Before the

**Federal Communications Commission**

**Washington, D.C. 20554**

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| In the Matter of                      | * | EB Docket No. 01-39       |
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| FAMILY BROADCASTING, INC.             | ) |                           |
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| Order to Show Cause Why the Licenses  | * |                           |
| for                                   |   |                           |
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| Stations WSTX(AM) and WSTX-FM,        | * |                           |
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| Christiansted, U.S. Virgin Islands,   | * |                           |
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| Should Not Be Revoked                 |   |                           |
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**SUMMARY DECISION**

**OF**

ADMINISTRATIVE LAW JUDGE RICHARD L. SIPPEL

**Issued:** August 3, 2001 **Released:** August 7, 2001

PRELIMINARY STATEMENT

1.  This hearing was commenced by Order to Show Cause and Notice of
    Opportunity for Hearing ("OSC") adopted by the Commission on
    February 8, 2001, and published at 16 F.C.C. Rcd 4330 (2001). On
    March 15, 2001, Family filed a Petition for Reconsideration asking
    that the OSC be set aside and that Family be afforded a reasonable
    opportunity to correct deficiencies specified in the OSC. In
    [Order]{.underline} FCC 01-188, released June 15, 2001, the
    Commission rejected Family's request and dismissed the petition.

**Cross Motions for Summary Decision**

2.  This is a ruling on Cross Motions for Summary Decision filed on July
    10, 2001, by Family Broadcasting, Inc. ("Family") and the
    Enforcement Bureau ("Bureau"). [Order]{.underline} FCC

01M-14, released May 30, 2001. Opposition briefs were filed on July 30,
2001. [Order]{.underline} FCC 01M-22, released July 18, 2001. The issues
concern revocation and forfeiture.

# 

**Issues**

3.  The issues set in the OSC are the following:

> A. To determine whether Family Broadcasting, Inc. misrepresented facts
> to and/or lacked candor with the Commission in its statements
> regarding the relocation of WSTX-FM's transmitter from its authorized
> site in violation of Section 73.1015 of the Rules;
>
> B. To determine whether Family Broadcasting, Inc. willfully or
> repeatedly violated §§1.89 and/or 73.1015 of the Rules by failing to
> respond to official Commission correspondence and inquiries;
>
> C. To determine whether Family Broadcasting, Inc. willfully or
> repeatedly violated §§73.1350(a), 73.1560(a), 73.1560(b) and/or
> 73.1690(b)(2) of the Rules by operating WSTX(AM) and WSTX-FM at
> variance from the terms of their authorizations;
>
> D. To determine whether Family Broadcasting, Inc. willfully or
> repeatedly violated §73.49 of the Rules by failing to enclose
> WSTX(AM)'s antenna within an effective locked fence;
>
> E. To determine whether Family Broadcasting, Inc. willfully or
> repeatedly violated §11.35 of the Rules by failing to install and
> maintain operational EAS \[Emergency Alert System\] equipment for
> WSTX(AM) and WSTX-FM;
>
> F. To determine whether Family Broadcasting, Inc. willfully or
> repeatedly violated §73.3526 of the Rules by failing to maintain
> public inspection files for WSTX(AM) and WSTX-FM;
>
> G. To determine, in light of the evidence adduced pursuant to the
> foregoing issues, whether Family Broadcasting, Inc. is basically
> qualified to be or remain a Commission licensee; and
>
> H. To determine, in light of the evidence adduced pursuant to the
> foregoing issues, whether the licenses for WSTX(AM) and/or WSTX-FM
> should be revoked.

4.  Family does not contest the merits of the charges underlying these
    issues. In fact, Family has cooperated fully in responding to an
    extensive set of requests for admissions \[47 C.F.R. §1.246\] which
    are sufficient to establish violations of Commission rules without
    the need for an evidentiary hearing.

**Revocation and Forfeiture**

5.  The Bureau requests that Family's licenses be revoked. Family argues
    that there are equities in its favor which reject revocation as an
    appropriate remedy.

6.  The OSC also requires a finding as to whether aside from revocation,
    a forfeiture order in an amount not to exceed \$275, 000 should
    issue against Family for willful and/or repeated violations of
    various sections of the Commission's rules (47 C.F.R. §§1.89, 11.35,
    73.49, 73.1015, 73.1350(a), 73.1650(a), 73.1690(b)(2), and/or
    73.3526).

## FINDINGS OF FACT 

7.  The record evidence consisting of Admissions and Family's
    Declarations of

March 12, 2001 (Barbara James-Petersen) and of March 14, 2001 (Gerald
Luz A. James) establish that in 1990, Gerald Luz A. James ("Luz James")
and his wife Asta K. James ("Asta James") purchased stations WSTX(AM)
and WSTX-FM and that from 1990 to 1998, Mr. Luz James personally carried
out all of the stations' regulatory compliance with the Commission.

8.  In July 1998, Barbara James-Petersen ("James-Peterson"), daughter of
    Luz and Asta James, became the full-time general manager of the
    stations. Currently, Ms. James-Peterson continues to be the general
    manager, and since March 14, 2001, she has served nominally as
    Family's president.[^1]

9.  Four on-site inspections were conducted by agents from the
    Commission's

San Juan, Puerto Rico Office on August 19, 1997, December 4, 1997,
September 8, 1998, and on April 13, 2000. At each inspection, violations
of the Commission's rules were detected and reported to Family, many of
which were repeats.

10. The specific findings of fact below are based upon responses of
    Family to the Bureau's Request for Admission of Facts and
    Genuineness of Documents that were served on March 23, 2001.
    Family's Answers to Requests for Admissions were timely served on
    April 3, 2001, and are found to be true and accurate.[^2]

**Issue A**

11. Family misrepresented facts concerning Family's reported relocation
    of its transmitter and antenna site as a result of a hurricane when
    the facts show that electrical power was lost and Family was evicted
    from its site for Luz James' failure to pay rent.

12. Family has admitted the following:[^3]

a\. Family represented on May 28, 1998, that Hurricane Marilyn caused
the relocation of WSTX-FM's transmitter from its licensed site to the
site of WXTX(AM)'s tower, and such claim was false.

b\. Family represented on May 28, 1998, that Hurricane Marilyn caused
the relocation of WSTX-FM's transmitter from its licensed site to the
site of WXTX(AM)'s tower, and Mr. Luz James knew that such
representation was false.

c\. Family's representation on May 15, 2000, that damage from Hurricane
Lenny on November 18, 1999, to WSTX-FM's transmitter,
studio-to-transmitter link and tower, caused Family to relocate
WSTX-FM's transmitter and antenna was false.

d\. Mr. Luz James knew that Family's representation of May 15, 2000,
regarding the relocation of WSTX-FM's transmitter and antenna was false.

e\. Family did not relocate WSTX-FM's transmitter from its authorized
site to the Fort Louise Augusta site as a result of damage caused to
WSTX-FM's tower, studio-to-transmitter link and transmitter during
Hurricane Lenny on November 18, 1999.

f\. Family has operated WSTX-FM's transmitter from the Fort Louise
Augusta site since at least January 18, 1997.

g\. On or around October 15, 1994, the owner of WSTX-FM's authorized
transmitter site cut the electrical power to WSTX-FM's transmitter and
other equipment at that site due to Family's failure to make required
rental payments for the site.

h\. On or around October 15, 1994, pursuant to court order, the owner of
WSTX-FM's authorized transmitter site seized WSTX-FM's transmitter and
other equipment at that site pending Family's payment of overdue rent
for the site.

i\. On or around October 15, 1994, Family was evicted from the
authorized transmitter site for WSTX-FM for failure to make required
rental payments for the site.

j\. Family has not operated WSTX-FM's transmitter from its authorized
site since at least October 15, 1994.

**Issue B**

13. Family failed to respond to Commission Notices of Violations ("NOV")
    issued in 1997, and again in 2000.[^4]

14. Family has admitted the following:[^5]

a\. Receipt of a letter dated August 25, 1997, from the Commission's San
Juan, Puerto Rico Office, concerning the August 19, 1997, inspection of
WSTX(AM) and WSTX-FM.

b\. Family did not respond to the August 25, 1997, letter.

c\. Family received a December 8, 1997, NOV issued to Family by the
Commission's San Juan, Puerto Rico Office, concerning the December 4,
1997, inspection of WSTX(AM).

d\. Family did not respond to the December 8, 1997, NOV for WSTX(AM).

e\. Family received a December 8, 1997, NOV issued to Family by the
Commission's San Juan, Puerto Rico Office, concerning the December 4,
1997, inspection of WSTX-FM.

f\. Family did not respond to the December 8, 1997, NOV for WSTX-FM.

g\. Family received a May 1, 2000, NOV issued to Family by the
Commission's San Juan, Puerto Rico Office, concerning the April 13,
2000, inspection of WSTX(AM).

h\. Family did not respond to the May 1, 2000, NOV concerning WSTX(AM).

i\. Family received a May 1, 2000, NOV issued to Family by the
Commission's San Juan, Puerto Rico Office, concerning violations
observed during the April 13, 2000, inspection of WSTX-FM.

j\. Family did not respond to the May 1, 2000, NOV concerning WSTX-FM.

k\. Family received a July 19, 2000, letter to Family from Commission
staff directing Family to respond to questions regarding the relocation
of WSTX-FM's transmitter from its authorized transmitter site.

l\. Family did not respond to the July 19, 2000, letter.

m\. A true and accurate copy of the July 19, 2000, letter was
transmitted directly to Ms. James-Peterson by facsimile.

n\. The Admissions Requests and Admissions Answers establish that
Family, through its agents, Luz James and Barbara James-Petersen,
received, but failed to respond, to the aforesaid NOVs as well as to the
aforesaid official Commission requests for written statements of
fact.[^6]

**Issue C**

15. Family willfully or repeatedly violated §§73.1350(a), 73.1560(a),
    73.1560(b) and/or 73.1690(b)(2) of the Commission's rules by
    operating WSTX(AM) and WSTX-FM at variance from the terms of their
    authorizations.

16. Family has admitted the following:[^7]

a\. The Commission granted a Special Temporary Authority ("STA") to
Family for WSTX(AM) from June 17, 1993, through July 31, 1993.

b\. Upon expiration of its STA for WSTX(AM), Family did not resume
operation of WSTX(AM) in accordance with its license.

c\. Upon expiration of its STA for WSTX-FM, Family did not resume
operation of WSTX-FM in accordance with its license.[^8]

d\. Family, in a January 7, 1994, letter, did not advise the Commission
that WSTX(AM) was not being operated in accordance with its license.

e\. Family, in a January 7, 1994, letter, did not advise the Commission
that WSTX-FM was not being operated in accordance with its license.

f\. Family, in an October 20, 1994, letter, did not advise the
Commission that WSTX(AM) was not being operated in accordance with its
license.

g\. Family's representation in its October 20, 1994, letter, "Now that
our AM portion is up to snuff ..." was false.

h\. Luz James knew that the claim "Now that our AM portion is up to
snuff ..." was false.

i\. On August 19, 1997, an agent from the Commission's San Juan, Puerto
Rico Office conducted an on-site inspection of WSTX(AM) and WSTX(FM).

j\. At the time of the August 19, 1997, inspection, Family did not have
an STA to operate WSTX-FM at variance from the terms of its license.

k\. At the time of the August 19, 1997, inspection, Family did not have
an STA to operate WSTX(AM) at variance from the terms of its
authorization.

l\. At the time of the December 4, 1997, inspection, Family did not have
an STA to operate WSTX-FM at variance from the terms of its
authorization.

m\. At the time of the December 4, 1997, inspection, Family did not have
an STA to operate WSTX(AM) at variance from the terms of its
authorization.

n\. At the time of the September 8, 1998, inspection, Family did not
have an STA to operate WSTX-FM at variance from the terms of its
license.

o\. At the time of the September 8, 1998, inspection, Family did not
have an STA to operate WSTX(AM) at variance from the terms of its
authorization.

p\. At the time of the April 13, 2000, inspection, Family did not have
an STA to operate WSTX-FM at variance from the terms of its
authorization.

q\. At the time of the April 13, 2000, inspection, Family did not have
an STA to operate WSTX(AM) at variance from the terms of its
authorization.

r\. From July 19, 1996, until June 12, 2000, Family did not have an STA
to operate WSTX(AM) at variance from the terms of its license.

s\. From June 18, 1997, until June 12, 2000, Family did not have an STA
to operate WSTX-FM at variance from the terms of its license.

t\. From December 13, 2000, to \[March 23, 2001\], Family \[did not
have\] an STA to operate WSTX(AM) with facilities other than those
appearing on its license.

u\. From December 13, 2000, to \[March 23, 2001\], Family \[did not
have\] an STA to operate WSTX-FM with facilities other than those
appearing on its license.

v\. Family has not operated WSTX-FM's transmitter from its authorized
site since at least October 15, 1994.

**Issue D**

17. Family willfully or repeatedly failed to enclose WSTX(AM)'s antenna
    within an effective locked fence.

18. Family has admitted the following:[^9]

a\. At the time of the August 19, 1997, inspection, WSTX(AM) was
transmitting with approximately 2800 watts output power.

b\. At the time of the August 19, 1997, inspection, WSTX(AM) was
transmitting using an antenna tower with a height of approximately 110
feet above ground level.

c\. At the time of the August 19, 1997, inspection, there was no fence
enclosing WSTX(AM)'s antenna tower.

d\. At the time of the December 4, 1997, inspection, WSTX(AM) was
transmitting with approximately 2800 watts output power.

e\. At the time of the December 4, 1997, inspection, WSTX(AM) was
transmitting using an antenna tower with a height of approximately 110
feet above ground level.

f\. At the time of the December 4, 1997, inspection, a chain link fence
enclosing WSTX(AM)'s antenna tower was under construction but was not
yet completed.

g\. Family, in a May 28, 1998 letter, sought to assure the Commission
that a fence completely enclosed the AM radiator thereby preventing
public access thereto.

h To the extent that Family represented to the Commission that a fence
completely enclosed the AM radiator, thereby preventing public access
thereto, such suggestion was false.

i\. To the extent that Family represented to the Commission that a fence
completely enclosed the AM radiator, thereby preventing public access
thereto, Mr. Luz James knew such suggestion was false.

j\. Ms. James-Petersen accompanied the Commission's agent during the
September 8, 1998, inspection.

k\. At the time of the September 8, 1998, inspection, WSTX(AM) was
transmitting with approximately 2250 watts output power.

l\. At the time of the September 8, 1998, inspection, WSTX(AM) was
transmitting using an antenna tower with a height of approximately 110
feet above ground level.

m\. At the time of the September 8, 1998, inspection, there was a chain
link fence surrounding WSTX(AM)'s antenna tower, but the fence had an
opening which permitted access to the antenna tower.

n\. Ms. James-Petersen accompanied the Commission's agent during the

April 13, 2000, inspection.

o\. At the time of the April 13, 2000, inspection, WSTX(AM) was
transmitting with approximately 325 watts output power.

p\. At the time of the April 13, 2000, inspection, WSTX(AM) was using a
long-wire antenna.

q\. At the time of the April 13, 2000, inspection, there was a chain
link fence surrounding WSTX(AM)'s long-wire antenna, but the fence had
an opening which permitted access to the antenna.

**Issue E**

19. Family willfully or repeatedly violated §11.35 of the Commission's
    rules by failing to install and maintain operational Emergency Alert
    System ("EAS") equipment for WSTX(AM) and WSTX-FM.

20. Family has admitted to the following:[^10]

a\. At the time of the August 19, 1997, inspection, Family did not have
any EAS equipment installed at the stations' main studio.

b\. Family received a letter dated August 25, 1997, to Family from the
Commission's San Juan, Puerto Rico Office, concerning the August 19,
1997, inspection of WSTX(AM) and WSTX-FM.

c\. Family did not respond to the August 25, 1997 letter.

d\. At the time of the December 4, 1997, inspection, Family did not have
any EAS equipment installed at the stations' main studio.

e\. Family received a Notice of Violation ("NOV") dated December 8,
1997, issued to Family by the Commission's San Juan, Puerto Rico Office,
concerning the December 4, 1997, inspection of WSTX(AM).

f\. Family received the December 8, 1997, NOV for WSTX(AM).

g\. Family did not respond to the December 8, 1997, NOV for WSTX(AM).

h\. Family received a Notice of Violation ("NOV") dated December 8,
1997, issued to Family by the Commission's San Juan, Puerto Rico Office,
concerning the December 4, 1997, inspection of WSTX-FM.

i\. Family received the December 8, 1997, NOV for WSTX-FM.

j\. Family did not respond to the December 8, 1997, NOV for WSTX-FM.

k\. Ms. James-Petersen accompanied the Commission's agent during the
September 8, 1998, inspection.

l\. At the time of the September 8, 1998, inspection, EAS equipment was
installed at the stations' main studio but the equipment was not
operational.

m\. Ms. James-Petersen accompanied the Commission's agent during the

April 13, 2000, inspection.

n\. At the time of the April 13, 2000, inspection, EAS equipment was
installed at the stations' main studio but the equipment was not
operational.

**Issue F**

21. Family willfully and repeatedly failed to maintain public inspection
    files.

22. Family has admitted to the following:[^11]

a\. At the time of the August 19, 1997, inspection, Family did not have
a public inspection file for either station.

b\. On April 13, 2000, an agent from the Commission's San Juan, Puerto
Rico Office conducted an on-site inspection of WSTX(AM) and WSTX-FM.

c\. Ms. James-Petersen accompanied the Commission's agent during the
April 13, 2000, inspection.

d\. At the time of the April 13, 2000, inspection, Family did not have a
public inspection file for either station at the stations' main studio.

**Issues G and H**

23. These issues raise only the conclusory questions of whether, in
    light of the evidence adduced relative to the preceding issues,
    Family is basically qualified to remain a Commission licensee and
    whether Family's licenses for WSTX(AM) and WSTX-FM should be
    revoked.[^12]

# Factual Findings in Mitigation

24. Since Family acquired the stations in 1990, Mr. Luz James has
    operated them as the controlling shareholder. He served as Family's
    president and as Family's principal he is legally responsible for
    all regulatory compliance.

25. From 1997 to 2000, after four on-site inspections, Luz James either
    failed to respond to or answered untruthfully multiple requests for
    information. As indicated by the above findings, the violations
    found constituted serious deviations from the terms of the licenses
    including failures to install, operate and maintain EAS equipment,
    failures to maintain public inspection files, and a failure to erect
    and maintain a fence suitable to protect the public from harmful
    radiation emissions.

26. However, there were circumstances attendant to those violations that
    must be considered. In September 1990, the stations were seriously
    damaged by Hurricane Hugo and the tower for WSTX(AM) was blown over.
    The same tower damage was repeated by Hurricane Marilyn. In November
    1999, Hurricane Lenny overturned the AM tower for a third time. To
    avoid a fourth recurrence, Family sought to reduce the tower height.
    It is officially noted that Family has filed an application to
    reduce the height of the AM tower from 305 ft. to 180 ft.

27. In 1998, in an effort to correct an eroding situation, Barbara
    James-Petersen became the station manager. She repaired a gap in a
    security fence as soon as she learned of its threat to the public
    safety. She timely saw to providing a new power supply to the EAS
    printer which is now operable. She had the public inspection file
    reconstructed so that it is now complete. And according to her
    Declaration, she has taken steps to restore the FM station to its
    authorized power by construction of a new transmitting facility.

28. Since assuming the position of station general manager and being
    designated Family's president, Barbara James-Petersen has utilized
    communications counsel to conduct a compliance audit with a view
    towards bringing the stations into full compliance. Luz James has
    resigned as president and has given his stock to his children. Ms.
    James-Petersen filed applications for Commission authority to reduce
    the height of the AM tower (File No. BPH-20010622AAF) and to remove
    the FM station to a site on Recovery Hill (File No.
    BPH-20010316AAD). By an informal promise, Asta James should make
    available the funds needed for station improvements.

29. Family represents that it donates broadcasting time to FEMA (30
    minutes during five days of each week) to communicate relief efforts
    to the portions of St. Croix in need of relief. Also, one hour per
    week is donated to the local Department of Public Safety. And as a
    further service to the community, Family now has a policy of
    allowing credit for advertising to local merchants who have been
    impacted by hurricane storm damage.

**CONCLUSIONS OF LAW**

30. The Commission's rules provide that in considering summary decision:

> The party filing the motion may not rest upon mere allegations or
> denials but must show, by affidavit or by other materials subject to
> consideration by the presiding officer, that there is no genuine issue
> of material fact for determination at the hearing.

47 C.F.R. §1.251(a)(1). As the moving parties on cross motions, the
Bureau and Family each has the burden of establishing that a favorable
summary decision would be appropriate based on the pleadings and the
papers submitted. [Summary Decision Procedures]{.underline}, 34 F.C.C.
2d 485, 487-88 (1972). Considerable weight will be given to the
admissions of Family. Family has filed Declarations of Barbara
James-Petersen and Luz James which also are given consideration but
which receive less weight than the admissions.

31. The ultimate factual issue has been admitted that Family has
    repeatedly violated the Commission's rules with respect to the
    operation of its AM and FM stations on St. Croix. Thus, with respect
    to the Bureau's Motion, there is no genuine issue of material fact
    that is left to resolve by hearing. Similarly, in view of the
    universal admissions by Family of the Bureau's detailed factual
    allegations, there is no genuine issue of material fact for Family
    to prove. The only remaining questions concern law, policy, and the
    equities as to whether this record requires license revocation
    and/or forfeiture.

32. The evidence overwhelmingly supports findings and conclusions of
    serious violations. First, there is an established pattern of a lack
    of candor. In two separate responses to the Commission, Family
    falsely stated that its move to an unauthorized location occurred
    because a hurricane had damaged its authorized facilities, thus
    warranting the move. However, Family knew that its move from its
    authorized site did not result from hurricane damage but followed
    eviction for unpaid rent. Thus, Family's statements blaming
    Hurricane Lenny or Hurricane Marilyn were false and were known by
    Luz James to be false. Accordingly, the evidence shows that Family
    intentionally and repeatedly misrepresented material facts.

[See]{.underline} [David Ortiz Radio Corp. v. F.C.C.]{.underline}, 941
F.2d 1253, 1260 (D.C. Cir. 1991); [Fox River Broadcasting,
Inc.]{.underline}, 93 F.C.C. 2d 127, 129 (1983).

33. There also is a demonstrated disregard for the public safety. From
    August 19, 1997, up to and including April 13, 2000, Family did not
    have a fence that completely enclosed the WSTX(AM) tower. In some
    instances, there was no fence whatsoever. In other instances, a
    fence existed, but it had an opening that permitted access to the
    antenna. Family violated §73.49 of the Commission\'s rules and
    exposed the public to danger by allowing unimpeded access to the
    WSTX(AM) antenna. Also, Family did not have EAS capability in
    violation of §11.35. These violations occurred despite the
    Commission's agent having informed Family on multiple occasions of
    its shortcomings*.* [See]{.underline} [KYOO
    Communications]{.underline}, Forfeiture Order, DA 01-1103, released
    May 1, 2001 (Enforcement Bureau*);* [Arnold Broadcasting Company,
    Inc.]{.underline}, Forfeiture Order, 16 F.C.C. Rcd 267 (Enforcement
    Bureau), [review granted in part]{.underline}, [denied in
    part]{.underline}, FCC

01-197, released July 5, 2001. Family repeatedly failed to respond to
NOVs in violation of §1.89(b) of the Commission rules which requires
written answers within ten days. [See]{.underline} [Donald W. Kaminski,
Jr.]{.underline}, Notice of Apparent Liability for Forfeiture, DA
01-1192, released May 14, 2001 (Enforcement Bureau); [American Radio
Brokers, Inc.]{.underline}, Forfeiture Order, 15 F.C.C. Rcd 19712
(Enforcement Bureau 2000), [recon]{.underline}*.* [denied]{.underline},
DA 01-811, released April 3, 2001 (Enforcement Bureau).

34. The legal conclusions drawn from this record demonstrate that Family
    is not qualified to remain a Commission licensee and that its
    licenses should be revoked. Truthfulness and reliability, the
    prerequisites for operating a broadcast station in the public
    interest, are lacking. [See]{.underline} [Policy Regarding Character
    Qualifications in Broadcast Licensing]{.underline}, 102 F.C.C. 2d
    1179 (1986). It cannot be ignored that Family has repeatedly
    deceived the Commission, ignored Commission correspondence, operated
    its stations at variance with the terms of their licenses, and
    failed to comply with rules established to promote public safety.
    The Bureau has made its case that Family cannot be trusted to be
    truthful with the Commission or to operate its stations in
    accordance with the Communications Act and Commission rules or with
    a genuine concern for public safety. Under these circumstances,
    revocation of Family's license should be the remedy.

[See]{.underline} [Chameleon Radio Corporation]{.underline}, 13 F.C.C.
Rcd 13549 (1998), [recon]{.underline}*.* [denied]{.underline}, 15 F.C.C.
Rcd 24173 (2000), [appeal]{.underline} [pending]{.underline}, No.
00-1546 (D.C. Cir. December 28, 2000); [Center for Study and Application
of Black Economic Development]{.underline}, 10 F.C.C. Rcd 2836 (Rev. Bd.
1995), [recon]{.underline}*.* [denied]{.underline}, 10 F.C.C. Rcd 6069
(Rev. Bd. 1995), [review]{.underline} [denied]{.underline}, 11 F.C.C.
Rcd 1144 (1996); [Catoctin Broadcasting Corp. of New York]{.underline},
2 F.C.C .Rcd 2126 (Rev. Bd. 1987), [aff'd]{.underline} [in]{.underline}
[part]{.underline},

4 F.C.C .Rcd 2553, [recon.]{.underline} [denied]{.underline}, 4 F.C.C.
Rcd 6312 (1989); [Mid-Ohio Communications, Inc.]{.underline}, 104 F.C.C
.2d 572 (Rev. Bd. 1986), [review]{.underline} [denied]{.underline}, 5
F.C.C .Rcd 940*,* [recon]{.underline}*.* [dismissed in
part]{.underline}*,* [denied in part]{.underline}, 5 F.C.C. Rcd 4596
(1990).

**Family's Arguments in Opposition to Revocation**

35. Family contends that notwithstanding its damaging admissions that
    justify revocation, all future problems can be rectified by removing
    control from Luz James and transferring corporate control to other
    members of the Luz James family. To give assurance that Family will
    comply in the future, Family is offering to remove Luz James by
    assignment of ownership to members of his immediate family. The
    Commission generally does not allow the target of a revocation
    proceeding to sell or assign broadcast stations to a third party
    before the proceeding is favorably resolved. However, there are
    three exceptions to that policy, each of which, Family argues,
    should apply here.

36. The first exception is the Minority Distress Sale policy which
    permits a licensee whose license has been designated for revocation
    hearing to assign the license prior to the commencement of the
    hearing to a minority controlled entity. [Martin W.
    Hoffman]{.underline}, 15 F.C.C. Rcd 22086 (2000). Here, there would
    be an analogous transfer of control from the wrongdoing Luz James to
    Luz James' children. The Presiding Judge is aware that Barbara
    James-Peterson and her siblings are minorities, [i.e.]{.underline},
    African-Americans.[^13] However, there was no assignment completed
    before the commencement of this proceeding and the Presiding Judge
    has no authority over a transfer application which is within the
    authority delegated to the Mass Media Bureau to decide.

37. The second exception is the Second Thursday doctrine. [Second
    Thursday Corp.]{.underline}, 22 F.C.C. 2d 515 (1970); 25 F.C.C. 2d
    112 (1970). That policy permits a sale in the context of a
    bankruptcy where the wrongdoing party does not benefit from the
    sale. Here, the proposed transfer of stock to the children of Luz
    James is represented to be an outright gift. Therefore, there is no
    evident monetary benefit to the wrongdoer and the proposed transfer
    is, to that extent, consistent with the Second Thursday doctrine.
    But there is no trustee to assure that station income is not used to
    repay debts incurred by Luz James or for other personal expenses.

38. In a third exception, Family cites an unusual case in which the
    Commission permitted a wrongdoer to transfer stock to third persons
    other than his parents, wife and children. In sorting out the Thomas
    Root imbroglio, the Review Board conditionally upheld a decision by
    an administrative law judge renewing the license of an FM broadcast
    station where Root, a former principal, had been sentenced to a
    lengthy prison term for serious broadcast-related felonies.
    [Petroleum v. Nasby Corporation]{.underline}, 10 F.C.C. Rcd 6029
    (Rev. Bd. 1995). The renewal was granted upon condition that the
    disqualified wrongdoer, who was not involved in station operations,
    would transfer to unrelated persons his stock, the stock of his
    children, and the stock beneficially owned by other family members.
    The Review Board specifically decided not to permit stock retention
    by members of the Root family and would grant renewal only upon
    complete divestiture of Root stock to unrelated third parties.
    [Id]{.underline}. at 6033. And the Commission would accept that
    result, only after the case was remanded to the judge for further
    findings on Root's surrender of control. [Petroleum v. Nasby
    Corporation]{.underline}, 11 F.C.C. Rcd 3494 (1996).
    [Nashby]{.underline} does not appear to favor Family's solution for
    an interfamily transfer.

Family's Arguments Considered and Rejected

39. Family concedes that except for mitigating circumstances which focus
    on a contemplated transfer of control, the multiple violations found
    in this case "would clearly require revocation of the licenses" that
    are in issue. Family argues that the Commission will consider its
    pending assignment application and decide whether the assignment
    should be permitted under one of the exceptions to a transfer while
    this proceeding is pending, citing [LaRose v. F.C.C.]{.underline},
    494 F.2d 1145 (D.C. Cir. 1974). That case involved a trustee in
    bankruptcy assigning a license under a supervised bankruptcy sale to
    pay off legitimate creditors. The license was challenged in a
    renewal proceeding wherein serious violations of the Commission's
    rules were alleged. The court found that under the Second Thursday
    doctrine, the Commission would need to rule on the qualifications of
    the assignee and that denial of a license renewal would not moot the
    assignment issue. [Id]{.underline}. But in this case, that
    determination would be made outside of this adjudicated hearing by
    the Mass Media Bureau as the Commission's designee. And in any
    event, in this case there is no adjudicated bankrupt, no trustee, no
    receiver and no rights of creditors to be protected. Therefore, the
    [LaRose]{.underline} decision is not applicable here.

40. The common thread running through the Bureau's opposition to all
    three theories (Minority Distress Sale, Second Thursday,
    [Nasby]{.underline} holding) is the lack of sufficient evidence in
    this record to conclude that the assignees, who are the children of
    Mr. Luz James, will be independent of their parents' control or
    influence. Other circumstances noted by the Bureau in questioning
    control are the failure or inability of Ms. James-Petersen to meet
    routine discovery requests, her lack of personal knowledge about
    Family's current net worth, its financial history, mortgage debt, or
    outstanding loans from stockholders. (Deposition of James-Petersen
    at Tr. 68-70.) She is unable to show on this record that as station
    manager, president and stockholder of a restructured Family, she
    will be independent of Luz and Asta James.

41. The factors raising doubts with respect to independence of the
    contemplated assignees also create genuine issues of material fact
    that remove Family as a candidate for a favorable summary decision
    on revocation. [Cf.]{.underline} [Nasby Corporation]{.underline},
    [supra]{.underline} which required a remand to determine whether Mr.
    Root might be able to influence the licensee's affairs
    notwithstanding an assignment to non-family assignees. A
    particularly significant issue of fact here is with respect to the
    independence that Ms. James-Petersen would be able to exercise as a
    chief operating officer in view of the continuing dependence of the
    stations on financial support from Asta James. It is significant
    that Asta James has given no more than a parole assurance to provide
    funds to improve and operate the station. There is no way of
    determining without further discovery and a hearing whether that
    loose financial arrangement might lead to residual control by the
    parents. [See]{.underline} [Nasby]{.underline}, [supra]{.underline}
    11 F.C.C. Rcd at 3495-96.

42. Finally, substantial evidence shows that under Luz James' control,
    which included a period of time when Ms. James-Petersen was station
    manager, there were willful violations that justify the remedy of
    revocation. Her past performance does not instill a confidence that
    she can bring the stations into full compliance in the future.
    Family has failed in its proof to show by reliable evidence that the
    proposed familial assignees would guarantee future compliance. Luz
    James, and all others associated with the operations of the Family
    stations, including Barbara James-Petersen and Asta James, knew from
    the designated renewal proceeding in 1997, and the subsequent
    Notices of Violations incident to on-site-inspections, that there
    was a probability of revocation if corrective action was not taken,
    and particularly if Family was less than candid in its dealings with
    the Commission. Family ignored the warnings and chose to violate the
    law. Why should the future be any different? There are presented no
    reasonable probabilities of future compliance that can alter the
    historical merits of this case.

**Overall Conclusions**

43. This record provides the highest quality of proof. It is complete
    with respect to each issue. It establishes that the stations were
    operated by Luz James in disregard of the core responsibility of
    maintaining uninterrupted broadcasting. There was also a
    demonstrated lack of care for protecting the public from harmful
    emissions or for providing an emergency alert system. The highest
    licensee duty is constant candor with the Commission. In violation
    of that duty, Luz James was purposefully and repeatedly providing
    the Commission with false and misleading reports and information on
    significant subjects such as transmitter location and hurricane
    damage in an effort to cover up an unauthorized site. Luz James even
    used the hurricane tragedies of a battered St. Croix to hide a site
    eviction for nonpayment of rent. Granted, those hurricanes that were
    beyond the control of any broadcaster would likely cause some
    temporary disruption. But even allowing for such acts of God,
    Family's violations were persistent and intentional and the absence
    of candor was pervasive.

44. As a result, significant portions of the Commission's enforcement
    budget were spent on two Family proceedings which were assigned to
    administrative law judges. In 1996, the Mass Media Bureau designated
    Family's license for a renewal proceeding based on its discontinued
    broadcasting. Former Presiding Judge Edward Luton honored the pledge
    of Family to continue operations in compliance with Commission rules
    and granted Family a favorable summary decision. [Family
    Broadcasting, Inc.]{.underline}, 12 F.C.C. Rcd 18700 (Adm. L. J.
    1997).

However, in doing so, he noted with dissatisfaction the prolonged period
of station silence that was never sanctioned. Instead, in open defiance
of the Commission, Family had never applied for an authorization to go
off the air.

45. In this second enforcement proceeding, Family has shown that it
    never gained true appreciation for its broadcast licenses and again
    defied the Commission with self-help measures, failures to respond
    to inquiries, and lying about site locations. The mitigating
    circumstances noted and explicated above cannot overcome Family's
    demonstrated abandonment of the public interest.

46. Finally, for purposes of this Summary Decision, the repeated
    wrongdoings and intentional untruths of Luz James cannot be
    confidently corrected in the future by a dubious assignment of
    control to children who will need to rely on the continuing
    financial generosity and wherewithal of the wife of Luz James.[^14]

47. It is concluded that there are not mitigating circumstances that are
    sufficient to offset the purposeful violations attributable to Luz
    James and Family as found by this record.

Forfeiture Not Appropriate

48. The Bureau argues that although the violations decided against
    Family merit license revocation, the impact of the violations were
    not sufficiently catastrophic in their consequences or potential
    consequences to warrant a forfeiture. The Presiding Judge concurs in
    not assessing a forfeiture in this case. [See]{.underline} [Oil
    Shale Broadcasting Co. (KWSR)]{.underline}, 68 F.C.C. 2d 517, 528 --
    29 (1978) (unlawful conduct held not worthy of forfeiture).
    [Cf.]{.underline} [Abacus Broadcasting Corp.,]{.underline} 8 F.C.C.
    Rcd 5110, 5113 (Review Bd. 1993) (deceit softened somewhat where
    primary motive was to gain a tactical advantage). These cases are
    not directly on point but are relevant to discretion and are relied
    on by the Presiding Judge as support for exercising his discretion
    in not assessing a forfeiture here. [See]{.underline} [Standards for
    Assessing Forfeitures]{.underline}, 7 F.C.C. Rcd 5339, 5340 (1992)
    (broad discretion in choosing remedies and sanctions).

49. The willful violations of Family could support a forfeiture.
    [Compare]{.underline} [David R. Price,]{.underline} 7 F.C.C. Rcd
    6550 (1992), [recon.]{.underline} [denied]{.underline}, 8 F.C.C. Rcd
    2960 (1993) (revocation and forfeiture of \$8,000 where violations
    included failure to keep tower lighted that was near an airport).
    However, in view of the finality of revocation which effectively
    removes Luz James and Family from Commission licensing, and in view
    of the age and adverse health of Luz James and the mitigating
    circumstances of hurricane tragedies on St. Croix, and in view of
    the fact that the violations apparently did not result in monetary
    profit for this unsuccessful, small business, as a matter of
    discretion, a forfeiture shall not be assessed against Family
    Broadcasting, Inc. in this Summary Decision.

**Rulings**

Accordingly, IT IS ORDERED that the Enforcement Bureau's Motion for
Summary Decision IS GRANTED.

IT IS FURTHER ORDERED that the Motion for Summary Decision filed by
Family Broadcasting, Inc. IS DENIED.

IT IS FURTHER ORDERED that in view of the revocation of the licenses of
Family Broadcasting, Inc. and the unique circumstances of this case,
imposition of a forfeiture would not be appropriate and a forfeiture
will not be assessed.

IT IS FURTHER ORDERED that the licenses for Stations WSTX(AM) and
WSTX(FM), Christiansted, U.S. Virgin Islands ARE HEREBY REVOKED.[^15]

FEDERAL COMMUNICATIONS COMMISSION

Richard L. Sippel

Administrative Law Judge

[^1]: Family has filed an application to transfer control of Family from
    Luz and Asta James to their four adult children, one whom is Barbara
    James-Petersen. Family recognizes that where character
    qualifications issues have been designated against a licensee in a
    renewal or revocation hearing, the license cannot be assigned (or
    control of the licensee transferred) until the licensee is found
    qualified. [Jefferson Radio Co. v. FCC]{.underline}, 340 F.2d 781
    (D.C. Cir. 1964).

[^2]: [See]{.underline} [Memorandum Opinion and Order]{.underline}, FCC
    01M-09, released April 25, 2001 (Presiding Judge accepts as an
    established fact each of the Bureau's requests to admit).

[^3]: [See]{.underline} Bureau's Motion, Para. 4.

[^4]: Luz James failed to answer the NOVs as required under §1.89(b).
    There is no evidence of fraudulent misrepresentations. Therefore,
    the reference to §73.1015 requiring truthful responses is inapposite
    because the violation is only in failing to respond to the NOVs.

[^5]: [See]{.underline} Bureau's Motion, Para. 5.

[^6]: At the time she received the NOVs, Ms. James-Petersen was Luz
    James' replacement as general manager.

[^7]: [See]{.underline} Bureau's Motion, Para. 6.

[^8]: WSTX-FM was operating in accordance with an STA issued in 1989.
    Correspondence from the Commission dated June 10, 1993, accounts for
    substandard operations since 1989, and reflects that Luz James had
    promised to erect an antenna for WSTX-FM by September 1994.
    [See]{.underline} Bureau's Motion, Attachment E. It appears that as
    of January 7, 1994, Family continued to be operating WSTX-FM at
    substandard facilities [and]{.underline} without a current STA.

[^9]: [See]{.underline} Bureau's Motion, Para. 7.

[^10]: [See]{.underline} Bureau's Motion, Para. 8.

[^11]: [See]{.underline} Bureau's Motion, Para. 9.

[^12]: [See]{.underline} Bureau's Motion, Para. 10.

[^13]: The Presiding Judge attended the deposition of Ms.
    James-Peterson, taken on May 10, 2001 at Commission headquarters, to
    assess demeanor of Family's key witness in anticipation of motions
    for summary decision. However, there are no demeanor findings
    required on this uncontroverted record.

[^14]: Family has raised the question of assignment as a defense to
    revocation and therefore to that extent it is addressed in this
    Summary Decision.

[^15]: This [Summary Decision]{.underline} will become effective and
    this proceeding terminated 50 days after its public release if
    exceptions are not filed within 30 days after its release and if the
    Commission does not review this ruling on its own motion. 47 C.F.R.
    §1.276 (d).