Perhaps Sunday’s anniversary of Pearl Harbor made the FCC want to make this week one which concentrated on emergency communications issues, or perhaps it is just a coincidence.  But the FCC has been active in the past 7 days dealing with emergency communications related items for broadcasters.  On Wednesday, it issued a consent decree by which a broadcaster agreed to a $46,000 fine for the use of EAS tones in a commercial message. This decision follows on the heels of an investigatory letter sent to a satellite radio programmer about the apparent use of a simulated EAS tone in a commercial message when, of course, there was no real emergency.   On Monday, there were two fines for non-operational EAS receivers and EAS recordkeeping failures.  At the end of last week, comments were filed in an FCC proceeding looking at the retransmission of EAS alerts in non-emergency situations, such as when a tone is included in programming on a station, and what can be done to avoid those alerts being sent throughout the system.  Comments are also due by the end of the month on suggested best practices on security for the EAS system, in light of the many issues that have arisen with the hacking of EAS receivers.  Here is a quick look at each of these issues.

The two most recent decisions highlight the severity with which the FCC is treating the use of EAS tones – real or simulated – in non-emergency programming.  We have written about past cases where the FCC has issued very substantial fines for the use of such tones in nonemergency situations, here and here.  In the decision released on Wednesday, the licensee of a Michigan radio station admitted to having broadcast ads for a storm-chasing tour which contained the EAS warning tones.  The National Weather Service received complaints, and in turn filed a complaint with the FCC.  The Consent Decree does not provide much more information, but to indicate that the commercial containing the EAS tones was broadcast on only a single day.  A $46,000 fine for a one-day violation demonstrates the gravity with which the FCC views these violations.  And it is a sense of importance that attaches not just to licensees, but to programmers as well. Continue Reading A Week of Emergency Alert System Actions at the FCC – Fines Including One for $46,000 for EAS Tones in a Commercial, and Reviews of Best Practices for the System

We are often asked by television broadcasters if specialty programming – particularly local programming, like a local church’s broadcast of its Sunday morning church service – is covered by the FCC’s closed captioning obligations.  In a decision released on Friday, the FCC staff denied the request of a church for an exemption from the rules requiring the closed captioning of most television programming, and may have helped to make clear an answer to those questions.  This decision also helps to clear up a big question that has been hanging over such programs, for over 3 years since the FCC reversed dozens of prior waivers granted by its staff to nonprofit groups claiming that the captioning would be economically burdensome on their operations (including the waiver that had been granted to this church).  So what factors did the Commission review in denying this “economically burdensome” waiver request?

In 2011, the Commission stated that its staff had to consider the overall circumstances of each petitioner in evaluating economic waivers of the captioning rules, and could not simply rely on the fact that the petitioner was a nonprofit organization the FCC.  After revoking the waivers, the Commission asked the groups whose waivers were revoked to refile their requests with greater detail and support, not simply relying on the fact that the proponent was a nonprofit organization.  Factors to be considered in evaluating any claim that the captioning obligation was economically burdensome include: (1) the cost of the closed captions for the programming and attempts of the programmer to find cheaper sources of captioning; (2) the impact of the captioning obligation on the operation of the provider or program owner; (3) detailed information on the financial resources of the provider or program owner including income and expense statements for the prior two years; (4) attempts to get outside sponsors for the programming or support from the station on which the programming is to be broadcast; and (5) the type of operations of the provider or program owner.  In applying these factors in the decision released on Friday, the FCC staff concluded that the church had not justified a waiver because it had sufficient funds from which to pay the cost of the captioning.  Continue Reading FCC Denies Closed Captioning Waiver for Church Service – Clarifying New Standards on “Economically Burdensome” Exceptions to Captioning Requirements

On Friday, the FCC released an Order and Consent Decree by which Journal Broadcasting agreed to pay a fine of $115,000 and to enter into a compliance program to settle complaints that it had not adequately identified that a program aired on its Las Vegas TV station was sponsored by a local car dealership.  According to the FCC press release issued at the same time as the Order and Consent Decree, the program was labeled a “Special Report,” was hosted by a station employee who stated that she was “reporting on behalf of Channel 13,” was made to look like a news report (with the reporter interviewing various employees of the dealership about their liquidation sale), and was run immediately adjacent to the local news.  The Press Release stated that this action was important to insure “transparency” where consumers are not misled as to who is trying to persuade them about commercial product.  “[A] pseudo news report invites viewers to rely on their perception of the station’s independence and objectivity when, in fact, the message has been bought and paid for by an undisclosed third party,” stated the FCC in the press release.

While the licensee argued that the context of the program made clear that it was a sponsored ad, the Commission’s insistence on the payment of a fine here is evidence of much the same thinking as the decisions the FCC has reached in past cases where there was entertainment or informational programming presented without a sponsorship identification even where the programming was sponsored by a commercial entity.  Even simply providing a recorded program unduly promoting a commercial product has been found to be sufficient to trigger the FCC’s requirement that a sponsor be identified when a station receives valuable consideration for the airing of a program broadcast to the public (see our article here). Continue Reading TV Station Agrees to $115,000 FCC Fine for Not Identifying Sponsor of Program Promoting a Sale at Auto Dealership

Last week, the Senate approved a reauthorization of STELA, the new bill called STELAR (the “STELA Reauthorization Act of 2014”), adopting the version that had been approved by the House of Representatives earlier in the month.  In addition to simply giving satellite television companies (essentially DISH and DirecTV) the a five-year extension of their rights to rebroadcast the signals of over-the-air television stations without authorization from every copyright holder of the programming broadcast on those stations, STELAR made other changes to both the Communications and Copyright Acts that will have an impact on TV station operators once this bill is signed by the President.  The Presidential signing is expected before the end of the year.  [Update, 12/5/2014 – the President signed the Bill yesterday evening, so it is now law]

Some of the important provisions for TV stations contained in this bill include provisions that impact not only the relationship between TV stations and satellite TV companies, but also ones that have a broader impact on the relationship of TV stations with all MVPDs, including cable systems. There is also a provision actually providing more latitude for LPTV stations to negotiate carriage agreements.  Some of the specific provisions of this bill include:

JSA Extension:  STELAR will give TV stations currently operating with a Joint Sales Agreement with another station in their market which they cannot own under the current multiple ownership rules 6 more months to terminate such operations – until December 19, 2016 (after the next Presidential election).  See our discussion of the changes in JSA attribution here and here. Continue Reading Congress Passes STELAR – Renewing Authorization of Satellite Carriers Carriage of TV Stations – With Some Important Changes to JSA, Retransmission Consent and Market Modification Rules

In a Consent Decree released the day after Thanksgiving, the FCC agreed to accept a payment of a $35,000 penalty from a former television licensee for recording two telephone conversations for inclusion in a newscast, where the station called an outside party and recorded those conversations for inclusion in the newscast – before getting permission to do the recording.  The licensee also apparently did not fully respond to FCC inquiries about the facts of the case, leading to the $35,000 fine.  The FCC noted that the licensee had already sold the station, and was holding this money in a post-closing escrow account to be used to satisfy any fines that might arise from this conduct.

The decision is significant for several reasons.  First, it is couched in terms of privacy regulation, with a discussion of the importance of privacy regulation to the FCC in the opening paragraph (see the Public Notice that accompanied the release of the Consent Decree).  Recently, the FCC issued huge fines to independent telephone companies for not properly securing customer information – indicating a new emphasis on privacy regulation by the FCC.  Couching Friday’s consent decree in those terms indicates that privacy issues are now a high priority for the FCC.  As we have written before, privacy is a subject of interest to many other government agencies, and the recent interest of the FCC in this issue promises one more place where businesses can look for trouble should they respect the privacy of those with whom they interact, or should they not secure private information about their customers. Continue Reading $35,000 FCC Fine for TV Station that Tapes Telephone Conversations for News Broadcast Without Prior Permission

While we are in the Holiday season, the regulatory obligations faced by broadcasters don’t stop.  December brings a continuation of the TV renewal cycle, though we are nearing the end of that cycle.  Renewal applications for all TV, Class A and LPTV stations in the following states are due on December 1: Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont.  These stations need to file their first two post-filing license renewal announcements on the first and 16th of the month.  Stations that filed their license renewal applications in October also will be broadcasting their post-filing announcements on those same days (their last two announcements).  Those would be stations in the following states and territories: Alaska, Hawaii, Oregon, Washington, American Samoa, Guam, the Mariana Islands, and Saipan.  TV stations in the states that file license renewals on February 1 (those in New York and New Jersey) have to start running their pre-filing announcements on the December 1 (and run a second on December 16).

There are other routine filings due in December.  On December 1, Commercial and Noncommercial Full-Power and Class A Television Stations and AM and FM Radio Stations with employment units with 5 or more full-time employees in Alabama, Colorado, Connecticut, Georgia, Maine, Massachusetts, Minnesota, Montana, New Hampshire, North Dakota, Rhode Island, South Dakota, and Vermont all need to complete their EEO Public File Report and place that report in their public file (and on their websites, if they have one).  Noncommercial stations still have obligations to file Biennial Ownership Reports on every other anniversary of the filing of their license renewal applications.  That means that these reports are due on December 1 for Noncommercial Television Stations in Alabama, Connecticut, Georgia, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont; and on the same day for Noncommercial AM and FM Radio Stations in Colorado, Minnesota, Montana, North Dakota, and South Dakota. Continue Reading December Regulatory Dates for Broadcasters – Renewals, EEO Reports and Noncommercial Biennial Ownership Reports in Some States; TV Ancillary and Supplementary Revenue Reports; As Well as LPTV Rulemaking Comments and Many Other Expected Actions

The FCC yesterday issued an order declining to allow experimentation with the noncommercial underwriting rules that was requested by the licensee of noncommercial radio stations in the Phoenix area.  The licensee had asked the FCC for permission to conduct a three year experiment by relaxing the underwriting rules in certain ways to determine the effect such a relaxation would have on its ability to raise revenue, and the impact on the listening and support that the station currently enjoys.  In denying the station experimental authority to conduct the test, the FCC determined that it lacked the authority to authorize it, as the relaxation that the license was seeking would be prohibited not only by FCC rules, but also by statute, and the FCC cannot waive or grant an exception to a statutory provision (unless specifically permitted by the statute). 

The underwriting rules prohibit noncommercial stations from running advertising for commercial entities.  These rules have been relaxed somewhat over the last 30 years to allow for “enhanced underwriting” announcements, which allow noncommercial stations to identify their sponsors, and provide limited information about the products and services of those sponsors.  But the information cannot be promotional in nature.  Specifically, there are a number of limitations put on these announcements.  Some of these limitations include: (1) the announcements cannot contain “calls to action” – statements that suggest that listeners buy from the sponsor or patronize their place of business; (2) the announcements cannot have qualitative claims – so noncommercial stations cannot say that their sponsor was voted the “best car repair shop in the city by City Magazine,” even if that statement of fact is true; and (3) the announcement cannot provide price or other information relevant to a buying decision, e.g. where tickets are sold, interest rates, etc.  For more information about these rules, see some of our previous articles on this topic here, here, here and here, as well as a presentation on that issue that is discussed here.  What did this licensee seek to change in its experiment? Continue Reading FCC Declines to Allow Experimentation with Noncommercial Underwriting Rules

The FCC on Friday proposed to amend its rules governing contests conducted by broadcast stations by allowing the required disclosure of the material terms of the contest on the Internet, as an option for broadcasters in lieu of the current requirement that these disclosures be made by broadcasting them on-the-air a reasonable number of times.  But the proposed rule change is not as simple as one would think, with the FCC asking about whether a number of specific obligations should be attached to any online disclosures, even potentially adding the requirement that the full URL for the online disclosure be made every time a contest is mentioned on the air, not simply a reasonable number of times as required under the current rules.  So just what is the FCC proposing, and what is the big issue here?

The rule governing the conduct of broadcaster’s contests, Section 73.1216, covers contests conducted by broadcasters over-the-air.  It does not cover contests by broadcasters that are exclusively conducted online (though, as we wrote here, if the contest is announced on the air, even if primarily conducted online, all the required on-air disclosures apply).  It does not cover contests conducted by third-parties that are broadcast on the air (so contests conducted by an advertiser are not covered by this rule).  The current rule, in addition to requiring that the contest be conducted fairly and in accordance with the rules adopted for the contest, requires that the “material rules” be broadcast on the air on a regular basis so that listeners know what they might win, how to play the contest, and how the winner is selected.  It is this requirement, that the material rules be broadcast on the station, that has led to problems in the past, and thus prompted the proposed changes advanced on Friday. Continue Reading FCC Proposes To Amend Rules Governing Broadcast Contests – Suggests Allowing Disclosure of Material Terms of the Contest on the Internet

On Friday, the US District Court in the Southern District of NY found that there is a public performance right in pre-1972 sound recordings in that state, following two decisions from California finding a similar right under California law (though on different grounds).  Like the first decision in California (about which we wrote here), this decision was the result of a law suit by Flo and Eddie of the Turtles against Sirius XM, arguing that Sirius XM was infringing on their rights by playing old Turtles songs without paying the duo (who now own the Turtles’ copyrights) any compensation.  Unlike the California decision which looked to specific language in the California statute about ownership of pre-1972 sound recordings, the NY Court reaches a decision in some ways broader than the California decision, but potentially also in some ways narrower.  What does it mean for the many businesses that play such recordings?

There is no public performance right in sound recordings generally in the United States, with the limited exception of the public performance of such recordings in a digital medium.  Sound recordings had not been covered by Federal copyright law at all until 1972, when they were covered for purposes of protecting reproductions and distributions and other general rights, but Federal law specifically did not include this public performance right in sound recordings until the 1990s.  When sound recordings were added to Federal law in 1972, the regulation of pre-1972 sound recordings was specifically left to state regulation (where it had been prior to Federalization).  The limited digital performance right was adopted in a series of laws enacted in the late 1990s, as fears of digital piracy based on Internet and other digital transmissions grew.  So webcasters, satellite radio, digital cable radio and other digital users of sound recordings have paid a royalty for the performance of such recordings.  That royalty is set by the Copyright Royalty Board (see our article here about the most recent CRB proceeding to set rates), paid by noninteractive services to SoundExchange, and distributed by SoundExchange to copyright holders and artists. For interactive services (like Spotify or iTunes or Rhapsody), the performance rights have to be directly negotiated with the copyright holder, leading to disputes like the recent decision of Taylor Swift to pull her new album from Spotify (see our article here about the difference between interactive and noninteractive services).  As the 1990s adoption of the limited public performance right in sound recordings was a Federal act, most observers believed that there was no public performance right in sound recordings for pre-1972 recordings, as there never had been one prior to Federalization (despite many attempts by artists and labels to have one included in the law)(see our article here when the Flo and Eddie suit was first filed).  Continue Reading New York Court Finds Public Performance Right in Pre-1972 Sound Recordings – How Will This Affect Businesses that Use Music?

Even though the election is over, political broadcasting issues have not stopped.  Yesterday, the same groups (the Campaign Legal Center, Common Cause, and the Sunlight Foundation) that had previously objected to the sponsorship identification of issue ads funded by PACs with a limited donor base have struck again.  This time, they have filed a complaint with the FCC against a Chicago TV station claiming that it should have identified former New York City mayor Michael Bloomberg as the true sponsor of an ad run by a PAC. That PAC stated on its website that it had been formed by the former mayor and, from its FEC filings, it appears that it was 100% funded by Mr. Bloomberg.

The complaint differs from complaints filed earlier this year about similar ads in that, in this case, the station was given written notice by the Petitioner of the claim that the sponsorship identification should have included Mr. Bloomberg.  In previous cases, no such notice had been given to the station (the lack of such prior notice resulting in the FCC’s rejection of the initial set of complaints filed by this group, see our article here).  In addition, this is the first complaint where it appears that the PAC in question was 100% funded by a single individual.  See, for instance, our article here, where we asked in connection with previous complaints where the PACs in question were not 100% funded by a single individual how a station was supposed to know at what point the individual donor needed to be identified, and when there were a sufficient number of other donors that the identification of the groups as the true sponsor was proper.  Will these factual differences mandate a different result from the FCC? Continue Reading The Election is Over, But the Complaints Keep Coming – Should Michael Bloomberg Have Been Identified as the True Sponsor of an Ad Run by his PAC?