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Three months ago, we wrote about a case where the FCC held that it would grant only one application from each MX Group in the recent NCE FM window for new noncommercial FM radio stations.  MX Groups arise when multiple applicants file applications that cannot all be granted without prohibited interference.  In some cases, an MX Group can span several states, where not all applications are mutually exclusive with each other, but all are tied together in a chain, with each link being mutually exclusive with the next link.  The FCC has just released another decision, slightly refining the decision from March.  In the new case, the FCC dismissed one applicant on essentially the same grounds as in the case from March - the only reason that the dismissed application could stand on its own was because other applications with which it was mutually exclusive were themselves dismissed because of the application that was to be granted as a result of the FCC decision selecting the preferred application in the MX Group.  However, in the new case, the FCC did allow for the grant of a second application in the same MX Group, where that application was no longer mutually exclusive with the winner or with other dismissed applications because its mutually exclusivity with the chain of application was broken by the voluntary dismissal of another applicant and the settlement with yet a third.  Because of these two actions, the FCC said that this application was not in the same circumstances as was the application whose dismissal was upheld.

What this case seems to say is that, even after a 307B) grant order is released by the FCC, another application in an MX Group can possibly be granted if it is made grantable before the official dismissal is released, not by the dismissal of applications that are only dismissed because they lost the FCC comparative analysis, but if the actions eliminating the mutual exclusivity were caused by other voluntary actions.  A slim exception - but one that NCE applicants in MX Groups where they are not technically precluded by the grant of the winning application may want to explore if they do not prevail in an FCC 307(b) analysis. 

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Last week, we wrote about a Commission decision that said that only one application in a noncommercial MX Group can be granted even if, when the first is granted, there are other applications in that group that would not be mutually exclusive with (i.e. would not create any prohibited interference to) the winning applicant.  While multiple applicants can be granted out of an MX Group if there is a settlement, only one application will be granted when the point system analysis is performed. Well - if you have an application still pending in the 2007 NCE Window and were contemplating a settlement, now is the time to do it.  In February, the Commission released an order deciding the winner in 59 different MX groups.  A second such decision is now circulating among the Commissioners for approval, and we hear that a third will soon follow as the FCC accelerates its review of the remaining applications from the 2007 window. Once these orders are released by the Commission, there is no more chance to settle any case decided in such an order, and thus only one application from any group will be granted.  So, if you are planning a settlement, do it now.

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In a recent decision, the FCC upheld the dismissal of a noncommercial FM application filed during the 2007 NCE FM window, despite the fact that the application was not mutually exclusive with any other pending application. This somewhat unusual result came about following the selection of a winner from among a group of mutually exclusive noncommercial applications. That group of mutually exclusive applicants (or, as the FCC calls it, an “MX Group”) contained a number of applications in a “daisy chain.”   As an example, a daisy chain would be where Applicant A was mutually exclusive with Applicant B, and Applicant B was mutually exclusive with Applicant C, and Applicant C was mutually exclusive with Applicant D, but Applicants C and A were not themselves mutually exclusive.  In the case decided last week, there were actually 13 applications in the chain.  When the FCC used its point system for evaluating noncommercial applications, it selected a winner and dismissed all of the remaining applicants.  One of those dismissed applicants, The Helpline, asked the FCC to reconsider the dismissal of its application, arguing that, when you dismissed all of the applications that were mutually exclusive with the winning applicant, the technical facilities proposed by the Helpline would no longer be mutually exclusive with any application and thus could be granted as well. The FCC denied that request.

Why was that request denied? In its order establishing the rules governing the processing of noncommercial FM applications in the 2007 NCE window, the FCC decided that it would grant only one application out of any MX Group, even where not all of the applications in that group were mutually exclusive with each other. According to last week's order, the Commission considered allowing the grant of more than one applicant in a group, but determined that doing so could lead to the grant of an application that is “inferior” to other applications, and which would not necessarily represent the best use of the spectrum, so they decided to grant only one applicant from each MX Group.

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The FCC's staff today issued an Order resolving 26 Groups of mutually exclusive FM applications submitted last year in the filing window for new noncommercial FM stations. We wrote about a previous order in August, processing a smaller group of such applicants.  In each of these groups, the Commission analyzed the coverage proposed by the applicants to determine if the technical service that they propose to provide was superior to that of other applicants - a "fair distribution analysis."  In these cases, the Commission found that one applicant was preferred under an analysis that looks at the populations to be served by these applicants that do not already currently receive service from more than one noncommercial station.  The "tentative selectees" of the Commission are now subject to the filing of petitions to deny and, if no petitions are filed in the 30 day filing window, these applications will be granted. 

This Order did not deal with cases where there was no dispositive preference based on coverage - cases where the FCC will have to conduct a "points system" analysis (see our summary of those factors here).  Presumably, those will come later.  For parties who had applications on the Order and who were not winners, a review of the decision is in order.  The Commission has been known to make mistakes in this kind of analysis and, as much reliance is put on information supplied by applicants, some of the information may not be correct, or may not rely on consistent assumptions applied in the same way in counting the populations served by each applicant.  We've heard that there may be some of these windows where the winning applicant ignored (or asked for a waiver of) the limitations on the power of noncommercial stations near Channel 6 TV stations, on the theory that most of these TV stations, operating adjacent to the FM band, will be going away in February after the digital television conversion.  This is a controversial issue (see our post here on the Commission's action with respect to applications to improve existing stations that relied on the same assumptions), which may well be challenged in reconsideration filings if these rumors are true.  So, as always, stay tuned to see how this process develops. 

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