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KOCE sale ruling upheld on appeal

State Supreme Court rejects transfer of county's public television station to fundraising arm.

August 23, 2006|By Michael Miller

The battle over KOCE-TV, Orange County's only public television station, may have reached its end this week, as the state Supreme Court upheld an earlier court decision that negated the sale of the station to its own fundraising foundation.

This spring, Orange County Appellate Judge David Sills ordered the KOCE sale voided and the station returned to the Coast Community College District, which sold it in 2004. Both the district and the KOCE-TV Foundation filed appeals after Sills' decision. On Monday, the Supreme Court rejected both of them.

As a result, attorneys said, the district must now regain KOCE from the foundation, which made an $8-million down payment and currently operates the station.

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"As far as we're concerned, the case is complete," said Bonnie LeSage, a deputy clerk for the Orange County Court of Appeals.

Milford Dahl, an attorney for the college district, was saddened but not surprised by the Supreme Court's ruling. Transferring ownership of the station back to the district, he said, would be a long and difficult process.

"It's going to affect hundreds of people and millions of dollars," Dahl said. "It's possible [to reverse the sale], but it's not that simple. If all we had to do is hand the license over and we hand them $10 million, that would be great, but that's not how it's going to work."

In 2003, the district put KOCE up for sale to raise academic funds, ultimately opting for the foundation's bid. The Daystar Television Network, a nationwide Christian broadcaster based in Texas, sued the district shortly before the sale was completed, accusing the district of wrongly slighting it in the bidding process. Daystar had bid $25.1 million in cash, while the foundation's bid consisted of $8 million in cash and $24 million in credit.

Daystar demanded that ownership of the station be transferred to it immediately. However, the appellate court merely declared the sale voided and said the district could choose whether to auction KOCE again. Richard Lloyd Sherman, one of Daystar's attorneys, said he held out hope that the network would eventually acquire KOCE.

"We haven't gotten justice yet, and we're still looking for justice," he said.

Dahl conceded that if the station went up for bidding again, Daystar would probably come up with the most money. In the meantime, the foundation and district will have to work out an arrangement to return the license. Dahl said that, among other things, the parties would need to work through employee contracts and a bank loan to the foundation, and contact the Federal Communications Commission to transfer the broadcasting license back.

Ardelle St. George, the general consul for the KOCE-TV Foundation, and Mel Rogers, the foundation's president, did not return calls seeking comment.

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