The Register of Copyrights, Maria Pallante, has made a series of speeches about the need to modernize Copyright, including offering testimony before Congress on the matter.  Her comments are but one sign that modernizing the Copyright Act has become the new catch-phrase in Washington. As the Courts have over the last few months wrestled with a host of copyright issues principally arising from digital media, boundaries that had carefully been set up by established copyright principles have been blurred – like the distinctions between a performance and a reproduction, or a public performance and one that is not.  These are distinctions that can have great importance as to who must be paid or whether any payment at all is due under current copyright laws – as in the Aereo case about which we wrote here. The call to modernize the Act is one looking for a copyright act that fits the realities of the 21st century. 

In recent months, Aereo is but one of many cases where the Courts have struggled with how to apply laws that were developed for the analog media, where boundaries are relatively clear, to the new digital world, where many copyright concepts don’t clearly fit reality. We’ve seen a number of cases interpreting the DMCA safe harbor provisions for user-generated content – including the NY State case about which we wrote here deciding Internet service providers were not excused from liability where pre-1972 sound recordings were included in user-generated content, as well as much more sweeping decisions upholding the protections of the safe harbor in broader applications, including protections extended to YouTube in its long-running dispute with Viacom. We’ve seen a decision determining that there is no right to resell digital copies – finding that the first sale doctrine (that says that consumers can resell physical goods that they buy without compensating the original creator) does not apply to digital goods. And outside the litigation sphere, we’ve seen innumerable stories about rights and royalties – from questions about Internet radio royalties like those that may apply to the new Apple streaming service, to disputes over the rights to video programs taken from one medium (like TV) and used in another (online or otherwise on-demand). 

In a speech last week to the World Creator’s Summit in Washington, DC, Register Pallante revisited the topic of Copyright reform, and laid out many of the issues that she felt needed to be addressed in any comprehensive reform that may occur. The list was long, and is bound to be controversial. She noted that the last comprehensive reform of the Act, in the 1990s leading to the Digital Millennium Copyright Act, was 20 years in the making – a delay that can’t occur now given the number of pressing issues. As she noted, the importance of copyright has never been greater to the average person. That, to me is very clear, as digital media has put so many more people in a position to be involved in copyright issues, as doing everything from creating a Facebook or Pinterest page to a YouTube video, or accessing a file on BitTorrent or any other sharing site, can immediately immerse an individual in a copyright dispute with consequences far greater than the improper use of a copy machine or cassette recorder would have had 20 or 30 years ago. So what does she propose to examine?

Continue Reading Register of Copyrights Maria Pallente Calls for Comprehensive Copyright Reform to Adapt to the Digital World – What Is Being Proposed?

The deadline for comments on the FCC’s indecency rules was extended until June 19, confirmed in a notice published in the Federal Register this past week. Given this extension, it is worth reviewing what the FCC proposed to do in this proceeding, as there is a significant amount of misinformation circulating in certain publications and in rumors floating around the Internet about the scope of the proceeding and the FCC’s intent in launching its inquiry. In preparation for a recent interview that I did with a talk show on a Midwestern radio station, I was pointed to articles that suggested that the FCC was proposing to allow swearing and nudity on broadcast television, and how that is eliciting tens of thousands of comments from the public (see, for instance the articles here and here). Some other articles and blog posts have gone further, making it sound like the FCC was looking to turn the broadcast airwaves into some sort of adult movie paradise, as if someone at the FCC had woken up one day and thought that such a relaxation of the rule would be a good idea.  While these claims make for interesting reading, the truth is much more boring, and demonstrate that the FCC has little choice but to ask for these comments.

As we wrote here, the FCC’s inquiry is initially limited – principally asking for comments on the FCC’s policy on fleeting expletives – those times, usually in a live broadcast, where a single profane word or phrase slips out onto the airwaves. The Commission also invited comments on other aspects of the rules but, other than the fleeting expletives (and a reference to fleeting, nonsexual nudity – like the bare butt that was the subject of the NYPD fine that caused the Commission much consternation in the Courts), that’s all that the Public Notice specifically addresses. While certainly more issues may arise, they arise in this context of dealing with these fleeting incidents, not as part of an attempt to turn broadcast TV into some X-rated video service.  And the issues are not being tackled as an attempt to corrupt public morality, but instead because the FCC has to clarify these rules after the Supreme Court found last summer that it had not adequately justified the more aggressive posture that it took on indecency in the last decade.

Continue Reading June 19 Comment Date on Indecency Policies – What the FCC is Not Proposing to Do, No Matter What the Internet May Say

While I was away for the last few weeks, there have been a number of actions important to broadcasters and other media companies that we’ll be covering in the next few days. For broadcasters, one annual notice that recently was released by the FCC is the proposal for this year’s annual regulatory fees which will be payable in August or September to reimburse the government for the cost of the FCC’s regulation of the industry.  Each year, prior to implementing the new fees, the FCC asks for comments on the fees to be paid by licensees – teeing up specific issues where procedures or allocations of fees for public comment before such changes are implemented. This year is no exception.  What is slightly different is that, instead of simply making its proposal for the fees to be paid by broadcasters, the FCC has instead proposed two different sets of rates, based on different ways of computing the costs of the regulation of broadcasters. 

Regulatory fees are based on the FCC’s costs of regulating its licensees and other companies subject to FCC jurisdiction. The allocation is based on the number of FCC employees who work on matters relating to that particular class of service. In the past, the FCC has had five categories of licensees – including one for broadcasters who are regulated by the Media Bureau. The FCC has proposed to reduce that number to four, reasoning that the work done by the International Bureau ("IB") benefits many different types of regulated entities, not just those satellite licensees directly regulated by that Bureau (e.g. the IB is responsible for actions including treaty negotiations and cross-border issues involving all kinds of licensees, including broadcasters). By eliminating the separate allocation for the IB, and reallocating their employees to other bureaus for fee purposes, the FCC suggests that a fairer allocation of fees will result.  Whether or not the FCC makes the proposed reallocation will most likely result in one of the possible fee schedules set forth below. 

Continue Reading FCC Proposes Annual Regulatory Fees – For Broadcasters, Fees Proposed to Increase, and FCC Proposes Future Change in UHF/VHF Fee Schedule

As is the case with most months, June brings a number of FCC deadlines for broadcasters, both standard regulatory filings and comment deadlines in important regulatory proceedings. The regular filing deadlines include license renewal applications due on June 3 (as June 1 is a Saturday) for Commercial and Noncommercial Full-Power and Class A Television Stations, TV Translators, and LPTV Stations in Ohio and Michigan; and Commercial and Noncommercial AM and FM Radio Stations, FM Translators, and LPFM Stations in Arizona, Idaho, Nevada. Noncommercial stations in the states with renewals also have to file their Biennial Ownership Reports, as do noncommercial radio stations in Maryland, Virginia, West Virginia, and the District of Columbia.

Renewal pre-filing announcements must begin on June 1 for Commercial and Noncommercial Full-Power and Class A Television Stations in Illinois and Wisconsin and for Commercial and Noncommercial AM and FM Radio Stations in California. Post-filing announcements for radio stations in Texas should continue on June 1 and 16, as well as for TV stations in Indiana, Kentucky and Tennessee.

In addition to these regular filings, broadcasters also have many other deadlines that are coming up either in the month, or soon thereafter. Broadcasters who were successful bidders in the recent FM auction have payment deadlines on June 12, and then have a July 24 deadline for the filing of "long-form" applications on FCC Form 301 specifying the technical facilities that they plan to build (see the FCC Public Notice here). Applicants for new FM translators left over from the 2003 filing window are now in a settlement window, with deadlines for settlements between competing applicants due on July 22 (see the FCC public notice here). 

Continue Reading June FCC Obligations for Broadcasters – Renewals, EEO, FM Translator and Auction Filings, and Comments on Regulatory Fees, Indecency, and Incentive Auction Band Plan

Fines against noncommercial stations may that are primarily student run may not be as harsh as they have been in the past under a ruling issued by the FCC’s Media Bureau earlier this week. The new policy came about as part of a consent decree entered into by an Iowa college-owned broadcaster whose student-run station had failed in its obligation to keep quarterly issues programs lists during most of the prior license renewal term, and also was late in meeting its obligations to file biennial ownership reports with the Commission. Instead of imposing what could have been as much as a $25,000 fine on the broadcaster, the FCC instead agreed to a consent decree by which the broadcaster contributed only $2500 to the government and agreed to certain ongoing obligations to insure its compliance with FCC rules going forward. The FCC also announced, as part of its decision in the case, that it would apply this policy of more leniency in other cases involving student-run stations in the future.  See, for instance, this decision from last year for evidence of how this policy marks a change in the FCC’s policy.

However, this new policy will apply in only very limited circumstances – only to noncommercial stations that are primarily student run. In the decision, the FCC recognized that these stations often had very limited budgets and also a high staff turnover as students graduated and new students took their place. As such, the potential for these kinds of errors increased, and yet the ability to pay for fines was small. In this case, the station involved had an annual budget of less than $7000. Were the Commission to impose big fines, these stations might be forced off the air, as the Commission noted a trend where many noncommercial student-run stations had been sold recently by colleges and universities – often leading to protests about the sales and inevitable format changes (see, for instance the decision we wrote about here).

Continue Reading FCC Adopts More Lenient Standards on Certain Fines to Student Run Noncommercial Broadcast Stations

The Librarian of Congress has announced the appointment of two new judges to the Copyright Royalty Board – marking a total change in the three judge board since the decision in the last webcasting royalty case (about which we wrote here). The two new judges are David Strickler and Jesse Feder. Mr. Strickler will serve through 2016, taking the position of Judge Wisnewski (who resigned about a year ago) as the economics expert required by the statute creating the Board. Mr. Stricker is currently Senior Counsel at a law firm in New Jersey, specializing in business litigation, according to his biography on the firm’s website, here. He also has a Masters Degree in economics, and is an adjunct economics professor as Brookdale College in New Jersey.

Mr. Feder takes the place of Judge Roberts, who was one of the original CRB judges and had worked in the Copyright Office in connection with the CARP process that set the first rates for webcasting back in 2002. Judge Roberts recently resigned from the Board. The position that Mr. Feder takes is required by statute to be filled by someone with Copyright experience. According to Mr. Feder’s online profile, he was the Director of International Trade and Intellectual Property at the Business Software Alliance, and previously held several supervisory positions at the Copyright Office and in the Library of Congress. His appointment, filling Judge Roberts’ seat, lasts only until 2014 (but he could be reappointed). 

Continue Reading Changes at the Copyright Royalty Board – Two New Judges Make for an All-New Board for the Upcoming Internet Radio Royalty Rate Setting Proceeding

Failing to properly maintain a communications tower can be expensive, as a number of FCC decisions released in the last few days demonstrate. In several decisions reached in the last week, the Commission faulted tower owners for all sorts of problems – tower lights being out without letting the FAA know, faded paint, missing fencing around an AM tower, tower registrations that had not been updated after a sale, and the failure to post the tower Antenna Survey Registration Number (“ASRN”) at the base of the tower so that the FCC could identify the tower owner. These cases provide a survey of the many issues that tower owners can have – ones that can bring big FCC fines.

In the case with the largest proposed fine – $25,000 – the FCC faulted a tower owner for having a tower with faded paint and no posted ASRN that was visible at the base of the tower. In addition, the FCC tower registration had not been updated to reflect the name of the current tower owner – even though the owner had bought the tower 10 years before. After an FCC inspection identifying the issues, the licensee promised that they would be remedied. But, according to the decision, two more inspections were made by FCC inspectors within 15 months of the first inspection, and the problems all remained. The failure to correct the errors after being repeatedly warned brought about a $10,000 increase in the fine from what would be normally warrant a penalty of approximately $15,000. Clearly, if the FCC tells you something is wrong – fix it, or face increased liability for the problems. The FCC does not like to be ignored.

Continue Reading FCC Fines Up to $25,000 for Tower Issues Including Lighting and Painting Issues, Inadequate Fencing, Tower Registration in Wrong Name and No Posted ASRN

The President has nominated Thomas Wheeler as the next FCC Chairman, to become effective after confirmation by the US Senate. What does this mean for broadcasters? As we have said before, one never really knows what issues will drive a Chairman’s agenda. For this Chair, some issues are clear – like dealing with the incentive auction to reclaim some TV spectrum for wireless use, which is inevitably marching forward. Other issues are forced on the FCC – like dealing with the indecency issues still pending after Supreme Court remand, or the multiple ownership quadrennial review still pending at the Commission while waiting for the MMTC study on the effects of media cross ownership on the ability of minorities and other new entrants to get into broadcast ownership. And some are issues that for one reason or another capture the interest or attention or concern of the FCC Chair. Usually, these issues don’t become clear until after the Chairman assumes his position, but that has not stopped many in Washington from speculating what the new Chairman will do once he is confirmed.

Interestingly, the speculation ranges the gamut, from Free Press fearing that he will be too friendly to big business because of his past service as the head of two trade associations – NCTA (the cable television industry trade association) and CTIA (the wireless industry association), to the statement of Republican leaders of the House Energy and Commerce Committee, fearing that he will impose too many regulations on these same big business organizations. In short, the perspective on the nomination seems to be based, at least in part, on the initial perspective of those who muse about what it means.

Continue Reading The President Nominates Tom Wheeler to Chair the FCC – What Will It Mean for Broadcasters?

In odd years like 2013, most broadcasting stations don’t think about the FCC’s political broadcasting rules. But they should – both for special elections to fill open seats in Congress, and for state and local political offices. This week, the news has been full of stories about next week’s special election for Congress in South Carolina, pitting former South Carolina governor Mark Sanford against Elizabeth Colbert Busch, the sister of TV host Stephen Colbert. Obviously, for a Federal election like that for the Congressional seat they are competing to fill, broadcast stations serving the district they are seeking to serve need to offer candidates the full panoply of candidate rights – including reasonable access, lowest unit rates, and equal opportunities. But in other parts of the country, as well, there are all sorts of political races taking place in this off year and, as we have written before, most of the political rules apply to these state and local electoral races as well as to the few Federal elections that are taking place to fill open Congressional seats.

Candidates for state and local elections are entitled to virtually all of the political broadcasting rights of Federal candidates – with one exception, the right of reasonable access which is reserved solely for Federal candidates. That means that only Federal candidates have the right to demand access to all classes and dayparts of advertising time that a broadcast station has to sell. As we wrote in our summary of reasonable access, here, that does not mean that candidates can demand as much time as they want, only that stations must sell them a reasonable amount of advertising during the various classes of advertising time sold on the station. For state and local candidates, on the other hand, stations don’t need to sell the candidates any advertising time at all. But, if they do, the other political rules apply. 

Continue Reading Reminder – Most FCC Political Rules Apply to Off-Year Elections for State and Local Offices

Two weeks ago, comments were filed in the Commission’s proceeding examining whether to adopt a more relaxed view of the foreign ownership provisions of the Communications Act (see our article about that proceeding here). While the Communications Act limits foreign ownership in communications licensees to 20% (or 25% of a licensee holding company), the Act also allows the Commission to allow greater foreign ownership if it would not adversely affect the public interest. In areas other than broadcasting, the Commission has routinely allowed ownership of more than 25% of a communications licensee, but the limit has been strictly enforced in the broadcasting world. Many of the comments filed in response to the Commission’s request made exactly that point – that in a multimedia world, why should a wireless company or a cable programmer be allowed to be foreign owned, while a competing broadcaster can’t have foreign investors holding more than 25% of its equity?  In what is perhaps a telling indication of where the FCC is going, the statements of three FCC Commissioners, in connection with a recent FCC decision to further streamline the approval process for alien ownership in excess of the 25% limitations in FCC-regulated areas other than broadcasting, suggested that the relaxation of the limits should also be extended to broadcasting.

Two weeks ago, in relaxing rules on the investment of non-US companies and individuals in common carrier licensees and those in certain other non-broadcast services, the Commission vastly simplified the reporting and approval process for alien ownership in excess of the statutory limits. The Commission already had in place a policy of reviewing potential foreign ownership in non-broadcast companies where, through a petition for declaratory ruling, a company could seek FCC approval for ownership, and even control, of these entities by non-US citizens or companies. In the recent proceeding, the FCC made such investment even easier, in very general terms easing certain reporting requirements for alien ownership where the interest of a specific alien investor was less than 5% (10 % in some instances), and also allowing an alien individual or group, once approved, to increase ownership without further approval (if the interest is a minority ownership interest, to 49%, and if it was controlling, to 100%), as long as the interest in possibly doing so is revealed in the original request for approval. Allowing investments by affiliates of the foreign owner, and allowing the company that is approved to seek additional licenses, all without additional approvals, was also allowed in many instances. All these changes were allowed subject to the FCC’s right to reexamine any holdings if specific issues were raised.  But what was most interesting to those in the broadcasting industry were the statements of three of the Commissioners praising these relaxations, and the hopes that the examination of applying these reforms in the broadcast world would move forward quickly.

Continue Reading A Change in the FCC’s Broadcast Foreign Ownership Rules In the Near Future?