political ad sponsorship

In this “political” year with Congressional mid-term elections in November, including many hotly contested races for seats in the US House of Representatives and the Senate, as well as many state and local elections, I receive many questions from broadcasters across the country. Perhaps the area in which most questions are received deals with the “political file,” particularly because these files are now available online. The fact that this file can now be viewed by anyone anywhere across the country has raised many questions that were perhaps less top of mind when the file was available only by physically visiting the main studio of a broadcast station. So, with the election just over a month away, meaning that the busiest advertising period will be coming up between now and the election, I thought that it would be worth taking a look at some of the online public file issues.

As an initial matter, it is worth mentioning that the political file has two main purposes. First, it is designed to provide information to the public about who is trying to convince them to vote in a certain way or to take action on other political issues that may be facing their country or community. Second, the file is to inform one candidate of what uses of broadcast stations his or her opponents are making. Thus, the documents placed in the file must be kept in the file for only two years from the date that they were created – perhaps on the assumption that at that point, we will be on to the next election cycle and old documents really won’t matter to the public or to competing candidates in the last election. But what needs to go into the file?
Continue Reading Beware of the Political File Obligations in this Hot Political Advertising Year

Public interest groups are actively watching broadcast political advertising which could make this a very interesting year for broadcasters.  The Sunlight Foundation, which only two months ago filed complaints against 11 television stations for alleged inadequacies in their online political files (see our summary here), has now filed two new complaints alleging that television stations violated FCC rules in recent elections by not identifying the true sponsor of political ads.  In each complaint, Sunlight alleged that ads were tagged as having been sponsored by Political Action Committees, but in each case the true sponsor who should have been identified was the wealthy individual who had contributed all of the funds to the PAC.  Sunlight’s press release about the complaints is available here, and contains links to the complaints themselves.  Is this complaint valid?

The complaint focuses on the language in Section 317 of the Communications Act which requires that when a station broadcasts any content and “consideration is directly or indirectly paid, or promised to or charged or accepted by, the station so broadcasting, from any person,” that person must be identified.  While it seems clear from FCC precedent that person does not mean individual person, as corporations or other legal entities can certainly be sponsors, the compliant submits that this situation is different.  Why?  Because, the petitioners argue, the PACs involved in these cases (one supporting a Republican candidate, the other supporting a Democrat) were effectively each an alter ego for a single individual who provided all the funds for the PAC.  But how is the TV station supposed to know?
Continue Reading FCC Complaints Filed Against TV Stations for Not Identifying the True Sponsor of Political Ads

In recent days we have seen political action committees (PACs) claiming they are "prohibited" from running political ads in primary states due to "new rules" regarding "electioneering communications."  As explained below, these claims are incorrect.  What they are really doing is trying to avoid the need to reveal the identity of their contributors, following a US District Court decision in March.

Under Federal Election law, an "electioneering communication" is a broadcast, cable or satellite communication that refers to a clearly identified candidate for federal office within 30 days of a primary or 60 days of an election, targeted to 50,000 or more people in the state or district the candidate seeks to represent. For President and Vice Presidential candidates, an "electioneering communication" is one that can be received by 50,000 or more people within 30 days of a state primary or the nominating convention.

By federal statute, sponsors of "electioneering communications" must disclose the names and addresses of each donor who contributed $1000 or more to the sponsoring organization. This is is the provision that led to the US District Court decision at issue.


Continue Reading Some PACs Stop Running “Electioneering Communication” Ads to Avoid Reporting Requirements

Failing to meet the obligations set out under the law for required sponsorship identification on Federal political ads could, theoretically, cost candidates significant amounts of money – if stations decide to hold the candidates to the letter of the law. Under the terms of the Bipartisan Campaign Reform Act (“BCRA”), Federal candidates airing television commercials that refer to a competing candidate must specifically state, in the candidate’s own voice, that he or she has approved the ad, while a full-screen image of the candidate appears on the screen. In addition, the name of the sponsoring candidate’s campaign committee must appear in text on the screen for at least 4 seconds at 4 percent of screen height, with sufficient color contrast to make the text readable. If the proper identification is not contained in an ad, the candidates forfeit their right to lowest unit rates for the entire pre-election period (45 days before a primary or 60 days before an election), even with respect to future ads that comply with the rules. In recent days, representatives of Democratic Congressional candidates have reportedly filed complaints that argue that Republican competitors have not complied with the rules in several cases, as their written disclosures did not air for the full four seconds. The challengers argue that television stations must take away LUR for these candidates. While the statute say that the candidates forfeit their rights to such rates, the law is unclear as to whether stations are obligated to deny that rate to candidates after the right has been forfeited – and these cases could resolve this issue.

Television stations undeniably have the power to charge full rates to candidates whose ads have not complied with the requirements of the campaign statute. However, many stations have been reluctant to do so for minor infractions such as the ones identified in this complaint. Why wouldn’t television stations want to charge more money? For several reasons. First, denying one candidate lowest unit rates will no doubt trigger a fly-specking of every commercial by the competitor who filed the complaint against the first candidate, to try to trigger a forfeiture of the second candidate’s right to Lowest Unit Rates, and adjudicating such complaints will no doubt make the station’s political sales process much more difficult and costly to administer. In addition, there is the question of whether, for a minor violation, a station really wants to give the other candidate a political advantage – especially if the candidate who gets charged more more wins the election and gets to vote on laws that may effect business in the future. But can stations legally continue to charge the lowest unit rate even when a candidate has not complied with the legal requirements for sponsorship identification?


Continue Reading What Happens if a Federal Candidate’s Commercial Does Not Have Proper Sponsorship Disclosure?