Articles Posted in FCC Enforcement

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Pillsbury’s communications lawyers have published the 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:

  • Massachusetts Man Ordered to Cease Using Interfering Home TV Antenna
  • Unauthorized Transfers of Arkansas Radio Stations Lead to $8,000 Consent Decree
  • STIR/SHAKEN Rule Violations End With $1,000,000 Consent Decree

Interference From Home TV Antenna Moves FCC to Action

The FCC’s Enforcement Bureau recently issued a Notification of Harmful Interference (Notification) directing a Massachusetts man to cease using an indoor digital TV antenna in his home.

Over a two-day period in April 2024, an agent of the FCC’s Boston field office investigated an interference complaint.  The agent determined that unauthorized radio emissions in the 813-817 MHz band were interfering with the Massachusetts State Police public safety communications system.  The agent ultimately tracked the interference to an indoor digital TV antenna located in a condominium.  His suspicions were confirmed when the interference ceased after the device was unplugged.

The Communications Act of 1934 requires devices operating on certain frequencies, including the 800 MHz band, to be licensed by the FCC.  Section 15.5(b) of the FCC’s Rules creates a limited exception to this restriction for low power devices where no harmful interference is caused.  Section 15.3(m) defines harmful interference as “[a]ny emission, radiation or induction that endangers the functioning of a radio navigation service or of other safety services or seriously degrades, obstructs or repeatedly interrupts a radiocommunications service….”

In September 2024, the Bureau sent a Notification warning to the condominium owner that the TV antenna was causing harmful interference in violation of FCC rules, and should he continue to operate it, he would be subject to severe penalties, including fines, seizure of the equipment, or even imprisonment.

The Notification directed the resident to respond to the FCC within 10 days to describe his operation of the antenna and the steps being taken to ensure no further interference is caused.  The FCC indicated it would then determine what enforcement action is warranted to ensure no future violations occur.

Unauthorized Transfers of Control of Arkansas Radio Stations Net $8,000 Consent Decree

The licensee of an AM station and three FM stations in Arkansas failed to obtain required FCC approvals before transferring the licensee’s voting stock from one trust to another, and then transferring a 50% controlling interest in the licensee from the second trust to an individual.  To resolve the investigation, the licensee entered into a Consent Decree with the FCC’s Media Bureau which required, among other things, payment of an $8,000 civil penalty. Continue reading →

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Pillsbury’s communications lawyers have published the 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:

  • Florida Radio Station Faces $14,000 Proposed Fine for Contest Rule Violations
  • $6,500 Fines Targeted at Mississippi and Tennessee FM Translators for Late-Filed License Renewal Applications and Unauthorized Operation
  • FCC Continues Focus on Collecting Unpaid Regulatory Fees from Broadcasters

FCC Fines Florida Radio Station for Contest Rule Violations

The FCC proposed to fine a radio broadcaster $14,000 for violating the Commission’s Contest Rule while conducting a multi-station contest.  Specifically, the FCC issued a Notice of Apparent Liability for Forfeiture (NAL) asserting that the broadcaster failed to select and/or notify contest winners in a timely fashion, as required by the licensee’s announced contest terms.

Section 73.1216 of the FCC’s Rules requires a licensee to “fully and accurately disclose the material terms” of a contest it broadcasts or promotes and to conduct the contest “substantially as announced and advertised.”  Material terms include, among other things, eligibility restrictions, the time and means of selecting winners, and the extent, nature, and value of prizes.  Prizes must be awarded promptly, and the FCC has consistently found violations where stations failed to award prizes in accordance with the announced contest terms.

In April 2021, the FCC received a complaint alleging that one of the licensee’s radio stations had not conducted a contest in a manner “substantially as announced and advertised.”  The Enforcement Bureau issued a Letter of Inquiry (LOI) to the licensee in August 2021.  In its November 2021 response, the licensee explained that during the first half of 2021, it had conducted a nationwide contest on 194 of its stations.  During the contest, each participating station announced a contest “keyword” once an hour, for eleven hours each day, for 27 days.  Listeners could qualify to win by submitting this keyword via text message or the internet before the end of the hour in which the word was announced.  One national winner would then be picked each hour from across all stations, creating 297 winners (11 per day x 27 days).  The prize was a $1,000 check and winners were to be notified within 72 hours, according to contest terms.

Upon review, the licensee discovered that as a result of human error, the contest had not been conducted according to the announced contest terms.  In its LOI response, the licensee disclosed that (1) the part-time employee tasked with randomly selecting a national winner from among those qualified sometimes failed to do so; (2) the part-time employee’s manager did not provide supervision to confirm winners were selected; and (3) some winners were never notified they had been selected.  Ultimately, 50 winners out of 297 were not timely selected and/or notified.  After receiving the LOI but before submitting its response to the FCC, the licensee selected and notified 50 “replacement” winners.

The licensee argued that its actions did not amount to a violation of the rules because (1) an insubstantial number of winners that were not timely selected/notified compared to the total number of winners; (2) the contest terms only required the licensee to select “a total of up to, but not more than,” 297 verified winners; (3) it was not done intentionally, but was merely the “poor performance of two employees” that caused the selection/notification failures; and (4) the licensee went to “great lengths” to mitigate the selection/notification failures, eventually awarding prizes to all “winners” who completed the required paperwork. Continue reading →

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Pillsbury’s communications lawyers have published the 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:

  • Failure to Pay Annual Regulatory Fees Trips Up Texas AM Radio Licensee
  • Communications Provider for Deaf and Hard of Hearing Consumers Resolves Investigation with Multimillion Dollar Consent Decree
  • Investigation into Unauthorized Transfer of Control of Colorado Radio Stations Leads to $3,400 Fine

License of Texas AM Station Could Be Revoked If Regulatory Fees Remain Unpaid

The licensee of a Texas AM station must either pay its overdue regulatory fees or demonstrate why the fees are inapplicable or should be waived or deferred.  According to the Federal Communications Commission’s records, the radio station currently owes unpaid regulatory fees exceeding $3,000.  The fees were originally due on September 30, 2022, and the outstanding amount continues to accrue interest and other charges until it is paid in full.

Under Section 9 of the Communications Act of 1934 and Section 1.1151 of the FCC’s Rules, the FCC has the authority to assess annual fees to cover its operational costs.  These fees are typically due in late September to ensure the agency is fully funded at the start of the federal government’s fiscal year in October.  Late payment of these fees incurs a 25% penalty plus interest.  If licensees fail to pay regulatory fees and any penalties or interest, the FCC may revoke their affected licenses and other authorizations.

Prior to issuing an Order to Pay or to Show Cause, the FCC sent a demand letter to the licensee.  When payment was not received, the Commission transferred the debt to the U.S. Department of Treasury.  Subsequently, the FCC requested the return of the matter from the Treasury Department in order to pursue further collection efforts.

The Order demands that within 60 days the licensee either pay the full outstanding debt or demonstrate why the fee is inapplicable or should be waived or deferred.  The Media Bureau noted in the Order that failing to provide evidence of payment or to demonstrate why the fee isn’t applicable by the 60-day deadline could result in revocation of the station’s license. Continue reading →

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The Federal Communications Commission (FCC) last week warned 13 property owners in the New York City area that illegal FM radio broadcasts were emanating from their properties, and that they could face multimillion-dollar fines if the transmissions do not promptly cease.

To operate a broadcast station, the Communications Act of 1934 and the FCC’s rules require an FCC license. Those operating illegally are commonly referred to as “pirate” operators. These operations are frequently the target of FCC enforcement actions as they can, among other things, interfere with FCC-licensed broadcasts and disrupt emergency communications.

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Pillsbury’s communications lawyers have published the 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:

  • Louisiana TV Station Admonished for Lack of Non-Discrimination Clause in Advertising Contracts
  • $25,000 Fine for a Variety of Rule Violations by Florida Low Power FM Station Affirmed
  • FCC Proposes $367,436 Fine for Marketing Violations Involving WiFi Devices

FCC Media Bureau Admonishes TV Station for Lack of Non-Discrimination Clause in Advertising Contracts

The FCC’s Media Bureau admonished a Louisiana TV station for failing to include a non-discrimination clause in its advertising sales contracts.  While it stopped short of issuing a fine, the Bureau warned that future violations could result in harsher sanctions.

Since 2008, the FCC has required commercial radio and television stations to include explicit non-discrimination clauses in their ad sales contracts.  To ensure compliance, the FCC revised its broadcast license renewal application form in 2011 to require commercial broadcasters to certify that their ad sales contracts contain a non-discrimination clause making clear to advertisers that the station will not accept advertising placed with an intent to discriminate on the basis of race or ethnicity.  If a licensee is unable to certify compliance, the FCC requires an attachment to the license renewal application explaining the circumstances and why such non-compliance should not be considered an obstacle to the station’s license renewal.

The TV station responded “No” to the non-discrimination certification in its license renewal application, noting that its advertising agreements did not contain a non-discrimination clause.  The station indicated, however, that it does not permit discrimination in its ad sales and that it would add a non-discrimination clause to its ad sales contracts going forward.

In light of the absence of any evidence that the station had actually engaged in discriminatory ad sales, the Media Bureau admonished the station, granted its license renewal application, and warned that any future violations could trigger fines or more severe sanctions.

While enforcement actions involving the FCC’s advertising non-discrimination requirements are uncommon, that is because most stations are able to make the necessary certification in their license renewal application.  Radio and television broadcasters should examine their advertising contracts to ensure they contain the necessary language and that their stations have in fact been meeting their obligation to prevent discrimination by race or ethnicity in advertising sales.

FCC Enforcement Bureau Denies Petition to Reconsider $25,000 LPFM Fine

The FCC Enforcement Bureau denied a Petition for Reconsideration filed by the licensee of a Florida low power FM radio station, finding unpersuasive the licensee’s argument that a $25,000 fine should be cancelled due to the licensee’s inability to pay.

A 2022 Forfeiture Order concluded that the licensee failed to: (1) operate the station according to the parameters of its license and the FCC’s rules; (2) make the station available for inspection by FCC field agents; and (3) properly maintain Emergency Alert System (EAS) equipment. Continue reading →

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Pillsbury’s communications lawyers have published the 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 Issues Six Notices of Apparent Liability to Pirate Radio Operators Across Massachusetts
  • Affordable Connectivity Program Provider Faces $8 Million Fine and Removal from the Program
  • FCC Proposes $3,000 Fine Against Massachusetts Class A Television Station for Public File Issues

FCC Targets Pirate Radio Operators in the Boston Area

The Communications Act prohibits the transmission of radio signals without prior FCC authorization because such signals can interfere with licensed communications and pose a danger to the public by interfering with licensed stations that carry public safety messages, including Emergency Alert System transmissions.  Over the past few years, the FCC has been focusing more attention on the owners and operators of illegal broadcast radio (colloquially known as “pirate radio”) facilities, targeting several in New York (as we discussed here and here) and Florida (as discussed here).  Last month, it issued six Notices of Apparent Liability for Forfeiture (NAL) proposing fines against Massachusetts pirate radio operators under the Preventing Illegal Radio Abuse Through Enforcement Act (PIRATE Act).  The PIRATE Act gave the FCC enhanced enforcement authority against radio pirates and has led to the recent increase in such fines.

In the Massachusetts NALs, the FCC proposed fines of $597,775, $120,000, $40,000, $40,000, $40,000, and $20,000, respectively, against the six pirate radio operators.

With regard to the largest proposed fine—$597,775—the FCC noted in the NAL that the facility’s owner had a long history of unauthorized operation.  In 2004, FCC field agents traced radio transmissions to a residence in Randolph, MA.  The transmissions exceeded the power limits for operation under Part 15 of the FCC’s Rules, which permits use of certain low power radio frequency devices without an FCC license.

Over the years, FCC field agents issued verbal and written warnings to cease pirate operations, but the self-admitted owner/operator repeatedly failed to do so.  In early 2005, agents found him to be transmitting above the Part 15 power limits, resulting in a $10,000 fine in 2006.  In 2017, acting on a complaint, FCC agents took field strength measurements of a new signal connected with the same operator and found it also exceeded the limits for unlicensed operation, resulting in the agents issuing an on-scene Notice of Unlicensed Operation.

Then, over the course of five days during June and July 2023, agents traced unauthorized radio transmissions to three locations in Brockton, Mattapan, and Randolph, MA.  After taking field strength measurements, the agents determined that all three facilities exceeded the power limits for operation under Part 15 of the FCC’s Rules.  Further investigation confirmed no authorizations had been issued for operation of an FM broadcast station at or near any of the three locations, and that the same owner/operator was connected to all three pirate sites.

In the NAL against this operator, the FCC concluded that he willfully and knowingly violated the Communications Act by operating a pirate radio station, and proposed the base fine for pirate operation ($20,000) for each of the five days of observed illegal activity, which would have resulted in a total proposed fine of $100,000.  Given the operator’s history of warnings and prior violations, however, the FCC found that an upward adjustment was warranted, and it proposed the maximum permissible penalty—$119,555—for each of the five instances of operation, leading to a proposed total fine of $597,775.  The operator has thirty days to either pay the fine or file a request presenting grounds for its reduction or cancellation.

FCC Alleges Wireless Company Violated Affordable Connectivity Program Rules and Federal Wire Fraud Statute

The FCC issued an NAL and Order Initiating Removal Proceeding to a wireless company and its principal for apparently willfully and repeatedly violating the FCC’s Rules for the Affordable Connectivity Program (ACP) and the federal wire fraud statute.  The NAL proposes an $8,083,992 joint fine against the company and its principal. Continue reading →

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Pillsbury’s communications lawyers have published the 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 Proposes $8,000 Fine for Contest Rule Violations
  • Business Communications Company Settles Business Radio Investigation by Agreeing to Compliance Plan and $100,000 Penalty
  • FCC Issues $16,500 Fine to Alabama FM Translator for Multiple Rule Violations

California FM Station Receives $8,000 Proposed Fine for Contest Rule Violation

The FCC proposed a fine of $8,000 against the licensee of a California FM radio station for violating the FCC’s Contest Rule.  Specifically, the FCC issued a Notice of Apparent Liability for Forfeiture (NAL) asserting that the licensee failed to conduct the contest substantially as announced.

Section 73.1216 of the FCC’s Rules requires a licensee to “fully and accurately disclose the material terms” of a contest it conducts or promotes and to conduct the contest “substantially as announced and advertised.”  Material terms include, among other things, eligibility restrictions, the means of selecting winners, and the extent, nature, and value of prizes.  Prizes must also be awarded promptly, and in the past the FCC has found Contest Rule violations where a station failed to award prizes in a manner consistent with the advertised rules.

The FCC received a complaint alleging that the station did not award a cash prize to the winner of a contest conducted in October 2019.  To investigate the complaint, the FCC issued a Letter of Inquiry (LOI) to the station.  In response, the station admitted that there had been “undue delay,” with the prize being awarded after the announced timeline.  The station’s contest rules indicated prizes were to be awarded to winners “within thirty (30) business days of the date the winner completes all required Station documents.”  The station acknowledged that it received all required documentation on January 16, 2020, and thus it should have issued the prize by March 2, 2020, but did not issue the prize until May 2021.  The station cited three separate events as the cause of the undue delay: (1) difficulty accessing necessary files after the COVID-19 pandemic led to employees working from home; (2) a ransomware attack that affected corporate IT systems between October 2020 and March 2021; and (3) a lack of staff after the ransomware attack that prevented the station from completing work in a timely manner.

Despite these defenses, the FCC found that the station apparently willfully violated Section 73.1216 of the FCC’s Rules when it failed to award the prize in accordance with the advertised contest rules, and therefore failed to conduct the contest “fairly and substantially as represented to the public.”  The FCC explained that “timely fulfillment of the prize” was a “material term of the Licensee’s own contest rules” and the station delayed issuing the prize for over a year.  The FCC disagreed with the station’s justifications for the delay, finding that they did not excuse the failure to award the prize in compliance with the announced contest rules.  In particular, the FCC pointed out that the station’s first justification for the delay (the pandemic transition to work-from-home) occurred in mid-March 2020 – after the station should have already issued the prize by March 2, 2020.

The FCC’s base fine for violations pertaining to licensee-conducted contests is $4,000.  In this case, the FCC found a single violation of Section 73.1216 of the FCC’s Rules resulting from the station’s failure to issue the prize within the timeframe established by the contest rules.  However, considering the totality of the circumstances, and in line with the FCC’s Forfeiture Policy Statement, the FCC determined an upward adjustment was warranted, emphasizing that “large or highly profitable companies should expect to pay higher forfeitures for violations of the Act and the Commission’s rules” to ensure that the fine is an “effective deterrent and not simply a cost of doing business.”  The FCC therefore concluded that an upward adjustment of the proposed fine from $4,000 to $8,000 was appropriate.  The station has 30 days from release of the NAL to pay the fine or file a written statement seeking reduction or cancellation of it.

Rule Violations by Business Communications Company Result in Consent Decree with Compliance Plan and Six-Figure Penalty

A nationwide business communications company settled an FCC investigation by admitting that it failed to seek approval from the FCC before transferring control of business radio licenses and that it conducted business radio operations without authorization.  The company entered into a consent decree that requires implementation of a compliance plan and payment of a $100,000 civil penalty. Continue reading →

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Pillsbury’s communications lawyers have published the 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:

  • Maine LPTV Licensee Agrees to Pay $2,500 for Closed-Captioning Violation
  • Georgia Broadcaster Loses FM Translator License, Faces Five-Figure Fine for Various Alleged Rule Violations
  • FCC Proposes $9,500 Fine for Missouri LPTV Licensee for Failing to File License Application and Renew Special Temporary Authority

Low Power Television Licensee Enters Into Consent Decree for Closed Captioning Violation

The Federal Communications Commission’s Enforcement Bureau and the licensee of a low power television station entered into a Consent Decree to resolve an investigation into whether the licensee violated the FCC’s Rules pertaining to closed captioning of video programming.  Under the Consent Decree, the licensee admitted to violating the FCC’s closed captioning rules, agreed to implement a compliance plan, and pay a $2,500 penalty.

The FCC’s closed captioning rules are designed to ensure that individuals with hearing disabilities have full access to video programming content.  The FCC’s Rules, among other things, require Video Programming Distributors to: (1) pass video programming with closed captioning to viewers with the original closed captioning data intact; (2) maintain their equipment and monitor their signal transmissions to ensure the closed captioning is reaching viewers; and (3) maintain records of their maintenance and monitoring activities.

In June 2021, a cable subscriber noticed that the station’s programming did not contain closed captioning and contacted their cable provider.  The cable provider told the viewer that the signal from the station did not contain closed captioning, so the viewer contacted the station directly in July 2021.  The station explained that it was getting new equipment which would fix the closed captioning problem, but after three months, the closed captioning was still missing from the programming.  After no further response from the station, the viewer filed a complaint with the FCC in October 2021.  Despite telling the FCC in November 2021 that it had identified the problem and was working to replace the deficient equipment, the licensee failed to timely respond to a December 2021 Letter of Inquiry (LOI) from the FCC.  A second LOI was issued in April 2022, prompting the licensee to respond in part to both LOIs.

After an investigation, the FCC determined that the licensee had failed to pass through closed captioning on its programming for a total of eight months.  Additionally, the FCC found that the licensee was not fully responsive to the viewer’s complaint or the FCC’s LOIs during the investigation, in violation of Section 1.17 of the Commission’s Rules.

To resolve the investigation, the licensee agreed to enter into a Consent Decree under which it will designate a compliance officer, implement a multi-part compliance plan, including implementing procedures to monitor its transmissions, routinely conduct equipment checks, and pay a $2,500 civil penalty.  The Consent Decree also indicates that in the event the licensee fails to comply with the requirements to monitor its transmissions and conduct equipment checks, it will pay an additional $12,500 civil penalty.

 Variety of Alleged Rule Violations by Georgia AM Station Generate Proposed $16,200 Fine and License Cancellation for Its FM Translator

A Georgia broadcaster faces a Notice of Apparent Liability for Forfeiture (NAL) and a $16,200 fine for several alleged FCC rule violations, including operating a full-power AM radio station at variance from its license, discontinuing operation of the station without notifying the FCC or obtaining FCC authorization to do so, transferring control of the station and its FM translator to another party without FCC authorization, and failing to completely and fully respond to FCC inquiries.  The FCC also found that the translator’s license had automatically terminated after the translator failed to operate from its authorized location for more than a year. Continue reading →

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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:

  • New Hampshire Presidential Primary Deepfake Robocalls Lead to Enforcement Action Against Call Originator
  • TV Broadcaster Faces $720,000 Fine for Failure to Negotiate Retransmission Consent in Good Faith
  • Statutory Maximum Penalty of $2,391,097 for Pirate Radio Operator

Telecommunications Company Accused of Originating Illegal Robocalls That Used President Biden’s Voice

A Michigan-based telecommunications company received a Notice of Suspected Illegal Traffic (“Notice”) from the FCC’s Enforcement Bureau accusing it of originating illegal robocall traffic related to the New Hampshire Presidential Primary election.

Two days before voting began in the Primary, New Hampshire residents believed to be potential Democratic voters began receiving calls purportedly from President Joe Biden telling them to “save” their vote for the November general election and not vote in the Primary.  The caller ID information indicated the call came from the spouse of a former state Democratic Party chair who was running a super PAC urging state Democrats to write in President Biden’s name in the Primary.  The call was not authorized by President Biden or his campaign or an authorized committee, nor did it include a legitimate message from the president but instead was a so-called deepfake using the President’s voice.  The caller ID information was spoofed.

Following widespread news reporting of the calls, the FCC investigated the matter together with the New Hampshire Attorney General, the Anti-Robocall Multistate Litigation Task Force and USTelecom’s Industry Traceback Group (“ITG”).  This group determined that the telecommunications company was the originating provider of the robocalls at issue, and the ITG provided identifying call data to the company for the suspect calls.  In response, the company identified another entity as the party that initiated the calls and told the ITG that it had warned the initiating entity as to the illegality of the calls.  According to the Notice, both the company and the apparent initiating entity have been previous subjects of illegal robocall investigations.

It is illegal under federal law to “knowingly transmit misleading or inaccurate caller identification information with the intent to defraud, cause harm, or wrongfully obtain anything of value” and the law requires originating providers to protect their networks by taking “affirmative, effective measures to prevent new and renewing customers from using its network to originate illegal calls, including knowing its customers and exercising due diligence in ensuring that its services are not used to originate illegal traffic.”  Failure by a provider to protect its network can lead to downstream providers permanently blocking all of the upstream provider’s traffic.  In this case, the FCC believed the caller knowingly transmitted misleading and inaccurate caller ID information to deceive and confuse call recipients and apparently intended to harm prospective voters by using the President’s voice to tell them to not participate in the Primary.  The company also signed the calls with A-Level Attestation, an authentication designation that signals to downstream providers that the company has a direct relationship with the customer and that the customer legitimately controls the phone number in the caller ID field.

Transmittal of the Notice triggered several obligations for the company, including that it investigate the illegal traffic identified by the FCC and block or cease accepting all of the illegal traffic within 14 days of the Notice if the company’s investigation determines that it was part of the call chain for the identified traffic or substantially similar traffic.  Failure to respond to the Notice or to comply with additional obligations could result in temporary or permanent blocking of all traffic from the company, removal of the company from the Robocall Mitigation Database, which would cause all intermediate and terminating providers to immediately cease accepting the company’s telephone traffic, and more.  The FCC also issued a Public Notice notifying all U.S.-based voice service providers of the suspected illegal traffic coming from the company and authorizing the providers, at their discretion, to block or cease accepting traffic from the company without liability under the Communications Act of 1934 if the company failed to effectively mitigate the illegal calls. Continue reading →

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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:

  • TV Broadcaster Faces $150,000 Fine for Failure to Negotiate Retransmission Consent in Good Faith
  • Sponsorship ID and Political File Violations Lead to $500,000 Consent Decree for Radio Broadcaster
  • $26,000 Fine for Georgia Radio Station EEO Rule Violations

 FCC Finds That TV Broadcaster Failed to Negotiate Retransmission Consent in Good Faith

Responding to a complaint by a cable TV provider, the Federal Communications Commission found that a broadcaster failed to negotiate retransmission consent for its New York TV station in good faith.  The enforcement action involves a Notice of Apparent Liability for Forfeiture (NAL) proposing a $150,000 fine against the broadcast licensee.  The licensee was represented in the negotiations by another broadcaster who provides services to the station at issue.

Under Section 325 of the Communications Act of 1934, as amended (the Act), TV stations and multichannel video programming distributors (i.e., cable and satellite TV providers) have a duty to negotiate retransmission consent agreements in good faith.  In a 2000 Order, the FCC adopted rules relating to good faith negotiations, setting out procedures for parties to allege violations of the rules.  The Order established a two-part good faith negotiation test.  Part one of the test is a list of objective negotiation standards, the violation of any of which is deemed to be a per se violation of a party’s duty to negotiate in good faith.  Part two of the test is a subjective “totality of the circumstances” test in which the FCC reviews the facts presented in a complaint to determine if the combined facts establish an overall failure to negotiate in good faith.

In this case, the cable provider complained that the broadcaster, through its negotiator, proposed terms for renewal of the parties’ agreement that would have prohibited either party from filing certain complaints with the FCC after execution of the agreement.  For its part, the broadcaster did not dispute that it proposed the terms in question, but argued that (1) “releasing FCC-related claims or withdrawing FCC complaints is not novel,” (2) “parties typically agree to withdraw good faith negotiation complaints once retransmission consent agreements have been reached,” and (3) no violation could have occurred since the proposed term was not included in the final agreement reached.

The FCC disagreed, stating that its 2000 Order made clear that proposing terms which foreclose the filing of FCC complaints is a presumptive violation of the good faith negotiation rules.  The FCC also disagreed with the broadcaster’s contention that terms not included in a final agreement could not violate the good faith rules.  Finally, while the licensee argued that it was not responsible for actions taken by the party negotiating on its behalf, the FCC reiterated that licensees are responsible for the actions of their agents, and the licensee in this case delegated negotiation of the agreement to its agent.

Relying upon statutory authority and its Forfeiture Policy Statement, the FCC arrived at a proposed fine of $150,000.  The Forfeiture Policy Statement establishes a base fine of $7,500 for violating the cable broadcast carriage rules, and the FCC asserted that the alleged violations continued for 10 days (the time period from first proposing the terms at issue and the signing of the agreement without them), yielding a base fine of $75,000.  The FCC then exercised its discretion to upwardly adjust the proposed fine to $150,000, asserting that the increase was justified based on the licensee’s financial relationship with a large TV company, its prior rule violations, and the FCC’s view that a larger fine was necessary to serve as a meaningful deterrent against future violations.

Repeated Violations of Sponsorship ID and Political File Rules Lead to $500,000 Consent Decree

A large radio station group entered into a consent decree with the FCC’s Media Bureau, agreeing to pay a $500,000 civil penalty for two of its stations’ violations of sponsorship identification laws and the Political File rule.

Section 317(a)(1) of the Act and Section 73.1212(a) of the FCC’s Rules require broadcast stations to identify the sponsor of any sponsored content broadcast on the station.  This requirement applies to all advertising, music, and any other broadcast content if the station or its employees received something of value for airing it.  The FCC has said that the sponsorship identification laws are “grounded in the principle that listeners and viewers are entitled to know who seeks to persuade them . . . .” Continue reading →