FCC Enforcement Monitor ~ December 2017

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:

• FCC Proposes $20,000 Fine for Decade-Old EEO Violations
• FCC Goes After Small North Carolina Radio Station for Absence During Inspection
• Drone Company Agrees to $180,000 Settlement for Non-Compliant A/V Equipment

“Hire” Education: FCC Pursues South Carolina Radio Stations for EEO Violations

The FCC proposed a $20,000 fine against the operator of five radio stations near Myrtle Beach for allegedly failing to observe the Commission’s Equal Employment Opportunity (“EEO”) recruitment rules from 2008 through 2010.

The stated goal of the FCC’s EEO Rule is to promote equal access to employment opportunities in the communications industry while deterring discrimination in the hiring process.  Pursuant to the EEO Rule, the FCC requires broadcast stations to follow certain procedures before filling each full-time vacancy.  Among other things, the EEO Rule requires stations to use outside recruitment sources to publicize vacancies, notify interested third party referral sources of vacancies, and generate and retain in-depth recruitment reports.

This particular inquiry began in 2011 when the FCC randomly selected the stations’ employment unit for an EEO audit.  The audit revealed several alleged violations surrounding eleven vacancies over the preceding two-year period.  The FCC found that the licensee had either used no recruitment sources or only word-of-mouth when it recruited for six of the eleven vacancies.  Further, the licensee allegedly failed to contact a third party that had previously requested notification of full-time vacancies.

In addition, the FCC asserted that the licensee failed to keep adequate records of the number of interviewees or the referral source of most of the interviewees during that period.  As a result, this information was missing from both the licensee’s Annual EEO Public File Reports and its public inspection file.  The FCC concluded that this meant the licensee could not adequately “analyze its recruitment program … to ensure that it is effective…” as Section 73.2080(c)(3) of the FCC’s Rules requires.

As a result, the FCC issued a Notice of Apparent Liability (“NAL”) proposing to fine the stations.  While Section 503(b)(1)(B) of the Communications Act authorizes the FCC to penalize any person who violates the Act or the FCC’s Rules, neither the FCC’s Rules nor its forfeiture guidelines establish a base fine amount for specific EEO violations.  Instead, the FCC characterized the asserted violations as a “failure to maintain required records,” for which the forfeiture guidelines recommend a base fine of $1,000.  The FCC applied this fine to each of the six alleged violations of its recruitment rule and proposed an additional $2,000 fine for each of the other claimed EEO violations.  The FCC then added a $4,000 upward adjustment based on the licensee’s history of similar EEO violations at other owned stations, resulting in a total proposed fine of $20,000.

The NAL also proposed a reporting requirement under which the stations would need to report their recruitment and EEO activities directly to the FCC’s Media Bureau for each of the next three years.

Of particular interest to stations assessing their own EEO compliance, the licensee’s 2008-09 and 2009-10 recruitment reports indicated that the stations had lost much of their recruitment data to “unauthorized removal.” Specifically, the licensee subsequently reported that some of the records disappeared following the dismissal of the stations’ local business manager.  That explanation did not satisfy the FCC, which noted that the licensee’s loss of records “does not excuse it from having violated [the FCC’s] rules.”

This action is another reminder of the FCC’s strict enforcement of its EEO Rule.  Stations needing a refresher on these requirements should check out our EEO Advisory for more information, and our 2018 Broadcasters’ Calendar for important EEO-related deadlines coming up in the next year.

Out to Lunch: AM Broadcaster Notified of Station Inspection Violation

The Commission presented a Notice of Violation (“NOV”) to a small North Carolina broadcaster for failing to staff its station during lunch hour one day this past March.  In the same action, the FCC observed that the station was also transmitting from an antenna for which it was not licensed.

Section 73.1225(a) of the FCC’s Rules requires licensees to make their stations available for inspection by FCC representatives during all hours of operation.  Section 73.1350(a) requires a licensee to comply with all of the technical specifications set out in its station authorization.

When an FCC agent arrived at the station to conduct an inspection, the agent could not track down anyone at the station, even after several unanswered calls to the station’s telephone number.  That same day, the agent noticed the station was transmitting from a tower located nearly four miles from its authorized antenna location.

The FCC subsequently issued the NOV requiring the licensee to respond within twenty days.  Specifically, the licensee must explain, under penalty of perjury, the facts and circumstances surrounding the violation as well as any corrective action it has implemented.  The FCC will then consider this information as it mulls further enforcement action against the station.

Game of Drones: Unmanned Aerial Vehicle Company Settles with the FCC after Selling Non-Compliant RF Equipment

The FCC entered into a Consent Decree with a company that sells aerial drones and related audio/visual (“A/V”) equipment after an investigation into whether the company violated equipment authorization and marketing rules for devices that emit radio frequency (“RF”) radiation.

Section 302 of the Communications Act authorizes the FCC to regulate any device that may cause harmful interference to radio communications.  Section 2.803 of the FCC’s Rules prohibits the advertising, sale, or distribution of any radio frequency device that fails to comport with the FCC’s equipment authorization and labelling requirements.  The FCC’s Rules also prohibit amateur radio equipment from transmitting outside of Amateur Radio Service frequencies unless the equipment has first satisfied the FCC’s rigorous certification process.

Earlier this year, the Enforcement Bureau’s Spectrum Enforcement Division discovered that some of the company’s A/V transmitters were operable not only on authorized amateur service bands, but also on frequencies partially or completely reserved for federal agencies and governmental operations.  Some of the reserved frequencies on which the company’s devices could operate are used for vital services like air traffic control, military testing, space research, and early warning missile detection.  In addition, several of the company’s products exceeded the 1 Watt power limit for amateur model craft.  After receiving a Letter of Inquiry from the FCC investigating the potential violation, the company halted its marketing of the equipment at issue.

The company subsequently entered into a Consent Decree with the FCC to terminate the investigation.  Pursuant to the Consent Decree, the drone company must make a $180,000 “civil penalty” payment to the government and admit liability for violating the FCC’s authorization and marketing rules for RF devices.

The company must also develop a compliance program, including instituting new operating procedures, issuing a compliance manual for its employees, and launching an employee training program.

More information on the FCC’s rules for manufacturing, importing, and marketing RF devices can be found in our recent Advisory on the topic.

A PDF version of this article can be found at FCC Enforcement Monitor – December 2017.