The FCC has just announced another of its regular EEO audits, though this time it’s just for cable and satellite television systems, which also have EEO obligations (see the FCC Public Notice and list of affected systems here). The FCC will audit 5% of all broadcasters and cable companies each year to assess their EEO compliance, so be prepared in case you are next. Broadcasters were last audited in June (radio stations only), so don’t be surprised to see another group of broadcasters required to submit their information for FCC scrutiny before the end of the year. 

This audit also serves to remind broadcasters of their obligation to annually prepare and file an EEO Public File Report, detailing information about hires made and employment recruiting sources used in the prior year, as well as on the “supplemental efforts” that they have engaged in to educate their communities about opportunities in broadcast employment. Station employment units in Alaska, Florida, Hawaii, Iowa, Missouri, Oregon, Washington, American Samoa, Guam, the Mariana Islands, Puerto Rico, Saipan, and the Virgin Islands should have placed these reports in their public file by October 1.  Stations in Alabama, Colorado, Connecticut, Georgia, Massachusetts, Maine, Minnesota, Montana, New Hampshire, North Dakota, Rhode Island, South Dakota and Vermont need to have their reports in their public file, and on their website, by December 1.  Our Broadcast Regulatory Calendar here, has dates for EEO reporting obligations for other states.

An Alabama radio station recently received a notice about the new royalty rates that are payable to ReSound, the Canadian equivalent of SoundExchange, a collective set up to receive from webcasters royalties for the public performance of sound recordings and to distribute those royalties to the copyright holders (usually the labels) and the artists who recorded the songs, according to a story in today’s issue of Tom Taylor Now (a radio industry newsletter).  Tom asked me why would a radio station in Alabama get this notice – shouldn’t their payments to SoundExchange take care of the royalties that they owe for their streaming?  In fact, webcasters receiving these notices do need to consider their practices.

The general principle in the Internet world is that a webcaster is liable for paying music royalties for listeners where the listener is located – not where the transmitting entity may be located.  The same principle applies to rights to video and other content made available through the Internet – which is why your US HBO Go or Netflix subscription may not work the next time you visit London or Tokyo and try to watch a movie on your computer in your hotel room.  Rights are usually granted country by country (or sometimes by region), but in many cases rights granted in one country don’t give the Internet service acquiring those rights permission to circulate the content worldwide.  Thus, many large webcasters block their streams outside the US – notably webcasters like Pandora, who pulled their non-US streams back in 2007 (see our article here that we wrote when they took that action, which reminds me how long I have been writing this blog!).  Continue Reading Why is a US Radio Station Getting a Notice about Webcasting Royalties in Canada? – Why Webcasters Geo-Block Their Streams to Avoid International Music Royalties

As we move into the final weeks of the election season, and races heat up, there are always issues about attack ads and what a station needs to do when they receive a “take-down” notice from a candidate who is being attacked. We recently wrote about candidate ads, and the “no censorship” provision of Section 315 of the Communications Act. Broadcasters can’t censor a “use” by a political candidate (a candidate ad that features his or her recognizable voice or image and is purchased by his or her authorized campaign committee), and thus the broadcaster is not liable for the content of the candidate’s ad. So no matter what the candidate may say – the broadcaster runs the ad as is. However, ads from third parties (PACs, SuperPACs, labor unions, right to life groups and other advocacy organizations) are different. The “no censorship” provisions of the political rules don’t apply, so broadcasters are free to accept or reject third party ads based on the content of the ads.

This question arises all the time. A station runs a third-party ad, and the politician who is being attacked by the ad will contact the station – or have their lawyer contact the station – demanding that the station pull the ad for its alleged untruthfulness. Sometimes that request has some vague (or sometimes not so vague) threat of a legal action against the station if it continues to run the ad. Unlike candidate ads (where the station cannot censor the ad and thus the station must reject all requests to pull a candidate ad, and can continue to run the ad without liability), the station makes a choice when it runs a third-party ad. Ads that are not run by the candidate’s official campaign committee (or by a political party with explicit authority and coordinated with the candidate), can be rejected based on their content – or for any other reason that the station may have – or for no reason at all.  Because stations make a decision as to whether or not they are going to run a third-party ad, they theoretically have liability if the ad is untrue and the station continues to run the ad when it has been challenged by a candidate or another party attacked in the ad. Continue Reading What’s a Broadcaster to Do When a Candidate Complains About the Truth of an Attack Ad? – Dealing with Ads from Non-Candidate, Third-Party Organizations

Could a change in the FCC treatment of Internet delivered video services be in the works – and how would that affect services like Aereo?  There were a number of published articles last week that suggested that the FCC was considering extending the definition of a Multichannel video programming distributor (MVPD) to over-the-top video providers or, as they are apparently being referred to, as Online Video Distributors (OVD) who provide linear programming like a cable or satellite company (as opposed to an on-demand provider like NetFlix).  While Chairman Wheeler at a press conference following last week’s open FCC meeting reportedly stated that the issue was “kicking around” implying that no decisions had been made, the FCC did announce that it was making a long-outstanding proceeding to look at this issue into a “permit but disclose” proceeding, meaning that parties can lobby the FCC on the issue as long as they file statements for the record disclosing the substance of their conversations with decision-makers.  What does all this mean?

If the Commission were to consider OVDs to be MVPDs, they would presumably be covered by all of the rules that apply to cable and satellite – including provisions that allow equal access to cable network programming in which the cable companies have a financial interest, and would also be subject to the must carry-retransmission consent regime that is applicable to other MVPDs, requiring MVPDs to negotiate with (and in many cases pay) TV stations to carry their programming.  The open proceeding to consider OVDs as MVPDs was started by a company called Sky Angel that focused on family-friendly programming.  The service initially delivered its programming by satellite, but migrated it to the Internet, at which time they wanted access to cable programming including Animal Planet.  When access to that programming was denied, they complained to the FCC.  The FCC staff initially denied the complaint, determining that MVPDs had to be “facility based,” meaning that they had to own the actual facilities that delivered the programming to the consumer.  The full Commission over two  years ago asked for public comment on whether this decision was correct – we wrote about that request for comment here and here – and the proceeding has essentially sat at the FCC ever since, until it began to get some renewed interest in connection with the Aereo case. Continue Reading Will FCC Extend MVPD Rules to Online Video Providers – Including Retransmission Consent Fees and Program Access Rules?

With regulatory fees behind us, October brings a number of the routine quarterly regulatory filing dates.  October 10 for all broadcast stations, commercial and noncommercial, is the date by which your Quarterly Issues Programs lists, setting out the most important issues that faced your community in the last quarter and the programs that you broadcast to address those issues, need to be placed in the physical public inspection file of radio stations, and the online public file of TV broadcasters.  As missing and incomplete Quarterly lists have led to more fines in the recent license renewal violation than any other matter, and as the FCC staffers have been reviewing some of the TV station lists that are now posted in the online public inspection files of station, completing these forms on a timely basis remains very important. 

Full power TV and Class A TV stations by October 10 also need to have filed with the FCC their FCC Form 398 Children’s Television Reports, addressing the educational and informational programming directed to children that they broadcast.  Also, by that same date, they need to upload to their online public files records showing compliance with the limits on commercials during programming directed to children.  Children’s television reports have trailed right behind the Quarterly Issues Programs lists as the source of fines at license renewal time – so be sure that these are completed and filed on a timely basis as well.  Continue Reading October Regulatory Dates for Broadcasters – Quarterly Issues Programs Lists and Children’s Television Reports, New Form for TV CP Applications, Comments on Captioning of Video Clips and Incentive Auction Reimbursement Form and More!

There are more and more signs that the FCC is moving forward aggressively with its “incentive auction” to purchase TV stations so that their licenses can be cancelled and their spectrum sold to and reused by wireless companies for wireless broadband purposes.  In two significant actions this week, the FCC gave broadcasters a first peek at the anticipated value of their stations in an incentive auction, and also clarified the interference standard that will be used by the FCC when they “repack” the stations that do not sell their licenses into a smaller post-auction TV band.  This Declaratory Ruling clarification seems to be addressed to answering some of the questions raised by the NAB in its appeal of the incentive auction order, about which we wrote here (an appeal which has been combined with a separate appeal of the incentive auction order by Sinclair Broadcasting).  But, to most television operators, the more interesting of the two actions is the report issued by the FCC suggesting the values that licensees in the various TV markets might get if they surrender their TV licenses in the incentive auction.

The Report was prepared by an investment banking firm retained by the Commission.  It sets out the procedures for the auction, and how the bidding will work. The report also contains an IRS letter suggesting the tax treatment that would be accorded licensees for incentive auction payments in various scenarios (e.g. a pure surrender of the license, or a surrender of a license as part of a channel sharing agreement, or a decision to move a station from UHF to VHF in exchange for FCC compensation).  But what most broadcasters were most interested in was the chart of projected maximum and median payments to full-power and Class A stations in each of the television markets across the country.  Those projected payments ranged from Los Angeles, where the FCC projected that the maximum that could be paid to a broadcaster for surrendering their license could be as much as $570,000,000, with the median value of a surrendered license being $340,000,000, to much smaller markets where the value, in the smallest television market of Glendive, Montana and in several smaller Alaska markets, where the FCC did not foresee any payments to TV broadcasters for surrendering their licenses. Continue Reading TV Incentive Auction Moves Forward – FCC Estimates the Value of TV Stations and Clarifies the Interference Standard for Stations Who Remain After the Auction

We wrote last week about some of the upcoming issues on the FCC’s agenda for the very short term related to the TV incentive auction to clear part of the TV spectrum for use by wireless companies, and the subsequent “repacking” of the TV stations who do not sell their licenses in the auction into the new smaller TV band.  On Thursday, the FCC took a step to make that repacking somewhat more concrete – releasing a Public Notice where the FCC’s Media Bureau seeks comment on a draft TV Broadcaster Relocation Fund Reimbursement Form (the draft form is here, and draft instructions to the form can be found here).  This will be the form that broadcasters will use to claim payment from the government for the costs of the repacking.  The Bureau asks for comments on the draft Reimbursement Form.  The comments are due on October 27, 2014.

The form provides a checklist of likely expenses, asking for details of the equipment to be bought and other expenses to be incurred in making the transition, including both hardware costs and soft costs including the reimbursement of tower crews, consulting engineers and even broadcast attorneys for filing the necessary FCC forms.  Broadcasters should carefully review the draft form to make sure that it anticipates all categories of expected expenses that stations may incur in the repacking process. Continue Reading FCC Seeks Comments on Form for Reimbursement of Expenses for Technical Changes Caused By Repacking the Television Specrum After the Broadcast Incentive Auction

As the summer of copyright comes to an end, the music licensing issues which arose causing me to repeatedly write about this extremely contentious season in copyright law are by no means finished (see the most recent of our Summer of Copyright articles here).  In fact, on the first full day of autumn, we received a very interesting decision out of a US District Court in California on the lawsuit brought by Flo and Eddie against Sirius XM, finding that the music service improperly failed to pay royalties for the public performance of pre-1972 sound recordings from the duo’s former band, the Turtles (a copy of the decision can be found in this Billboard article).  As we have written before, Flo and Eddie brought suit against Sirius XM, arguing that the service needs to get permission to make public performances of these recordings and, by not doing so, it violated their California state law copyrights. 

Pre-1972 sound recordings first registered in the US are not covered by Federal law, so the current mechanism for Sirius XM to pay for the digital public performance of sound recordings (paying a royalty, set by the Copyright Royalty Board, to SoundExchange) does not exist.  To the surprise of many (including this author) the Court concluded that there is in fact a public performance right in pre-1972 sound recordings under California state law, and went on to conclude that Sirius XM violated its obligations under the law to pay for the use of music.  This decision, on a summary decision motion, may quite well be appealed.  The issue is also before many other courts, both in California and elsewhere.  But this decision is certainly worth review, as it could have an impact not only on digital services, but also on any other company that publicly performs such recordings – including other digital music services, bars and restaurants, stadiums, and potentially even broadcasters. Continue Reading Court Rules in Favor of Flo & Eddie in California Suit Against Sirius XM for Public Performance of Pre-1972 Sound Recordings – What Does This Decision Mean for Broadcasters, Digital Media Companies and Other Music Users?

Every election season there is the same refrain from candidates who are attacked in political ads run on broadcast stations – that ad is unfair and the broadcaster who is running it should take it off the air.  Sometime, that request is sent by a lawyer with threats to bring legal actions if the broadcaster does not stop airing the ad.  What is a broadcaster to do when it gets one of these requests to pull a political ad from the air?  While we have written about this issue many times before (see, for instance, our refreshers on the rules with respect to candidate ads, here, and non-candidate, third-party attack ads, here), questions still come up all the time.  Thus, broadcasters need to know the rules so that they don’t pull an ad that they are not allowed to censor under the FCC’s rules, and that they don’t run one for which they could in fact have liability.

The rules are actually fairly simple in concept, and for ads sponsored by candidates themselves, the rules are fairly simple for broadcasters to implement.  It’s very basic – broadcasters can’t censor a candidate ad, so they can’t reject it (or remove it from the air) no matter what its content is.  The FCC has made only one exception to this “no censorship” obligation.  That exception was adopted when Larry Flint was planning to run for Federal elective office and stations feared that he would run sexually explicit campaign ads.  At that time, the FCC adopted a policy that broadcasters need not run an ad that would violate a Federal criminal law (e.g. obscenity).  That is a very narrow decision, as the Courts have even forced the FCC to make stations run without censorship graphic anti-abortion ads with disturbing content, where such ads would not be legally obscene (they might be indecent under FCC rules, and may be disturbing to some, but the airing is not a criminal violation, so the Courts said that they cannot be blocked by a broadcaster).  Because broadcasters have essentially no choice but to run a political ad in the form that the candidate provides it, and cannot reject it based on content, the Supreme Court has recognized an exemption from any broadcaster liability for the content of the ad.  So the candidate who claims that he is libeled or defamed by the political ad needs to seek relief from the candidate who ran the attack ad, not from the station.  But there are some important details that need to be observed to make sure that there is no liability for the broadcaster. Continue Reading Questions about the Truth of Political Ads, What’s a Broadcaster to Do When a Candidate Complains About an Attack Ad? – The No Censorship Rule for Candidate Ads

In a case that has been watched by many AM licensees and debated at a number of broadcast conferences in the last few years, the FCC on Friday denied the “Tell City waiver,” by which the licensee of an AM station in Indiana sought to buy an FM translator in Kentucky and move it to Indiana, on a non-adjacent channel, and use it to rebroadcast their AM station.  This sought to expand the “Mattoon waiver” (about which we have written many times including articles here and here) which effectively changed the definition of a “minor change” for an FM translator that could be approved in a single application, without waiting for any sort of translator filing window. 

The current rules define a minor change as one where the translator’s 1 mv/m service contour at both the current and proposed sites overlap.  The Mattoon waiver treated applications as minor changes where the service contours did not overlap – as long as the interfering contour of the translator at one site overlapped with the protected contour of the station at the other site – essentially meaning that a translator could not exist at both the current and proposed sites without prohibited interference.  The Tell City waiver would have eliminated even that connection between the present and proposed sites for the translator – allowing essentially a move of any FM translator from one place to another, and from one frequency to another, regardless of whether the new location had any connection with the original site.  That attempt to stretch the definition of a minor change led the Commission’s Media Bureau to deny the request. Continue Reading FCC Denies “Tell City Waiver” to Move Translator to Distant Non-Adjacent Channel to Rebroadcast AM Station