March 30, 2007

DA 07-1553

**In Reply Refer to:**

1800B3-BSH/LAS

Released: March 30, 2007

Mark Chapman, Court-Appointed Agent

Sumiton Broadcasting Company, Inc.

5318 Whisper Wood Drive

Hoover, AL 35226

Re: DWRSM(AM), Sumiton, AL

Facility ID No. 63652

File No. BR-20040315ACS

Application for Renewal of License

File No. BAL-20050121ACS

Application for Assignment of License

**Petition for Reconsideration**

Dear Mr. Chapman:

This is in reference to the Petition for Reconsideration (the
"Petition") filed August 15, 2005, by Mark Chapman on behalf of Sumiton
Broadcasting Company, Inc. ("Sumiton"), previous licensee of former
Station WRSM(AM), Sumiton, Alabama (the "Station"). The Petition
requests reconsideration of the July 14, 2005, staff decision (the
"Staff Decision")[^1] finding that the Station's license had expired as
a matter of law due to the non-operation of the Station and dismissing
Sumiton's above-captioned applications to: (1) renew the license for the
Station (the "Renewal Application); and (2) assign the Station's license
from Sumiton to American Trust Corporation (the "Assignment
Application"). The Petition argues that Sumiton ceased operation of the
Station while the licensee was controlled by Thomas Herb Steadman
("Steadman"), who had acted without the knowledge or consent of
Sumiton's other shareholders.[^2] Chapman, the court-appointed agent of
Sumiton, asks that we consider the diligent efforts that Sumiton has
made, pursuant to court directive, to restore the Station to operation.
For that reason, the Petition requests that we exercise our
statutorily-authorized discretion[^3] to reinstate the Station's license
and grant the Renewal Application and the Assignment Application. For
the reasons stated below, we grant the Petition to the extent indicated
herein, and reinstate the license for the Station, the Station's call
sign, the Renewal Application and the Assignment Application.

**Background**. *Corporate Control.* Sumiton's March 15, 2004, FCC Form
323 Ownership Report indicates that Steadman held 66.67 percent of the
Sumiton stock and the "Estate of J.C. Chapman" ("Chapman Estate") held
the remaining 33.33 percent.[^4] In response to civil litigation among
Sumiton's shareholders, on September 9, 2004, the Circuit Court of
Jefferson County, Alabama (the "Circuit Court") issued an Order
appointing Chapman[^5] the duly-authorized agent of Sumiton.[^6] The
Circuit Court further found that Steadman had "offered no good reason"
why the assets of Sumiton should not be sold to an entity capable of
operating the Station in the public interest,[^7] and that the sale
proposed in the Asset Sales Agreement with American Trust Corporation,
the prospective purchaser, "appears to be a sound business decision that
would benefit the parties."[^8]

*Cessation of Station Operation.* The record provides the following
information concerning the Station's period of discontinued operation.
In February 2003, Commission staff received a telephone call from
Chapman, inquiring if Commission records indicated whether the Station
was operating. When told by staff that Sumiton had not notified the
Commission of discontinued operations, Chapman expressed his belief that
Steadman had taken the Station off the air. As a result of this call, on
February 21, 2003, the staff sent Sumiton an operational status inquiry
letter.[^9] While Sumiton did not provide a written response, in March
2003, Steadman called the staff, advised that the Station had gone off
the air, and requested that Commission records reflect that fact. On
February 3, 2004, Toni Chapman Brinker, the executrix of the Chapman
Estate, faxed material to the Commission, including a February 2, 2004,
letter from Chapman indicating that the Station had resumed operations
as of January 30, 2004.

On March 15, 2004, Chapman filed the Station's Renewal Application on
behalf of Sumiton.[^10] The Renewal Application stated that Steadman
"took the station off the air without notification to the FCC and the
minority shareholder Chapman . . . . "[^11] In April 2004, Steadman
phoned the staff, complained about Chapman's activities involving the
Station, and stated that the Station had been silent prior to the
staff's February 21, 2003, operational status inquiry letter. The staff
asked Steadman to submit documentation supporting his statement. On June
1, 2004, Steadman faxed to the Commission copies of two letters
concerning the "closing of WRSM Radio," the first dated July 1, 2002,
and the second dated June 16, 2003. These two letters, both under
Steadman's signature, had not been previously received by the
Commission.[^12] The July 1, 2002, letter stated that the Station had
ceased broadcasting on June 30, 2002. The June 16, 2003, letter also so
stated, and added that "\[t\]here was and is no intent to resume
broadcasting."

In order to determine whether the Renewal Application should be granted,
on May 19, 2005, the staff sent a second operational status inquiry
letter to Sumiton.[^13] In his June 20, 2005, response (the "Response
Letter"), Chapman informed the Commission that the Station had been
silent from at least October 2002 until January 30, 2004. Chapman
further stated that he had operated the Station intermittently from
January 30 through September 14, 2004, at which time "American Trust
Corporation . . . took over operations of WRSM(AM) . . . and has, to the
best of my knowledge, operated WRSM" since that time.[^14] In light of
this information provided in the Response Letter, the Staff Decision
found that the Station had been silent from at least sometime in October
2002 until January 30, 2004. Therefore, the Staff Decision concluded
that the WRSM(AM) license had expired as a matter of law pursuant to
Section 312(g) of the Communications Act of 1934, as amended (the
"Act"), [^15] because the Station had failed to transmit broadcast
signals for a consecutive 12-month period.

**Discussion**. As noted in the Petition, although Section 312(g)
provides for the forfeiture of a broadcast license under such
circumstances, it also allows the Commission the discretion, where
appropriate, to extend or reinstate a forfeited license, notwithstanding
more than 12 months of station silence. Specifically, in pertinent part,
Section 312(g) provides, ". . . the Commission may extend or reinstate
such station license if the holder of the station license prevails in an
administrative or judicial appeal, the applicable law changes, or for
any reason to promote equity and fairness.\"[^16] We find that the
Petition demonstrates circumstances that merit reinstatement.

Our determination to exercise such discretion in this matter is founded
on the Commission's long-standing policy to accommodate court decrees,
unless a public interest determination under the Act compels a different
result.[^17] Here, the Circuit Court has made clear that it issued its
Order to safeguard the interests of the corporation, as well as those of
the Sumiton shareholders, much as a bankruptcy court protects the
interests of innocent creditors.[^18] In this regard, the Circuit Court
Order states that "\[i\]t is in the interests of the corporation, all
its shareholders, and the public generally that the corporation's assets
be transferred to another entity that can put those assets to good use."
[^19]

Although Sumiton ceased broadcasting and kept the Station off the air
for more than 12 consecutive months, as noted above, Section 312(g) of
the Act allows the Bureau the exercise of discretion here, should we
determine that circumstances warrant reinstatement of the Station's
license. Because Chapman is acting to effectuate the Circuit Court
Order, which was primarily issued to protect the corporation and its
shareholders, we find this case warrants the exercise of that
discretion.[^20]

**Conclusion**. Based on the above, we grant the Petition to the extent
indicated herein, reinstate the cancelled WRSM(AM) license, and
reinstate the Renewal Application and the Assignment Application.
Although both the Renewal Application and the Assignment Application had
previously been accepted for filing, given the reinstatement action
taken herein, we find it in the public interest to reissue public
notices accepting the two applications for filing.[^21] Therefore,
petitions to deny the Assignment Application must be filed not later
than 30 days after issuance of the public notice of acceptance of that
application.[^22] Petitions to deny the Renewal Application must be
filed not later than 90 days after issuance of the public notice of
acceptance of that application.[^23] We also direct Sumiton to broadcast
over WRSM(AM) all post-filing announcements regarding the Renewal
Application required by Section 73.3580(d)(4)(ii) of the Rules,[^24] had
the Renewal Application been filed on the date of this letter.
Additionally, we direct Sumiton to submit to the Commission copies of
any agreement(s) between itself and American Trust Corporation relating
to the operation of WRSM(AM) within 30 days from the date of this
letter.

Accordingly, IT IS ORDERED That the August 15, 2005, Petition for
Reconsideration filed by Sumiton Broadcasting Company, Inc. IS GRANTED
to the extent indicated herein. IT IS FURTHER ORDERED That the
previously forfeited license for WRSM(AM) IS REINSTATED. IT IS FURTHER
ORDERED That the call sign DWRSM(AM), which indicated the station's
deletion, IS CHANGED to WRSM(AM). IT IS FURTHER ORDERED That the
application to renew the license for Station

WRSM(AM) and the application to assign the license for Station WRSM(AM)
from Sumiton Broadcasting Company, Inc. to American Trust Corporation
ARE REINSTATED TO PENDING STATUS with their original file numbers
(BR-20040315ACS and BAL-20050121ACS, respectively),

AND ARE ACCEPTED FOR FILING.

Sincerely,

Peter H. Doyle

> Chief, Audio Division
>
> Media Bureau

cc: Thomas Gutierrez, Esq.

[^1]: *See Letter to Mark A. Chapman*, Ref. No. 1800B3-ALM (MB July 14,
    2005).

[^2]: *See* Petition at 3. *See also* Renewal Application, Exhibit 6.

[^3]: *See* 47 U.S.C. § 312(g).

[^4]: File No. BOA-20040315ADF.

[^5]: Toni Chapman Brinker, executrix of the Chapman Estate, had granted
    a Durable Special Power of Attorney to Mark Chapman on March 5,
    2004, which authorized him to act on behalf of the Chapman Estate.
    *See* Durable Special Power of Attorney, Jefferson County, Alabama,
    March 5, 2004.

[^6]: Civil Action CV-2004-0173-RSV, Order, Sept. 9, 2004 (the "Circuit
    Court Order").

[^7]: Circuit Court Order at 2.

[^8]: *Id.*

[^9]: *Letter to Herb Steadman, Sumiton Broadcasting Co*., *Inc*., Ref.
    No. 1800B-ALM (MB Feb. 21, 2003).

[^10]: Section 73.3539(a) of the Rules requires that applications for
    renewal of license for broadcast stations must be filed not later
    than the first day of the fourth full calendar month prior to the
    expiration date of the license sought to be renewed. An application
    for renewal of the WRSM(AM) license should have been filed by
    December 1, 2003, four months prior to the Station's April 1, 2004,
    license expiration date, but was not. Sumiton did not file the
    Renewal Application until March 15, 2004. We reserve the right to
    take any appropriate enforcement action against Sumiton for this and
    any other matters involving the Station, including the issuance of a
    Notice of Apparent Liability for Forfeiture.

[^11]: Renewal Application, Exhibit 6.

[^12]: The July 1, 2002, letter was addressed to the nonexistent "AM
    Broadcasting Bureau" and the June 16, 2003, letter was addressed to
    "Room 1-C807."

[^13]: *See Letter to Mark Chapman*, Ref. No. 1800B-MAT (MB May 19,
    2005).

[^14]: Response Letter at 3. The Commission has no record of receipt of
    any "lease-purchase agreement" or local marketing agreement ("LMA")
    between Sumiton and American Trust Corporation. Sumiton is hereby
    directed to submit copies of any agreement(s) between the parties
    relating to the operation of WRSM(AM).

[^15]: 47 U.S.C. § 312(g).

[^16]: *Id*.

[^17]: *See, e.g., Radio Station WOW, Inc. v. Johnson*, 326 U.S. 120,
    132 (1945) (where the Commission's public interest responsibility in
    licensing broadcast stations can be protected, the principal of fair
    accommodation between state and federal authority should be
    observed).

[^18]: *See, e.g., O.D.T. International*, 9 FCC Rcd 2575, 2576 (1994)
    (Commission must reconcile its rules and policies with federal and
    state court mandates designed to protect creditors).

[^19]: Circuit Court Order at 1-2.

[^20]: *Cf.* *Letter to Mr. Zacarias Serrato*, 20 FCC Rcd 17232 (MB
    2005) (license reinstatement not warranted for station off the air
    for more than three years "essentially due to a business decision"
    by the licensee).

[^21]: The Renewal Application had previously been accepted for filing
    by public notice released March 19, 2004. *Broadcast*
    *Applications*, Report No. 25696, Public Notice (MB Mar. 19, 2004).
    The Assignment Application had previously been accepted for filing
    by public notice released January 26, 2005. *Broadcast*
    *Applications*, Report No. 25908, Public Notice (MB Jan. 26, 2005).

[^22]: *See* 47 C.F.R. § 73.3584(a).

[^23]: *See* 47 C.F.R. § 73.3516(e).

[^24]: *See* 47 C.F.R. § 73.3580(d)(4)(ii).