Charles, R. Naftalin, Esq.

Holland & Knight, LLP

2099 Pennsylvania Avenue, NW

Suite 100

Washington, DC 20006-6801

Robert Lewis Thompson, Esq.

Smithwick & Belendiuk, PC

5028 Wisconsin Avenue, NW

Washington, DC 20016

In Re: WWRR(FM), Scranton, PA

> Fac ID 36508
>
> WYCK(AM), Plains, PA
>
> Fac ID 36836
>
> WICK(AM), Scranton, PA
>
> Fac ID 36489
>
> Application File Nos. BAL/BALH-
>
> 20050707AAU/AAP/AAT

Dear Counsel:

This letter concerns the captioned applications of Lane Broadcasting
Corporation ("LBC"), licensee of WWRR(FM), Scranton, Pennsylvania, LB
Radio Corporation ("LB"), licensee of WYCK(AM), Plains, Pennsylvania,
and Lancom, Inc. ("Lancom"), licensee of WICK(AM), Scranton,
Pennsylvania (collectively, the "Seller") for consent to the assignment
of these station licenses to Bold Gold Media Group ("BGMG"). For the
reasons set forth below, we grant the applications.

**Background**

Douglas V. Lane ("Lane") is the 100 percent shareholder of LB, and the
80 percent shareholder of Lancom and LBC. In March 2005 Lane was
convicted in local Lackawanna County, Pennsylvania, court of several
felony counts involving child molestation and child pornography. Lane
was sentenced to a prison term in October 2005 and is currently
incarcerated. He is appealing his convictions and sentence.

Prior to the execution of an asset purchase agreement, Holt Media Group,
Inc. prepared an independent appraisal of the fair market value of
WWRR(FM), WYCK(AM), and WICK(AM) (collectively, the "Stations"). Under
the terms of the asset purchase agreement, BGMG would pay Seller \$1.925
million, less the total amount of any pre-closing loans made by BGMG to
Seller for the operation of the Stations. The sale proceeds would be
used to pay all taxes due and to satisfy all liabilities relating to the
Stations' assets. The proceeds also would be used to pay all valid and
reasonably documented claims of Seller creditors and to fund a \$100,000
Post-Closing Escrow for potential Seller liabilities relating to the
Stations. A non-refundable \$300,000 payment would be made to the
Lackawanna County General Fund ("LCGF") at closing. No payment would be
made -- directly or indirectly -- to any Seller shareholder. Any
remaining proceeds would be placed in a Post-Closing Trust. If any
felony conviction of Lane is sustained in a final determination, all
funds remaining in the Post-Closing Trust will be distributed to the
LCGF.

A separate agreement, dated October 7, 2005, between Lane and the
District Attorney for Lackawanna County (the "District Attorney"), who
was the prosecuting attorney at the Lane trial, sets forth the
distribution plan for funds paid into the LCGF. The non-refundable
\$300,000 payment would be disbursed to victims of Lane and to
Lackawanna County non-profit agencies which assist abused children. The
residual distribution from the Post-Closing Trust to the LCGF would be
dispersed in a manner directed by the District Attorney.

**Discussion**

The *Jefferson Radio* policy precludes consideration of license
assignment applications where a character issue has been resolved
against the seller or is pending.[^1] This is because, as the Commission
explained in one case, "there is no authorization to assign" if the
seller ultimately is found unqualified.[^2] The policy's underlying
purpose is to prevent licensees from evading responsibility for
wrongdoing.[^3] The policy serves as a deterrent because of the
potential for "awesome loss" that would result from revocation or
non-renewal of license.[^4] This deterrent effect would be undermined if
a licensee could "sell out from under a potential disqualification."[^5]

Under the Commission's *Character Qualifications Policy Statement,*[^6]
a licensee's character may be put in issue with non-FCC misconduct. In
the *1986 Character Policy Statement* the Commission stated that "there
may be circumstances in which an applicant has engaged in nonbroadcast
misconduct so egregious as to shock the conscience and evoke almost
universal disapprobation . . . . Such misconduct might, of its own
nature, constitute *prima facie* evidence that the applicant lacks the
traits of reliability and/or truthfulness necessary to be a licensee . .
. ."[^7] The *1990 Character Policy Statement* substantially expanded
the scope of relevant non-FCC misconduct. In that Statement, the
Commission concluded that a licensee's propensity to comply with the law
generally is relevant to the Commission's public interest analysis and
that evidence of any felony conviction, not just those that involve
fraud or untruthfulness, is pertinent to its evaluation of a licensee's
character.[^8] More recently, the Commission concluded that a conviction
involving repeated sexual abuse of children constitutes an independent
basis for disqualification.[^9] For the same reasons, we conclude that
Lane's convictions raise a substantial and material question of fact as
to whether he possesses the requisite qualifications to remain a
Commission licensee.

In rare circumstances, the Commission has exempted sellers from
application of the *Jefferson Radio* policy based on compelling public
interest considerations. We conclude that the extraordinary terms for
the sale of the Stations permit the grant of these applications,
consistent with prior precedent. Most importantly, no shareholder will
receive any direct benefit from the sale of the Stations. The District
Attorney's continued oversight of the distribution of sale proceeds will
ensure strict compliance with this requirement. The denial of proceeds
to shareholders imposes an economic result similar to the "awesome loss"
which results from revocation. Thus, grant of the applications will not
lessen the *Jefferson Radio* policy's broad deterrent effect on
wrongdoing. This contract term is substantially harsher than that
approved in *Harry O'Connor,* a case involving an alleged unauthorized
transfer of control and misrepresentation to the Commission.[^10] In
*O'Connor,* the Commission concluded that grant of the assignment
application was warranted because the seller would receive substantially
less than he paid for his interest in the licensee entity.[^11]

Other public interest factors which the Commission has relied on
previously also are present here. Grant of the applications will result
in Lane's full withdrawal from broadcasting[^12] and will ensure the
Stations' continuous service to listeners in the Scranton area.[^13] The
Commission also has long recognized the protection of creditors and lien
holders as a public interest benefit.[^14] The claims of these innocent
parties, including the United States, will be fully satisfied out of
sale proceeds. We emphasize, however, that this factor is not a primary
basis for our action.

Finally, we find compelling the fact that a significant portion of the
sale proceeds will be distributed directly to victims of Lane and to
programs which provide services to abused children. This creative
approach, which the District Attorney and officials at the local and
federal levels strongly support, promises significant relief to Lane's
victims and benefits to the residents of Lackawanna County. We conclude
that it is appropriate to exercise our discretion not to pursue further
the issue of Mr. Lane's qualifications and to approve the subject
assignment applications.

ACCORDINGLY, IT IS ORDERED, That the applications (File Nos.
BALH-20050707AAU, BAL-20050707AAP, and BAL-20050707AAT) to assign the
licenses of stations WWRR(FM), Scranton, Pennsylvania, WYCK(AM), Plains,
Pennsylvania, and WICL(AM), Scranton, Pennsylvania from Lane
Broadcasting Corporation, LB Radio Corporation, and Lancom, Inc.,
respectively, to Bold Gold Media Group ARE GRANTED subject to the
conditions that (1) Douglas V. Lane shall not in the future acquire an
attributable interest in any Commission licensee or permittee without
advance notice and a full showing of his qualifications to the
Commission; (2) should Douglas V. Lane hold or acquire an attributable
interest in any applicant for a Commission authorization, he must submit
a full showing of his qualifications and a copy of this letter decision
with the application; and (3) that the proceeds from the sale of the
subject stations be distributed as set forth in the captioned
applications, as amended.

Sincerely,

Peter H. Doyle

Chief, Audio Division

Media Bureau

cc: Howard J. Braun, Esq.

[^1]: *See Jefferson Radio Corp. v. FCC,* 340 F.2d 781 (D.C. Cir. 1964).

[^2]: *Catherine C. Murphy,* 42 FCC 2d 364, at ¶ 5 (1973).

[^3]: *See, e.g., Harry O'Connor,* 2 FCC 2d at ¶ 8 (1965) ("The purpose
    underlying this policy is obvious: A licensee cannot act
    inconsistently with the Communications Act or the Commission's rules
    and policies, and then, when a question is raised concerning such
    improper activity, transfer or assign the license to another; if he
    could, the only result of the wrongdoing would be a forced sale.").

[^4]: *See Stereo Broadcasters, Inc. v. FCC,* 652 F.2d 1026, 1030 (D.C.
    Cir. 1981).

[^5]: *See Cellular System One of Tulsa, Inc.,* 102 FCC 2d 86, at ¶ 7
    (1985) ("To permit a licensee to sell out from under a potential
    disqualification would significantly impair the Commission's ability
    to police and deter licensee misconduct."), citing *Pass Word,
    Inc.,* 76 FCC 2d 465, 516 (1980), *modified,* 86 FCC 2d 437 (1981),
    *aff'd sub nom., Pass Word, Inc. v. FCC,* 673 F.2d 1363 (D.C. Cir.
    1982).

[^6]: 102 FCC 2d 1179, *recon. granted in part,* 1 FCC Rcd 421 (1986)
    ("*1986 Character Policy Statement*"), *modified,* 5 FCC Rcd 3252
    (1990) ("*1990 Character Policy Statement"*), *on reconsideration,*
    6 FCC Rcd 3448 (1991), *modified in part,* 7 FCC Rcd 6564 (1992).

[^7]: *1986 Character Policy Statement* at 1205 n.60.

[^8]: *199*0 *Character Policy Statement,* 5 FCC Rcd at 3252.

[^9]: *Contemporary Media, Inc.,* 13 FCC Rcd 14437, 14446 (1998)

[^10]: *Harry O'Connor,* 2 FCC 2d 45 (1965).

[^11]: *Id.* at ¶ 10.

[^12]: *See Radio San Juan, Inc.,* 45 FCC 2d 375, 376 (1974); *see also,
    Northwestern Indiana Broadcasting Corp.,* 65 FCC 2d 66, 70 (1977).

[^13]: *Harry O'Connor,* 2 FCC 2d at ¶ 10; *see also, Spanish Int'l
    Comm'ns Corp..,* 2 FCC Rcd 3336, 3339 (1987), *rev'd sub nom.
    Coalition for the Preservation of Spanish Broad. V. FCC,* 893 F.2d
    1349, 1362 (D.C. Cir 1990), *vacated and aff'd,* 931 F.2d 73 (D.C.
    Cir) (en banc), *cert. denied,* 502 U.S. 907 (1991).

[^14]: *See LaRose v. FCC,* 494 F.2d 1145, 1146 n.2, 1148 (D.C. Cir
    1974), *Dale J. Parsons, Jr.,* 10 FCC Rcd 2718, 2720 (1995), and
    *Shell Broadcasting, Inc.,* 38 FCC 2d 929, 931 (1973).