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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:

  • Big-4 Network, Among Others, Settles With FCC Over Emergency Alert Tone Violations
  • Despite Self-Disclosure, Sponsorship ID Violations Land $233,000 Proposed Fine
  • Topeka TV Licensee Enters Into Consent Decree Over Late-Filed KidVid Reports

False Alarm: FCC Enters Into Multiple Consent Decrees Over Emergency Alert Tone Violations

In a single day last week, the FCC announced four separate Consent Decrees in response to unauthorized uses of the Emergency Alert System (“EAS”) tone across various media outlets.  The parent companies of a Big-4 broadcast network and two cable channels, as well as the licensee of two southern California FM stations, each agreed to significant payments to settle investigations into violations of the FCC’s EAS rules.  According to the Consent Decrees, unauthorized emergency tones have reached hundreds of millions of Americans in the past two years alone.

The Emergency Alert System is a nationwide warning system operated by the FCC and the Federal Emergency Management Agency that allows authorized public agencies to alert the public about urgent situations, including natural disasters and other incidents that require immediate attention.  Once the system is activated, television and radio broadcasters, cable television operators, and other EAS “participants” begin transmitting emergency messages with distinct attention tones.  These tones consist of coded signals that are embedded with information about the emergency and are capable of activating emergency equipment.  Wireless Emergency Alerts (“WEA”), which deliver messages to the public via mobile phones and other wireless devices, also use attention signals.

Emergency tones may not be transmitted except in cases of: (1) actual emergencies; (2) official tests of the emergency system; and (3) authorized public service announcements.  In an accompanying Enforcement Advisory published on the same day as the Consent Decrees, the FCC’s Enforcement Bureau noted that wrongful use of the tones can result in false activations of the EAS, as well as “alert fatigue,” in which “the public becomes desensitized to the alerts, leading people to ignore potentially life-saving warnings and information.”

For the Big-4 network, it all started with a joke.  Around the time of last year’s nationwide EAS test, a late-night network talk show parodied the test in a sketch that incorporated emergency tones.  According to the Consent Decree, the network’s programming reaches almost all US television households through hundreds of local television affiliates, as well as through the network’s owned and operated stations.  Shortly after the episode aired, the company removed the offending portions of the program from its website and other streaming sites and did not rebroadcast the episode.  Despite these remedial actions, the damage was already done; in response to the Enforcement Bureau’s investigation, the network’s parent company agreed to pay a $395,000 “civil penalty.”

The parent companies of two major cable channels entered into similar agreements.  In one instance from this past year, an episode of a popular show set in a zombie-infested post-apocalyptic world used simulated EAS tones on multiple occasions over the course of an hour.  That episode was transmitted on eight separate occasions over a two-month period.  According to the Consent Decree, within weeks of the episode’s debut, the Enforcement Bureau reached out to the network regarding the unauthorized uses of the tone and, after a brief investigation, the network’s parent company agreed to pay $104,000 to resolve the matter. Continue reading →

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The FCC has released its finalized schedule of annual Regulatory Fees for Fiscal Year 2019, and thanks to the collective efforts of all 50 State Broadcasters Associations and the National Association of Broadcasters, there is some good news for radio stations and satellite television stations.

But before we get to that, some information for you from the FCC’s Public Notice released today on filing requirements.  Fees will be due by 11:59 p.m. EDT on September 24, 2019.  You must file via the FCC’s Fee Filer system, which is available for use now.  You may pay online via credit card or debit card, or submit payment via Automated Clearing House (ACH) or wire transfer.  Remember that $24,999.99 is the daily maximum that can be charged to a credit card in the Fee Filer system.  As a result, many stations may have to pay their fees using the other methods.

Television broadcast stations will see an unfamiliar number in the “Quantity” box when they go to pay.  This relates to the FCC’s phase-in of a population-based methodology for calculating television station fee amounts.  It cannot be changed and should not be a cause for concern.  Regulatees whose total fee amount is $1,000 or less are once again exempt and do not need to pay.

In most years, the outcome of the annual Regulatory Fee battle ends with the FCC’s various regulatees rolling their collective eyes and murmuring “just tell me how much I have to fork over.”  This year’s Regulatory Fee proceeding had some surprises, however.  When the proposed fee amounts were first announced, they contained a dramatic increase in year-over-year fee amounts for most categories of radio stations.  Yet, the reason for this sudden increase was neither addressed by the FCC nor readily apparent from the FCC’s brain-numbing summary of its calculation process.

In response, all 50 State Broadcasters Associations and the NAB filed comments pressing the FCC to revisit its fee methodology and to explain or correct what appeared to be flawed data used to calculate broadcast Regulatory Fee amounts.  In particular, they pressed the FCC to explain why the estimated number of radio stations slated to cover radio’s share of the FCC’s budget had inexplicably plummeted between 2018 and 2019, resulting in each individual station having to shoulder a significantly higher fee burden.

In its regulatory fee Order, the Commission acknowledged that its estimate of the number of radio stations that would be paying Regulatory Fees in 2019 had been “conservative”, and failed to include 553 of the nation’s commercial radio stations.  Once these stations were added to the total number of radio stations previously anticipated to pay Regulatory Fees, the impact was to reduce individual station fees from those originally proposed by 9% to 13%, depending on the class of radio station.

This adjustment prevented what would have otherwise been a roughly $3 million dollar overpayment by radio stations nationwide, significantly exceeding the FCC’s cost of regulating radio stations in FY 2019.  The fact that the FCC listened to the concerns of broadcasters, investigated the discrepancy between 2019 station data and that of prior years, and made appropriate changes to fix the problem, is heartening, particularly given that stations’ only options are paying the fees demanded, seeking a waiver, or turning in their license.

Terrestrial satellite TV stations also received a requested correction to their fee calculations.  As noted above, the FCC is transitioning from a DMA-based fee calculation methodology to a population-based methodology for TV stations.  To phase in this new methodology, the Commission proposed to average each station’s historical and population-based Regulatory Fee amounts and use that average for FY 2019 before moving to a fully population-based fee in FY 2020.

In calculating the average of the “old” and “new” fees, however, the FCC neglected to use the reduced fee amount historically paid by TV satellite stations, which is much lower than that paid by non-satellite TV stations in the same DMA.  As a result, a TV satellite station might have seen its 2019 fees jump by tens of thousand of dollars over FY 2018, only to see them drop again in FY 2020.  The FCC acknowledged that its intent in adopting the phase-in was not to unduly burden TV satellite stations in FY 2019, and it therefore recalculated those fees using the lower historical fee amounts traditionally applied to such stations.

While these reductions are a rare win against ever-increasing regulatory fees, there remain big picture issues that Congress and the FCC need to address in the longer term.  Significant among these is the FCC’s reliance on collecting the fees that support its operations from the licensees it regulates (a burden not a benefit), while charging no fees to those that rely on the FCC’s rulemakings to launch new technologies on unlicensed spectrum or obtain rights against other private parties via the FCC’s rulemaking processes (a benefit not a burden).  Such a narrow approach to funding the FCC makes little sense, particularly where it unduly burdens broadcasters, who, unlike most other regulatees, have no ability to just pass those fees on to consumers as a line item on a bill.

We live in a time of disruption.  Disruption affects all areas of the economy, but surely the most affected has to be the communications sector.  If any government agency can claim to be the regulator of this disruption, it must surely be the FCC.  Yet despite the FCC’s position at the forefront of these changes, its Regulatory Fee process is mired in a system in which broadcasters are left holding the bag for more than 35% of the FCC’s operating budget (once again, burden not benefit).  Even as the FCC spends more of its time and resources on rulemakings, economic analysis, and technical studies surrounding new technologies and new entrants into the communications sector whose main goal is to nibble away at broadcasters’ spectrum, audience, and revenue, it still collects regulatory fees only from the licensees and regulatees of its four “core” bureaus – the International Bureau, Wireless Telecommunications Bureau, Wireline Competition Bureau, and Media Bureau.  It’s an old formula, and it no longer works.

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Twelve large telecom companies and the attorneys general of 50 states and the District of Columbia announced yesterday an agreement on eight voluntary principles that the companies will adopt to combat illegal and unwanted robocalls.  The announcement comes as regulators, telecom companies, and legislators continue to grapple with a worsening robocall problem that has become a significant concern for consumers, generating more complaints at the Federal Communications Commission and the Federal Trade Commission than any other topic.

Both the Senate and House have passed robocall bills that have yet to be reconciled to produce a bill both houses of Congress can agree upon.  In the meantime, the states are attempting to take the lead by working with telecom companies to establish what are effectively best practices.  These include:

  1. Making available free call-blocking and labeling tools to customers, and implementing free call blocking at the network level (network-level call blocking does not require any action from the consumer).
  2. Implementing STIR/SHAKEN, a technology used to provide authentication that calls are coming from a valid source.
  3. Monitoring network traffic for patterns consistent with robocalls.
  4. Investigating suspicious calls and calling patterns by, for example, initiating a traceback investigation or verifying that the commercial customer owns or is authorized to use the Caller ID number.
  5. Confirming the identity of new commercial VoIP customers by collecting information such as physical location.
  6. Requiring other telephone companies with which they contract to cooperate in identifying the source of suspected illegal robocalls.
  7. Working with law enforcement to trace robocalls by identifying a single point of contact for traceback requests, and responding to such requests as soon as possible.
  8. Communicating with state attorneys general to keep them apprised of trends in illegal robocalling and potential additional solutions to combat such robocalls.

For context and information on other recent actions taken to combat illegal and unwanted robocalls, read our post from June, where we discussed the FCC’s decision to permit voice service providers to implement call-blocking programs for subscribers on an opt-out basis.  Robocalling finally appears to have achieved the status of Public Enemy Number One, with Congress, states, and federal agencies all working to block the flood of calls inundating the public.

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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:

  • Pennsylvania AM Station’s “Shenanigans” in Connection With Tower Violations Lead to $25,000 Fine
  • Georgia and North Carolina Radio Station Licenses at Risk Due to Unpaid Fees
  • FCC Cites New Jersey Vehicle Equipment Vendor for Programming Transmitters with Unauthorized Frequencies

Pennsylvania Station’s Tower “Shenanigans” Lead to $25,000 Fine

In a recent Forfeiture Order, the FCC fined a Pennsylvania AM radio licensee for various tower-related violations after the licensee failed to sufficiently respond to a 2016 Notice of Apparent Liability for Forfeiture (NAL).

Broadcasters must comply with various FCC and FAA rules relating to registration, lighting and painting requirements.  In particular, they must be lit and painted in compliance with FAA requirements, and any extinguished or improperly functioning lights must be reported to the FAA if the problem is not corrected within 30 minutes.  The FCC’s Rules require lighting repairs to be made “as soon as practicable.”

In 2015, FCC Enforcement Bureau agents responded to an anonymous complaint regarding a pair of radio towers.  Over multiple site visits, the agents determined that multiple mandatory tower lights and beacons were unlit and that the towers’ paint was chipping and faded to such a degree that the towers did not have good visibility.  In connection with the lighting problems, the licensee had also failed to timely file the required “Notice to Airmen” with the FAA, which informs aircraft pilots of potential hazards along their flight route.  The FCC cited these issues in a February 2016 Notice of Violation sent to the station.  The licensee responded by assuring the FCC that it would immediately undertake remedial actions.  However, a site visit from the FCC several months later revealed continuing violations, and the FCC subsequently issued the $25,000 NAL along with directions on how to respond.

At that point, the licensee’s woes expanded from substantive to procedural.  According to a Forfeiture Order, the licensee failed to file a “proper response” to the NAL.  Instead, in a bizarre series of events that the FCC chalked up to “shenanigans,” it noted that the licensee submitted a Petition for Reconsideration of the NAL, as well as a response to the NAL to the Office of Managing Director (OMD), instead of to the Enforcement Bureau.  OMD is a separate department within the FCC that deals with agency administrative matters, such as budgets, human resources, scheduling, and document distribution.  OMD subsequently returned the Petition and the NAL response to the licensee with a letter noting the licensee’s procedural misstep.

The licensee’s “shenanigans” were still far from over, however.  More than a month after OMD returned the licensee’s submissions, the licensee sent a letter to the Enforcement Bureau seeking to arrange an installment plan for the $25,000 proposed fine.  This, too, was procedurally flawed, as the NAL specifically explained that any requests for payment plans must be directed to the FCC’s Chief Financial Officer, not to the Enforcement Bureau.  Though the Enforcement Bureau itself forwarded the request to the CFO’s office, no plan was ever put in place.

According to the Forfeiture Order, despite the licensee’s various filings, it failed to successfully submit a response to the NAL to the Enforcement Bureau.  The Forfeiture Order also noted that even had the licensee’s NAL response been sent to the Enforcement Bureau (instead of OMD), it would have been defective for being late-filed.  The Enforcement Bureau therefore affirmed the proposed fine and ordered the licensee to pay the $25,000 fine within 30 days.

Pay to Play: FCC Initiates Proceedings Against North Carolina and Georgia Radio Stations Over Delinquent Fees

In a pair of Orders to Pay or to Show Cause released on the same day, the FCC began proceedings to potentially revoke the AM radio license of a Georgia station and the FM radio license of a North Carolina station. Continue reading →

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As we noted in last week’s post, television stations eligible to file 2018 distant signal copyright royalty claims with the United States Copyright Royalty Board must do so by July 31, 2019.  While that due date still seems far away (especially to those accustomed to the FCC’s real-time electronic filing options) we remind filers to build in extra time well ahead of the end of the month.

Prior to filing electronically, eligible stations (i.e. stations with locally-produced programming whose signals were carried by at least one cable system located outside the station’s local service area or by a satellite provider that provided service to at least one viewer outside the station’s local service area during 2018) or their representatives must first request to register for an account with the Copyright Royalty Board’s online filing system (“eCRB”).  After submitting an initial registration request, filers should expect to wait at least 1-2 business days before receiving a verification email allowing them to activate their eCRB account.  Only then can filers begin submitting claims electronically.  As a result, e-filers who expect to register on July 31 or even the day or two leading up to that date will almost certainly miss the filing window.  To complicate matters further, July 27-28 is a weekend, which will not count toward the registration wait time.

To avoid missing the filing cutoff, our recommendation for e-filing should come as no surprise to longtime readers: register and file as soon as possible!  Claimants that are unable to file electronically must adhere to the Copyright Royalty Board’s strict delivery rules, which include a narrow daily window for hand delivery and prohibit the use of overnight delivery services like FedEx.  As a result, the best bet is to submit a registration request today and file electronically no later than Monday, July 29, leaving room to file a physical copy should the need arise for any reason.

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The availability of broadband Internet service in apartment buildings, condominiums, and office buildings, or what the FCC calls multiple tenant environments (MTE), was the subject of a Notice of Proposed Rulemaking (NPRM) and Declaratory Ruling released on Friday of last week. Prior FCC decisions have attempted to strike a balance between promoting competitive access to tenants and preserving adequate incentives for the initial service providers to deploy, maintain, and upgrade infrastructure. For example, the Commission prohibits cable providers and telecommunications carriers from entering into contracts with MTEs that grant a single provider exclusive access to the MTE, but permits exclusive marketing agreements.

Continue reading →

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At its July 2019 Open Meeting this week, the FCC voted to make several changes to its Children’s Television Programming rules.  It released its final Order adopting the changes this afternoon.  Although characterized by Commissioner O’Rielly as “modest” changes, the revised rules are likely to alter television broadcasters’ compliance efforts in several significant respects, including the time at which the programming is aired, the type of programming that qualifies as educational, and how a broadcaster demonstrates compliance with the revised rules.

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:

  • Investigation Into Undisclosed Radio Station Owner With a History of Felonies Leads to Hearing Designation Order
  • FCC Settles With Alaskan Broadcaster After Disastrous Station Inspection
  • FCC Reinstates Licenses for Tennessee and Alabama Radio Stations, Then Immediately Threatens to Revoke Them

Continue reading →

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For many consumers, answering a phone call from an unknown number has effectively turned into a gamble. Is it a potential new client? A medical emergency? Or, more likely, is it an incredible offer-to-stay-at-a-Caribbean-resort-of-your-choosing-please-hold-for-a-representative?

Not surprisingly, no issue generates more complaints at the Federal Communications Commission (FCC) and the Federal Trade Commission than robocalls – according to one estimate there were 47 billion illegal and unwanted calls in 2018. In response, the FCC last week released a Declaratory Ruling and Third Further Notice of Proposed Rulemaking (CG Docket No. 17-59, WC Docket No. 17-97) clarifying that voice service providers may offer consumers call-blocking tools through an opt-out process rather than an opt-in basis, as is typically done today. The FCC issued this clarification to address concerns that the majority of consumers are not requesting available call-blocking services.

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:

  • FCC Settles With Golf Club Operator Over Unauthorized Transfer of 108 Private Wireless Licenses
  • FCC Warns Traffic Management Company Over Unlicensed Radio Operations
  • Months-Long Tower Lighting Outage Leads to Warning

Continue reading →