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If you need the complete document, download the WordPerfect version or Adobe Acrobat version, if available. ***************************************************************** Before the Federal Communications Commission Washington, D.C. 20554 In re Complaint of ) ) Zell Miller and Guy Millner ) ) Against Station WALB-TV ) Albany, Georgia ) ORDER Adopted: July 24, 1997 Released: July 25, 1997 By the Chief, Mass Media Bureau: 1. The Mass Media Bureau ("Bureau") has before it a Complaint filed June 20, 1995, on behalf of Zell Miller and Guy Millner (collectively, "Complainants") against Station WALB-TV, Albany, Georgia. The Bureau also has before it an Answer filed by WALB-TV, Inc. 2. Complainants allege that Station WALB-TV overcharged them during the 1994 primary, runoff, and general elections in violation of the lowest unit charge ("LUC") requirements of Section 315(b)(1) of the Communications Act of 1934, as amended (the "Communications Act"). Specifically, Complainants contend that WALB-TV: (1) overcharged candidates during the relevant LUC periods; and (2) failed to disclose certain requisite information about its sales practices to candidates. Complainants also allege that WALB-TV violated the political file requirements of Sections 73.1943 and 73.3526(f) of the Commission's Rules. 47 C.F.R.  73.1943 and 73.3526(f). Complainants seek discovery of WALB-TV's advertising records covering the 1994 LUC periods. 3. Lowest Unit Charge Requirements, 6 FCC Rcd 7511 (1991) ("Declaratory Ruling"), recon. denied, 7 FCC Rcd 4123 (1992) ("Reconsideration Order") sets forth specific procedural requirements governing  315(b) complaints. To invoke the Commission's enforcement procedures, complainants who allege a violation of  315(b) are required to make a prima facie showing of such violation. At a minimum, this showing must consist of a "short, plain statement of the claim sufficient to show that the complainant is entitled to the relief requested." Declaratory Ruling, 6 FCC Rcd at 7513,  22. A complainant must describe the specific factual basis for its belief that a station has committed a violation, rather than, for example, merely making a general allegation that a station has overcharged candidates. Lawton Chiles, Bob Martinez, Bill Nelson, and Jim Smith, 7 FCC Rcd 6661, n. 8 (MMB 1992), modified, 7 FCC Rcd 7199 (MMB 1992), review granted in part and denied in part, 8 FCC Rcd 131, 132 (1992)("WTVT"). The licensee may submit an answer to the complaint within ten days. 4. If, upon review of the complaint and answer (if filed), the Bureau determines that the complainant has established a prima facie case, the Bureau will issue an order giving the parties the opportunity to select one of two dispute procedures for resolving the complaint: mediation or disposition by the Bureau, subject to review by the Commission. Declaratory Ruling, 6 FCC Rcd at 7513,  22. Under either procedure, the complainant is entitled to limited discovery, subject to specific conditions set forth in the Bureau's order. Declaratory Ruling, 6 FCC Rcd at 7513,  23. 5. Applying the guidelines set forth in the Declaratory Ruling, we find that Complainants have established a prima facie case of a violation by Station WALB-TV of the LUC requirements of Section 315(b)(1) of the Communications Act with respect to the sixty day period preceding the 1994 general election. However, we find that Complainants have failed to establish a prima facie case of a LUC violation by WALB-TV during the forty-five day periods preceding the 1994 primary and runoff elections. We also find that Complainants have established a prima facie case of a LUC violation with respect to disclosure to Complainants of its make good policy and audience delivery sales practices in effect during the 1994 general election period. Finally, we find that it would be improper to consider allegations of political file violations in this Order. Following is a detailed discussion of the Bureau's specific findings with respect to the issues raised, and the timetable and procedures for discovery, post-discovery, and election of a procedure for resolving this complaint. I. LOWEST UNIT CHARGE ALLEGATIONS A. Comparison With Generally-Available Statistical Data 6. Complainants rely on generally-available statistical data to establish a prima facie case of overcharge by Station WALB-TV. Specifically, Complainants allege that Station WALB-TV charged rates for political advertising which exceeded "SMART"-based rates. SMART, the acronym for Spot Market Analysis of Rates for Television, a product of Media Market Guide, is a compilation of generally-available statistical data on average rates charged by television stations in particular markets. In support of their allegations, Complainants state that by "[m]ultiplying the average rate for a given daypart in the Albany market by the actual, station-specific rating on WALB, it is evident that Complainants were overcharged by significant amounts." To arrive at SMART-based rates for the third and fourth quarters, Complainants multiplied the SMART rates contained in the Media Market Guide published in the second and third quarters of 1994 by Nielsen's July 1994 and November 1994 ratings. Complainants' calculations were based on three different demographics, households, persons 18+, and Adults 25-54. Complainants then compared the station-specific SMART-based rates with the rates actually charged to each Complainant. Based on their calculations, Complainants assert that Miller was overcharged between $20,099 and $30,887, depending upon which demographic is used, and Millner was overcharged between $11,583 and $17,398. 7. WALB argues that market average numbers are not reliable in Albany, Georgia, and should not be utilized to establish a prima facie case. Specifically, WALB argues that market average numbers do not "adequately portray actual market conditions in atypical markets like Albany, Georgia, where there are only two television stations and one of them very substantially predominates over the other." WALB next argues that Complainants' analysis is deficient because it considers only "a relatively small part of the total time bought." WALB speculates, without providing any support, that a full analysis might establish that rates actually charged were below SMART-calculated rates in a significant number of time periods. Finally, WALB points out that Complainants' SMART calculations are limited to time purchased during the 1994 general election LUC period. Accordingly, WALB asserts, no prima facie case has been made for the 1994 primary and runoff elections. 8. The Commission has specifically endorsed the use of generally available industry or statistical data on average rates to make a prima facie case of an LUC violation. While we recognize that the use of such data may be more probative in some markets and less in others, absent the use of such data, a prima facie case of an LUC violation would be difficult to make. See WTVT(TV), 7 FCC Rcd at 6663, n. 11. Thus, we allow the use of such data in all market types and reject WALB's contentions that SMART data should not be used to establish a prima facie case of overcharges in this case. Of course, if any overcharges are ultimately found, and rebates are ordered, they will be based on the difference between the rates actually charged by the station and the LUC. Id. at 6662, n.9, and 6663. We also reject WALB's argument that Complainants' SMART calculations are deficient because they consider only a "small part of the total time bought." WALB only speculates that a full analysis might reveal that station rates were below SMART rates in a significant number of dayparts. It does not provide us with any data to support its conjecture. 9. For all the foregoing reasons, we find that Complainants have established a prima facie case of an LUC violation with respect to the rates charged Complainants during the 1994 general election period. Complainants have shown that in a significant number of instances they paid rates greater than the SMART- based rates during that time period. We do, however, agree with WALB that Complainants have not established a prima facie case of an LUC violation with respect to rates charged Complainants during the 1994 primary and runoff elections. Complainants' analysis is limited to time purchased during the 1994 general election period and does not contain the necessary data with respect to the 1994 primary and runoff elections. Specifically, although Complainants include SMART information for the third quarter of 1994, they do not provide copies of invoices for time purchased during the 1994 primary and runoff election periods. Moreover, their calculations are limited to time purchased during the 1994 general election period. Absent such data, the Commission cannot assess the accuracy of Complainants' claims and a prima facie case has not been established. See Lawton Chiles, Bob Martinez, Bill Nelson and Jim Smith, 10 FCC Rcd 940,  13 (MMB 1995) ("WCPX-TV"), citing WTVT(TV), 7 FCC Rcd at 6662-63, 8 FCC Rcd at 132. B. Comparison With Candidate and Commercial Records 10. The Complaint asserts that Wesley Dunn, who was apparently a candidate during the 1994 Georgia elections, was forced by Station WALB-TV to purchase fixed time in order to ensure that his spots would clear. Comparing the rates he was charged with rates paid by the Georgia Lottery and another candidate during the 1994 Georgia elections, the Complaint asserts that Wesley Dunn was overcharged. Moreover, in this regard, allegations are raised with respect to improper steering, refusal to sell at intermediate rates, and failure to disclose. 11. As WALB correctly points out, Wesley Dunn is not a named Complainant. The procedures established for a prima facie analysis of LUC complaints are designed to protect the interests of the "parties" and to remedy apparent overcharges to "complaining candidates." Reconsideration Order. 7 FCC Rcd at 4127. Wesley Dunn is not named as a party to this proceeding and cannot be considered a complaining candidate. Moreover, as WALB states, allegations raised with respect to Wesley Dunn in this regard are not relevant to the allegations made by Complainants. Accordingly, allegations with respect to time purchased by Wesley Dunn are not properly considered in this Order. C. Disclosure 12. Complainants contend that WALB-TV's ratecard is deficient and is in violation of Commission Rules. In support of their allegations, a ratecard provided to Wesley Dunn is attached as Exhibit 7 to the Complaint. Although, as discussed supra, Wesley Dunn is not a named Complainant, WALB admits that the same ratecard was provided to Complainants. Accordingly, on that basis, we shall consider Complainants' allegations in this regard. 13. Complainants assert that the ratecard available to candidates failed to disclose a 7-9 a.m. daypart, and perhaps others. Specifically, pointing to WALB-TV's ratecard in effect during the 1994 general election, Complainants contend that WALB offered only 7-8 a.m. ($115 fixed) or a 8-9 a.m. ($110 fixed) dayparts to candidates, but that it sold a 7-9 a.m. daypart for $110 to the Georgia Lottery. Complainants assert that "a candidate may not care" whether a spot ran from 7-8 a.m. or 8-9 a.m. and would have preferred to pay the lower price. WALB responds that the ratecard at issue listed some representative rotations and indicated that other rotations were available upon request. While a licensee has an affirmative obligation to disclose its rates and sales practices to candidates, the "method of disclosure is left to the discretion of individual stations." Codification of the Commission's Political Programming Policies, 7 FCC Rcd 678, 689 (1991) ("Codification Report"); see also 47 C.F.R.  73.1942(b). Moreover, the Commission has held that if a licensee chooses to use a ratecard, it need not list every rotation on the ratecard so long as it states that other classes or rotations are available on request. Codification Report, 7 FCC Rcd at 689. The ratecard at issue listed some rotations and indicated that other rotations were available. Thus, WALB's failure to disclose the availability of the 7-9 a.m. daypart on its ratecard does not constitute a prima facie case of failure to disclose political rate information. 14. Complainants also contend that the WALB-TV's ratecard is deficient because it did not indicate a make good policy for most classes of time and did not disclose information about sales practices based on audience delivery. Again, Complainants rely on WALB-TV's ratecard in effect during the 1994 general election period. WALB responds that although it did not have a "formal" make good policy, it did work "informally" with advertisers to reschedule preempted spots. Answer at 5-6. It asserts that the station did not "generally" sell time based on "audience delivery," apparently conceding, however, that it occasionally sold time on that basis. Answer at 6. Although the lack of information on the ratecard at issue is not dispositive of a violation, the licensee's own Answer (Answer at 6) indicates that WALB-TV, at least during the 1994 general election period, may not have consistently disclosed information about its make good policy and audience delivery practices. Accordingly, we find that a prima facie case of an LUC violation has been established with respect to WALB-TV's disclosure to Complainants of its make good policy and audience delivery sales practices in effect during the 1994 general election period. II. POLITICAL FILE ALLEGATIONS 15. Complainants allege that WALB-TV violated the political file requirements contained in Section 73.1943 of the Commission's Rules. Specifically, the Complaint states that Marc Hershovitz, who was hired by Wesley Dunn's buyer, was permitted access to the public file but not allowed to copy its contents. WALB disputes the allegations. 16. This Order is issued pursuant to procedures for a prima facie analysis of LUC complaints as set forth in the Declaratory Ruling, and allegations of violations of political file violations are not subject to those procedures. Thus, they will be handled as a separate complaint and will not be addressed herein. See Roy Barnes, Johnny Isakson, Zell Miller, et al., DA 97-512, n. 5., released March 11, 1997 ("WMGT-TV"). III. TIMETABLE AND PROCEDURES FOR DISCOVERY 17. In the Declaratory Ruling, the Commission determined that, once a prima facie showing has been made, the complainant will be entitled to limited discovery, subject to specific conditions established by the Bureau. See Declaratory Ruling at 7513-14, 7521, n. 49. See also, WTVT 7 FCC Rcd at 6665. Accordingly, we will allow Complainants limited discovery on the issue of overcharges during the sixty days preceding the November 8, 1994, general election. The documents set forth in Appendix A to this Order, and answers to the written interrogatories set forth in Appendix B to this Order, must be served upon counsel for the above-referenced Complainants (not the Commission) by WALB on or before the first day of the discovery period, which will be 30 days after the release date of this Order. See Appendix C. 18. Any request for further discovery by Complainants must contain a showing that such discovery is necessary to resolve the issue of overcharges. Any discovery request by WALB for production of documents, answers to written interrogatories, or for the taking of depositions must demonstrate that the information requested is necessary for WALB to respond to arguments or claims that could be made by Complainants in their amended complaint. We emphasize that any request for depositions must also demonstrate that depositions are necessary to resolution of the issue of overcharges and include a list of the proposed deponents. All discovery requests must be filed within the discovery period set forth in Appendix C. The Bureau will rule on all such requests as expeditiously as possible. 19. Documents produced by WALB that contain proprietary information may be redacted to delete the identities of commercial advertisers, including the name of the commercial advertiser, its address and telephone number, the name(s) of any person employed by the advertiser, and the name of any media company or agency representing the commercial advertisers and any persons employed by such media company or agency. Where any such information is redacted, WALB shall advise Complainants of the type of information deleted. Further redactions will be allowed only if the information redacted is proprietary and not relevant to resolution of the complaint. Should Complainants serve documents upon WALB they may redact proprietary information and so advise WALB of the type of information deleted. Any objections to redactions that are not resolved by the parties should be submitted to the Bureau in a written pleading for resolution, along with copies of the documents at issue with the disputed information intact. As with all discovery matters, the parties should make good faith attempts to resolve any discovery disputes before presenting such a dispute to the Bureau. 20. Any documents, answers to written interrogatories, or deposition transcripts, if any, produced during discovery, and the information revealed thereby, shall not be provided to any third party other than the Commission. Copies of all documents, answers to written interrogatories, and deposition transcripts produced shall be stamped with the statement: "This document is subject to a protective order entered by the Federal Communications Commission." It shall be the responsibility of the party producing the documents, answers to written interrogatories, or deposition transcripts to affix the stamp. 21. The parties must take reasonable measures to prevent unauthorized access to the documents, answers to written interrogatories, and deposition transcripts. Access must be limited to Complainants, the management of WALB-TV, their attorneys and staffs, and expert witnesses. Either party may require the other to disclose in writing the names of staff and experts who have access to documents and written information. Each party must explain to all staff and experts that the documents, answers to written interrogatories, deposition transcripts, and their contents may not be disclosed to any entity other than the Commission. 22. None of the materials produced, nor the contents thereof, may be used for any purpose other than the prosecution of the instant complaint. Each individual who is provided access to these materials is hereby required to certify in writing that he or she has personally reviewed this Order and understands the limitations imposed on the signing party. No copies of materials protected by this Order may be made except copies to be used by the persons identified in paragraph 25. Each party shall maintain a log recording the number of copies made of all proprietary material and the persons to whom the copies have been provided. Upon termination of this proceeding, including any appeals, petitions or settlement, all originals and reproductions of any protected materials, along with the log recording persons who received copies of such materials, shall be provided to the producing party. In addition, upon final termination of the proceeding, any notes or other work product derived in whole or in part from the protected materials of an opposing party shall be destroyed. 23. The parties may agree to additional reasonable measures to protect the confidentiality of information as the circumstances may warrant. Such agreement should be confirmed in writing and a copy provided to the Bureau. As noted in the Declaratory Ruling, any failure to abide by the terms of this protective order may result in the imposition of sanctions, including dismissal of the complaint or censure, suspension, or disbarment of the attorneys involved. See 47 C.F.R.  1.24. 24. Extensions of the discovery period (Appendix C) will be granted only where extraordinary circumstances exist and the parties agree to the extension, or both parties submit declarations that serious settlement discussions are ongoing. Any deadlines within the discovery period may be changed by mutual agreement, with notification to the Bureau, as long as all discovery is completed within the required time. Service of documents, discovery requests, and any pleading which requires a ruling by the Bureau is to occur by the dates set in Appendix C, unless modified by the Bureau or by mutual agreement of the parties. 25. Within 30 days after completion of discovery, Complainants must file an amended complaint, alleging specific facts based on the information discovered, stating the nature of the  315(b)(1) violation and the amounts said to be owed. After WALB has filed its answer, the parties shall file with the Bureau their election to have the complaint resolved either by the Bureau or by Alternative Dispute Resolution. 26. Settlement of lowest unit charge claims is strongly encouraged. Although the Commission retains its discretion to determine whether additional sanctions are warranted, the Commission is inclined to look with favor upon a settlement in making that determination. See Declaratory Ruling, at 7521, n. 52. 27. ACCORDINGLY, we find that a prima facie case of a violation of the LUC requirements of Section 315(b)(1) of the Communications Act has been established by Complainants in connection with advertising aired on WALB-TV on their behalf during the sixty days preceding the November 8, 1994, general election. The parties are hereby ORDERED to follow the procedures and timetable for discovery, post-discovery, and election of a complaint resolution procedure established herein. 28. We find that Complainants have failed to establish a prima facie case of an LUC violation by WALB-TV during the period before the July 19, 1994, primary and the August 9, 1994, runoff election. Thus, their claims as to the 1994 primary and runoff elections against WALB-TV are DISMISSED in their entirety. Finally, we DISMISS Complainants claims with regard to public file violations as those allegations are not properly considered here. FEDERAL COMMUNICATIONS COMMISSION Roy J. Stewart Chief, Mass Media Bureau APPENDIX A DOCUMENTS TO BE PRODUCED TO COMPLAINANTS To the extent not already produced to Bureau and Complainants, certain documents shall be produced to Complainants Zell Miller and Guy Millner by WALB by delivering them to the offices of Barnes, Browning, Tanksley & Casurella, 166 Anderson Street, Suite 225, Marietta, Georgia 30060 in accordance with the procedures outlined in this Order. The documents to be produced are as follows: 1) All advertising contracts executed by or on behalf of candidates for public office in connection with the 1994 general election. 2) All invoices, logs or other documents recording time, duration, or class of advertising time for each political advertisement ordered and/or aired on behalf of candidates for public office in connection with the 1994 general election. 3) Copies of invoices and contracts for, and program logs related to: all commercial time run on WALB-TV beginning on September 9, 1994, and running through November 8, 1994, (the 60 days preceding the general election). This should include: a) All invoices, logs or other documents recording time, duration, or class of advertising time for each commercial spot aired, and, if not apparent from the preceding, documents reflecting all agency discounts provided by the station; b) All long term contracts that pertain to commercial spots, including make goods and bonus spots, that aired during this period; c) All addenda or memoranda relating to these invoices or contracts that alter or otherwise address the terms or provisions of any document subject to production pursuant to this document production order; d) All orders for commercial spots aired during this period, including confirmation orders or contracts; e) All orders for bonus spots, public service announcements, or any other type of free spots, for any of the commercial advertisers who purchased time that ran during this period; f) All documents that describe the rate and other relevant terms (those that affect price or have a direct bearing on the characteristics, such as class of time, or any priorities against preemption, of each spot) of discount packages sold to commercial advertisers that included spots that aired during this period; g) All documents regarding make goods provided to any commercial advertiser; and h) All documents that reflect promises of certain audience delivery to any commercial advertiser. 4) All documents used by WALB-TV to explain to its sales personnel or other employees or agents dealing with political campaigns, or the agents of political campaigns, the application of the lowest unit charge provisions of Section 315(b) of the Communications Act. This should include any written policy statement(s) used by WALB-TV in 1994 which directly or indirectly related to WALB-TV's pricing policies during the 1994 general election LUC period. 5) All documents reflecting the existence, implementation, and results of any audit of rates charged to political advertisers performed by or on behalf of WALB-TV with respect to the 1994 general election, including any provision of rebates to such political advertisers, as well as all documents explaining or detailing the methodology used by in performing any such audit or providing any such rebates. APPENDIX B ADDITIONAL INFORMATION TO BE PROVIDED TO COMPLAINANTS Answers to the following interrogatories shall be provided to Complainants Zell Miller and Guy Millner in accordance with the procedures set forth in this Order: 1) Describe how WALB-TV arrived at its LUC for the 1994 general election period. 2) Detail any actions taken by WALB-TV to ensure that political advertisers were, in fact, charged the lowest unit rate for the same class and amount of time during the same time periods which ran during the sixty days preceding the 1994 general election. This should include the identities of all individuals taking or participating in such action, identifying their position at WALB-TV, and should identify all documents which refer to or formed a part of WALB-TV's efforts to ensure that candidates received the LUC. 3) Provide a statement that indicates the class and length of each commercial spot, if not apparent from the program logs, invoices or contracts, that aired during the relevant time period. 4) Provide a statement that explains any codes used by WALB-TV or its sales representatives to indicate the rate, section or class of spot identified in confirmation contracts, program logs, affidavits of actual broadcast or other documents relating to advertising rates. 5) Provide a statement that explains to what extent, if any, WALB-TV accorded any priorities against preemption to commercial advertisers who purchased time relevant to the 1994 general election period. To the extent that such priorities against preemption were given, explain whether this priority treatment was known to any commercial advertiser when the time was contracted for. APPENDIX C TIMETABLE FOR DISCOVERY AND POST-DISCOVERY First day of discovery period (30 days after release of this Order):Day 1 Documents in Appendix A and Answers to Written Interrogatories in Appendix B due:Day 1 Request by Complainants for further discovery (production of additional documents, answers to additional written interrogatories, and/or for the taking of depositions) due: Day 15 Opposition by WALB to Complainants request for further discovery due:Day 20 WALB's request for discovery (production of documents, answers to written interrogatories, and/or for the taking of depositions) due: Day 20 Opposition by Complainants to WALB's request for discovery due: Day 27 Documents and answers to written interrogatories (if allowed by Bureau) pursuant to WALB's request for discovery due:Day 45 Production of additional documents and/or answers to additional written interrogatories (if allowed by Bureau) pursuant to Complainants request for further discovery due:Day 60 Final day of discovery period:Day 60 Complainants amended complaint due:Day 90 WALB's answer to amended complaint due: Day 105 Joint notice of election of complaint resolution procedure due:Day 116