The Federal Communications Commission yesterday granted RKO General Inc. permission to continue operating its Boston television station, WNAC-TV, pending RKO's appeal to the Supreme Court of an FCC decision stripping RKO of its right to operate the station.
However, by a unanimous decision after a closed-door session, the commission said that any profits earned from the station's operations past March 7 must go into an escrow account. If the high court rules against RKO, the funds in that account must be given to a charity of RKO's choice.
RKO previously said that if it lost the appeal, it would give the profits to nonprofit, public radio and television organizations--such as National Public Radio and the Public Broadcasting Service. Depending on how long it takes the Supreme Court to decide RKO's appeal, the escrow account could mean a substantial windfall for whatever charities are designated, considering that last year WNAC profits were $4.7 million.
The decision reaffirmed the FCC's commitment to strip RKO of its right to operate the Boston station. Two years ago the FCC found RKO unfit to own broadcasting licenses in Boston, Los Angeles and New York on the grounds that RKO and its parent company, General Tire & Rubber Co., engaged in extensive improper and illegal activities, including improper domestic political contributions, improper overseas payments and activities defrauding affiliate companies.
Late last year, the U.S. Court of Appeals upheld the FCC's decision in the Boston case, but ordered the FCC to hold further hearings on the New York and Los Angeles stations to ensure such drastic action was justified. Shortly after its decision, the appeals court turned down an RKO request for a stay, pending an appeal to the Supreme Court.
As a result, WNAC-TV was scheduled to shut down by March 7--unless the FCC intervened.
In granting an extension, FCC also approved a conditional construction permit to RKO's competitors--who have now merged together into New England Television Corp.--in the first step of granting them permission to operate on channel 7 should RKO lose its appeal. It was the petition by these rivals 13 years ago that prompted the FCC ruling against RKO in 1980.
The construction permit does not take effect until the Supreme Court completes the RKO case--which could be as soon as a month if the court denies RKO's petition to consider the case or could last as long as 18 months if the court decides to review RKO's petitlion.