Late last week, the US Court of Appeals for the Fourth Circuit issued a decision in a case called Washington Post v. David J. McManus, upholding the ruling of the US District Court finding that the State of Maryland’s attempts to impose political advertising reporting obligations on online platforms to be an unconstitutional abridgment of these companies’ First Amendment rights.  The suit was brought by the Washington Post and several other companies owning newspapers with an online presence in the State.  Their arguments were supported by numerous other media organizations, including the NAB and NCTA.  The Maryland rules required that online advertising platforms post on their websites information about political ads within 48 hours of the purchase of those ads.  That information had to be maintained on the website for a year and kept for inspection by the Maryland Board of Elections for a year after the election was over.  The appeals court concluded that the obligation to reveal this information was forcing these platforms to speak, which the court found to be just as much against the First Amendment as telling them to not speak (e.g., preventing them from publishing).  As the court could find no compelling state interest in this obligation that could not be better met by less restrictive means, the law was declared unconstitutional.

The Maryland law required the following disclosures on the website of a platform that accepted political advertising:

  • the ad purchaser’s name and contact information;
  • the identity of the treasurer of the political committee or the individuals exercising control over the ad purchaser; and
  • the total amount paid for the ad.

In addition, the platform had to maintain the following information for a year after the election and make it available to the State authorities upon request:

  • the candidate or ballot issue to which the qualifying paid digital communication relates and whether the qualifying paid digital communication supports or opposes that candidate or ballot issue;
  • the dates and times that the qualifying paid digital communication was first disseminated and last disseminated;
  • a digital copy of the content of the qualifying paid digital communication;
  • an approximate description of the geographic locations where the qualifying paid digital communication was disseminated;
  • an approximate description of the audience that received or was targeted to receive the qualifying paid digital communication; and
  • the total number of impressions generated by the qualifying paid digital communication

The appeals court found that this “compelled speech” forced these platforms to “speak” when they otherwise might not want to – the “speaking” being the mandatory publication of information on their website.  The court also pointed to the potential of these rules to chill political speech, by compelling companies to reveal information about those who might otherwise not want to disclose that they are taking a position on a controversial issue or election.  The court found that anonymity in political speech was part of a long tradition in the US, and it could subject those buying the political ads to harassment.  Also, the added burden of collecting this information could cause platforms to reject political ads in favor of advertising where no such burden was imposed. 
Continue Reading Court of Appeals Finds Maryland Law Imposing Political Disclosure Obligations on Online Platforms to be Unconstitutional – Finding Different Treatment of Broadcasters is Justified

It seems like every other week, there is a story about an online media giant making changes in their rules that govern political advertising on their platform – and being either praised or condemned for doing so. We recently wrote about the controversy over Facebook deciding to not fact-check candidate ads, and how Congress itself requires by statute that broadcast stations take that same position. Broadcast stations are not allowed to censor ads from legally qualified candidates so, except in very limited circumstances where the ads may be criminal in nature (and not where they might just give rise to civil claims, like in the case of defamation or copyright infringement), broadcasters cannot reject ads based on their content. The right of a person being defamed in an ad for redress of any civil claim they may have is against the candidate who sponsored the ad, not against the broadcaster. Last week brought the news that Twitter has decided to ban political ads from its platform. Broadcasters, on the other hand, have no ability to ban ads for Federal candidates, as Congress has legislated a right of access to the airwaves where broadcasters cannot refuse to run political advertising from any Federal candidate.

That right of reasonable access, written into Section 312 of the Communications Act, requires that broadcasters give Federal candidates access to all classes of advertising time sold on a broadcast station, and that access be provided in all parts of the broadcast day. See our post here for more information about that reasonable access requirement, and our post here on the limited exception accorded for special events with limited advertising inventory (like the Super Bowl), where the provision of ads to one side might be problematic as there would be no opportunity for an opposing candidate to find an equivalent opportunity to advertise, and because of the potential disruption to commercial advertising on these stations given the limited availability of advertising breaks in such programs.
Continue Reading Twitter Bans Political Ads – Doing What Broadcasters are Forbidden to Do

The FCC announced on Friday that it will be hosting a symposium on the state of the broadcast industry on November 21.  On that day, there will be a panel in the morning on the state of the radio industry and one in the afternoon on television.  The Public Notice released Friday lists a diverse group of panelists, but says little beyond the fact that the forum will be occurring.  What could be behind the Commission’s decision to host this session?

The FCC is working on its Quadrennial Review of its ownership rules (see our articles here and here).  There were many who expected that review to be completed either late this year or early next, with relaxation of the radio ownership rules thought to be one of the possible outcomes.  Of course, quick action may have been derailed by the decision of the Third Circuit Court of the Appeals to vacate and remand the Commission’s 2017 ownership order.  The court’s decision unwinds the FCC’s 2017 order which included abolition of the broadcast newspaper cross-ownership rule and the rule that limited one owner from owning two TV stations in the same market unless there were 8 independent television operators in that market – see our article here on the 2017 decision and our article here on the Third Circuit’s decision.  The basis of the Third Circuit decision was that the FCC did not have sufficient information to assess the impact of its rule changes on minority ownership and other potential new entrants into broadcast ownership.  If the FCC did not have enough information to justify the 2017 decisions, many believe any further changes in its rules are on hold until the FCC can either satisfy the court’s desire for more information on minority ownership or until there is a successful appeal of that decision.  Even though FCC changes to its ownership rules may be in abeyance, the November 21 forum can shed light on the current state of the industry and why changes in ownership rules may be justified.
Continue Reading FCC To Hold Symposium on Radio and TV Industry – What Does it Mean for Broadcast Regulation?

In recent weeks, Facebook has been criticized for adopting a policy of not censoring advertising and other content posted on its platforms by political candidates.  While Facebook apparently will review content whose veracity is challenged when posted by anyone else, it made an exception for posts by political candidates – and has received much heat from many of those candidates, including some who are currently in Congress.  In some cases, these criticisms have suggested that broadcasters have taken a different position and made content-based decisions on candidate ads.  In fact, Congress itself long ago imposed in Section 315(a) of the Communications Act a “no censorship” requirement on broadcasters for ads by federal, state, and local candidates.  Once a candidate is legally qualified and once a station decides to accept advertising for a political race, it cannot reject candidate ads based on their content.  And for Federal candidates, broadcasters must accept those ads once a political campaign has started, under the reasonable access rules that apply only to federal candidates.

In fact, as we wrote here, broadcasters are immune from any legal claims that may arise from the content of over-the-air candidate ads, based on Supreme Court decisions. Since broadcasters cannot censor ads placed by candidates, the Court has ruled, broadcasters cannot be held responsible for the content of those ads.  If a candidate’s ad is defamatory, or if it infringes on someone’s copyright, the aggrieved party has a remedy against the candidate who sponsored the ad, but that party has no remedy against the broadcaster.  (In contrast, when a broadcaster receives an ad from a non-candidate group that is claimed to be false, it can reject the ad based on its content, so it has potential liability if it does not pull the ad once it is aware of its falsity – see our article here for more information about what to do when confronted with issues about the truth of a third-party ad).  This immunity from liability for statements made in candidate ads absolves the broadcaster from having to referee the truth or falsity of political ads which, as is evident in today’s politically fragmented world, may well be perceived differently by different people.  So, even though Facebook is taking the same position in not censoring candidate ads as Congress has required broadcasters to take, should it be held to a different standard? 
Continue Reading Facebook Criticized for Not Censoring Candidate Ads – Even Though Congress Requires No Censorship from Broadcasters

On the anniversary of the events of September 11, 2001, we should all be thankful for the work of the nation’s first responders. Broadcasters and other members of the electronic communications industries play a part in the response to any emergency – including through their participation in the Emergency Alert System (EAS). In recent weeks, the FCC has been aggressively prosecuting parties who it has found to have transmitted false or misleading EAS alerts. This was exhibited this week through the Notice of Apparent Liability issued to CBS for an altered and shortened version of the EAS tones used in the background of a “Young Sheldon” episode, leading to a $272,000 proposed fine. Consent decrees were announced two weeks ago with broadcasters and cable programmers for similar violations (see FCC notices here, here, here and here), with payments to the US Treasury reaching $395,000. These follow past cases that we have written about here, here, here, here, and here, where fines have exceeded $1 million. The CBS case raised many interesting issues that have received comment elsewhere in recent days, including the First Amendment implications of restrictions on the use of EAS tones in programming, and whether an altered tone in the background of an entertainment program, where audiences would seemingly realize there was no actual emergency, should really be the subject of an enforcement action. But the question that has not received much attention is one raised by the FCC’s Enforcement Advisory released last month addressing the improper use of EAS alert tones and the Wireless Emergency Alert tones used by wireless carriers (known as WEA alerts), and simulations of those tones. That advisory raises questions of just how far the FCC’s jurisdiction in this area goes – could it reach beyond the broadcasters and cable programmers to which it has already been applied and extend to online programming services?

This question arises because the FCC’s Enforcement Advisory addresses not only EAS tones used by broadcasters and cable systems, but also the WEA alert tones voluntarily deployed by most wireless providers. The advisory makes clear that the use of either EAS or WEA tones without a real emergency is a violation of the FCC rules. The Advisory states:

The use of simulated or actual EAS codes or the EAS or WEA Attention Signals (which are composed of two tones transmitted simultaneously), for nonauthorized purposes—such as commercial or entertainment purposes—can confuse people or lead to “alert fatigue,” whereby the public becomes desensitized to the alerts, leading people to ignore potentially life-saving warnings and information.

The FCC goes on to state:

the use of the WEA common audio attention signal, or a recording or simulation thereof, in any circumstance other than in an actual National, State or Local Area emergency, authorized test, or except as designed and used for PSAs by federal, state, local, tribal and territorial entities, is strictly prohibited.
Continue Reading How Far Does the FCC Authority Over False EAS Alerts Go? Could Online Programming be Subject to its Reach?

Recently, the Radio Music License Committee sent out a memo to broadcasters about a July 8, 2019 SoundExchange payment deadline for pre-1972 sound recordings.  As with everything in copyright law, the issues surrounding pre-1972 sound recordings are complicated, and the RMLC notice, while seemingly straightforward, still resulted in our receiving lots of questions.  These questions may have been compounded because of notices sent to broadcasters back in April about another filing deadline concerning these recordings which caused much consternation for what was, for most broadcasters, a matter of little concern.  For most broadcasters, neither of these dates are of particular concern unless the broadcaster has been identifying pre-1972 sound recordings and not paying SoundExchange royalties when those songs are streamed, and we understand that most broadcasters have in fact been paying SoundExchange for these recordings.  But let’s try to explain what is going on in a little more detail.

First, let’s look at the basics.  Sound recordings (the recording of a particular band or singer performing a song) were originally not covered by federal copyright law.  The law provided protections for “musical works” (i.e. the musical composition, the words and musical notes of the song), but the mere recording of that work was initially not seen as a creative work.  It was thought of more as a mechanical rendering of the real creative work – the underlying song.  So when recordings came to have real value in the first half of the last century, recording artists had to rely on state laws to prevent other people from making and distributing copies of their recordings. Laws against what we would refer to as bootlegging or pirating of recordings were passed in most states, and lawsuits against bootleggers would be brought under these state laws.  It was not until 1972 that Congress, through an amendment to the Copyright Act, recognized that the recordings were themselves creative works entitled to copyright protection.  But that amendment did not fully make all pre-existing recordings subject to the Copyright Act, instead leaving most sound recordings first recorded in the United States prior to the adoption of the amendment to the Act in February 1972 subject to state laws until 2067.
Continue Reading Pre-1972 Sound Recordings and the July 8 SoundExchange Filing Deadline

Looking for a brief explanation of the online public inspection file and Quarterly Issues Programs List, and how they will be viewed in connection with the upcoming license renewal cycle – including the potential fines for violations of the rules? The Indiana Broadcasters has just released this video of me discussing those issues available

In the last few weeks, the press has been buzzing with speculation that the Department of Justice is moving toward suggesting changes in the antitrust consent decrees that govern the operations of ASCAP and BMI.  Those consent decrees, which have been in place since the 1940s, among other things require that these Performing Rights Organizations treat all songwriters alike in distributions based on how often their songs are played, and that they treat all services alike with users that provide the same kind of service all paying the same rate structure.  Rates are also reviewed by a court with oversight over the decrees when the PROs and music services cannot come to a voluntary agreement to arrive at reasonable rates.  The decrees have also been read to mean that songwriters, once part of the ASCAP or BMI collective, cannot withdraw with respect to certain services and negotiate with those services themselves while still remaining part of the collective with respect to other music users (see, e.g., our articles here and here about the desires of certain publishing companies to withdraw from these PROs to negotiate directly with certain digital services while still remaining in these PROs for licensing broadcasting and retail music users).

With this talk of reform of the consent decrees, Congress, particularly the Senate Judiciary Committee under the leadership of Senator Lindsey Graham, has reportedly stepped in, telling DOJ not to move to change the consent decrees without giving Congress the chance to intervene and devise a replacement system.  In fact, under the recently passed Music Modernization Act, notice to Congress is required before the DOJ acts.  Already, both the PROs and user’s groups are staking out sides.  What are they asking for?
Continue Reading ASCAP and BMI Consent Decrees Under Review – How Performing Rights Organizations, Antitrust Policy and Statutory Licenses Could Create a Controversy

When is your website or app covered by the Children’s Online Privacy Protection Act (“COPPA”) and the FTC’s COPPA Rule?  Although there are gray areas under COPPA, one clear way to fall under this law is to know that you’re collecting information from children under the age of 13 online.  That’s part of what landed Musical.ly, now known as TikTok, in trouble with the FTC – including a record-setting COPPA fine of $5.7 million.  COPPA isn’t limited to the kinds of video social network apps that Musical.ly provides; broadcasters’ websites and apps may end up falling under COPPA.

According to the FTC’s complaint, Musical.ly knew that it was collecting information from children under 13 (COPPA doesn’t apply to anyone else) for several reasons.  For instance, press articles described the popularity of Musical.ly among under-13 users, the company received hundreds of complaints from parents trying to close their kids’ accounts, and the company itself provided guidance to parents regarding their children’s usage of the app. 
Continue Reading FTC Obtains Record $5.7 Million Fine for Children’s Privacy Protection Act Violation

The Notice of Proposed Rulemaking in the next Quadrennial Review of the FCC’s ownership rules was adopted in December and was published today in the Federal Register, starting the 60 day period for public comments. Comments on the NPRM will be due on April 29 with reply comments due on May 29. The FCC is looking at numerous issues, including one issue, the rules setting out the limits on the number of radio stations that one company can own in a market, that has not been reviewed in depth in recent Quadrennial Reviews. On the TV side, the FCC is again looking at local TV ownership (specifically combinations of Top 4 stations in a market and shared services agreements) and also at the dual network rule restricting common ownership of two of the Top 4 TV networks. In addition, the FCC is reviewing additional ideas on how to increase diversity in broadcast ownership. Today, let’s look at the FCC’s questions on the local radio ownership rules.

The review of the radio ownership rules may well be the most fundamental issue facing the Commission in this proceeding, as no real changes have been made in those rules since they were adopted as part of the 1996 Telecommunications Act. As we wrote here, the marketplace has certainly changed since 1996 – which was at least a decade before Google and Facebook became the local advertising giants that they now are; and before Pandora, Spotify, YouTube and many other web services offered by tech giants became competitors for the audience for music entertainment. And spoken word entertainment competition was also virtually non-existent – “audiobooks” were a niche product and the concept of a “podcast” would have been totally foreign when the current rules were written. So what are some of the questions about the radio ownership rules that are being asked by the FCC?
Continue Reading Countdown to Comments on Next Quadrennial Review of Media Ownership Begins – Part I, Local Radio Ownership