Articles Posted in Children & Media

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January 2016

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:

  • TV Licensee Agrees to Pay $18,000 for Public Inspection File Violations
  • FM Translator Licensee Faces $9,000 Fine for False Certification and Unauthorized Operation Violations
  • AM Station Licensee Pays $10,000 to End Investigation into Alleged Ownership Violations

Mistakes Over Off-Air Time in Public Inspection File Cost TV Licensee $18,000

The FCC’s Media Bureau entered into a Consent Decree with a Las Vegas Class A television licensee to resolve an investigation into whether the licensee violated the FCC’s Rules by improperly indicating  on four Children’s Television Programming Reports and TV Issues/Programs Lists that it was off-air, and failing to prepare mandatory certifications of Class A eligibility for over five years.

Section 73.3526 of the FCC’s Rules requires each commercial broadcast licensee to maintain a public inspection file containing specific information related to station operations. Subsection 73.3526(e)(11)(iii) requires TV licensees to prepare and place in their public files a Children’s Television Programming Report for each calendar quarter showing, among other things, the efforts made during that three-month period to serve the educational and informational needs of children.  In addition, Subsection 73.3526(e)(11)(i) requires TV licensees to place in their public file, on a quarterly basis, an Issues/Programs List that details programs that have provided the station’s most significant treatment of community issues during the preceding quarter.  Also, Subsection 73.3526(e)(17) requires each Class A television station to include in its public file documentation sufficient to demonstrate that it continues to meet the Class A eligibility requirements as set forth in Section 73.6001.

On May 28, 2014, the licensee filed its station’s license renewal application. In the process of evaluating the application, FCC staff found that the licensee indicated the station was off-air in its Children’s Television Reports and Issues/Programs Lists for two quarters during which it was on the air for a portion of the quarter, and for two quarters during which the station did not have Special Temporary Authorization (“STA”) to go off-air.  In addition, the station failed to prepare any Class A certifications during its license term, which began in the third quarter of 2009.

The licensee explained that it had mistakenly indicated that the station was off-air in the Children’s Television Reports and Issues/Programs Lists filed for the last three quarters of 2010 because its compliance official mistook the station’s engineering STA for an STA to go off-air. With regard to the first quarter 2012 reports, the licensee explained that the compliance official mistook another station’s STA to go off-air for this station’s STA.

To resolve the investigation, the licensee admitted to the violations and agreed to pay an $18,000 fine. The licensee also agreed to a two-year compliance plan, which directs the licensee to institute management checks, training, and other measures designed to prevent a re-occurrence of the violations.   Despite the imposition of a fine and compliance plan, the FCC renewed the station’s license, finding that the licensee met the minimum qualifications to hold an FCC license, and that grant of the license renewal application was in the public interest.

FCC Proposes $9,000 Fine for FM Translator Licensee Based on False Certification and Unauthorized Operation Violations

The FCC’s Media Bureau proposed to fine a Texas FM translator licensee $9,000 for falsely certifying in a license application that its translator was constructed as specified in its construction permit, and for operating the translator at variance from its license. The FCC also admonished the licensee for including incorrect information in a related application.

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December 2015

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:

  • FM Licensee and Prospective Buyer Agree to Jointly Pay $8,000 for Unauthorized Transfer of Control
  • TV Licensee Faces $13,000 Fine for Children’s Programming and Public Inspection File Violations
  • Late License Renewal Applicant Escapes With $1,500 Fine

Licensee Admits Time Brokerage Agreement Improperly Ceded Control of Station

The FCC’s Media Bureau entered into a Consent Decree with a Colorado FM broadcast licensee and a company seeking to acquire the station. The decree resolved an investigation into whether the licensee violated the FCC’s Rules by ceding control of key station responsibilities to a company through a Time Brokerage Agreement (“TBA”).

Section 310(d) of the Communications Act and Section 73.3540 of the FCC’s Rules prohibit voluntary assignments or transfers of control of broadcast licenses without the consent of the FCC. The Consent Decree noted that TBAs are not precluded by any FCC rule or policy, provided that licensees remain in compliance with the ownership rules and maintain ultimate control over their facilities. The Consent Decree explained that a licensee maintains such control when it holds ultimate responsibility for essential station matters such as programming, personnel, and finances.

The licensee and company entered into a TBA in 1992, and in 2006 the company assigned its rights under the agreement to an affiliated corporate entity. On April 23, 2015, the licensee and company jointly filed an application to assign the station’s license to the company, initiating the FCC’s investigation into the TBA.

The FCC concluded that the TBA effected an unauthorized transfer of control of the station license. Specifically, the TBA improperly delegated core licensee financial responsibilities by allowing an affiliated corporate entity of the broker to directly pay for certain station obligations and expenses, including a debt owed to a third party, site rent, and the bill for the station’s telephone service.

To resolve the investigation, the licensee and the company stipulated that they had each violated Section 310(d) of the Communications Act and Section 73.3540 of the FCC’s Rules, and agreed to collectively pay an $8,000 fine. In exchange, the FCC indicated it would grant the assignment application subject to full and timely payment of the fine and the absence of any other violations that would preclude such a grant.

FCC Proposes $13,000 Fine for Children’s Programming and Public Inspection File Violations

The FCC’s Media Bureau proposed a $13,000 fine for a Texas TV station for failing to properly identify children’s programming with an “E/I” symbol onscreen, and for several public inspection file violations. Additionally, the FCC admonished the licensee for its failure to upload required documents to the online public inspection file.

The Children’s Television Act requires TV stations to offer programming that meets the educational and informational needs of children, which the FCC calls “Core Programming.” Section 73.671 of the FCC’s Rules requires licensees to, among other things, display an “E/I” symbol to identify such content. Continue reading →

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November 2015

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 TV Licensee for Prior Station Owner’s Failure to Timely File Children’s Television Programming Reports
  • Inadequate Antenna Fencing and Signage Result in Proposed Fines of $60,000 and $25,000 for Two Broadband-PCS Licensees
  • Cable Company Settles Data Breach Investigation for $595,000

You Can’t Leave Your Troubles Behind: FCC Clarifies That Prior Violations Transfer Along with TV Station

The FCC’s Video Division admonished a New York TV licensee whose station failed to file Children’s Television Programming Reports in a timely manner for thirteen quarters between 2006 and 2010. The licensee acquired control of the station through a long-form transfer of control consummated in September 2010.

Section 73.3526 of the FCC’s Rules requires each commercial broadcast licensee to maintain a public inspection file containing specific information related to station operations. Subsection 73.3526(e)(11)(iii) requires TV licensees to prepare and place in their public inspection files a Children’s Television Programming Report for each calendar quarter showing, among other things, the efforts made during that three-month period to serve the educational and informational needs of children.

In 2011, the FCC sent a letter to the licensee requesting that the licensee provide information concerning missing Children’s Television Programming Reports between 2006 and 2010. In response, the licensee explained that some of the missing reports had actually been filed under a “–FM” call sign, instead of the licensee’s “–CA” call sign, and admitted that the others had not been filed. The FCC later notified the licensee’s counsel that it had concluded its investigation into the Children’s Television Reports at issue in its 2011 letter, and did not impose a fine or other penalty for the violations at that time.

The violations resurfaced, however, after the station’s license renewal application filing in 2015 triggered an FCC review of the station’s online public inspection file. The FCC issued a Notice of Apparent Liability for Forfeiture to the licensee, proposing a $15,000 fine for its failure to timely file the 2006-2010 Children’s Television Programming Reports. The licensee argued that (i) the FCC had previously investigated the station’s public file and deemed it in compliance, and (ii) the licensee was not responsible for untimely report violations of the station’s prior owner, noting “existing regulations and a consistent line of published decisions and notices” to that effect. In particular, the licensee cited Section 73.3526(d) of the FCC’s Rules, which provides that “[i]f the assignment is consented to by the FCC and consummated, the assignee shall maintain the file commencing with the date on which notice of the consummation of the assignment is filed with the FCC.”

As even the licensee acknowledged, however, “assignments and transfers are dealt with in separate sub-sections of the rule, and the language about the limited responsibility of a new owner appears only in the assignment subsection.” On that basis, the FCC rejected the licensee’s argument, explaining that “[b]ecause the Licensee remains the same after a transfer of control, as a legal matter, liability remains with the licensee.”

Nevertheless, the FCC concluded that the licensee “had reason to believe it was in compliance at the time it submitted its license renewal application because it had filed previously missing reports in 2011 and 2013.” It therefore exercised its discretion to cancel the proposed fine and instead issue an admonishment. The FCC warned, however, that it would not rule out more severe sanctions for similar violations in the future, noting that the FCC takes the timely filing of Children’s Television Programming Reports “very seriously.”

Broadband-PCS Licensees Face Fines for Exposing the Public to Excessive Radiofrequency Levels

The FCC’s Enforcement Bureau proposed $60,000 and $25,000 fines against two broadband-PCS licensees for inadequate warning signs and fencing surrounding certain antennas in Phoenix, resulting in unprotected areas that exceeded what is permissible radiofrequency (“RF”) exposure for the general public. The violations were discovered on the same day as a result of a complaint from the owner of a nearby office building. Continue reading →

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September 2015

The next Children’s Television Programming Report must be filed with the FCC and placed in stations’ public inspection files by October 10, 2015, reflecting programming aired during the months of July, August, and September 2015.

Statutory and Regulatory Requirements

As a result of the Children’s Television Act of 1990 (“Act”) and the FCC rules adopted under the Act, full power and Class A television stations are required, among other things, to: (1) limit the amount of commercial matter aired during programs originally produced and broadcast for an audience of children 12 years of age and under, and (2) air programming responsive to the educational and informational needs of children 16 years of age and under.

These two obligations, in turn, require broadcasters to comply with two paperwork requirements. Specifically, stations must: (1) place in their online public inspection file one of four prescribed types of documentation demonstrating compliance with the commercial limits in children’s television, and (2) submit FCC Form 398, which requests information regarding the educational and informational programming the station has aired for children 16 years of age and under. Form 398 must be filed electronically with the FCC. The FCC automatically places the electronically filed Form 398 filings into the respective station’s online public inspection file. However, each station should confirm that has occurred to ensure that its online public inspection file is complete. The base fine for noncompliance with the requirements of the FCC’s Children’s Television Programming Rule is $10,000.

Noncommercial Educational Television Stations

Because noncommercial educational television stations are precluded from airing commercials, the commercial limitation rules do not apply to such stations. Accordingly, noncommercial television stations have no obligation to place commercial limits documentation in their public inspection files. Similarly, though noncommercial stations are required to air programming responsive to the educational and informational needs of children 16 years of age and under, they do not need to complete FCC Form 398. They must, however, maintain records of their own in the event their performance is challenged at license renewal time. In the face of such a challenge, a noncommercial station will be required to have documentation available that demonstrates its efforts to meet the needs of children.

Commercial Television Stations

Commercial Limitations

The Commission’s rules require that stations limit the amount of “commercial matter” appearing in children’s programs to 12 minutes per clock hour on weekdays and 10.5 minutes per clock hour on the weekend. In addition to commercial spots, website addresses displayed during children’s programming and promotional material must comply with a four-part test or they will be considered “commercial matter” and counted against the commercial time limits. In addition, the content of some websites whose addresses are displayed during programming or promotional material are subject to host-selling limitations. Program promos also qualify as “commercial matter” unless they promote children’s educational/informational programming or other age-appropriate programming appearing on the same channel. Licensees must prepare supporting documents to demonstrate compliance with these limits on a quarterly basis.

For commercial stations, proof of compliance with these commercial limitations must be placed in the online public inspection file by the tenth day of the calendar quarter following the quarter during which the commercials were aired. Consequently, this proof of compliance should be placed in your online public inspection file by October 10, 2015, covering programming aired during the months of July, August, and September 2015.

Documentation to show that the station has been complying with this requirement can be maintained in several different forms:

  • Stations may, but are not obligated to, keep program logs in order to comply with the commercial limits rules. If the logs are kept to satisfy the documentation requirement, they must be placed in the station’s public inspection file. The logs should be reviewed by responsible station officials to be sure they reflect compliance with both the numerical and content requirements contained in the rules.
  • Tapes of children’s programs will also satisfy the rules, provided they are placed in the station’s public inspection file and are available for viewing by those who visit the station to examine the public inspection file. The FCC has not addressed how this approach can be utilized since the advent of online public inspection files.
  • A station may create lists of the number of commercial minutes per hour aired during identified children’s programs. The lists should be reviewed on a routine basis by responsible station officials to be sure they reflect compliance with both the numerical and content requirements contained in the rule.
  • The station and its network/syndicators may certify that as a standard practice, they format and air the identified children’s programs so as to comply with the statutory limit on commercial matter, and provide a detailed listing of any instances of noncompliance. Again, the certification should be reviewed on a routine basis by responsible station officials to ensure that it is accurate and that the station did not preempt programming or take other action that might affect the accuracy of the network/syndicator certification.

Regardless of the method a station uses to show compliance with the commercial limits, it must identify the specific programs that it believes are subject to the rules, and must list any instances of noncompliance. As noted above, commercial limits apply only to programs originally produced and broadcast primarily for an audience of children ages 12 and under.

Programming Requirements

To assist stations in identifying which programs qualify as “educational and informational” for children 16 years of age and under, and determining how much of that programming they must air to comply with the Act, the Commission has adopted a definition of “core” educational and informational programming, as well as license renewal processing guidelines regarding the amount of core educational programming aired.

The FCC defines “core programming” as television programming that has as a significant purpose serving the educational and informational needs of children 16 years old or under, which is at least 30 minutes in length, and which is aired weekly on a regular basis between 7:00 a.m. and 10:00 p.m. Each core program must be identified by an E/I symbol displayed throughout the program. In addition, the licensee must provide information identifying each core program that it airs, including an indication of the program’s target child audience, to publishers of program guides. The licensee must also publicize the existence and location of the station’s children’s television reports in the public inspection file. The FCC has not prescribed a specific manner of publicizing this information, but enforcement actions indicate that the FCC expects the effort to include an on-air component. We suggest placing an announcement on the station website and periodically running on-air announcements.

Under the current license renewal processing guidelines, stations must air an average of at least three hours of “core programming” each week during the quarter in order to receive staff-level approval of the children’s programming portion of the station’s license renewal application. Stations that air “somewhat less” than an average of three hours per week of “core programming,” i.e., two and one-half hours, may still receive staff-level approval of their renewals if they show that they aired a package of programming that demonstrates a commitment at least equivalent to airing three hours of “core programming” per week. Stations failing to meet one of these guidelines will have their license renewal applications reviewed by the full Commission for compliance with the Children’s Television Act.

FCC Form 398 is designed to provide the public and the Commission with the information necessary to determine compliance with the license renewal processing guidelines. The report captures information regarding the preemption of children’s programming, and requires stations to create an addendum to the form called a “Preemption Report” which provides information on: (1) the date of each preemption; (2) if the program was rescheduled, the date and time the rescheduled program aired; (3) the reason for the preemption; and (4) whether promotional efforts were made to notify the public of the time and date that the rescheduled program would air.

Filing of FCC Form 398

Form 398 must be filed electronically on a quarterly basis. As a result, full power and Class A television stations should file a Form 398 electronically with the FCC by October 10, 2015.

Preparation of the Programming Documentation

In preparing the necessary documentation to demonstrate compliance with the children’s television rules, a station should keep the following in mind:

  • FCC Form 398 and documentation concerning commercialization will be very important “evidence” of the station’s compliance when the station’s license renewal application is filed; preparation of these documents should be done carefully.
  • Accurate and complete records of what programs were used to meet the educational and informational needs of children and what programs aired that were specifically designed for particular age groups should be preserved so that the job of completing the FCC Form 398 and creating documentation concerning commercialization is made easier.
  • A station should prepare all documentation in time for it to be placed in the public inspection file by the due date. If the deadline is not met, the station should give the true date when the information was placed in the file and explain its lateness. A station should avoid creating the appearance that it was timely filed when it was not.

These are only a few ideas as to how stations can make complying with the children’s television requirements easier. Please do not hesitate to contact the attorneys in the Communications Practice for specific advice on compliance with these rules or for assistance in preparing any of this documentation.

Class A Television Stations Only

Although not directly related to the requirement that Class A stations file children’s programming reports, it is important to note that Class A stations must certify that they continue to meet the FCC’s eligibility and service requirements for Class A television status under Section 73.6001 of the FCC’s Rules. While the relevant subsection of the public inspection file rule, Section 73.3526(e)(17), does not specifically state when this certification should be prepared and placed in the public inspection file, we believe that since Section 73.6001 assesses compliance on a quarterly basis, the prudent course for Class A television stations is to place the Class A certification in the public inspection file on a quarterly basis as well.

A PDF of this article can be found at 2015 Third Quarter Children’s Television Programming Documentation.

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September 2015

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 TV Station Licensees for Violating Commercial Limits in Children’s Programming
  • Telecommunications Provider Agrees to $1.175 Million Payment to Resolve Investigation of 911 Call Failures
  • Pirate Radio Operator’s Repeated Disregard for the Rules Results in $15,000 Proposed Fine

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July 2015

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:

  • Repetitive Children’s Programming Costs TV Licensee $90,000
  • It’s Nice to Be Asked: FCC Faults Red-Lighted Licensee’s Failure to Request STA
  • FCC Proposes $25,000 Fine for Hogging Shared Frequencies

“Repeat” Offender: Children’s Programming Reports Violations Cost Licensee $90,000

A licensee of several full power and Class A TV stations in Florida and South Carolina paid $90,000 to resolve an FCC investigation into violations of the Children’s Television Act (CTA) threatening to hold up its stations’ license renewal grants.

The CTA, as implemented by Section 73.671 of the FCC’s Rules, requires full power TV licensees to provide sufficient programming designed to serve the educational and informational needs of children, known as “Core programming”, and Section 73.6026 extends this requirement to Class A licensees. The FCC’s license renewal application processing guideline directs Media Bureau staff to approve the CTA portion of any license renewal application where the licensee shows that it has aired an average of 3 hours per week of Core programming. Staff can also approve the CTA portion of a license renewal application where the licensee demonstrates that it has aired a package of different types of educational and informational programming, that, even if less than 3 hours of Core programming per week, shows a level of commitment to educating and informing children equivalent to airing 3 hours per week of Core programming. Applications that do not satisfy the processing guidelines are referred to the full Commission, where the licensee will have a chance to prove its compliance with the CTA.

Among the seven criteria the FCC has established for evaluating whether a program qualifies as Core programming is the requirement that the program be a regularly scheduled program. The FCC has explained that regularly scheduled programming reinforces lessons from episode to episode and “can develop a theme which enhances the impact of the educational and informational message.” With this goal in mind, the FCC has stressed that the CTA intends for regularly scheduled programming to be comprised of different episodes of the same program, not repeats of a single-episode special.

Applying this criteria to each of the licensee’s 2012 and 2013 license renewal applications, the FCC staff questioned whether certain programming listed in the Children’s Television Programming Reports for the stations complied with the episodic program requirement. In particular, the staff looked at single-episode specials that the licensee counted repeatedly for the purpose of demonstrating the number of Core programs aired during each quarter—for example, the licensee listed one single-episode special as being aired 39 times in one quarter. After determining that it could not clear the renewal applications under the FCC’s processing guidelines, the staff referred the matter to the full Commission for review.

The FCC and the licensee subsequently negotiated the terms of a consent decree to resolve the CTA issues raised by the Media Bureau. Under the terms of the consent decree, the licensee agreed to make a $90,000 voluntary contribution to the U.S. Treasury. The licensee also agreed to enact a plan to ensure future compliance with the CTA, to be reflected in each station’s Quarterly Children’s Television Programming Reports. In light of the consent decree and after reviewing the record, the FCC concluded that the licensee had the basic qualifications to be an FCC licensee and ultimately granted each station’s license renewal application.

FCC Clarifies “Red Light” Policy Is a Barrier to Grants, Not a Road Block to Filing Requests

An Indiana radio licensee faces a $15,000 fine for failing to retain all required documentation in its station’s public inspection file and for suspending operation of the station without receiving special temporary authority (STA) to do so.

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April 2015

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 Scuttles New York Pirate Radio Operator and Proposes $20,000 Fine
  • Failure to Properly Identify Children’s Programming Results in $3,000 Fine
  • Telecommunications Carrier Consents to Pay $16 Million To Resolve 911 Outage Investigation

Fire in the Hole: FCC Proposes $20,000 Fine Against Pirate Radio Operator

This month, the FCC proposed a fine of $20,000 against an individual in Queens, NY for operating a pirate FM radio station. Section 301 of the Communications Act prohibits the unlicensed use or operation of any apparatus for the transmission of communications or signals by radio. Pirate radio operations can interfere with and pose illegal competitive harm to licensed broadcasters, and impede the FCC’s ability to manage radio spectrum.

The FCC sent several warning shots across the bow of the operator, noting that pirate radio broadcasts are illegal. None, however, deterred the individual from continuing to operate his unlicensed station. On May 29, 2014, agents from the Enforcement Bureau’s New York Office responded to complaints of unauthorized operations and traced the source of radio transmissions to an apartment building in Queens. The agents spoke with the landlord, who identified the man that set the equipment up in the building’s basement. According to FCC records, no authorization had been issued to the man, or anyone else, to operate an FM broadcast station at or near the building. After the man admitted that he owned and installed the equipment, the agents issued a Notice of Unlicensed Operation and verbally warned him to cease operations or face significant fines. The man did not respond to the notice.

Not long after, on January 13, 2015, New York agents responded to additional complaints of unlicensed operations on the same frequency and traced the source of the transmissions to another multi-family dwelling in Queens. The agents heard the station playing advertisements and identifying itself with the same name the man had used during his previous unlicensed operations. Again, the agents issued a Notice of Unlicensed Operation and ordered the man to cease operations, and again he did not respond.

The FCC therefore concluded it had sufficient evidence that the man willfully and repeatedly violated Section 301 of the Communications Act, and that his unauthorized operation of a pirate FM station warranted a significant fine. The FCC’s Rules establish a base fine of $10,000 for unlicensed operation of a radio station, but because the man had ignored multiple warnings, the FCC doubled the base amount, resulting in a proposed fine of $20,000.

FCC Rejects Licensee’s Improper “E/I” Waiver Request and Issues $3,000 Fine

A California TV licensee received a $3,000 fine this month for failing to properly identify children’s programming with an “E/I” symbol on the screen. The Children’s Television Act (“CTA”) requires TV licensees to offer programming that meets the educational and informational needs of children, known as “Core Programming.” Section 73.671 of the FCC’s Rules requires licensees to satisfy certain criteria to demonstrate compliance with the CTA; for example, broadcasters are required to provide specific information to the public about the children’s programming they air, such as displaying the “E/I” symbol to identify Core Programing. Continue reading →

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March 2015

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:

  • Deceptive Practices Yield Multi-Million Dollar Fines for Telephone Interexchange Carriers
  • LPFM Ads Cost $16,000
  • Multiple TV Station Licensees Face $6,000 Fines for Failing to File Children’s TV Programming Reports

Interexchange Carriers’ “Slamming” and “Cramming” Violations Yield Over $16 Million in Fines

Earlier this month, the FCC imposed a $7.62 million fine against one interexchange carrier and proposed a $9 million fine against another for changing the carriers of consumers without their authorization, commonly known as “slamming,” and placing unauthorized charges for service on consumers’ telephone bills, a practice known as “cramming.” Both companies also fabricated audio recordings and submitted the recordings to the FCC, consumers, and state regulatory officials as “proof” that consumers had authorized the companies to switch their long distance carrier and charge them for service when in fact the consumers had never spoken to the companies or agreed to the service.

Section 258 of the Communications Act and Section 64.1120 of the FCC’s Rules make it unlawful for any telecommunications service carrier to submit or execute a change in a subscriber’s selection of telephone exchange service or telecommunications service provider except with prior authorization from the consumer and in accordance with the FCC’s verification procedures. Additionally, Section 201(b) of the Communications Act requires that “all charges, practices, classifications, and regulations for and in connection with [interstate or foreign] communications service [by wire or radio], shall be just and reasonable.” The FCC has found that any assessment of unauthorized charges on a telephone bill for a telecommunications service is an “unjust and unreasonable” practice under Section 201(b), regardless of whether the “crammed” charge is placed on consumers’ local telephone bills by a third party or by the customer’s carrier.

Further, the submission of false and misleading evidence to the FCC violates Section 1.17 of the FCC’s Rules, which states that no person shall “provide material factual information that is incorrect or omit material information . . . without a reasonable basis for believing that any such material factual statement is correct and not misleading.” The FCC has also held that a company’s fabrication of audio recordings associated with its “customers” to make it appear as if the consumers had authorized the company to be their preferred carrier, and thus charge it for service, is a deceptive and fraudulent practice that violates Section 201(b)’s “just and reasonable” mandate.

In the cases at issue, the companies failed to obtain authorization from consumers to switch their carriers and subsequently placed unauthorized charges on consumers’ bills. The FCC found that instead of obtaining the appropriate authorization or even attempting to follow the required verification procedures, the companies created false audio recordings to mislead consumers and regulatory officials into believing that they had received the appropriate authorizations. One consumer who called to investigate suspect charges on her bill was told that her husband authorized them–but her husband had been dead for seven years. Another person was told that her father–who lives on another continent–requested the change in service provider. Other consumers’ “verifications” were given in Spanish even though they did not speak Spanish on the phone and therefore would not have completed any such verification in Spanish. With respect to one of the companies, the FCC remarked that “there was no evidence in the record to show that [the company] had completed a single authentic verification recording for any of the complainants.”

The FCC’s forfeiture guidelines permit the FCC to impose a base fine of $40,000 for “slamming” violations and FCC case law has established a base fine of $40,000 for “cramming” violations as well. Finding that each unlawful request to change service providers and each unauthorized charge constituted a separate and distinct violation, the FCC calculated a base fine of $3.24 million for one company and $4 million for the other. Taking into account the repeated and egregious nature of the violations, the FCC found that significant upward adjustments were warranted–resulting in a $7.62 million fine for the first company and a proposed $9 million fine for the second.

Investigation Into Commercials Aired on LPFM Station Ends With $16,000 Civil Penalty

Late last month, the FCC entered into a consent decree with the licensee of a West Virginia low power FM radio station to terminate an investigation into whether the licensee violated the FCC’s underwriting laws by broadcasting announcements promoting the products, services, or businesses of its financial contributors.

LPFM stations, as noncommercial broadcasters, are allowed to broadcast announcements that identify and thank their sponsors, but Section 399b(b)(2) of the Communications Act and Sections 73.801 and 73.503(d) of the FCC’s Rules prohibit such stations from broadcasting advertisements. The FCC has explained that the rules are intended to protect the public’s use and enjoyment of commercial-free broadcasts in spectrum that is reserved for noncommercial broadcasters that benefit from reduced regulatory fees.

The FCC had received multiple complaints alleging that from August 2010 to October 2010, the licensee’s station broadcast advertisements in violation of the FCC’s noncommercial underwriting rules. Accordingly, the FCC sent a letter of inquiry to the licensee. In its response, the licensee admitted that the broadcasts violated the FCC’s underwriting rules. The licensee subsequently agreed to pay a civil penalty of $16,000, an amount the FCC indicated reflected the licensee’s successful showing of financial hardship. In addition, the licensee agreed to implement a three-year compliance plan, including annual reporting requirements, to ensure no future violations of the FCC’s underwriting rules by the station will occur.

Failure to “Think of the Children” Leads to $6,000 Fines

Three TV licensees are facing $6,000 fines for failing to timely file with the FCC their Form 398 Children’s Television Programming Reports. Section 73.3526 of the FCC’s Rules requires each commercial broadcast licensee to maintain a public inspection file containing specific information related to station operations. Subsection 73.3526(e)(11)(iii) requires a commercial licensee to prepare and place in its public inspection file a Children’s Television Programming Report on FCC Form 398 for each calendar quarter. The report sets forth the efforts the station made during that quarter and has planned for the next quarter to serve the educational and informational needs of children. Licensees are required to file the reports with the FCC and place them in their public files by the tenth day of the month following the quarter, and to publicize the existence and location of those reports.

This month, the FCC took enforcement action against two TV licensees in California and one TV licensee in Ohio for Form 398 filing violations. The first California licensee failed to timely file its reports for two quarters, the second California licensee failed to file its reports for five quarters, and the Ohio licensee failed to file its reports for eight quarters. Each licensee also failed to report these violations in its license renewal application, as required under Section 73.3514(a) of the Rules. Additionally, the Ohio licensee failed to timely file its license renewal application (in violation of Section 73.3539(a) of the Rules), engaged in unauthorized operation of its station after its authorization expired (in violation of Section 301 of the Communications Act), and failed to timely file its biennial ownership reports (in violation of Section 73.3615(a) of the Rules).

Despite the variation in the scope of the violations, each licensee now faces an identical $6,000 fine. The FCC originally contemplated a $16,000 fine against the Ohio licensee, as its guidelines specify a base forfeiture of $10,000 for unauthorized operation alone. However, after assessing the licensee’s gross revenue over the past three years, the FCC determined that a reduction of $10,000 was appropriate, resulting in the third $6,000 fine.

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

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March 2015
The next Children’s Television Programming Report must be filed with the FCC and placed in stations’ public inspection files by April 10, 2015, reflecting programming aired during the months of January, February and March 2015.

Statutory and Regulatory Requirements

As a result of the Children’s Television Act of 1990 (“Act”) and the FCC rules adopted under the Act, full power and Class A television stations are required, among other things, to: (1) limit the amount of commercial matter aired during programs originally produced and broadcast for an audience of children 12 years of age and under, and (2) air programming responsive to the educational and informational needs of children 16 years of age and under.

These two obligations, in turn, require broadcasters to comply with two paperwork requirements. Specifically, stations must: (1) place in their online public inspection file one of four prescribed types of documentation demonstrating compliance with the commercial limits in children’s television, and (2) submit FCC Form 398, which requests information regarding the educational and informational programming the station has aired for children 16 years of age and under. Form 398 must be filed electronically with the FCC. The FCC automatically places the electronically filed Form 398 filings into the respective station’s online public inspection file. However, each station should confirm that has occurred to ensure that its online public inspection file is complete. The base fine for noncompliance with the requirements of the FCC’s Children’s Television Programming Rule is $10,000.
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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.
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