In a ruling against a Las Vegas television station owned by a media conglomerate, the Supreme Court yesterday refused to disturb the loss of a broadcast license based on fraudulent billing of the National Broadcasting Co.
The case involved KORK-TV, owned by one of the approximately 25 companies in Donrey Inc.'s Donrey Media Group. In turn, the parent corporation, which operates daily and weekly newspapers, cable TV systems, radio and TV stations, and outdoor advertising firms in eight western and south-western states, is owned by Donald W. Reynolds.
The case concerns the three-year licensing period ended Sept. 30, 1971, in which KORK, under its contract with NBC, was forbidden to bill the network for national commercials that weren't actually broadcast.
During 28 weeks of that period,according to Las Vegas Valley Broadcasting Co., an applicant for KORK's license, a study showed that the station "clipped" NBC commercials or programs more than 500 times by turning out the network early, about 200 times by tuning-in late, and about 500 times by truncating network materials at mid-program breaks.
In a separate study, the Federal Communications Commission's Broadcast Bureau found 41 late joinings ranging in duration from 7 to 30 seconds, and 14 mid-program local premptions of 20 to 50 seconds.
The station maintained that it only clipped "clutter."
At the FCC in 1974, however, Administrative Law Judge Chester F. Naumowicz Jr. ruled that, in violation of commission rules KORK had concealed the cuts in its weekly reports to the network, had billed NBC for deleted commercials for which the station had substituted local ones and also had made misrepresentations to the commission.
Such double-dipping was "common," Naumowicz said. And, he added, "The record indicates that higher echelons did have at least tacit knowledge of this practice." He recommended that its license not be renewed.
Two years ago, the commission agreed, saying that company officers either "knew or should have known that the network reports submitted to NBC were patently false."
Last October, the U.S. Court of Appeals here upheld the commission as to KORK, but ordered new FCC proceedings as to the agency's denial of a license to Las Vegas Valley on the ground that it was finally unqualitfied. The Supreme Court left the decision standing.
Sugar Antitrust Case
In 1975, more than 100 antitrust suits in which states, local governments and private business sought triple damages from major producers of refined sugar and a sugar trade association were consolidated in U.S. District Court in San Francisco.
The State of California and a consumer, saying she represented all persons who bought sugar at retail, each sought to sue independently in state courts under state law. Judge George H. Boldt ruled by they couldn't but was overruled by the 9th U.S. Circuit Court of Appeals. The decision was left standing by the Supreme Court yesterday.