Before the Federal Communications Commission Washington, D.C. 20554 In the Matter of: ) ) Complaint of Costa de Oro Television,) CSR-5382-M Inc. against Time Warner Cable ) ) Request for Carriage ) MEMORANDUM OPINION AND ORDER Adopted: July 28, 1999 Released: July 29, 1999 By the Chief, Consumer Protection and Competition Division, Cable Services Bureau: I. INTRODUCTION 1. Costa de Oro Television, Inc., permittee of Television Broadcast Station KJLA (Ch. 57), Ventura, California ("KJLA"), filed a must carry complaint against Time Warner Cable ("Time Warner") for its failure to carry KJLA on its cable system serving the communities of El Segundo, Hawthorne, Lawndale, Gardena and Torrance, California (the "South Bay" system). An opposition to this complaint was filed on behalf of Time Warner and KJLA has replied. II. BACKGROUND 2. Pursuant to Section 614 of the Communications Act and implementing rules adopted by the Commission in its Implementation of the Cable Television Consumer Protection and Competition Act of 1992 ("Must Carry Order"), commercial television broadcast stations are entitled to assert mandatory carriage rights on cable systems located within the station's market. A station's market for this purpose is its "area of dominant influence," or ADI, as defined by Arbitron research organization. III. THE PLEADINGS 3. In support of its petition, KJLA argues that in its decision in Costa de Oro Television, Inc., the Cable Services Bureau modified's KJLA's must carry zone to include those communities within the Los Angeles ADI which are located within KJLA's Grade A contour. At the same KJLA states that the Bureau ordered KJLA to notify "relevant cable systems" of its carriage and channel position elections within 30 days of the release of the Order and for those same systems to begin carriage of KJLA 60 days thereafter. KJLA points out that Time Warner, which was a party in this proceeding, did not seek reconsideration of that order and as its cable communities are located within KJLA's Grade A contour, the station is entitled to carriage on Time Warner's South Bay cable system. 4. KJLA states that, by letter dated March 18, 1998, it provided the notice required by the Costa de Oro order. In response, it indicates that Time Warner raised the issue of signal quality and, ultimately, on August 17, 1998, formally denied carriage based on KJLA's failure to provide a usable signal. KJLA admits that at that time it was operating at significantly reduced power due to the destruction of its antenna, transmission line and transmitter as the result of a lightning strike and a subsequent fire. In September 1998, KJLA states that it committed to provide a fiber feed to Time Warner's principal headend. KJLA indicates that in several subsequent exchanges with Time Warner, the system first disputed the delivery of the fiber feed, than apparently agreed to it. However, KJLA states that when installation was due, Time Warner refused to cooperate. When questioned, KJLA states that Time Warner, for the first time, indicated that KJLA was not entitled to must carry on the South Bay system as the cable communities served were not mentioned among those in which KJLA was granted must carry rights in Costa de Oro. 5. KJLA maintains that Time Warner's actions in this case cannot be countenanced by the Bureau. KJLA asserts that in all of the correspondence between it and Time Warner since its initial March 18th letter, there was never a question raised as to KJLA's fundamental carriage rights on the system, but merely the issue of signal quality and the logistics of getting KJLA's signal to the system headend. However, KJLA argues that now that it is apparent that it is willing and able to provide a fiber feed to the headend, Time Warner has apparently decided to change its tactics. KJLA asserts that such tactics are abhorrent, particularly as Time Warner caused KJLA to expend tremendous effort over nearly a year to coordinate and order a fiber feed. Whatever its motivations for such conduct, KJLA argues that the Bureau should immediately order Time Warner to commence carriage of its signal. 6. In opposition, Time Warner states that KJLA's must carry complaint is grounded on the claim that it has must carry rights on the South Bay cable system. However, Time Warner argues that KJLA does not have such carriage rights and its complaint should be dismissed. It points out that in Costa de Oro KJLA requested the inclusion of 60 Los Angeles and Orange County communities among which were the South Bay system communities. Time Warner states that the Bureau's decision in Costa de Oro granted the petition with respect to certain named communities and denied the petition "in all other respects." Time Warner states that none of the South Bay cable system communities were listed among those communities the Order granted. Time Warner argues that since the conclusion was inescapable that Costa de Oro denied KJLA must carry rights on the South Bay cable system, there was no need for Time Warner to file a reconsideration in the matter. 7. Time Warner points out that, pursuant to Section 614(h)(1)(C) of the 1992 Cable Act and its implementing rules, the Commission accepts and processes market modification petitions on a community-specific basis. It states that in every instance where the Bureau has granted a television station's modification petition with respect to certain communities, but denied others, the Bureau's order has specifically identified by name each of the communities added to the petitioner's market. In this instance, Time Warner states that KJLA attempts to bootstrap its carriage by reliance on the Bureau's generalized statements relating to KJLA's carriage rights on cable systems within its Grade A contour. Based on this discussion, according to KJLA, it is entitled to carriage in all cable communities located within its Grade A contour regardless of whether that community was identified in the petition or granted by the Bureau. Time Warner contends, however, that such argument flies in the face KJLA's own actions and the clear language of the modification provisions. Time Warner points out, for instance, that KJLA's initial modification petition requested the inclusion of specified cable systems and communities and not the inclusion of all communities within its Grade A contour. Moreover, Time Warner states that although KJLA's pending reconsideration of the Costa de Oro decision is specific to certain communities located between its Grade A and Grade B contours which were denied in the Order, Torrance, the only South Bay cable system community located in that area is not among them. 8. Finally, Time Warner argues that KJLA's reliance on its post-order actions and the responses of Time Warner in an attempt to establish its must carry rights on the South Bay cable system are unavailing because the Bureau's unequivocal denial in Costa de Oro with respect to the South Bay cable communities makes it clear that KJLA has no legal basis for asserting its must carry rights on that system. Time Warner concedes that when faced with KJLA's aggressive pressure for carriage it was perhaps slow in realizing that there was no legal foundation for KJLA's request. Nevertheless, it maintains that when it did become aware of KJLA's unfounded carriage demands, it notified KJLA immediately. 9. In reply, KJLA argues that Time Warner attempts to slip through the cracks of must carry enforcement in this proceeding. After dodging its carriage obligations for over a year, KJLA states that Time Warner now seizes on a quirk of language in the Bureau's Order to avoid having to carry its signal in communities that virtually brush up against KJLA's City Grade contour. KJLA states that in its modification petition it did its best to identify all of the cable systems within reach of the station, but it did so at a time when "regional clustering" was beginning and cable systems were becoming increasingly difficult to identify. Now, KJLA states that Time Warner seeks to elude its carriage obligations by claiming that KJLA did not properly identify it and its other communities in its petition and the Bureau, by failing to take into account an exhibit in Time Warner's opposition, somehow made the explicit finding that KJLA was not entitled to carriage on the South Bay system. However, KJLA points out that not only are the communities of El Segundo, Hawthorne, Lawndale and Gardena not mentioned anywhere in the Order, and Torrance only in footnote 1, but nowhere in that decision does the Bureau make a finding that these communities should not carry KJLA or, alternatively, why they as Grade A communities, should be singled out from carriage. Therefore, KJLA argues that it acted reasonably in making its carriage notification to Time Warner. 10. Further, while Time Warner makes much of the fact that Section 614(h) refers to community-by-community changes, KJLA states that it ignores the fact that the Commission has consistently modified must carry zones to create markets that are not patchwork quilts of "some in, some out," but rather must carry zones that match up with the four statutory factors in an orderly fashion, often by county. KJLA maintains that Time Warner wants to carve out its coverage area based on its technical reading of Costa de Oro. In any event, KJLA argues that the fact that Torrance, the one community listed in the Order, is not within KJLA's Grade A contour does not relieve Time Warner of its carriage obligations because Commission precedent makes it clear that where a cable system is partially within and partially outside a station's must carry zone, it must carry that station on its system. Moreover, KJLA asserts that Time Warner is no longer even willing to argue that KJLA's programming is not geared to its subscribers. Since it cannot reasonably deny the importance of KJLA's programming to its subscribers, KJLA argues that Time Warner must instead rely on the Bureau's failure to explicitly name the South Bay system in its Costa de Oro decision. IV. DISCUSSION 11. We are not convinced by the arguments raised by KJLA and will deny its complaint. It has been previously held that KJLA is not entitled to carriage on cable systems in the Los Angeles ADI because the 1991-1992 Television Market Guide, the current controlling text in market designations, assigned the station to the Santa Barbara-Santa Maria-San Luis Obispo ADI and not to the Los Angeles ADI. The fact that Arbitron recognized that KJLA's city of license is not physically located in Ventura County, which is located in the Los Angeles ADI, does not affect the assignment of KJLA to the Santa Barbara ADI. KJLA is therefore not a "local station" to the communities in question under the Commission definition of the term since it is not within the same television market with respect to the cable systems in question. 12. KJLA does not dispute this finding, but claims in this instance that it is entitled to carriage on Time Warner's South Bay system due to the Bureau's decision in Costa de Oro which partially granted KJLA's modification request to include certain specified communities within the Los Angeles ADI within its market for must carry purposes. While it is not our intention to reargue the merits of that decision, particularly as there is a pending petition for reconsideration of that order, we find KJLA's reliance on this decision misplaced. In its Must Carry Order, the Commission states that "Section 614(h)(1)(C) of the 1992 Act permits the Commission to add communities to or subtract communities from a station's television market to better reflect marketplace conditions following a written request." Each request for modification of a station's market was intended to be specific to that particular request and the inclusion or exclusion of anything other than specifically-named individual communities (i.e., whole counties, or complete areas within a station's Grade A or Grade B contour) was not contemplated. KJLA points to the Bureau's statement in Costa de Oro at paragraph 31, which stated that ". . . we believe that it may appropriately be defined for purposes of this decision as including only those communities within the predicted Grade A contour of the station." KJLA is wrong in its contention, however, that this language bestowed a unilateral grant of must carry rights to KJLA in all communities located within its Grade A contour. The specific communities for which this grant applied were listed in the ordering clause of the decision. While KJLA attempts to justify its failure to include the subject communities in its original request for modification, the simple fact is that KJLA did not include these communities nor did it supplement its original request with an more accurate list of communities for which it sought relief. 13. In addition, we find KJLA's alternate contention that because the South Bay system is both partially within and partially outside of its must carry zone (i.e., Grade A contour), it is entitled to carriage is also misplaced. The portion of the Must Carry Order cited by KJLA states that in situations where ". . . the system straddles two ADIs, all broadcast stations in both ADIs will be considered "local" for must-carry purposes." That is not the situation here. 14. In view of the foregoing, we find that a grant of KJLA's complaint is not in the public interest. V. ORDERING CLAUSES 15. Accordingly, IT IS ORDERED that the petition filed March 26, 1999, by Costa de Oro Television, Inc. IS DENIED pursuant to Section 614(d)(3) of the Communications Act of 1934, as amended. 16. This action is taken pursuant to authority delegated by Section 0.321 of the Commission's rules. FEDERAL COMMUNICATIONS COMMISSION Deborah Klein, Chief Consumer Protection and Competition Division Cable Services Bureau