Last week, the FCC’s Enforcement Bureau issued a Notice of Apparent Liability proposing an $8000 fine on a Los Angeles radio broadcaster that did not award a contest prize until over a year after the contest rules called for the prize to be delivered.  The contest rules called for the prize to be awarded within 30 days of a winner sending all required paperwork to the station.  As payments were made over a year after the end of the 30-day period provided by the contest rules, the Bureau concluded that the station had violated Section 73.1216 of the FCC rules which requires, among other contest rules, that a contest be conducted “fairly and substantially as represented to the public.”  The Bureau’s Notice cites to FCC precedent indicating that “timely fulfillment of the prize” is a material term in the contest rules which, when violated, represents a violation of the FCC rule.

The prize money that was awarded late was only $396, so some might think that a proposed fine of $8000 is excessive, though the Bureau indicates in a footnote that there were 98 prize winners in the same contest that did not timely receive their prizes.  The Bureau itself noted that the “base forfeiture” for a violation of the contest rules set out in the FCC’s schedule of fines is $4000.  But the proposed fine was adjusted upward in this case because the FCC perceived that, for a large company such as the licensee of this station, a $4000 fine might simply be seen as a cost of doing business, and not act as a sufficient deterrent against future bad conduct.  The FCC even noted that it had the power to fine the station for each day that the contest award was not made, which could have resulted in a fine of hundreds of thousands of dollars.Continue Reading FCC Proposes $8000 Fine for Failure to Award $396 Prize Within Time Period Set Out in the Contest Rules