The FCC’s Video Division yesterday issued a Notice of Apparent Liability to a Baltimore TV station for airing a commercial for a Hot Wheels product in eight showings of the program “Team Hot Wheels.”  The Commission has, for almost 30 years, had a policy against what they term “program-length commercials” – programs that feature characters who are also featured in a commercial that runs during the program.  The FCC has been concerned that children may not perceive the difference between a program and a commercial that runs in that program if both feature the same characters.  If the whole program is perceived as promoting the product, then the program would exceed the commercial limits in children’s programming set by Congress and incorporated in Section 73.670 of the rules – 10.5 minutes per hour on weekends and 12 minutes per hour on weekdays.

A decade ago, this was a significant issue.  On one day in 2010, the FCC issued seven Notices of Apparent Liability, seeking fines of as much as $70,000 for these violations (see our article here).  Even before that, we noted how stations can inadvertently find themselves in these situations when featured characters unexpectedly pop up in commercials for products other than those that are directly for products featuring those characters.  So, where a cartoon character appears on an ad for a video game, that can make the entire program a commercial – even though the broadcaster may not have realized until after the fact that the character would be featured in the video game commercial.  In this week’s case, the facts are a little different, but still emphasize the care that TV broadcasters need to exert to ensure that nothing is aired that could make a program into a program-length commercial.
Continue Reading FCC Proposes $20,000 Fine for TV Station Program-Length Commercial in Children’s Programming

Here are some of the regulatory developments of the last week of significance to broadcasters, with links to where you can go to find more information as to how these actions may affect your operations.

  • After reviewing comments submitted this summer (we wrote about the rulemaking, here), the FCC will vote at its next

In the last few days, two defamation cases filed against media companies by the Trump campaign have been dismissed – one on the merits and one by agreement of the parties.  This includes the suit filed by the campaign against Northland Television, the licensee of a rural Wisconsin television station.  That station was perhaps the smallest TV station to air an ad by a non-candidate group, Priorities USA, that the Trump campaign alleged was misleadingly edited to assert that the President had labeled the coronavirus a “hoax.”  As we wrote here when that suit was first filed, the campaign claimed that the reference to the hoax was not about the virus itself but was actually a reference to “the Democrats’ exploitation of a pandemic and related characterization of the candidate’s response to the pandemic.”  This suit was vigorously opposed by the station and the sponsor of the ad.  The parties have now agreed to voluntarily dismiss that suit with prejudice, meaning that it cannot be refiled.

Another suit was brought by the campaign against CNN alleging that CNN had libeled the President by publishing on its website an article from one of its contributors who alleged that the campaign had assessed the risks of seeking Russian assistance in the 2020 campaign and had “decided to leave that option on the table.”  The campaign alleged that the statement was false and defamatory – and published with knowledge that it was false.  CNN had countered that the statement was protected as it was presented as opinion, not fact, and moreover it was published without “actual malice.”  As we have written before (see, for instance, our articles here and here), under Supreme Court precedent, a claim about a public figure for defamation can only be sustained if it is both false and published with “actual malice” – meaning that the publisher knew that it was false, or acted with reckless disregard as to whether or not it was false and published it anyway.
Continue Reading Two Trump Defamation Claims Dismissed Including Claim Against TV Station for Political Attack Ad – What is the Relevance for Broadcasters? 

The FCC yesterday released a Public Notice making clear that lowest unit rates (or lowest unit charges) end on Election Day.  Some broadcasters had asked the question, fearful that there would be political advertising bought after Election Day to take positions on issues about counting the vote and other legal matters that could arise

As the campaign enters its final weeks, the FCC has begun to send out the next round of proposed consent decrees to radio broadcasters unable to certify in their license renewal applications, because of perceived deficiencies in their political file, that that every document was placed into their FCC-hosted online public inspection file on a timely basis (see, for instance, this decree released yesterday).  The certification of public file compliance is required of every applicant for license renewal.  As with any other certification, a licensee must review its records and truthfully answer the application’s question, either certifying that it has complied with all of the public file obligations or disclosing any deficiencies.  As we wrote last year, in cases of substantial noncompliance, the FCC has fined stations that essentially ignored the public file rules.  But, until recently, in cases where a station had made a good faith effort to comply but had some minor deficiencies in the public file (as is natural over an eight-year renewal period), the FCC has generally been granting renewals, acknowledging that minor violations do not signal that a broadcaster is not operating in the public interest.  However, in August, the Commission initiated a new policy for stations that reported deficiencies in the political portion of the public inspection file, sending draft consent decrees to virtually all stations unable to certify full public file compliance because of any political file issue.

These consent decrees were modeled on the ones that were sent in July to six large radio broadcast groups as a result of an earlier FCC review of their political files (see our article here on those consent decrees, which also provides a review of a broadcaster’s political file obligations).  The difference is, of course, that the July decrees went to large radio groups for what the FCC described as hundreds of violations at many radio stations.  The new renewal-driven consent decrees were sent to all stations that did not certify political file compliance, even to stations that had only a handful of political advertising sales if those stations determined that they could not certify that all required documents went into the file in a timely fashion.  While the decrees carry no monetary fine, they do require that the signing station enter into a compliance program – appointing a compliance officer, having a written compliance plan, reporting any violations to the FCC as they occur, and providing a report to the FCC at the end of each calendar year for two years cataloging all political sales and when the required documents went into the political file.
Continue Reading More FCC Consent Decrees for Political File Violations – Issues to Watch in the Last Weeks of the Election

Back in August, we highlighted some of the many issues in computing lowest unit charges (or “lowest unit rates”) for political candidates which are in effect during the window for the November elections that went into effect on September 4.  In this last month before the election, as political advertising ramps up and each party fights over those few undecided viewers, we wanted to bring to your attention a video that I did for the Indiana Broadcasters Association discussing the various issues that arise in determining lowest unit rates.  That video summarizes many of the issues that we wrote about back in August and is available here:

At the end of this article, we provide links to other videos produced by the Indiana Broadcasters discussing other political broadcasting issues, and to other articles that we have written on other political broadcasting issues.

As we wrote back in August, lowest unit charges (or “Lowest Unit Rates”) guarantee that, in the 45 days before a primary and the 60 days before a general election, legally qualified candidates get the lowest rate for a spot that is then running on the station within any class of advertising time running in any particular daypart. Candidates also get the benefit of all volume discounts without having to buy in volume – i.e., the candidate gets the same rate for buying one spot as your most favored advertiser gets for buying hundreds of spots of the same class. But there are many other aspects to the lowest unit rates, and stations need to be sure that they get these rules right.
Continue Reading A Video Summary of the Rules on Lowest Unit Rates and Other Political Broadcasting Resources

Here are some of the regulatory and legal actions and developments of the last week of significance to broadcasters, with links to where you can go to find more information as to how these actions may affect your operations.

  • Political advertising will continue to blanket the airwaves for the next month and a half and

Now that we are immersed in the heart of the political broadcasting season, issues of sponsorship identification regularly arise.  For on-air broadcasts, any paid advertisement that conveys a message dealing with any controversial issue of public importance (state or federal) requires at a minimum an on-air sponsorship identification stating that the ad was “paid for” or “sponsored by” the person or organization that paid for the time.  Federal candidates have a more extensive obligation for identifying themselves in their ads, particularly if they mention an opposing candidate.  These identification rules come both from the FCC (which stations need to enforce) and from the Federal Election Commission, which are the responsibility of the candidate and their campaign committee.  To help sort out some of these obligations, and the requirements for political disclosure statements and federal candidate certifications that entitle them to lowest unit rates, check out this video that I prepared for the Indiana Broadcasters Association as part of a series on political broadcasting topics:  https://www.indianabroadcasters.org/iba-news/political-advertising-requirements-with-iba-washington-counsel-david-oxenford/

The video covers the requirements of broadcasters to ensure that the proper sponsorship identification is contained in political advertising.  Online political advertising, however, is much more complicated as there is no single body of law that governs those responsibilities.  As we wrote here, the FEC has general requirements providing that online political advertising must have sponsorship identification. The FEC also has an open proceeding to mandate more stringent sponsorship identification obligations akin to those required on broadcast and local cable political advertising.  Last week, the Congressional Research Service issued a study on the state of the law regarding online political advertising, highlighting the many issues involved in providing more robust political disclosures.  These issues are at least partially triggered by the many players involved in online advertising sales.  There is a very readable outline on pages 16-19 of the report on all the players in the digital advertising ecosystem – with intermediaries, including demand- and supply-side platforms, that complicate the usual direct interaction between the media outlet and the advertising buyer, which in turn complicates the political compliance process for sponsorship identification.  The study, on page 18, even cites to the article that I wrote discussing the concerns about sponsorship identification in any programmatic political advertising.
Continue Reading Sponsorship of Political Advertising On-Air and On-Line – A Video Presentation and a Congressional Research Service Study

With the lowest unit charge window for the November elections going into effect on September 4, just two and a half weeks from now, we thought that it was a good idea to review the basic FCC rules and policies affecting those charges. In this election, with the Presidency and control in both houses of Congress at stake as well as many state offices, and with in-person campaigning limited by the pandemic, there may have never been a time when broadcast advertising was more important to political candidates – and likely more in demand by those candidates.  Your station needs to be ready to comply with the FCC’s political advertising rules. Today, we will look at lowest unit rate issues.  Lowest unit charges (or “Lowest Unit Rates”) guarantee that, in the 45 days before a primary and the 60 days before a general election, legally qualified candidates get the lowest rate for a spot that is then running on the station within any class of advertising time running in any particular daypart. Candidates also get the benefit of all volume discounts without having to buy in volume – i.e., the candidate gets the same rate for buying one spot as your most favored advertiser gets for buying hundreds of spots of the same class. But there are many other aspects to the lowest unit rates, and stations need to be sure that they get these rules right.

It is a common misperception that a station has one lowest unit rate, when in fact almost every station will have several – if not dozens of lowest unit rates – one lowest unit rate for each class of time in each daypart. Even at the smallest radio station, there are probably several different classes of advertising spots. For instance, there will be different rates for spots running in morning drive than for those spots that run in the middle of the night. Each time period for which the station charges a differing rate is a class of time that has its own lowest unit rate. On television stations, there are often classes based not only on daypart, but on the individual program. Similarly, if a station sells different rotations, each rotation that offers substantially different benefits to an advertiser will be its own class of time with its own lowest unit rates (e.g. a 6 AM to Noon rotation is a different class than a 6 AM to 6 PM rotation, and both are a different class from a 24-hour rotator – and each can have its own lowest unit rate). So, in the same time period (e.g. morning drive on a radio station), there may be spots running in that period that have multiple lowest unit rates (e.g.  spots may end up running in that period that were sold just for morning drive, as well as cheaper spots that were sold as part of a 6 AM to 6 PM rotation that just happened to fall within that period).  Federal candidates can buy into any of those classes of time, and they take the same chances as does a commercial advertiser as to where their spots will land (e.g. if a candidate buys a 6 AM to 6 PM rotator, and that rotator ends up in morning drive, another candidate may buy that same rotator the next week and end up at 4 PM. That second candidate can only guarantee that they will end up in morning drive by buying a spot guaranteed in that time period).
Continue Reading Lowest Unit Rate Window for the November Election Opens on September 4 – Thoughts on Computing Your Lowest Unit Charges to Political Candidates