Douglas Pelley

P.O. Box 4355

Mesa, AZ 85211-4355

John J. McVeigh, Esq.

16230 Falls Road

P.O. Box 128

Butler, MD 21032-0063

Peter Gutmann, Esq.

Womble Carlyle Sandridge & Rice, PLCC

1401 I Street, N.W., Seventh Floor

Washington, D.C. 20005

In re: **KRDE(FM), Globe, Arizona**

Facility ID No. 37577

File No. BALH-20070508ABZ

**Application for Assignment of License**

**Petition to Deny**

Dear Mr. Pelley and Counsel:

We have before us the above-captioned application (the "Assignment
Application") seeking approval for the proposed assignment of the
license for Station KRDE(FM), Globe, Arizona (the "Station"), from Linda
C. Corso ("Corso") to Sunburst Media-KRDE, LLC ("Sunburst"). On June 13,
2007, Douglas Pelley ("Pelley") filed a Petition to Deny the Assignment
Application.[^1] For the reasons stated below, we dismiss the Pelley
pleading as a Petition to Deny, consider and deny it as an informal
objection, and grant the Assignment Application.

**Background.** As described in the pleadings, Pelley is an acquaintance
of Corso's former husband, Rich Potyka ("Potyka"). Although never
formally employed at the Station, Pelley contends that he performed
various maintenance and engineering work at the Station since the
mid-1990's. In 1996, Corso filed a Petition for Divorce in Arizona
court. In January 1997, the Superior Court for the State of Arizona, in
and for Gila County, issued a Decree of Dissolution of Marriage.[^2]
Pelley opposes grant of the Assignment Application based on his claim
that he is still owed compensation for the work done at the Station. He
further argues that Corso neglected to assign the Station's license to
Potyka, as directed by the Arizona court in the Divorce Decree. Pelley
maintains that he and Potyka had a verbal understanding whereby, in lieu
of a salary, the monetary compensation for his services would come from
the proceeds of such a Station sale.[^3]

**Discussion.** *Standing.* Pelley opposes grant of the Assignment
Application based on an alleged monetary debt owed him by the assignor's
former spouse. Section 309(d)(1) of the Communications Act of 1934, as
amended (the "Act"),[^4] provides that only a "party in interest" may
file a petition to deny a proposed assignment. To claim such standing, a
petitioner must allege and prove that grant of the application would
result in, or be reasonably likely to result in, some injury of a
direct, tangible or substantial nature.[^5] The petitioner must also
demonstrate a causal link between the claimed injury and the challenged
action.[^6] In this regard, Pelley fails to "plead 'injury in fact'
traceable to the conduct complained of and likely to be redressed by the
requested relief."[^7] We agree with Sunburst when it states that the
relief Pelley "seeks from the Commission \-- denial of the subject
license assignment \-- would have no impact upon the sole remedy he
claims to deserve \-- his desire to obtain monetary payment from
\[Corso's ex-husband\]."[^8] Pelley's dispute over the claim for payment
is simply insufficient to confer standing.

We additionally note that the Commission may also accord party in
interest status to a petitioner who demonstrates either that he resides
in the service area of the station that is the subject of the petition
or that he listens to or views the station regularly and that such
listening or viewing is not the result of transient contacts with the
station.[^9] Pelley fails to establish listener/residence status as a
basis for standing. Finally, a petitioner must provide an affidavit or
declaration that establishes standing.[^10] Pelley fails to provide such
an affidavit or declaration.

Accordingly, Pelley has not met the statutory standard for standing set
forth in Section 309(d) of the Act, and his pleading will be dismissed
as a petition to deny. We will, however, treat and consider the pleading
as an informal objection pursuant to Section 73.3587 of the Commission's
Rules (the "Rules").[^11] []{.mark}

*Private Contractual Claim.* Pelley's request for compensation for
engineering services rendered at the Station relates to contractual
claims that constitute a private controversy. The Commission has
consistently held that it is not the proper forum for the resolution of
such private disputes, and that the parties should seek redress for such
matters in courts of competent jurisdiction.[^12]

Further, Pelley has not provided evidence of an injunction or a stay
issued by a court[^13] against the proposed sale. In the absence of such
a court order, the Commission has routinely acted favorably on license
assignment applications. We note, however, that Commission grant of an
assignment application merely finds that the parties are qualified
under, and the proposed transaction does not violate the Act, the Rules,
and Commission policies. As such, it is permissive only and does not
prejudice any relief to which the parties may ultimately be entitled.

*Marital Property Issue.* In addition to his private contractual claim,
Pelley contends that Corso failed to seek Commission consent for
assignment of the Station's license to Potyka. In support, Pelley
provides a copy of the January 3, 1997, Divorce Decree,[^14] and argues
that the Divorce Decree awards the Station's license to Potyka.[^15]

Corso responds that she was never legally compelled to sell the Station
to Potyka. She explains that, as a marital property settlement, "the
\[Divorce\] Decree was not self-executing other than with respect to the
marriage. It was necessary for \[Potyka\] and \[Corso\] to actually
implement the division of community property, if that division was to be
followed."[^16] Accordingly, Corso asserts, she and Potyka "were legally
free, after the divorce, to mutually agree to alter the distribution of
assets."[^17] Corso states that, after "emotions cooled"[^18] following
the issuance of the Divorce Decree, she and Potyka "independently
realized that assignment of the license was in neither's interest."[^19]
Therefore, Corso states, she and Potyka "verbally agreed"[^20] that the
license and control of the Station "would remain with \[Corso\] until
such time as the Station was sold to a third party."[^21] As recounted
in Corso's sworn declaration, this "oral agreement superseded the
Divorce Decree with respect to the license."[^22]

We find no merit to Pelley's argument on the issue. To the extent Pelley
challenges compliance with the Divorce Decree, that too is a matter for
state court resolution. Contrary to Pelley's contention, these
circumstances offend no Commission Rule or policy. The judge issued the
Divorce Decree, awarding the assets of the marital estate to the
parties, consistent with the wishes of the parties as expressed in an
informal property settlement agreement that the parties had submitted to
the court.[^23] Thus, the Divorce Decree embodied the parties' agreement
concerning the division of the community property. To the extent that
Pelley argues that the parties subsequent oral agreement violated the
terms of the Divorce Decree, the Commission is not the proper forum to
resolve this issue.

*Proceeds of Sale issue*. We further find that the record disproves
Pelley's inference that an unauthorized transfer of control has
occurred. First, Corso affirms that she has at all times maintained
control over the Station operations. Since the issuance of the Divorce
Decree, she attests that she "continued to closely monitor and to
maintain my control of the Station's operations, and to satisfy all of
the requirements associated with being a Commission Licensee."[^24]
Corso confirms that she has continued to exercise control "over what
programming the Station aired"[^25] and "who worked at the
Station."[^26] Corso also asserts that, as stated in the SOP, "I would
retain absolute control over the License, and there would be no transfer
of control (*de facto* or otherwise) of the Station License or its
operations."[^27]

While Corso held the license as an individual, she acknowledges in her
sworn Declaration that during the marriage capital contributions had
been made by her former husband at approximately 60 percent. Corso also
reports that Potyka assisted with engineering and technical support, as
circumstances required, and that initial purchases of broadcasting
equipment and construction costs were paid from a joint account. Corso
clarifies in Annex III to the Opposition that the parties' intent was
not to cause the conveyance of any interest in the authorizations issued
by the Commission for the Station. Rather, "their intent was to
establish a right of Richard Potyka to a 60% share of the value accorded
to those FCC authorizations in the event of assignment thereof related
to the sale of the Station."[^28] The Corso Declaration confirms that
intent.[^29] Furthermore, there is no indication that Potyka had any
direct ownership interest in the Station. Nor has Potyka held himself
out as a principal or sought to exercise control over the affairs of the
Station or the Station assets.

In light of Corso's sworn declarations that she retained control of the
Station's operations, and that Potyka's interest in the Station license
was always understood by Corso and Potyka to be limited to an interest
of the proceeds derived from an assignment of the Station license to a
third party, we find that Corso did not violate the Rules or the Act by
maintaining the Station license in her name, rather than seeking to
assign the Station license to Potyka. Moreover, contrary to Pelley's
argument, Potyka's claim to a share of the proceeds of the proposed sale
of the Station does not establish that an unauthorized transfer of
control has occurred or suggest that he is an undisclosed
real-party-in-interest. We find, however, that the SOP and BOA
constitute documents required to be filed with the Commission under
Section 73.3613 of the Rules.[^30] Corso failed to do so. Therefore, we
caution Corso to exercise diligence in the future to fully comply with
all Commission requirements.

**Conclusion/Actions**. Based on the above, we find that Pelley has not
raised a substantial and material question of fact warranting further
inquiry. We further find that Sunburst is qualified to hold the Station
KRDE(FM) license and that grant of the Assignment Application is
consistent with the public interest, convenience and necessity.
Accordingly, IT IS ORDERED, that the Petition to Deny filed by Douglas
Pelley IS DISMISSED, and, when treated as an informal objection, IS
DENIED, and that the application for

approval to assign the license for Station KRDE(FM), Globe, Arizona
(File No. BALH-20070508ABZ) from Linda C. Corso to Sunburst Media-KRDE,
LLC IS GRANTED.

Sincerely,

Peter H. Doyle

Chief, Audio Division

Media Bureau

Cc: J. Dominic Monahan, Esq.

[^1]: Corso filed an Opposition to Petition to Deny on June 27, 2007,
    and Sunburst filed an Opposition of Sunburst Media-KRDE, LLC to
    Petition to Deny on June 27, 2007. On August 13, 2007, Pelley filed
    a Comment in Response to Opposition to Petition to Deny ("Comment").
    On September 27, 2007, Corso filed a Motion for Leave to File
    Response, which included a Response to Comment to Opposition to
    "Petition to Deny" ("Response to Comment").

[^2]: *In Re the Marriage of Linda Carol Potyka and Richard Louis
    Potyka*, Decree of Dissolution of Marriage, Superior Court of the
    State of Arizona, in and for Gila County, No. DO 96-215, January 3,
    1997 ("Divorce Decree").

[^3]: Petition to Deny at 2.

[^4]: 47 U.S.C. § 309(d)(1).

[^5]: *See, e.g., Telesis Corp.*, Memorandum Opinion and Order, 68 FCC
    2d 696 (1978).

[^6]: *See* *Lawrence N. Brandt*, 3 FCC Rcd 4082 (1998); *Sierra Club v.
    Morton*, 405 U.S. 727, 733-4 (1972).

[^7]: *Conn-2 RSA Partnership*, Memorandum Opinion and Order, 9 FCC Rcd
    3295, 3297 (1994) (*quoting Orange Park Florida T.V., Inc. v. FCC*,
    811 F.2d 664, 670 (D.C. Cir. 1987)).

[^8]: Sunburst Opposition at 3. Sunburst also notes that Pelley's claims
    involve no party to the application itself, but rather, merely
    allege a monetary debt of a former spouse.

[^9]: *See CHET-5 Broadcasting of Poughkeepsie, Inc.*, Memorandum
    Opinion and Order, 14 FCC Rcd 13041 (1999).

[^10]: *See Petition for Rulemaking to Establish Standards for
    Determining the Standing of a Party to Petition to Deny a Broadcast
    Application*, Memorandum Opinion and Order, 82 FCC 2d 89 (1980);
    *see also Infinity Broadcasting Corp. of California,* Memorandum
    Opinion and Order, 10 FCC Rcd 9504 (1995); *Niles Broadcasting
    Company*, Memorandum Opinion and Order, 7 FCC Rcd 5959 (1992).

[^11]: 47 C.F.R. § 73.3587.

[^12]: *See John F. Runner, Receiver (KBIF)*, Memorandum Opinion and
    Order, 36 RR 2d 773, 778 (1976); *Decatur Telecasting, Inc*.,
    Memorandum Opinion and Order, 7 FCC Rcd 8622 (1992).

[^13]: We note that the Response to Comment provides, at Exhibit D, a
    copy of a complaint filed by Pelley instituting a civil action in
    Arizona court against, *inter alia*, Corso and Potyka. *See Douglas
    Pelley v. Linda Corso et al.*, Superior Court of the State of
    Arizona, in and for Gila County, No. CV 2007-250, Sep. 6, 2007.

[^14]: *See* Comment, Exhibit 1; Response to Comment, Exhibit A. *See
    also supra* note 2.

[^15]: Pelley cites two other documents in support of his allegation.
    The first is a June 1, 2002, Statement of Purpose ("SOP") for
    Tri-Media Incorporated ("TMI"). *See* Comment, Exhibit 2; Corso
    Opposition, Exhibit C, Annex 1. Corso explains that TMI owns the
    Station's "hard assets" and will assign these assets pursuant to the
    Assignment Application. Corso Opposition at 5. The second is a
    November 4, 2005, Business Organization Agreement ("BOA") between
    Corso and Potyka, which addresses the ownership of the Station.
    *See* Comment, Exhibit 3; Corso Opposition, Exhibit C, Annex II.

[^16]: Response to Comment at 5.

[^17]: *Id*.

[^18]: *Id.*

[^19]: *Id.*

[^20]: *Id.* at 6.

[^21]: *Id.*

[^22]: *Id.* at 8. Pursuant to her agreement with Potyka, Corso
    explains, "\[Potyka\] will be entitled to a portion of the sale
    proceeds that correspond to the parties' valuation of the Station
    License." Corso Opposition at 6.

[^23]: *See* Response to Comment, Exhibit A at 3^rd^ unnumbered page.

[^24]: Corso Opposition, Exhibit C at 3.

[^25]: Corso Opposition at 8.

[^26]: *Id.*

[^27]: Corso Opposition*,* Exhibit C at 4. Corso further states that she
    holds the Station license as an individual and "TMI provides support
    services to \[Corso\], including the sale of spots for \[Corso's\]
    and TMI's benefit." Corso Opposition at 6. Corso recognizes TMI's
    support role in providing programming at the Station, but declares
    that "I have always had the final say in what airs on the station,
    and I as an individual have signed program-supply agreements for
    satellite-fed programming, contracts for recorded-music royalty
    payments, etc." *Id.*, Exhibit C at 9.

[^28]: Corso Opposition, Annex III. Corso adds that, "\[A\]lthough the
    wording of the \[BOA\] could lead one to think that \[Potyka\] had
    acquired a 60% present interest in the FCC Authorizations for the
    Station, the intent of the document was that \[Potyka\] have the
    right to a 60% share of the value accorded to the FCC authorizations
    in the event of any assignment of them attendant to a sale of the
    Station." Corso Opposition, Exhibit C at 5.

[^29]: Corso Opposition, Exhibit C at 1.

[^30]: 47 C.F.R. §73.3613 (requiring licensee to file documents relating
    to changes in present or future ownership or control of licensee).