broadcast ads for medical marijuana

Earlier this week, we covered the broadcast issues that the FCC may be facing in 2024.  But the FCC is just one of the many branches of government that regulates the activities of broadcasters.  There are numerous federal agencies, the Courts, Congress, and even state legislatures that all are active in adopting rules, making policies, or issuing decisions that can affect the business of broadcasting and the broader media industry.  What are some of the issues we can expect to see addressed in 2024 by these authorities?

For radio, there are music rights issues galore that will be considered.  Early in the year, the Copyright Royalty Board will be initiating the proceeding to set streaming royalties for webcasters (including broadcasters who stream their programming on the Internet) for 2026-2030.  These proceedings, which occur every five years, are lengthy and include extensive discovery and a trial-like hearing to determine what royalty a “willing buyer and a willing seller” would arrive at for the noninteractive use of sound recordings transmitted through internet-based platforms.  Because of the complexity of the process, the CRB starts the proceeding early in the year before the year in which the current royalty rate expires.  So, as the current rates expire at the end of 2025, parties will need to sign up to participate in the proceeding to determine 2026-2030 rates early this year, even though the proceeding is unlikely to be resolved until late 2025 (unless there is an earlier settlement)(the CRB Notice asking for petitions to participate in the proceeding is expected to be published in the Federal Register tomorrow).  Initial stages of the litigation (including the identification of witnesses, the rate proposals, the evidence supporting those proposals, and the initial discovery) will likely take place this year. Continue Reading Gazing into the Crystal Ball at Legal and Policy Issues for Broadcasters in 2024 – Part II: What to Expect from the Courts and Agencies Other than the FCC

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.

  • A bill was introduced in the US Senate proposing to prohibit any FCC or criminal action against a broadcaster who

Last week, the US House of Representatives passed the MORE Act which, if enacted, would take marijuana off the list of Schedule I drugs – those drugs whose possession and distribution is a federal felony, as is the use of the radio waves to promote their use.  As we have warned before (see, for instance, our article here published when an earlier version of this bill passed the House in 2020), because of the laws making the sale of marijuana a federal crime and prohibiting the use of radio waves to promote that sale, broadcast stations should think twice about any marijuana advertising, even in states where it has been legalized.  Thus, the passage of MORE Act through the House should not be taken as a sign to start running marijuana advertising on your broadcast station.

First, it is important to remember that this bill was passed only in the House of Representatives.  Without also being approved by the Senate and being signed by the President, the House’s action had no legal effect.  Because of the way that Congress works, if the bill does not pass the Senate in the current legislative session, which ends in the first few days of January 2023, the whole process must start over again – bills do not carry over from one Congressional session to another.  So, if Senate action is not forthcoming this year, a new Congress would have to start with a new bill, and a new House of Representatives and a new Senate would both have to vote to adopt the legislation.   The MORE Act passed the House with few Republican votes, so if the composition of the House changes next year, that may not bode well for this legislation if it does not pass the Senate this year.
Continue Reading House of Representatives Passes MORE Act to Remove Marijuana from Schedule I – Don’t Rush to Start Airing Pot Ads Yet

Last week, there was much written in the press about the MORE Act passing in the House of Representatives, taking actions to decriminalize marijuana under federal law.  This would include removing marijuana from Schedule I, which is the list of drugs whose use for almost all purposes is prohibited in the United States.  The passage of this bill through the House, though, should not be taken as a sign to start running marijuana advertising on your broadcast station – though there are some signs that the day on which that advertising can be run may be in sight.

First, it is important to remember that this bill passed only in the House of Representatives.  Without also being approved by the Senate and being signed by the President, the House’s action had no legal effect.  Because of the way that Congress works, if the bill does not pass the Senate in the current legislative session, which ends in the first few days of January 2021, the whole process must start over again – bills do not carry over from one Congressional session to another.  So, to become law in the new year, a new Congress would have to start with a new bill, and a new House of Representatives and a new Senate would both have to vote to adopt the legislation.
Continue Reading MORE Act Passes House – But Don’t Rush to Run Marijuana Ads on Your Broadcast Station

In recent months, there have been many calls to regulate e-cigs, and potentially to regulate the marketing of all sorts of vaping products, including a call last week by an FCC Commissioner in an op-ed article in USA Today.  As we wrote several months ago, these suggestions have been based in the fear that increased promotion of vaping products have led to an increase in tobacco use among children.  While the FDA has been taking efforts to crack down on flavored vaping products to reduce their appeal to kids, the makers of e-cigs still advertise, including on radio and TV.  And those advertisements bring us frequent questions about whether the FCC has rules about advertising these products.  So far, the FCC has had no real role in regulating these products.  In fact, one wonders if it really has any authority to take action against the advertising of e-cigs without Congressional action.

So far, all the limits on e-cig advertising have been imposed by other agencies – principally, the FDA.  The FDA requires a tag on all vaping ads, stating that these products contain nicotine, which is an addictive substance (see our articles here and here for more details about that requirement).  And these ads should not claim health benefits for vaping.  Given the FDA’s concern about children, any ads should also stay out of programming with a large audience of children.  Could the FCC itself do more?
Continue Reading A Call to Regulate E-Cig Advertising – What is the FCC’s Role in Regulating Advertising For the Vices?

Last week’s letter from the FDA detailing its position that there should be no change in marijuana being classified as a Schedule I drug under Federal law reinforces the fact that, under Federal law, the drug is still illegal – no matter what certain states may do to legalize or decriminalize its use. As the FDA’s decision emphasizes that the sale and distribution of the drug is still not permitted under Federal law, we thought that we would rerun the advice that we gave to broadcasters – Federal licensees – about running advertising for marijuana. As we said in February when we first ran this article, advertising for marijuana is still a concern.  Here is what we said in February:

Broadcasters, like other federally regulated industries, continue to be leery about advertising for marijuana, even in states where cannabis dispensaries have been legalized for medical or even recreational use.  This week, the NY Times ran an article about companies trying to provide ways for dispensaries to use electronic payment systems, as federally regulated banks and credit card companies often refuse to deal with these businesses.  This is despite guidance given by the Department of Justice to banks about how to handle funds coming from such organizations.  Where the federal regulator (the FCC) has provided no advice whatsoever, broadcasters as regulated entities need to be very restrained in their desires to run ads for these dispensaries that appear to be legal under state laws.
Continue Reading FDA Continues to Schedule Marijuana as a Schedule I Drug – Doing Nothing to Clarify the Still Murky State of Broadcast Advertising

Broadcasters, like other federally regulated industries, continue to be leery about advertising for marijuana, even in states where cannabis dispensaries have been legalized for medical or even recreational use.  This week, the NY Times ran an article about companies trying to provide ways for dispensaries to use electronic payment systems, as federally regulated banks and credit card companies often refuse to deal with these businesses.  This is despite guidance given by the Department of Justice to banks about how to handle funds coming from such organizations.  Where the federal regulator (the FCC) has provided no advice whatsoever, broadcasters as regulated entities need to be very restrained in their desires to run ads for these dispensaries that appear to be legal under state laws.

Broadcasters are of course Federal licensees, and marijuana is still a controlled substance, illegal for sale to the public under Federal law.  While the current administration in Washington has said that enforcing marijuana laws against those who comply with state law is not an enforcement priority, it gave that advice provided a cannabis business observes very strict guidelines.  Strict Federal laws against any sale of marijuana remain on the books, and any search of the DOJ website provides numerous examples of legal actions brought against companies and individuals that don’t fit within those guidelines.  Plus, all it takes is a change in enforcement priorities by the Federal government and even dispensaries that are legal under state law can be closed by Federal actions.  And even if the priorities don’t change, the Department of Justice suggestions to Federal prosecutors don’t stop individual prosecutors from taking actions, especially if the cannabis-related business is found to have violated some other law or if it is acting outside of the strict limits that the DOJ set out in suggesting prosecutorial restraint.  Promoting a business that is not legal under Federal law is dangerous. 
Continue Reading The Murky State of Rules on Broadcast Advertising of Marijuana Products in States Which Have Legalized its Sale or Use

As medical marijuana has become legalized or decriminalized in many states, broadcasters have looked at advertising for the services of clinics and dispensaries as a potential new revenue source. As some community newspapers and other local media have begun to advertise dispensaries in states where medical marijuana is legal, we’ve been asked many times whether broadcasters can start to run such ads as well. Many radio and TV stations have even been approached by the operators of these clinics, seeking to run advertising schedules. Should broadcasters accept such ads? We urge caution.

Even though many states have decriminalized medical marijuana, possession and distribution of marijuana is still a Federal crime.  And broadcasters, unlike most other local media outlets, operate with Federal licenses. While the current US Attorney General has said that he will not criminally prosecute medical marijuana cases, the prohibition against marijuana remains on the books.  A careful reading of the Attorney General’s directive on medical marijuana shows that the Department of Justice has not said that medical marijuana is a legal substance, but only that, as a matter of prosecutorial priorities, the DOJ will not use its resources to target dispensaries and clinics operating under the color of state laws.  So, while this Attorney General may not direct his Department to prosecute medical marijuana users or distributors, the possession of marijuana remains a Federal crime, and the Attorney General’s memo makes clear that state laws cannot change this conclusion.  Thus, there may be some zealous local Federal prosecutor who decides to enforce the law on his or her own. Or, perhaps of more concern to the broadcaster, is the fact that there may be some local citizen in an area served by a radio or television station that runs such an ad who complains about the content of the ad to the FCC. In fact, we understand that there are already such complaints pending at the FCC. Continue Reading Advertising Medical Marijuana on Broadcast Stations – Is It Legal, What Will the FCC Think?