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Last week, we wrote about the new requirement for a nondiscrimination clause in all broadcast advertising contracts.  In the new license renewal applications, broadcasters must certify that they do not discriminate in the sale of advertising time and that their contracts contain the required certification.  Today, the Enforcement Bureau of the FCC issued an Enforcement Advisory, answering questions about the new requirement.  Unfortunately, that advisory really does little but reiterate what the FCC has already said – that the Commission is concerned about "No Urban, no Spanish dictates", and that broadcasters must make sure that there is no discrimination in the purchase of advertising time on their stations.  But, the Commission does make clear in an accompanying News Release, through a statement from Chairman Genachowski, that the Commission "will vigorously enforce its rules against discrimination in advertising sales contracts."  The advisory does highlight one new matter – that stations that use advertising rep firms or other sales agents must make sure that these agents have nondiscrimination clauses in their own contracts used to sell advertising time on the station. 

This policy has raised several questions from broadcasters.  Many have asked what they should do if they have no advertising contracts.  Apparently, many broadcasters, especially in smaller markets or when dealing with regular customers, book advertising through emails or phone calls – not formal contracts.  The FCC does not address how this should be handled.  We’ve suggested that broadcasters include the nondiscrimination clause in the exchanges that essentially form the contract – e.g. the email confirming the schedule, the rate cards offering the spots for sale, or other communications between the station and the advertiser.  We also suggest that stations adopt written contracts, as these contracts can cover issues that are important to broadcasters, e.g. indemnifications from advertisers that they have the rights to all the music and other material used in their ads, statements that the broadcaster reserves the right to preempt ads if they don’t like the content or if the broadcaster needs to run something more important, that advertising sold to one party should not be re-sold to anyone else, that the broadcaster is not liable for any consequential damages if an ad does not run for technical or other reasons, and similar issues.Continue Reading FCC Issues Advisory on Nondiscrimination Clause Required to Be Included in All Broadcast Advertising Contracts – What Should the Clause Say? – Why An Advertising Contract is Important

The nuts and bolts of legal issues for broadcasters were highlighted in two sessions in which I participated at last week’s joint convention of the Oregon and Washington State Broadcasters Associations, held in Stephenson, Washington, on the Columbia River that divides the two states.  Initially, I conducted a seminar for broadcasters providing a refresher on their…

In 2008, the FCC adopted a requirement that broadcast stations include in their advertising contracts a provision that says that advertisers will not discriminate on the basis of race or gender.  We wrote about that requirement here, and our post was greeted with significant surprise by many broadcasters as the requirement did not glean much publicity when it was first adopted.  Today, the FCC issued an Erratum to that two year old requirement, eliminating from the certification its application to discrimination in advertising based on gender.  Instead, the Erratum stated it was only discrimination based on race or ethnicity that was prohibited.  The Erratum stated that this language "more accurately" reflected the "Commission’s clear intent" in adopting the requirement for the certification in advertising contracts.

The removal of "gender" from the advertising discrimination certification seems to recognize the common-sense advertising principal that some advertising, by its very nature, may be targeted to one gender or another.  But the correction of this language through an Erratum seems to avoid many of the hard issues that remain with this certification.  The Commission was very terse in its explanation of how this certification was supposed to work and exactly what it was supposed to prevent.  There were certain situations that seem to fit within the prohibitions – situations where the advertiser of a general market product refuses to allow it to be advertised on stations that target minority audiences (see our discussion of the Mini Cooper advertising controversy here).  This was to avoid the "no Spanish, no urban dictates", ruling out advertising on stations with urban formats or those programmed in Spanish, that some felt were attached to some advertising orders.  But there are many other questions that remain to be clarified.Continue Reading FCC Corrects Advertising Nondiscrimination Certification – Removes Gender From Certification

A request for advertising rates by an ad agency representing the Mini Cooper serves as a reminder to broadcasters of the recently-imposed obligation to insure that broadcast advertisers do not discriminate on the basis of race or gender.  As we wrote several months ago, the FCC has adopted a new requirement that a broadcaster certify at license renewal time that their advertising contracts require advertisers certify that they were not making advertising decisions based on the race or gender of the audience of the broadcast station.  This was to eliminate the "no urban/no Spanish" dictates that many felt were a discriminatory part of the advertising landscape.  As demonstrated by the controversy that erupted when this request for rates was circulated, stations need to insure that their contracts contain language prohibiting discrimination in advertising buys, as any such dictates will not be a secret.  And once they get out, if a station has run a campaign purchased by an advertiser who had included such dictates, the station running the campaign may have difficulty in making the required certification as the station knows that the actions of the advertiser contradict any certifications that the advertiser may have made in signing the station advertising contract containing the required certifications.

Our earlier post on the issue suggested some language to include in an advertising contract disclaimer, and also discussed the issue of the positive use of racial or gender advertising specifications for ads targeting minority and gender specific audiences.  But the issue in the Mini Cooper case makes clear that many in the advertising community, and probably many in the media community, do not know about the adoption of the FCC’s policy, or the proposal to extend the policy to cable advertising.  It is also interesting to note that the FCC has refused to provide more specific guidance on this rule, not even specifying the language that should be used in contracts.  Nor has the new license renewal form containing the required certification that the broadcaster must make about his compliance with this rule been released, making it unclear if this form has even passed review by the Office of Management and Budget under the Paperwork Reduction Act. Continue Reading Mini Cooper Ad Request Reminds Broadcasters of No Urban Dictate Certification