Programming Regulations Category

FCC Enforcement Monitor

Scott R. Flick Carly A. Deckelboim

Posted October 22, 2014

By Scott R. Flick and Carly A. Deckelboim

October 2014

Pillsbury's communications lawyers have published FCC Enforcement Monitor monthly since 1999 to inform our clients of notable FCC enforcement actions against FCC license holders and others. This month's issue includes:

  • $86,400 Fine for Unlicensed and Unauthorized BAS Operations
  • Missing "E/I" Graphic for Children's Television Programs Results in Fine
  • Multiple Rule Violations Lead to $16,000 in Fines

Increased Fine for Continuing Broadcast Auxiliary Services Operations After Being Warned of Violations

Earlier this month, the FCC issued a Notice of Apparent Liability for Forfeiture ("NAL") against a Texas licensee for operating three broadcast auxiliary services ("BAS") stations without authorizations and operating an additional six BAS stations at variance with their respective authorizations. The FCC noted that it was taking this enforcement action because it has a duty to prevent unlicensed radio operations from potentially interfering with authorized radio communications in the United States and to ensure the efficient administration and management of wireless radio frequencies.

Section 301 of the Communications Act provides that "[n]o person shall use or operate any apparatus for the transmission of energy of communications or signals by radio . . . except under and in accordance with this Act and with a license in that behalf granted under the provisions of the Act." In addition, Section 1.947(a) of the FCC's Rules specifies that major modifications to BAS licenses require prior FCC approval, and Section 1.929(d)(1) provides that changes to BAS television coordinates, frequency, bandwidth, antenna height, and emission type (the types of changes the licensee made in this case) are major modifications. The base fine for operating a station without FCC authority is $10,000 and the base fine for unauthorized emissions, using an unauthorized frequency, and construction or operation at an unauthorized location, is $4,000.

In April 2013, the licensee submitted applications for three new "as built" BAS facilities and six modified facilities. The modifications pertained to updates to the licensed locations of some of the licensee's transmit/receive sites to reflect the as-built locations, changes to authorized frequencies, and recharacterization of sites from analog to digital. The licensee disclosed the three unauthorized stations and six stations operating at variance from their authorizations in these April 2013 applications. As a result of the licensee's disclosures, the Wireless Telecommunications Bureau referred the matter to the Enforcement Bureau (the "Bureau") for investigation. In November 2013, the Bureau's Spectrum Enforcement Division instructed the licensee to submit a sworn written response to a series of questions about its apparent unauthorized operations. The licensee replied to the Bureau in January 2014 and admitted that it operated the nine BAS facilities either without authorization or at variance with their authorizations. The licensee also admitted that it learned of the violations in May 2012 while conducting an audit of its BAS facilities. Finally, the licensee noted that it could not identify the precise dates when the violations occurred but that they had likely been ongoing for years and possibly since some of the stations were acquired in 1991 and 2001.

The FCC concluded that the licensee had willfully and repeatedly violated the FCC's rules and noted that the base fine amount was $54,000, comprised of $30,000 for the three unauthorized BAS stations and $24,000 for the six BAS stations not operating as authorized. The licensee had argued that a $4,000 base fine should apply to the three unauthorized BAS stations because the FCC had previously imposed a $4,000 fine for similar violations when the licensee had color of authority to operate the BAS stations pursuant to an existing license for its full-power station. The FCC rejected this argument and noted that its most recent enforcement actions applied a $10,000 base fine for unlicensed BAS operations even where the full-power station license was valid.

The FCC concluded that the extended duration of the violations, including the continuing nature of the violations after the licensee became aware of the unlicensed and unauthorized operations, merited an upward adjustment of the proposed fine by $32,400. The FCC indicated that the licensee's voluntary disclosure of the violations before the FCC began its investigation did not absolve the licensee of liability because of the licensee's earlier awareness of the violations and the extended duration of the violations. The FCC therefore proposed a total fine of $86,400.

Reliance on Foreign-Language Programmer Did Not Affect Licensee's $3,000 Fine

The Chief of the Video Division of the FCC's Media Bureau issued an NAL against a California licensee for failing to properly identify educational children's programming through display on the television screen of the "E/I" symbol.

The Children's Television Act of 1990 introduced an obligation for television broadcast licensees to offer programming that meets the educational and informational needs of children ("Core Programming"). Section 73.671(c)(5) of the FCC's Rules expands on this obligation by requiring that broadcasters identify Core Programming by displaying the "E/I" symbol on the television screen throughout the program.

The licensee filed its license renewal application on August 1, 2014. The licensee certified in the application that it had not identified each Core program at the beginning of each program and had failed to properly display the "E/I" symbol during educational children's programming aired on a Korean-language digital multicast channel. In September 2014, the licensee amended its license renewal application to specify the time period when the "E/I" symbol was not used and two days later amended the renewal application again to state that it had encountered similar issues with displaying the "E/I" symbol on the station's Chinese-language digital multicast channel.

Continue reading "FCC Enforcement Monitor"


FCC Announces Grant of 700 Delayed Broadcast License Renewals

Scott R. Flick

Posted October 9, 2014

By Scott R. Flick

In a post today on the FCC's Blog, Diane Cornell, Special Counsel to Chairman Wheeler, described the FCC's efforts to reduce backlogs of applications, complaints, and other proceedings pending at the FCC. The post announces that the Consumer and Governmental Affairs Bureau has closed 760 docketed proceedings, and is on track to close another 750 by the end of the year. The post also indicates that the FCC's Wireless Bureau resolved 2046 applications older than six months, reducing the backlog of applications by 26%.

Of particular interest to broadcasters, however, is the news that the "Enforcement Bureau has largely completed its review of pending complaints, clearing the way for the Media Bureau to grant almost 700 license renewals this week." Many of these pending complaints were presumably based on indecency claims, which have in recent years created such a backlog of license renewal applications (particularly for TV stations) that it has not been unusual for a station to have multiple license renewal applications pending at the FCC, even though such applications are only filed every eight years.

For those unable to buy or sell a broadcast station, or to refinance its debt, because that station's license renewal application was hung up at the FCC, this will be welcome news. Just two years ago, the number of indecency complaints pending at the FCC exceeded 1,500,000, dropping to around 500,000 in April of 2013, when the FCC proposed to "focus its indecency enforcement resources on egregious cases and to reduce the backlog of pending broadcast indecency complaints."

While indecency and other complaints will certainly continue to arrive at the FCC in large numbers given the ease of filing them in the Internet age, today's news brings hope that most of them will be addressed quickly, and that long-pending license renewal applications will become a rarity at the FCC. That would be welcome news for broadcasters, who frequently found that the application delays caused by such complaints were far worse than any fine the FCC might levy. Such delays were particularly galling in the many cases where the focus of the complaint was content wildly outside the FCC's definition of indecency ("language or material that, in context, depicts or describes, in terms patently offensive as measured by contemporary community standards for the broadcast medium, sexual or excretory organs or activities").

For a number of years, complaints that merely used the word "indecent" were put in the "indecency complaint" stack, resulting in multi-year holds on that station's FCC applications. I once worked on a case where a politician who had been criticized in a TV's newscast for his performance in office filed an FCC complaint stating that the station's comments about him were "indecent". You guessed it; this exercise of a station's First Amendment right to criticize a public official resulted in a hold being placed on the station's FCC applications for years while the complaint sat at the FCC.

The FCC's efforts to eliminate these delays, and the inordinate leverage such delays gave to even the most frivolous complaints, are an excellent example of the FCC staff working to accomplish the Commission's public interest mandate. While broadcasters may feel they have not have had many reasons to cheer the FCC in recent years, today's announcement certainly merits some applause.


Big Fines for False EAS Tones Demonstrate the Need for a Good Indemnification Clause

Scott R. Flick

Posted March 3, 2014

By Scott R. Flick

There was quite a stir today when the FCC, despite being closed for a snow day, issued a Notice of Apparent Liability proposing very large fines against Viacom ($1,120,000), NBCUniversal ($530,000), and ESPN ($280,000) for transmitting false EAS alert tones. According to the FCC, all three aired an ad for the movie Olympus Has Fallen that contained a false EAS alert tone, with Viacom airing it 108 times on seven of its cable networks, NBCUniversal airing it 38 times on seven of its cable networks, and ESPN airing it 13 times on three of its cable networks.

The size of the fines certainly drew some attention. Probably not helping the situation was the ad's inclusion of the onscreen text "THIS IS NOT A TEST" and "THIS IS NOT A DRILL" while sounding the EAS tone. The FCC launched the investigation after receiving complaints from the public.

All three entities raised a variety of arguments that were uniformly rejected by the FCC, including that "they had inadequate notice of the requirements and applicability of the rules with respect to EAS violations." What particularly caught my eye, however, was that all three indicated the ad had cleared an internal review before airing, and in each case, those handling the internal review were apparently unaware of Section 325 of the Communications Act (prohibiting transmission of a "false or fraudulent signal of distress") and Section 11.45 of the FCC's Rules, which states that "No person may transmit or cause to transmit the EAS codes or Attention Signal, or a recording or simulation thereof, in any circumstance other than in an actual National, State or Local Area emergency or authorized test of the EAS."

Back in 2010, I wrote a post titled EAS False Alerts in Radio Ads and Other Reasons to Panic that discussed the evolution of the FCC's concerns about false emergency tones in media, which originally centered on sirens, then on Emergency Broadcast System tones, and now on the Emergency Alert System's digital squeals. Two months later, I found myself writing about it again (The Phantom Menace: Return of the EAS False Alerts) when a TV ad for the movie Skyline was distributed for airing with a false EAS tone included in it.

That was the beginning of what has since become a clear trend. Those initial posts warned broadcasters and cable programmers to avoid airing specific ads with false EAS tones, but were not connected to any adverse action by the FCC. After three years of EAS tone tranquility, the issue reemerged in 2013 when hackers managed to commandeer via Internet the EAS equipment of some Michigan and Montana TV stations to send out false EAS alert warnings of a zombie attack. The result was a rapid public notice from the FCC instructing EAS participants to change their EAS passwords and ensure their firewalls are functioning (covered in my posts FCC Urges IMMEDIATE Action to Prevent Further Fake EAS Alerts and EAS Alerts and the Zombie Apocalypse Make Skynet a Reality), but no fines.

From there we moved in a strange direction when the Federal Emergency Management Agency distributed a public service announcement seeking to educate the public about the Emergency Alert System, but used an EAS tone to get that message across. Because it did not involve an actual emergency nor a test of the EAS system, the PSA violated the FCC's rule against false EAS tones and broadcasters had no choice but to decline to air it. The matter was resolved when the FCC quickly rushed through a one-year waiver permitting the FEMA ad to be aired (Stations Find Out When Airing a Fake EAS Tone Is Okay).

Late last year, however, the evolution of the FCC's treatment of false EAS alerts turned dark (FCC Reaches Tipping Point on False EAS Alerts) when the FCC issued the first financial penalties for false EAS alerts. The FCC proposed a $25,000 fine for Turner Broadcasting and entered into a $39,000 consent decree with a Kentucky radio station for airing false EAS alert tones. The FCC indicated at the time that other investigations were ongoing, and more fines might be on the way.

We didn't have to wait long, as just two months later, the FCC upped the ante, proposing a fine of $200,000 against Turner Broadcasting for again airing false EAS alert tones, this time on its Adult Swim network. The size of the fine was startling, and according to the FCC, was based upon the nationwide reach of the false EAS tone ad, as well as the fact that Turner had indicated in connection with its earlier $25,000 fine that it had put in place mechanisms to prevent such an event from happening again. When it did happen again, the FCC didn't hesitate to assess the $200,000 fine.

Today's order, issued less than two months after the last Turner decision, ups the ante once again, proposing fines of such size that only some of the FCC's larger indecency fines compare. The FCC is clearly sending a signal that it takes false EAS tones very seriously, and the fact that the ads containing the EAS tones were produced by an independent third party didn't let the programmers off the hook. In other words, it doesn't matter how or why the ads got on the air; the mere fact that they aired is sufficient to create liability.

So what lesson should broadcasters and cable networks take away from this? Well, the all too obvious one is to do whatever it takes to prevent false EAS tones from making it on air. However, an equally useful lesson is to make sure that your contracts with advertisers require the advertiser to warrant that the spots provided will comply with all laws and to indemnify the broadcaster or network if that turns out not to be the case. That won't save you from a big FCC fine and a black mark on your FCC record, but it will at least require the advertiser to compensate you for the damages you suffered in airing the ad and defending yourself. Unfortunately, many advertising contracts are not particularly well drafted (and some are just a handshake), which can expose you to a variety of liabilities like this unnecessarily.

It is therefore wise to have both your ad contracts and your advertising guidelines carefully reviewed by counsel experienced in this area of the law. Vigilant review of ads submitted for airing is an excellent first line of defense, but as demonstrated in today's decision, it won't do much good if the individuals reviewing the ads don't know what to look for.


FCC Enforcement Monitor

Scott R. Flick Carly A. Deckelboim

Posted January 24, 2014

By Scott R. Flick and Carly A. Deckelboim

January 2014

Pillsbury's communications lawyers have published FCC Enforcement Monitor monthly since 1999 to inform our clients of notable FCC enforcement actions against FCC license holders and others. This month's issue includes:

  • FCC Admonishes Television Stations for "Host-Selling" to Children
  • $7,500 Fine Imposed for Documents Missing From Public Inspection File
  • $17,000 Fine for Unauthorized Operation of a Radio Transmitter

Admonishment Issued for Program Characters Promoting a Product

The FCC continues to enforce its restrictions on commercial content during children's shows. Section 73.670 of the FCC's Rules restricts the amount of commercial matter that can be aired during children's programming to 10.5 minutes per clock hour on weekends and 12 minutes per clock hour on weekdays. The Commission most often examines compliance with these limitations when acting on a television station's license renewal application.

Earlier this month, the FCC issued identical admonishments to two commonly-owned Wisconsin TV stations for failing to comply with the limits on commercial matter in children's programming. The stations disclosed in their license renewal applications that they had aired a commercial for cereal during a children's program seven years ago, and the commercial contained "glimpses of characters from the program on the screen." The licensee noted that the appearance was "small, fleeting, and confined to a small area of the picture," and that the software used by the CW Network to prevent such appearances failed to catch this particular incident. Where a program character appears during a commercial in that program, the FCC's approach is to treat the entire program as a commercial, which by definition exceeds the FCC's commercial time limits in children's programming.

The licensee argued that the images did not appear "during the commercial part of the spot but during a portion of the material promoting a contest." The FCC disagreed, but only issued an admonishment to each of the stations because the violation was an isolated incident. Nevertheless, the FCC warned that it would impose more serious sanctions if the licensee committed any similar violations in the future.

License Assessed $7,500 Fine for Failing to Provide Quarterly Issues/Programs Lists for Seventeen Quarters

Earlier this month, the FCC imposed a $7,500 fine on a Pennsylvania station for willfully and repeatedly violating the Commission's rule regarding the public inspection file. Under Section 73.3526(e)(12) of the FCC's Rules, a licensee must create a list of significant issues affecting its viewing area in the past quarter and the programs it aired during that quarter to address those issues. The list must then be placed in the station's public inspection file by the tenth day of the month following that quarter.

In April of 2010, an agent from the Enforcement Bureau's Philadelphia office found during an inspection that the licensee was missing fifteen quarters of issues/programs lists. The licensee explained in response to a subsequent Letter of Inquiry that some of the lists had been stolen or removed from the public inspection file and promised to replace the missing lists. However, in February of 2011, a follow-up investigation revealed that the public inspection file contained only one issues/programs list, which meant that there was a total of seventeen quarters of missing lists. At the time of the follow-up, the licensee said that part of the roof of a neighboring building had collapsed and destroyed the records.

In June of 2011, the FCC issued a Notice of Apparent Liability for Forfeiture ("NAL") for $15,000. In response, the licensee argued that the fine should be reduced because the missing records were outside his control and that he did not have the ability to pay such a fine. In January of 2014, the FCC determined that a reduction of the fine was warranted based on the licensee's inability to pay, but noted that the failure to maintain issues/programs lists was not outside of the licensee's control and that the licensee's explanations as to the cause of the missing documents conflicted with each other. Although the FCC reduced the fine from $15,000 to $7,500, the Enforcement Bureau cautioned that it has previously rejected inability to pay claims for repeated or egregious violations and that in the event this licensee commits future violations, it may result in significantly higher fines that may not be reduced merely because of the licensee's inability to pay.

Licensee Fined for Interfering with United States Coast Guard Operations

Last month, the FCC issued an NAL against a California licensee for operating a radio transmitter on a frequency not authorized by its license and failing to take precautionary measures to avoid causing interference. The base fine for operating on an unauthorized frequency is $4,000, and the base fine for interference is $7,000.

In January of last year, the United States Coast Guard complained to the FCC of interference with its operations in the 150 MHz VHF band. An agent from the Enforcement Bureau's Los Angeles office used radio direction-finding methods to determine that the interference was coming from the licensee's building. The agent located a transmitter at that location that was operating on a frequency different than that indicated on the transmitter's label. After the Bureau contacted the licensee and informed it of the agent's findings, the licensee turned off the transmitter, and the interference to the Coast Guard stopped.

Subsequently, the Enforcement Bureau's Los Angeles office issued a Notice of Violation ("NOV") to the licensee for failing to operate in accordance with its authorization and not taking reasonable precautions to avoid interference to licensed services. The NOV noted that the licensee's authorization specified operation on frequencies that included neither the transmitter's labeled frequency nor the frequency on which the transmitter was actually operating. In response, the licensee argued that the transmitter was unstable and operating about .8 MHz on both sides of the designated frequency.

Under Section 1.903(a) of the FCC's Rules, a licensee can only operate a station in compliance with a valid authorization granted by the Commission. The FCC rejected the licensee's argument that the malfunctioning transmitter was operating on the licensee's assigned frequency, finding that its agent's investigation indicated otherwise. The FCC also noted that Section 90.403(e) of the FCC's Rules requires that licensees take appropriate measures to avoid causing harmful interference, and that the licensee here failed to offer any evidence in response to the NOV that it had taken such precautions.

In determining the appropriate fine, the FCC considered the facts and circumstances and found that the violations warranted proposing a fine higher than the base amount for these violations. Because the licensee caused harmful interference to the Coast Guard's operations and the licensee was not aware of its spurious signal until the FCC notified it, the FCC assessed a total fine of $17,000, increasing the fine by $6,000 over the base amount for such violations.

A PDF version of this article can be found at FCC Enforcement Monitor.


FCC Prophecy on False EAS Alerts Comes True to the Tune of $200,000

Scott R. Flick

Posted January 14, 2014

By Scott R. Flick

Over the years, I've written numerous times about the FCC's adverse reaction to advertisers seeking to make their ads more attention-getting through inclusion of an Emergency Alert System tone. The most recent was this past November, when the FCC proposed a $25,000 fine against Turner Broadcasting System, Inc. for an EAS tone-laden Conan promo, and announced a $39,000 consent decree with a Kentucky TV station for a local sports apparel store ad containing an EAS alert tone.

I titled the post FCC Reaches Tipping Point on False EAS Alerts, and noted at the end of it that

ominously, today's FCC Enforcement Advisory notes that "[o]ther investigations remain ongoing, and the Bureau will take further enforcement action if warranted." Given today's actions by the FCC, everyone whose job it is to review ad content before it airs is having a very bad day.
Today, the FCC fulfilled that prophecy, proposing an additional $200,000 fine against Turner Broadcasting System, Inc. for distributing another ad containing EAS tones. According to the FCC, Turner's Adult Swim Network aired ads produced by Sony Music Group promoting an album by rap artist A$AP Rocky and the album's availability at Best Buy stores. While the ad did not contain any digital data from an EAS tone, it did simulate the EAS audio tone itself. The ad aired seven times over the network's East Coast feed, and then was repeated seven more times in the West Coast feed three hours later.

The FCC's decision is "spirited" (at least by FCC standards), managing to convey a fair degree of exasperation, principally because of Turner's prior violation and the fact that

In response to those [earlier] complaints, which also emphasized the potential impact on public safety of the transmission of such material, Turner represented to the Commission that it had changed certain of its internal review practices. Nevertheless, another Turner-owned channel, less than one year later, transmitted the A$AP Rocky/Best Buy advertisement 14 times over a six day period, which also contained simulations of the EAS codes. Thus, despite its experience with the problem of misusing EAS codes and Attention Signals, Turner continued to violate Section 11.45 of the Commission's rules and Section 325(a) of the Act, indicating a higher degree of culpability in this instance. Therefore, based on the number of transmissions at issue, the amount of time over which the transmissions took place, the nationwide scope of Adult Swim Network's audience reach, Turner's degree of culpability, Turner's ability to pay, and the serious public safety implications of the violations, as well as the other factors as outlined in the Commission's Forfeiture Policy Statement, we find that a forfeiture of two hundred thousand dollars ($200,000) is appropriate.
Beyond the unprecedented size of the fine for such a violation, today's decision is also notable because, unlike the self-inflicted wound of putting an EAS tone in a program promo, this case involved a spot produced by a third party. While the FCC has appeared in the past to have had at least some sympathy where a problem in a third-party ad "slipped through", the FCC's sympathy seems to be exhausted at this point. Having said that, it is worth noting that the FCC went after the program network rather than the individual cable and satellite systems that actually transmitted the spots to the public. Cable and satellite providers can take at least some solace in that.

While the nationwide audience and prior violation may have made the size of this fine somewhat unique, it is safe to say that the FCC has reached the point that it is unlikely to find a false EAS tone, no matter the circumstances, to be an excusable "oops" on the part of a program distributor. While the FCC might once have been willing to just admonish a violator and save the fines for repeat offenders, it appears that there will no longer be any free bites at the false EAS tone apple, and that each bite will be appreciably more expensive than the last.

Of course, if the FCC is hoping that steadily escalating fines will cause violators to lose their taste for the forbidden fruit of false EAS tones in ads, the question is whether advertisers will also hear that message, or are broadcasters, cable operators and satellite TV providers forever doomed to play a game of whack-a-mole (whack-a-tone?) with third-party ads?


FCC Enforcement Monitor

Scott R. Flick Paul A. Cicelski

Posted November 26, 2013

By Scott R. Flick and Paul A. Cicelski

November 2013

Pillsbury's communications lawyers have published FCC Enforcement Monitor monthly since 1999 to inform our clients of notable FCC enforcement actions against FCC license holders and others. This month's issue includes:

  • Multiple Indecency Complaints Result in $110,000 Payment
  • $42,000 in Fines for Excessive Power, Wrong Directional Patterns and Incomplete Public Inspection Files
  • Cable Operator Fined $25,000 for Children's Programming Reports

Broadcaster Enters Into $110,000 Consent Decree Involving Allegations of Indecent Material

The FCC recently approved a consent decree involving a broadcaster with TV stations in California, Utah and Texas accused of airing indecent and profane content.

Section 73.3999 of the FCC's Rules prohibits radio and television stations from broadcasting obscene material at all times and prohibits indecent material aired between 6:00 a.m. and 10:00 p.m.

The FCC received multiple complaints about the television show in question and sent Letters of Inquiry to the broadcaster asking it to provide a copy of the program and to answer questions about possible violations of the FCC's indecency rule. The licensee complied with the requests but maintained that the program did not contain indecent content.

Earlier this month, the FCC entered into a consent decree with the broadcaster and agreed to terminate its investigation and dismiss the pending indecency complaints. Under the terms of the consent decree, the broadcaster is required to (a) designate a Compliance Officer within 30 days, and (b) create and implement a company-wide Compliance Plan within 60 days, which must include: (i) creating operating procedures to ensure compliance with the FCC's restrictions on indecency, (ii) drafting a Compliance Manual, (iii) training employees about what constitutes indecent content, and (iv) reporting noncompliance to the FCC within 30 days of discovering any violations. The consent decree also requires the filing of a compliance report with the FCC in 90 days and annually thereafter for a period of 3 years. The requirements imposed under the consent decree expire after three years.

Continue reading "FCC Enforcement Monitor"


DOJ Clears the Air on E-Cigarette Ads

Scott R. Flick

Posted September 18, 2013

By Scott R. Flick

One of the perennial challenges of being a broadcaster is determining what you can air, when you can air it, and how it must be aired without incurring the wrath of the federal government. While the FCC tends to be the federal agency most commonly encountered on content issues, various other government agencies create additional layers of complexity, with the Department of Justice, the Food and Drug Administration, and the Federal Trade Commission all having an interest in what is aired, particularly where it involves advertising. As new products become available and are marketed, the government struggles to keep up, sometimes leaving the media in the lurch as to whether a particular ad is "safe" for airing.

For that reason, broadcasters have stepped carefully with regard to advertisements for medical marijuana (which I've discussed previously here), tobacco products, and other items of federal concern. While enforcement encounters with the FCC can be unpleasant, encounters with the DOJ can be downright incarcerating. Fortunately, broadcasters' encounters with the DOJ are rare, and usually involve the DOJ bringing a court action to enforce collection of an FCC-imposed fine. However, that also means the body of DOJ precedent on substantive content issues can be pretty thin, leaving broadcasters guessing as to what can and cannot be aired.

One area where the DOJ has definitely had a broad role to play is in the advertising of tobacco products. From the original ban on broadcast cigarette advertising implemented in 1971 to its later expansion to little cigars (1973) and smokeless tobacco (1986), the DOJ is the entity charged with enforcing the ban on most types of tobacco broadcast advertising. While a ban on tobacco advertising might seem straightforward, complying with it can be fairly complex, resulting in a number of DOJ decisions regarding what can be said in advertising for tobacco shops and tobacco products not affected by the ad ban. Our recently updated Pillsbury Advisory on tobacco advertising restrictions is a good place to learn more about those nuances.

One new product that continues to garner attention (and confusion) is e-cigarettes, which are battery-powered devices designed to imitate the look and feel of a cigarette, but which deliver nicotine vapor rather than tobacco smoke to the lungs. While e-cigarettes have become fairly common, only limited research has been done on their health effects, and many countries have now regulated them in a variety of ways.

In the U.S., the FDA has expressed serious concerns about the manufacturing and marketing of e-cigarettes, but has not yet been successful in implementing restrictions on e-cigarette sales. However, there have been indications the FDA will move as early as next month to launch a rulemaking to implement restrictions on e-cigarette sales. While it is likely that any ultimate FDA rules will prohibit the marketing of e-cigarettes to minors, it is at this point unknown whether the FDA might try to impose broader restrictions on advertising, and whether such restrictions would stand up in court. What is known is that rulemakings at federal agencies take time, so it will likely be a while before any new FDA rules could be implemented.

That pretty much leaves the question of whether e-cigarettes can currently be advertised up to the DOJ. Given the DOJ's dim view under existing tobacco ad restrictions of any ad that even mentions the word "cigarette", many assumed that the DOJ would take a similar view of e-cigarette advertising. However, because the DOJ has not publicly moved to take action against a growing number of e-cigarette ads, broadcasters have so far been left wondering where the government stands on the issue.

We now know the answer to that question. My Pillsbury colleague Paul Cicelski has obtained clarification from the Department of Justice in the form of a letter stating the DOJ's position on e-cigarette advertising. The letter notes that the ad ban covers "any roll of tobacco" wrapped in paper, tobacco, or any other substance likely to be purchased by consumers as a "cigarette". It proceeds to note that while e-cigarettes are often manufactured to look like conventional cigarettes, they do not contain a "roll of tobacco" and therefore are not subject to the federal ban on cigarette ads.

So does that mean the floodgates are open on e-cigarette ads? Not quite. First, the DOJ letter indicates that it reflects the views of the Consumer Protection Branch of the DOJ and not "any other governmental office, agency or department," specifically noting that the Federal Trade Commission has authority over e-cigarette ads that are deceptive, such as those that make health claims without adequate scientific support. Similarly, many states have grown concerned about e-cigarettes and have introduced legislation to restrict their use and advertising. As a result, in addition to being wary of health claims in ads like "e-cigarettes will help you stop smoking", broadcasters should check the laws of their state for any state-based limitations on e-cigarette advertising. Finally, as noted above, the FDA is clearly interested in this area, and likely will have something to say about e-cigarette regulation once it concludes its soon-to-be-launched e-cigarette proceeding.

Fortunately, the FTC and FDA have traditionally focused their enforcement efforts on advertisers rather than on the media entities carrying the ads, so even if e-cigarette regulations are ultimately adopted, those regulations are unlikely to principally target broadcasters for merely running the ads. As a result, the DOJ's position on e-cigarettes goes a long way toward resolving a significant source of confusion and angst for many broadcasters while opening up an additional avenue for broadcast ad dollars.


2012 Fourth Quarter Issues/Programs List Advisory for Broadcast Stations

Scott R. Flick

Posted December 1, 2012

By Scott R. Flick

The next Quarterly Issues/Programs List ("Quarterly List") must be placed in stations' public inspection files by January 10, 2013, reflecting information for the months of October, November, and December 2012.

Content of the Quarterly List
The FCC requires each broadcast station to air a reasonable amount of programming responsive to significant community needs, issues, and problems as determined by the station. The FCC gives each station the discretion to determine which issues facing the community served by the station are the most significant and how best to respond to them in the station's overall programming.

To demonstrate a station's compliance with this public interest obligation, the FCC requires the station to maintain and place in the public inspection file a Quarterly List reflecting the "station's most significant programming treatment of community issues during the preceding three month period." By its use of the term "most significant," the FCC has noted that stations are not required to list all responsive programming, but only that programming which provided the most significant treatment of the issues identified.

Given that program logs are no longer mandated by the FCC, the Quarterly Lists may be the most important evidence of a station's compliance with its public service obligations. The lists also provide important support for the certification of Class A station compliance discussed below. We therefore urge stations not to "skimp" on the Quarterly Lists, and to err on the side of over-inclusiveness. Otherwise, stations risk a determination by the FCC that they did not adequately serve the public interest during the license term. Stations should include in the Quarterly Lists as much issue-responsive programming as they feel is necessary to demonstrate fully their responsiveness to community needs. Taking extra time now to provide a thorough Quarterly List will help reduce risk at license renewal time.

It should be noted that the FCC has repeatedly emphasized the importance of the Quarterly Lists and often brings enforcement actions against stations that do not have fully complete Quarterly Lists or that do not timely place such lists in their public inspection file.

A PDF version of this entire article can be found at Fourth Quarter Issues/Programs List Advisory for Broadcast Stations.


FCC Enforcement Monitor

Scott R. Flick

Posted August 30, 2012

By Scott R. Flick and Lauren A. Birzon

July 2012
Pillsbury's communications lawyers have published FCC Enforcement Monitor monthly since 1999 to inform our clients of notable FCC enforcement actions against FCC license holders and others. This month's issue is a special issue regarding recent FCC actions that provide a detailed (and expensive) look at Section 73.1206, the prohibition on recording telephone calls for broadcast.

FCC Issues a Total of $41,000 in Fines for Broadcaster Airing Prank Telephone Calls

The close of August in Washington, D.C. has brought with it a surge of beautiful weather, baseball excitement (for the first time in recent memory), and ... forfeiture orders related to the improper recording of telephone calls for broadcast. On August 22nd, the FCC issued two forfeiture orders assessing a combined $41,000 in fines against licensees owned by the same parent company for violations of the telephone broadcast rule.

The telephone broadcast rule, Section 73.1206 of the Commission's Rules, requires that, "[b]efore recording a telephone conversation for broadcast, or broadcasting such a conversation simultaneously with its occurrence, a licensee shall inform any party to the call of the licensee's intention to broadcast the conversation, except where such party is aware, or may be presumed to be aware from the circumstances of the conversation, that it is being or likely will be broadcast." While the rule language only talks about providing notice to the calling party, the FCC has reiterated many times that when a station employee intends to record a call for broadcast or broadcasts the call live, the employee must also obtain the party's consent before recording the call or going live.

Both orders released on August 22nd involved a finding that the licensee had violated this rule. The first order involved prank calls made in April 2006 by radio personalities to members of the public during a comedy segment of the station's morning show. In one conversation, the caller pretended to be an intruder hiding under the bed of the person receiving the call; in another, the caller pretended to be a loan shark bent upon collecting a debt.

The FCC began investigating the prank calls after receiving a complaint from a station listener. During the investigation, the licensee indicated it was unable to confirm or deny whether the prank calls aired on its morning show, and could not provide a recording or transcript of the program. The licensee acknowledged, however, that the program identified in the complaint was aired on the station and was simulcast on two co-owned stations.

The second forfeiture order released on the 22nd also involved the broadcast of an alleged prank call in which the caller pretended to be a hospital employee who then informed the call recipient that the recipient's husband had been in a motorcycle accident and died at the hospital. When questioned about the incident, the licensee told the FCC that its parent company had contracted with an outside vendor who made and recorded the call. The licensee admitted that it broadcast the call on multiple occasions.

In the first case, the FCC had proposed a $25,000 fine. In the second case, the FCC had proposed a $16,000 fine. In both cases, the licensee urged cancellation of the proposed fines, to no avail. In batting down a myriad of arguments raised by the licensees, the FCC affirmed not only its broad investigative powers to enforce Section 73.1206, but also the licensees' responsibility to both adhere to and demonstrate their adherence to the Commission's Rules.

These two decisions provide an excellent primer for broadcasters on the FCC's enforcement of the telephone broadcast rule, as between them, the FCC addressed a multitude of defenses raised by the licensees, ultimately concluding that none of those defenses could prevent the imposition of very substantial fines. More specifically, the FCC shot down each of the following licensee arguments:

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FCC Piles $65,000 in Fines on Small AM Station in Less Than a Year

Andrew S. Kersting

Posted June 28, 2012

By Andrew S. Kersting

The FCC recently issued two separate Notices of Apparent Liability for Forfeiture (NALs), found here and here, for a combined sum of $40,000 against the licensee of a Class D AM radio station for failing to make available a complete public inspection file, and submitting what the FCC concluded was incorrect factual information concerning the station's public inspection file. According to the FCC, the station submitted the incorrect information without having a reasonable basis for believing that the information it provided to the Commission was accurate. What is most significant about this case is that this latest in fines is in addition to a $25,000 fine the FCC issued less than a year ago and included the same violation, bringing the licensee's collective contribution to the U.S. Treasury to $65,000 in the last 12 months.

By way of background, during a routine FCC inspection of an AM radio station in Texas back in December 2010, agents from the FCC's Enforcement Bureau's Houston Office found that the station failed to maintain a main studio with a meaningful full-time management and staff presence, determined that the station's public inspection file was missing a current copy of the station's authorization, its service contour map, the station's most recent ownership report filing, the Public and Broadcasting manual, and all issues-programs lists, and refused to make the public inspection file available. As a result, in June of last year, the Bureau issued an NAL in the amount of $25,000 for violating the FCC's main studio rule and public inspection file rules, and also required the licensee to "submit a statement signed under penalty of perjury by an officer or director of the licensee that . . . [the Station's] public inspection file is complete." In response to the FCC's directive, last August the licensee submitted a certification stating that "[i]n coordination with [an independent consultant], all missing materials cited have been placed in the Station's Public Inspection File, and the undersigned confirms that it is complete as of the date of this response."

Agents from the Enforcement Bureau's Houston Office returned to inspect the station's public inspection file last October and it turned out that once again the file did not contain any issues-programs lists. The agents also determined that none of the station employees present had knowledge of the station having ever kept issues-programs lists in the public inspection file.

In response to a Letter of Inquiry from the Enforcement Bureau regarding the missing lists, the licensee told the FCC that that the issues-programs folder was empty due to an "oversight" and that the licensee believed that the public file contained daily program logs of the programming aired by the party brokering time on the station. The licensee also stated in its response that it had hired an outside consultant to review the public file, who apparently indicated to the licensee that the public file "was complete."

Based on that follow-up visit, the Bureau released its first of two NALs issued on June 14, 2012, and cited the AM station for a failure to exercise "even minimal diligence prior to the submission" of its August certification stating that it was in full compliance with the FCC's Public Inspection File Rules. In addressing the licensee's violations, the Bureau noted that in 2003 the FCC expanded the scope of violations of Section 1.17 which states that no person should provide, in any written statement of fact, "material factual information that is incorrect or omit material information that is necessary to prevent any material factual statement that is made from being incorrect or misleading without a reasonable basis for believing that any such material factual statement is correct and not misleading."

As a result, information provided to the FCC - even if not intended to purposefully mislead the FCC - can result in fines if the licensee does not have "a reasonable basis for believing" that the information submitted is accurate. Licensees therefore need to be aware that an intent to deceive the Commission is not a prerequisite to receiving a fine; inaccurate statements or omissions that are the result of negligence can be costly as well.

As if that were not enough, the Bureau issued a second NAL on the same day in which it assessed a further fine against the licensee in the amount of $15,000 for failing to make available a "complete public inspection file." In determining the amount of this forfeiture, the Bureau noted that although the base forfeiture amount is $10,000 for public file rule violations, given the previous inspection by the agents from the Bureau's Houston Office, the licensee had a history of prior offenses warranting an upward adjustment in the forfeiture amount. The Bureau therefore concluded that because the licensee had violated the public inspection file rule twice within a one-year period - including after being informed that it had violated the Commission's rule - "its actions demonstrate[ed] a deliberate disregard for the Commission's rules and a pattern of non-compliance," warranting a $5,000 upward adjustment in the forfeiture amount.

This case is noteworthy because it demonstrates that parties dealing with the Commission must be mindful that, prior to submitting any application, report, or other filing to the FCC, it is important to ensure that the information being provided is accurate and complete in all respects. It also is significant for the high dollar amount of the fines the FCC issued to the licensee of a Class D AM station in a period of less than 12 months based on fairly common public file and main studio rule violations.


Office of Management and Budget, Keeping in Character, Approves FCC Online Public File Rules

Paul A. Cicelski

Posted June 22, 2012

By Paul A. Cicelski

The Office of Management and Budget (OMB) has once again rubber-stamped and approved an FCC information collection request in apparent defiance of its statutory obligation to take a hard look at the burdens imposed under the Paperwork Reduction Act (PRA). As I reported previously, the FCC adopted burdensome rules requiring television stations to replace their existing locally-maintained public inspection files with digital files to be placed online on an FCC-hosted website, including stations' detailed political records. What is a bit of a surprise, and frankly disappointing, is that the OMB took less than two weeks to approve the FCC's request even though the proposed rules appear to clearly violate the standards of the PRA, and lengthy comments were filed by multiple parties informing the OMB of that fact.

As I've stated, the new regulations will without question increase burdens on TV stations (including thousands of pages of copying, significant costs, and countless hours of employee time), while needlessly duplicating records already required to be maintained online by the Federal Election Commission. If such rules are not something the OMB should withhold approval of, or at least take a long hard look at, you have to wonder what level of burden is required to trigger a denial under the PRA. Very few FCC regulations that I can think of historically have imposed more paperwork burdens on stations than the online public/political file regulations.

In any case, in light of the OMB's approval, all Top 4 network affiliated stations in the top 50 markets will have to start placing political file material online 30 days after the FCC publishes a notice of the OMB approval in the Federal Register. I will provide an update when that publication occurs. However, there still may be some twists and turns coming, as it is more than likely that broadcasters will ask the courts to stay the effective date of the rules. If such a request is granted, the rules will not go into effect as quickly as the FCC is hoping.


Client Inspection Alert: FCC Votes to Require Online Posting of TV Public Inspection/Political Files

Paul A. Cicelski

Posted April 27, 2012

By Paul A. Cicelski

To follow up on my post from last week regarding the FCC's open meeting on implementing its proposals to require online posting of TV station public inspection files, including the political file, the FCC today voted to require television broadcasters to post their entire public inspection files online. FCC Commissioner McDowell dissented regarding the requirement that TV stations' political files be included online.

According to statements made in the FCC's meeting today, all TV stations will have six months to move their public inspection files online. The FCC has agreed to host TV public inspection files on its own website. With respect to the political file, online posting will be a "phased in" process. Stations affiliated with the top-four national networks in the top-50 Nielsen markets will be required to begin placing their political files online, with all other TV stations to follow on July 1, 2014. The FCC also indicated that it plans to issue a Public Notice in a year to evaluate the effectiveness of the process.

In adopting its Order, the FCC rejected a compromise proposal advanced last Friday by the National Association of Broadcasters, the ABC, CBS, NBC, Fox, and Univision networks, State Broadcasters Associations, as well as various television station groups. The compromise proposal would have permitted TV stations to provide summary information online, including the total amount of an advertising buy and the total amount of money a candidate has spent at that station on ads during a particular election window. The compromise proposal would have kept commercially-sensitive per unit rate information out of the online public file, while still including this information in the hard copy of the political file for candidates to inspect regarding lowest unit rate and other political advertising requirements.

Much more on these issues to follow, including further specifics on the details of the FCC's Order in this proceeding.


The FCC's "Stopwatch" Proposal to Evaluate Station Program Content

Richard R. Zaragoza

Posted February 24, 2012

By Richard R. Zaragoza and Lauren A. Birzon

Despite spring-like weather in Washington this winter, broadcasters, with good reason, have been busy filing frosty comments in response to the FCC's Notice of Inquiry (NOI) regarding "Standardizing Program Reporting Requirements for Broadcast Licensees."

Free Press and others are urging the FCC to require television stations to complete and publicly file a "Sample Form" setting forth the number of minutes that a station devoted, during a composite week period, to the broadcast of certain categories of FCC-selected programming. The proposed form (or some version of it) would take the place of the Quarterly Issues/Programs List requirement that was adopted by the Commission nearly thirty years ago after an exhaustive review of many of the same issues that caused the FCC in 2007 to adopt FCC Form 355 ("Standardized Television Disclosure Form"), which the Commission abandoned last year on its own motion.

The 46 State Broadcasters Associations (represented by our firm), three other State Broadcasters Associations, the National Association of Broadcasters, and a coalition of network television station owners, among others, filed comments alerting the FCC that its proposals to adopt new and detailed program reporting requirements raise serious questions about the Commission's authority to do so under the First Amendment. The 46 State Associations noted that "substitut[ing] a chiefly quantity of programming measure for public service performance, which is the focus of Free Press' Sample Form, would, in the State Associations' view, inappropriately, (i) elevate form (quantity of minutes) over substance (treatment of specific issues), (ii) place other undue burdens on stations, and (iii) intertwine the government for years to come in the journalistic news judgments of television broadcast stations throughout the country."

According to the State Associations and the NAB, the FCC's failure to address the clear constitutional questions raised is peculiar in light of First Amendment case law. They are referring to the Commission's proposed adoption of a quantity of programming approach to measure station performance, which would introduce the same type of "raised eyebrow" regulatory dynamic that the U.S. Court of Appeals for the D.C. Circuit in Lutheran Church found unlawfully pressured stations to hire based on race. According to that same court in the more recent MD/DC/DE Broadcasters case, the FCC has "a long history of employing...a variety of sub silentio pressures and 'raised eyebrow' regulation of program content...as means for communicating official pressures to the licensee." In Lutheran Church, the court concluded that "[n]o rational firm--particularly one holding a government-issued license--welcomes a government audit." The court also concluded that no rational broadcast station licensee would welcome having to expend its resources, and suffer any attendant application processing delays in having to justify their actions to the FCC, regardless of whether in response to a petition to deny an application, a complaint, or other objection filed by a third party.

The network television station owners also pressed the First Amendment issue by pointing out that it is well established that the First Amendment precludes the FCC from requiring the broadcast of particular amounts and types of programming. The network owners also noted that few broadcasters, confronted with a Commission form asking them to list all of their programming related to certain content categories, will not feel pressure to skew their editorial judgments in a conforming manner.

These comments reveal the difficult position in which the FCC places itself when it attempts to craft rules that relate to specific programming content. Having launched itself down that path, the question becomes whether the Commission will attempt to face these issues and address them in any resulting rule, or merely downplay them, requiring an appeals court to address them at a later date. Only after we know the answer to that question will we know whether the term "stopwatch review" refers to a new regime of FCC content regulation, or is merely a reference to how long it takes a court to find that such rules can't coexist with the First Amendment.


FCC Makes Online Contest Expensive

Scott R. Flick

Posted January 20, 2012

By Scott R. Flick

One of the curiosities of communications law is that while there are thousands of applicable rules and statutory provisions, there are a handful that the FCC likes to enforce with particular gusto. One of these is the rule regarding how on-air contests must be conducted. Over the years, many broadcasters have found this to be a "strict liability" rule, with any problem that occurs in an on-air contest being laid at the feet of the broadcaster along with the standard $4,000 fine. As a result, despite the myriad state laws governing the conduct of contests, broadcast contests tend to be some of the more carefully conducted contests out there.

The rule itself, Section 73.1216, is one of the most concise of the FCC's rules, being only two sentences long: "A licensee that broadcasts or advertises information about a contest it conducts shall fully and accurately disclose the material terms of the contest, and shall conduct the contest substantially as announced or advertised. No contest description shall be false, misleading or deceptive with respect to any material term." Significantly longer than the rule itself, however, are the three footnotes to the rule, which provide details about what must be disclosed and how. The key requirements are that the "material terms" of the contest be disclosed on-air through "a reasonable number of announcements". The typical basis for a $4,000 contest fine is that the station either fails to adequately disclose the material terms of the contest, or fails to comply with those terms in running the contest (for example, failing to award the stated prize).

What has changed since the current rule was adopted in 1976, however, is that stations increasingly have a station website with much content that is independent of their broadcast content, including online contests. While a station and its website will obviously cross-promote each other, neither is a substitute for the other, and each is a separate channel of communication with the public. As a general rule, the FCC has no jurisdiction over websites, and has not attempted to regulate contests that are not conducted on-air. While online contests are subject to numerous state and federal law requirements, they are not normally the subject of FCC proceedings.

Yesterday, however, the FCC released a decision proposing to fine a number of Clear Channel radio stations $22,000 for contest rule violations relating to a car contest conducted on the stations' websites. Both the size of the fine and the fact that it does not relate to a true on-air contest make it a noteworthy decision. In the contest, listeners were invited to submit video commercials for Chevrolet (keep in mind the stations fined were radio stations), with the contestant submitting the best commercial winning a car. The FCC received a complaint from a listener who argued that the stations involved in the contest failed to disclose the material terms of the contest on-air, failed to conduct the contest in accordance with the stated rules, and improperly awarded the prize to a friend of an employee.

While the FCC declined to find that the contest was "fixed" merely because the winner was a friend of a station employee, it did find that the stations failed to disclose the material terms of the contest on-air, and that the stations failed to conduct the contest in accordance with the rules in any event, principally because the rules were internally inconsistent. One provision in the rules stated that entries would be accepted through March 21, 2008, but another provision stated that judges would select a winner on March 10, 2008, before the stated deadline for entries had passed.

In its defense, Clear Channel argued that the FCC's rule doesn't apply, since the contest was conducted on the stations' websites, and was not a broadcast contest. In addition, it noted that the contest rules were posted on the station websites where the contest was being conducted. The FCC rejected this argument, stating that the stations had promoted the contest on-air, and that this cross-promotion made the contest a broadcast contest subject to the FCC's rule. Interestingly, it does not appear from the FCC's order that Clear Channel made the arguments that: (1) stations promote advertisers' contests all of the time and the mere fact that a contest is promoted on-air does not extend the FCC's jurisdiction to the conduct of those contests, and (2) there isn't any reason from a First Amendment standpoint for requiring a different level of disclosure from a broadcaster than any other party choosing to promote its online contest on-air.

Having concluded that its contest rule applied, the FCC found that the stations violated that rule when they failed to air announcements disclosing the material terms of the contest rules, and that they also violated the rule by failing to accurately state the deadline for entries, creating confusion among listeners. Noting that the contest was promoted on multiple stations, that Clear Channel has previously been found in violation of the contest rule on multiple occasions, and that Clear Channel has "substantial revenues", the FCC increased the base fine of $4000 to $22,000, an unusually high amount for a contest rule violation.

So what should broadcasters take away from this decision? First, that any on-air promotion of a contest makes it a "broadcast contest" unless the contest is conducted by a third party. In this regard, stations will want to be careful about co-sponsoring an advertiser's contest, since an advertised contest that otherwise fully complies with all state and federal laws can suddenly cause a problem if the FCC concludes that it is a licensee-conducted contest.

Second, and this part is nothing new, stations and others conducting contests need to make sure that the contest rules are carefully written, consistent with law, and not confusing to potential contestants. Surprising as it is, major companies holding national contests frequently fail to accomplish this successfully, and the lawyers in our Contests & Sweepstakes practice are regularly called upon to draft or revise contest rules to avoid this problem. Given yesterday's FCC decision, broadcasters have one more reason than everyone else to make sure that their contests, online or otherwise, are carefully conducted to comply with the law.


Oral Arguments Bring Supreme Court's Indecency Case into Focus

Paul A. Cicelski

Posted January 10, 2012

By Paul A. Cicelski

Having just returned from watching oral arguments at the Supreme Court in the highly anticipated case Federal Communications Commission v. Fox Television Stations, I can tell you that the case is living up to its billing as one of the more interesting matters before the Court. In it, the Court will finally have the opportunity to address the constitutionality of the FCC's current interpretation of its indecency restrictions on television and radio stations. Specifically, the Court is considering whether the Second Circuit was correct in deciding that the FCC's indecency ban is unconstitutional because it violates the First Amendment by being so vague and amorphous as to deprive broadcasters of clear notice as to what is and isn't permissible.

The underpinnings of the FCC's indecency regulation come from the now-famous George Carlin (RIP) "Seven Dirty Words" monologue. During the monologue, Carlin used, among other words, the "F-word" and the "S-word" repeatedly, and verbally presented a number of sexual and excretory images. The monologue was aired by a radio station, a complaint was filed, and the FCC ultimately determined that the broadcast was prohibited indecency. The case eventually found its way to the Supreme Court as the 1978 Pacifica case where, in a narrow 5-4 ruling, the FCC's indecency finding survived a First Amendment challenge. The Court stated that the FCC's decision was constitutional largely because "broadcasting is uniquely accessible to children."

For 25 or so years following the Pacifica case, the FCC exercised a light touch in enforcing its indecency ban, as evidenced by its statement that "speech that is indecent must involve more than an isolated use of an offensive word." However, in 2004, the FCC changed its longstanding policy on the use of isolated expletives, finding that a broadcast could be indecent even when the use of an expletive was not repeated or a literal description of sexual activities was not included.

As previously discussed by Scott Flick here and here, the FCC's effort to expand the definition of actionable indecency is at the heart of the case now before the Supreme Court. That case involves three separate incidents that were broadcast on TV between 2002 and 2003, each of which were found to be indecent by the FCC. The first two, the "fleeting expletives" incidents, occurred on Fox during the Billboard Music Awards when Cher used the "F-word", and then Nicole Richie used the "S-word" and "F-word" a year later on the same program.

The third broadcast at the center of the case involved a 2003 ABC broadcast of an episode of NYPD Blue that included the display of a woman's buttocks. In both the Fox and ABC cases, the Second Circuit concluded that the FCC's current indecency enforcement policy is "unconstitutional because it is impermissibly vague" since broadcasters do not have fair notice of "what is prohibited so that [they] may act accordingly."

During today's oral arguments, there was a great deal of lively banter between the Justices and the attorneys on both sides of the debate. The U.S. Solicitor General, on behalf of the government, argued that broadcast stations must comply with the FCC's indecency regulations as the price of holding a broadcast license and the privilege of "free and exclusive use of public spectrum." Justice Kagan noted, however, that the government's "contract theory" can only go so far when it comes to the First Amendment.

In response to the Solicitor General's claim that television today is as pervasive as it has ever been, Justice Ginsburg pointed out that the major complaint the broadcasters have is that the "censor" here, the FCC, can act arbitrarily by saying it is okay to broadcast otherwise indecent language or scenes during Schindler's List or Saving Private Ryan, but that it is not OK to air such material during an episode of NYPD Blue. Later, Justice Kagan joked that it seems like nobody "can use dirty words except for Steven Spielberg." While intended as a joke, the Justice would likely not be surprised that communications lawyers do indeed refer to the "Spielberg exception" in reviewing content before it airs.

In challenging the FCC's regulations, counsel for the broadcasters noted that the FCC's indecency policies had been working fine until the FCC "wildly changed their approach" in 2004 and that the current context-based approach is impermissibly vague. Of particular interest given that the pending cases all involve television broadcasts, when Justice Alito asked whether the broadcasters would accept the Supreme Court overruling Pacifica for purposes of television only and not for radio, the response in the courtroom appeared to be "yes". Both Chief Justice Roberts and Justice Scalia appeared skeptical of the broadcasters' arguments, with Chief Justice Roberts stating that "we, the government" only want to regulate "a few channels" and Justice Scalia remarking that the "government can require a modicum of values".

While you can only read so much into oral arguments, the huge crowd and the media circus I saw when leaving the Supreme Court underscore the interest in, and the importance of, the Court's ultimate decision in this case. Aside from the fact that Justice Sotamayor is recused from the case, and two Justices that voted against the FCC at an earlier stage of the case have since left the Court, the drama in this case has been dramatically increased given the strange bedfellows it could create among liberal and conservative Justices on the Court. Given that Justice Thomas is on record as criticizing the "deep intrusion in the First Amendment right of broadcasters" created by the FCC's indecency policies, it is not out of the realm of possibility to see Justice Thomas siding with Justices Breyer, Ginsburg, and Kagan (and maybe even Justice Kennedy) in finding that the FCC's indecency policy is unconstitutional.

However, that result is hardly a given. We have no idea how Justice Kagan will rule given her short time on the Court, nor do we know yet whether Chief Justice Robert's antipathy towards governmental paternalism -- evidenced in the Court's decision this past summer overturning a California law prohibiting the sale of violent video games to minors -- might find voice in this case as well. While many issues polarize people based upon their political perspective, fans of the First Amendment tend to be found all along the political spectrum. How the case is framed is therefore critically important. Is this a case about protecting children from ostensibly harmful content, or is this a case about making broadcast television fit only for children during the hours when most adults watch it? On a less philosophical and more pragmatic level, what are the First Amendment implications of making broadcasters have to guess what content the government will conclude is inappropriate for their audiences? Broadcasters are hoping the the Court's decision in this case will bring an end to those guessing games.