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.