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
With February 17 only two days away – when all television stations had planned to be terminating their analog service until Congress passed the extension of the conversion deadline until June 12 – many stations are still planning to convert to fully digital operations on that date. In the last few days, we have seen a flurry of FCC orders about the conversion – including one issued late Friday night modifying requirements that had previously been announced, including the requirement that stations providing analog nightlight service provide emergency information in Spanish. As stations complained that they did not have the ability to translate their emergency information into Spanish, the FCC dropped the requirement (though still requiring information about the DTV transition to be broadcast in English and Spanish, probably assuming that Spanish-language PSAs providing the necessary information can be obtained from the NAB or other broadcast groups). That order also officially extended all digital construction permits that would have otherwise expired on February 17, and extended the conditions that are on many of the permits prohibiting digital operations on their final digital channels until the new transition deadline – unless these stations get explicit permission from the FCC to transition early by showing that they will not cause any interference to other stations when they operate on their new digital channels.
The Commission also has been publishing lists of the stations that had intended to go all-digital by February 17 despite the extension. First, the Commission released a Public Notice of all stations that had initially indicated that they would go silent, with a market-by-market analysis of which stations would go all-digital on February 17 (marked in red) and which would continue in analog. After analyzing that list, the Commission issued another Public Notice, with a list of stations that could not go all-digital without submitting certifications that they would meet certain consumer education requirements after the transition – including having at least one commercial station in a market continuing to broadcast a nightlight service that not only included information about the digital transition, but also news and emergency information, for at least 60 days. the certifications also required having a local call center for those who have questions about the transition, having a walk-in center where people can come for assistance with their digital converters, and otherwise taking steps to publicize the transition. Stations either needed to make these certifications, provide another public interest reason why they had to terminate analog operations on February 17, or agree to continue their analog operations.
In two races for the US Senate, candidates have filed defamation lawsuits against their opponents charging that attack ads go over the line from political argument to actionable falsehoods. However these suits ultimately play out, they demonstrate the premise that we’ve written about before, that broadcast stations are prohibited by FCC rules and the Communications Act from censoring the content of a candidate’s ad, and because they cannot censor the content of a candidate’s ad (or refuse to run a candidate’s ad because of the content of that ad), stations are immune from liability that might otherwise arise from that content. But the candidates being attacked can sue their opponents for the contents of those ads, and that is just what has happened in the North Carolina and Minnesota Senate races.
In North Carolina, according to press reports, Democratic candidate Kay Hagan has filed suit against the campaign of Elizabeth Dole for a commercial that accused Hagan of being associated with a group called Godless Americans – an ad ending with a woman’s voice that some interpreted as being that of Hagan (when it was in fact not) saying "there is no God." In Minnesota, Senator Norm Coleman has reportedly filed a lawsuit against Al Franken’s campaign claiming that Franken campaign ads improperly claimed that Coleman was rated one of the four most corrupt Senators and that he was getting an improperly financed apartment in Washington DC.
In the FCC’s recent Report and Order on Diversity, released earlier this year, the Commission announced new requirements for all broadcast station’s advertising sales contracts. The new FCC rule requires that all advertising contracts contain clauses ensuring that there is no discrimination based on race or gender in the sale of advertising time. This new requirement, which took effect in July, not only requires broadcasters to have these non-discrimination clauses in their advertising sales contracts, but will also require that broadcasters certify as to the existence of such clauses in their next license renewal application. Thus, to be sure that you can make such certifications, you must revise your advertising contracts to include a nondiscrimination provision, such as the one set out below, if you have not done so already.
These new measures are intended to increase participation in the broadcast industry by businesses owned by women and minorities. The Commission was concerned that some advertising contracts include either explicit or implicit “no urban/no Spanish” dictates. Such contractual limitations, the Commission explained, may violate U.S. anti-discrimination laws by either presuming that certain minority groups cannot be persuaded to buy the advertiser’s product or service, or worse, intentionally minimizing the number African Americans or Hispanics patronizing advertisers’ businesses.
As we enter the waning days of this election season, where some candidates get more desperate and the attack ads get sharper, broadcasters are often faced with requests that they pull an ad created by a candidate. Claims are made that the ad contains untrue claims about an opponent or that the ad contains copyrighted material used without permission. What is a station to do? When the ad is an ad purchased by a candidate or their authorized committee, and contains a "use" by the purchasing candidate (a use being a spot where the purchasing candidate’s voice or likeliness appears on the spot) the broadcaster is forbidden from censoring that ad. Essentially, that means that the candidate can say just about anything in their ad (as long as it does not violate a Federal felony statute), and the FCC’s rules prohibit the broadcaster from refusing to air the ad based on its content. But, because the station cannot censor the ad, it has no liability for the contents of that ad. This is in contrast to ads by third parties (e.g. advocacy groups, unions, political parties and others not specifically authorized by the candidate), where the broadcaster theoretically has liability for the content of a political ad (see our post on that subject, here).
Two recent cases illustrate the issue. In one, according to press reports, in a race for the sole seat in the House of Representatives representing the state of North Dakota, one candidate has claimed that the ads of the other misrepresent the positions of that candidate. The candidate being attacked has asked that the spots be pulled from the air, while the candidate running the spots has refused to pull them. Even if requested by the candidate being attacked, and even if the ad is in fact false, broadcasters cannot pull one candidate’s ad if that candidate wants to continue to run it.
UPDATE 5-29-2008- Please note, the Commission has revised the dates for submitting comments in this rule making proceeding. Comments in the proceeding are now due on or before June 30, 2008, and Reply Comments are due on or before July 14, 2008. This means that interested parties have a couple of weeks less than…
At its December meeting, at the same time as it adopted rules relaxing the newspaper-broadcast cross-ownership rules, the FCC adopted new rules to expand diversity in the ownership of broadcast stations, encouraging new entrants into such ownership. The full text of that decision was just released last week, providing a number of specific rule changes adopted to promote diverse ownership, as well as a number of proposals for changes on which it requests further comment. Comments on the proposed changes will be due 30 days after this order is published in the Federal Register. As this proceeding involves extensive changes and proposals, we will cover it in two parts. This post will focus on the rule changes that have already been made – a subsequent post will cover the proposed changes. The new rules deal not only with ownership rule modifications, but also with issues of discrimination in the sale of broadcast stations and in the sale of advertising on broadcast stations, new rules that leave some important unanswered questions.
The rules that the Commission adopted were for the benefit of "designated entities." Essentially, to avoid constitutional issues of preferences based on race or gender, the definition of a designated entity adopted by the Commission is based on the size of the business, and not the characteristics of the owners. A small business is one designated as such by the Small Business Administration classification system. Essentially, a radio business is small if it had less than $6.5 million in revenue in the preceding year. A television company is small if it had less than $13 million in revenues. These tests take into account not only the revenue of the particular entity, but also entities that are under common control, and those of parent companies. For FCC purposes, investment by larger companies in the proposed FCC licensee is permissible as long as the designated entity is in voting control of the proposed FCC licensee and meets one of three tests as to equity ownership: (1) the designated entity holds at least 30% of the equity of the proposed licensee, or (2) it holds at least 15% of the equity and no other person or entity holds more than 25%, or (3) in a public company, regardless of the equity ownership, the designated entity must be in voting control of the company.
As the dates for the first Presidential primaries draw near, more and more stories appear in the press about attack ads growing in importance. These ads are coming both from the candidates themselves trying to draw distinctions with their opponents, and from third party, supposedly independent, groups either attacking or supporting one of the candidates. See, for instance, the recent story in the Washington Post on the increase in third party ads. These ads have raised political issues on the campaign trail as to whether negative campaigns work, and as to how independent of the candidates the third party expenditures really are. They also raise legal issues for broadcasters. Whenever there are attack ads that are run on a broadcast station, there are complaints from the candidate being attacked about how unfair the criticism is. Broadcasters have to deal with these complaints, and the sponsor of the ads makes a huge difference in the broadcaster’s responsibilities to check the truth of the statements made. As we explain in our Political Broadcasting Guide, broadcasters may not censor the content of a candidate ad, and thus are exempt from any liability for the content of that ad. But attacks contained in third party ads may require the broadcaster to do some investigation into the claims being made to make sure that they avoid legal liabilities.
For ads run by a candidate or his or her authorized committee, the Communications Act forbids a broadcaster (or cable company that chooses to sell time to political candidates) from censoring the candidate’s message. Because of the no censorship rule, the Courts have ruled that broadcasters are immune from any sort of liability for defamation that may arise from the content of the ad. Thus, broadcasters cannot reject a candidate’s message based on its content (with the possible exception of cases where that content would violate a criminal law, as opposed to just creating some civil liability), and need not take any action in response to a complaint by an opposing candidate that the ad contains incorrect or distorted information.