******************************************************** NOTICE ******************************************************** This document was converted from WordPerfect to ASCII Text format. Content from the original version of the document such as headers, footers, footnotes, endnotes, graphics, and page numbers will not show up in this text version. All text attributes such as bold, italic, underlining, etc. from the original document will not show up in this text version. Features of the original document layout such as columns, tables, line and letter spacing, pagination, and margins will not be preserved in the text version. 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 the Matter of ) ) Liability of EZ Sacramento, Inc. ) ) Licensee of Radio Station KHTK(AM), ) Sacramento, CA ) ) For a Forfeiture ) MEMORANDUM OPINION AND ORDER & FORFEITURE ORDER Adopted: August 19, l999 Released: August 20, l999 By the Chief, Mass Media Bureau: 1. The Commission, by the Chief Mass Media Bureau, acting pursuant to authority delegated by Section 0.283 of the Commission's Rules, has before it for consideration (1) a Notice of Apparent Liability ("NAL"), released April 2, 1999, assessing a forfeiture of $4,000 against EZ Sacramento, Inc. (EZ Sacramento), licensee of Station KHTK(AM), Sacramento, CA, for violation of Section 73.1206 of the Commission's Rules and (2) EZ Sacramento, Inc.'s May 13,1999, response to the Commission's Notice of Apparent Liability requesting that the NAL be dismissed. 2. The NAL assessed a $4,000 forfeiture against EZ Sacramento for willful violation of Section 73.1206 of the Commission's Rules by broadcasting a portion of a telephone conversation between the complainant and her sister without the complainant's knowledge. The facts of the case are set forth in detail in the NAL and will not be repeated here. 3. In support of its request that the forfeiture be dismissed, EZ Sacramento contends that Station KHTK(AM) did not violate Section 73.1206 since the complainant was informed that her conversation was about to be broadcast before it was aired. EZ Sacramento states that the portion of the conversation during which the complainant was told that she was placed on "hold," when she really was not, should not be considered as a separate and distinct segment, and the requirement of additional notification is not supported by the language of the Rule. Moreover, EZ Sacramento argues that the Bureau's position represents a novel interpretation of the rule which "violates fundamental principles of administrative fairness." We disagree. The fundamental purpose of adopting Section 73.1206 is to protect "the legitimate expectations of privacy in connection with the broadcast use of telephone conversations." Amendment of Section 1206: Broadcast of Telephone Conversations, 3 FCC Rcd 5461 at 5463 (1988). In broadcasting the sisters' telephone conversation while they were allegedly "on hold" without prior notice, Station KHTK(AM) did precisely that which the rule prohibits, and in the process abused the privacy expectation that the rule confers. 4. EZ Sacramento also argues that since the broadcast was part of a humorous game show segment of the program, the complainant should have "expected the unexpected" for the duration of the conversation. Again, this is not consistent with Commission interpretation of Section 73.1206 of the Rules. A May 18, 1972, Policy Statement was issued specifically to address the broadcast of telephone conversations during entertainment segments involving contests or "practical jokes." This publication states that in such situations, "the results are sometimes shocking and harmful to a degree not expected, and such results can be avoided by strict adherence to Section 73.1206 of the Rules." 35 FCC 2d 940 (1972). Moreover, in 1988 the Commission specifically reviewed Section 73.1206 to determine whether it should be relaxed to "enhance the entertainment value and audience appeal of a station's programming." Amendment of Section 1206, 3 FCC Rcd at 5464. The Commission specifically ruled that "we cannot conclude that such enhancement of programming appeal is sufficiently critical as to justify intruding on individual privacy." Id. Thus, we cannot condone the station's attempt to increase the humor of its segment by broadcasting a conversation that the parties reasonably believed was private. 5. EZ Sacramento also contends that the forfeiture should be rescinded because of a transfer of control of the licensee that occurred subsequent to the violation. Specifically, it contends that at the time of violation, EZ Sacramento was controlled by American Radio Systems Corporation ("ARS"), but that CBS Corporation purchased ARS' stock on June 4, 1998. Citing to KTBB Radio, Inc., 10 FCC Rcd 13046 (MMB 1995); Grant Broadcasting System II, Inc., Ref. No. 1800C1-JEE (MMB 1997); and First Media of Monterey, 7 FCC Rcd 4589 (MMB 1992), the licensee argues that the Commission imposes sanctions only against the entity or shareholders in control of the station at the time of violation, not against any successor owner. These cases are clearly distinguishable. In each of the cited cases, there was an assignment of a station to a new licensee. In this case, although the shareholders have changed, the entity which holds the Commission license has not. Transfer of control of the licensee's stock subsequent to a violation does not excuse the licensee for the violation. See Winslow Communications, Inc., 45 FCC 2d 662, 663 (1974) ("It is the licensee which is responsible for compliance and not the individual stockholders. The transfer of control of stock of the licensee corporation subsequent to the violations does not excuse the licensee of the violations.") Accordingly, assessment of a forfeiture against EZ Sacramento is appropriate. 6. Accordingly, EZ Sacramento's request that the NAL be dismissed is DENIED, and IT IS ORDERED THAT pursuant to Section 503(b) of the Communications Act, EZ Sacramento, Inc., licensee of Station KHTK(AM), Sacramento, CA, FORFEIT to the United States of America the sum of Four Thousand Dollars ($4,000) for the willful violation of Section 73.1206 of the Commission's Rules. Payment of the forfeiture may be made by mailing a check or similar instrument payable to the Federal Communications Commission at the address indicated in the attachment to this Memorandum and Opinion and Order. FEDERAL COMMUNICATIONS COMMISSION Roy J. Stewart, Chief Mass Media Bureau Attachment