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                                   Before the

                       Federal Communications Commission

                             Washington, D.C. 20554

     In the Matter of                                                        
                                             )   EB-04-IH-0660               
     Emmis Communications Corporation                                        
                                             )   NAL/Acct. No. 200432080193  
     Emmis Radio License Corporation                                         
                                             )   FRN No. 0004161410          
     Licensee of Station WKQX(FM),                                           
     Chicago, Illinois                       )   FRN No. 0001529346          
     Forfeiture Order rel. Jan. 8, 2002      )   Facility ID No. 19525       
     (DA 02-26)                                                              
                                             )   NAL/Acct. No. 200132080029  
     Forfeiture Order rel. Nov. 1, 2002                                      
     (DA 02-2937)                            )   NAL/Acct. No. 200232080008  
     Forfeiture Order rel. Feb. 18, 2004     )   NAL/Acct. No. 200232080014  
     (DA 04-386)                                                             

                            ORDER ON RECONSIDERATION

   Adopted: October 10, 2006 Released: October 17, 2006

   By the Commission:

    1. In this Order on Reconsideration, we deny a Petition jointly filed by
       David Smith, the Illinois Family Institute, the Illinois Chapter of
       Concerned Women for America, and Julie Cordry (collectively, the
       "Petitioners"), seeking reconsideration of our Order approving a
       Consent Decree settling enforcement actions against Emmis
       Communications Corporation and its subsidiaries that hold FCC
       authorizations for possible violation of broadcast indecency

   I. Background

    2. Emmis is the Commission licensee of various radio broadcast stations.
       The Commission received complaints that Emmis stations had broadcast
       indecent material over many of those stations, in violation of federal
       law and the Commission's rules. As a result of these complaints, the
       Commission issued three forfeiture orders against Emmis, assessing
       monetary forfeitures against it for violation of the Commission's
       indecency rule. Subsequently, the Commission and Emmis entered into
       the Consent Decree resolving the three forfeiture orders, as well as
       other pending indecency complaints and ongoing indecency
       investigations against Emmis.

    3. Pursuant to the Consent Decree, Emmis admitted that the programming at
       issue in the forfeiture orders, and certain programming that was the
       subject of the pending complaints and ongoing investigations, is
       indecent, in violation of section 73.3999, agreed to make a voluntary
       contribution of $300,000 to the United States Treasury, and adopted a
       "company-wide compliance plan for the purpose of preventing the
       broadcast of material violative of the Indecency Laws." In addition,
       Emmis waived "any and all rights" to contest the validity of the
       Consent Decree or the Order. In return, the Commission agreed to
       rescind, vacate and cancel the forfeiture orders, terminate its
       pending inquiries into possible indecency violations by Emmis
       stations, and dismiss any pending indecency complaints against Emmis.
       The Commission also agreed not to use the facts of the Consent Decree,
       the forfeiture orders, the pending inquiries or complaints, "or any
       similar complaints" regarding programming aired before the Consent
       Decree's effective date for any purpose relating to Emmis or its
       stations, and to treat all such matters as null and void.

    4. On August 12, 2004, the Commission released its Order adopting the
       Consent Decree. The Commission found that "the public interest would
       be served by approving the Consent Decree and terminating all pending
       proceedings against Emmis" relating to possible indecency violations.
       Based upon its examination of the record, the Commission also
       concluded that there were "no substantial and material questions of
       fact in regard to these matters as to whether Emmis possesses the
       basic qualifications, including its character qualifications, to hold
       or obtain any FCC licenses or authorizations."

    5. Petitioners argue that the Commission "essentially allowed Emmis to
       purchase a finding of basic character qualifications." More
       specifically, they contend that the Order is ultra vires because it
       prevents the Commission from considering Emmis's apparent indecency
       violations in making the statutory determination whether grant of
       Emmis's pending renewal applications would serve the public interest.
       They also maintain that the Order is arbitrary and capricious, and
       inconsistent with Commission precedent, because it requires the agency
       to "ignore a portion of [Emmis's] record in the license term
       immediately preceding a renewal application."

   II. discussion

    6. We disagree with Petitioners' contention that we lack the requisite
       authority to have settled our indecency enforcement actions against
       Emmis. As a general matter, an agency is presumed to have the
       discretion to settle or dismiss an enforcement action. In addition,
       the Communications Act of 1934, as amended (the "Act"), provides the
       Commission "broad discretion" to settle enforcement actions. Here, we
       properly exercised that discretion by means of the Consent Decree,
       under which Emmis admitted that its stations had broadcast indecent
       material in violation of the Commission's rules and agreed to
       substantial remedial obligations, including making a $300,000
       voluntary payment to the United States Treasury and adoption and
       implementation of a multi-year compliance plan designed to prevent
       future indecency violations. Our agreement in return to terminate the
       pending enforcement actions against Emmis, and not to consider the
       facts related to such actions in connection with other Emmis
       applications, "simply represents the quid pro quo that the agency
       found necessary to procure" Emmis's agreement to resolve these
       matters. These undertakings were within our broad discretion to settle
       enforcement actions. Thus, the Order represents a valid and
       appropriate exercise of our authority to settle enforcement actions.

    7. We also disagree with Petitioners' contention that we abused our
       discretion by approving the Consent Decree. First, we did not agree to
       ignore the character issues raised by Emmis's apparent indecency
       violations, as Petitioners suggest. Rather, we fully considered all
       potential character qualifications issued raised by Emmis's apparent
       indecency violations and specifically determined that they did not
       raise substantial and material questions of fact as to whether Emmis
       possesses the requisite qualifications necessary to be a Commission
       licensee.  Had we not so concluded, we could not have agreed to the
       provisions of the Consent Decree regarding our use of the facts here
       in connection with future applications. Having already fully
       considered those matters, we need not reexamine the same issues in a
       different proceeding. Moreover, our determination was consistent with
       the record before us. Generally, the Commission's concern in
       evaluating the impact of wrongdoing on a licensee's character is the
       licensee's probable future behavior. Emmis's acknowledgment in the
       Consent Decree of responsibility for violating indecency restrictions
       is a step towards ensuring that it does not repeat such violations.
       Likewise, the company-wide compliance plan that Emmis agreed to
       implement as part of the Consent Decree will help to avoid future


    8. IT IS ORDERED, that the Petition for Reconsideration jointly filed by
       David Smith, the Illinois Family Institute, the Illinois Chapter of
       Concerned Women for America, and Julie Cordry is hereby DENIED.

    9. IT IS FURTHER ORDERED, that copies of this Order on Reconsideration
       shall be sent by Certified Mail, Return Receipt Requested, to Dennis
       J. Kelly, Esquire, counsel for David Smith, Illinois Family Institute,
       Illinois Chapter of Concerned Women for American and Julie Cordry,
       Post Office Box 41177, Washington, DC, 20018, and John E. Fiorini,
       III, Esquire and Eve Klindera Reed, Esquire, counsel for Emmis
       Communications Corp., Wiley Rein & Fielding LLP, 1776 K Street, N.W.,
       Washington, D.C. 20006.


   Marlene H. Dortch


   Petition for Reconsideration jointly filed by David Smith, et al.
   (September 13, 2004) (Petition).

   Emmis Communications Corp., Order, 19 FCC Rcd 16003 (2004) ("Order"). The
   Consent Decree is attached to and incorporated by reference in the Order.

   We collectively refer to Emmis Communications Corporation and all of its
   direct and indirect subsidiaries that hold Commission broadcast licenses
   herein as "Emmis."

   See 18 U.S.C. S 1464 (prohibiting the utterance of "any obscene, indecent,
   or profane language by means of radio communication"); 47 C.F.R. S

   Emmis FM License Corp. of Chicago, Forfeiture Order, DA 02-26, released
   January 8, 2002 (File No. EB-00-IH-0401), review denied, Emmis Radio
   License Corp., Memorandum Opinion and Order, FCC 04-62, released April 8,
   2004; Emmis Radio License Corp., Forfeiture Order, DA 04-386, released
   February 18, 2004 (File No. EB-01-IH-0121); Emmis Radio License Corp.,
   Forfeiture Order, released November 1, 2002 (File Nos. EB-01-IH-0124,
   EB-01-IH-0319, and EB-01-IH-0408, DA 02-2937).

   Consent Decree, 19 FCC Rcd at 16008, P 13.

   Id. at 16007, P 11.

   Id. at 16007, P 10. A summary of the Compliance Plan is attached to the
   Consent Decree.

   Id. at 16008, P 12.

   Id. at 16007, P 8.

   Id. The Commission further agreed not to "initiate any inquiries,
   investigations, forfeiture proceedings, hearing, or other sanctions or
   actions against Emmis, any Emmis Station, or any pending or future
   application to which Emmis is a party" based on the FOs, the inquiries, or
   the complaints pending prior to the Consent Decree's effective date. Id.
   Petitioners are concerned about two license renewal applications pending
   before the Commission for Emmis stations: that for Station WKQX(FM),
   Chicago, Illinois, File No. BRH-20040802AQH, and that for Station
   KPNT(FM), Ste. Genevieve, Missouri, File No. BRH-20041001AHL. Petition at
   3; see infra, n. 17.

   Order, 19 FCC Rcd 16004, P 3.

   Id. at 16004, P 4.

   Petition at 2.

   Id. at 7. See 47 U.S.C. S 309(a).

   Petition at 2; see id. at 7-8.

   Petitioners Smith and Cordry have standing before us to seek
   reconsideration, having filed indecency complaints against Emmis Stations
   WKQX(FM), Chicago, Illinois and KPNT(FM), Ste. Genevieve, Missouri, that
   have been dismissed by operation of the Consent Decree. Petition  at 3;
   see Order, 19 FCC Rcd at 16004, n. 7. Accordingly, we need not address
   whether the other Petitioners have standing before us based on their
   expressed intent to file a petition to deny the license the Emmis renewal
   application for Station WKQX(FM). Petition at 3.

   Heckler v. Chaney, 470 U.S. 821, 831 (1985) ("This Court has recognized on
   several occasions over many years that an agency's decision not to
   prosecute or enforce, whether through civil or criminal process, is a
   decision generally committed to an agency's absolute discretion.")
   (citations omitted); Schering Corp. v. Heckler, 779 F.2d 683, 685 (D.C.
   Cir. 1985) (FDA's decision to take a voluntary dismissal of an enforcement
   action and to agree not to file a new action for eighteen months "f[ell]
   squarely within the confines of Chaney.").

   Parents Television Council, Inc. v. FCC, 2004 WL 2931357 (D.C. Cir. 2004)
   (holding that decision to enter into the Consent Decree at issue in that
   case was a nonreviewable exercise of agency discretion); NY State Dep't of
   Law v. FCC, 984 F.2d 1209, 1215 (1993) (citing S.Rep. No. 580, 95^th
   Cong., 1^st Sess. 25 (1977)).

   See Consent Decree, 19 FCC Rcd at 16007-08, P 10-13.

   Schering Corp. v. Heckler, 779 F.2d 683, 687 (D.C. Cir. 1985).

   We note that Petitioners' suggestion that the settlement discussions
   leading to the Consent Decree violated the Commission's ex parte rules
   lacks merit. Petition at 3-4. The settlement discussions fall within the
   exception to the general prohibition of ex parte communications in
   restricted proceedings for communications "requested by (or made with the
   advance approval of) the Commission or staff for the clarification or
   adduction of evidence or for the resolution of issues, including possible
   settlement." 47 C.F.R. S 1.1204(a)(10); see NY State Dep't of Law, 984
   F.2d at 1217-18.

   Order, 19 FCC Rcd at 16004, P 4.

   See Stockholders of Infinity Broadcasting Corp., Memorandum Opinion and
   Order, 12 FCC Rcd 5012, 5057 n.1 (1996) (challenges to the applicant's
   character qualifications based on past apparent indecency violations were
   moot where the Commission previously determined that such violations were
   not disqualifying and agreed to expunge them from the applicant's record
   for all purposes under the terms of an agreement settling indecency
   enforcement proceedings).

   See Policy Regarding Character Qualifications in Broadcast Licensing,
   Report, Order, and Policy Statement, 102 FCC 2d 1179, 1183, P 7 (1986)
   recon. denied, 1 FCC Rcd 421 (1986), appeal dismissed sub nom. National
   Association for Better Broadcasting v. FCC, No. 86-1179 (D.C. Cir. Jun.
   11, 1987) ("Character Policy Statement"). (character inquiries "focus on
   the likelihood that an applicant will . . . comply with the Communications
   Act and our rules and policies."); id. at 1189, P 21 (character inquiries
   "should be narrowly focused on specific traits which are predictive of an
   applicant's propensity to . . . comply with the Communications Act or the
   Commission's rules and policies.") See also Policy Regarding Character
   Qualifications in Broadcast Licensing, Amendment of Part 1, the Rules of
   Practice and Procedure, Relating to Written Responses to Commission
   Inquiries and the Making of Misrepresentation to the Commission by
   Applicants, Permittees, and Licensees, and the Reporting of Information
   Regarding Character Qualifications, Policy Statement and Order, 5 FCC Rcd
   3252 (1990), recon.granted in part, denied in part, 6 FCC Rcd 3448 (1991),
   modified, 7 FCC Rcd 6564 (1992) ("1990 Modifications of Character Policy

   See id. at 1129, P 106 ("rehabilitation is significant. We find that the
   factors which we have already determined to consider, including . . .
   efforts to remedy the situation, are good evidence of whether
   rehabilitation has occurred.").

   See id. at 1227-28, P 102 (whether corrective action has been taken is an
   appropriate factor for analysis in character inquiries).

   (...continued from previous page)


   Federal Communications Commission FCC 06-152


   Federal Communications Commission FCC 06-152