August 2010

In another sign of just how closely the FCC monitors contests conducted by broadcast stations, the FCC this week issued a Notice of Apparent Liability (a notice of a fine of $4000) to Nassau Broadcasting for being imprecise in the wording of the contest rules for a contest to be held at one of its stations.  In the rules of the contest, the station stated that entries would be accepted "through June 13, 2008."  In fact, the contest was conducted on the evening of June 12, and the station cut off entries to the contest on June 12.  When a listener went to enter the contest on June 13, and was told that she could not enter as the prize had already been awarded, the listener filed a complaint at the FCC.  The FCC, reading the language "through June 13" to mean that listeners could enter the contest up to and including that day, fined the licensee $4000 for misleading its listeners as to the proper rules for the contest it conducted.  This is another indication of just how seriously the FCC’s Enforcement Bureau is taking the enforcement of Section 73.1216 of the Commission’s rules, which requires licensees "to fully and accurately disclose the material terms" of any contests that it conducts, and to "conduct the contest substantially as announced or advertised."  Broadcasters need to be very precise in their wording of contest rules, and make sure that they carefully observe the details of the rules that they adopt.

In this case, it seems likely that the licensee was simply imprecise in its wording – stating that entries would be taken "through June 13" when it meant "before June 13."  This would have seemed evident from the fact that the rules said that the winner would be announced on the morning show on June 13.  Clearly, if the winner was going to be announced on the morning of June 13, it wouldn’t do much good entering after that time.  But the ambiguity in the rules is construed by the FCC against the party who prepared the rules – as is evident from the finding in this case that these rules did not fully and accurately describe the rules of the contest (and actually holding the contest on the night of the 12th instead of the morning of the 13th probably didn’t help much).  So what should a broadcaster do to make sure that this kind of ambiguity does not hit them in one of their contests?Continue Reading A $4000 Fine After a Complaint About a Broadcast Contest – Make Sure that Contest Rules are Precise

Are you ready to file your next license renewal application?  It seems like the last license renewal cycle just ended (in fact, the last cycle is not over, as evidenced by the fact that the FCC in the last week has released several decisions dealing with late-filed renewals from the last cycle, and many TV stations still have license renewals that have not been granted due to pending indecency issues).  Nevertheless, a whole new cycle of Form 303 license renewal applications will soon be upon us – beginning in less than a year. The cycle begins with radio stations in Virginia, West Virginia, Maryland and the District of Columbia, who are due to file their license renewal applications on June 1, 2011.  Then, every two months thereafter, stations in another group of states files applications, until April 1, 2014 when radio stations in Pennsylvania and Delaware bring the radio renewal cycle to a close.  Television station renewal applications will be due on a state-by-state basis beginning one year later – starting with TVs in DC and the same three states in 2012.  A schedule for the radio renewal filings is available here.  With these deadlines almost upon us, what should stations be doing now to get ready? 

In the last renewal cycle, the biggest source of problems dealt with public file issues.  Remember, stations need to certify in their renewal applications that their public file is complete and accurate and, if it is not, to specify areas where there are deficiencies.  In the last cycle, many stations in particular had issues with Quarterly Programs Issues Lists that were missing from the files, in many cases incurring fines of $10,000 or more where there were many such reports missing from the files.  These reports are also very important, as they are the only required official records to demonstrate the programming that a station broadcast to serve the public interest needs of its service area.  If that service is ever challenged, you will need the reports to demonstrate how your station’s programming met the needs and interests of your city of license and the surrounding area.  Check out our last advisory on the Quarterly Programs Issues Lists, here.Continue Reading FCC License Renewal Application Cycle Begins in Less Than A Year – What Stations Should Be Doing to Get Ready

While most of the FCC’s political broadcasting rules have remain unchanged for almost 20 years, each year there are a few new wrinkles that arise, and seemingly a few misconceptions that make the rounds among advertising agencies that work with political candidates.  One such misconception that seems to be circulating this year is that an ad for a state or local political candidate does not need to have their voice or picture to be a "use" under FCC rules.  Only "uses" are entitled to lowest unit rates and subject to the no censorship provisions.  For some reason, agencies in several states have tried to convince broadcasters that, as long as a spot has a sponsorship identification at the end (and, for television, a textual sponsorship identification 4% of screen height for 4 seconds), that spot is a "use."  But that is not correct.  A "use" requires that the recognizable voice or picture of a candidate be in the spot – and that is true even for spots for state and local candidates.  Some advertisers may be confused by the change in Federal laws (now itself almost a decade old) that required that Federal candidates identify themselves in their ads and personally state that they approved the message of the ad,  Perhaps some of the advertisers think that, because the law for Federal candidate is so detailed, and because it does not specifically cover state candidates (though several state laws now have imposed the same obligation on state and local candidates in their states), there is no requirement at all for state and local candidates to appear in their ads.  But they are not correct – for a spot to be a use, a candidate him or herself must have a recognizable voice or image in that ad.

While it is not illegal for a station to run a state or local candidate’s ad when the ad does not have a candidates voice in it, there are important ramifications for the station if the spot is not a "use".  First, without the candidate’s voice or picture, the ad is not entitled to lowest unit rates.  There has been some controversy, not settled by the Federal Election Commission and perhaps subject to interpretations under state election commission rules, about whether a station that charges a candidate lowest unit rates for a spot not entitled to such rates may be making a corporate campaign contribution to that candidate, which is prohibited under Federal law and in most states.  Most importantly for the stations, if the spot does not have the candidates voice or picture in it, the spot is not covered by the ‘No censorship" provision of Section 315 of the Communications Act.  That provision prohibits a station from rejecting a candidate’s ad based on its content.  But, because the station can’t reject the ad based on its content, the station has no liability for the contents of the ad.  Conversely, if the ad does not have the appearance by the candidate in it, then the station is free to reject it based on its content, and thus the station could theoretically have liability for the content of the ad.  As we approach a heated election season where stations don’t want the obligation to check the veracity of every claim made by one candidate about an opposing candidate in an attack ad, stations should be careful to insure that spots purchased by candidates are in fact uses, containing the recognizable voice or picture of the candidate – even for state and local candidates. Continue Reading Remember that Political Ads By State and Local Candidates Need to Have Candidate’s Recognizable Voice or Picture to Be a Use

The FCC recently fined a station $8500 for not having an operational EAS system for almost two years, and for not having a main studio that was manned during normal business hours. The EAS fine was evident, as the station did not dispute that it did not have an operational EAS system in place.  It did, however…

So you want to start streaming your radio station on the Internet?  Or maybe you want to start a whole new Internet radio station.  In a session at last week’s Texas Association of Broadcasters Annual Convention in Austin, Dave Oxenford talked about the legal considerations starting an Internet radio station, while Chris Dusterhoff…

The FCC today upheld the cancellation of a television station’s license for being off the air for over one year.  Section 312(g) of the Communications Act instructs the Commission to cancel a license of any broadcast station that has not transmitted "broadcast signals" for over one year, unless there is a public interest reason for allowing…

The debate over the proposed performance royalty (or "performance tax") on over-the-air radio is once again front page news in all of the broadcast trade press, as radio executives who make up the NAB Radio Board reportedly are making their way to Washington, DC to decide on whether to pursue a settlement with those seeking to impose the royalty.  What’s on the table?  Reportedly a very low (perhaps 1% of revenue as reported in some of the trades) royalty for terrestrial radio, a royalty set in legislation for at least a several year period.  In exchange, broadcasters would get a break on streaming royalties and a push towards getting working FM chips into cell phones – a potentially big audience boost for radio operators.  But from all we have heard, this is not, by any means, a done deal.  What will happen?

We wrote just a few weeks ago about a proposed settlement and why it might or might not be a good idea, and received many comments on our post.  As was clear from the comments, many are not sure why a settlement of any sort makes sense at this point, when the NAB has so far bottled up the royalty in Congress, and where the next Congress is, at least in the eyes of many, going to be far more Republican and, in some people’s eyes, a lot less likely to impose the royalty.  Proponents of a settlement respond that the royalty is not necessarily a partisan issue, with Republicans such as Senator Hatch of Utah, Congressman Issa of California, and many members of the Tennessee delegation taking strong positions in favor of the royalty.  So, just because there is a change in Congress (if it in fact occurs) does not necessarily mean that the current Performance Rights Act or some other version of the royalty proposal would be dead.  Moreover, as we wrote in our recent post, there still is the remainder of the current Congress to get through, including the "lame duck" session after the election, when Congressmen who may no longer have jobs will be voting on much legislation, including many big budget bills in which a performance royalty rider can get hidden. Continue Reading NAB Board Comes to DC to Discuss Radio Performance Royalties – Is There a Deal in the Works?

Congress last week adopted a bill important to all US media companies that produce content that can be received overseas.  This would include anyone with content on their website (including user generated content) that could potentially give rise to a legal judgment overseas.  As explained in detail in Davis Wright Tremaine’s memo on the act –…