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To help broadcasters sort out the confusing rules about political advertising, we have updated our Political Broadcasting Guide for Broadcasters (note that the URL for the updated version has not changed from prior versions, so your bookmarks should continue to work). The revised guide is much the same as the one that we published two years ago, formatted as Questions and Answers to cover many of the issues that come up for broadcasters in a political season. This guide is only that – a guide to the issues and not a definitive answer to any of the very fact-dependent legal issues that arise in election season. But we hope that this guide at least provides a starting point for the analysis of issues, so that station employees have a background to discuss these matters with ad buyers and their own attorneys.

In looking at the Guide that we prepared two years ago, really not much has changed. But there are some specific updates that should be noted. For instance, sponsorship identification seems to be a hot issue in the last two years. We wrote here about the $540,000 fine paid as part of a consent decree when a Cumulus radio station did not fully identify the sponsor of advertising on a controversial issue of public importance. We have also written here and here about issues that are currently pending at the FCC about the proper sponsorship identification tag that belongs on an ad paid for by a PAC that is funded by one individual. This is an issue to which stations should be alert. The online public file for radio is mentioned, as this will affect how radio broadcasters maintain their political file starting at some point later this year (see our article here about the online public file requirements for radio broadcasters). Also, we note the adoption by many stations of programmatic selling, and suggest that stations need to carefully review how these sales platforms may impact lowest unit rate issues. We have made some other clarifications and revisions as well.
Continue Reading Updated Political Broadcasting Guide – Questions and Answers about Broadcasters’ Obligations During this Election Season

The only significant legal issues that were potentially standing in the way of the broadcast incentive auction are slowly being removed. So far this week, the US Court of Appeals in Washington, DC has denied two requests for stays of the commencement of the reverse auction, scheduled to begin on March 29 with the submission of commitments to accept the FCC’s payout offers by stations interested in surrendering their channels to the FCC or moving from UHF to VHF channels. The Court denied one stay request outright, but it did note that another applicant, Latina Broadcasters, had made a showing sufficient for the Court to order some relief for that applicant. The Court ordered that the licensee be allowed to participate in the incentive auction on a provisional basis – presumably meaning that they can bid but, if their appeal of being thrown out of the auction is denied, they would not get the benefit of any payments that would otherwise have gone their way from any surrender of their license in the auction.  (See our article here about previous actions in this case)

The FCC has now issued a statement that the inclusion of Latina in the auction will not delay the March 29 deadline for auction participants to make their binding commitments about auction participation. A letter to the Court, referenced in the FCC’s statement, contains a cryptic statement that “a short delay would result from Latina’s inclusion in the auction,” perhaps indicating that other aspects of the auction may be delayed somewhat, but the FCC’s notice makes clear that the March 29 deadline will hold. This is of course subject to Court action on the final unresolved request for stay of the auction – a request by Videohouse, Inc., another LPTV licensee claiming that it should have been treated as a Class A station and included in the auction. The Court actions thus far let the FCC proceed with the auction, and the Commission has gone ahead with advancing the auction process itself, sending out letters to all auction applicants including the SecureID tokens necessary for applicants to participate in the auction itself.
Continue Reading Incentive Auction Moves Forward – Two Requests for Stay Denied and SecureID Tokens Distributed to Reverse Auction Participants

How far can a court go in ordering broadcasters to comply with the terms of a contract?  By trying to get a court to enforce a contract signed with a broadcaster, is the suing party infringing on a licensee’s control over its broadcast station license? These questions are addressed in a letter that the FCC released this week, sent to a federal district court in connection with a dispute between two big TV companies over the termination of a Joint Sales Agreement between TV stations in Georgia.  In the case, Media General is seeking to enforce a JSA against a TV station in Augusta that had been owned by Schurz Communications, which was recently acquired by Gray Television.  As a condition of the sale of Schurz to Gray, to obtain FCC approval, the parties agreed to terminate the Augusta JSA.  Media General sued, and on February 26 it obtained an injunction from a Georgia state court barring Gray from operating the station or selling the station’s spectrum in the upcoming incentive auction.  The FCC’s letter states that it believes that the courts cannot order the relief that Media General seeks without infringing on the licensee’s rights to control the station.

While there have been procedural developments in the underlying dispute dealing with the court that will hear the case, it is the substance of the FCC’s letter that is important.  The FCC’s conclusion was based on two findings.  First, it found that Media General could not enforce the JSA because its termination was a requirement of the FCC in connection with the sale of Schurz – so a court cannot order the station to violate the FCC’s own order.  But more fundamentally, the FCC determined that Media General’s efforts infringed on the obligation under Section 310 of the Communications Act that the licensee (now Gray) maintain control over its station unless the FCC has approved a transfer of that control.  In the FCC’s eyes, control includes control over the programming of the station – which would be infringed by the JSA.  It also includes control over the ultimate disposition of the station, which would be infringed by any order forbidding its participation in the incentive auction.  According to the FCC, an element of control of a station is being able to decide whether or not to sell it.  While the FCC acknowledged that Gray and/or Shurz might be liable to Media General for monetary damages and penalties for any breach of the contract provisions, Media General could not get a court to make the station comply with these alleged obligations.  This is not the first time that the FCC has made such a pronouncement.
Continue Reading FCC Says No to Court’s Enforcement of Contractual Rights that Limit Broadcast Licensee’s Control Rights – What Does this Mean for Broadcast Contracts? 

In the last day or two, some broadcast trade press reports may have given the impression that the FCC’s new online public file rules for radio may now be “effective,” suggesting that Top 50 market stations with 5 or more full-time employees need to start uploading their new political documents into the file (the first…

March appears to be another busy month on the FCC’s regulatory calendar.  While March is one of those months where there is not the usual assortment of EEO public file reports, quarterly issues programs lists or children’s television reports and noncommercial ownership report obligations (see our Broadcasters’ Regulatory Calendar here for some of these dates), it is a month with many other significant regulatory dates.  For instance, this month brings the scheduled start of the TV incentive auction as stations make binding commitments as top whether they will accept the FCC’s opening bids in the reverse auction.  It also brings deadlines for comments in a number of other proceedings that may affect broadcasters, including the FCC’s proceeding on AM radio revitalization and the Copyright Office’s look at the safe harbor for user-generated content.  In addition to comment periods, the lowest unit rate periods that apply during the 45 days before a Presidential primary are in effect in many states, plus March brings other deadlines including those for the first filing date for monthly SoundExchange Reports of Use under the new Internet radio royalty rates.  All make for a month where broadcasters need to watch regulatory developments very closely.

So let’s start with the incentive auction.  As we wrote just a few days ago, March 29 is the deadline for TV broadcasters to make a binding commitment to accept the FCC’s initial offer to buy their spectrum.  TV broadcasters who filed applications to participate in the Incentive Auction back in January were merely leaving the door open to their participation.  The March 29 deadline is the real legally binding commitment to surrender their spectrum at the price that the FCC has offered for their stations.  To make sure that broadcasters understand what they are doing, and how to make their commitments, as we wrote in our article, the FCC has set up an online tutorial on the system and will be holding a workshop about the process.  So if you have a TV station interested in taking advantage of the FCC’s offer to buy out your frequency, this is the month that the commitment needs to be made.
Continue Reading March Regulatory Dates for Broadcasters – Including Incentive Auction Commitments, New Webcasting Royalties, and Comments on AM Revitalization and Copyright Safe Harbor for User-Generated Content

The FCC yesterday released a Public Notice dealing with the upcoming March 29 commitment deadline for TV broadcasters who filed their applications back in January indicating a possible intent to participate in the incentive auction to surrender their TV channel so that the FCC can use it to repack the TV band to free spectrum to sell to wireless broadband users. In the Public Notice, the Commission made clear that station’s actual commitments to accept the FCC’s initial offers to give up their spectrum (either by abandoning their channel entirely by going out of business or sharing with a channel with another broadcaster, or by moving from a UHF to a VHF channel) will need to be filed between 10AM on March 28 and 6 PM (Eastern Time) on March 29. The January applications said that a broadcaster might be interested in giving up its current channel – filings made before the upcoming March 29 deadline make that commitment binding.

Yesterday’s notice announced that the FCC will be making available its “Initial Commitment Module” of the Incentive Auction software system at 10 AM on March 24 during a “preview period” for review by TV broadcasters. That is the piece of software on which the broadcaster makes its commitment to participate in the auction at the FCC’s initial offering price. Starting on Monday, February 29, the FCC will be making available an online tutorial to allow broadcasters to familiarize themselves with how the software will work. In addition, today the FCC announced that it will hold a workshop for broadcasters on March 11, starting at 10 AM Eastern Time, providing information on how to make these commitments.  These actions come while the FCC battles with some LPTV stations claiming that they should have been considered Class A TV stations and included in the auction – a legal battle that seems to be the last potential legal speedbump that could in any way derail the upcoming auction.
Continue Reading FCC Announces Previews for TV Broadcasters of Incentive Auction Initial Commitment Software; Denies Auction Stay Request from LPTV Applicant

The FCC today issued a Public Notice announcing its first EEO audit for 2016.  Letters to about 280 radio and television stations went out on February 24 asking for evidence of their compliance with the FCC’s EEO rules.  In today’s notice, the FCC released the form audit letter and list of stations that will be audited. Responses from the audited stations are due to be filed at the FCC by April 11. Licensees should carefully review this list of affected stations which was released with the Public Notice to see if any of their stations have been selected for the audit.

The Commission has pledged to audit 5% of all broadcast stations and cable systems each year to assure their compliance with the Commission’s EEO rules – including the requirements for wide dissemination of information about job openings and non-vacancy specific supplemental efforts to educate a station’s community about job opportunities in the media industry.  We recently summarized FCC EEO issues here, reminding broadcasters of the possibility of being audited.  We also wrote about the start of the obligations for the filing of FCC Form 397 EEO Mid-Term Reports – which started last year for radio groups with more than 11 full-time employees and will extend to TV licensees with 5 or more full-time employees in a few months, and are filed on the 4th anniversary of the filing deadline for the station’s license renewal – which will give the FCC another chance to review station EEO performance.  
Continue Reading FCC Announces First Round of 2016 EEO Audits for Radio and TV Stations

According to Politico, Ted Cruz’ campaign has demanded that TV stations pull certain PAC ads which he claims distort his voting record on immigration issues. This kind of claim from a political candidate about the unfairness of attack ads is common. Here, Cruz’ representatives apparently don’t threaten lawsuits against the stations for running the ads, but suggest that it is a violation of the stations’ FCC obligations to operate in the public interest to continue to run the ads. What is a station to do when such a claim is received?

We have written many times about this issue. Much depends on who is sponsoring the attack ad. If the ad is sponsored by the authorized campaign committee of another candidate, and features the voice or image of the sponsoring candidate, the station cannot do anything. As we wrote in detail here, a station cannot censor a candidate ad. Once it has agreed to sell time to a political candidate or his or her authorized campaign committee, the station must run the ad as delivered by the candidate without edit (with the very limited exception of being able to add a sponsorship identification if one is missing, or when running the ad would constitute a felony, e.g. running a spot that is legally obscene – not just indecent but obscene, meaning that it has no redeeming social significance). Because the station is required to run the ad as delivered by the candidate, the station has no liability for the content of the ad. So, if the candidate being attacked complains, the station can do nothing to edit, censor or pull the attacking candidate’s ad without violating the “no censorship” provisions of Section 315 of the Communications Act. The candidate being attacked has a remedy against the ad’s sponsor, not against the station. Third party ads, however, are different.
Continue Reading Ted Cruz Demands Takedown of PAC Ad Attacking His Voting Record – Issues that Broadcast Stations Need to Consider When Threatened by Candidate Wanting an Ad Pulled

The FCC’s new contest rules for broadcasters, allowing the disclosure of material terms on the Internet rather than reading them on the air, becomes effective upon the publication in the Federal Register of their approval by the Office of Management and Budget. OMB approval has been obtained, and the Federal Register publication is scheduled to…