Advertising Issues

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

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

From time to time, questions come up as to whether it is acceptable for broadcast stations to air ads from a political candidate which do not feature the voice or, for TV, the image, of the candidate.  Ads from Federal candidates should almost never be missing the recognizable voice or image, as there are Federal Election Commission rules that specifically put the requirement on the candidate to appear on the spots in the “Stand By Your Ad” disclaimer (“I’m John Smith and I approved this message”).  But sometimes ads from state or local candidates, in states where the Federal requirements have not been extended to local elections by the state legislature, may be missing the voice or image of the candidate.  What are the implications for stations in airing such ads?

The most important implication is in the potential liability of the station for the content of the political ad.  When an ad is a “use” by a candidate, the station cannot censor its content.  It must be run as it is delivered to the station.  Because a station cannot censor the ad, the station has no liability for the contents of the ad.  So if the candidate defames his or her opponent, or violates copyright law, the station cannot be held liable for the content of the ad.  We have written many times about this “no censorship” rule. As we wrote here, that rule (and virtually all of the political rules but for reasonable access) applies to state and local candidates just as it does to Federal candidates. 
Continue Reading Political Candidate Ads Without the Candidate’s Voice or Image – What is a Station to Do?

In the last few days, the trade press has been full of stories about a settlement of a lawsuit brought against a large broadcaster for alleged violations of the Telephone Consumer Protection Act (“TCPA”). Given that the settlement was for $8.5 million, it has commanded lots of attention. While much of this attention seems to suggest that this is a new obligation, we wrote about this issue last year, warning broadcasters of the potential for big liability if they did not pay attention to the requirements of the rules. The rules prohibit “telemarketing” calls or texts using an “autodialer” unless the recipient has explicitly consented to receive such messages.  In the recent decision, the broadcaster allegedly responded to texts sent to enter a contest with reply texts containing advertising messages unrelated to the contest. 

While TCPA rules are written by the FCC, this is one of those few rules where a violation can not only bring penalties from the FCC, but also there is a “private right of action” by people who receive unwanted calls or texts – i.e. they can sue a broadcaster who contacts them in a manner that violates the act.   And there are law firms that specialize in this litigation, even putting together groups of plaintiffs to bring actions against alleged violators – seeking damages including statutory damages (meaning that no real injury needs to be proven).  So just what does the TCPA cover? Here is what Josh Bercu, an attorney in my firm, wrote last August:

The TCPA is a law that restricts businesses and organizations from making calls and texts to consumers’ residential and wireless phones without having first received very specific permission from the recipient. Sending texts to broadcast station viewers or listeners who are contained in a station’s loyal listener or loyal viewer clubs can lead to liability if the proper releases are not obtained, and collecting text addresses from contest participants and adding them to station databases can similarly be problematic.   Because violations of the TCPA can result in civil liability of $500 to $1500 per call or text plus FCC fines, and as there have been a number of law firms around the country that have been active in filing class action suits against businesses to collect those potentially very high per-call damages, broadcasters need to ensure that their practices comply with the TCPA and the FCC’s rules which implement the Act.  While the recent Order provided some specific relief in limited circumstances to businesses, it leaves many well-intentioned companies, including broadcasters, at risk as they try to contact their viewers and listeners. Below we address some commonly asked questions about how the TCPA may apply to broadcasters.
Continue Reading Using Text Messages in Promotions and Contests? – $8,500,000 Settlement Provides Reminder to Make Sure You are Aware of TCPA Obligations

After last week’s Indiana primary, it appears that the Republican Party will be nominating Donald Trump as their Presidential candidate. While Hillary Clinton’s defeat in that primary may mean that the primaries continue to have meaning on the Democratic side, with apologies to supporters of Senator Sanders among our readers, most political commentators seem to believe that the likely Presidential matchup will pit Mr. Trump against Secretary Clinton in what will no doubt be a fascinating political race. From this past weekend’s news reports, it appears that there will be no shortage of heat in that race right up until the November election. Plus, with an unorthodox Presidential candidate heading the Republican ballot, there is some speculation that down-ballot races – including those for seats in Congress – may include real contests in districts that were previously considered to be safe for one party or another. With this confusing political landscape, what legal issues can a broadcaster expect to face in the upcoming election season?

We will start our discussion today with issues that may arise under the equal opportunities rule (sometimes referred to as requiring “equal time”) that generally requires that a station provide equal opportunities for the use of its facilities to competing candidates for any political office. We have written about that issue many times, including our general article on the topic here. Also, this topic is covered in our handbook for stations on the political broadcasting rules, POLITICAL BROADCASTING – Questions and Answers on the FCC Rules and Policies for Candidate and Issue Advertising. But let’s look today at some of the particular equal time issues that may come up this year.
Continue Reading With November’s Presidential Election Taking Shape – Likely Political Advertising Issues Ahead for Broadcasters – Looking at Equal Opportunities

E-Cigs and vape shops have become a new advertising category for many broadcast stations over the last few years. Unlike ads for cigarettes, little cigars, and smokeless (chewing) tobacco, which are effectively banned on broadcast stations, there are currently few Federal rules on e-cigs. Ads currently cannot make health claims about the product (so the ads cannot say that they are healthier than smoking cigarettes, nor can an ad even make the claim that e-cigs help users stop smoking). While some states have placed some additional restrictions on sales that carry over into advertising (e.g. age restrictions on sales), the Federal government, until this week, had passed on imposing more sweeping regulation on the industry.

In a “Final Rule” issued by the Food and Drug Administration yesterday (to be published in the Federal Register on Tuesday), a number of new requirements were adopted for tobacco products generally, and e-cigs were included in the FDA’s definition of tobacco products. So, too were cigars, pipe tobacco and tobacco used in water pipes or hookahs – tobacco products not covered by the over-the-air advertising ban that applies to cigarettes and smokeless tobacco. The new rules have a number of implications for the e-cig industry generally, including bans on sales to those under 18 and requirements that the FDA conduct “pre-market review” and approval of any new tobacco product introduced to the market in February 2007 or later. Of particular note for broadcasters are new requirements for health warnings in advertisements for all tobacco products, including e-cigs.
Continue Reading New Federal Advertising Rules on E-Cigs and Other Tobacco Products Adopted – To Become Effective within Two Years

To help broadcasters sort out the confusing rules about political advertising, we have updated our Political Broadcasting Guide for Broadcasters (note that the URL for the updated version has not changed from prior versions, so your bookmarks should continue to work). The revised guide is much the same as the one that we published two years ago, formatted as Questions and Answers to cover many of the issues that come up for broadcasters in a political season. This guide is only that – a guide to the issues and not a definitive answer to any of the very fact-dependent legal issues that arise in election season. But we hope that this guide at least provides a starting point for the analysis of issues, so that station employees have a background to discuss these matters with ad buyers and their own attorneys.

In looking at the Guide that we prepared two years ago, really not much has changed. But there are some specific updates that should be noted. For instance, sponsorship identification seems to be a hot issue in the last two years. We wrote here about the $540,000 fine paid as part of a consent decree when a Cumulus radio station did not fully identify the sponsor of advertising on a controversial issue of public importance. We have also written here and here about issues that are currently pending at the FCC about the proper sponsorship identification tag that belongs on an ad paid for by a PAC that is funded by one individual. This is an issue to which stations should be alert. The online public file for radio is mentioned, as this will affect how radio broadcasters maintain their political file starting at some point later this year (see our article here about the online public file requirements for radio broadcasters). Also, we note the adoption by many stations of programmatic selling, and suggest that stations need to carefully review how these sales platforms may impact lowest unit rate issues. We have made some other clarifications and revisions as well.
Continue Reading Updated Political Broadcasting Guide – Questions and Answers about Broadcasters’ Obligations During this Election Season

Two months ago, I wrote here about the risks of publishing ads or engaging in promotional activities that refer to the Super Bowl” without approval of the NFL. Now, with the NCAA Basketball Tournament about to begin, broadcasters, publishers and other businesses need to be multiply wary about potential claims arising from their use terms and logos associated with the tournament, including March Madness,® The Big Dance,® Final Four® or Elite Eight,® each of which is a federally registered trademark.

The NCAA Aggressively Polices the Use of its Trademarks

It has been estimated that, last year, the NCAA earned $900 million in revenue associated with the NCAA Basketball tournament. Moreover, its returns from the tournament have historically grown each year. Most of this income comes from broadcast licensing fees. It also has a substantial amount of revenue from licensing March Madness® and its other marks for use by advertisers. As part of those licenses, the NCAA agrees to stop non-authorized parties from using any of the marks. Indeed, if the NCAA did not actively police the use of its marks by unauthorized companies, advertisers might not feel the need to get a license or, at least, to pay as much as they do for the license. Thus, the NCAA has a strong incentive to put on a full court press to prevent non-licensees from associating their goods and services with the NCAA tournament through unauthorized use of its trademarks.
Continue Reading It’s March Madness! Know the NCAA’s Rulebook or Risk A Foul Call Against the Unauthorized Use of Its Trademarks

Broadcasters, like other federally regulated industries, continue to be leery about advertising for marijuana, even in states where cannabis dispensaries have been legalized for medical or even recreational use.  This week, the NY Times ran an article about companies trying to provide ways for dispensaries to use electronic payment systems, as federally regulated banks and credit card companies often refuse to deal with these businesses.  This is despite guidance given by the Department of Justice to banks about how to handle funds coming from such organizations.  Where the federal regulator (the FCC) has provided no advice whatsoever, broadcasters as regulated entities need to be very restrained in their desires to run ads for these dispensaries that appear to be legal under state laws.

Broadcasters are of course Federal licensees, and marijuana is still a controlled substance, illegal for sale to the public under Federal law.  While the current administration in Washington has said that enforcing marijuana laws against those who comply with state law is not an enforcement priority, it gave that advice provided a cannabis business observes very strict guidelines.  Strict Federal laws against any sale of marijuana remain on the books, and any search of the DOJ website provides numerous examples of legal actions brought against companies and individuals that don’t fit within those guidelines.  Plus, all it takes is a change in enforcement priorities by the Federal government and even dispensaries that are legal under state law can be closed by Federal actions.  And even if the priorities don’t change, the Department of Justice suggestions to Federal prosecutors don’t stop individual prosecutors from taking actions, especially if the cannabis-related business is found to have violated some other law or if it is acting outside of the strict limits that the DOJ set out in suggesting prosecutorial restraint.  Promoting a business that is not legal under Federal law is dangerous. 
Continue Reading The Murky State of Rules on Broadcast Advertising of Marijuana Products in States Which Have Legalized its Sale or Use

According to Politico, Ted Cruz’ campaign has demanded that TV stations pull certain PAC ads which he claims distort his voting record on immigration issues. This kind of claim from a political candidate about the unfairness of attack ads is common. Here, Cruz’ representatives apparently don’t threaten lawsuits against the stations for running the ads, but suggest that it is a violation of the stations’ FCC obligations to operate in the public interest to continue to run the ads. What is a station to do when such a claim is received?

We have written many times about this issue. Much depends on who is sponsoring the attack ad. If the ad is sponsored by the authorized campaign committee of another candidate, and features the voice or image of the sponsoring candidate, the station cannot do anything. As we wrote in detail here, a station cannot censor a candidate ad. Once it has agreed to sell time to a political candidate or his or her authorized campaign committee, the station must run the ad as delivered by the candidate without edit (with the very limited exception of being able to add a sponsorship identification if one is missing, or when running the ad would constitute a felony, e.g. running a spot that is legally obscene – not just indecent but obscene, meaning that it has no redeeming social significance). Because the station is required to run the ad as delivered by the candidate, the station has no liability for the content of the ad. So, if the candidate being attacked complains, the station can do nothing to edit, censor or pull the attacking candidate’s ad without violating the “no censorship” provisions of Section 315 of the Communications Act. The candidate being attacked has a remedy against the ad’s sponsor, not against the station. Third party ads, however, are different.
Continue Reading Ted Cruz Demands Takedown of PAC Ad Attacking His Voting Record – Issues that Broadcast Stations Need to Consider When Threatened by Candidate Wanting an Ad Pulled