RKO Appeals Revocation of Its Broadcast Licenses

RKO General Monday asked the Federal Communications Commission to reverse a decision revoking the company’s licenses to operate KHJ-TV Channel 9 in Los Angeles and 13 other television and radio stations across the country.

In a strongly worded appeal, RKO denounced the decision by an FCC administrative judge as one-sided, calling it “extraordinary in the number of its errors, both factual and legal, and in the extravagance of its rhetoric.”

In filing the appeal, which had been expected, company officials commented for the first time publicly on the August decision, in which Administrative Law Judge Edward J. Kuhlman had branded RKO a broadcaster of unprecedented dishonesty.

That decision “was based on allegations of misconduct that are either in error or have no bearing on our fitness as a broadcaster,” said A. William Reynolds, chairman and chief executive officer of GenCorp, RKO’s parent company.

The 95-page appeal raises objections to each of the main charges made by Kuhlman. It contends that RKO was wrongly criticized for destroying an audit report that was not in fact destroyed and for lack of candor in testimony in an episode in which the testimony was promptly corrected.

The appeal argues further that Kuhlman overemphasized RKO’s use of the wrong accounting system for reports that the FCC later discontinued as unnecessary, and also the overbilling of clients by RKO’s Radio Networks, which RKO itself uncovered and reported to the FCC.

Kuhlman’s recommendation that RKO’s license be revoked “constitutes an unprecedented penalty that is inappropriate to the facts,” Reynolds said.

GenCorp has been trying for more than two years to sell its broadcast stations, but revocation of its licenses nevertheless would be costly to the company because a licensed station is worth far more than the assets of a station alone.

In 1982, after it was stripped of a license on similar grounds, RKO sold the physical assets of its Boston TV station WNAC, a profitable CBS affiliate, for $24 million.

By comparison, RKO hopes to reap $217 million selling Channel 9 to Walt Disney Co.

In addition to KHJ-TV, RKO also owns radio stations KHJ-AM and KRTH-FM in Los Angeles; WOR and WRKS (FM) in New York; WRKO-AM and WROR-FM in Boston; WGMS-AM in Bethesda, Md.; WGMS-FM in Washington; KRFC-AM in San Francisco; WAXY-FM in Fort Lauderdale; WFYR-FM in Chicago; WHBQ-AM in Memphis and a Memphis television station, WHBQ-TV.