In the last few days, the trade press has been full of stories about a settlement of a lawsuit brought against a large broadcaster for alleged violations of the Telephone Consumer Protection Act (“TCPA”). Given that the settlement was for $8.5 million, it has commanded lots of attention. While much of this attention seems to suggest that this is a new obligation, we wrote about this issue last year, warning broadcasters of the potential for big liability if they did not pay attention to the requirements of the rules. The rules prohibit “telemarketing” calls or texts using an “autodialer” unless the recipient has explicitly consented to receive such messages.  In the recent decision, the broadcaster allegedly responded to texts sent to enter a contest with reply texts containing advertising messages unrelated to the contest. 

While TCPA rules are written by the FCC, this is one of those few rules where a violation can not only bring penalties from the FCC, but also there is a “private right of action” by people who receive unwanted calls or texts – i.e. they can sue a broadcaster who contacts them in a manner that violates the act.   And there are law firms that specialize in this litigation, even putting together groups of plaintiffs to bring actions against alleged violators – seeking damages including statutory damages (meaning that no real injury needs to be proven).  So just what does the TCPA cover? Here is what Josh Bercu, an attorney in my firm, wrote last August:

The TCPA is a law that restricts businesses and organizations from making calls and texts to consumers’ residential and wireless phones without having first received very specific permission from the recipient. Sending texts to broadcast station viewers or listeners who are contained in a station’s loyal listener or loyal viewer clubs can lead to liability if the proper releases are not obtained, and collecting text addresses from contest participants and adding them to station databases can similarly be problematic.   Because violations of the TCPA can result in civil liability of $500 to $1500 per call or text plus FCC fines, and as there have been a number of law firms around the country that have been active in filing class action suits against businesses to collect those potentially very high per-call damages, broadcasters need to ensure that their practices comply with the TCPA and the FCC’s rules which implement the Act.  While the recent Order provided some specific relief in limited circumstances to businesses, it leaves many well-intentioned companies, including broadcasters, at risk as they try to contact their viewers and listeners. Below we address some commonly asked questions about how the TCPA may apply to broadcasters. Continue Reading Using Text Messages in Promotions and Contests? – $8,500,000 Settlement Provides Reminder to Make Sure You are Aware of TCPA Obligations

The online public inspection file for radio stations becomes a reality for most Top 50 market stations on June 24. Yesterday, I conducted a webinar for members of 19 state broadcast associations, discussing the process for the transition to the online public file. I also outlined obligations for maintaining the public file and the required contents of the file – what documents need to be included as well as the retention period for those documents. Slides from that presentation are available here.

Just as the presentation was wrapping up, the FCC issued a Public Notice announcing its own workshop on the new online public file. That presentation on June 13 at 1 pm ET is geared to all of the media entities that are required (or will be required by June 24) to maintain an online public inspection file – radio, TV, satellite radio and TV, and cable operators. The presentation seems to be a “how to” demonstration of the workings of the new public file system. That system is different from the one that TV stations have been using for the last several years – being cloud-based and supposedly with more functionality than the current system. So users, old and new, should tune in to the FCC workshop to get a review of the workings of the new system. Online access to the seminar is available here. Also, stations can begin to experiment with the new system with a simulated file for practicing – available here. Continue Reading The Online Public Inspection File– A Presentation on the Requirements for Radio, and an FCC Workshop for All Users on Procedures for Using the New System

The question of whether state laws about pre-1972 sound recordings could give copyright holders a claim against broadcasters for the over-the-air public performance of these recordings was answered in a novel manner in a decision rendered by a US District Court in California. The evidence before the Court showed that CBS, the broadcaster being sued, had played digitally remastered versions of the pre-1972 songs, not the original analog pre-1972 recordings. The Court, based on evidence provided by the sound engineers who remastered the digital versions of the songs, found that there was enough originality in the remastering process for the digital versions to be copyrightable as “derivative works.” A derivative work is a separate work, based on the original, which can itself be copyrighted if there is some creativity in the new work. As the remastered derivative work was created after 1972, the Court decided that it was covered under Federal law. As Federal law provides no royalty for the public performance of a sound recording by an over-the-air broadcaster, the Court granted CBS summary judgement in the suit brought against it, dismissing the claims of the copyright holders (the text of the decision is embedded in this Hollywood Reporter article about the case).

The question of whether digitized versions of old recordings are sufficiently creative to merit their own copyrights (whether they are “original works of authorship”) has been debated in copyright circles for some time. Here, the Court looked at a summary of the law that had been prepared in a Circular distributed by the Copyright Office, which listed certain criteria that could be applied in determining whether a re-recorded work had sufficient creativity to merit a copyright. The Court also looked at specific evidence offered by recording engineers that showed how they used independent creative judgment in deciding to enhance certain elements of the recording in the digital version and to suppress others. The testimony showed that the digital version was the result of more than simply hooking the analog source material to a digital recorder and distributing the result. Human intervention in deciding how to materially change the original work to produce a new digital work was found by the Court – deciding that this was a classic version of a derivative work, authorized by the Copyright holders themselves when they commissioned the digital versions of the recordings. Thus, these works were entitled to their own copyright – a copyright that arose when the work was created after 1972.

We wrote about this issue in our article here, an article that primarily dealt with pending appeals of the question of whether there really is a state law public performance right in pre-1972 sound recordings. We wrote there about the fact that Sirius XM and some webcasters have not raised the CBS defense, as they have argued that no such royalties are due on pre-1972 sound recordings and have not been making such payments to SoundExchange (the Court in the CBS case said that CBS was apparently making such payments). Of course, the issue was not raised in those cases as to whether these companies were playing analog versions of the old recordings, or new digitally remastered works that may be entitled, if the current decision is upheld, to new copyrights (in fact, as we wrote here, the Copyright Royalty Board itself has approved of Sirius XM not making payments for pre-1972 recordings, without addressing what constituted such a recording). What implications does this decision have on other cases where this issue has been raised? Continue Reading US District Court Finds Digitally Remastered Pre-1972 Sound Recordings Are “Derivative Works” Covered By Federal Law – Dismisses Suit against Broadcaster Seeking Over-the-Air Performance Royalties

FCC regulatory fees come around each year, and it seems like they always go up.  This year is no different, as the FCC has asked for comments on its proposed fees to be paid later this year (probably in September), and the proposed fees go up significantly for broadcasters.  The fees are meant to recoup the costs of the FCC’s regulation of the industries that it oversees.  Minimal changes are proposed due to the FCC’s refining of the roles that are played by some of its employees in regulating different types of communications services.  But this year, as the FCC’s lease for its headquarters building is expiring, its operational costs have to include not just the normal expenses of the FCC’s operations, but also the added expense of the probable relocation of the agency.  This one-time expense results in a major increase in the fees being charged.  While the increased fees are a one-time expense, there are certain to be complaints from broadcasters when they see the size of the increase in their fees to be paid this year.

Each year, the FCC goes through a familiar process – asking for comments on an essentially expedited basis so that the fees can be adopted and collected before the end of the government’s fiscal year – October 1.  This year is no different, and the week before last, the FCC asked for comments on the fees to be collected this year – with comments on the proposals due on June 20 and replies due on July 5.  Let’s look at some of the proposed changes. Continue Reading FCC Regulatory Fees for Broadcasters Proposed to Increase Significantly to Cover Cost of FCC Headquarters Move

While summer has just about arrived, FCC regulatory dates do not depart to the beach and leave the world behind.  Instead, there are a host of filing deadlines this month.  EEO Public Inspection file reports must, by June 1, be placed in the public inspection files of stations that are part of employment units with 5 or more full-time employees if the stations are located in the following states: Arizona, Idaho, Maryland, Michigan, Nevada, New Mexico, Ohio, Utah, Virginia, West Virginia, Wyoming, and the District of Columbia.  Radio stations in Michigan and Ohio that are part of employment units with 11 or more full-time employees need to also file an FCC Mid-Term EEO Report on FCC Form 397 (see our article on the Form 397 here).  TV stations with 5 or more employees also need to file that report if they are located in Maryland, Virginia, West Virginia or the District of Columbia.

There are regular dates, too, for noncommercial stations in certain states when licensees must file their Biennial Ownership Reports on FCC Form 323E.  While these reports will eventually be filed on December 1 of odd-numbered years, at the same time as Biennial Ownership Reports of commercial stations, at this point the new rules have not yet gone into effect (see our articles here and here).  Thus, by June 1, the licensees of noncommercial radio stations in Michigan and Ohio and noncommercial TV stations in Arizona, Idaho, Maryland, Nevada, New Mexico, Utah, Virginia, West Virginia, Wyoming, and the District of Columbia must file their Biennial Ownership Reports. Continue Reading June Regulatory Dates for Broadcasters – EEO and Noncommercial Ownership Reports, Incentive Auction, Radio Online Public File, and Comments on EAS and Regulatory Fees

At its open meeting earlier this week, the FCC adopted a Notice of Proposed Rulemaking proposing changes to the public file rules for both broadcasters and cable systems. For commercial broadcasters, the FCC proposed to eliminate the requirement that they include in their public file copies of letters and emails to the station concerning station operations. For cable systems, the FCC proposed to eliminate the obligation to include in their file documents disclosing the location of their headend. What do these proposals mean for broadcasters?

Most of the broadcaster focus has been on the proposal to delete the obligation that commercial broadcasters keep a correspondence folder in their public inspection file for letters and emails from the public commenting on the operation of the station (the requirement has never applied to noncommercial broadcasters). Those files are supposed to contain, in a physical file at their main studio, all of the correspondence that stations receive from viewers or listeners (allowing broadcasters to omit correspondence that listeners asked to be kept private, and correspondence that contains offensive material). For TV stations that have already converted to an online public file for all of their other public file documents, and for radio stations who will soon be doing so (see our posts here and here on the upcoming obligation of radio to convert to an online public file), these letters will be the only remnant of the public file that must still be maintained at the main studio. The FCC tentatively concluded that the obligation to keep these letters and emails was no longer necessary. Continue Reading FCC Proposes to Eliminate Public File Obligations – No More Letters from the Public for Broadcasters, No Cable Headend Information for Cable Systems?

The Third Circuit Court of Appeals yesterday issued an opinion faulting the FCC for not completing any required review of its broadcast ownership rules since the 2006 review was completed in 2007. These reviews of its ownership rules, now done as “Quadrennial Reviews” every four years, but previously required to be done biennially, have been the subject of much judicial review and delay in the past 9 years. Because of the delays in finalizing a review and addressing issues previously raised by the Court, yesterday’s decision ordered the FCC to meet with certain parties who brought the appeal to finalize a timetable for FCC review of the rules designed to promote minority ownership of broadcast stations. At the same time, the Court threw out the FCC’s 2014 decision determining that television Joint Sales Agreements were attributable interests (see our article here), which had essentially banned these agreements in most markets as the attribution of an interest in one station to the owner of another station in the same market would constitute a combination of stations not permitted under the local TV duopoly rules. The discussion in the decision also raised questions as to whether the FCC could justify the continued existence of the broadcast-newspaper cross-ownership rules given the radically changed state of the newspaper industry since these rules were adopted over 40 years ago.

While much has been made of the decision overturning the attribution of television Joint Sales Agreements, that part of the decision was actually a narrow one, and one which leaves the FCC in a position where it could reinstitute the attribution requirement when it completes its current review of the ownership rules. The Court looked at the 2014 decision determining that JSAs should be attributable, and concentrated on the dissenting opinion of Commissioner Pai. The Commissioner argued that the FCC’s decision making the interests attributable ignored record evidence that such combinations were in the public interest. The dissenting opinion said that some combinations were necessary, particularly in smaller television markets, to permit the profitable operations of weaker stations in these markets, and that the agreements otherwise contributed to the public interest by allowing stations that could not afford news and other beneficial programming to air such programming. The Commission dismissed those arguments, contending that they were really addressing questions as to whether more small market TV duopolies should be permitted. But, as the FCC did not address whether small market TV duopolies might be in the public interest, but instead deferred that decision until the next Quadrennial Review, the Court found (as Commissioner Pai had argued) that the FCC decision could not be justified. The FCC could not ban JSAs as not being in the public interest until they considered the arguments as to whether small market duopolies, which could permit many of the JSAs to continue even if attributable, were in the public interest. Continue Reading Appeals Court Tells FCC to Finalize Multiple Ownership Review, Throws Out TV JSA Attribution, and Questions Newspaper-Broadcast Cross-Ownership Ban

In an FCC decision fining a TV station $10,000 for failing to include 15 Quarterly Issues Programs lists in its public inspection file, the FCC refused to reduce the proposed liability based on an intervening “long-form” transfer of control followed by a short-form assignment of license of the station. Thus, even though the station was no longer controlled by the same individuals who controlled the station at the time of the violation, and even though the licensee company was different, the fine still applied.

The Media Bureau decision looked at precedent that has held that a transfer of control of a station, even a “long-form” application on FCC Form 315 that is subject to public notice and a 30 day waiting period during which the public can comment on the change in control of the licensee, does not excuse the licensee for violations of the FCC’s rules that occurred prior to the transfer. We wrote about a similar holding in another case last year. The FCC’s view is that, when you are buying the stock of a company, you acquire not only the assets of the company but also its obligations, including any potential FCC violations. This is different from an assignment of license filed on a Form 314 (also a “long-form” application subject to a 30-day public comment period) – where a buyer just buys the assets through a new company and does not assume the liabilities – a difference that the FCC has recognized in these cases. In the decision reached today, the licensee attempted to exploit that different treatment – but the FCC rejected the distinction. Continue Reading Fine for Missing Quarterly Issues Programs List Not Excused by Intervening Transfer of Control of TV Station – Buy Assets Not Stock to Avoid Assuming Prior Owner’s FCC Liabilities

Last week, we posted a reminder about the obligations for stations to provide equal opportunities for competing candidates to buy time on broadcast stations, and also talked about how the equal time provisions do not apply to bona fide news and news interview programs. Almost immediately, I received several questions about on-air employees who decide to run for political office, and how they are treated for purposes of the equal opportunities rule. Having an on-air employee who runs for political office – whether it is a federal, state or local office – does give rise for equal opportunities for competing candidates whenever that employee’s recognizable voice or picture appears on the air, even if the personality never mentions his or her candidacy on the air, and even if they appear in what is otherwise an exempt program (e.g. a newscaster who runs for office triggers equal time when he delivers the news even though a candidate’s appearance as a subject of that news program would be exempt). Stations need to take precautions to avoid the potential for owing significant amounts of free time to competing candidates, where those candidates can present any political message – if they request it within 7 days of the personality’s appearance on the air.

We have written about this issue many times before, including coverage of when well-known local or national personalities have contemplated runs for office – see our stories here, here and here. In 2010, we wrote an article that provided a discussion of this issue, which remains valid today. An edited version of that article is below. Continue Reading Equal Opportunities – What to Do With the On-Air Employee who Runs for Political Office

The FCC today issued a Public Notice that the obligation will begin on June 24 to start uploading documents to the online public file for radio stations in the Top 50 markets .   For Top 50 market commercial radio stations that are part of employment units with 5 or more full-time employees, the June 24 date will mark the start of their obligation to upload materials to the online public file.  New public file documents (including political file documents) created on or after that date are to be placed in the online public file.  These stations will have 6 months from the effective date (until December 24, 2016) to upload to the online public file existing documents that are already in their paper public file.    This would include documents like EEO Public Inspection File Reports and Quarterly Issues Programs Lists. Pre-effective date political file documents need not be uploaded. Letters from the public also do not need to be uploaded (see our article here about the FCC’s proposal to entirely do away with the requirement that letters be kept). We wrote more extensively about the obligations for the radio online public inspection file here.

TV, too, needs to pay attention to this notice.  The Public Notice announces that the online public file will be moving to a new database.  Effective on June 24, TV licensees will need to use this new database too – what the FCC calls the “OPIF” (for expanded online public inspection file) as opposed to the old “BPIF” (“broadcast public inspection file”).  The FCC suggests that the new OPIF database will allow for easier uploads – including the ability to upload a single document into multiple stations’ files at the same time.  It will also have a more user-friendly interface, and will work better with other online systems like Dropbox and Box.  This database moves these files off the FCC server and onto a cloud-based storage system.  Stations can already try out the new system here.  Continue Reading FCC Announces June 24 Effective Date for Radio Online Public Inspection File and New System for TV Stations Online File, Plus a Reminder to Upload JSAs