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TV Max dba Wavevision | FCC Forfeiture Notice | June 24, 2013

TV Max dba Wavevision | FCC Forfeiture Notice | June 24, 2013

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Published by cindy_george
The Federal Communications Commission approves a $2.25 million fine against Houston cable operator TV Max, which does business as Wavevision.
The Federal Communications Commission approves a $2.25 million fine against Houston cable operator TV Max, which does business as Wavevision.

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Published by: cindy_george on Jul 02, 2013
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02/27/2014

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Federal Communications CommissionFCC 13-86BeforetheFederal Communications CommissionWashington, D.C. 20554
In the Matter of TV Max, Inc.and Broadband Ventures Six, LLCd/b/a Wavevision, Thomas M. Balun, Eric Meltzer,and Richard Gomez,
et al.
))))))))))))))))MB Docket No. 12-113CSR No. 8623-CMB Docket No. 12-181CSR No. 8669-CMB Docket No. 12-222CSR No. 8694-CMB Docket No. 12-266CSR No. 8707-C NAL/Acct. No.: 201341410008FRN: 0009645938
NOTICE OF APPARENT LIABILITY FOR FORFEITUREAND ORDER Adopted: June24, 2013Released: June25, 2013
By theCommission:
I.INTRODUCTION
1.In this Notice of Apparent Liability For Forfeiture (“
 NAL
”)and Order, we find that TVMax, Inc.and Broadband Ventures Six, LLC (each d/b/a Wavevision),and certain of theiraffiliates,subsidiaries,other related entities,and their controlling parties,
1
apparently willfully and repeatedlyviolated Section 325 of the Communications Act of 1934, as amended (the “Act”), and Section 76.64 of the Commission’s rules, by retransmitting the signalsof sixtelevision broadcast stations(collectively, the“Stations”)
2
without “the express authority” of the originating stations.
3
Based upon the record beforeus,including complaints filed by the licensees of the Stations, we find TV Maxapparently liable for amonetary forfeiture in the amount of two million two hundred fifty thousand dollars ($2,250,000). Inaddition, we directTV Max, Inc.to submit, no later thanthirty (30) calendar daysfrom the release date of this NAL and Order,a statement signed under penalty of perjury by an officer or director of the companydescribing in detail the steps it has taken to immediately come into compliance with the requirements of 
1
Based upon the record before us, these entitiesand individualsinclude TV Max, Inc., TV Max, LP, TV MaxHouston, Inc., TV Max Holdings, Inc., TV Max Houston, LP, TV Max Houston GP, LLC, TV Max Corporate, Inc.,Broadband Ventures Group, LLC, Broadband Fiber, LLC, Broadband Ventures IV, LLC and Broadband VenturesSix, LLC, and their common controlling parties, Thomas M. Balun, Eric Meltzer and Richard Gomez. As discussed
 ,infra
, at paragraph9, the recordsupports treating these entitiesand individualsas one and the same.For purposes of simplicity, unless otherwise noted, they will collectively be referred to herein as “TV Max.”
2
The six stations involved are KTXH(TV), KRIV(TV), KXLN-DT, KFTH-DT, KPRC-TV, and KTRK-TV.
3
47 U.S.C. § 325(b)(1)(A); 47 C.F.R. § 76.64(a).
 
Federal Communications CommissionFCC 13-86
2Section 325 of the Act and Section 76.64 of the Commission’s rules.
4
II.BACKGROUND
2.TV Maxis a cable television operator that serves more than 10,000 subscribers in theHouston, Texas Designated Market Area (“DMA”),in 245 multiple-dwelling unit buildings (MDUs).
5
 Fox Television Holdings, Inc. (“FOX”), Univision Communications, Inc. (“Univision”), Post-Newsweek Stations, Houston, Inc. (“Post-Newsweek”) and ABC, Inc. (“ABC”) (collectively, the “Licensees”)arethe respective licensees of the Stations,
6
eachof which broadcastswithin the Houston, Texas DMA.
7
3.For the 2012-2014 carriage cycle,
8
each of the Licensees elected retransmission consentfor theirrespectivestation(s) with respect to the TV Maxcable system.
9
TV Maxpreviously hadin placeretransmission agreements with each of the Licensees, but its agreementswith FOX, Univision, and Post- Newsweek expired December 31, 2011, and its agreement with ABC expired March 2, 2012.
10
TV Maxcontinues tocarry the Stationsdespite the absence of an extension or renewal agreementwith them.
11
 The Licensees eachinformed TV Maxthat TV Maxwas not permitted to retransmit the Stationsbecausethe agreementshad either expiredor were terminated under the terms of the agreement.
12
The Licensees
4
See infra
 ¶¶ 19and 21.
5
See
,
e.g.
, Answer of TV Maxto Univision Complaint, MB Docket No. 12-181, dated Jul. 19, 2012, at 1-2.According to TV Max, itcurrently holds a cable television franchise with the City of Houston, TX.
 Id 
.
6
FOX is the parent company of the licensee of full-power television stations KTXH(TV) and KRIV(TV), Houston,TX. Univision is the parent company of the licensee of full-power television stations KXLN-DT, Rosenberg, TXand KFTH-DT, Alvin, TX. Post-Newsweek is the licensee of full-power television station KPRC-TV, Houston, TX.ABC is the parent company of the licensee of full-power television station KTRK-TV, Houston, TX.
7
See
FOX Complaint Concerning KTXH(TV) and KRIV(TV), Houston TX, MB Docket No. 12-113, CSR No.8623-C (dated Apr. 12, 2012) at 2 (“FOX Complaint”); Univision Complaint Concerning KXLN-DT, Rosenberg,TX and KFTH-DT, Alvin, TX, MB Docket No. 12-181, CSR No. 8669-C (dated Jun. 21, 2012) at 2 (“UnivisionComplaint”); Post-Newsweek Complaint Concerning KPRC-TV, Houston, TX, MB Docket No. 12-222, CSR No.8694-C (dated Jul. 31, 2012) at 2 (“Post-Newsweek Complaint”); ABC Complaint Concerning KTRK-TV, Houston,TX, MB Docket No. 12-266, CSR No. 8707-C (dated Sept. 5, 2012) at 2 (“ABC Complaint”).
8
Commercial television stations are required to make elections between retransmission consent and must-carrystatus at three yearintervals. 47 C.F.R. § 76.64(f).
9
See
FOX Complaint at Attachment 1, Exhibit A; Univision Complaint at Exhibit 1; Post-Newsweek Complaint atExhibit 1; ABC Complaint at Exhibit B.
10
See
FOX Complaint at 2; Univision Complaint at 2-3; Post-Newsweek Complaint at 2; ABC Complaint at 2-5.
11
See
FOX Complaint at 5; Univision Complaint at 2-3; Post-Newsweek Complaint at 4; ABC Complaint at 6.
Seealso
Letter of Eve R. Pogoriler, Covington & Burling (Univision counsel) dated Apr. 2, 2013; Letter of Jennifer A.Johnson, Covington & Burling (Post-Newsweek counsel) dated Apr. 2, 2013; Email of Tom W. Davidson, AkinGump Strauss Hauer & Feld LLP (ABC counsel) dated Apr. 2, 2013; Letter of Ellen S. Agress, FOX Senior VicePresident, dated Apr. 3, 2013;
and see
the Wavevisionchannel line-up shown at:http://www.wavevision.com/houston/channel-line-up(last visited June 21, 2013).
12
See
FOX Complaint at 3-5 and Attachments 3 and 4 (stating it sent letters to TV Maxboth before and after theagreement expired); Univision Complaint at 3 (stating Univision actually terminatedits agreement with TV Max based on an uncured material breach for failure to pay starting in mid-2010 and, after sending several default noticeletters over the course of 2011,by letter dated November 30, 2011 directed TV Maxto eitherpay the full amount odelinquent payments or to cease transmitting the stations effectiveDecember 3, 2011); Post-Newsweek Complaint at2 (stating it sent letters to TV Maxin January and March of 2012); ABC Complaint at 5 (stating it sent a letter to TVMaxin March 2012).
 
Federal Communications CommissionFCC 13-86
3each filed a complaint with the Commission alleging that TV Maxretransmitted without consent thesignals of one or more of its stations.
13
4.In response, TV Maxdoes not refute that it retransmitted the Stationswithouttheiexpress, written consent. Rather, TV Maxstates it decided to carry the Stations withoutthe Licenseesconsent, and withoutpaying retransmission consent fees,by invoking the master antenna television(MATV) exception to the retransmission consent requirementbecause all of its subscribers reside inMDUs.
14
Nevertheless, TV Maxadmits that it retransmitted,from its headend, the Stations’signalswithout retransmission consent before MATV systems on all of its MDU buildings were installed.
15
5.TV Maxstates that it began to convert all of its MDU buildings to MATV systemsin November 2011and had hoped to complete the installations before the first of the retransmission consentagreements expired on December 31, 2011.
16
TV Maxadmits, however, that no more than half of its 245MDU buildings had operational MATV systems as of January1, 2012.
17
TV Maxfurther concedes that ithad not installed MATV systems on at least 19 of its buildings as of July 19, 2012but nonethelesscontinued to retransmit the Stations’signals throughout this time period,
18
despite the filing ofcomplaints byFOX in Apriland Univision in June,and letters sent by each Licensee informing TV Maxit was not permitted to retransmit the Stations’signals.
19
OnJuly 26, 2012,TV Maxasserted that it had completedinstallation of MATV systems on all of its MDU buildings.
20
TV Maxacknowledged, however, that, as
13
See
FOX Complaint at 3-5and Attachments 3 and 4 (stating it sent letters to TV Maxboth before and after theagreement expired.”); Univision Complaint at 3 (stating it terminated its agreement with TV Maxeven before itsagreement was scheduled to expire because TV Maxfailed to make the required payments; Post-Newsweek Complaint at 2 (stating it sent letters to TV Maxin January and March of 2012); ABC Complaint at 5 (stating it senta letter to TV Maxin March 2012). The Licensees seek an order from the Commission directing TV Maxto complywith the law and to cease retransmitting the Stations without consent, as well as imposing appropriate sanctions for these willful, repeated and ongoing violations.
See
FOX Complaint at 1-2; Univision Complaint at 1-2; Post- Newsweek Complaint at 1-2; ABC Complaint at 1-2.
14
See
,
e.g.
, Response of TV Maxto FOX Complaint, dated May 1, 2012, at 5 (stating “this plan was formulated andimplemented for the specific purpose of qualifying TV Max’s MDU operations for exemption from retransmissionconsent fees”);47 C.F.R. § 76.64(e)). As discussed in more detail below, the MATV exceptionprovides thatretransmission consent requirements are not applicable to broadcast signals received by master antenna televisionfacilities under certain circumstances.
See
 ¶ 13,
infra
.
15
See
,
e.g.
, Surreply of TV Maxto FOXReply, dated May 25, 2012,at 3 (“TV Maxadmits to non-compliance withthe retransmission consent regime insofar as it had failed to install MATV systems at 100% of the MDU buildingsserved by the company at the time the prior retransmission consent agreement with Fox expired on December 31,2011.”).
See also
Answer of TV Maxto ABC Complaintat 2-3(statingthat its “failure to complete all [MATV]installations by January 1, 2012 was not attributable to lack of good faith efforts to comply with applicable laws andregulations”).
16
See
,
e.g.
, Answer of TV Maxto ABC Complaint, dated Sept. 24, 2012, at 2 (“TV Max’s management hoped andexpected to convert all MDU buildings to MATV systems by the time the ABC retransmission consent agreementexpired on December 31, 2011”).
17
TV MaxResponse to FOX Complaint at Attachment 1 (Balun Declaration) (“As of January 1, 2012, about 50% of the MDU buildings served by TV Maxhad been fully converted to MA TV systems. Currently [May 1, 2012],about 50% of the MDU buildings have been fully converted to MA TV systems.…”).
18
See
Letter of Carl E. Kandutsch,TV Maxcounsel,dated Jul. 18, 2012.
19
See supra
notes 13 and 14.
20
See
Email of Carl Kandutsch, TV Maxcounsel, dated Jul. 26, 2012 (“Kandutsch July 26 Email”) at 1 (stating “allMDU buildings served by TV Maxhave been equipped with MATV systems that are the property of the buildingowner.”).
Seealso
Answer of TV Max to ABC Complaint, dated Sept. 24, 2012, at 3.

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