Infinity Could Lose Millions on FCC’s Delay of Radio Purchases : Broadcasting: Complaints against deejay Howard Stern have been cited. KRTH in Los Angeles is among deals pending.

Infinity Broadcasting Corp., the employer of radio shock jock Howard Stern, may start out the New Year several million dollars poorer because federal regulators, peeved at Stern’s controversial on-air remarks, have not yet approved Infinity’s purchase of three radio stations.

Although the Federal Communications Commission had set no timetable for reviewing the estimated $170 million in pending radio deals, failure to close the transactions before Sunday could cost Infinity several million dollars.

That’s because Infinity’s reported $110-million purchase agreement for the largest of the stations, KRTH-FM in Los Angeles, pegs the price to the station’s financial performance in the year of the deal. A deal in 1994 would open the door to an improved performance by the station and thus a higher price. Infinity shares fell $3 on Friday to close at $30.25 in Nasdaq trading.

Commissioner Andrew Barrett said the agency informally discussed the proposal about a week ago but has not acted because commissioners have been out of the city.

Nonetheless, Barrett and fellow Commissioners James H. Quello and Ervin S. Duggan have indicated they favor delaying the transactions until the FCC reviews at least two formal indecency complaints filed against Stern with the agency in recent months. FCC officials say the review could take weeks.

The commission’s new chairman, Reed E. Hundt, has removed himself, at least for now, from deciding whether to approve Infinity’s radio acquisitions because his former law firm, Latham & Watkins, has represented the company selling the Los Angeles station.

It is unclear how vigorously the FCC will pursue the indecency complaints, because the Clinton Administration has been championing less federal regulation of the industry.

New York-based Infinity, which with 20 stations is the nation’s third-largest broadcast holding company, has been under fire since 1990, when the FCC levied the first of what has grown into $1.2 million in fines. The fines were levied for purportedly indecent remarks Stern made on the air.

Stern has built a career on remarks about matters of race, ethnicity and sexuality that some critics say go beyond the bounds of good taste.

Stern once said, for example that he wanted to “strip and rape” male deejays at a Los Angeles radio station. He also drew the ire of commissioners when he said in 1992 that he hoped former FCC Commissioner Alfred E. Sikes’ prostate cancer would spread.

As offensive as Stern’s program is to some listeners, his commentary has been a hit with audiences in New York, Los Angeles, Philadelphia and several other large cities, and his provocative autobiography, “Private Parts,” has sold more than a million copies.

Although there are signs Stern has begun to tone down his radio remarks as a result of tighter monitoring by Infinity, the controversy he has ignited has focused new attention on the conflict between the right to free speech, which is guaranteed by the Constitution, and the legal responsibilities of broadcasters, who must obtain government-issued licenses to use the public airwaves.

The FCC has had the power to regulate indecent speech since a 1978 Supreme Court ruling that arose from on-air comedy routines by comedian George Carlin. But the agency rarely invoked that power until the mid-1980s, when Reagan Administration appointees initiated a crackdown.

But recent federal court decisions could curb the FCC’s power.

In November, for example, the U.S. Court of Appeals in Washington overturned FCC rules that prohibited radio or television stations from broadcasting sexually explicit material between 6 a.m. and midnight. The court ruled that the ban covered too many hours of the day.

The FCC has since adopted a policy of banning indecent material during hours when the greatest number of children might be expected to listen to radio, from 6 a.m. to 8 p.m.