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If you need the complete document, download the WordPerfect version or Adobe Acrobat version, if available. ***************************************************************** Before the Federal Communications Commission Washington, D.C. 20554 In re Complaint of ) ) Paxson Denver License, Inc. ) ) vs. ) CSR-5201-M ) Galaxy Telecom, L.P. ) ) Request for Carriage of KPXC-TV ) MEMORANDUM OPINION AND ORDER Adopted: May 6, 1998 Released: May 11, 1998 By the Chief, Consumer Protection and Competition Division, Cable Services Bureau: INTRODUCTION 1. Paxson Denver License, Inc. ("Paxson"), licensee of television broadcast station KPXC-TV (formerly WQHB(TV)), Denver, Colorado, has filed a must-carry complaint requesting that the Commission order Galaxy Telecom, L.P. ("Galaxy"), operator of cable television systems serving Lyons, Colorado, and portions of Larimer County, Colorado ("the Communities"), to commence carriage of KPXC-TV. Galaxy filed an opposition, and Paxson filed a reply. BACK GROUND 2. Pursuant to Section 614 of the Communications Act and implementing rules adopted by the Commission in its Report and Order in MM Docket 92-259, commercial television broadcast stations are entitled to assert mandatory carriage rights on cable systems located within the station's market. A station's market for this purpose is its "area of dominant influence," or ADI, as defined by the Arbitron audience research organization. An ADI is a geographic market designation that defines each television market exclusive of others, based on measured viewing. 3. Under the Commission's must-carry rules, cable operators have the burden of showing that a commercial station that is located in the same television market is not entitled to carriage. One method of doing so is for a cable operator to establish that a subject television station's signal, which would otherwise be entitled to carriage, does not provide a good quality signal to a cable system's principal headend. Should a station fail to provide the requisite over-the-air signal quality to a cable system's principal headend, it still may obtain carriage rights because under our rules a station may provide a cable operator with specialized equipment, at the station's expense, which will improve the station's signal to an acceptable quality at a cable system's principal headend. 4. Television stations must follow the schedules set out in Section 76.64(f) of our rules for making mandatory elections for must carry status. Section 76.61(a) of the rules provides that a television station that believes a cable operator has failed to meet its carriage obligations shall notify the cable operator in writing of the alleged failure and identify its reasons for believing the operator is obligated to carry the station's signal. The rule provides the cable operator thirty days in which to provide notice to the station of a refusal of carriage and a statement of the basis for such refusal. The rule further provides that in case of a denial of carriage or absence of a response from the operator the station may file a complaint with the Commission pursuant to the must carry complaint procedures provided in Section 76.7 of the rules. Section 76.7 provides deadlines for the filing of Section 76.61 complaints and cable system responses to such complaints. MARKET FACTS AND ARGUMENT 5. Paxson's complaint states that by letters dated October 27, 1997, requests were made for carriage of KPXC-TV on Galaxy's cable systems. Paxson states further that the letters informed Galaxy that KPXC-TV was entitled to carriage and that the station delivers a quality signal to the principal headends of the cable systems. Paxson states further that the letters informed Galaxy of its commitment, in the event it should be shown that a quality signal is not delivered, to purchasing and installing the requisite equipment necessary to ensure delivery of a good quality signal. Paxson contends that Galaxy was obligated under Section 76.61(a)(2) of the Commission's rules to respond to the requests within thirty days of receipt of the letters. Paxson asserts that Galaxy neither responded to the requests nor added KPXC-TV to the cable systems' line up. Paxson asserts further that the complaint was filed within sixty days of Galaxy's failure to respond and is therefore timely filed under Section 76.7(c)(4)(A) and (B) of the rules. 6. The complaint shows that television station KPXC-TV is located in Denver, Colorado and in the Denver ADI. Paxson asserts that the cable systems operated by Galaxy serving Lyons, Colorado, and portions of Larimer County, Colorado are also located in the Denver ADI, and that Galaxy's carriage of KPXC-TV will not cause any increase in Galaxy's copyright liability. Paxson argues therefore that KPXC-TV is a local television station qualified under the provisions of 47 C.F.R.  76.55(c) for carriage on Galaxy's cable systems, and asserts that KPXC-TV delivers a good quality signal to the headends of Galaxy's cable systems. Paxson contends that since it has committed to purchase the equipment necessary to ensure signal delivery to Galaxy's cable system headends, an order for carriage of KPXC-TV should be issued. 7. Galaxy contends in opposition that the complaint should be dismissed as untimely filed. Galaxy asserts that the complaint fails to disclose that Paxson had previously requested carriage on its cable system by letters dated September 30, 1996 or that those earlier must carry requests were denied by letters dated January 6, 1997. It argues that since the complaint was not filed until January 23, 1998, over 480 days after the September 1996 carriage requests were made and over a year after the January 1997 denials of those requests, the complaint is untimely filed and must be dismissed pursuant to Section 76.7(c)(4)(iii) and applicable precedent. In support of these contentions, Galaxy notes particularly the last sentence of the September 1996 letters asking for notification of any objections to "this mandatory carriage request." 8. Paxson opposes the dismissal request by asserting that its September 1996 letters were must carry election notices that made specific reference to Section 76.64(f) of the rules providing for must carry election notifications and were not must carry requests, as Galaxy contends. Paxson contends that, in Horizon we found letters virtually identical to Paxson's September 1996 letters to constitute must carry election notifications and not must carry requests that establish a must carry complaint filing deadline. Therefore, Paxson argues the similar September 1996 letters in this case did not establish any deadline for filing a must carry complaint. Paxson asserts further that Galaxy's January 1997 letters also may not be considered as denials of must carry triggering a complaint filing deadline. Paxson argues that the Commission made it clear in the Must Carry Order that cable operators may not unilaterally trigger the must carry complaint filing deadline. Paxson contends that requests for carriage of KPXC-TV were in fact made by its October 1997 letters, which made specific references to Section 614 of the Communications Act and rule Section 76.61 providing for must carry requests where a television station believes that a cable operator fails to meet its must carry obligations. Paxson argues that since the complaint was filed within sixty days from the date Galaxy was obligated to respond to the October 1997 must carry requests, the complaint is timely filed. Finally, Paxson contends that since Galaxy opposed the complaint only on the basis of the invalid procedural argument and did not contest any of its evidence establishing KPXC-TV as a local station, an order for carriage should be issued. DISCUSSION AND ANALYSIS 9. We find the complaint to be timely filed and conclude, based on information of record, including Paxson's commitment to purchase the requisite equipment necessary to ensure delivery of a good quality signal to Galaxy's cable system headends, that an order for carriage of KPXC-TV should be issued. As Paxson points out, in Horizon we found letters virtually identical to Paxson's September 1996 letters to constitute must carry election notifications pursuant to Section 76.64(f), and not must carry requests under Section 76.61 that trigger a must carry complaint filing deadline. Galaxy provided no basis for reaching a different result here. The request in the last sentence of these letters for notification of any objections does not justify construing these election letters as must carry requests. We believe that any ambiguity concerning the effects of these letters that may arise from that last sentence is removed by the specific statement in the letters that the station "elects mandatory carriage" and by the specific reference to Section 76.64(f) also contained in these letters. We also find that Galaxy apparently treated these letters as election notices under Section 76.64(f), because it did not respond to them within thirty days by means of a Section 76.61(b) notice of carriage refusal. 10. In this connection, the Commission, in the Must Carry Order, pointed out that the statutory requirement for notice to a cable operator of any failure to comply with its must carry obligations before a must carry complaint may be filed applies even if the cable operator first notifies the station of its intent not to carry the station. In other words, the prerequisite for the filing of a must carry complaint in this case was the submission by Paxson to Galaxy of a Section 76.61 must carry request. In this case, as of January 6, 1997 when Galaxy submitted its denial, no request for carriage of KPXC-TV was outstanding. On that record, we conclude that Galaxy's January 6, 1997 letter was not in response to any must carry request and therefore did not establish any must carry complaint filing deadline. However, Paxson did submit to Galaxy its requests for carriage of KPXC-TV on October 27, 1997 and filed its complaint on January 23, 1998 within ninety days thereafter. Therefore, the complaint was timely filed. 11. Galaxy defended against this must carry complaint solely in reliance on the rejected theory that the complaint was untimely filed. Galaxy therefore presented nothing to dispute Paxson's representations that television station KPXC-TV is located in Denver, Colorado and in the Denver ADI, that the cable systems operated by Galaxy serving Lyons, Colorado, and portions of Larimer County, Colorado are also located in the Denver ADI, or that Galaxy's carriage of KPXC-TV will not cause any increase in Galaxy's copyright liability. Based on these unchallenged representations, we find that KPXC- TV is a local television station qualified under the provisions of 47 C.F.R.  76.55(c) for carriage on Galaxy's cable systems, provided it delivers a good quality signal to the headends of Galaxy's cable systems. In this regard, we find also that Paxson has made a commitment to purchase the requisite equipment necessary to ensure signal delivery to Galaxy's cable system headends. Based on these findings, we conclude that an order for carriage of KPXC-TV should be issued. ORDERING CLAUSES 12. Accordingly, IT IS ORDERED, pursuant to Section 614 of the Communications Act of 1934, as amended (47 U.S.C. 534), that the complaint of Paxson Denver License, Inc. ("Paxson") IS GRANTED, and Galaxy Telecom, L.P. ("Galaxy") IS ORDERED to commence carriage of television station KPXC-TV on its cable systems serving Lyons, Colorado, and portions of Larimer County, Colorado within sixty (60) days after Paxson installs the equipment necessary to provide a good quality signal to Galaxy's cable system headends. 13. This action is taken pursuant to authority delegated under Section 0.321 of the Commission's Rules, 47 C.F.R.  0.321. FEDERAL COMMUNICATIONS COMMISSION Gary M. Laden Chief, Consumer Protection and Competition Division Cable Services Bureau