Three parties await ruling in KOCE case

Arguments hinge on whether station had to be sold for cash, whether televangelist’s offer was the highest responsible bid.SANTA ANA -- The fight over KOCE-TV continued Tuesday afternoon, as attorneys for three parties -- the Coast Community College District, the Daystar Television Network and the KOCE-TV Foundation -- sparred in appellate court.

During the hearing, which lasted slightly more than half an hour, the sides debated whether Daystar had bid responsibly for the public broadcasting station and whether the district had been legally mandated to accept cash-only bids. As the attorneys offered their statements inside, a crew from KOCE’s “Real Orange” news program waited outside with cameras -- filming a news story about the fate of their own station.

With the arguments completed, Judge David Sills said the case would be submitted for a ruling. A decision, barring the filing of more briefs, is expected within 60 days.

In their testimony, college district lawyer Milford Dahl and foundation lawyer Robert Dato argued that Daystar, an evangelical Christian network, had violated protocol by making a bid for KOCE under the name of a nonexistent entity.

Daystar filed its $25.1-million bid as the Community Television Educators of Orange County, a smaller group that it intended to create in the event of winning KOCE.

The district and foundation, both of whom oppose Daystar owning the station, argued that the network’s filing under a separate name made it an irresponsible bidder.

“It’s very clear that there’s nothing in the record to show that Daystar made a bid, and I don’t see why it should be here today,” Dahl told the judges.

However, Daystar attorney Richard Lloyd Sherman countered that the complaint was invalid and that it was common protocol for Daystar to create sub-entities for bidding. He cited testimony by Elliot Evers, the broker for the college district, who said previously in court that everyone involved knew that Daystar was behind the bid.

The true motive of the district, Sherman claimed, was not to acquire the most money from the sale but to keep KOCE as a public broadcasting station.

“This whole process had been corrupted from the start,” he told the court.

The two sides also disputed a phrase in the state Education Code, which states that a community college district “may sell for cash” any district property that is not required for school purposes. Daystar argued that the clause restricted bids to cash only, while the district and foundation said the word “may” loosened the requirement.

In November 2003, the district sold KOCE to the foundation, which made a $32-million bid consisting of $8 million cash and $24 million credit. Daystar, which made a $25.1-million cash bid, sued shortly afterward, claiming that its cash sum made it the highest responsible bidder.

The foundation currently owns the license to KOCE, despite an appellate court in June ruling in Daystar’s favor. In the current appeal case, Daystar’s attorneys are trying to transfer ownership of the station’s license to their client.

After the hearing, foundation chairman Bob Brown defended his organization’s bid.

“My understanding is that the KOCE-TV Foundation played by the book and there was no corruption involved,” he said. “I sleep well at night knowing that.”