conclusion with respect
to TCI's $20 per hour VCR fee.

     11.  Finally, The Firm's request for reimbursement for loss of potential revenues and for repayment
of monies paid for requested services is also denied.  First, the record shows that TCI returned The Firm's
$238.62 check for requested services.  Secondly, The Firm failed to establish that TCI violated any of the
Commission's leased access rules. Moreover, the Commission's rules do not provide for recovery of monetary
damages.

V.   ORDERING CLAUSES

     12.  Accordingly, IT IS ORDERED that the petition for relief filed by Lorilei Communications,
Inc. d/b/a The Firm in File No. 5400-L IS DENIED.

     13.  This action is taken pursuant to authority delegated by Section 0.321 of the Commission's
rules.


                    FEDERAL COMMUNICATIONS COMMISSION


                    William H. Johnson, Deputy Chief
                    Cable Services Bureau