FCC Fines

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

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 $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?

While TV broadcasters can enjoy an incentive auction respite in July as attention shifts to the “forward auction” where we will see whether wireless carriers come up with enough money to fund the $86,422,558,704 (plus $1.75 billion for repacking costs, plus auction-related administrative costs) needed for the buyout of TV stations who agreed to surrender their spectrum, radio broadcasters will get some of their own attention as, at the end of the month, the second window for the filing of 250-mile waiver applications opens for Class A and B AM stations. We wrote about these waivers here, which allow an AM licensee to acquire an FM translator and file an application to move it up to 250 miles and operate it on any commercial frequency that does not create interference in their market. That window for Class A and B AM stations opens July 29 and runs through October 31 (and remains open for any other AM that has not already filed one of these waivers in the first window which opened back in January).

In addition to the AM window, there are routine filing deadlines for all TV stations – required to file their FCC Form 398 Children’s Television Reports by the 11th of the month (because the 10th of July is a Sunday) demonstrating the educational and informational programming they broadcast directed to children. By the 10th television stations also need to upload information into their online public files to demonstrate compliance with the limits on commercial time in children’s programs.
Continue Reading July Regulatory Dates for Broadcasters – FM Translators for Class A and B AMs; Quarterly Issue Programs and Children’s Television Reports; Comments on EAS, Letters from the Public and Regulatory Fees, Cable Royalty Claims; and More

As we’ve written many times (see, for instance, the articles here and here), today is the day that the FCC’s new online public inspection file goes live.  For TV stations, the system is supposed to be more dependable and user friendly.  For radio, commercial stations in the Top 50 Nielsen radio markets are…

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

In an FCC decision fining a TV station $10,000 for failing to include 15 Quarterly Issues Programs lists in its public inspection file, the FCC refused to reduce the proposed liability based on an intervening “long-form” transfer of control followed by a short-form assignment of license of the station. Thus, even though the station was no longer controlled by the same individuals who controlled the station at the time of the violation, and even though the licensee company was different, the fine still applied.

The Media Bureau decision looked at precedent that has held that a transfer of control of a station, even a “long-form” application on FCC Form 315 that is subject to public notice and a 30 day waiting period during which the public can comment on the change in control of the licensee, does not excuse the licensee for violations of the FCC’s rules that occurred prior to the transfer. We wrote about a similar holding in another case last year. The FCC’s view is that, when you are buying the stock of a company, you acquire not only the assets of the company but also its obligations, including any potential FCC violations. This is different from an assignment of license filed on a Form 314 (also a “long-form” application subject to a 30-day public comment period) – where a buyer just buys the assets through a new company and does not assume the liabilities – a difference that the FCC has recognized in these cases. In the decision reached today, the licensee attempted to exploit that different treatment – but the FCC rejected the distinction.
Continue Reading Fine for Missing Quarterly Issues Programs List Not Excused by Intervening Transfer of Control of TV Station – Buy Assets Not Stock to Avoid Assuming Prior Owner’s FCC Liabilities

Pirate radio is still a problem. While pirate radio was much in the news a decade ago, and was even glamorized in movies, the popular perception may be that it has disappeared. In fact, particularly in major urban areas, it is still a major issue – causing interference to licensed broadcast stations and even, at times, to non-broadcast communications facilities. The FCC yesterday upheld a previously issued $15,000 fine to an operator of an illegal station in Florida, rejecting arguments that the community service provided on the station should mitigate the fine. The FCC, from time to time, releases this sort of fine, yet these stations keep popping up. A number of Commissioners have recognized the gravity of the issue, and that recognition caused the FCC to last month issue an Enforcement Advisory, warning operators that unauthorized broadcasting is illegal, suggesting that the public turn in those who operate pirate stations, and warning those who support pirate radio (e.g. landlords and advertisers) that their support could “expose them to FCC enforcement or other legal actions.” What is the reality of this actually happening?

A few states, including New Jersey and Florida, have passed criminal statutes making pirate radio illegal, but such enforcement, in the few cases that I have dealt with in those states, has tended to be a low enforcement priority for state authorities. Most defer to the FCC, given their perceived expertise in this area. Thus, there has been a recognition that the FCC needs to do more to combat pirate radio, particularly in urban centers like New York where the problem has been particularly acute. I had the privilege of interviewing FCC Commissioner Michael O’Rielly at the Oklahoma Association of Broadcasters convention the week before last. The Commissioner has been an outspoken advocate of more pirate radio enforcement. In addition to early support for public education on the issue, including the issuance of the Enforcement Advisory, the Commissioner suggested that additional Congressional action may be necessary to give the FCC more enforcement tools to really bring pressure to bear on pirate radio operators and those who support them. What tools are needed?
Continue Reading Combatting Pirate Radio – What Can the FCC Do?

A Washington Post article published this weekend was titled “Is there anything you can’t say on TV anymore? It’s complicated.” And, it really is. The Post article presents a very good overview on the status of the FCC’s indecency rules. What will happen with those rules has been a matter of conjecture for several years, ever since the Supreme Court threw out the fines that the FCC had imposed for fleeting expletives that had slipped out in the Golden Globes and other awards programs, a case that also had the effect of negating that other fine for a “slip,” the notorious Janet Jackson clothing malfunction during her Super Bowl performance. Other than a well-publicized $325,000 fine on a Roanoke TV station for a short but very explicit image that slipped into the corner of a news report on a porn star turned first responder (see our article here on the Roanoke case), the FCC has been largely quiet on the indecency front since it launched a post-Supreme court proceeding to determine how they should amend their rules in light of the Court’s decision (see our summary here).

As we wrote when comments were filed in that proceeding, it drew much attention, with many commenters fearing that the FCC would back away from all indecency regulation on broadcast TV. In an election year like this one, don’t expect in the near future to see any definitive answers as to what is indecent and what is not. Neither political party wants to be tagged with being pro-smut by one side of the political spectrum, or anti-First Amendment expression by the other. But the Post article raises other very interesting questions about the difference in legal treatment between cable and broadcast programming, especially when so many viewers hooked up to some cable or satellite service don’t really understand the difference between cable network programming and that from broadcast sources.
Continue Reading Looking at the FCC’s Indecency Rules – Does Anyone Know What’s Prohibited and What’s Permitted?

In a Notice of Apparent Liability released yesterday, the FCC proposed to fine a TV station $20,000 for being late in the filing of 4 years of Quarterly Children’s Television Programming Reports (FCC Form 398). While the penalty is consistent with the size of penalties that the FCC has been imposing for similar…

With April Fools’ Day only a few days away, we need to play our role as attorneys and ruin the fun by repeating our annual reminder that broadcasters need to be careful with any on-air pranks, jokes or other bits prepared especially for the day.  While a little fun is OK, remember that the FCC does have a rule against on-air hoaxes – and, while issues can arise at any time, broadcaster’s temptation to go over the line is probably highest on April 1.  The FCC’s rule against broadcast hoaxes, Section 73.1217, prevents stations from running any information about a “crime or catastrophe” on the air, if the broadcaster (1) knows the information to be false, (2) it is reasonably foreseeable that the broadcast of the material will cause substantial public harm and (3) public harm is in fact caused.  Public harm is defined as “direct and actual damage to property or to the health or safety of the general public, or diversion of law enforcement or other public health and safety authorities from their duties.”  Air a program deemed a hoax, and expect to be fined by the FCC.

This rule was adopted in the early 1990s after several incidents that were well-publicized in the broadcast industry, including one case where the on-air personalities at a station falsely claimed that they had been taken hostage, and another case where a station broadcast bulletins reporting that a local trash dump had exploded like a volcano and was spewing burning trash.  In both cases, first responders were notified about the non-existent emergencies, actually responded to the notices that listeners called in, and were prevented from responding to real emergencies.  In light of this sort of incident, the FCC adopted its prohibition against broadcast hoaxes.  But, as we’ve reminded broadcasters before, the FCC hoax rule is not the only reason to be wary on April 1. 
Continue Reading In Thinking About April Fools’ Day Pranks, Remember the FCC’s Hoax Rule and other Potential Liability