Town of Galena, MD Article V Termination and Revocation of Franchise

§ 59-38 Forfeiture and termination.

A. In addition to all other rights and powers retained by the Town under applicable law, the Town reserves the right to forfeit and terminate a franchise and all rights and privileges of a grantee thereunder in the event of a substantial breach of the terms and conditions of this chapter or a franchise agreement. A substantial breach by a grantee shall include, but not be limited to, the following:

(1) A violation of any material provision of a franchise agreement or this chapter or any material rule, order, regulation or determination of the Town made pursuant to a franchise agreement or this chapter.

(2) An attempt to evade any material provision of a franchise agreement or perpetuate any fraud or deceit upon the Town or a grantee's subscribers or customers;

(3) Failure to begin or complete cable system construction or extension;

(4) Failure to provide the services promised in a grantee's application, if any, as provided in a franchise agreement;

(5) Failure to restore service after 96 consecutive hours under normal operating conditions of an outage or service interruption, except when approval of such outage or service interruption is obtained from the Town; or

(6) Material and intentional misrepresentation of fact in the application for a franchise or in the negotiation of a franchise agreement.

B. The foregoing shall not constitute a substantial breach if the violation occurs but results directly or indirectly from circumstances beyond a grantee's control; provided, however, that a grantee shall not be excused by mere economic hardship or by misfeasance or malfeasance of its directors, officers, employees or agents.

C. In the event of a substantial breach of a franchise agreement, the Town shall make a written demand that a grantee comply with any such provision, rule, order or determination under or pursuant to this chapter or the franchise agreement. If the substantial breach continues for a period of 30 days following such written demand, without written or other proof acceptable to the Town that the corrective action has been taken or is being actively and expeditiously pursued, then the Town may place the issue of termination of a franchise before the Mayor and Council. The Town shall cause to be served upon a grantee, at least 45 days prior to the date of such meeting, a written notice of intent to invoke termination proceedings and the time and place of the meeting. Public notice shall be given of the meeting and the issue(s) which the Mayor and Council shall consider.

D. The Mayor and Council shall hear and consider the issue(s) and shall hear any person interested therein and shall determine in its discretion whether or not any violation by a grantee has occurred.

E. If the Mayor and Council determine the violation by a grantee was the fault of the grantee and within its control, the Mayor and Council shall declare in a written decision that the franchise of the grantee be terminated unless there is compliance within such period as the Mayor and Council may fix, to not be less than 60 days, provided no opportunity for compliance need be granted for fraud or misrepresentation. All notice requirements shall be met by providing the grantee with written notice (via certified mail, return receipt requested) of any public hearing concerning the proposed revocation of a franchise.

F. In addition to the penalties provided for herein, the Town and a grantee may agree upon any other lawful remedies in a franchise agreement.

§ 59-39 Notice of violation; hearing.

A. In the event the Town believes that a grantee has violated any provision of this chapter or a franchise agreement, provided that such violation does not constitute a substantial breach pursuant to § 59-38 of this chapter, the Town, by action of the Town Administrator, shall provide the grantee with written notice specifying the nature of the alleged violation and demanding correction within a reasonable time.

B. A grantee shall have 30 days from the receipt of the Town's notice described in Subsection A:

(1) To respond to the Town, contesting the assertion of the violation; or

(2) To cure such violation; or

(3) In the event that, by nature of the violation, such violation cannot be cured within the thirty-day period, initiate reasonable steps to remedy such violation and notify the Town of the steps being taken and the projected date that they will be completed.

C. In the event a grantee fails to respond to the Town's notice described in Subsection A, fails to correct a violation within the time prescribed and diligently remedy such violation thereafter, or responds contesting the alleged violation, the grantee shall then be given a written notice of not less than 20 days of a public hearing to be held before the Mayor and Council. Said notice shall specify the violation(s) alleged. At the public hearing, the Mayor and Council shall hear and consider all relevant evidence, and thereafter render findings and its decision.

D. In the event the Mayor and Council find that the grantee has corrected the violation, or has diligently commenced correction of such violation after notice thereof from the Town and is diligently proceeding to fully remedy such violation, or that no material violation has occurred, the proceedings shall terminate and no penalty or other sanction shall be imposed. In determining whether a violation is material, the Mayor and Council shall take into consideration the reliability of the evidence of the violation, the nature of the violation and the damage, if any, caused to the Town thereby, whether the violation was chronic, and any justifying or mitigating circumstances and such other matters as it may deem appropriate.

E. If the Mayor and Council determine after the hearing prescribed in Subsection C that the grantee is in violation and such violation is not cured within the times set forth in Subsection B, or in the event that the alleged violation is not remedied within the 30 days or the date projected pursuant to Subsection B, the violation shall be deemed a civil infraction, and a penalty of up to $500 per day for each day that a violation occurs may be assessable by the Town against a grantee in addition to any amounts otherwise due, and may be chargeable to the grantee's surety bond, letter of credit, performance bond or security deposit, if any. In the alternative, the Town may seek legal or equitable relief from any court of competent jurisdiction.

F. Unless otherwise provided in this chapter, a grantee shall pay any penalty assessed in accordance with this chapter within 30 days after receipt of notice from the Town of such penalty.

G. Pending litigation or any appeal to any regulatory body or court having jurisdiction over a grantee shall not excuse the grantee from the performance of its obligations under this chapter or its franchise agreement unless a stay is obtained. Failure of the grantee to perform such obligations because of pending litigation or petition, in the absence of a stay issued by a forum of competent jurisdiction, may result in forfeiture or revocation pursuant to the provisions of this chapter and/or its franchise agreement.