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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 ) ) LAWTON CHILES, BOB MARTINEZ, ) and BILL NELSON ) ) Against Station WCPX-TV ) Orlando, Florida ) MEMORANDUM OPINION AND ORDER Adopted: June 5, 1997 Released: June 19, 1997 By the Commission: 1. On January 17, 1995, the Chief, Mass Media Bureau, dismissed a complaint filed on behalf of Lawton Chiles, Bob Martinez, and Bill Nelson (hereinafter, collectively, "Complainants") against Station WCPX-TV, Orlando, Florida. Lawton Chiles, Bob Martinez, Bill Nelson and Jim Smith, 10 FCC Rcd 940 (MMB, 1995). Complainants alleged that WCPX-TV overcharged them during the September 4, 1990, primary and the November 6, 1990, general election campaigns in violation of the lowest unit charge ("LUC") requirements of Section 315(b) of the Communications Act of 1934, as amended. The Commission now has before it Complainants' February 1, 1995, application for review of that action and related pleadings. 2. Complainants assert that the Bureau erred in dismissing their complaint. Complainants contend that the Bureau should have found the Spot Cost Outlook and Projections ("SCOOP") data they submitted sufficient to establish a prima facie case of an LUC violation. They assert that their complaint complied with the requirements set forth in our Declaratory Ruling and in WTVT. They contend that the Declaratory Ruling says nothing about average rate methodology and that WTVT required specificity only as to which monthly reports were utilized. They argue that it was only after their complaint was filed that the Commission adopted requirements for details regarding ratings and candidate specific information. Complainants maintain that the Bureau erred in holding them to a standard which did not exist at the time they filed their complaint. They argue that the Bureau should have accepted their Request for Leave to Supplement which provided additional data in support of their complaint and that the Bureau's refusal to do so was inconsistent with its actions in KABC-TV where supplementary material was accepted. Additionally, Complainants contend that even if the supplement were properly rejected, the data submitted with their complaint was sufficient. Specifically, they allege that in a similar case, KCRA-TV, the Bureau found that the same type of data which Complainants included in their complaint in this case established a prima facie case of an LUC violation. Complainants maintain that, in reviewing this type of complaint, Commission staff is required to draw all inferences in favor of complainants and that, had it done so in this case, it would have found a prima facie case of overcharges. 3. Complainants further contend that the Bureau erred in refusing to find that the station's issuance of rebates was, in and of itself, sufficient to establish a prima facie case of an LUC violation. They oppose the Bureau's conclusion that it would be unfair to find that the station had made untimely rebates because it was not until 1991, after the LUC period at issue, that the Commission specifically required that all rebates be made in a timely fashion. Specifically, they argue that since the rebates were made "well after the election, and only after inquiry by counsel," they must be found to be untimely and evidence of an LUC violation. In support of their assertion, they cite to the FCC's 1984 Political Primer which states that "[p]ost-election restitution to candidates does not excuse overcharge." Further, they contend that the staff's "exclusion of rebate evidence . . . sets a terrible precedent" which allows a licensee to avoid a finding of LUC violation simply by issuing rebates to remedy its overcharges. Under this precedent, Complainants assert, a prima facie case of LUC violation can never be found so long as the station issues refunds. 4. Finally, Complainants claim that the staff erred in concluding that WCPX-TV had not steered candidates to higher rates. They assert that the Bureau failed to answer their questions concerning the structure of the station's rate card. In addition, they question why, if the rate card listed two types of fixed rates, one suggested for candidates only, time was sold to candidates at the higher-priced commercial fixed rate. Finally, they contend that the use of the word "suggested" on a rate card is, in and of itself, sufficient to find impermissible steering from preemptible to fixed rates. 5. In opposition to the application for review, WCPX License Partnership ("WCPX"), licensee of Station WCPX-TV, maintains that Complainants failed to provide any supporting details identifying and describing the use of SCOOP data. WCPX adds that Complainants' supplement was properly rejected, since its acceptance would have permitted Complainants to furnish data on a piecemeal basis when they were on notice that this would not be allowed. With respect to post-election rebates, the licensee argues that the Commission should not automatically equate rebates with violations of the rules. In that connection, WCPX notes that the exact lowest unit charge for a particular block of time often cannot be known until after the spots have aired because of "the need to factor in bonus spots, make goods and long term contracts and the need to conduct audits in order to catch the results of simple human error." WCPX contends that punishing a station for issuing rebates would be unfair since it would penalize a station for complying with Commission Rules. 6. WCPX also denies that it steered Complainants to purchase time at higher rates. In that regard, the licensee maintains that Complainants have not submitted any statement that they or their buyers were actually misled, misinformed, or steered to purchase higher rates. It contends that the use of the adjective "suggested" on its rate card does not, in the absence of any evidence to the contrary, constitute steering. In response to Complainants' specific questions regarding the "suggested" rate, the licensee reiterates that the rate card listed two types of fixed rates. One was a fixed rate for all commercial advertisers and the other was a fixed rate suggested for candidates, so that candidates and their buyers would be aware of the advantages the station was giving them. WCPX admits that, because of the way orders were placed, "orders were on occasion placed at the [commercial] fixed rather than the suggested [candidate] rate." The licensee contends, however, that the "vast majority of sales of fixed time were at the suggested rate," and that rebates were made when candidates were charged the commercial fixed rate. It points out that of the four examples given by Complainants of such overcharges, only one is accurate and relevant to the complaint before us. 7. Finally, in the event we conclude that the staff incorrectly applied Commission policy to the underlying complaint, the licensee urges us to reconsider the general acceptance of SCOOP-based estimates. Such estimates, it claims, are mere projections of estimated costs-per- point for broad dayparts made months before the actual broadcasts which do not reflect information received from stations or differences in classes of time. WCPX asserts that SCOOP estimates "significantly understate" rates and can be "manipulated by candidates to their own advantage." In support of its position, WCPX compares the SCOOP estimates for the 4th quarter of 1994 with information printed in Monitor Plus, a monthly Nielsen service which tracks spots actually broadcast. WCPX claims that such a comparison demonstrates that SCOOP estimates result in projected costs-per-point which are materially lower than costs-per-point based upon actual commercial airings. As an illustration of how SCOOP data can be manipulated, WCPX submits a chart listing the different SCOOP rates for the same daypart that can be achieved by varying the demographics selected and the ratings service used. 8. In its reply pleading, Complainants reiterate their belief that the SCOOP data they submitted satisfy the standards set forth in our Declaratory Ruling and in WTVT. In addition, they continue to argue that their supplement should have been accepted. They contend that even if the complaint did not contain all the necessary SCOOP data, rejection of the supplement is too harsh a penalty, particularly since the supplement was filed one week after the decisions on which it was based and well before the Bureau's decision to dismiss their complaint. Complainants also restate their argument that the data they included in their complaint was the same type as that submitted in KCRA-TV, where a prima facie case was found. Finally, Complainants again urge us to draw any inferences in this case in their favor. They claim that even the chart WCPX submitted in its opposition to the application for review demonstrates that, taking the highest SCOOP estimate, overcharges were found in the majority of cases when compared with the station's "suggested" rate. DISCUSSION 9. We agree with the Bureau's decision in this case. The Complainants failed to provide the necessary information to support their complaint as required by WTVT. WTVT imposed a new standard of specificity, requiring complainants to provide precise information regarding the manner in which generally-available average rates are used to support complaints. WTVT does not suggest, as Complainants contend, that the requirement to provide complete data was limited to matters such as monthly reports. WTVT, 7 FCC Rcd at 6662-63, 8 FCC Rcd at 132. As the Bureau noted, while Complainants submitted SCOOP data for the market, they did not identify the station specific ratings used in their analysis or the source of the rating data. Consequently, the linkage between general market data and specific station rates was missing, and the Bureau properly concluded that it was unable to determine the accuracy of the complaint. The Bureau's ruling in this regard was not, as Complainants assert, the result of its failure to draw all inferences in favor of complainants, but simply resulted from the lack of data necessary to draw such inferences. 10. Although Complainants contend that the Bureau was able to find a prima facie case in KCRA-TV using exactly the same data, this is not the case. In KCRA-TV, the station itself submitted data which, in combination with that provided by the Complainants, was sufficient to allow the Bureau to find a prima facie case of an LUC violation. Our Declaratory Ruling states that in determining whether or not a prima facie case has been made, the Bureau is to consider both the complaint and the answer. 6 FCC Rcd at 7513. 11. In addition to imposing a new standard of specificity requiring complainants to provide more precise information regarding the manner in which average rates are utilized, WTVT limited the pleadings in an LUC case to the complaint and a response. It specifically stated that any additional pleadings would not be considered unless: . . . the information presented is new and vital to the resolution of the complaint, and could not have been included in the original complaint because the facts were previously unknown or unavailable to the complainant, and could not have been discovered through reasonable efforts. 7 FCC Rcd at 6661. Since Complainants did not satisfy these criteria, their request to supplement their complaint was properly denied. The KABC-TV case differs from the instant case because the complaint there was filed four months before the WTVT decision, and supplementary data was admitted in order to afford the complainants an opportunity to comply with the new WTVT standard. In the instant case, however, Complainants filed their complaint two months after the WTVT decision and were, therefore, on notice as to the new standard. KABC-TV and WCPO-TV, released after WTVT, did not, as Complainants contend, set new standards. Rather, they are simply Bureau rulings which, in each case, explain why the data submitted by the complainants was insufficient to comply with the WTVT standard. Consequently, the Bureau properly excluded Complainants' supplementary showing. 12. Turning to the question of rebates, we uphold the Bureau's finding that the mere issuance of rebates is not, in and of itself, sufficient to establish a prima facie case of an LUC violation. While we agree that the issuance of rebates indicates that purchasers of time were initially charged more than the lowest unit rate, we have recognized that this may occur for any number of reasons, not all of which constitute violation of our rules. Stations will frequently need to review their sales records after the fact in order to determine the accurate lowest unit charge. Were the mere issuance of rebates to be prima facie evidence of a violation, stations would be discouraged from conducting such audits and issuing rebates unless a complaint has been filed. Although in the instant case, the licensee did not issue rebates until more than one year after the election, the election at issue was held before we enunciated our "timeliness" policy in 1991, and the Bureau properly did not apply that new standard. We reject Complainants' argument that the FCC's 1984 Political Primer required Station WCPX to issue "timely" rebates before 1991. The FCC's 1984 Political Primer simply states that "post-election restitution" does not excuse past violations. 100 FCC 2d at 1517. The Bureau's ruling does not hold otherwise. The Bureau did not find that rebates remedy or excuse violation of our rules. Rather, the Bureau held that evidence of rebates does not, without more, constitute a prima facie case of an LUC violation. Thus, there is no merit to Complainants' contention that an LUC violation can never be found so long as a licensee issues rebates. 13. We also uphold the Bureau's finding that Complainants did not establish a prima facie case that Station WCPX misled or attempted to "steer" them toward the purchase of higher- priced spots. While Complainants may now argue over the meaning of the word "suggested" and may raise questions about the station's rate card, in the absence of any evidence that they or their representatives were actually confused or misled by the station's rate card at the time the spots were purchased, we cannot find a prima facie case of steering. Complainants' allegations that candidates may have purchased time at the higher-priced commercial fixed rate, instead of the lower-priced candidate "suggested" rate, does not persuade us otherwise. The record before us reveals only one instance where a Complainant purchased time at the commercial fixed rate. Moreover, the station has explained that the sale of commercial fixed time to candidates was rare and that rebates were issued. 14. Finally, we reject the licensee's request that we reconsider our general acceptance of SCOOP-based estimates. As was stated in WTVT, without the use of such data, it would be difficult for a candidate to demonstrate a prima facie case of an LUC violation, and we will continue to accept such data, as long as it is utilized together with the specific station's actual ratings. 15. Accordingly, for the reasons set out above, Complainants' application for review is DENIED. FEDERAL COMMUNICATIONS COMMISSION William F. Caton Acting Secretary