**DA 06- 2607**

In Reply Refer To*:*

1800B3-ALV

Released: December 28, 2006

David A. Schum

DFW Radio License, LLC

P.O. Box 12345

Dallas, TX 75225-0345

Daniel B. Zwirn

Bernard Dallas LLC

745 Fifth Avenue

18^th^ Floor

New York, NY 10151

Re: KFCD(AM), Farmersville, TX

Facility ID No. 43757

File No. BAL-20060117ACU

KHSE(AM), Wylie, TX

Facility ID No. 133464

File No. BAP-20060117ACV

Application for Assignment of Licenses

Dear Applicants:

We have before us the above-captioned application (the "Assignment
Application") proposing to assign the license of Station KFCD(AM),
Farmersville, Texas, and the construction permit of Station KHSE(AM),
Wylie, Texas, from DFW Radio License, LLC ("DFW Radio") to Bernard
Dallas LLC ("Bernard"). We also have before us a Petition to Deny
("Petition"), filed February 23, 2006, by nine investors in Stations
KFCD(AM) and KHSE(AM) (the "Petitioners").[^1] For the reasons stated
below, we deny the Petition and grant the Assignment Application.

**Background**

On February 5, 2004, The Watch, Ltd. ("Watch"), the former licensee of
KFCD(AM) and permittee of KHSD(AM), and D.B. Zwirn Special Opportunities
Fund, L.P. ("DBZ") entered into a Financing Agreement (the "Agreement")
whereby DBZ provided a loan to Watch to facilitate Watch's emergence
from Chapter 11 bankruptcy,[^2] operation of KFCD(AM), and construction
of KHSE(AM). The Agreement also provided for the assignment of the
KFCD(AM) license and KHSE(AM) permit to DFW Radio, a wholly-owned
subsidiary of Watch.[^3]

In the spring of 2005, DBZ notified Watch and DFW Radio (Watch and DFW
Radio, collectively, the "Debtors") that they were in default under the
Agreement and demanded full payment of all obligations.[^4]
Subsequently, on May 25, 2005, DBZ filed for the appointment of a
receiver in the U.S. Bankruptcy Court for the Northern District of
Texas, Dallas Division (the "Court").[^5] The Debtors simultaneously
filed for relief and reorganization under Chapter 11 of the Bankruptcy
Code.[^6] On May 27, 2005, DBZ filed a motion to appoint a Chapter 11
trustee for the bankrupt companies or, in the alternative, to convert
the case to a Chapter 7 liquidation ("Chapter 11 Motion").

The Debtors and DBZ subsequently agreed to resolve the Chapter 11 Motion
on the following terms and conditions, memorialized by a June 23, 2005,
Order of the Court:[^7] (1) the Debtors were authorized to obtain
additional financing from DBZ to construct KHSE(AM);[^8] (2) the loan
proceeds were to be "advanced to or as directed by W. Lawrence Patrick
\["Patrick"\], the Debtors' proposed Media Broker";[^9] (3) Patrick was
authorized to supervise construction, employ a superintendent of
construction, and market KFCD(AM) and KHSE(AM) for sale;[^10] and (4)
prior to September 20, 2005, David A. Schum ("Schum"), the sole manager
of DFW Radio and one of the Petitioners, was allowed to seek third-party
refinancing and thus halt the sales process.[^11]

Schum was unable to obtain third-party refinancing, and the Court
mandated that the Debtors' assets be sold at a public auction. At the
October 13, 2005, public auction, the Debtors received bids from six
separate bidders. Attorneys for the Debtors designated DBZ as the
successful bidder with its highest credit bid, and on December 5, 2005,
the Court reviewed the marketing and sales procedures and approved the
sale of the Debtors' assets to DBZ.[^12] DBZ subsequently assigned its
purchase rights to Bernard, its newly-formed affiliate, and on January
17, 2006, the parties filed the subject application seeking Commission
consent to assign the license for KFCD(AM) and the permit for KHSE(AM)
from DFW Radio to Bernard.

The Petitioners object to the grant of the Assignment Application on
four grounds. First, the Petitioners allege that the auction sale to DBZ
amounts to "the attempted sanctioning of a reversionary interest"[^13]
in violation of Section 73.1150 of the Commission's Rules (the
"Rules").[^14] Second, the Petitioners contend that DBZ prematurely
assumed control of the construction of KHSE(AM) in violation of Section
310(d) of the Communications Act of 1934, as amended (the "Act").[^15]
Third, the Petitioners assert that DBZ threatened Schum with legal
action when Schum attempted to exercise control over the KHSE(AM)
construction, and thus abused the Commission's processes. Finally, the
Petitioners state that Bernard failed to disclose fully the ownership
information of DBZ, its principal equity owner, and that DBZ may not
comply with the Commission's foreign ownership limitations.[^16]

**Discussion**

***Standing.*** Petitioners are nine equity owners of Watch, the parent
company of DFW Radio. Petitioners claim standing to file the Petition
based upon their assertions that: (1) the majority of the Petitioners
live in the primary service areas of Stations KFCD(AM) and KHSE(AM) and
have been, or will be, listeners of the stations; and (2) all of the
Petitioners will lose their investments in the stations and suffer
"severe economic harm" if the Commission grants the Assignment
Application.[^17] Bernard counters that the Petitioners lack standing,
and the Petition should be denied, because: (1) the Petitioners make no
claim regarding programming on KFCD(AM) and "cannot possibly be
listeners of KHSE -- a just-constructed station that ... is still
awaiting a grant of program test authority";[^18] and (2) Petitioners
have not shown how denying the Assignment Application would prevent the
alleged economic harm from occurring.[^19]

When challenging an application pursuant to Section 309(d)(1) of the
Act,[^20] a petitioner must demonstrate party-in-interest status. The
Commission accords party-in-interest status to a petitioner who
demonstrates *either* (1) residence in the station's service area, *or*
(2) that he/she listens to or views the station regularly, and that such
listening or viewing is not the result of transient contacts with the
station.[^21] Petitioners have satisfied this standard by submitting
declarations, under penalty of perjury, certifying that the majority of
Petitioners reside within the stations' primary service areas, and
therefore we find that they have sufficiently demonstrated
party-in-interest status under Section 309(d). Accordingly, we need not
consider Petitioners' further claim of standing based on economic harm.

***Reversionary Interest.*** The Petitioners assert that through the
auction sale, "a creditor \[DBZ\], who had no right to a lien or a
hypothecation of a Commission license, got a non-expert judicial officer
to obtain for it what the law would not allow -- a reversionary interest
in the KFCD license and KHSE construction permit."[^22] The auction
sale, Petitioners aver, is inconsistent with the D.C. Circuit's recent
decision in *Kidd Communications* ("*Kidd*")*,*[^23] and the Assignment
Application must therefore be denied. Bernard counters that the
Petitioners' reliance on *Kidd* is misplaced, and the Assignment
Application does not implicate the Commission's policy prohibiting a
license holder from granting a security interest in a broadcast license
and Section 73.1150 of the Rules, which prohibits a seller from
retaining a reversionary interest in a station license.[^24] We agree
with Bernard and reject Petitioners' allegation.

Specifically, the agreements for DBZ's debt financing to DFW Radio and
Watch do not provide DBZ a security interest in the stations' FCC
license and permit, but, in fact, explicitly exclude the authorizations
from the secured collateral.[^25] Moreover, DBZ is not a former licensee
of the stations, re-acquiring the stations through a reversionary
interest. Rather, DBZ was the highest bidder at a court-ordered and
supervised public auction, open to all interested bidders. The Court
subsequently mandated the sale to DBZ, finding that it was in the best
interests of the Debtor, the Debtors' estates, their creditors, and
interest holders.[^26]

It is well-established that the Commission will accommodate court
decrees unless a public interest determination under the Act compels a
different result.[^27] Accommodation of the Court's Order contravenes
neither the Act nor the Rules, including Section 73.1150. Accordingly,
we find no reason not to honor the Court's Order and grant the
Assignment Application.[^28]

***Premature Assumption of Control.*** The Petitioners further allege
that DBZ usurped control over the construction of KHSE(AM) and "froze
DFW Radio out of any decision making, or even consent, to actions being
taken relative to KHSE."[^29] Bernard counters that DBZ did not assume
unauthorized control of KHSE(AM), but rather acted within the scope of
the Court-ordered and supervised process for construction.

In ascertaining whether a prohibited transfer of control has occurred,
we have traditionally looked beyond legal title to see whether a new
entity or individual has obtained the right to determine basic operating
policies of the station.[^30] Although a licensee or permittee may
delegate certain functions on a day-to-day basis, the ultimate
responsibility for essential station operations, such as personnel,
programming, and finances, is non-delegable.[^31]

On their face, the Court Orders regarding the construction of KHSE(AM),
as well as the subsequent agreements between DFW Radio and DBZ, comport
with Commission policy. The Orders and agreements provide that DBZ will
advance the funds for construction and that Patrick, the media broker
for DFW Radio, will oversee the station's construction. The terms of the
agreements, however, confirm that ultimate control over construction
will remain with DFW Radio. Specifically, pursuant to the June 23, 2005,
Order, agreed to by DFW Radio, Patrick was delegated authority to
supervise construction, select a construction superintendent, and
utilize the loan proceeds to pay for construction.[^32] The Court Orders
and subsequent agreements between the parties, however, were also
explicit that the "construction contract, the budget for such
construction, and all other terms and documents thereto shall be in all
respects satisfactory to the Debtors \[DFW Radio and Watch\]"[^33] and
that "Zwirn \[DBZ\] shall not

be deemed to be in control of the Debtors, the operation of the Debtors,
or to be acting as a responsible person with respect to the operation or
management of the Debtors and their assets for any purpose."[^34]

The Petitioners aver that DBZ did not abide by these terms, but rather
"pushed DFW Radio aside with respect to control of KHSE" and directed
Patrick and Jack Sellmeyer ("Sellmeyer"), the construction
superintendent, "not to communicate with nor involve DFW Radio in any
aspects of the construction of KHSE."[^35] The Petitioners, however,
fail to present probative evidence in support of their claim that
Petitioner Schum, the manager of DFW Radio, was "blocked from any input
in the build out of KHSE \[and\]... was never in the information loop
although Mr. Patrick gave almost daily reports to Zwirn."[^36] Indeed,
Bernard presents evidence showing that Schum was regularly apprised of
the construction of KHSE(AM), receiving calendars of the construction
timeline, frequent e-mail updates, and progress reports.[^37] Further,
while the Petitioners allege that Sellmeyer and DBZ attempted to
unilaterally modify the KHSE(AM) construction permit, the Petitioners
acknowledge, and the record shows, that DFW Radio exerted its control to
block that effort, and a FCC Form 301 modification application was never
filed.

While it is undisputed that DBZ funded the construction of KHSE(AM) and
received updates from Patrick on the progress of construction,[^38]
there is no evidence that DBZ usurped control over construction, as the
Petitioners allege. Accordingly, we find that Petitioners have not
established a *prima facie* case that DBZ engaged in an unauthorized
transfer of control of KHSE(AM).

***Abuse of Process.*** Petitioners next claim that DBZ abused the
Commission's processes when its counsel threatened Schum with legal
action when he attempted to exercise control over the KHSE(AM)
construction.[^39] Bernard counters that the Court Order prohibited
Schum from hindering, interfering with, or attempting to delay Patrick's
efforts to oversee the construction of KHSE(AM).[^40] Bernard claims
Schum violated the Court Order's provisions by contacting the Federal
Aviation Administration directly and requesting alteration of the
antenna structure registrations associated with the KHSE(AM) towers. In
response, counsel for DBZ sent an e-mail to Schum's counsel expressing
concern about this violation,

stating that actions with respect to construction should be taken
through the debtors' court-appointed professionals.[^41]

Initially with regard to this allegation, it is unclear how the
communication in any way involves, let alone abuses, Commission
processes. Moreover, even were we to consider the September 9, 2005,
e-mail to be tangentially related to Commission processes, we find that
there is nothing objectionable about it. The Commission has stated that
abuse of process is a "broad concept that includes use of Commission
process to achieve a result that the process was not intended to
achieve, or use of that process to subvert the purpose the process was
intended to achieve."[^42] In its Order on character qualifications, the
Commission further defined "abuse of process" as "serious willful
misconduct that directly threatens the integrity of the Commission's
licensing processes."[^43]

We find no merit to the allegation that DBZ was committing an abuse of
the Commission's processes. The e-mail sent by DBZ's counsel was not an
improper threat, but rather a good faith effort to protect DBZ's
financial interest and ensure construction of the station.[^44] DBZ was
acting in accordance with the Court Order, and its actions neither
evidence an improper motive nor subvert Commission processes.
Accordingly, we reject the argument that DBZ's "threat" amounted to an
actionable abuse of Commission processes.

***Foreign Ownership.*** Finally, the Petitioners assert that Bernard
failed to disclose ownership information about DBZ, its principal equity
owner, and there is thus "no way of objectively knowing (other than
taking Zwirn's word for it)"[^45] whether Bernard complies with the
foreign ownership restrictions of Section 310 of the Act.[^46] In its
ownership exhibit to the Assignment Application, Bernard certified that
DBZ, which holds the majority of the equity, but no voting interest, in
Bernard's parent company is "insulated from involvement in the LLC's
media enterprises pursuant to FCC requirements"[^47] and thus exempt
from attribution.[^48] Moreover, Bernard certified in the Assignment
Application that it complies with the alien ownership restrictions and
subsequently submitted a declaration, under penalty of perjury, from
Steven F. Campbell, a Vice President of DBZ, attesting that "\[t\]here
is no direct or indirect foreign equity or voting ownership in Bernard
Dallas LLC. This includes equity investments in D.B. Zwirn Special
Opportunities Fund, L.P., an insulated member of Bernard Dallas's direct
parent."[^49] The Petitioners present no rebuttal evidence, and we thus
reject their speculative foreign ownership allegations.

**Conclusion**

Based on the evidence presented in the record, we find that the
Petitioners have not raised a substantial and material question of fact
warranting further inquiry. We further find that Bernard Dallas LLC is
qualified as an assignee and that grant of the Assignment Application is
consistent with the public interest, convenience, and necessity.[^50]
Accordingly, IT IS ORDERED, That the application to assign the license
of Station KFCD(AM), Farmersville, Texas (File No. BAL-20060117ACU) and
the construction permit of Station KHSE(AM), Wylie, Texas (File No.
BAP-20060117ACV) from DFW Radio License, LLC to Bernard Dallas LLC, IS
GRANTED, subject to the condition that the KFCD(AM) transaction may not
be consummated prior to the grant of the pending license renewal
application for KFCD(AM). IT IS FURTHER ORDERED, That the February 23,
2006, Petition to Deny filed by David A. Schum et al. IS DENIED.

Sincerely,

Peter H. Doyle

> Chief, Audio Division
>
> Media Bureau

cc: Dennis J. Kelly, Esq.

Gregory L. Masters, Esq.

[^1]: Petitioners are David A. Schum, J. Michael Lloyd, Frank D.
    Timmons, Carol D. Kratville, Brian M. Brown, Robert E. Howard, Edwin
    E. Wodka, John W. Saunders, and Richard J. Drendel. Bernard filed an
    Opposition to the Petition on March 8, 2006, to which the
    Petitioners filed a Reply on March 16, 2006.

[^2]: *See In re Renaissance Radio, Inc.*, Case No. 03-33479-BJH-11.
    Renaissance Radio, Inc. ("Renaissance") is the former owner of
    KFCD(AM) and KHSE(AM). Pursuant to Renaissance's Chapter 11 plan of
    reorganization, the stations were assigned from Renaissance to
    Watch, a newly-formed and commonly-controlled partnership. *See*
    BAL-20031126ATD, ATE (consummated February 5, 2004).

[^3]: On May 17, 2004, the Commission granted an application to assign
    the station authorizations from Watch to DFW Radio. *See*
    BAL-20040305ACG, ACH (consummated June 1, 2004).

[^4]: *See* Petition at 5; Opposition at 3.

[^5]: *See* "Plaintiff's Original Petition and Application for
    Appointment of a Receiver," attached as Exhibit B to Opposition.

[^6]: *See In re The Watch, Ltd, et al.,* Case Nos. 05-35892-BJH-11 and
    05-35874-BJH-11. On January 5, 2006, the Commission granted an
    application to assign the license for KFCD(AM) and the construction
    permit for KHSE(AM) from DFW Radio to DFW Radio License, LLC,
    Debtor-in-Possession. *See* BAL/BAP-20050713ABE, ABF. DFW Radio has
    not yet notified the Commission that the assignment has been
    consummated.

[^7]: *See* "Agreed Order Regarding Emergency Motion to Appoint Chapter
    11 Trustee or, in the Alternative, to Convert Case to Chapter 7,"
    dated June 23, 2005, Case No. 05-35874-BJH (the "June 23, 2005,
    Order"), attached as Exhibit A to Opposition.

[^8]: *Id.* at ¶ 1.

[^9]: *Id.*

[^10]: *Id.* at ¶¶ 1-2.

[^11]: *Id.* at ¶ 4. *See also* Court's July 20, 2005 "Rights Order
    Pursuant to Stalking Horse Designation Procedure and Other Bid
    Procedures," attached as Exhibit E to Opposition.

[^12]: On December 27, 2005, the Court entered its written order
    approving the sale of the assets to DBZ. *See* December 27, 2005,
    Court "Order (A) Approving Sale Free and Clear of Certain Liens,
    Claims, Rights, Interests and Encumbrances to Zwirn Special
    Opportunities Fund, L.P. or Its Designee and (B) Granting Requested
    Relief," attached at Exhibit 10 to Assignment Application (the
    "December 27, 2005, Order").

[^13]: Petition at 6.

[^14]: 47 C.F.R. § 73.1150.

[^15]: 47 U.S.C. § 310(d).

[^16]: *See* 47 U.S.C. § 310(a-b).

[^17]: Petition at 2-3.

[^18]: Opposition at 5.

[^19]: *Id.* at 6. According to Bernard, "were the application denied,
    the Petitioners would not recoup their 'investments'; rather, the
    companies' assets would remain part of the bankruptcy estate and be
    used to satisfy the debts owing to creditors." *Id.*

[^20]: 47 U.S.C. § 309(d).

[^21]: *See Chet-5 Broadcasting, L.P*., Memorandum Opinion and Order, 14
    FCC Rcd 13041 (1999) (modifying the standard set forth in *Maumee
    Valley Broadcasting, Inc.*, Memorandum Opinion and Order, 12 FCC Rcd
    3487 (1997), which had required a petitioner to demonstrate *both*
    residence in the station's service area and that petitioner listens
    to or views the station); *see also Curators of the University of
    Missouri*, Memorandum Opinion and Order and Notice of Apparent
    Liability, 16 FCC Rcd 1174 (2001).

[^22]: Petition at 6.

[^23]: *Kidd Communications v. FCC*, 427 F.3d 1 (D.C. Cir. 2005). In
    *Kidd*, a state court determined that a promissory note, executed
    and defaulted upon by the current licensee of a radio station,
    created a security interest in favor of the former licensee in
    *both* the station's physical assets and FCC license. Accordingly,
    the court ordered that the station's license be assigned to the
    former licensee, and the Commission approved the assignment. The
    D.C. Circuit, however, vacated and remanded the case, holding that
    the Commission failed to adequately explain why its general policy
    on reversionary interests in FCC authorizations did not prohibit the
    transfer.

[^24]: 47 C.F.R. § 73.1150, which provides that a transferor of a
    broadcast station license may retain "no right of reversion of the
    license, no right to reassignment of the license in the future, and
    may not reserve the right to use the facilities of the station for
    any period whatsoever." 47 C.F.R. § 73.1150(a).

[^25]: *See* Objection at Exhibit C, § 2(g); Exhibit D, § 4.1

[^26]: *See* December 27, 2005, Order at 2.

[^27]: *Arecibo Radio Corp.,* Memorandum Opinion and Order, 101 FCC 2d
    545 (1985); *Radio Station WOW, Inc. v. Johnson*, 326 U.S. 120,
    131-32 (1945).

[^28]: *Compare Kirk Merkley, Receiver*, Memorandum Opinion and Order,
    94 FCC 2d 829 (1983), *recon. denied*, Memorandum Opinion and Order,
    56 RR 2d 413 (1984), *aff'd sub nom. Merkley v. FCC*, 776 F.2d 365
    (D.C. Cir. 1985) (holding that an agreement giving a prior licensee,
    as a default remedy, the right to regain control automatically of
    the station and its license, was tantamount to a vested security
    interest and violated Commission policy, and thus departing from the
    court's decision).

[^29]: Petition at 12.

[^30]: *See WHDH, Inc.*, Memorandum Opinion and Order, 17 FCC 2d 856,
    863 (1969), *aff'd sub nom., Greater Boston Television Corp. v.
    FCC*, 444 F.2d 841 (D.C. Cir. 1970), *cert denied*, 403 U.S. 923
    (1971).

[^31]: *See, e.g, WPGR, Inc.,* Memorandum Opinion and Order, 10 FCC Rcd
    8140, 8145 (1995); *Southwest Texas Public Broadcasting Council*,
    Letter, 85 FCC 2d 713, 715 (1981).

[^32]: As a debtor-in-possession, DFW Radio was operating under
    supervision of the Court. The Court-ordered process for construction
    was intended to ensure the construction and activation of a new AM
    broadcast station.

[^33]: June 23, 2005, Order at 1; *see also* Asset Purchase Agreement
    ("APA") at 1, attached as Exhibit 10 to Assignment Application ("The
    construction of Station 700 AM shall be managed by Larry Patrick ...
    acting on behalf of the Seller and by such authority having Seller's
    ultimate control and supervision prior to the Final Closing").

[^34]: *See* July 20, 2005, "Final Order Authorizing Postpetition,
    Secured, Superpriority Financing" at 8; *see also* Section 5.2 of
    APA ("Prior to the Final Closing Date, Buyer shall not, directly or
    indirectly, control, supervise, direct, or attempt to control,
    supervise, or direct the operation of the Stations and all such
    operation, including complete control and supervision of all of the
    Station's programs, employees, and policies shall be the sole
    responsibility of Seller until the Final Closing Date ...").

[^35]: Petition at 7-8.

[^36]: Reply at 6.

[^37]: *See* Exhibit I to Opposition.

[^38]: The Commission has permitted prospective purchasers to furnish
    funds and act in varying management capacities in order to assure
    continuance of service. *See, e.g., Daniel Forrestall*, *Receiver*,
    Memorandum Opinion and Order, 8 FCC Rcd 884 (MMB 1993); *see also
    Choctaw Broadcasting Corporation,* Memorandum Opinion and Order, 12
    FCC Rcd 8534 (1997) (advancement of funds by prospective purchaser
    for station construction did not evidence control of station
    finances).

[^39]: Petition at 13. According to Petitioners, "not only was this
    threat sleazy in the extreme, the threat violated established case
    law, and must expose the party on whose behalf the threats were made
    as *prima facie* unqualified to be a Commission license."

[^40]: *See* Exhibit A to Opposition at 3 ("Neither David A. Schum nor
    any other insider of the Debtors shall in any way interfere, hinder,
    or attempt to delay Mr. Patrick's activities with respect to the
    funds so advanced by Zwirn and the construction activities related
    to station AM 700").

[^41]: *See* Exhibit J to Opposition. The September 9, 2005, e-mail,
    from counsel for DBZ to counsel for Watch, reads as follows:

    > Although having Schum's input on certain matters is helpful, I
    > don't believe it is appropriate for him to contact the FAA, the
    > FCC, or any other agency directly. The Debtors need to take
    > actions through their court-appointed representatives. If Schum
    > feels that communication is necessary, he needs to come through
    > you . . . This type of direct communication is not appropriate and
    > is in direct violation of the Court's Order. Please let Dave know
    > that this type of conduct is improper, and that future violations
    > will be addressed with the Court.

[^42]: *See In The Matter of Saga Communications of New England, Inc.*,
    Notice of Apparent Liability, 19 FCC Rcd 2741 (EB 2004); *Ronald
    Brasher*, Order to Show Cause, Hearing Designation Order, and Notice
    of Opportunity for Hearing, 15 FCC Rcd 16326, 16331 (2000) (citing
    *Broadcast Renewal Applicants*, Second Further Notice of Inquiry and
    Notice of Proposed Rule Making, 3 FCC Rcd 5179, 5199 n.2 (1988)).

[^43]: *See Policy Regarding Character Qualifications in Broadcast
    Licensing*, Report, Order, and Policy Statement, 102 FCC 2d 1179,
    1211 (1986).

[^44]: *See Fort Collins Broadcasting Co., Inc.*, Memorandum Opinion and
    Order, 38 FCC 2d 707, 711-12 (1972) (Commission found that the
    licensee was not committing an abuse of process, but was simply
    "acting like any other potential litigant \[who\] believed in good
    faith that it could advise \[petitioner\] that it might file suit").

[^45]: Reply at ii.

[^46]: 47 U.S.C. § 310(a-b).

[^47]: *See* Assignment Application at Attachment 11. According to
    Bernard, the LLC agreement of its parent company, Bernard Radio LLC,
    contains provisions insulating DBZ from involvement in media-related
    activities.

[^48]: *See* 47 C.F.R. § 73.3555, Note 2(f)(1) ("An interest in a LLC
    shall be attributed to the interest holder unless that interest
    holder is not materially involved, directly or indirectly, in the
    management or operation of the media-related activities of the
    partnership and the licensee or system so certifies"). Bernard
    supplied the requisite certification regarding the insulation of
    DBZ.

[^49]: *See* Exhibit K to Opposition.

[^50]: Petitioners have advised that Schum has appealed the result of
    the auction in a Texas state court. Accordingly, we emphasize that
    our decision to grant the Assignment Application merely finds that
    the parties are qualified under, and the proposed transactions do
    not violate, the Communications Act of 1934, as amended, and the
    Commission's rules and policies. As such, it is permissive only and
    does not prejudice the outcome of the court proceeding and any
    relief to which the parties are entitled under the civil suit.