FCC Fines

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For an industry that some say is about to be made obsolete because of its digital competition, there are still many people who want a piece of the FM spectrum.   We’ve written much about the contest between LPFM and translator proponents seeking their piece of FM spectrum – a contest that we should see resolved by the FCC in the very near future. One topic that we have not written much about is "pirate radio," stations that operate illegally – without FCC authority.  This week, the FCC issued several orders, fining individuals up to $25,000 for operating pirate radio stations in various places around the country (see decisions here and here, and two other fines of $20,000 or more noted below).  Pirate radio has been and remains a big problem for many broadcasters and, despite the fines in cases like this, pirates seem to continue to crop up – especially in urban markets.

The pirate radio problem has always been with broadcasters.  In the past there was both the romance of the outlaw radio operator and concerns over the snake oil salesmen who were broadcasting from stations in Mexico, and there was a famous religious broadcaster who lost a battle with the FCC over the Fairness Doctrine in connection with a real radio station and then resumed operations from a boat off the coast of New Jersey.  But in the last 20 years pirates have been much more localized, low power operators, trying to reach audiences largely in urban areas. Despite a series of court decisions rejecting any First Amendment claim of pirates, and denying any claim that these low-power, local stations did not implicate the FCC’s power over interstate commerce regulation, pirates have never gone away.  In many ways, the FCC introduced the concept of Low Power FM stations in the 1990s as a way to provide an outlet for those who might otherwise be inclined to operate an unlicensed station.  In fact, one of the big arguments at the time of the initiation of LPFM was whether former pirate radio operators should be allowed to apply for LPFM stations.Continue Reading Pirates, Pirates Everywhere – Fines Up to $25,000 for Unlicensed Radio Stations

Fines of $14,000 and $8,000 were proposed by the FCC for violations of its EEO rules in two cases (here and here) released on the FCC’s last business day of the year.  In both cases, the fines were issued as these clusters of stations, on the FCC Form 396 EEO Reports filed with their license renewal applications, publicized a number of job openings without adequate recruitment.  In the cases faulted by the FCC, the stations’ recruitment relied solely on either internal station sources (e.g. word of mouth, referrals from existing employees, ads on the stations or on their own websites) or on on-line resources.  The Commission concluded that this was inadequate dissemination of the information about these openings.  Based on the failure to engage in broad outreach for all of their job openings, these fines were issued by the FCC – perhaps the first of more to come as the FCC reviews license renewal applications during the current license renewal cycle.  Perhaps coincidentally, the FCC will be conducting a webinar on its EEO rules on Wednesday, January 4, which is intended to help explain the obligations of broadcasters and other FCC regulated entities under these rules.

 The January 4 webinar will feature two panels.  The first will be a panel of FCC and private attorneys (I will be one of the participants) who will outline the legal obligations of broadcasters under the FCC’s EEO rules and policies and discuss how these rules are applied .  A second panel will feature industry representatives talking about EEO compliance best practices at their stations.  The webinar is free, but requires registration (here).  The FCC public notice of the webinar can be found here, and a further description of the seminar is available on its blog (here).  No doubt, the issues leading to the two fines announced on Friday will be discussed during the legal session.Continue Reading FCC Fines Up to $14,000 Proposed for License Renewal EEO Violations, Commission To Hold Webinar to Explain Its Rules

Last week, I did a presentation on the issues facing broadcasters at the Kansas Association of Broadcasters annual convention (a copy of the slides from my presentation is available here).  I spoke about some of the day-to-day issues that can get broadcasters into trouble, as well as some of the big policy issues that broadcasters need to consider.  My presentation was preceded by a session conducted by the agent in charge of the Kansas City field office of the FCC, who emphasized the many issues that the field agents discover at broadcast stations that can lead to fines.  In the week since I returned from Kansas, it seems like the FCC has wanted to demonstrate the examples given by their agent, as there have been a large number of fines demonstrating the breadth of technical issues that broadcasters can face.  Fines (or "forfeitures", as the FCC calls them) were issued or proposed for issues ranging from faded tower paint, tower light outages, EAS problems, operations with excess power, and the ubiquitous (and very costly) public file violations.  Fines of up to $25,000 were issued for these violations – demonstrating how important it is not to overlook the day-to-day compliance matters highlighted in my presentation.

The largest of these fines was for $25,000.  This fine was imposed on a station for failing to have operational EAS equipment, not having an enclosed fence around the antenna site, and a missing public file.  The fine was originally proposed in a Notice of Apparent Liability (the first step in imposing an FCC fine, when the FCC spells out the apparent violation and the fine proposed, and the licensee is given time to respond to the allegations), released in July (see our post here).  The licensee failed to respond to the Notice of Apparent Liability, thus the fine is now being officially imposed.Continue Reading A Host of FCC Fines of Over $20,000 for Technical and Tower Issues – And a Presentation on How to Avoid FCC Problems to the Kansas Broadcasters

The Third Circuit Court of Appeals today issued its decision in the case dealing with the FCC’s fine for the Janet Jackson "clothing malfunction" Super Bowl incident.  The Court once again rejected the FCC decision – essentially upholding a 2008 decision that had found the FCC’s indecency fine to be an arbitrary departure from prior precedent.  The…

Noncommercial broadcasters get no breaks when dealing with proposed FCC fines, said the Commission’s Media Bureau in two cases released this week.  While many noncommercial broadcasters may yearn for a day when they were treated leniently if violations were discovered – getting off with perhaps an admonishment letter – those days are over, as they have been for some time. In one case released this week, the FCC specifically states that noncommercial broadcasters are no different than commercial ones when dealing with fines (or "forfeitures" as they are called by the FCC).  If the noncommercial broadcaster violates a rule, they will be treated just like a commercial broadcaster, and have to pay the same fine as would the commercial broadcaster.  

Noncommercial broadcasters have often argued that they cannot afford to pay big fines, as their budgets are limited.  Even when noncommercial stations are owned by colleges or local governments, they have limited budgets, and fines don’t figure into them.  But, in two recent cases, the FCC has rejected arguments for the reduction of proposed fines based on financial hardship, in both cases finding that the budget of the station was not important – it is the total budget of the licensee that is important in assessing if a fine is too much (see our post about how the FCC determines if a fine should be reduced because its payment would create a financial hardship on a station).  In the case cited above, the FCC said that it was the local government agency (a metropolitan school district) that was the licensee, and its financial resources should have been assessed in determining whether the proposed fine was too great.  In a second case, it was a state university that owned the station, and the FCC said that it would look to the overall finances of the university in determining if the fine was too high – not the amount budgeted for the station.  In neither case had the licensee put forward a financial showing for the full licensee organization, so the FCC rejected the requests for reductions of the fines based on financial hardship.Continue Reading FCC Makes Clear Noncommercial Broadcasters Get No Breaks on FCC Fines, Nor on Financial Hardship Showings

The failure to follow FCC filing rules when a station finished construction of new facilities under a construction permit will apparently cost a radio station $7000 according to a recent Notice of Apparent Liability released by the Commission’s Media Bureau.  Before a broadcast station can make most changes to its technical facilities, it must apply to the FCC for approval, which the FCC grants by way of a construction permit.  In most cases, the broadcaster has 3 years to construct the proposed facilities.  Once construction is complete, the broadcaster must notify the FCC of that fact by filing an application for a license on FCC Form 302.  That form gives details of the construction, so that the FCC can tell that the station was built in the manner authorized by the construction permit, and in accordance with any conditions placed on construction in the permit.  In this case, the broadcaster built the new facilities that it proposed within the 3 year period, but forgot to file the Form 302 – and only did so 3 years after the end of the construction period.  Under this Notice, the late filing, and the failure to ask for special temporary authority ("STA") to operate the station after the failure to file was discovered, may cost the station $7000.

In the past, the FCC had allowed some stations to file their license application late, if construction had occurred in a timely fashion, and where the licensee provided proof of the timely construction.  In this decision, the FCC found that these cases were situations where the late filing was for an insignificant period of time – a few days or weeks at the most, not for the years that went by in the case here.  The late filing, and the fact that, as the construction permit had expired and no license had been granted, the station was deemed to have been operating without authority at the new site, warranted the $7000 fine in the FCC’s opinion.  The case not only serves as a reminder to those with construction permits to file their license applications on time after they complete construction, but also shows that while the FCC may show some flexibility in enforcing its procedural rules, it will not allow licensees to ignore them for long periods.  So be careful to meet the requirements of the rules, or look for big fines from the Commission. Continue Reading $7000 Fine for Radio Operator Who Builds Construction Permit But Forgets to File a License Application

A consent decree entered into by a radio broadcaster, which included a $12,000 "voluntary contribution" to the US Treasury, demonstrates once again the FCC’s concerns about sponsorship identification issues.  The week before last, we wrote about the FCC fine levied on a television broadcaster for not including sufficient sponsorship information when a "video news release" was broadcast on a local television station without disclosing that the video footage had been produced by the automobile company whose products were featured.  The recent FCC Report on the Information Needs of Local Communities (formerly known as the Future of Media report) also focused on the need for more disclosure in connection with sponsored material carried on broadcast stations and other media (see our summary here).  With a long outstanding Rulemaking proceeding on these issues that remains unresolved (see our summary here), the Commission almost appears as if it is setting its policies in these areas through case law rather than through the rulemaking process.

In this most recent "payola" case, a complaint was lodged against a Texas radio station owned by Emmis Broadcasting alleging that the host of one music program was receiving compensation from a local music club, a local record store, and a manager of local bands in exchange for featuring music on the show.  The allegation contended that other local bands could not get their music played on this show without sponsoring Station events hosted by this particular personality.  The Consent Decree does not resolve the question of whether these allegations were true, but instead requires that the licensee make the voluntary contribution, adopt procedures to make sure that Station employees are aware of the requirements of the sponsorship identification rules, and report  to the Commission on a regular basis on the actions taken by the licensee to ensure compliance with the FCC rules.  In addition to general requirements that the Station educate its employees about the sponsorship identification rules, the Consent Decree also contained conditions setting forth rules governing the relationship that station employees could have with record labels, even though the decree makes no mention of any allegations of improper consideration having come from record companies.  These conditions were ones that appear to have come from consent decrees entered into with a number of broadcasters 4 years ago in the last major FCC payola investigation (which we wrote about here).Continue Reading $12,000 Consent Decree Payment Demonstrates FCC Concerns About Sponsorship Identification Policies