FCC Fines

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On Friday, the FCC released an Order and Consent Decree by which Journal Broadcasting agreed to pay a fine of $115,000 and to enter into a compliance program to settle complaints that it had not adequately identified that a program aired on its Las Vegas TV station was sponsored by a local car dealership.  According to the FCC press release issued at the same time as the Order and Consent Decree, the program was labeled a “Special Report,” was hosted by a station employee who stated that she was “reporting on behalf of Channel 13,” was made to look like a news report (with the reporter interviewing various employees of the dealership about their liquidation sale), and was run immediately adjacent to the local news.  The Press Release stated that this action was important to insure “transparency” where consumers are not misled as to who is trying to persuade them about commercial product.  “[A] pseudo news report invites viewers to rely on their perception of the station’s independence and objectivity when, in fact, the message has been bought and paid for by an undisclosed third party,” stated the FCC in the press release.

While the licensee argued that the context of the program made clear that it was a sponsored ad, the Commission’s insistence on the payment of a fine here is evidence of much the same thinking as the decisions the FCC has reached in past cases where there was entertainment or informational programming presented without a sponsorship identification even where the programming was sponsored by a commercial entity.  Even simply providing a recorded program unduly promoting a commercial product has been found to be sufficient to trigger the FCC’s requirement that a sponsor be identified when a station receives valuable consideration for the airing of a program broadcast to the public (see our article here).
Continue Reading TV Station Agrees to $115,000 FCC Fine for Not Identifying Sponsor of Program Promoting a Sale at Auto Dealership

In a Consent Decree released the day after Thanksgiving, the FCC agreed to accept a payment of a $35,000 penalty from a former television licensee for recording two telephone conversations for inclusion in a newscast, where the station called an outside party and recorded those conversations for inclusion in the newscast – before getting permission to do the recording.  The licensee also apparently did not fully respond to FCC inquiries about the facts of the case, leading to the $35,000 fine.  The FCC noted that the licensee had already sold the station, and was holding this money in a post-closing escrow account to be used to satisfy any fines that might arise from this conduct.

The decision is significant for several reasons.  First, it is couched in terms of privacy regulation, with a discussion of the importance of privacy regulation to the FCC in the opening paragraph (see the Public Notice that accompanied the release of the Consent Decree).  Recently, the FCC issued huge fines to independent telephone companies for not properly securing customer information – indicating a new emphasis on privacy regulation by the FCC.  Couching Friday’s consent decree in those terms indicates that privacy issues are now a high priority for the FCC.  As we have written before, privacy is a subject of interest to many other government agencies, and the recent interest of the FCC in this issue promises one more place where businesses can look for trouble should they respect the privacy of those with whom they interact, or should they not secure private information about their customers.
Continue Reading $35,000 FCC Fine for TV Station that Tapes Telephone Conversations for News Broadcast Without Prior Permission

While we are in the Holiday season, the regulatory obligations faced by broadcasters don’t stop.  December brings a continuation of the TV renewal cycle, though we are nearing the end of that cycle.  Renewal applications for all TV, Class A and LPTV stations in the following states are due on December 1: Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont.  These stations need to file their first two post-filing license renewal announcements on the first and 16th of the month.  Stations that filed their license renewal applications in October also will be broadcasting their post-filing announcements on those same days (their last two announcements).  Those would be stations in the following states and territories: Alaska, Hawaii, Oregon, Washington, American Samoa, Guam, the Mariana Islands, and Saipan.  TV stations in the states that file license renewals on February 1 (those in New York and New Jersey) have to start running their pre-filing announcements on the December 1 (and run a second on December 16).

There are other routine filings due in December.  On December 1, Commercial and Noncommercial Full-Power and Class A Television Stations and AM and FM Radio Stations with employment units with 5 or more full-time employees in Alabama, Colorado, Connecticut, Georgia, Maine, Massachusetts, Minnesota, Montana, New Hampshire, North Dakota, Rhode Island, South Dakota, and Vermont all need to complete their EEO Public File Report and place that report in their public file (and on their websites, if they have one).  Noncommercial stations still have obligations to file Biennial Ownership Reports on every other anniversary of the filing of their license renewal applications.  That means that these reports are due on December 1 for Noncommercial Television Stations in Alabama, Connecticut, Georgia, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont; and on the same day for Noncommercial AM and FM Radio Stations in Colorado, Minnesota, Montana, North Dakota, and South Dakota.
Continue Reading December Regulatory Dates for Broadcasters – Renewals, EEO Reports and Noncommercial Biennial Ownership Reports in Some States; TV Ancillary and Supplementary Revenue Reports; As Well as LPTV Rulemaking Comments and Many Other Expected Actions

The FCC on Friday proposed to amend its rules governing contests conducted by broadcast stations by allowing the required disclosure of the material terms of the contest on the Internet, as an option for broadcasters in lieu of the current requirement that these disclosures be made by broadcasting them on-the-air a reasonable number of times.  But the proposed rule change is not as simple as one would think, with the FCC asking about whether a number of specific obligations should be attached to any online disclosures, even potentially adding the requirement that the full URL for the online disclosure be made every time a contest is mentioned on the air, not simply a reasonable number of times as required under the current rules.  So just what is the FCC proposing, and what is the big issue here?

The rule governing the conduct of broadcaster’s contests, Section 73.1216, covers contests conducted by broadcasters over-the-air.  It does not cover contests by broadcasters that are exclusively conducted online (though, as we wrote here, if the contest is announced on the air, even if primarily conducted online, all the required on-air disclosures apply).  It does not cover contests conducted by third-parties that are broadcast on the air (so contests conducted by an advertiser are not covered by this rule).  The current rule, in addition to requiring that the contest be conducted fairly and in accordance with the rules adopted for the contest, requires that the “material rules” be broadcast on the air on a regular basis so that listeners know what they might win, how to play the contest, and how the winner is selected.  It is this requirement, that the material rules be broadcast on the station, that has led to problems in the past, and thus prompted the proposed changes advanced on Friday.
Continue Reading FCC Proposes To Amend Rules Governing Broadcast Contests – Suggests Allowing Disclosure of Material Terms of the Contest on the Internet

Since our note Friday about November regulatory dates for broadcasters, it’s become clear that the FCC will be acting on two more matters of interest to broadcasters – particularly radio broadcasters though each have some implications for TV as well.  First, as we hinted at the end of our article on Friday (the rumors that we had heard having now been confirmed), Chairman Wheeler has circulated a draft Notice of Proposed Rulemaking on the expansion of the online public file to radio (as well as cable and satellite).  And, secondly, the FCC has announced that, at its open meeting on November 21, it will open a rulemaking to modernize the disclosure rules for on-air contests conducted by broadcasters – rules which have resulted in FCC fines over the last few years.

The fact that the online public file proposal for radio has now matured into a Notice of Proposed Rulemaking is confirmed by the FCC’s list of Items on Circulation (basically, draft orders that the Commissioners currently have in front of them for review and voting), which now lists that item near the top of its list.  See the list of Items on Circulation, here: http://www.fcc.gov/fcc-items-circulation.  While most folks in radio knew that the day would come when their public files might be required to go online, the speed with which the FCC now seems to be acting is what is most surprising, as it was only a bit over two months ago that the FCC took comments on whether or not to even consider that proposal (see our article here).  But, with lightning speed, the order appears to be moving forward.  How fast will it be implemented?
Continue Reading Formal Proceedings to Begin to Revise Rules for Broadcasters’ On-Air Contests and Expand the Online Public File Obligations to Radio, Cable and Satellite

The FCC yesterday issued an order imposing a $2.25 Million fine on a set of companies that operated a system that retransmitted TV signals to households in large housing units in the Houston area.  The system had paid retransmission consent fees to the TV stations, then stopped doing so, claiming that it was changing so as to operate as a Master Antenna Television System (MATV).  MATV systems are exempt from paying retransmission consent fees under certain defined circumstances.  This exemption was adopted for apartment complexes and other large residential dwelling units to allow residents to receive over-the-air television so as to not force all of the residents to have an antenna in their own residential units, which might not be feasible or optimal for TV reception.  The problem in yesterday’s case, according to the FCC decision, was that this company did not in fact act as an MATV system, but instead continued to deliver its programming to the dwelling units by means of its fiber connection to a single headend, where TV programs were bundled with traditional cable network programming.  According to the decision, the system continued to transmit TV signals through its fiber network for as much as 208 days after the expiration of the retransmission consent agreements with the TV stations whose signals it was carrying.

FCC rules require that cable systems and other MVPDs (multichannel video programming distributors) receive the consent of TV stations before retransmitting their signals.  The exception for MATV systems is a limited one. It provides that the signals of TV stations be made available to the residents of the dwelling units that are served “without charge and at the subscribers (sic) option” and that the receiving device be either owned by the subscriber or building owner, or “available for their purchase upon the termination of service.”  The Commission further faulted the service for apparently having continued to deliver TV programming to subscribers by its fiber service from its headend, even after installing master antennas at the buildings in which the subscribers lived.  Simply having the antennas available was not enough to excuse the system from the retransmission consent obligations when the actual signals were sent by fiber. 
Continue Reading FCC Fines Cable System $2.25 Million for Retransmitting TV Stations Without Consent

The FCC has recently staked out a policy that the any use of EAS tones, or tones that sound like those alerts, outside of a real emergency, will lead to big fines.  Since the beginning of the year, the FCC has issued notices proposing fines totaling over $2.2 million against some of the biggest media companies in the country for such violations (see this decision proposing a $300,000 fine against Turner Broadcasting System Inc. for tones mimicking the EAS alerts that were included in a commercial transmitted nationwide in cable network programming, and this decision imposing cumulative fines of over $1.9 million on 3 cable network programmers for transmitting ads for the movie Olympus Has Fallen that included portions of the EAS alert tones).  Only days after the latter decision, a new warning about EAS tones or sound effects made to mimic those tones was sent out by the Southern California Broadcasters Association alerting broadcasters to a commercial for a charcoal briquettes company that seemingly contained such tones.  Given the strict liability that the FCC has been imposing for such commercials, watch for this recent ad and any other programming that might contain EAS tones or anything that sounds like them – and keep them off the air. 

With past warnings on this issue (see our article from November about another set of FCC fines for similar broadcasts,  and the release of an FCC press release warning media companies about the issue) and the recent large fines imposed on major media companies – both broadcast and cable – it is clear that all media companies need to be on the alert to monitor their broadcast material for the any content sounding like EAS alerts, and advertisers and program producers need to be aware that anything they produce that contains the alert tones is likely to cause problems at the FCC.  Note that these recent decisions imposed penalties on cable networks – so it is not just licensees who need to be vigilant.  In these decisions, the FCC has rejected any arguments that the media companies that transmitted the advertising containing the alert tones should be excused from liability as they did not themselves produce the ads.  So watch for these tones – even if they are packaged in someone else’s programming. 
Continue Reading Be on the Alert for EAS Tones in Non-Emergency Situations – Big FCC Fines for These Violations and Other EAS Issues

In a decision released this week, the FCC fined a Chicago radio station $44,000 for omitting sponsorship identification announcements on 11 on-air spots promoting the positions of the sponsoring organization on certain issues facing the local community.  Finding that the purpose of the sponsorship identification rules (Section 317 of the Communications Act and Section 73.1212 of the FCC rules) is to allow the station’s listeners to know who is trying to convince them of whatever is being broadcast, the FCC’s Enforcement Bureau decided that each of the violations would be assessed the base fine of $4000 – meaning that there was a total fine of $44,000.

We wrote about the original Notice of Violation in this case two years ago, here.  In a two month period, the station had run a series of paid announcements on behalf of an organization called Workers Independent News (“WIN”), addressing social and political issues.  The announcements consisted of 45 90-second spots, 27 15-second promotional announcements, two two-hour programs, and one one-hour program.  All but 11 of these announcements had proper sponsorship identifications.  Even those 11 announcements identified the announcer as being with WIN, but they did not specifically say that the 11 spots had been “paid for” or “sponsored by” by the organization.  That alone was enough to prompt the fine.  But $44,000?
Continue Reading $44,000 Fine for 11 Missing Sponsorship IDs for Radio Station 45 Second Spots – Emphasizes Importance of Strict Compliance with All FCC Programming Rules

In a decision released yesterday, the FCC proposed to fine a station and gave it a short-term license renewal as the station could not demonstrate that it had served the needs and interests of its community.  Why?  Because the station had been silent for much of the renewal term – only turning on for a short time every now and then – enough to avoid having its license cancelled for being silent for more than a year.  Several years ago, Congress amended the Communications Act to add Section 312(g) requiring that the FCC cancel a station’s license if it has been silent for more than a year, unless the station can demonstrate some overriding public interest reason for leniency (a showing that, as we wrote here, is difficult to make). 

To avoid the ultimate sanction of having a license cancelled, many stations facing economic issues or other long-term problems with transmitter sites or other matters, will find a way to turn their stations back on the air for a day or two to avoid being off the air for more than a year.  As long as programming is run on the station during that on-air period, the FCC has thus far allowed the stations to continue in this mode.  But, in this license renewal cycle, broadcasters were for the first time required to specify if their stations had been of the air for more than 30 days at any point in the license term.  In yesterday’s decision, the FCC makes clear that a station that spent a significant amount of time off the air may face a sanction – here, the grant of the license renewal for only 2 years rather than the normal 8 year period.  If a station is off the air for more than half the renewal term, it looks like an even more serious sanction may be in the works.
Continue Reading Radio Station Being Silent Too Long Brings FCC Sanction – How Long Can a Broadcast Station Be off the Air Before It Causes Trouble at License Renewal Time?

Last night’s Super Bowl didn’t offer much in the way of excitement on the field, as the game was seemingly over by the end of the first half.  But, for the last decade, the half-time show itself may offer some anxiety to the stations carrying the game.  10 years ago, Janet Jackson had her infamous Super Bowl wardrobe malfunction incident which started a firestorm at the FCC for the next several years, as it ignited  many calls to more aggressively regulate indecency on the airwaves.  As a result of the incident, a number of fines were meted out for this program and to many others that aired soon thereafter.  But, in reality, what the incident did was to highlight just how difficult it is for the FCC to enforce any sort of indecency rules, as the issue raised at that time continue to be debated at the FCC right up to the present day.

As we have written before, the FCC policy that was applied to the Janet Jackson incident is one that is still in a state of limbo, as the FCC has issued a request for public comment on whether it should limit its enforcement to cases where there are egregious violations of the indecency policy rather than those that last a fraction of a second, as was the case in the Janet Jackson Super Bowl incident.  This need for reexamination arose after the Supreme Court decided that the FCC’s crackdown on any indecency, even “fleeting expletives”, was not adequately explained as it departed from prior FCC policy that understood that, on occasion, mistakes happen.  As long as the error causing something arguable indecent to be broadcast wasn’t repeated or planned, there would be no substantial penalty.  But even the common sense reform which essentially stepped back to the prior policy of recognizing that mistakes happen gave rise to many protests that the FCC should not back down on its tough indecency enforcement. 
Continue Reading Ten Years After Janet Jackson’s Super Bowl Clothing Malfunction, FCC Indecency Rules Remain in Limbo