In one more indication that the Broadcast Performance Royalty (or "performance tax" as opponents of the legislation call it) is not dead yet is an article in yesterday’s New York Times reviewing the issues at stake in the proceeding.  What was perhaps most interesting about that article was the fact that it appeared only one page away from an article about Internet Radio service Pandora, and a discussion of how that hugely popular service was almost driven out of business by music royalties set by the Copyright Royalty Board in their 2007 royalty decision.  The article about the broadcast performance royalty mentions that one of the difficulties in assessing the impact of the proposed royalty is that no one knows how much it will be, as it would be set by the Copyright Royalty Judges on the CRB.  Yet the Times makes no mention of the controversy over the previous decisions of the Board in the context of the Internet radio royalties, and how such royalties almost impacted services such as Pandora.  

How much would the proposed royalties on broadcasters be?  We have written before on that subject,here.  Under previous decisions using the "willing buyer, willing seller" royalty standard which is set out in the legislation that has passed House and Senate Judiciary committees dealing with this issue, the lowest royalty for the use of music in any case before the CRB has been 15% of gross revenues.  Even using a standard seemingly more favorable to the copyright user (the 801(b) standard that assesses more than the economic value of the music but also looks at the impact that the royalty would have on the stability of the industry on which it is imposed), the royalties have been in the vicinity of 7% of gross revenues for both satellite radio and digital cable radio, the two services that are subject to royalties set using the 801(b) standard.  This is more than broadcasters currently pay to ASCAP, BMI and SESAC – rates which are also currently the subject of proceedings to determine if these rates should be changed (see our posts here and here).   

Continue Reading Proposed Broadcast Performance Royalty Back in the News – Where is It Going?

 

David Silverman participated on a panel discussing the legal aspects of social media at the Great Lakes Broadcasting Conference in Lansing, Michigan on March 3, 2010. His PowerPoint presentation focused on the risks and benefits of using Twitter, Facebook and other social media in the employment context, including use by broadcasters. There are a number of laws that impact both the protection and vulnerability of social media. The bottom line is that stations need to determine the extent to which social media use will be permitted and/or encouraged in the workplace and then develop a social media policy that will delineate the ways in which station employees can use social media with regard to station matters, while at work or at home.  A copy of David’s PowerPoint presentation from the session is available here. 

Using music in commercials is not as simple as just paying your ASCAP, BMI and SESAC royalties.  While many broadcasters think that paying these royalties is enough to give them the rights to do anything they want with music on their stations, it does not.  The payments to these Performing Rights Organizations (PROs) only cover the right to publicly perform music, i.e. to broadcast it.  They do not give you the right to take the music and "synchronize" it with other words or video material, e.g.  you cannot put music in a recorded commercial or otherwise permanently fix it into a recorded audio or video production.  Instead, to make such a production, the producer needs to get the rights to both the underlying musical composition (the words and musical notes) and, if you are planning to use a particular recording of a song, the rights to use that particular recording ( the "sound recording" or "master recording").  Getting these rights may very well require that you deal both with the record company or performing artist whose recording you plan to use, and the publishing company that represents the composer of the music.  And, as some artists may have concerns about having their music used to pitch some products, getting the rights to that artist’s version of a particular song may not be easy. 

Even using the tune of a familiar song in an advertisement, with different words, is not permitted without getting the rights to do so from the publishing company.  A copyright holder in a musical composition has the right to prepare "derivative works" of that composition.  A derivative work is one that uses the original copyrighted material, but changes it somehow – like putting new words to an old tune.  Many think that "fair use" permits the making of a parody of a song, so they are allowed to use the tune as long as they produce a new version that is funny.  However, in the copyright world, fair use is not that simple.  A parody, to allow use of the original tune, must be making commentary or criticism of the original song.  Being independently funny or amusing, or otherwise dealing with some independent social or political issue, does not give you the right to use the music without securing permission from the composer of the music first.  A recent story in the Hollywood reporter’s legal blog, THR,esq.com, told the story of a Congressional candidate, Joe Walsh, who thought that it would be cute to use the music of former Eagle Joe Walsh, to make fun of Democratic politicians.  As set out in that story, Eagle Joe Walsh’s attorney did not find the campaign song very funny, and sent a very strong letter objecting to that use (the LA Times site had at one point had a link to a video of a band playing the candidate’s version of the Joe Walsh song "Walk Away", but it now says that the video has been taken down due to a copyright objection). Don’t let your station be the recipient of such a letter – get the rights to use music in commercials or other productions. 

Continue Reading Using Music in Advertising or In a Video Production? Secure the Necessary Rights – ASCAP, BMI and SESAC Licenses Are Not Enough

The FCC’s rules limiting the common ownership of radio and television stations, and of television stations and daily newspapers, are triggered by the Grade A contours of the television station encompassing the city of license of the radio station, or the city in which the newspaper is published.  Since June, there has been one problem with the application of that rule (Section 73.3555) – television stations in the digital world no longer have Grade A contours.  When adopting service contours for digital television, the FCC specified a Noise Limited Service Contour ("NLSC") as essentially the equivalent of the Grade B contour of an analog television signal – the contour at which the majority of people can receive the signal a majority of the time.  The FCC also specified a principal city contour – the signal level that needed to be placed over a station’s city of license.  But the FCC never bothered to specify the Grade A contour, despite the fact that the cross-ownership rules were premised on that contour.  In a case decided last week involving the financial restructuring of a radio company, the FCC’s Media Bureau staff decided that they would use the NLSC as a proxy for the Grade A contour until such time as the full Commission otherwise directed.

This decision actually makes common ownership of television stations and either newspapers or radio stations somewhat more difficult, as the noise limited contour, approximating the old analog Grade B contour, actually extends further than where the Grade A contour would have reached (when a digital station replicated its analog service area).  Thus, using this standard, the owners of a television station could be precluded from having attributable interests in radio stations or daily papers in more communities than would have been the case in the analog world.  As the FCC is now embarking on its review of the multiple ownership rules (as we have written before), the FCC may well revisit this issue in the course of that review.

Continue Reading FCC Clarifies Application of the Multiple Ownership Rules After the Digital Transition Makes the Grade A Contour Disappear

Getting legal education from a fake news program is always dangerous, but a recent episode of the Stephen Colbert Show, here, nicely demonstrated trademark law.  The clip illustrates what we have written before, that the term "Olympics", like "Super Bowl" and "March Madness" are trademarked, and attempts to use them in commercials or promotions, or to otherwise imply that a product or program is associated with one of these events, can lead a broadcaster into legal trouble and potential liability.  The Colbert program shows Stephen discussing with his brother, a trademark lawyer, Stephen’s ideas for associating his program with the Olympics and, when his brother consistently rejects the plans, Colbert tries to change the 5 ringed Olympic symbol to five interlocking triangles, and other symbols that are similar, and Colbert is told that each is likely to bring a lawsuit.  Only when Colbert abandons the Olympic name, and the symbols, and comes up with a name – The Quadrennial Cold Weather Athletic Competition – that is the equivalent to the "Big Game" that many use when referencing the Super Bowl, was the brother satisfied that Colbert would not get successfully sued.  Stations should take similar precautions when thinking about using these terms in their programs.

Using the trademarked word or phrase in news reports about the event, or in other commentary, is in many cases just fine.  But trying to imply an endorsement or connection to the event for which true sponsors pay "big bucks", can get you into trouble, as explained by Mr. Colbert.  Thus, just as we looked to Colbert for examples of how music licensing works, and on when a candidate becomes legally qualified, he illustrated another legal concept.  When will we next look to Mr. Colbert for an explanation of the law?  Stay tuned.

When someone "lobbies" the FCC on issues pending in a rulemaking proceeding or other contested case, the Commission requires that there be a certain amount of disclosure of the communications made to Commission decision-making personnel.  The rules governing the communications with the FCC’s decision-making personnel in such cases are called the "ex parte" rules.  These rules preclude some communications entirely (e.g. oral communications trying to influence a decision in a contested individual case unless all parties to the case are present, or any presentations in rulemakings in the last week before the FCC meeting at which it will be considered), and allow some communications, but with disclosure to the public (e.g. comments made to FCC Commissioners by parties, written or oral, in rulemaking proceedings).  The FCC has just commenced a new proceeding to look at whether the disclosures that are made after some of the communications with decision makers are detailed enough, and also whether new technologies used by the FCC (like its Blogs for various subjects including the blog dedicated to comments on the Future of the Media Proceeding, about we’ve written before) make some of the ex parte rules outmoded.

A full summary of the proceeding is available in our Davis Wright Tremaine advisory, here.   Comments are due 45 days after the Notice of Proposed Rulemaking in this proceeding is published in the Federal Register. 

On Friday, Feb. 19, 2010, two important new closed captioning rules were published in the Federal Register and went into effect. The new rules require immediate attention by video programming distributors — including broadcast television stations — to ensure that they respond promptly to viewer complaints regarding closed captioning issues, and to ensure that they timely file contact information with the FCC by March 22, 2010. 

As detailed in Davis Wright Tremaine’s November 2008 advisory and subsequent January 2009 advisory update, the Federal Communications Commission (FCC) adopted a Declaratory Ruling and Order in late 2008 that, among other things, imposed new requirements on video programming distributors with respect to fielding inquiries and complaints about closed captioning.  While the implementation of some aspects of those rules was delayed initially, with Friday’s publication in the Federal Register, two of those are now in effect.  The new rules, and the obligations they impose on video programming distributors, are discussed below. 

Continue Reading Closed Captioning Update: New Complaint Rules Now Effective; Contact Information Due by March 22, 2010

The FCC announced an extension of the comment filing deadline in its proceeding looking at the Future of the Media (see our summary here). At the same time, the Steven Waldman, the Special Assistant to Chairman Genachowski, made a public appearance at the FCC’s open meeting last week to explain what is intended by this study – and from his comments and those of the Commissioners, this will be a wide-ranging investigation looking at how FCC and other government regulations can insure diversity in the media so that citizens and communities can "get the information that they need."  In Commissioner Copps comments, this includes looking at what public interest obligations are appropriate for the new digital media.  Comments in this proceeding, which were to be filed in March, are now to be submitted by May 7, 2010.

The appearance of Mr. Waldman (whose appointment we wrote about here) came at the very end of a long Commission open meeting where extensive discussions were held on reforming the FCC’s internal decision-making processes and about the broadband deployment report which has consumed the FCC for many months, and which will be delivered to Congress in the next few weeks.  But, while short, the discussion with Mr. Waldman was interesting as he highlighted the plans for his task force.  He opened his comments by initially noting how this was a time of great change in the media, where there is "incredible diversity" brought forth by the new technologies, but that there was also a "collapse" of traditional business models, which could bring about the end of "accountability journalism" (presumably journalism from reputable journalistic sources with some degree of accountability and reliability).  Because of these perceived changes, according to the comments made at the meeting, this task force was established to determine what the government can do to make sure that communities get the information that they need.

Continue Reading FCC Extends Time For Comments on the Future of the Media – Looking at the Public’s Interest in Quality Journalism in All Media

On February, 18, 2010, David Oxenford conducted a seminar for the Utah Broadcasters Association on legal issues that affect radio and television broadcasters.  First, David summarized the various broadcasting legal and policy issues pending before the FCC and Congress.  David’s PowerPoint presentation is available here.  Broadcasters interested in Washington issues that may affect them this year may also want to read our blog post from early January where we presented our legal predictions for 2010.

David then conducted a refresher course on political broadcasting issues that may arise in this election year.  His PowerPoint on political issues for broadcasters can be viewed here.  Broadcasters wanting more information on the FCC’s political broadcasting rules and policies should review the Davis Wright Tremaine Political Broadcasting Guide.  A discussion of the issues for broadcasters raised by the recent Citizen’s United case is available here.

Finally, David discussed recent developments in enforcement of the FCC’s EEO policies.  The PowerPoint used in this session can be seen here .  Our Advisory on EEO rules and policies is available here, with forms and recordkeeping suggestions attached to that memo.  Our most recent EEO Public Inspection File Report advisory, with a model report attached, is available here.  Finally, our description of one of the recent FCC fines for noncompliance with the EEO policies is available here. 

The New York Times just ran an article on the number of radio and television commentators who are also potential political candidates, speculating on whether the appearance of these candidates on TV and cable talk shows, and on radio programs, give them an advantage in their future political careers.  That perceived TV bump might be most in the news in the potential candidacy of Harold Ford in the Democratic Senate primary in New York, with his appearances on MSNBC (and this past weekend on Meet the Press on NBC, where he was part of a panel to talk about the week’s news, and was then asked about his future political plans).  But it is also evident in the almost daily parade of potential candidates on radio, TV and cable talk programs.  So, one might ask, what are the FCC implications of these appearances?

The week before last, we wrote on this question, in connection with on-air radio or TV performers who actually become candidates, and how a broadcast station should deal with those candidates and the equal opportunities obligations to opposing candidates that arise when these employee-candidates appear on the air.  But the question of when the equal opportunities obligations arise is one that we only touched on.  Under the FCC’s interpretation of the Section 315 of the Communications Act, the equal opportunities obligations arise once you have a legally qualified candidate – one who fulfills all of the obligations that a state imposes for securing a place on the ballot.  Usually, this involves the filing of certain papers, often with petitions signed by a specified number of registered voters, with a state’s Secretary of State by a given deadline.  Once the requirements established by the state have been met, the candidate is legally qualified and equal opportunities attach to any on air appearances outside the context of an exempt program (see our post here about those appearances, principally in news and interview programs, which are exempt from equal opportunities). 

Continue Reading When Potential Candidates Like Sarah Palin, Mike Huckabee, and Harold Ford Are On Radio, TV and Cable – FCC Issues?