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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:

Headlines:

  • TV Broadcaster Agrees to $55,000 “Civil Penalty” for Airing False EAS Tones
  • Radio Broadcaster to Donate or Surrender Nine FM Stations to Resolve Investigation of Stations Being Silent for Extended Periods
  • FCC Proposes $6,000 Fine Against California TV Station for Public File and Related Violations

Broadcast of False EAS Tones Leads to $55,000 Settlement with FCC

The FCC entered into a Consent Decree with the parent company of a Florida TV station to resolve an investigation into whether the station transmitted Emergency Alert System (“EAS”) tones outside of an actual emergency.

Section 325(a) of the Communications Act prohibits any person from transmitting “any false or fraudulent signal of distress” or similar communication. Further, Section 11.45 of the FCC’s Rules prohibits transmission of “the EAS codes or Attention Signal, or a recording or simulation thereof,” unless it is “an actual National, State, or Local Area emergency or authorized test of the EAS” (emphasis added).

On August 9, 2016, the FCC received a complaint alleging that the station had “aired a commercial multiple times that improperly used the EAS data burst and tone.” The FCC subsequently began an investigation into whether the station had violated its rules governing EAS, and directed the station to respond to the allegations.  In its response, the station explained that it started airing an advertisement on August 6, 2016 for a professional football team which opened with EAS Tones, the sounds of wind and thunder, and a voiceover stating: “This is an emergency broadcast transmission. This is not a test. This is an emergency broadcast transmission. This is not a test. Please remain calm. Seek shelter.”

The station claimed that its policies and practices do not allow transmission of false EAS tones, but that it received the advertisement from an outside source and the station’s “employees apparently failed to screen the Promotion before airing it.” The station explained that when a senior member of the station’s staff saw the advertisement on August 8, 2016, he notified the general manager that it contained a prohibited use of an EAS tone, and told staff not to air it again.

The station’s parent company subsequently entered into a consent decree with the FCC to resolve the investigation, under which the company (1) admitted that the station aired material that contained simulated EAS tones absent an actual emergency or authorized test of the EAS, (2) agreed to pay a $55,000 civil penalty, and (3) agreed to implement a three-year compliance plan.

Radio Broadcaster Agrees to Donate or Surrender Nine FM Station Licenses for Failure to Operate Stations

The owner of a number of radio stations entered into a Consent Decree with the FCC to resolve an investigation into the company’s alleged failure to operate its stations during their most recent license terms.

Section 312(g) of the Communications Act prohibits extended periods of silence by licensed stations because of their obligation to serve the public by broadcasting on their allocated spectrum. Specifically, a station’s license will automatically terminate if it remains silent for twelve consecutive months unless the FCC acts to extend or reinstate the license where “the holder of the station license prevails in an administrative or judicial appeal, the applicable law changes, or for any other reason to promote equity and fairness.”  Additionally, the Act authorizes the FCC to revoke any station license for failure to operate substantially as set forth in that license, and Section 73.1740 of the FCC’s Rules establishes minimum operating requirements for broadcast stations. Continue reading →

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No, I’m not referring to the fact that physically writing a letter seems to have joined button hooks and slide rules in the dustbin of history.  Instead, another relic of history–the requirement that letters and emails from the public be kept in the public file–disappeared from the FCC’s rulebook today.  Even more consequentially, that change means that it is now possible for a station that has uploaded all of its other public file materials to the FCC’s online database to eliminate its local public file, ending a requirement adopted over fifty years ago.

That news may confuse many, as our regular readers know that the FCC voted to eliminate the requirement at the first meeting of the Pai FCC on January 31, 2017.  At the time, the news was reported in many publications as “FCC eliminates letters from the public from public file.”  As a result, many assumed that the requirement had ceased to exist five months ago.

However, because the change affects what information the government requires of broadcasters (or in this case, no longer requires), it had to first be approved by the Office of Management and Budget under the Paperwork Reduction Act of 1995.  News of the OMB approval then needed to be published in the Federal Register, along with the effective date of the rule change (only in government would a statute called the Paperwork Reduction Act actually require more paperwork).

OMB approval has now been received, and the Federal Register duly reported that today, along with the corresponding effective date of the change: June 29, 2017.  So, for stations that have already uploaded all other public file documents to the FCC’s public file database, including political file documents, the requirement to maintain a local “paper” file is no more.

That in turn has at least two ripple effects.  First, as the FCC noted in eliminating the requirement, stations will now be able to secure their facilities at a time when the media finds itself increasingly the target of threats and violence.  No longer will potentially unstable or violent individuals be able to make it past the front door merely because they know the phrase “I’d like to see the public file.”

Second, such stations will no longer need to ensure they have sufficient staff continuously on hand to guarantee a visitor can immediately inspect the local public file at any time during regular business hours, including lunchtime.

So if your station has uploaded all of its other public file documents to the FCC’s database, today, for the first time since 1965, you can hang a sign saying “Out to Lunch” on the front door.  Go have a bite with your station colleagues, and regardless of where you eat, it will no doubt be a particularly tasty and very memorable lunch.

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The FCC voted unanimously yesterday to adopt a Notice of Inquiry (“NOI”) that may have a profound impact on the delivery of communications services in residential and commercial buildings, shopping malls and other multiple tenant environments (“MTEs”). This proceeding will revisit FCC rules and policies developed during the last 17 years, focusing on whether changes need to be made to enhance broadband deployment and consumer choice.  Building owners and managers, communications service providers, and tenants all have a stake in the outcome of this inquiry.

In a nutshell, current FCC policies favor competitive access by telecom and video service providers (with some exceptions), and prohibit exclusive contracts between service providers and building owners that would limit such access. These rules also cover access to in-building wiring and the conduits and rights-of-way within these properties that are owned or controlled by the service providers.   The rules apply to regulated service providers because the FCC generally lacks jurisdiction over building owners and managers.

The most recent FCC order, issued in 2010, approved the use of exclusive marketing and bulk billing arrangements between video providers and building owners. Exclusive marketing arrangements give video providers the exclusive right to market services to residents in a building.  Bulk billing arrangements permit the video provider to serve each resident of the building, usually at a significant discount from the retail rate.  The billing for services is often included within the rent, whether the resident uses the services or contracts with another service provider.

The FCC initiated this proceeding in response to allegations from fixed and mobile broadband service providers that they face challenges in expanding their service footprint because of MTEs with exclusive contracts. There are also arguments that state regulations intended to encourage competitive access actually hinder the ability to provide competitive services. In one pending proceeding, a group of service providers has asked the FCC to preempt an ordinance recently adopted by the City of San Francisco requiring building owners to give competing service providers access to existing wiring upon request from a resident, which the complaining service providers and many building owners contend will deter investment in the communications infrastructure of new buildings and is impractical because of space limitations in many older buildings.

Unlike the earlier proceedings which were focused on specific markets (telecommunications or video services) or types of buildings (resident or commercial), the NOI will cover all services and all types of MTEs. Indeed, for the purpose of this proceeding, MTEs include both commercial and residential premises such as apartment and condominium buildings, shopping malls, gated communities, mobile home parks, garden apartments and other centrally managed residential real estate developments, or any multi-unit premise occupied by two or more distinct units.  Most buildings are covered by this proceeding.

Some of the specific questions on which the FCC seeks comment include:

  1. Whether there are state and local regulations that may inhibit broadband deployment and competition within MTEs;
  2. Whether the FCC should revisit its decision approving exclusive marketing and bulk billing arrangements;
  3. Whether revenue sharing agreements, exclusive wiring arrangements or other types of contractual provisions are affecting broadband competition within MTEs;
  4. Whether there are statutory or jurisdictional considerations that should guide the FCC’s actions in this proceeding; and
  5. Whether the proposed reclassification of broadband internet access as an information service will impact the FCC’s legal authority to address broadband deployment within MTEs.

Comments in this proceeding will be due July 24, 2017 and reply comments will be due August 22, 2017.   The NOI process is a first step toward the development of new rules.  Once the NOI comment cycle is completed, the FCC may issue a Notice of Proposed Rulemaking proposing rule changes, requiring another round of comments before new rules could be adopted.

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As we wrote about at the time, in April the Pai FCC continued its efforts to modernize broadcast regulation by restoring an old rule–the UHF Discount–until it can take a broader look at its national ownership cap later this year.  While restoration of the Discount merely reinstated the status quo that existed before the Wheeler FCC’s rushed effort to eliminate the Discount last fall, the decision was greeted with disdain by advocacy groups concerned about media consolidation.

After the Commission’s April 20 vote to restore the UHF Discount, those groups filed a request that the FCC stay the rule change rather than let it go into effect on June 5, 2017.  The FCC did not act on that stay request, leading the groups to file an additional stay request with the United States Court of Appeals for the District of Columbia Circuit on May 26, 2017.

Given the short time span between the stay filing and the effective date of the Discount reinstatement, the court issued an administrative stay of the effectiveness of the change until it could complete its review of the request and oppositions filed subsequently.  A fair amount of public confusion was caused when a number of publications reported that administrative stay as “court stays reinstatement of UHF Discount”, failing to note that it was just a short term stay unrelated to the merits of the case.

This morning, the court lifted that administrative stay, and denied the groups’ larger request for a stay pending court review of the FCC’s order reinstating the UHF Discount.  In a one-page order, the court tersely stated that the “Petitioners have not satisfied the stringent requirements for a stay pending review” and denied the request.

As a result, the UHF Discount is once again the law of the land.  It is of course still subject to the pending appeal, which the court will rule on at a later date.  However, even that appeal could be mooted by whatever action the FCC takes in its comprehensive review of the national ownership rule later this year.