Broadcast Law Blog

Broadcast Law Blog

$11,000 FCC EEO Fine for Recruiting Solely Through Online Sources – Time to Revisit the FCC Rules?

Posted in EEO Compliance/Diversity, FCC Fines

An FCC decision fining a cable company $11,000 for not adequately recruiting for job openings should be viewed as a warning to broadcasters as well as well as MVPDs – failure to recruit for job openings by disseminating information about those opening through diverse sources will likely result in a substantial fine under the current rules being enforced by the Commission’s Media Bureau. As the Commission has held before (see our article here), simply recruiting through online sources will not be enough to avoid the imposition of a fine. In this case, the FCC specifically points out that approximately 30% of the cable system’s service area did not have Internet access, so people in that group were likely not exposed to information about the station’s job openings. As the Commission requires that job openings be publicized so as to reach all groups within a system’s (or a broadcast station’s) recruitment area (which is related to its core service area), the decision found that the failure to recruit so as to reach this significant portion of the local population, together with the failure to complete one year’s EEO public inspection file report, merited a fine of $11,000.

One of the interesting aspects of this decision is the emphasis that the Media Bureau continues to put on the distinction between online recruiting and other more traditional means of reaching out to potential job applicants (e.g. using employment agencies, sending notices to community groups, using college job offices, etc.). Even though Commissioner O’Rielly has suggested that the Commission allow recruiting to be done solely using online sources (see our article here), as that is much more in tune with the way that job seekers today look for potential employment opportunities, the Commission continues to insist on station’s using these more traditional outreach efforts regardless of their success rate. In fact, the FCC has never revisited its 2003 EEO order that presumes that the local newspaper is a source that can reach most groups within a community, when it no doubt can be proven that, in today’s world, the circulation of online job sites is significantly greater than that of almost any newspaper. Commissioner O’Rielly notes that the FCC itself has recognized the reach of the Internet through actions such as the requirements that broadcast and MVPD public files be moved online, and that disclosures about contest rules can be made online. Yet, in the EEO world, online recruitment, unless tied with the use of other more traditional outside sources, will bring a fine. Certainly, it is an issue that the FCC needs to revisit – and one that perhaps will be revisited in appeals of decisions like this one, or in response to the calls of Commissioner O’Rielly and others. Continue Reading

Dirty Dancing with Trademark Rights: How Pop Culture References in Ads Can Raise Legal Issues

Posted in Advertising Issues, Intellectual Property, Trademark

Prospective advertisers come to your station and describe their ideas for local ads. A realtor’s ad ends with “There’s no place like home.” A boat builder says he will tell buyers, “You’re going to need a bigger boat.” And, a used car salesperson wants to say “I’m gonna make you an offer you can’t refuse.” These are pretty clever and, after all, they are everyday catchphrases, right?

Just don’t do it.

Advertising campaigns can be a source of legal liability for broadcasters when they merely allude to famous creative content that is protected under intellectual property laws. The recent decision in Lion’s Gate Entertainment, Inc. v. TD Ameritrade Services Company, Inc. demonstrates how broadcasters that publish ads containing pop culture references can run afoul of trademark rights and other legal issues. Continue Reading

SOCAN Buys Audiam – The Consolidation and Fragmentation of Music Rights – What Does it Mean for Music Services?

Posted in Intellectual Property, Internet Radio, Internet Video, Music Rights, On Line Media, Website Issues

The Canadian performance rights society SOCAN (essentially the Canadian version of ASCAP, BMI and SESAC) has announced the purchase of Audiam, a private company that specialized in representing composers trying to maximize their music rights collections – both for performance rights and mechanical royalties – worldwide. Audiam also claims to provide a comprehensive database of rightsholders to both musical compositions and sound recordings – a valuable commodity in and of itself, as there is no uniform public registry for such rights. This follows SOCAN’s purchase of MediaNet, a company that specializes in obtaining clearances for music (including sound or master recordings – the musical compositions that SOCAN has traditionally licensed as recorded by a particular singer or band) so as to provide those rights to digital music stores or services, eliminating the need for these services to separately negotiate terms with sound recording performance rights holders. This consolidation under one roof of public performance and mechanical rights to musical compositions, along with rights to sound recordings, promises at some point in the future, a one-stop shop where music users (including digital music services like Spotify or Deezer, and perhaps even smaller music users like podcasters) can obtain all the rights that they need to use music in their businesses.

This same goal seems to be the motivation behind SESAC’s acquisition in recent years of the Harry Fox Agency (which also handles mechanical licensing – the rights to make reproductions of musical compositions needed for downloads and even on-demand streams) and Rumblefish, a digital service providing clearances for the use of sound recordings in videos, commercials and for other purposes. This same drive to consolidate music licensing services was also, to some degree, behind the push for revisions to the ASCAP and BMI antitrust consent decrees, as ASCAP and BMI wanted the clear right to license mechanical rights as well as the public performance rights they now provide. Even the publisher withdrawals from ASCAP and BMI by major publishing companies that are affiliated with major record labels may have had similar ideas behind them as some have speculated that these major music companies could bundle the licensing of sound recordings and musical compositions (see our article here where we made the same observation). Continue Reading

Covering Breaking News and Local Emergencies – FCC Issues to Consider

Posted in Emergency Communications, General FCC, Intellectual Property, Political Broadcasting, Programming Regulations, Public Interest Obligations/Localism

In recent weeks, tragic events in Orlando, Dallas, Baton Rouge and elsewhere engender thoughts for the victims, their families and their communities.  Events like these have become all too common, and certain normal routine has developed, with broadcast stations devoting substantial amounts of airtime to coverage of the event until some new story takes away their attention. While the events are ones that cause us to think about those involved, and perhaps the broader political and policy issues that each raises, broadcasters also need to consider, to some degree, the legal implications of the coverage of such events and the questions that are sometimes raised about the FCC issues that can arise in such coverage.  Why isn’t EAS invoked?  Can we interview political candidates about the events?  What other legal issues should broadcasters be considering in connection with events like these?

One question that seemingly arises whenever events like these occur is why isn’t EAS used more often?  Even during 9-11, there was no activation of the EAS system, and there were some questions of why that was.  In fact, EAS is not intended to provide a source for blanket coverage of events like those that occurred recently, or even of those with broader national implications like the events of 9-11.  There are no reporters or information-gathering sources at the other end of the EAS alert system putting together updates on the news and ready to start providing substantive coverage of any news event.  Instead, EAS is meant to provide immediate alerts about breaking, actionable events – like the approach of a severe storm, the need to evacuate a particular area in the advance of a fire or after a tanker spill or, in its origins during the Cold War, the possibility of a nuclear attack.  In any of these events, it is not EAS, but the broadcasters themselves and other journalists who are the ones that need to provide the in-depth coverage of events as they occur.  While the FCC is looking at revamping the EAS system in many different proceedings, the basic workings of the system do not change.  A weather alert or a Presidential address on a catastrophic event may occur through EAS, but the full coverage of that event, with all the developments and details, is going to come from the broadcasters themselves, not from Federal, state or local EAS alerts. Continue Reading

Legal Issues for Broadcasters – Updates on Pending Matters

Posted in AM Radio, Appearances, Cable Carriage, Digital Television, EEO Compliance/Diversity, Emergency Communications, FM Radio, FM Translators and LPFM, General FCC, Incentive Auctions/Broadband Report, Low Power Television/Class A TV, Multiple Ownership Rules, Music Rights, Payola and Sponsorship Identification, Political Broadcasting, Programming Regulations, Public Interest Obligations/Localism, Television

There are so many legal issues that facing broadcasters that it is sometimes difficult to keep up with them all. This Blog and many other activities that those at my firm engage in are meant to help our clients and other broadcasters keep up to date on all of the many regulatory challenges with which broadcasters must deal, while at the same time keeping up with their business operations. Each quarter, my partner David O’Connor and I update a list of the legal and regulatory issues facing TV broadcasters. That list of issues is published by TVNewsCheck and is available on their website, here. Our latest update was published last week, and provides a summary of the status of legal and regulatory issues ranging from the adoption of the ATSC 3.0 standard at one end of the alphabet to White Spaces and Wireless Microphones on the other – with summaries of other issues including the Incentive Auction, EEO compliance, Political Advertising and Sponsorship Identification, along with dozens of other topics, many with links to our more detailed discussions here on the Blog. Of course, these issues change almost daily, as last week’s article does not include a discussion of the Chairman’s announcement that there will be no changes in the rules regarding the good faith negotiation of retransmission consent agreements, an announcement about which we wrote last week, here. But if you are trying to keep on top of all the other legal and regulatory issues TV broadcasters should be considering this summer, or if you are looking for the current status of specific proceedings potentially impacting TV broadcasters, check out our most recent updated summary, here.

Of course, there are issues that radio broadcasters face as well. Since the end of May, I have traveled to five different broadcasters’ conventions to talk about the many legal and regulatory issues that are facing the broadcast industry generally, including those that are facing radio. The slides that I used for my presentation at the last of these conferences, the Montana Broadcasters Annual Convention, are available here. In that presentation, I discussed issues including AM revitalization and FM translators, the online public inspection file, music licensing, political broadcasting, and other matters. While none of these articles or presentations can be comprehensive, these slides and the TV NewsCheck update, at least give you a quick overview of the many issues that broadcasters should be watching to stay on top of their legal obligations.

FCC Chairman Announces No Changes in Good Faith Negotiation Standards for Retransmission Consent Agreements Between TV and MVPDs

Posted in Cable Carriage, Television

FCC Chairman Tom Wheeler yesterday used a blog post to announce that the Commission’s pending rulemaking concerning its retransmission consent rules is ending without the adoption of any additional rules.  This proceeding was to review the “totality of the circumstances” test in determining whether TV stations and MVPDs (cable and satellite television systems) were negotiating in good faith to reach a retransmission consent agreement.  In last year’s Notice of Proposed Rulemaking in this proceeding, the FCC proposed a number of possible negotiating tactics that could be declared to be per se violations of the good faith standard – including items such as ending retransmission consent before a major television event (like the Super Bowl) or blocking access to online streams of programming to Internet subscribers who were affiliated with the MVPD involved in the retransmission dispute (see our summary of the proceeding here).  Many broadcasters and industry analysts feared that there would be regulations adopted that could restrict TV stations’ ability to negotiate favorable retransmission consent deals.  But the Commission seems to have reached the conclusion that they can already, under existing rules, cajole parties to reach a deal if the need arises and that no more specific regulations are needed.

In his blog post, Chairman Wheeler stated that after FCC staff had conducted an extensive review of the record, “it is clear that more rules in this area are not what we need at this point.”  He noted that the FCC has an existing nine-point test to judge the compliance of parties with the good faith requirement, plus the broader “totality of circumstances” standard that can be used to find a party in violation even when none of the specifically prohibited conduct has occurred.  While little enforcement action has actually been taken in this area, it has often been threatened to bring parties to the table and encourage a voluntary settlement.  The Chairman seemed to think that the existing remedies were enough to act in extreme cases, and trying to decide in more specificity which practices were prohibited and which were permitted “could limit future inquiries.”    In other words, adopting more specific prohibitions could make it more difficult to rely on the broader “totality of circumstances” test in any particular case that did not involve a specifically prohibited activity.  Continue Reading

$700,000 to Be Paid By Media General to End Inquiry on its Attempts to Enforce a JSA – What are the Limits on the Enforceability of a Contractual Restriction on an FCC Licensee’s Sale of its Station?

Posted in Assignments and Transfers, FCC Fines, Incentive Auctions/Broadband Report, Multiple Ownership Rules, Programming Regulations, Public Interest Obligations/Localism, Television

The FCC yesterday announced a consent decree with Media General by which Media General agreed to pay a $700,000 “settlement payment” to the US Treasury to settle the investigation of its attempts to enforce the provisions of a Joint Sales Agreement with Schurz Communications.  Media General had tried to enforce the JSA when Schurz tried to terminate that agreement in order to sell its station to Gray Television.  Media General tried to get an injunction from a state court seeking to stop the sale, continue the JSA, and prevent Schurz or Gray from putting the station into the incentive auction.  As we wrote here when the case first arose, the FCC wrote to the court, contending that the injunction would not only violate the conditions placed on the sale by the FCC (that the Schurz station be sold before the Gray deal could close) but, more importantly for the general broadcast community, that the restrictions on the sale of the station, and its participation in the incentive auction, were improper restrictions on the control rights of the licensee.  Essentially, the FCC was saying the licensee’s right to sell the spectrum it had was not one that could be conveyed to a third party.  The FCC even stated its intention to initiate a proceeding to determine whether Media General’s FCC licenses should be revoked.

What we wrote when the case came out, and what we wonder now, is what the FCC considers the degree to which a licensee’s ability to sell its spectrum can be limited by contract or agreement.  Yesterday’s release provides no guidance, as it was simply a settlement agreement.  The consent decree recites what the FCC was initially concerned with, but Media General did not admit any liability, and the consent decree does not reach any conclusion as to the actual basis of the settlement payment.  So it is conceivable that the FCC was actually only worried about the attempts by Media General to require that the station be kept and the JSA stay in place, even though the FCC ordered that it end.  It may not have been a case dealing principally with control at all, but instead one dealing with grandfathered JSAs and whether those JSAs can stay in place after the sale of one of the television stations involved in the arrangement.  Otherwise, if the case was really about putting limits on the degree to which contracts can limit the ability of a licensee to sell its station, that issue could have had much broader implications than the FCC may have intended. Continue Reading

Avoiding Olympic Hassles – Trademark and Other Legal Protections Limit the Use of Olympics, Paralympics and Related Terms in Advertising, Marketing, and Promotions

Posted in Advertising Issues, Intellectual Property, Programming Regulations, Trademark

Over the last several months, we have written about the risks of publishing ads or engaging in promotional activities that refer to the SUPER BOWL® or MARCH MADNESS® without first asking the NFL or the NCAA, respectively, for permission to use those marks.  With millions of viewers about to tune into the OLYMPIC® games in Rio this August, we similarly remind our readers that any Olympic trademarks, symbols or other branded content should not be used in advertising and marketing campaigns across any media platforms (on-air, websites, social media sites, in hashtags, apps, etc.) except by authorized advertisers.  And, for the reasons we discuss below, dealing with these marks deserve an Olympic-size dollop of caution.

We’ve written before (here and here) how Olympic sponsors pay big bucks for the rights to sponsor the Olympics, and to get exclusivity to associate their brands with the games. Thus, the sponsors guard their territory carefully, as do the Olympic organizations whose ability to stage the games is dependent on such sponsorship.  Numerous small businesses, nonprofits, and even individuals have been on the receiving end of cease and desist letters, including, for example, a knitting group that used the term RAVELYMPICS for a knitting competition, a charcuterie in Portland named OLYMPIC PROVISIONS, and a Philadelphia sub shop named OLYMPIC GYRO. Continue Reading

Foreign Ownership of US Broadcast Stations Suddenly the Rage? – FCC Seeks Comments on Two Proposals for Alien Ownership to Exceed 25%, Including One for 100% Australian Ownership

Posted in AM Radio, Assignments and Transfers, FM Radio, General FCC, Multiple Ownership Rules, Television

In the last two days, the FCC has asked for public comment on two proposals for foreign ownership of US broadcast stations where that ownership would exceed 25% of the company – a limit that has for decades been seen as the upper end of ownership by foreign nationals.  While the FCC three years ago said that they would consider such ownership on a case by case basis (see our article here), up until this week, the FCC had considered only one case under this new flexible policy – and that was the case of Pandora, where the FCC took over a year to approve their acquisition of a broadcast station – and Pandora didn’t even think that their foreign ownership exceeded the 25% threshold, but they could not prove it because of the difficulty of assessing the citizenship of public companies (see our article here on the filing of the Pandora petition).  Now, the FCC seeks comments on two cases, one where an Australian husband and wife team seek to acquire 100% ownership of companies owning 29 radio and TV stations in Alaska, Arkansas and Texas.  The second involves Univision, which asks for FCC approval for foreign ownership of up to 49% of its stock, as it plans a public offering which would also involve the conversion to stock of warrants held by a Mexican company that already has a stake in the company.

While the FCC last year asked for comments on adopting new processing rules for these kinds of requests – especially those involving public companies – no order has come out of the FCC on that proceeding yet (see our summary here).  Last month, the FCC did adopt some new procedures for the streamlining of the consideration of foreign ownership requests for all services regulated by the FCC, not just broadcasting, but that proceeding did not deal with the substantive issues surrounding foreign ownership, but instead with the process by which the FCC interacts with other government agencies in assessing the national security concerns with foreign ownership of communications properties.  With this background, does the release of these two requests for comment signal any movement from the FCC on foreign ownership issues? Continue Reading

FAA Clears Small Drones for Takeoff: What You Need to Know

Posted in Programming Regulations, Uncategorized

New FAA rules for drones were recently approved, and the rules may provide more opportunities for broadcasters to get in the game.  Emilie de Lozier from my firm offers these thoughts:

Broadcasters, prepare for takeoff later this summer.  The Federal Aviation Administration recently finalized rules to broadly permit the commercial operation of small unmanned aircraft systems (“sUAS”) – or drones – provided certain requirements are met.  The new rules are in many cases more permissive than the existing regulatory framework, but some potential pitfalls remain.  Rest assured, we are here to help you navigate the complexities of this new regime.  Below we provide a high-level discussion of the new rules and their effect on broadcasters’ future sUAS operations to support newsgathering.

We previously wrote about the FAA rulemaking to develop these rules here.  As a quick refresher, in 2012, Congress directed the FAA to develop a plan for incorporating drones into the national airspace.  In the meantime, the FAA created an exemption process pursuant to Section 333 of the FAA Modernization and Reform Act of 2012 to authorize commercial UAS operations on a case-by-case basis.  The FAA has granted more than 5,000 exemption requests to date, including for newsgathering purposes, and thousands of these requests remain pending.  (If your petition is among those pending, you should monitor your petition docket for a status update from the FAA in the coming weeks.)  The new rules are intended to minimize the need for parties, including broadcasters, to seek such exemptions. Continue Reading