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Assessing the Impact on Radio and Television Stations of the Federal Trade Commission’s Recently Revised Guidance on Endorsements and Testimonials
November 2009
On December 1, 2009, the FTC’s newly-revised Guides on Endorsements and Testimonials will become effective. Broadcasters, including their on-air talent, need to know when a claim is an endorsement/testimonial, what on-air disclosures may be required, and what their obligations are to ensure that claims are truthful and not misleading. These endorsement/testimonial-related issues can arise in a variety of contexts, including when station personnel voice commercials, prepare copy for advertisers, engage in banter regarding a product or service, serve as a spokesperson for an advertiser, or provide content to their station websites.
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Commercial Radio and Television Stations Given Until January 11, 2010 to File Their Biennial Ownership Reports on FCC Form 323
November 2009
In a Public Notice released by the FCC today, the Media Bureau has announced that it has extended to January 11, 2010, the prior December 15, 2009 deadline for commercial radio and television broadcast station licensees to file their Biennial Ownership Reports on revised FCC Form 323.
This announcement comes as a great relief to licensees of commercial broadcast stations given that the electronic version of revised FCC Form 323 is not yet available on the FCC’s CDBS system for uploading of data.
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Annual DTV Ancillary/Supplementary Services Report for Commercial Digital Television Stations
November 2009
All commercial and noncommercial educational digital television broadcast station licensees and permittees must file FCC Form 317 to report whether their stations provided ancillary or supplemental services at any time during the twelve-month period ending on the preceding September 30. The FCC Form 317 is due by December 1, 2009. Electronic filing of FCC Form 317 is mandatory. Paper versions will not be accepted for filing unless accompanied by an appropriate request for waiver.
Ancillary or supplementary services are all services provided on the portion of a DTV station’s digital spectrum capacity or bitstream that is not necessary to provide the required single free, over-the-air signal to viewers. Thus, any video broadcast signal provided at no direct charge to viewers is exempt. According to the FCC, examples of services that are considered ancillary or supplementary include, but are not limited to, “computer software distribution, data transmissions, teletext, interactive materials, aural messages, paging services, audio signals, subscription video, and the like.”
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Ninth Circuit Ruling Leads to Spike in Class Actions Over Text Messages from Retailers
11/11/2009
In Satterfield v. Simon & Schuster, Inc., 569 F.3d 946 (9th Cir. 2009), the Ninth Circuit held that unsolicited text messages to mobile phones sent by a retailer may constitute a “call” in violation of the Telephone Consumer Protection Act (the “TCPA”). This decision has sparked an increase in consumer class actions filed against retailers who send advertisements to consumers by text message.
The TCPA makes it unlawful “to make any call” using an automatic telephone dialing system (“ATDS”) to, among other things, a mobile telephone or pager. 47 U.S.C. Section 227(b)(1)(A). Congress enacted the TCPA in 1991, before text messaging was available, and intended it to prohibit automated voice calls from telemarketers to mobile phones. The U.S. Court of Appeals for the Ninth Circuit, in Satterfield v. Simon & Schuster, Inc., 569 F.3d 946 (9th Cir. 2009), extended this consumer protection to text calls made using ATDSs.
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Broadcast Station EEO Advisory
November 2009
This Broadcast Station EEO Advisory is directed to radio and television stations licensed to communities in: Alabama, Colorado, Connecticut, Georgia, Maine, Massachusetts, Minnesota, Montana, New Hampshire, North Dakota, Rhode Island, South Dakota and Vermont, and highlights the upcoming deadlines for compliance with the FCC’s EEO Rule.
Introduction
December 1, 2009 is the deadline for broadcast stations licensed to communities in the States/Territories referenced above to place their Annual EEO Public File Report in their public inspection files and post the report on their website, if they have one.
Under the FCC’s EEO rule, all radio and television station employment units (“SEUs”), regardless of staff size, must afford equal employment opportunity to all qualified persons and practice nondiscrimination in employment.
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FCC Shifts Net Neutrality Debate into High Gear
10/28/2009
Last week the FCC launched a Notice of Proposed Rulemaking (NPRM) proposing to adopt six “open Internet” rules that would bind all broadband access providers, including those providing mobile and satellite broadband services. If adopted, the rules could have pervasive and lasting effects in many industry sectors, including broadband, voice and video service providers, infrastructure, device, chipset and other component vendors, content publishers and distributors, software publishers, and application service providers.
The NPRM abandons the “net neutrality” moniker in favor of a new phrase, “the free and open Internet.” Nonetheless, views on every aspect of the debate remain highly polarized, driven by vast economic stakes in the outcome, disagreements about the factors that have made the Internet a success, philosophical differences about the nature of the Internet and disagreement over the role of the FCC in 21st century communications. The NPRM puts the FCC at center stage in the debate for now, but the federal courts and Congress may take prominent or even decisive roles. Some parties, notably including two of the five sitting FCC commissioners, question the FCC’s legal authority to adopt and enforce the rules it has proposed. If the federal courts agree, the FCC will have to re-tool its approach or look to Congress to expand its jurisdiction.
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FCC Announces Filing Freeze for FM Minor Change Applications and Allotment Petitions and Creates Filing Window for Noncommercial Educational FM New Station Construction Permits
10/16/2009
The FCC issued two Public Notices today which, together: (1) impose a freeze on the filing of all FM commercial and noncommercial educational (“NCE”) minor change applications from 11:59 pm, November 25, 2009, through December 18, 2009; (2) impose a freeze, beginning today, October 16, 2009, through December 18, 2009, on any applications proposing to modify the reference coordinates of 67 vacant non-reserved FM Band allotments listed on Attachment A of the Public Notice (attached hereto), as well as on any petitions or counterproposals that propose a change in the channel, class, community, or reference coordinates of those allotments; and (3) create a filing window for applications for those 67 vacant FM allotments reserved for NCE use.
With respect to the NCE filing window, the FCC announced that it will accept applications for the vacant 67 NCE FM allotments on Channels 221 through 300 from Friday, December 11, 2009, until Friday, December 18, 2009.
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FTC Updates Guidance on Endorsements and Testimonials in Advertising
10/15/2009
On October 5, 2009, the Federal Trade Commission announced that it finalized the update to its Guides Concerning the Use of Endorsements and Testimonials in Advertising (the “Guides”), which have been in effect in their current form since 1980.1 The evolving practice of companies marketing their goods and services through bloggers and other “new media” received special attention.
The FTC’s changes now make explicit that the principles in the Guides apply to a company’s marketing of its products or services through third parties using “new media,” such as blogs and social networks, and that both advertisers and their “sponsored” endorsers have responsibility for the content of such endorsements as well as for disclosure of commercial links that consumers would not expect to exist between the advertiser and the endorser (such as payments or free products in exchange for a blog post containing a positive product review). The update also includes a couple of changes to the old rules, including the elimination of the safe harbor originally authorized under the 1980 Guides for ads with unrepresentative consumer testimonials–in most such ads now, including a disclaimer such as “results not typical” or “results may vary” will no longer be sufficient.