On October 31, the US Department of Agriculture published in the Federal Register interim rules governing the production of industrial hemp under the provisions of the 2018 Farm Act (see the USDA press release here).  These rules will allow the USDA to approve state and tribal plans for the regulation of hemp production.  It also allows for the USDA to authorize growers in states that have not adopted their own plans (or that have restricted the production of hemp).  The USDA notes the interest in hemp production driven by interest in CBD products derived from hemp.  While these rules do not address advertising issues specifically, they do ease some of the concerns that many broadcasters and other media companies have had about advertising CBD products when it was unclear that the production of those products was legal.  We wrote about some of those concerns many times, including in our posts here and here.

These interim rules recognize that CBD products can already be legally produced under provisions of the 2014 Farm Act.  As we noted here, that Act authorized experimental production of hemp products.  The 2014 Act also permitted research into commercial exploitation of hemp products – probably permitting greater production than Congress or the USDA expected when the Act was adopted.  The October 31 public notice states that production under the 2014 Act will be allowed to continue for the next three years until permanent rules implementing the 2018 Act are adopted.  In fact, the USDA notes that it expects that over 50% of hemp production will be by those operating under these grandfathered 2014 licenses for the next year.  This seems to recognize that a significant amount of production already underway is in fact legal under federal law, ameliorating some of the concerns as to whether CBD products now being sold could have been legally produced.  Continue Reading USDA Issues Interim Rules for Hemp Production – How Does it Affect CBD Advertising? 

As we noted in our list of November Regulatory dates for broadcasters, at its November 22 meeting, the FCC will be considering the adoption of a Notice of Proposed Rulemaking (see the draft order here) allowing AM stations to go all digital – on a voluntary basis. This Notice follows a Petition for Rulemaking which I filed on behalf of my client Bryan Broadcasting (see our articles here and here). The FCC’s NPRM, if adopted in the form of the draft Notice, suggests that the Commission, subject to a review of comments, is inclined to adopt the proposal to allow AM stations to voluntarily convert to an all-digital operation. While that is the tentative conclusion of the FCC, it does pose numerous questions on which it seeks comments.

The FCC’s questions include inquiries on the technical, programming, and operational aspects of the conversion of an AM station to digital. But the FCC recognizes some of the potential benefits of the all-digital operation and identifies some of the likely early adaptors of any such technology. These early adopters would likely include AM stations that have an FM translator that can continue to provide programming to the public even if some of the public does not have a radio with AM digital reception capabilities. We note that some AM operators with FM translators have already suggested the possibility of surrendering their AM signal, a proposal that has thus far been rejected by the FCC (see our articles here and here). The prospect of an all-digital AM operation would allow these stations to rely on their FM translator for current analog coverage of their markets, while trying to provide a more robust AM signal in the long-term rather than simply abandoning the service altogether. In addition, music stations are much more likely to be interested in an all-digital operation with the promise of higher fidelity than possible through an analog operation. But the FCC asks numerous other questions. Continue Reading FCC To Consider All-Digital AM at its November Meeting – What Questions are Being Asked?

In September, a three-judge panel of the US Court of Appeals for the Third Circuit released a 2-1 decision overturning the FCC’s 2017 decision modifying many of its ownership rules (see our summary of the Court decision here, and our review of the 2017 decision here).  The Court’s decision not only upset the plans of many media companies for acquisitions based on the changes adopted in the 2017 decision, but also dashed the hope of many radio companies for timely changes in the radio ownership rules that are under consideration by the FCC in its next Quadrennial Review of its ownership rules (see our summary of the issues in the current Quadrennial Review here).  Last week, both the FCC and a number of industry groups who were parties to the Third Circuit case filed Petitions asking that all of the sitting judges on the Third Circuit vote to rehear the decision of the three-judge panel.

The panel’s decision did not find that any of the rule changes adopted by the Commission (including the abolition of the newspaper-broadcast cross-ownership prohibition) were not justified by changes in the media marketplace.  Instead, the panel voided the FCC’s decision because it did not believe that the FCC had enough historical data on minority and female ownership to be able to judge the affects of any ownership changes on diversity of ownership in the media industry.  The FCC Petition for Rehearing centered on an argument that the Commission had plenty of data to support its conclusions – and that Courts have never required government agencies to have perfect information in making any decision.  Instead, agencies are only required to have sufficient factual data to justify their conclusions.  The FCC argued that, where the information that is sought by the panel might simply not exist and where the panel’s insistence on the information has held up the FCC’s attempts to modernize its media ownership rules for a decade and a half as the same judges keep rejecting FCC attempts to justify its ownership decisions, the full Court should step in and conduct a rehearing.  The industry parties emphasized how the decision was overbroad – overturning all aspects of the FCC’s decision – even parts that had not been challenged by the petitioning parties.  The industry participants also pointed to the fact that real hardships were being imposed on media companies as the FCC had not been able make changes in its ownership rules to reflect the changes in the industry that had occurred in what may have been the most dynamic 15 years in the history of the mass media.  With these requests for rehearing on file, what is next? Continue Reading Third Circuit Asked to Rehear Decision Overturning FCC Ownership Rule Changes – Where Do We Go from Here? 

Several years ago, the FCC mandated that broadcasters utilize not only the traditional over-the-air “daisy-chain” broadcast EAS alerting system where emergency alerts are passed from one station to another but also utilize an Internet-based Common Alerting Protocol (“CAP”) system where warnings can be sent directly to stations (see, for example, our articles here and here). As part of the rules governing those CAP-formatted alerts, EAS systems were to be configured so that they would reject alerts that did not have valid digital certificates, so that only validated alerts would end up being broadcast on stations. Most of us have had experiences where some favorite website or internet network is rejected by our computer because of an expired digital certificate. It appears that the same thing has happened to the alerts sent by the Federal Emergency Management Agency’s Integrated Public Alert and Warning System (IPAWS). The IPAWS certificate is scheduled to expire on Friday, November 8, and updated digital certificates were only forwarded to many EAS devices last week. That means that, if these devices are not updated to include the new certificates by Friday, the FEMA IPAWS alerts would be rejected by the devices installed at broadcast stations and at other EAS participants. Obviously, that would present problems if alerts from the government’s principal agency dealing with emergency matters were routinely rejected – so the FCC yesterday issued a Public Notice to address the issue.

According to yesterday’s Public Notice, if their EAS receivers become defective, broadcasters and other EAS participants can still be considered to be in compliance with FCC rules for a period of 60 days. Given the late distribution of the updated digital certificates, the FCC said that stations will have that 60-day period, until January 7, 2020, to update the digital certificates in their EAS devices so that they will accept the IPAWS alerts. The FCC cautions that broadcasters should work to get their devices updated as soon as possible. If, for any reason, they cannot get into compliance by January 7, they must seek FCC permission for continued operations after that date. The FCC notes that this issue does not affect broadcaster’s over-the-air operations, so alerts should still be able to be transmitted and received in the traditional manner, even if the Internet-based alerts are rejected by some devices. Stations should start now to update their CAP-based systems so that their digital certificates are up to date and can receive the IPAWS alerts as soon as possible.

At its October open meeting, the FCC adopted a Notice of Proposed Rulemaking looking to abolish its rule that bars a broadcast licensee from prohibiting a competitor from using a “unique” transmitter site that it controls. The rule was adopted decades ago and never used. It provides that a license renewal would not be granted to a broadcast licensee who controls a transmitter site that is the only site that could be used by a potential competitor and prohibits that competitor from using the unique site. Given that this rule has never been used, and that there are many more communications towers now than at any time in the past (as well as more broadcast stations), the FCC suggested that the rule was no longer needed to insure that new broadcast services could be provided to the public.

That NPRM has now been published in the Federal Register. Comments are due December 6, with reply comments due on December 23. Given the limited utility of this rule, we would expect few broadcasters will be rushing in to provide their comments on this FCC proposal. But, if this potentially affects your business plans going forward, you now know when you can file your comments in this proceeding.

It seems like every other week, there is a story about an online media giant making changes in their rules that govern political advertising on their platform – and being either praised or condemned for doing so. We recently wrote about the controversy over Facebook deciding to not fact-check candidate ads, and how Congress itself requires by statute that broadcast stations take that same position. Broadcast stations are not allowed to censor ads from legally qualified candidates so, except in very limited circumstances where the ads may be criminal in nature (and not where they might just give rise to civil claims, like in the case of defamation or copyright infringement), broadcasters cannot reject ads based on their content. The right of a person being defamed in an ad for redress of any civil claim they may have is against the candidate who sponsored the ad, not against the broadcaster. Last week brought the news that Twitter has decided to ban political ads from its platform. Broadcasters, on the other hand, have no ability to ban ads for Federal candidates, as Congress has legislated a right of access to the airwaves where broadcasters cannot refuse to run political advertising from any Federal candidate.

That right of reasonable access, written into Section 312 of the Communications Act, requires that broadcasters give Federal candidates access to all classes of advertising time sold on a broadcast station, and that access be provided in all parts of the broadcast day. See our post here for more information about that reasonable access requirement, and our post here on the limited exception accorded for special events with limited advertising inventory (like the Super Bowl), where the provision of ads to one side might be problematic as there would be no opportunity for an opposing candidate to find an equivalent opportunity to advertise, and because of the potential disruption to commercial advertising on these stations given the limited availability of advertising breaks in such programs. Continue Reading Twitter Bans Political Ads – Doing What Broadcasters are Forbidden to Do

The FCC announced on Friday that it will be hosting a symposium on the state of the broadcast industry on November 21.  On that day, there will be a panel in the morning on the state of the radio industry and one in the afternoon on television.  The Public Notice released Friday lists a diverse group of panelists, but says little beyond the fact that the forum will be occurring.  What could be behind the Commission’s decision to host this session?

The FCC is working on its Quadrennial Review of its ownership rules (see our articles here and here).  There were many who expected that review to be completed either late this year or early next, with relaxation of the radio ownership rules thought to be one of the possible outcomes.  Of course, quick action may have been derailed by the decision of the Third Circuit Court of the Appeals to vacate and remand the Commission’s 2017 ownership order.  The court’s decision unwinds the FCC’s 2017 order which included abolition of the broadcast newspaper cross-ownership rule and the rule that limited one owner from owning two TV stations in the same market unless there were 8 independent television operators in that market – see our article here on the 2017 decision and our article here on the Third Circuit’s decision.  The basis of the Third Circuit decision was that the FCC did not have sufficient information to assess the impact of its rule changes on minority ownership and other potential new entrants into broadcast ownership.  If the FCC did not have enough information to justify the 2017 decisions, many believe any further changes in its rules are on hold until the FCC can either satisfy the court’s desire for more information on minority ownership or until there is a successful appeal of that decision.  Even though FCC changes to its ownership rules may be in abeyance, the November 21 forum can shed light on the current state of the industry and why changes in ownership rules may be justified. Continue Reading FCC To Hold Symposium on Radio and TV Industry – What Does it Mean for Broadcast Regulation?

November is not one of those months with due dates for renewal filings, EEO public file reports or quarterly issues programs reports. Some of those obligations wait until December, when renewal filings for radio stations in Georgia and Alabama are due by December 2 (as December 1 falls on a weekend). Due for uploading on or before December 1 are EEO public file reports for station employment units with 5 or more full-time employees for radio or television stations in Alabama, Colorado, Connecticut, Georgia, Maine, Massachusetts, Minnesota, Montana, New Hampshire, North Dakota, Rhode Island, South Dakota, and Vermont.

November 1 does signal the first day on which radio and TV stations can file their Biennial Ownership Reports. As we wrote here, the FCC has extended the deadline date for those filings until January 31, 2020 as the FCC is making refinements in its forms in the LMS filing system. Reports are to reflect the licensee’s ownership as of October 1, 2019 so stations have the information that they need and can start filing their reports later this week. Continue Reading November Regulatory Dates for Broadcasters – Ownership Reports, Comment Deadlines, LPTV Reimbursement Filing Deadline, a Forum to Examine the Future of the Broadcast Industry, and More

The FCC’s Further Notice of Proposed Rulemaking on annual regulatory fees was published in the Federal Register this week, setting the comment date in that proceeding as November 22, with reply comments due December 23. As we wrote when the FCC’s fee decision for 2019 fees was released, this Further Notice is examining a number of issues. For broadcasters, there are two directly relevant issues. First, there is a question as to whether there should be some reduction of the regulatory fees for VHF television stations and, if so, what that reduction should be. The FCC this year moved to basing regulatory fees for a TV station on its estimated population coverage. Some VHF station owners have argued that, because VHF stations are subject to much more interference and have worse building penetration than do UHF stations, their predicted coverage does not accurately reflect their potential audience as it may for UHF stations, and thus the do not receive the same benefits from their license and the associated regulation as does a UHF station. The Further Notice seeks comment on this issue.

The second issue is whether stations involved in the FCC’s incubator program (about which we wrote here) should receive pay lower fees in order to promote the economic success of these stations owned by new broadcast owners. The hope is that this program will encourage broadcast ownership diversity. While organizations advocating for broadcast diversity have supported this idea, the recent 3rd Circuit decision overturning the FCC’s recent ownership rules and remanding them to the FCC for further consideration (see our article here) has put the incubator program on hold for the time being. Nevertheless, interested parties can file on this question and on the issue of a reduction in fees for VHF stations, by the November 22 deadline.

The FCC last week released two decisions (here and here) addressing complaints from public interest groups against several TV stations alleging that the stations had not sufficiently disclosed in their online public files sufficient information about political issue advertising.  These decisions, as detailed below, will end up making life significantly more difficult for broadcasters running ads from non-candidate groups, as they will need to review each issue ad to come up with a list all of the issues of public importance discussed in the ad.  A perhaps unintended result may also be that there will be more disclosure in the public file of the cost of non-candidate political ads supporting or attacking state and local candidates when those ads mention Federal issues – as more and more ads dealing with state elections now do.  Watch as the ramifications of these decisions become clear in the coming months.

Background:  These decisions should not strike regular readers of this blog as particularly new, as these complaints were considered by the FCC’s Media Bureau in early 2017, under the former leadership of the FCC (see our article here).  When the new Republican-controlled Commission took over, the Media Bureau decisions were rescinded, as the new Commission felt that these issues should be considered by the Commissioners rather than at the Bureau level.  The decisions that resulted from this additional review come to much the same result as had the Media Bureau decision, though some of the explanations are more detailed.  In making the decision more detailed, the Commission may have made the acceptance of political ads from non-candidate groups even more troublesome for broadcasters than these ads have been in the past.  What do these rulings provide? Continue Reading FCC Issues “Clarifications” of Political Broadcasting Public File Disclosure Requirements – Significantly More Disclosures to Be Required on Issue Ads