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Bailey Cable TV, Inc. Notice of Apparent Liability for Forfeiture

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Released: March 16, 2012

Federal Communications Commission

DA 12-421

Before the

Federal Communications Commission

Washington, D.C. 20554

In the Matter of
)
)

Bailey Cable TV, Inc.

)
MB Docket No. 12-34
)
CSR No. 8584-C
)
NAL/Acct. No.: MB-201241410023
)
FRN: 0011409034

NOTICE OF APPARENT LIABILITY FOR FORFEITURE

Adopted: March 16, 2012

Released: March 16, 2012

By the Chief, Media Bureau:

I.

INTRODUCTION

1.
In this Notice of Apparent Liability For Forfeiture (“NAL”), we find that Bailey Cable
TV, Inc. (“Bailey”) apparently willfully and repeatedly violated Section 325 of the Communications Act
of 1934, as amended (the “Act”), and Section 76.64 of the Commission’s rules, by retransmitting the
signal of a broadcasting station without “the express authority” of the originating station.1 Based upon
our review of the facts, we find Bailey apparently liable for a monetary forfeiture in the amount of fifteen
thousand dollars ($15,000).

II.

BACKGROUND

2.
Communications Corporation of America (“ComCorp”) is the parent company of the
licensee of full-power television station WGMB-TV, Baton Rouge, Louisiana. ComCorp filed a
complaint with the Commission, alleging that Bailey retransmitted without consent the signal of WGMB-
TV on its cable system serving St. Francisville, Louisiana; Angola, Louisiana; and certain unincorporated
areas within West Feliciana Parish, Louisiana (the “Communities”).2
3.
Bailey’s cable system serving the Communities is a multichannel video programming
distributor (“MVPD”), and WGMB-TV is a broadcasting station within the Baton Rouge Designated
Market Area (“DMA”) served by Bailey.3 For the 2012-2014 carriage cycle, for the Bailey cable system
serving the Communities, ComCorp elected retransmission consent for WGMB-TV.4 Although Bailey’s
retransmission consent agreement with ComCorp expired on December 31, 2011, Bailey continued


1 47 U.S.C. § 325(b)(1)(A); 47 C.F.R. § 76.64(a).
2 See Enforcement Complaint Concerning WGMB-TV, Baton Rouge, Louisiana (dated Jan. 23, 2012) (“WGMB-TV
Complaint”). Concurrently with this NAL, we are issuing a Notice of Apparent Liability For Forfeiture pertaining to
a similar complaint filed by Knight Broadcasting of Baton Rouge License Corp. (“White Knight”), the licensee of
full-power television station WVLA-TV, Baton Rouge, Louisiana, against Bailey. See Enforcement Complaint
Concerning WVLA-TV, Baton Rouge, Louisiana (dated Jan. 25, 2012) (“WVLA-TV Complaint”). Bailey was
formerly known as Audubon Cablevision. See WVLA-TV Complaint at 1.
3 WGMB-TV Complaint at 2.
4 Id. at 2-3 and Ex. A.

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carrying WGMB-TV despite the absence of an extension or renewal agreement.5 ComCorp informed
Bailey, both before and after the expiration of the retransmission consent agreement, that Bailey was not
permitted to retransmit WGMB-TV once the agreement expired.6 ComCorp seeks an order directing
Bailey to comply with the law and imposing appropriate sanctions for its knowing, deliberate, and
continuing violations.7
4.
In response, Bailey does not refute that it retransmitted WGMB-TV without express,
written consent.8 Rather, Bailey argues that it faced a “dramatic increase” in requested retransmission
consent fees, and states that it receives the signal by antenna rather than satellite or the Internet.9 Bailey
claims that ComCorp is “using [the Commission] as a tool to negotiate a dramatic increase in rates” and it
requests that the Commission require the fair negotiation of a reasonable rate.10 On February 3, 2012,
following a telephone conference with Commission staff and the parties, Bailey and ComCorp executed
an agreement extending the term of their retransmission consent agreement.11

III.

DISCUSSION

5.
As described below, we conclude that Bailey is apparently liable for a forfeiture in the
amount of fifteen thousand dollars ($15,000) for its apparent willful and repeated retransmission of
WGMB-TV’s signal without the express authority of the originating station. Under Section 503(b)(1) of
the Act, any person who is determined by the Commission to have willfully or repeatedly failed to
comply with any provision of the Act or any rule, regulation, or order issued by the Commission shall be
liable to the United States for a forfeiture penalty.12 Section 312(f)(1) of the Act defines willful as “the
conscious and deliberate commission or omission of [any] act, irrespective of any intent to violate” the


5 Id. at 3. ComCorp claims that it “made every effort to extend the Agreement with Bailey, but Bailey refused to
engage in serious negotiations.” Id.
6 Id. at 3-4. ComCorp alleges that its designated negotiator contacted Bailey on December 30, 2011, “and advised it
that at midnight on December 31, 2011, the Agreement would expire and Bailey would no longer have authority to
retransmit the programming for WGMB-TV.” Id. at 3. On January 3, 2012, ComCorp faxed and e-mailed Bailey a
letter stating that its continuing carriage of WGMB-TV was in violation of federal law. Id. at 4 and Ex. C.
7 Id. at 1.
8 Bailey Cable TV, Inc. Answer to Enforcement Complaint Concerning WVLA-TV, Baton Rouge, Louisiana (dated
Jan. 30, 2012) (“Bailey Answer”). Bailey informed the Commission that it did not intend to file a separate answer to
the WGMB-TV Complaint, and that the same arguments would apply. During a telephone conference with
Commission staff, ComCorp and White Knight on February 3, 2012, Bailey made the same arguments with regard
to both stations. Accordingly, we will treat the Bailey Answer as pertaining to the WGMB-TV Complaint as well as
the WVLA-TV Complaint, for purposes of this NAL.
9 Id. at 1. Bailey also claims that it erroneously received a contract for the Hartford-New Haven area that covered
all broadcast networks. See id. at 1 and Ex. A. Given that the contract clearly labeled two fictitious stations in the
Hartford-New Haven DMA as examples, this argument fails. See id. at Ex. A.
10 See id. at 1.
11 See Letter from John R. Feore, Jr. and Robert J. Folliard, III, Counsel to Communications Corporation of
America, to Steven A. Broeckaert, Senior Deputy Chief, Policy Division, Media Bureau, at 1 (Feb. 28, 2012).
Bailey erroneously indicated that the date of the telephone conference was February 2, 2012. See Letter from David
A. Bailey, Bailey Cable TV, Inc., to Steven A. Broeckaert, Senior Deputy Chief, Policy Division, Media Bureau
(Feb. 27, 2012).
12 See 47 U.S.C. § 503(b)(1)(B); 47 C.F.R. § 1.80(a)(2).
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law.13 The legislative history to Section 312(f)(1) of the Act clarifies that this definition of willful applies
to both Sections 312 and 503(b) of the Act,14 and the Commission has so interpreted the term in the
Section 503(b) context.15 The Commission may also assess a forfeiture for violations that are merely
repeated and not willful.16 “Repeated” means that the act was committed or omitted more than once or
lasts more than one day.17 In order to impose a forfeiture, the Commission must issue a notice of apparent
liability, the notice must be received, and the person against whom the notice has been issued must have
an opportunity to show, in writing, why no such penalty should be imposed or why it should be reduced
and must include a detailed factual statement and pertinent documents and affidavits as support.18 The
Commission will then issue a forfeiture if it finds, by a preponderance of the evidence, that the person has
willfully or repeatedly violated the Act or a Commission rule.19
6.
Section 325 of the Act requires cable systems and other MVPDs to obtain “the express
authority of the originating station” to retransmit a broadcasting station’s signal.20 This requirement is
codified in Section 76.64 of the Commission’s rules, which further requires retransmission consent
agreements to be in writing and to “specify the extent of the consent being granted.”21 The Commission
previously stated that if an MVPD retransmits a television signal without consent, Commission
intervention would be consistent with precedent and “properly documented retransmission of a television
signal without consent would be grounds for imposition of a forfeiture.”22
7.
We find that Bailey apparently violated Section 325 of the Act and Section 76.64 of the
Commission’s rules by retransmitting WGMB-TV’s signal without the required consent. Bailey does not
dispute ComCorp’s allegations that it retransmitted WGMB-TV’s signal despite the expiration of the
retransmission consent agreement and the failure to enter into an extension or renewal agreement.23
Bailey objects to the increase in the retransmission consent fees requested by ComCorp,24 but such an
increase does not justify an MVPD’s retransmission of a broadcasting station’s signal without the
originating station’s express authority. We also find irrelevant to this matter Bailey’s statement that it


13 47 U.S.C. § 312(f)(1).
14 See H.R. Rep. No. 97-765, 97th Cong. 2d Sess. 51 (1982).
15 See, e.g., Southern California Broadcasting Co., Memorandum Opinion and Order, 6 FCC Rcd 4387, 4388
(1991).
16 See, e.g., Callais Cablevision, Inc., Grand Isle, Louisiana, Notice of Apparent Liability for Monetary Forfeiture,
16 FCC Rcd 1359, 1362, ¶ 10 (2001) (“Callais Cablevision, Inc.”) (issuing a Notice of Apparent Liability for, inter
alia
, a cable television operator’s repeated signal leakage).
17 Southern California Broadcasting Co., 6 FCC Rcd at 4388, ¶ 5; Callais Cablevision, Inc., 16 FCC Rcd at 1362, ¶
9.
18 See 47 U.S.C. § 503(b); 47 C.F.R. § 1.80(f).
19 See, e.g., SBC Communications, Inc., Forfeiture Order, 17 FCC Rcd 7589, 7591, ¶ 4 (2002) (forfeiture paid).
20 47 U.S.C. § 325(b)(1)(A). Although there are certain exceptions to this requirement, including for local
commercial stations that have elected to assert their mandatory carriage rights, no exceptions apply to the present
situation. See WGMB-TV Complaint at 2 n. 1; 47 U.S.C. §§ 325(b)(1)(B), 534(b).
21 47 C.F.R. § 76.64(a), (j).
22 Implementation of the Cable Television Consumer Protection and Competition Act of 1992, Broadcast Signal
Carriage Issues
, Report and Order, 8 FCC Rcd 2965, 3005, ¶ 175 (1993).
23 Bailey Answer.
24 See id. at 1.
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receives the signal “free over the air to antenna receivers.”25 We emphasize that the cable operator has
discretion to decide whether to enter into a retransmission consent agreement, but in the absence of such
an agreement, the Act and the Commission’s rules prohibit retransmission of the station’s signal.
Although ComCorp informed Bailey that its retransmission of WGMB-TV was a violation of federal
law,26 Bailey continued impermissibly retransmitting the station’s signal from January 1, 2012 until
February 3, 2012.
8.
Based upon the evidence before us, and in view of the applicable law and Commission
precedent, we find that Bailey apparently willfully and repeatedly violated Section 325 of the Act and
Section 76.64 of the Commission’s rules. The Commission’s Forfeiture Policy Statement and Section
1.80 of the Commission’s rules specify a base forfeiture amount of seven thousand five hundred dollars
($7,500) for each violation of the cable broadcast carriage rules.27 In assessing the monetary forfeiture
amount, we must take into account the statutory factors set forth in Section 503(b)(2)(E) of the Act and
Section 1.80 of the Commission’s rules,28 which include the nature, circumstances, extent, and gravity of
the violation, and with respect to the violator, the degree of culpability, any history of prior offenses,
ability to pay, and other such matters as justice may require.29 The base forfeiture amount for the present
matter would be calculated as follows:
$7,500 base forfeiture x 34 days = $255,000 total base forfeiture
During our investigation, Bailey submitted financial information which, after our review, establishes that
a $255,000 forfeiture would place the company in extreme financial hardship, and would represent a
significant percentage of Bailey’s gross revenues. Accordingly, we act within our discretion to reduce the
proposed forfeiture. With regard to an individual’s or entity’s inability to pay the forfeiture, the
Commission has determined that, in general, gross revenues are the best indicator of an inability to pay a
forfeiture.30 Having reviewed Bailey’s submitted documentation (including gross revenue figures), and
after applying the Forfeiture Policy Statement, Section 1.80 of the rules, and the statutory factors to the
instant case, we conclude that Bailey is apparently liable for a forfeiture in the amount of fifteen thousand
dollars ($15,000). We caution, however, that a party’s inability to pay is only one factor in our forfeiture
calculation analysis, and is not dispositive.31 We have previously rejected inability to pay claims in cases


25 See id.
26 WGMB-TV Complaint at 3-4 and Ex. C.
27 See The Commission’s Forfeiture Policy Statement and Amendment of Section 1.80 of the Rules to Incorporate the
Forfeiture Guidelines
, Report and Order, 12 FCC Rcd 17087, 17115 (1997), recons. denied 15 FCC Rcd 303 (1999)
(“Forfeiture Policy Statement”); 47 C.F.R. § 1.80(b).
28 See 47 U.S.C. § 503(b)(2)(E); 47 C.F.R § 1.80(b)(4).
29 See id.
30 See PJB Communications of Virginia, Inc., Forfeiture Order, 7 FCC Rcd 2088, 2089 (1992) (forfeiture not
deemed excessive where it represented approximately 2.02 percent of the violator’s gross revenues); Local Long
Distance, Inc.
, Forfeiture Order, 15 FCC Rcd 24385 (2000) (forfeiture not deemed excessive where it represented
approximately 7.9 percent of the violator’s gross revenues); Hoosier Broadcasting Corporation, Forfeiture Order,
15 FCC Rcd 8640 (2002) (forfeiture not deemed excessive where it represented approximately 7.6 percent of the
violator’s gross revenues).
31 See 47 U.S.C. § 503(b)(2)(E) (requiring Commission to take into account the nature, circumstances, extent, and
gravity of the violation and, with respect to the violator, the degree of culpability, any history of prior offenses,
ability to pay, and such other matters as justice may require).
4

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of repeated or otherwise egregious violations.32 Therefore, future violations of this kind may result in
significantly higher forfeitures that may not be reduced due to Bailey’s financial circumstances.

IV.

ORDERING CLAUSES

9.

ACCORDINGLY, IT IS ORDERED

, pursuant to Section 503(b) of the Act,33 and
Sections 0.61, 0.283, and 1.80 of the Commission’s rules,34 that Bailey Cable TV, Inc. is hereby

NOTIFIED

of its

APPARENT LIABILITY FOR FORFEITURE

in the amount of fifteen thousand
dollars ($15,000) for apparently willfully and repeatedly violating Section 325 of the Communications
Act of 1934, as amended, and Section 76.64 of the Commission’s rules.
10.

IT IS FURTHER ORDERED

, pursuant to Section 1.80 of the Commission’s rules, that
within thirty (30) days of the release of this NAL, Bailey Cable TV, Inc.

SHALL PAY

the full amount of
the proposed forfeiture or

SHALL FILE

a written statement seeking reduction or cancellation of the
proposed forfeiture, including a detailed factual statement in support of its request for reduction or
cancellation of the proposed forfeiture, and supported by pertinent documents and affidavits.
11.
Payment of the forfeiture must be made by check or similar instrument, payable to the
order of the Federal Communications Commission. The payment must include the NAL/Account number
and FRN referenced above. Payment by check or money order may be mailed to Federal
Communications Commission, P.O. Box 979088, St. Louis, MO 63197-9000. Payment by overnight mail
may be sent to U.S. Bank – Government Lockbox #979088, SL-MO-C2-GL, 1005 Convention Plaza, St.
Louis, Missouri 63101. Payment by wire transfer may be made to ABA Number 021030004, receiving
bank TREAS/NYC, and account number 27000001. For payment by credit card, an FCC Form 159
(Remittance Advice) must be submitted. When completing the FCC Form 159, enter the NAL/Account
number in block number 23A (call sign/other ID), and enter the letters “FORF” in block number 24A
(payment type code). Requests for payment of the full amount under an installment plan should be sent
to: Chief Financial Officer -- Financial Operations, Federal Communications Commission, 445 12th
Street, S.W., Room 1-A625, Washington, D.C. 20554. Please contact the Financial Operations Group
Help Desk at 1-877-480-3201 or Email: ARINQUIRIES@fcc.gov with any questions regarding payment
procedures. Bailey shall also send electronic notification on the date said payment is made to
Diana.Sokolow@fcc.gov.
12.
The response, if any, must be mailed to Diana Sokolow, Policy Division, Media Bureau,
Federal Communications Commission, 445 12th Street, SW, Washington, D.C. 20554, and

SHALL
INCLUDE

the NAL/Acct. number referenced above. In addition, to the extent practicable, a copy of the
response, if any, should also be transmitted via e-mail to Diana.Sokolow@fcc.gov.


32 Kevin W. Bondy, Forfeiture Order, 26 FCC Rcd 7840 (Enf. Bur., Western Region 2011) (holding that violator’s
repeated acts of malicious and intentional interference outweigh evidence concerning his ability to pay); Hodson
Broadcasting Corp
., Forfeiture Order, 24 FCC Rcd 13699 (Enf. Bur. 2009) (holding that permittee’s continued
operation at variance with its construction permit constituted an intentional and continuous violation, which
outweighed permittee’s evidence concerning its ability to pay the proposed forfeitures).
33 See 47 U.S.C. § 503(b).
34 See 47 C.F.R. §§ 0.61, 0.283, and 1.80.
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13.

IT IS FURTHER ORDERED

that the complaint in this proceeding

IS GRANTED

to
the extent indicated herein, and the complaint proceeding

IS HEREBY TERMINATED

.35
14.

IT IS FURTHER ORDERED

that a copy of this NAL shall be sent, by First Class Mail
and Certified Mail-Return Receipt Requested, to David A. Bailey, Bailey Cable TV, Inc., 807 Church
Street, Port Gibson, MS 39150.
FEDERAL COMMUNICATIONS COMMISSION
William T. Lake
Chief
Media Bureau


35 For purposes of the forfeiture proceeding initiated by this NAL, Bailey Cable TV, Inc. shall be the only party to
this proceeding.
6

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