Law Blog Articles
The following articles were recently posted on the Davis Wright Tremaine LLP Broadcast Law Blog. If you would like more details on any of these topics, click on the link below. The full article also contains any links to additional materials. You can subscribe to the Broadcast Law Blog and get information immediately when it is posted by signing up on the blog page: www.broadcastlawblog.com.
May 3, 2009
Selling Stories In a Broadcast Station's News Programs - Remember the Sponsorship Identification
A recent stir was created when a Midwestern television company was reported to have signed a contract with a state government agency, promising to market the agency and its programs throughout the state. This promotion was to include a segment in the company's televised news promoting the effects of the work of the agency. Questions were immediately raised about whether this was prohibited by FCC rules. But, when the news pieces ran, the company was very careful to state after these segments that they were sponsored by the station and the state agency. As the FCC has no rules about what can be included in the "news" (and probably could not consistent with the First Amendment), the only real issue was one of sponsorship identification. As the licensee did here, if the sponsor of the story is identified, making clear to the public who was attempting to persuade them on the issue addressed, there should be no FCC issues. Continue
reading...
May 3, 2009
Remember FCC Public File Obligations When Running Issue Advertising
We’re not even in what most would consider election season - except for the two states with off-year governor’s contests and those other states with various state and municipal elections. Yet political ads are running on broadcast stations across the country. Republican groups have announced plans to run ads attacking certain
Democratic Congressmen who are perceived as vulnerable, while certain Democratic interest groups have run ads about the positions of Republicans on the Obama stimulus package and the President’s proposed budget. In addition to these ads targeting specific potential candidates, there are issue ads running across the country on various issues pending before Congress, or likely to be considered by Congress in the near term. These ads often have a tag line “write or call your Congressman and tell him to vote No” on whatever bill is being discussed. While
these are not ads for political candidates that require lowest unit rates or specific equal opportunities, they do give rise to political file issues. Stations need to remember to observe these requirements and put the required information into their public file to avoid FCC issues.
Continue reading... 
April 30, 2009
FCC Gives No Special Consideration to Noncommercial Broadcasters Who Violate the Rules - Colleges Pay Attention to Your Radio Station!
In a decision fining a noncommercial radio station $7200 for failure to have several years' worth of quarterly issues programs lists in its public inspection file, the FCC specifically stated that it does not have a reduced scale for fines for noncommercial broadcasters. Instead, noncommercial station licensees, like the college that was involved in this case, have to justify a reduction in the amount of a fine based on financial hardship by providing a financial statement for the licensee itself - not just a showing of the budget for the radio station. Thus, a college or university station that is in violation of an FCC rule, and which is issued a Notice of Apparent Liability, cannot justify a reduction in the fine merely by saying that the station cannot afford the fine -
they will have to show that the institution itself is unable to pay the fine that the FCC imposes. Continue reading...
In a decision released today, the US Supreme Court upheld the FCC determination that fleeting expletives in the televised broadcasts of the Golden Globes and Billboard Music Awards violated the FCC's indecency rules. In this case, called Federal Communications Commission v. Fox Television Stations, Inc., the Supreme Court overturned the decision of the Second Circuit Court of Appeals, which had found the FCC decision to be arbitrary and capricious. The Supreme Court, in a 5-4 decision, determined that the FCC had adequately justified its departure from prior decisions in determining that it could sanction a station for a single "F-word" or "S-word" broadcast on that station outside of the 10 PM to 6 AM safe harbor. However, the Supreme Court specifically declined to rule on the constitutionality of the indecency finding, as the Second Circuit had not made its decision on that ground. The Supreme Court sent the case back to the Second Circuit for further consideration, recognizing that the constitutional issues with the FCC's enforcement policy might well be back before it again, "perhaps in this very case." Continue reading...
April 28, 2009
Reminder: New FCC Application Fees Go Into Effect Today
Last month, we warned readers that the FCC application fees were going up. And today is the day that the new fees take effect. So, if you are planning an FCC filing today or at any time in the future, remember to pay those higher fees - or face the risk of having your application bounced by the FCC for insufficient payments. Continue reading...
We recently wrote about the agreements between SoundExchange and various groups of webcasters, which became effective under the terms of the Webcasters Settlement Act. These rates act as a substitute for the rates set by the 2007 Copyright Royalty Board decision setting Internet radio royalties for the use of sound recordings in the period from 2006-2010. The deal with broadcasters set lower rates than the CRB for 2009 and 2010, and also waived certain requirements otherwise applicable to webcasters, limiting the number of songs from the same artist that can be played in a given period of time (see our posts here and here). There is also a deal that SoundExchange unilaterally advanced to certain small webcasters which allows for a percentage of revenue royalty, but limits the amount of listening to these webcasters allowed at these rates, and imposes significant recapture fees if a webcaster sells its service to another company that would not qualify as a small webcaster (see our post here). April 30 is an important date under both deals, as it is the date by which small webcasters must elect the deal, and the date by which all broadcasters who elected the broadcaster deal earlier this month are to pay any back royalties which they owe for streaming from 2006 through the date of the agreement. Continue reading...
April 26, 2009
FCC Proposes to Encourage Rural Radio By Making it More Difficult to Move Radio Stations to Urban Areas
Rural communities – do their radio stations need government protection? The FCC seems to think so, proposing a series of new rules and policies that restrict the ability of the owners of rural radio stations to move their stations into urban areas. These rules would make it harder for entrepreneurs to do “move in” applications – taking stations from less populated areas and moving them to communities where they can serve larger populations in nearby cities. The Commission states that it is making these proposals to attempt to live up to its obligations under Section 307(b) of the Communications Act to ensure a “fair, efficient and equitable” distribution of radio services to the various states and communities in the country. While this may be a noble goal, one wonders if it is a solution in search of a problem. Are there really rural communities that have an unmet demand for missing radio services – and which can economically support such services? And
do these proposals conflict with other goals of the new Commission, by effectively decreasing the opportunities for minorities and other new entrants from acquiring stations in major markets – by taking away move-in stations that are often the only stations that these broadcast station owners can afford in urban markets? These are questions that the FCC will need to resolve as part of this proceeding. Continue reading...
April 19, 2009
Another FCC Fine For Not Following Contest Rules
- Disclose Any Benefits that Loyal Listeners May Get
Last week, the FCC fined yet another broadcaster for violations of its contest rules, issuing a fine of $4,000 to a station that had not disclosed to its listeners all of the material terms of a contest that it conducted on the air. In this case, the station promised a give-away of three cars, but in reality it was only awarding to winners a two-year lease for the cars, not actual ownership of the vehicles. This is another in a series of recent fines for contests, so stations should be aware of the attention that the FCC is giving these issues. And this case should again remind broadcasters that they must disclose any practices that may affect the odds of winning of potential contestants - including any benefits that certain listeners, like members of loyal listeners clubs, might get that would improve their chances of winning a contest (see our post here on the Commission's discussion of what are the material terms of a contest). Continue reading...
April 18, 2009
Rules for September Auction for New FM Stations
Set - Application Filing Deadline Is
June 25
The dates and minimum bids are set – and the next auction for new FM stations is a go for September 1, 2009. Applications to participate in the auction are due during the period June 16 to June 25, and must be filed electronically at the FCC, specifying on which of the 122 available channels an applicant is interested in bidding. Full, detailed auction instructions can be found in the FCC’s Public Notice, and the list of available channels and the minimum bids for each is available here. To give time for applicants to prepare their applications, the Commission has also initiated a variety of freezes on the filing of certain FM applications. Continue reading...
April 8, 2009
FCC to Require New Ownership Reports from all Commerical Broadcasters on November 1
At its meeting today, the FCC decided to revamp its Ownership Report filing process - requiring all stations to file Biennial Ownership Reports on FCC Form 323 on November 1 of this year - even stations that have just filed those reports in the normal course in the last few months. All stations will have to file every two years thereafter - on November 1 of every other year. Reports will also be required from Low Power TV stations and Class A TV stations, which have not in the past had to file reports. Reports will also be required from stations that are owned by an individual, and by general partnerships in which all of the partners are individuals (or, in the FCC's legalese, "natural persons"). In the past, such stations did not have to file reports as any change in ownership would have required, at a minimum, the filing of a Form 316 short-form assignment or transfer application. Finally, the Commission will require the reporting of the
interests of currently non-attributable owners who are not attributable simply because there is a single majority shareholder in the licensee. Continue reading...
April 8, 2009
Copyright Royalty Board Asks for Further Comments
on Costs of Census Recordkeeping for Internet Radio Services
In January, the Copyright
Royalty Board asked for comments as to whether it should require
"census reporting" of all sound recordings that are used by a digital service subject to the statutory royalty. This would replace the current requirement that services need only report on the sound recordings used for two weeks every calendar quarter. Most of the comments that were filed dealt with the difficulties of certain classes of webcasters - particularly small webcasters and certain broadcasters - in keeping full census reports of every song that is played by a service, and how many people heard each song. In a Notice of Inquiry published in the Federal Register today, the CRB asked for further information about the cost and difficulties of such reporting. Comments on the Notice are due on May 26, 2009, and replies on June 8. Continue reading...
April 7, 2009
FCC Clarifies Rules on Extension of Broadcast
Construction Permits Upon Sale to Qualified Entity
As part of its order in it proceeding to encourage diversity in broadcast ownership, the FCC adopted a number of new rules, including a rule allowing parties holding construction permits for new broadcast stations to sell those permits to "qualified entities." The buying qualified entity would then then get 18 months to construct the new station, even if the construction permit would otherwise expire in less than 18 months. Under prior policy, an FCC construction permit would expire 3 years after it is issued, with no real opportunity for extension (though the construction period could be "tolled" for the period that certain impediments to construction existed, i.e. litigation over zoning, FCC litigation over the validity of the permit, or Acts of God that temporarily stopped construction - but only for the limited period that such an impediment existed). The new rule was adopted to encourage the sale to new entrants to broadcast ownership who could purchase construction permits that might otherwise expire. Today, the FCC issued some clarifications of the new rule. Continue reading...
April 5, 2009
When are a Bunch of Towers Really a Tower Farm - Only the FCC Knows for Sure
A recent FCC decision shows how important it is for an applicant for a construction permit for a new or modified broadcast station, which entails the construction of a new tower, to take all steps set out on the the environmental worksheets associated with FCC Form 301 before certifying that the tower will not create environmental issues. In the recent case, the FCC did not find that any actual environmental issues existed with the applicant's proposed construction of a new tower, but it nevertheless stated that it would have fined the applicant for a false certification if the statute of limitations for the fine had not passed. Why? Simply because the applicant had not touched all of the required bases before making its certification that the tower construction posed no threat to the environment. The applicant had tried to argue that no environmental study was necessary as the site was a de facto tower farm given that there were already two towers nearby, but that claim was rejected by the FCC, finding that nearby towers do not necessarily constitute a tower farm.
Continue reading...
April 4, 2009
Congressman Boucher to NAB - Accept Performance
Royalty - How Much Would It Cost?
The week, Congressman Rick Boucher, a member of both the House of Representatives Commerce and Judiciary Committees, told an audience of broadcasters at the NAB Leadership Conference that they should accept that there will be a performance royalty for sound recordings used in their over-the-air programming and negotiate with the record companies about the amount of a such a royalty. He suggested that broadcasters
negotiate a deal on over-the-air royalties, and get a discount on Internet radio royalties. Sound recordings are the recordings by a particular recording artist of a particular song. These royalties would be in addition to the payments to the composers of the music that are already made by broadcasters through the royalties collected by ASCAP, BMI and SESAC. Congressman Boucher heads the Commerce Committee subcommittee in charge of broadcast regulation, and he has been sympathetic to the concerns of Internet radio operators who have complained about the high royalty rates for the use of sound recordings. Having the Congressman acknowledge that broadcasters needed to cut a deal demonstrated how seriously this issue is really being considered on Capitol Hill. Continue reading...
April 3, 2009
NPR to Conduct Study of Interference Issues from
Increased HD Radio Power
NPR Labs has announced that it is going to conduct a further study, financed by the Corporation for Public Broadcasting, of the potential of interference from a proposed increase in the power of HD Radio operations. Last year, NPR had raised issues with the proposal by Ibiquity and a number of commercial broadcasters for power increases in the digital radio operations of FM radio stations. At the end of last year, the FCC asked for comments on the proposal for increased HD radio power, and on NPR's concerns about the power increase. As set forth in this week's NPR press release, the new study will be conducted in conjunction with other broadcasters in an attempt to arrive at a way to increase HD radio power without creating undue interference to the analog operations of existing stations. Continue reading...
April 1, 2009
Noncommercial FM and the Disappearing Channel 6
TV Station - the FCC Clarifies the Relationship
The FCC today issued a long-awaited public notice, clarifying the relationship between FM educational stations and the analog Channel 6 TV stations that have or will be disappearing after the digital transition. As we've written before, the question of whether noncommercial FM stations could seek improvements in their facilities based on the imminent disappearance of the Channel 6 stations has been pending for quite some time. In the Public Notice issued today, the FCC made clear that no application for an improvement in a noncommercial FM station will be accepted before the DTV deadline unless it provides full protection to analog Channel 6 stations. Even after the transition, applications will only be accepted after procedures are established in another public notice to be issued by the FCC at some later date. Applications that are currently pending which don't comply with the current rules that require educational stations to protect Channel 6 TV operations (either protecting them from interference or having unequivocal consent from the TV station to the construction at any time of the FM station not conditioned on the digital transition) will be dismissed. Continue reading...
March 29, 2009
With April 2 Webcasting Election Due for Broadcasters - A Look at the Record Label Waivers of the Performance Complement
As we have written, by April 2, broadcasters who are streaming need to file with SoundExchange a written election in order to take advantage of the SoundExchange-NAB settlement. For broadcasters who make the election, the settlement agreement will set Internet radio royalty rates through 2015. One aspect of this agreement that has not received much attention is the waiver from the major record labels of certain aspects of the performance complement that dictates how webcasters can use music and remain within the limits of the statutory license. When Section 114 of the Copyright Act, the section that created the performance royalty in sound recordings, was first written in the 1990s, there were limits placed on the number of songs from the same CD that could be played in a row, or within a three hour period, as well as limits on the pre-announcing of when songs were played. These limits were placed seemingly to make it more difficult for listeners to copy songs, or for Internet radio stations to become a substitute for music sales. In conjunction with the NAB-SoundExchange settlement, certain aspects of these rules were waived by the four major record labels and by A2IM, the association representing most of the major independent labels. These waivers which, for antitrust reasons, were entered into with each label independently, have not been published in the Federal Register or elsewhere. But I have had the opportunity to review these agreements and, as broadcasters will get the benefit of the agreements, I can provide some information about the provisions of those agreements. Continue reading...
March 28, 2009
SoundExchange "Settlement" With Microcasters - A Royalty Option for the Very Small Webcaster
With all the recent discussion of the NAB-SoundExchange settlement (see our post here) and the recent Court of Appeals argument on Copyright Royalty Board decision on Internet Radio royalties, we have not summarized the "settlement" that SoundExchange agreed to with a few very small webcasters. That agreement would essentially extend through 2015 the terms that SoundExchange unilaterally offered to small webcasters in 2007, and make these terms a "statutory" rate that would be binding on all copyright holders. The deal comes with caveats - that an entity accepting the offer would be prevented from continuing in any appeal of the 2006-2010 royalties and from assisting anyone who is challenging the rates in the CRB proceeding for rates for 2011-2015, even if the webcaster grows out of the rates and terms that SoundExchange proposes. Once it signs the deal, it cannot have any role before the court or CRB in trying to shape the rates that his or her company would be subject to once they are no longer a small webcaster until after 2015. Even with these caveats, the deal does provide the very small webcaster the right to pay royalties based on a percentage of their revenue, and even provides some recordkeeping relief to "microcasters", the smallest of the small webcasters. Parties currently streaming and interested in taking this deal must elect it by April 30 by submitting to SoundExchange forms available on its website for "small webcasters" (here) and "microcasters" (here). Continue reading...
March 26, 2009
FCC to Revisit Newspaper-Broadcast Cross
Ownership Restrictions - Maybe the Rule Will Die Before the Newspaper Does
A few weeks ago, we wrote about just how outmoded the FCC's prohibitions on the cross ownership of newspapers and broadcast stations were in an era when newspapers seem to be going out of business at an alarming rate. We quoted a DC trade press reporter who had mused that the newspaper-broadcast cross-ownership rule could well outlast the newspaper itself. According to a report in Bloomberg News today, the Commission may well be revisiting the issue, according to statements made by Chairman Copps, in light of the economic turmoil in the newspaper industry. But what would a review of the issue bring from the FCC? That is unclear from the article - and unclear from the prior statements of the Acting Chairman. Continue reading...
March 26, 2009
Beware of the Open Mike - Off-Air Comments that End Up On the Air Can Lead to Indecency Issues
According to a recent article from the Des Moines Register, a station in Iowa recently fired two employees who, during what they thought was a break in programming, got into a heated, profanity-laden exchange which, luck would have it, ended up on the air as their mikes were live. Fearing an FCC fine, the station owner fired the duo, hoping to mitigate any fine that the FCC might impose. We will have to wait to see what impact the employer's action will have on any action the FCC might take. But the action demonstrates two things - first, mistakes happen and will happen whenever there is live programming. Even
clear station policies that absolutely ban such actions and make clear that they are a firing offense (as were apparently in place here) can't stop human beings from messing up. Second, the case reminds all on-air employees that they need to respect a microphone, and need to assume that a mike that can pick up sounds is in fact doing so. Even Presidents seem to have had problems remembering that fact, but these live-mike slip ups can lead to FCC indecency fines. Continue reading...
In the last 5 days, the US Court of Appeals in Washington, DC has held two oral arguments on appeals from decisions of the Copyright Royalty Board - one from the Board's decision on Internet Radio Royalties and the other on the royalties applicable to satellite radio. The decisions were different in that, in the Internet Radio decision, the appellants (including the group known as the "Small Commercial Webcasters" that I represented in the case) challenged the Board's decision, arguing that the rates that were arrived at were too high. In contrast, at the second argument, SoundExchange was the appellant, arguing that the Board's decision set royalties for satellite radio that were too low. But, in both arguments, an overriding question was whether the Judges on the CRB were constitutionally appointed and thus whether any decisions of the Board had any validity. While the question was expected and specifically raised in the webcasting proceeding (see our post here when that issue was first raised), the discussion at the satellite radio argument was somewhat of a surprise, as the issue had not been raised by either party, and the Appeals Court judges were not even the same judges who had heard the Internet radio argument. Yet one of the Judges raised the issue, unprompted by any party, by asking if the Copyright Royalty Judges were properly appointed and indirectly asking if their decision would have any validity if the constitutional issue was found to exist. Continue reading...
March 24, 2009
FCC Launches New Round of EEO Audits - Highlights the Requirement for Posting Annual Report on Station's Website
The FCC today released another Public Notice announcing the random audit of the EEO performance of a number of broadcast stations - listing both radio and television stations that have to respond, with stations spread throughout the country. The FCC has promised to annually audit 5% of all broadcast licensees to assess their compliance with the FCC's EEO rules. These rules require the wide dissemination of information about job openings at their stations and "supplemental efforts" to educate their communities about employment opportunities at broadcast stations, even in the absence of employment openings. The FCC's audit letter requires the submission of two years worth of the Annual Public File reports that stations prepare each year on the anniversary date of the filing of their license renewal applications. These reports are placed in the station's public file and posted on their websites (if they have websites). The FCC's public notice about this audit emphasizes the requirement for posting the Annual Report on a station's website, perhaps confirming rumors that we have heard about the FCC's staffers browsing station websites to look for these reports.
Continue reading...
March 15, 2009
FCC
Adds More DTV Consumer Education Requirements
On Friday, the FCC released its further Report and Order addressing the termination of analog service between now and June 12th, and revising the current DTV Consumer Education Requirements. Despite the apparent success of the February 17th turn-off of approximately one-third of the analog television stations in the country, the FCC has now ratcheted up the DTV Consumer Education requirements at the eleventh
hour. The FCC has expanded and revised its rules significantly, so stations should review the Commission's Order carefully and adjust their efforts and the content of their spots, crawls, etc., as necessary. These new requirements will go into effect starting April 1st. The full copy of the FCC's Order is available here, and a summary of the new DTV education requirements is as follows: Continue reading...
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