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Petition for Reconsideration of RAAD Broadcasting Corporation denied.

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Released: March 19, 2013

Federal Communications Commission

Washington, D.C. 20554

March 19, 2013


DA 13-458

In Reply Refer to:
1800B3-CEG
Released: March 19, 2013
Christopher D. Imlay, Esq.
Booth, Freret, Imlay & Tepper, P.C.
14356 Cape May Road
Silver Spring, MD 20904
Anthony T. Lepore, Esq.
P.O. Box 823662
South Florida, FL 33082
Lewis J. Paper, Esq.
Pillsbury Winthrop Shaw Pittman LLP
2300 N Street NW
Washington, DC 20037
In re:

WTOK-FM, San Juan, Puerto Rico

Facility ID No. 4936
File No. BALH-20090206ACE

Petition for Reconsideration

Dear Counsel:
We have before us a Petition for Reconsideration (“Petition”) filed by RAAD Broadcasting
Corporation (“RAAD”)1 on July 18, 2012, seeking reconsideration of the grant of application for the
assignment of WTOK-FM, San Juan, Puerto Rico (the “Station”), from MSG Radio, Inc. (“MSG”) to WIAC-
FM, Inc. (“WFI”),2 and related pleadings.3 For the reasons stated below, we deny the Petition.

I. Background


Prior station transaction.

On August 20, 2007, Luis A. Mejia (“Mejia”) filed an application
seeking consent to assign the Station’s license to MSG (the “Mejia Application”).4 The Mejia
Application included a copy of an asset purchase agreement for the sale of the Station license, callsign,
and other intangibles to MSG. In September 2007, the Commission received two petitions to deny the
Mejia Application, alleging that Mejia and MSG had failed to file documents germane to the transaction.
Specifically, the petitioners provided purported copies of: (1) an asset purchase agreement dated August


1 RAAD is the licensee of station WXYX(FM), Bayamon, Puerto Rico, and the parent corporation of the licensees
of stations WXLX(FM), Lajas, Puerto Rico, and WELX(FM), Isabela, Puerto Rico.
2 MSG Radio, Inc. c/o Lewis J. Paper, Esq, et al., Letter, 27 FCC Rcd 7066 (MB June 20, 2012) (“Letter Decision”).
The parties consummated the transaction on September 21, 2012.
3 On August 17, 2012, MSG filed an Opposition to Petition for Reconsideration (“MSG Opposition”). On August
20, 2012, WFI filed an Opposition to Petition for Reconsideration (“WFI Opposition”). On August 31, 2012,
RAAD filed a Reply to each of the Oppositions (“MSG Reply” and “WFI Reply,” respectively).
4 File No. BALH-20070820AGE.

10, 2007 (“Bestov APA”), under which Bestov Broadcasting, Inc. of Puerto Rico (“Bestov”)5 would sell
the studio, office, and transmission facilities needed to operate the Station to Madifide, Inc., owned by
members of the Soto family (“Madifide”); and (2) an undated “Shared Services Agreement” (“SSA”)
between MSG and Madifide, allowing MSG access to the Station’s physical facilities but retaining
MSG’s responsibility for, inter alia, the Station’s personnel, programming, and finances (collectively, the
“Mejia Transactional Documents”). These documents, petitioners argued, reflected an unauthorized de
facto
transfer of control of the Station to Madifide.
On May 2, 2008, the Media Bureau (“Bureau”) sent a letter of inquiry (“LOI”) to Mejia, MSG,
and Madifide, requesting additional information to ascertain whether MSG would exercise a meaningful
degree of control over the Station.6 In response, the parties provided copies of the Bestov APA and SSA,
as well as a draft option agreement under which Madifide would acquire a two-year, irrevocable option to
purchase the Station license when qualified to do so under FCC rules and policies.7 On August 5, 2008,
the Bureau granted the Mejia Application.8 In doing so, it rejected petitioners’ argument that there had
been an unauthorized transfer of control of the Station; however, it imposed a forfeiture on the applicants
for failure to provide all required documents relevant to the Mejia Application.9

Present transaction.

On February 6, 2009, MSG filed the subject application (the “WFI
Application”), seeking consent to the assignment of the Station’s license to WFI, a Soto-owned entity.
Pursuant to the 2003 Ownership Order, a station located within an Arbitron Metro market must use that
Arbitron Metro as the relevant market for determining compliance with the Commission’s local numerical
ownership limits.10 In this case, station WTOK-FM is located within the Puerto Rico Arbitron Metro,
which encompasses the entire island of Puerto Rico. Absent a waiver, WFI would impermissibly own a
total of 15 stations in the Puerto Rico Arbitron Metro.11 Therefore, the WFI Application included a
request to waive the Arbitron Metro-based methodology and instead assess WFI’s compliance with the
multiple ownership rule using the alternative contour-overlap methodology, which is normally permitted
only when a station’s community of license is located in an unrated market, i.e., outside any Arbitron
Metro boundary.12


5 Mejia is the 100% shareholder of Bestov.
6 See Luis A. Mejia, et al., Letter, Ref. No. 1800B3-TSN (MB May 2, 2008).
7 Letter Decision at 2.
8 Luis A. Mejia, Memorandum Opinion and Order and Notice of Apparent Liability for Forfeiture, 23 FCC Rcd
11902 (MB 2008) (“Mejia Order”). The parties consummated the transaction on January 8, 2009. No party sought
reconsideration or review of the Mejia Application grant, which is now final. MSG filed a Request for Cancellation
of Proposed Forfeiture on September 4, 2008, which the Bureau considered and rejected. Luis A. Mejia, Forfeiture
Order, 23 FCC Rcd 15242 (MB 2008), recon denied, 26 FCC Rcd 11444 (MB 2011).
9 Mejia Order at 11905-6.
10 47 C.F.R. § 73.3555(a); 2002 Biennial Regulatory Review – Review of the Commission's Broadcast Ownership
Rules and Other Rules Adopted Pursuant to Section 202 of the Telecommunications Act of 1996
, Report and Order
and Notice of Proposed Rulemaking, 18 FCC Rcd 13620, 13724-6 (2003) (“Ownership Order”), aff'd in part and
remanded in part sub nom., Prometheus Radio Project v. FCC
, 373 F.3d 372 (2004), cert. denied, 545 U.S. 1123
(2005).
11 In a market with 45 or more stations, a party may have a cognizable interest in up to eight commercial stations, no
more than five in the same service. 47 C.F.R. § 73.3555(a).
12 See Ownership Order, 18 FCC Rcd at 13729.
2

On March 18, 2009, RAAD filed a Petition to Deny the WFI Application on two grounds.13 First,
RAAD alleged that the WFI Application was the final step in a scheme by which the Soto family would
warehouse the Station with MSG while retaining de facto control over its operations. RAAD’s argument
relied heavily on the Mejia Transactional Documents but added two new allegations, namely, that: (1) key
MSG employees had been previously employed by the Soto family; and (2) MSG had licensed the “Toca
de To” trademark from the Sotos. Second, RAAD argued that grant of WFI’s request for waiver would
lead to an undue concentration of market power in the hands of the Soto family, and that the
Commission’s prior decision to grant a similar waiver for station WMIO(FM), Cabo Rojo, Puerto Rico
(the “WMIO Waiver”), was made in error because it did not consider market realities and Puerto Rico’s
competitive environment.14
In the Letter Decision, the Bureau observed that RAAD’s de facto control argument was mainly
predicated on facts that were considered and rejected in the context of the Mejia Application.
Nonetheless, the Bureau re-examined RAAD’s argument in light of the “new, albeit scant, information . .
. i.e., allegations regarding use of common employees and a common trade name.”15 Accordingly, the
Bureau again reviewed the terms of the Mejia Transactional Documents, concluding, as before, that “it is
clear from the terms of the agreements that MSG has ultimate control over personnel and all
programming decisions and policies . . .”16 The Bureau further found that the fact that “some of the MSG
employees previously worked for companies owned by the Soto family . . . does not indicate an
abdication of control.”17 Lastly, the Bureau reasoned that the arms-length licensing agreement allowing
WFI to use the “Toca de To” trademark reinforces, rather than undermines, MSG’s claims of
independence from the Soto family. For these reasons, the Letter Decision dismissed RAAD’s de facto
transfer of control argument as “based on inferences, conjecture, and erroneous information.”18
As for WFI’s waiver request, the Bureau concluded that the “unique characteristics of Puerto Rico present
a compelling showing of special circumstances that warrant departing from the Arbitron Metro as the presumptive
definition of the local market . . ..”19 Specifically, the Bureau determined that Puerto Rico’s extreme mountainous
topography, large number of radio stations and station owners, and division into eight Metropolitan Statistical
Areas (“MSAs”) as defined by the Office of Management and Budget (“OMB”) all demonstrate that Puerto Rico
has more centers of economic activity than are accounted for by the single Puerto Rico Arbitron Metro. In this
respect, the Letter Decision found that WFI’s waiver request is “essentially identical” to the WMIO Waiver.20
Contrary to RAAD’s claims that it is impossible for stations to compete against the Sotos, the Bureau found that
many stations and owners in Puerto Rico do compete with the Sotos and will continue to do so. Therefore, the
Letter Decision granted WFI’s request to review the proposed acquisition by defining, for multiple ownership
purposes, the local radio market(s) in which the Station operates using the contour-overlap methodology.

Pleadings.

In its Petition, RAAD argues that the Bureau erred by ignoring prima facie evidence that there
was an unauthorized transfer of control of the Station in 2007 to an unspecified member of (or entity controlled by)


13 Letter Decision at 4.
14 Id.; See Luis A. Soto, Letter, 22 FCC Rcd 2549 (MB Feb. 9, 2007).
15 Letter Decision at 5.
16 Id. at 6.
17 Id.
18 Id.
19 Id. at 10.
20 Id. at 7.
3

the Soto family. According to RAAD, it is thus now “proper and timely”21 to revisit the facts surrounding the
2007 transfer because “the totality of the circumstances of this proposed assignment and the prior actions of the
parties . . . demonstrate a covert and conspiratorial plan . . . to covertly vest actual control of WTOK-FM in the
Sotos long before the grant of the [WFI] assignment application and the multiple ownership waiver.”22 RAAD
also reiterates that the “commercially unusually favorable”23 terms contained in the transactional documents, the
shared employees, and the “Toca de To” trademark combine to make a prima facie case that an unauthorized
transfer of control took place.24
With respect to the WTOK-FM Waiver, RAAD’s objections fall into four main lines of argument, as
follows:
1. Factual basis for waiver. RAAD argues that the WMIO and WTOK-FM Waivers ignore crucial facts
regarding competition in the Puerto Rican radio market. Specifically, RAAD contends that, although
there are 56 FM stations in Puerto Rico, 21 of these are noncommercial educational stations, and an
additional three are “limited in power and/or geography.”25 Of the remaining 32 stations, RAAD claims
that the “top three groups” now own 22 stations, or 69 percent.26 RAAD also contends that the Letter
Decision
draws the wrong conclusions from Puerto Rico’s topography, disregarding certain
“demographic facts,” such as driving mobility, that show a lack of social and economic differentiation
across the island.27 In such a unified market, according to RAAD, smaller station groups cannot compete
with large stations groups such as that owned by the Sotos, because they cannot offer the same island-
wide advertising packages.28 RAAD also alleges that, in contrast to the Bureau’s findings, station
WTOK-FM can be listened to in “both Ponce and in Aguadilla and everywhere in between”—excluding
only the southwest portion of the island.29
2. Delegated authority. According to RAAD, the Letter Decision constitutes a “rulemaking by waiver” that
exceeds the Bureau’s authority by prejudging the outcome of open docket proceedings that also address
Puerto Rican market definitions.30 In particular, RAAD refers to a 2003 petition for reconsideration of the
Ownership Order filed by ARSO Radio Corporation (“ARSO”) requesting a permanent exemption for


21 MSG Reply at 4.
22 Petition at 15.
23 Id. at 18.
24 Id. at 15-20. RAAD also argues that the same facts show a lack of candor and a violation of the disclosure
requirement of Section 1.65 of the Commission’s rules, 47 C.F.R. § 1.65. Id. at 20-21. RAAD does not develop the
candor/disclosure arguments further, and it appears that they pertain primarily to the Mejia Application, which is
now final. To the extent that these arguments apply to the WFI Application, they are resolved by our discussion
herein, supra at 7-10. Because we do not find that a violation of the transfer of control or multiple ownership rules
has occurred, we do not find a failure to disclose or lack of candor regarding the same.
25 Petition at 11.
26 Id. at 12. According to RAAD, these three groups are Uno Radio Group (controlled by the Sotos), SBS Spanish
Broadcasting Systems, and Univision Radio (both major U.S. broadcasters). Id. at 13, n.18.
27 Id. at 11-12.
28 Id. at 4, n.3, 12-13.
29 Id. at 11.
30 Id. at 8-9.
4

Puerto Rico from the Arbitron Metro-based methodology. Because the issue is the subject of a pending
rulemaking, RAAD argues, grant of the WTOK-FM Waiver is “premature.”31
3. Waiver standard and precedent. RAAD argues that WFI did not meet the waiver standard because it
failed to show that “it would work an unusual or undue hardship on the Sotos’ if they were to be held to
the same standard applicable to every other broadcaster in Puerto Rico.”32 RAAD further contends that
there are no “special circumstances that differentiate the Sotos from any other broadcasters in Puerto
Rico”33 and that waiver was based purely on “the alleged uniqueness of Puerto Rico’s topography. . ..”34
RAAD argues that the WMIO Waiver is inapposite precedent for the WTOK-FM Waiver, because
station WTOK-FM is a Class B station serving a significantly greater population, including the largest
economic center on the island (San Juan).35 RAAD also contends that—unlike the WTOK-FM
Waiver—the WMIO Waiver was “carefully conditioned upon the outcome of the multiple ownership
rulemaking proceedings”36 and that “the justification for the WMIO grant was specifically stated to be
inapplicable to a duopoly waiver for stations located in San Juan.”37 RAAD complains that WFI failed to
show that waiver implements Commission policy better than compliance with the rules or that
compliance with the rules would be inconsistent with the public interest.38 Rather, RAAD argues, “all
that [WFI] offered was an argument that the full Commission erred in adopting . . . the Arbitron market
definition.”39 Finally, RAAD contends that the Bureau failed to give the waiver the requisite “hard look,”
instead “merely parrot[ing] its own rationale used in the uncontested WMIO waiver proceeding.”40
4. Rule violation. RAAD argues that the WTOK-FM Waiver is “contrary to firmly established Commission
precedent [the Ownership Order], upheld on judicial appeal, which on its face makes grant of the instant
waiver unjustifiable.”41 According to RAAD, the WTOK-FM Waiver constitutes a “unilateral
abandonment by the Audio Division of the Commission’s recently established market definition in Puerto
Rico . . ..”42


31 Id. at 10.
32 Id. at 21; see also id. at 7.
33 Id. at 7.
34 Id. at 21. In a related point, RAAD argues that the WTOK-FM Waiver makes it “effectively impossible to deny
any future duopoly waivers for radio licenses in Puerto Rico . . . the Sotos will now have the unfettered ability to
restrain competition throughout the Island.” Id. at 4.
35 Id. at 5, 22. Station WTOK-FM is a Class B station with an ERP of 50 kW and 347 meters HAAT. Station
WMIO(FM) is a Class A station with 3 kW and 238 meters HAAT.
36 Id. at 8.
37 Id. at 22. We interpret RAAD’s arguments that refer to the “duopoly rule” or a “duopoly waiver” as referring to
the local radio ownership rule. The duopoly rule provides that one party may not own two television stations
licensed in the same Designated Market Area (DMA) unless certain conditions are present. 47 C.F.R. § 73.3555(b).
This rule does not apply to radio, which is governed by the local radio ownership rule, 47 C.F.R. § 73.3555(a).
38 Petition at 7, 22.
39 Id. at 22.
40 Id. at 7-8.
41 Id. at 10.
42 Id. at 5.
5

For these reasons, RAAD concludes that the Bureau’s grant of the WTOK-FM Waiver was an “arbitrary
and capricious” action.43
In its Opposition, MSG addresses only RAAD’s unauthorized transfer of control argument. MSG
contends that the Petition should be dismissed for failure to demonstrate that the Letter Decision contained a
material error or omission. MSG argues that RAAD “does nothing more than invoke the same facts and reiterate
the same arguments previously presented to the Bureau in its Petition to Deny” which in turn “relied almost
entirely on facts and arguments that the Bureau had considered and rejected in 2008 [in the Mejia Order].”44
RAAD’s allegations were fully considered and rejected in the Letter Decision, MSG concludes, and RAAD fails to
show any material error or omission in the Bureau’s analysis of the unauthorized transfer of control issue.45
WFI’s Opposition similarly argues RAAD fails to identify any material error or omission in the Letter
Decision or to raise additional facts not known or existing until after RAAD’s last opportunity to present such
matters.46 With respect to the waiver standard, WFI protests that it did demonstrate hardship “by clear and
convincing evidence” because the Arbitron Metro market definition would foreclose “economic opportunities that
other broadcasters in other, properly defined markets, were able to pursue.”47 WFI contends that the WTOK-FM
and WMIO Waivers are based on the same factual predicates: namely, (1) the “extreme topography” of the island,
which prevents stations on one side of the island from competing with stations on the other side; and (2) the
incongruity of including within a single Arbitron Metro eight MSAs and three Combined Statistical Areas.48
Lastly, WFI argues that the WTOK-FM Waiver, like the WMIO Waiver, is conditional, as it specifies that any
future application to change or increase station WTOK-FM’s technical facilities must be accompanied by a new
showing of compliance with the local radio ownership rules, including, if necessary, a new request for waiver.
WFI also challenges RAAD’s factual allegations, arguing that RAAD offers no support for its assertions
regarding: (1) the number of competing radio stations in Puerto Rico; (2) the “national” nature of the Puerto Rican
broadcast market; or (3) the inability of smaller broadcasters to compete with WFI.49 WFI contends that WFI’s
alleged market share of 26 percent—even if verified—is not problematic, pointing to a 2001 decision approving an
assignment that would result in an assignee having 48.8 percent share of a market’s advertising revenue. Finally,
WFI argues that RAAD includes other major Puerto Rico broadcasters in its competition analysis “for no readily
ascertainable reason other than to imply some sort of broadcast ‘cartel’…”50





43 Id. at 5, 11.
44 Id. at 2, 4.
45 Id. at 7-8.
46 WFI Opposition at 1-2, 7.
47 Id. at 6.
48 Id. at 5, 8. WFI also contends that the WTOK-FM Waiver confirms previous holdings in similar contexts that
Puerto Rico should be treated differently based on its “unique geographic issues.” Id. at 9.
49 Id. at 10-12. WFI argues that “[n]either BIA nor the Audio Division distinguish between commercial AM and
commercial FM stations in computing the number of stations in a market because ALL of them compete with each
other.” Id. (emphasis in original).
50 Id. at 13-14.
6

In its Reply to WFI, RAAD largely reiterates arguments made in the Petition, adding a discussion
justifying Arbitron’s designation of the Puerto Rico Metro as single market.51

II. Discussion

Reconsideration is warranted only if the petitioner shows an error of fact or law in the Commission’s
original order, or raises additional facts not known or existing at the time of the petitioner's last opportunity
to present such matters.52 RAAD has not met this burden.

Unauthorized transfer of control.

To determine whether there has been an unauthorized
transfer of control of a broadcast station in violation of Section 310(d) of the Act,53 the Commission looks
to see whether a party that is not the licensee exercises control over the programming, personnel, and
finances of the station.54 A licensee is permitted to delegate the day-to-day operations relating to these
three areas, so long as it continues to set the policies guiding those operations.55
RAAD’s primary argument on this point is that the Bureau failed to arrive at the correct
conclusion based on the totality of the facts before it.56 On reconsideration, RAAD does not adduce new
facts in support of this position but merely contradicts the conclusions of the Letter Decision.57 It is
axiomatic that reconsideration will not be granted merely for the purpose of again debating matters on
which the Commission has deliberated and spoken.58 The Letter Decision thoroughly addressed RAAD’s
contentions regarding unauthorized control and we will not do so again here. While properly refraining
from revisiting the 2008 Mejia transaction itself, now long final,59 the Bureau re-examined the Mejia
Transactional Documents as potentially relevant to current, or ongoing, unauthorized control of station
WTOK-FM, concluding that “[i]t is clear from the terms of the agreements that MSG has ultimate control
over personnel and all programming decisions and policies . . ..”60 The Letter Decision also separately
evaluated each of RAAD’s new allegations, finding that neither use of a Soto trademark nor employment


51 WFI Reply at 4-6.
52 See 47 C.F.R § 1.106(c) and (d); WWIZ, Inc., Memorandum Opinion and Order, 37 FCC 685, 686 (1964), aff'd
sub nom. Lorain Journal Co. v. FCC
, 351 F.2d 824 (D.C. Cir. 1965), cert. denied, 387 U.S. 967 (1966) (“WWIZ,
Inc.
”).
53 47 U.S.C. § 310(d).
54 See, e.g., Solar Broadcasting Company, Inc., Memorandum Opinion and Order, 17 FCC Rcd 5467, 5486 (2002);
WHDH, Inc., Memorandum Opinion and Order, 17 FCC 2d 856, 863 (1969) (subsequent history omitted).
55 See, e.g., WGPR, Inc., Memorandum Opinion and Order, 10 FCC Rcd 8140, 8142 (1995), vacated on other
grounds sub nom. Serafyn v. FCC
, 149 F.3d 1213 (D.C. Cir. 1998).
56 Petition at 15-16 (“The Division concluded that RAAD’s argument was based on inferences, conjecture, and
erroneous information. A review of the relevant facts, however, demonstrates otherwise.”)
57 47 C.F.R. § 1.106(c) (stating that a petition for reconsideration may rely on facts or arguments not previously
presented only if circumstances have changed, the facts were unknown to the petitioner and could not have been
discovered through the exercise of ordinary diligence, or consideration of the facts or argument is in the public
interest).
58 WWIZ, Inc., 37 FCC at 686.
59 Letter Decision at 5.
60 Id. at 6.
7

of former Soto employees evidences unauthorized control of the Station.61 Finally, the Letter Decision
examined all of the facts collectively, concluding that the whole is not greater than the sum of its parts:
“[H]aving reviewed the agreements and the entire record before us, we reject RAAD’s first argument that
MSG and the Soto family engaged in an unauthorized transfer of control.”62 By merely reiterating facts
and arguments that were before the Bureau at the time of the Letter Decision while urging a different
result, RAAD manifestly fails to meet the reconsideration standard with respect to the alleged
unauthorized transfer of control of station WTOK-FM.

Waiver.

The Commission's rules may be waived only for good cause shown.63 The Commission
must give waiver requests “a hard look,” but an applicant for waiver “faces a high hurdle even at the
starting gate”64 and must support its waiver request with a compelling showing.65 Waiver is appropriate
only if both (1) special circumstances warrant a deviation from the general rule, and (2) such deviation
better serves the public interest.66 In this case, RAAD has not shown that the Letter Decision misapplies
the waiver standard.
Factual basis for waiver. We disagree with RAAD’s contention that the Bureau arbitrarily or
capriciously ignored facts or arguments before it regarding broadcast competition in Puerto Rico.
“Market realities and Puerto Rico’s competitive environment” are thoroughly deliberated upon and
decided in the Letter Decision, which devotes no fewer than six paragraphs to the subject.67 The facts
cited in the Petition in furtherance of RAAD’s waiver arguments were either before the Bureau at the time
of the Letter Decision or could have been discovered through the exercise of ordinary diligence.68
Accordingly, we do not revisit the factual basis for the Letter Decision’s conclusions regarding broadcast
competition in Puerto Rico, nor do we entertain RAAD’s arguments on this point, upon which we have
already deliberated and spoken.69
Delegated authority. RAAD argues that the “fundamental error” of law in the Letter Decision is
that the same issues raised by WFI’s waiver request are being addressed in “still-open” dockets.70 The
WTOK-FM Waiver, according to RAAD, thus constitutes an impermissible “rulemaking by waiver.”71
However, the ARSO petition for reconsideration of the 2002 Biennial Ownership Order was dismissed in
the 2006 quadrennial broadcast ownership proceeding, and, to date, the Commission has not yet initiated


61 Id.
62 Id. at 7 (emphasis added).
63 47 C.F.R. § 1.3.
64 WAIT Radio v. FCC, 418 F.2d 1153, 1157 (D.C. Cir. 1969) (“WAIT Radio”) (subsequent history omitted).
65 Greater Media Radio Co., Inc., Memorandum Opinion and Order, 15 FCC Rcd 7090 (1999) (citing Stoner
Broadcasting System, Inc.
, Memorandum Opinion and Order, 49 FCC 2d 1011, 1012 (1974)).
66 NetworkIP, LLC v. FCC, 548 F.3d 116, 125-128 (D.C. Cir. 2008); Northeast Cellular, 897 F.2d at 1166.
67 Id. at 7-10.
68 47 C.F.R. § 1.106(c).
69 WWIZ, Inc., 37 FCC at 686.
70 WFI Reply at 3.
71 Petition at 8.
8

a rulemaking proceeding specifically addressing the Puerto Rico market definition methodology.72
Therefore, there is no open Commission docket concerning market definition in Puerto Rico. More
fundamentally, the Letter Decision is not an “agency statement . . . of future effect” such as would
constitute a rule under the Administrative Procedure Act.73 Therefore, the WTOK-FM Waiver in no way
prejudges the Commission’s ultimate disposition of the issues raised in ARSO’s petition for
reconsideration.74 Rather, the Letter Decision merely takes the requisite “hard look” at the particular facts
presented by WFI’s waiver request. Such a waiver, made on a case-specific basis, is well within the
scope of the Bureau's delegated authority.75
Waiver standard and precedent. RAAD’s various arguments that the Bureau erred by
misapplying the waiver standard in this case are unavailing. First, WFI was not required to show
individualized hardship, as RAAD contends. When considering a waiver request, the Commission may
take into account considerations of hardship, equity, or more effective implementation of overall policy.76
In the Letter Decision, the Bureau found that Puerto Rico’s unique characteristics—mountainous
topography, large numbers of radio stations and radio owners, and multiple MSAs—demonstrate that the
island contains multiple local radio markets.77 Because the purpose of the multiple ownership rules is to
“preserve a healthy and robust competition” among broadcasters in each local market,78 it is in the public
interest to define that market as rationally as possible.79 The Commission has stated that, in most cases,
the Arbitron Metro-based methodology achieves that purpose.80 In this particular case, however, because
the Puerto Rico Arbitron Metro designation fails to adequately capture market realities, the policy goal of
accurate market definition is better met by permitting use of the contour-overlap methodology. No
separate showing of individual hardship was therefore necessary to justify grant of the waiver.
Second, while an applicant for waiver must show “special circumstances,” those circumstances
need not be unique to the applicant, as RAAD contends.81 Other licensees may have similar special


72 2006 Quadrennial Regulatory Review – Review of the Commission's Broadcast Ownership Rules and Other
Rules Adopted Pursuant to Section 202 of the Telecommunications Act of 1996,
Report and Order and Order on
Reconsideration, 23 FCC Rcd 2010, n.427 (2008) (“We have granted ARSO’s waiver request to use the interim
contour-overlap methodology pending the outcome of its Petition, which will be resolved in a separate proceeding.
Therefore, we dismiss ARSO’s petition in this proceeding.”) (internal citations omitted).
73 5 U.S.C. § 551(4). The Letter Decision is an order adjudicating an individual licensing matter. Id. § 551(6)-(8).
74 The Letter Decision also makes clear that any future application by WFI to change or increase station WTOK-
FM’s technical facilities must be accompanied by a new showing of compliance with the local radio ownership rules
and, if necessary, a new request for waiver of the use of the Arbitron Puerto Rico Metro as the presumptive market
in which station WTOK-FM competes. Letter Decision at n. 4; See also 47 C.F.R. § 73.3555, n.4.
75 47 C.F.R. § 0.283.
76 WAIT Radio, 418 F.2d at 1159; Northeast Cellular, 897 F.2d at 1166.
77 Letter Decision at 8-9. Because the Bureau explicitly based its holding on these multiple facts, we disagree with
RAAD’s contention that “all [WFI] offered was an argument that the full Commission erred in adopting . . . the
Arbitron market definition.” See Petition at 22.
78 Ownership Order at 13623.
79 See id. at 13724-5.
80 Id. at 13813.
81 Petition at 7 (arguing that WFI has failed to distinguish itself from “any other broadcasters in Puerto Rico”).
9

circumstances warranting waiver.82 In fact, it is common and appropriate practice for staff to analyze a
waiver request in part by comparing it to similar cases, although each request is ultimately decided on its
own merits. Conversely, because each waiver request is evaluated on a case-by-case basis, factual
differences between stations WMIO(FM) and WTOK-FM do not militate against waiver for station
WTOK-FM. We also disagree with RAAD’s contention that the justification for the WMIO Waiver is
expressly inapplicable to any San Juan station. Rather, the WMIO Waiver was based (in part) on station
WMIO(FM)’s distance from San Juan, just as the WTOK-FM Waiver is based (in part) on station
WTOK-FM’s distance from the western portions of the island. The relevant factor in each case is that the
station could not reach or compete in certain parts of the island, thus indicating the existence of multiple
radio markets.
Rule violation. RAAD contends that the WTOK-FM Waiver is “contrary to firmly established
Commission precedent,”83 constituting an “abandonment. . . of the Commission’s recently established
market definition . . .”84 RAAD’s argument boils down to an observation that, in the absence of a waiver,
the proposed transaction would inevitably violate the Commission’s rules. We have long rejected such
tautological objections to waiver requests and do so again here.85

III. Conclusion

/

Actions

.
We find that grant of the WFI Application was not in error and was consistent with the public
interest, convenience, and necessity. Accordingly, IT IS ORDERED that RAAD’s Petition for
Reconsideration IS DENIED.
Sincerely,
Peter H. Doyle
Chief, Audio Division
Media Bureau


82 On this point, we note that the Letter Decision requires WFI to satisfy the numerical limitations of Section
73.3555(a)(1)(iii); i.e., WFI may not have a cognizable interest in more than eight commercial stations, no more
than five in the same service. Our waiver merely permits the pre-2003 market definition methodology—contour-
overlap analysis—to be used instead of the Arbitron Metro-based methodology when determining such compliance.
Thus WFI does not have an “unfettered ability to restrain competition,” as alleged by RAAD, but is constrained by
the numerical limits of our local radio ownership rule.
83 Petition at 5.
84 Id. at 10.
85 WAIT Radio, 418 F.2d at 1158 (“The very essence of waiver is the assumed validity of the general rule, and also
the applicant's violation unless waiver is granted.”).
10

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