With the holidays upon us and the end of the year fast approaching, the FCC took care of one piece of business required by statute as it released a Public Notice announcing the start of the 2022 Quadrennial Review of the FCC’s ownership rules.  The FCC is required, once every four years, to review their local ownership rules to see if they remain in the public interest.  The Notice starts the review required for this year even though the 2018 review remains pending with seemingly little likelihood of any action as long as the FCC remains politically divided (currently two Republicans and two Democrats with one open seat).

So, unless the 2018 review is decided and finds that some existing rule is no longer in the public interest and abolishes it, the just announced new review (the “Quad,” as those in DC communications regulatory circles call it) will look at the same issues as the last one did.  Ownership rules governing the limits on radio ownership in each market, largely unchanged since they were first adopted in 1996, are probably the issue that could potentially affect the largest number of broadcasters (see our articles here and here on proposals for change in the radio ownership rules).  Also under review will be issues including the Dual Network Rule, which prohibits combinations of two of the Top 4 TV networks, and a possible clarification of the Top 4 rule on local TV ownership.  The Top 4 rule generally prohibits combinations of two of the Top 4 rated TV stations in any television market.  In 2017, the FCC voted to allow parties to seek a waiver of that prohibition.  Such waiver requests are evaluated on a case-by-case basis.  The proposal raised in the 2018 proceeding was to adopt some bright line tests as to when waivers would be permitted (e.g., allowing combinations of the two lowest rated stations if their audience share did not equal that of the first or second ranked station in the market). Continue Reading FCC Starts 2022 Quadrennial Review Before the 2018 Review is Complete – Time for Another Look at Radio and TV Local Ownership Rules

As we wrote in our weekly update on regulatory issues of importance to broadcasters, the FCC released an Order last week announcing an upcoming increase in application fees to be paid on any “feeable” application.  For broadcasters, that includes applications for technical changes in facilities, applications for assignments or transfers of control of broadcast companies and stations, license renewal applications, requests for Special Temporary Authority when a station is silent or not operating with its authorized facilities, and even Biennial Ownership Reports (due to be filed by December 1, 2023).  The FCC is required by law to adjust its fees every two years to account for increases in the Consumer Price Index. With the recent increases in inflation in all sectors of the economy, FCC fees, like everything else, will be going up – by an average of about 11.6%.  The changes will be effective 60 days after the schedule of fees is published in the Federal Register – so we are talking about an effective date in 2023.

Fees do not apply to most applications by noncommercial licensees.  Otherwise, they are attached to most requests by broadcasters for FCC actions.  New fees will also take effect for non-broadcast services including private radio and satellite services for which some broadcasters hold authorizations, as well as for broadcast auxiliary applications (processed by the FCC’s Wireless Bureau). For the principal broadcast services administered by the FCC’s Media Bureau, here are the new fees that will take effect sometime in 2023:

FULL POWER COMMERCIAL AND CLASS A TELEVISION STATIONS

 

TYPE OF APPLICATION PAYMENT TYPE CODE FEE AMOUNT
New or Major Change, Construction Permit MVT $4,755/application (if no Auction)
New or Major Change, Construction Permit MVS $5,395/application (if Auction, include Post-Auction, Consolidated Long & Short Form Fee)
Minor Modification, Construction Permit MPT $1,490/application & 159
New License MJT $425/application
License Renewal MGT $370/application
License Assignment (2100 Schedule 314 & 159 (long form) MPU $1,390/station
License Assignment (2100 Schedule 316 & 159 (short form) MDT $450/station
Transfer of Control (2100 Schedule 315 & 159 (long form) MPU $1,390/station
Transfer of Control (2100 Schedule 316 & 159 (short form) MDT $450/station
Call Sign MBT $190/application
Special Temporary Authority MPV $300/application
Petition for Rulemaking for New Community of License MRT $3,790/petition

Biennial Ownership Report

(Full Power TV Stations Only)

 MAT $95/station

 

COMMERCIAL AM RADIO STATIONS

 

TYPE OF APPLICATION PAYMENT TYPE CODE FEE AMOUNT
New or Major Change, Construction Permit MUR $4,440/application
New or Major Change, Construction Permit MVR $5,085/application
Minor Modification, Construction Permit MVU $720/application
New License MMR $425/application
AM Directional Antenna MOR $1,405/application
License Renewal MGR $365/application
License Assignment (2100 Schedule 314 & 159 (long form) MPR $1,120/station
License Assignment (2100 Schedule 316 & 159 (short form) MDR $475/station
Transfer of Control (2100 Schedule 315 & 159 (long form) MPR $1,120/station
Transfer of Control (2100 Schedule 316 & 159 (short form) MDR $475/station
Call Sign MBR $190/application
Special Temporary Authority MVV $325/application
Biennial Ownership Report MAR $95/station

 

COMMERCIAL FM RADIO STATIONS

 

TYPE OF APPLICATION PAYMENT TYPE CODE FEE AMOUNT
New or Major Change, Construction Permit MTR $3,675/application, if no Auction
New or Major Change, Construction Permit MVW $4,290/application, if Auction, include Consolidated Long and Short Form Fee
Minor Modification, Construction Permit MVX $1,410/application
New License MHR $260/application
FM Directional Antenna MLR $705/application
License Renewal MGR $365/application
License Assignment (2100 Schedule 314 & 159 (long form) MPR $1,120/station
License Assignment (2100 Schedule 316 & 159 (short form) MDR $475/station
Transfer of Control (2100 Schedule 315 & 159 (long form) MPR $1,120/station
Transfer of Control (2100 Schedule 316 & 159 (short form) MDR $475/station
Call Sign MBR $190/application
Special Temporary Authority MVY $235/application
Petition for Rulemaking for New Community of License MRR $3,550/petition
Biennial Ownership Report MAR $95/station

 

FM TRANSLATORS

 

TYPE OF APPLICATION PAYMENT TYPE CODE FEE AMOUNT
New or Major Change, Construction Permit MOF $785/application, if no Auction
New or Major Change, Construction Permit MVZ $1,430/application, if Auction, include Consolidated Long and Short Form Fee
Minor Modification, Construction Permit MWA $235/application
New License MEF $200/application
FM Translator/Booster License Renewal MAF $195/application
FM Translator/Booster Spec. Temp. Auth. MWB $190/application
FM Translator License Assignment (2100 Schedule 345 & 159, 314 & 159, 316 & 159) MDF $325/station
FM Translator Transfer of Control (2100 Schedule 345 & 159, 315 & 159, 316 & 159) MDF $325/station
FM Booster, New or Major Change, Construction Permit MOF $785/station
FM Booster, New License MEF $200/application
FM Booster, Special Temporary Authority MWB $190/application

 

SECTION 310 (b) (4) FOREIGN OWNERSHIP PETITION

 

TYPE OF APPLICATION PAYMENT TYPE CODE FEE AMOUNT
Foreign Ownership Petition (separate and additional fee required for underlying application, if any) MWC $2,775/application

 

TV TRANSLATORS AND LPTV STATIONS

 

TYPE OF APPLICATION PAYMENT TYPE CODE FEE AMOUNT
New or Major Change, Construction Permit MOL $865/application, if no Auction
New or Major Change, Construction Permit MOK $1,505/application, if Auction, include Consolidated Long and Short Form Fee
New License MEL $240/application
License Renewal MAL $160/application
Special Temporary Authority MGL $300/application
License Assignment (2100 Schedule 345 & 159, 314 & 159, 316 & 159) MDL $375/station
Transfer of Control (2100 Schedule 345 & 159, 315 & 159, 316 & 159) MDL $375/station
Call Sign MBT $190/application

Here are some of the regulatory developments of significance to broadcasters from the past week, with links to where you can go to find more information as to how these actions may affect your operations.

  • By a Public Notice issued on December 15, the FCC’s Public Safety and Homeland Security Bureau told broadcasters to submit their annual Form One filings for calendar year 2022 in the online EAS Test Reporting System (“ETRS”) between January 3 and February 28, 2023.  ETRS Form One requests basic information about contact persons at a station, the model of EAS equipment used, and monitoring assignments under the legacy EAS system.  The Bureau explains that it is important that EAS Participants confirm that the information they enter is accurate and that they correct any past filing errors.  Further information about the filing will be provided in a future Public Notice. There was no nationwide EAS test during 2022 and, while FEMA has not announced a test date for 2023, one is expected in the coming year.
  • The FCC’s Media Bureau issued a Public Notice granting an extension of the deadlines for comments and reply comments on the FCC’s Second Notice of Proposed Rulemaking on its foreign government sponsorship identification rules. Comments are now due January 9, and reply comments are due January 24.  As we wrote on our Broadcast Law Blog, the Second Notice seeks comment on proposals to adopt an enhanced and standardized certification that all buyers of program time on any broadcast station (or those who provide any pre-produced programming received for free) would have to sign to verify whether that programming comes from a “foreign government entity,” i.e., a foreign government or one of its agents. Programming provided by a foreign government entity is subject to extensive public disclosure obligations.  The Second Notice also proposes that the certifications, whether or not they indicate that the program buyer is a foreign government entity, be included in a station’s online public file, and also proposes to confirm that advertising material two minutes or less in length, is not “program time” subject to the rule.
  • The FCC issued an Order announcing its required adjustment in the amount of the fees paid for FCC applications, including fees paid by commercial broadcasters for applications for construction permits, assignments and transfers, license renewal, and even for the Biennial Ownership Reports that will be due late in 2023. The FCC is required by law to adjust the fees every other year to reflect the increase in the Consumer Price Index.  The increase in CPI in the last two years will mean an upward adjustment in the fees of approximately 11.6%, effective 30 days after this Order is published in the Federal Register.
  • The Media Bureau fined an AM licensee $20,000 (an unusually large amount for an AM station) for variety of rule violations stemming from the station’s operation at variance from its authorized parameters. The station had been authorized to operate in a non-directional mode at 10 kilowatts during daytime hours, and in a directional mode at 5 kilowatts during nighttime hours.  The station conceded that, for over 30 years, notwithstanding multiple complaints and an Enforcement Bureau inquiry, it had operated non-directionally at night at 1 kilowatt to overcome coverage issues.  The station never sought special temporary authority nor applied to modify its license for such operation, even though it was told to do so at least twice since 2016.  The Bureau rejected the licensee’s arguments that it should not be fined, and actually adjusted the fine upward, due to the licensee’s willful conduct, from what would be the normal $10,000 base fine for an unauthorized operation.
  • The Media Bureau issued a letter in which it denied an objection seeking dismissal, under the FCC’s “inconsistent applications” rule, of one of two mutually exclusive applications filed by an applicant during the 2021 NCE FM Filing Window. The rule is a general one, prohibiting the filing of inconsistent or conflicting applications by the same applicant.  Here, the objecting party, citing the rule, alleged that the applications were inconsistent as both could not be granted due to prohibited contour overlap, and that the latter-filed application should therefore be dismissed.  The Bureau pointed out that the FCC has held that the rule does not apply to applications to be awarded by auctions, and that same reasoning should apply to processing new, mutually exclusive NCE FM applications as these applications would not unduly burden the FCC’s resources or slow the processing of applications filed in the window.
  • The Media Bureau has issued a Notice of Proposed Rulemaking requesting comments on the proposed allotment of FM channel 277C2 to Wharton, Texas, as the community’s second local service. Comments are due February 6 and reply comments are due February 21.  If allocated as requested, the channel would be available for applications for a construction permit for a new FM station in a future FM auction window.
  • The Federal Election Commission’s December 1 action providing details on the sponsorship disclosures required for paid online political communications is scheduled to be published in the Federal Register on Monday, meaning that the new rules will be effective on March 1. We wrote about the FEC’s action here.
  • On our Broadcast Law Blog this week, we wrote about the recent statements by Senator Ed Markey and FCC Commissioner Nathan Simington in support of AM service, a recent statement from the BBC about the possible end of broadcast service, and how those actions should inform future FCC regulatory actions, particularly regarding broadcast ownership limits. We also wrote more about a recent FCC e-mail to all broadcasters warning them of a cybersecurity flaw in the DASDEC EAS encoder/decoder device sold by Digital Alert Systems (formerly Monroe Electronics), using software prior to version 4.1.

We will not publish this update next week because of the holidays but will be back in the New Year with a summary of any regulatory actions of importance to broadcasters that occur in the last two weeks of the year.  In the interim, we’ll highlight any major actions on our Broadcast Law Blog.

In the last few weeks, a Democratic Senator and a Republican FCC Commissioner have both expressed support for the future of AM radio.  This is not a new topic, being the subject of speculation for at least the last 20 years as FM listening caught up to and surpassed the older service’s audience.  But, when considering worldwide trends, a real question arises as to whether this inquiry is too narrow, and whether the FCC should not be taking more steps to insure the continuation of a free, local broadcast service.

In the last decade, the FCC has considered and, in many cases adopted, various proposals to revitalize the AM service – including providing FM translators for AM stations (see our articles here and here) and permitting all-digital AM operations (see our article here).  Other proposals, including one for across-the-board power increases for AM stations (see our article here) and another to lessen the interference protection enjoyed by high powered “clear channel” AMs, which would allow lower power local AM stations to increase nighttime power (see our article here), have not been adopted.  What new issues are being raised by these recent expressions of support from DC regulators? Continue Reading Washington Worries About AM Radio – Senator Markey and Commissioner Simington Weigh in on the Future of the Service While Overseas There are Thoughts of Ending Broadcasting Altogether

In our summary of this week’s regulatory actions of importance to broadcasters, we noted that the FCC sent an email to broadcasters last week warning them of a cybersecurity flaw in the DASDEC EAS encoder/decoder device sold by Digital Alert Systems (formerly Monroe Electronics), using software prior to version 4.1. The email states that the Cybersecurity and Infrastructure Security Agency (CISA) issued an advisory expressing concern that there is a vulnerability in the code used by the system that can be used by remote attackers.  The CISA advisory provides the technical details of the vulnerability.

The fear is that this security flaw can allow bad actors to access not only to the EAS system but, if that system is connected to other station computer networks, to other station information and systems as well.  Securing the EAS system has been a priority of the FCC, with a pending rulemaking proposal (about which we wrote here) that would require stations to adopt cybersecurity plans to secure these systems and report yearly to the FCC about those plans (and report breaches when the station learns of such breaches or when they should have learned about the breach).  The FCC already requires that false EAS alerts be reported to the FCC within 24 hours (see our article here) – but the new proposal would require FCC notice even if no false alert occurred.  With the FCC contemplating the imposition of these obligations on broadcasters, and (of paramount priority) the risks that station operations can be compromised by any cyberbreach, stations need to be extra-vigilant in their cybersecurity considerations.  Thus, any stations that use the identified encoder/decoder must be sure that they have taken the proper actions to secure their stations. Continue Reading FCC Warns Broadcasters of Specific Cybersecurity Flaw in One EAS Provider’s Equipment – Why Broadcasters Need to Pay Attention

Here are some of the regulatory developments of significance to broadcasters from the past week, with links to where you can go to find more information as to how these actions may affect your operations.

  • The FCC has sent an e-mail, apparently to all broadcasters, regarding the cybersecurity of broadcast stations that use the DASDEC EAS encoder/decoder device sold by Digital Alert Systems (formerly Monroe Electronics), using software prior to version 4.1. The email states that the Cybersecurity and Infrastructure Security Agency issued an advisory expressing concern that there is a vulnerability in the code used by the system that can be used by remote attackers.  The e-mail recommends that stations using this equipment make sure that they have downloaded the latest updates containing a patch to the vulnerability, and adopt good “cyber hygiene,” including the steps set forth in the FCC’s August 5 Public Notice on that subject, which include updating passwords, using firewalls and isolating equipment that may be subject to attack.
  • On Wednesday, the House Judiciary Committee held a “mark-up session” for the American Music Fairness Act, which proposes to impose a sound recording performance royalty on over-the-air broadcasting. This bill proposes a royalty paid to SoundExchange by over-the-air radio to benefit the recording artist and copyright holder (usually the record company), in addition to the royalties already paid to composers and publishing companies through ASCAP, BMI, SESAC and GMR.  The Committee approved the bill, passing it on to the full House of Representatives for consideration.  The full House and the Senate would have to approve it, and have it and signed by the President, before it became law.  With the current session of Congress coming to a close at the end of the month, if not approved this month, the proposed legislation would need to start over in the new Congress in January.  Thus, unless the bill is tacked on to some must-pass legislation in this “lame duck” session of Congress, this week’s action by the Committee is likely a marker for action in the new year. We wrote more about the bill and its impact this week on our Broadcast Law Blog
  • The FCC has published in the Federal Register the Report and Order (R&O) that updates the FCC’s rules to identify Nielsen’s monthly Local TV Station Information Report as the new publication for determining a television station’s designated market area for satellite and cable carriage purposes.  As a result, the R&O and associated rule changes will be effective January 6, 2023.  For more details, see our articles here and here.
  • As we’ve previously reported, the Federal Election Commission (“FEC”) has adopted new disclaimer requirements for internet-based political advertising, including detailing the required identification of the ad sponsor.   When it adopted its new rules, the FEC rejected a broader proposal that would have included not just communications where the owner of the digital platform was paid for the inclusion of the ad, but also political communications where the platform itself may not have been paid, but where the sponsor of the communication paid others to promote or otherwise broaden the dissemination of the communication.  Instead, the FEC issued a Supplemental Notice of Proposed Rulemaking seeking public comment as to whether disclaimers should be required for such promoted communications. The Supplemental Notice was published in the Federal Register on December 9, meaning that public comments are due by January 9, 2023. The Supplemental Notice asks about the impact of such a rule, and whether the FEC’s proposed rules for sponsorship disclaimers for promoted communications appropriately covered the issues. These rules are important to influencers and other social media users who are paid to promote political messages.
  • The FCC’s Media Bureau has entered into a Consent Decree due to the operation of a station by the deceased licensee’s daughter (the licensee’s beneficiary) for nine years after the death of the licensee, without anyone seeking any FCC approval for her assumption of control. The estate and the daughter were required to pay a $7,000 fine and adopt a mandatory plan to ensure compliance with the FCC rules that had been violated. The FCC rules require that the FCC be notified of a licensee’s death within ten days, and to seek approval for an involuntarily transfer control of the station’s license to the estate within 30 days. Once the estate has been probated, another application to transfer control to the beneficiary is also required. None of those applications were filed for nine years in this case. In addition, the parties admitted that they had not timely uploaded records to the station’s online public inspection file, and were further found to have violated the FCC’s ownership report rule, apparently for failing to file a biennial ownership report by December 1 in all odd-numbered years.  The case is a reminder that upon the death or incapacity of a licensee or a controlling owner of a licensee, the FCC needs to be notified and approve those who subsequently control the station (similar rules apply where a licensee goes into bankruptcy).
  • On our Broadcast Law Blog this week, we wrote more about the meaning and implications for local advertising of the FTC decision we noted in last week’s regulatory update, fining Google and iHeart Radio for running ads by local announcers touting their use of a new Google phone, which they in fact had not used. In our article, we noted that all media companies need to make sure that any ad using endorsements or testimonials is fully accurate and meets FTC guidelines to avoid penalties for deceptive advertising.

 

All media companies, including broadcasters, webcasters, podcasters and others, need to consider carefully their advertising production after the big penalties imposed on Google and iHeart for broadcast commercials where local DJs promoted the Pixel 4 phone.  Promotions included statements that clearly implied that the announcers had used the phone, including statements that it was “my favorite camera” and “I’ve been taking studio-like photos” with the phone.  But, according to the announcements of the settlement with the Federal Trade Commission and seven state attorneys general (see the FTC press release and blog article), the announcers had not in fact used the phone.  Google will pay the states penalties  of $9 million, and iHeart will pay about $400,000 (see example of the state Court filings on the settlement, this one for Massachusetts, for Google and iHeart).  Each will enter into consent orders with the FTC (Google order here and iHeart here) requiring 10-year recordkeeping and compliance plans to train employees, maintain records of advertising with endorsements, and reports to be filed periodically with the FTC.

The mission of the FTC is to protect the public from deceptive or unfair business practices and from unfair methods of competition.  In that role, the FTC regulates deceptive advertising practices.  Over a decade ago, we highlighted the FTC’s update of its policies on “testimonial and endorsement advertising” that made clear that the FTC required that any sort of “celebrity” (interpreted broadly) endorser had to have a basis for the claims that they were making in their pitches for a product.  This notice also made clear that any statements made about the experience in using a product had to be accurate and, when making claims about the performance of a product, the endorser had to accurately state performance that users can expect to obtain when they use the product.  Just using a “your results may vary” disclaimer was not enough.  In the 2009 proceeding, the FTC emphasized the applicability of these standards to online promotions, requiring disclosures for not only traditional advertising but also for social media influencers and others who are paid to promote products through online channels.  Such payments (or any other valuable consideration the influencer receives) must be disclosed when pitching a product. Continue Reading Big FTC Penalties on Google and iHeart for Deceptive Endorsements in Broadcast Commercials Mandate Care in Crafting Your Local Advertising

On Wednesday, the House Judiciary Committee will be holding a “mark-up session” (see this notice of the session) where they will be considering the American Music Fairness Act which proposes to impose a sound recording performance royalty on over-the-air broadcasting.  This would be a royalty paid to SoundExchange to benefit the recording artist and copyright holder (usually the record company) and would be in addition to the royalties already paid to composers and publishing companies through royalties paid to ASCAP, BMI, SESAC and GMR.  A mark-up session considers amendments to the bill and could lead to the committee’s approval of the bill.  If approved by the Committee, the bill would still need to be approved by the full House of Representatives and the Senate (and signed by the President) before it became law.  With the current session of Congress coming to a close at the end of the month, the proposed legislation would need to start over in the Congress.  Thus, unless the bill is tacked on to some must-pass legislation in this “lame duck” session of Congress, any action this week by the committee will likely simply be a marker for action in the new year.

The NAB has already issued a statement about the session, pointing out that a majority of the House members have signed on to the Local Radio Freedom Act stating that they will not vote for this legislation.  The statement also reiterates the NAB’s interest in working on a “mutually beneficial solution” to the issue of the broadcast performance royalty (an interest in a possible solution we wrote about here).  Nevertheless, with this issue back on the table, even if only in a symbolic way, we thought that we should re-post our summary of the American Music Fairness Act and the issues that it raises that we wrote last year, when the legislation was first introduced. Continue Reading House of Representatives Judiciary Committee to Consider American Music Fairness Act Proposing Sound Recording Performance Royalty on Over-the-Air Broadcasting

Last week, the Federal Election Commission (FEC) adopted new disclaimer requirements for internet-based political advertising, including the identification of the ad sponsor.  This decision resolves many of the issues that have been debated at the FEC for over a decade as to what internet content is considered a “public communication” that requires a disclosure of the sponsor of the content – and just what the disclosure should reveal.  We wrote about a 2018 rulemaking soliciting comment on these issues that was just part of the process that led to the vote taken last week.  While the FEC had generally acknowledged that online political ads should have some sponsorship identification, it is only now that the FEC has adopted detailed requirements for this identification.  As discussed below, the proceeding requires disclosures when a sponsor pays an online platform to transmit the political message.  However, the FEC postponed for another day consideration as to whether the disclaimers would be required when the sponsor pays others to promote or widely disseminate the message to platforms that are not paid (e.g., where people are paid by a sponsor to post political messages on social media sites).  These rule changes will impact most media companies with websites and mobile apps, as well as the nationwide streaming services now developing ad supported platforms.

Specifically, the FEC adopted a proposal that would amend its rules to require a disclaimer on those “communications placed for a fee on another person’s website, digital device, application, or advertising platform.”   The FEC also issued a Supplemental Notice of Proposed Rulemaking seeking public comment as to whether disclaimers should be required for political communications where the platform itself may not have been paid, but where the sponsor of the communication paid others to promote or otherwise broaden the dissemination of the communication. Continue Reading Federal Election Commission Adopts New Rules for Sponsorship Disclaimers for Online Political Advertising – And to Consider Rules for Political Marketing Through Social Media Influencers 

In a very busy week, here are some of the regulatory developments of significance to broadcasters from the past week, with links to where you can go to find more information as to how these actions may affect your operations.

  • The Federal Trade Commission and seven state Attorneys General announced a settlement with Google LLC and iHeart Media, Inc. over allegations that iHeart radio stations aired thousands of deceptive endorsements for Google Pixel 4 phones by radio personalities who had never used the phone.  The FTC’s complaint alleges that in 2019, Google hired iHeart and 11 other radio broadcast companies to have their on-air personalities record and broadcast endorsements of the Pixel 4 phone, but did not provide the on-air personalities with the phone that they were endorsing.  Google provided scripts for the on-air personalities to record, which included lines such as “It’s my favorite phone camera out there” and “I’ve been taking studio-like photos of everything,” despite these DJs never having used the phone.  The deceptive endorsements aired over 28,000 times across ten major markets from October 2019 to March 2020.  As part of the settlement, subject to approval by the courts, Google will pay approximately $9 million and iHeart will pay approximately $400,000 to the states that were part of the agreement.  The settlement also imposes substantial paperwork and administrative burdens by requiring both companies to submit annual compliance reports for a period of years (10 years in the case of iHeart), and create and retain financial and other records (in the case of iHeart, the records must be created for a period of ten years and retained for five years).
    • This case is a reminder that stations must ensure that their on-air talent have at least some familiarity with any product they endorse, particularly where on-air scripts suggest that they have actually used the product.  Stations should not assume that talent know the relevant rules – they more likely will just read whatever is handed to them without understanding the potential legal risk for the station, which, as demonstrated in this case, could be significant.

Continue Reading This Week in Regulation for Broadcasters: November 26 to December 2 , 2022