Here are some of the regulatory developments of significance to broadcasters from the past week, with links to where you can go to find more information as to how these actions may affect your operations.
Courtesy Broadcast Law Blog
Courtesy Broadcast Law Blog
Here are some of the regulatory developments of significance to broadcasters from the past week, with links to where you can go to find more information as to how these actions may affect your operations.
Courtesy Broadcast Law Blog
Yesterday, I wrote about the history of the NCAA’s assembling of the rights to an array of trademarks associated with this month’s basketball tournament. Today, I will provide some examples of the activities that can bring unwanted NCAA attention to your advertisements or broadcasting of advertising, as well as one more issue that should be considered when considering whether to accept advertising.
Activities that May Result in a Demand Letter from the NCAA
The NCAA acknowledges that media entities can sell advertising that accompanies the entity’s coverage of the NCAA championships. However, similar to my discussion last year on the use of Super Bowl trademarks (see here) and my 2018 discussion on the use of Olympics trademarks (see here), unless authorized by the NCAA, any of the following activities may result in a cease and desist demand:
There is one more common pitfall that is unique to the NCAA Basketball: tournament brackets used in office pools where participants predict the winners of each game in advance of the tournament. The NCAA’s position (see here) is that the unauthorized placement of advertising within an NCAA bracket and corporate sponsorship of a tournament bracket is misleading and constitutes an infringement of its intellectual property rights. Accordingly, it says that any advertising should be outside of the bracket space and should clearly indicate that the advertiser or its goods or services are not sponsored by, approved by or otherwise associated with the NCAA or its championship tournament.
It should be noted that the NCAA also imposes strict rules about the authorized uses of its trademarks. The NCAA’s Advertising and Promotional Guidelines for authorized use of its marks are posted online (see here).
Again, importantly, none of these restrictions prevents media companies from using any of the marks in providing customary news coverage of or commentary on the tournament. Just be sure that they are just used to identify the tournament and its stages, and don’t in any way imply that there is an association between the station itself or any sponsor or advertiser who does not have the rights to claim such association and the NCAA.
A Surprising History of “March Madness” (For Those Who May Like Sports Trivia)
The NCAA may not have been the first to license the use of “March Madness.” Beginning in the early 1990’s, the IHSA licensed it for use by other state high school basketball tournaments and by corporations.
Moreover, the NCAA did not originate the use of “March Madness” to promote its collegiate basketball tournament. Rather, a CBS broadcaster is credited with first using “March Madness” in 1982 to describe the tournament. As CBS was licensed by the NCAA to air the tournament, the NCAA apparently claims that as its date of first use.
Finally, the NCAA was not the first to register “March Madness” as a trademark. That honor went to a company called Intersport, Inc., which used the mark for sports programs it produced and registered the mark in 1989.
So, how did the NCAA get to claim ownership of the March Madness® trademark? The short answer is through litigation and negotiations over a period of many years. Although it has also been able to obtain federal registrations for Final Four® and Elite Eight,® it was late to the gate and Sweet Sixteen® and Sweet 16® are registered to the Kentucky High School Athletic Association (KHSAA). (The NCAA, however, has the KHSAA’s consent to register NCAA Sweet Sixteen® and NCAA Sweet 16®.)
The Final Score
Having invested so much in its trademarks, the NCAA takes policing its trademark rights very seriously. Even so, although the NCAA may call “foul!” and send a cease-and-desist letter over the types of activities discussed above, some claims may not be a slam-dunk as there can be arguments to be made on both sides of these issues.
If you are deciding whether or not to pass on accepting advertising incorporating an NCAA trademark or logo or using an NCAA trademark or logo other than in the context of reporting on the tournament, or if you are not certain whether the NCAA (or anyone else) owns a particular word or phrase as a trademark, you should seek an assist. An experienced trademark attorney can help you make an informed decision about whether you can successfully post a defense against any such charge and assess possible risks.
One Last Advertising Issue: Endorsements by Individual Student-Athletes
After many years of litigation, in July 2021, the NCAA suspended its policy prohibiting college athletes from profiting from their names, images and likenesses (“NIL”) (or their right of publicity) without losing their eligibility. However, there is no national set of rules as to what is permissible. Rather, the right of publicity is governed by state law. Moreover, colleges and universities still have the right establish some rules or standards. For example, although student-athletes can now get paid to endorse a commercial product, they are not automatically entitled to use any NCAA or school trademarks. Thus, a college basketball player may not be authorized to wear their uniform in advertising unless the school has granted permission. Can the player wear a uniform with the school colors, but no names or logos? Can the player endorse an alcoholic product? Answers will vary state by state and school by school, so it will be extremely important to check with experienced counsel before running any advertising that involves college players.
Courtesy Broadcast Law Blog
With Selection Sunday this weekend, the 2023 NCAA Collegiate Basketball Tournament is about to begin. As faithful readers of this blog know, broadcasters, publishers and other businesses need to be wary about potential claims arising from their use of terms and logos associated with the tournament.
NCAA Trademarks
The NCAA owns the well-known marks March Madness®, The Big Dance®, Final Four®, Women’s Final Four®, Elite Eight,® and The Road to the Final Four® (with and without the word “The”), each of which is a federally registered trademark. The NCAA does not own “Sweet Sixteen” – someone else does – but it does have federal registrations for NCAA Sweet Sixteen® and NCAA Sweet 16®.
The NCAA also has federal registrations for some lesser-known marks, including March Mayhem®, March Is On®,Midnight Madness®, Selection Sunday®, 68 Teams, One Dream®, And Then There Were Four® and NCAA Fast Break®. (It also has a registration for SPRING MADNESS®in connectionwith its soccer tournaments.)
Some of these marks are used to promote the basketball tournament or the coverage of the tournament, while others are used on merchandise, such as t-shirts. The NCAA also uses (or licenses) variations on these marks without seeking registration, but it can claim common law rights in those marks, such as March Madness Live, March Madness Music Festival and Final Four Fan Fest.
The NCAA also has pending applications for the marks And Then There Were Eight, And Then There Were 8 and Four It All. Although there has not yet been any use of these marks, if they are ultimately registered, the NCAA will have priority over anyone using those marks after the filing dates of the applications. In other words, although the NCAA currently does not have any rights in these marks, anyone who chooses to use either mark runs a significant risk of liability down the line.
Although the NCAA may use the federal registration symbol (®) with any of its federally registered marks, it is not obligated to do so. Thus, it should not be assumed that the lack of the symbol with any particular trademark means that the NCAA is not claiming trademark rights.
The NCAA Aggressively Pursues Unauthorized Use of its Trademarks
The NCAA’s revenue from its annual basketball tournament is the primary source of its annual income. In 2022, its total revenue was $1.14 B and 85-90% of that came from the men’s tournament. Although this figure is marginally less than the revenue for 2021, historically, with the exception of 2020 when the tournament had to be cancelled, its revenues have grown each year.
For 2023, the licensing of television rights in the Division I Men’s Basketball Tournament will result in $870M in revenue for the NCAA. Although most of the NCAA’s tournament-related income is directly related to the games, it also has a substantial amount of revenue from licensing March Madness® and its other marks for use by advertisers. As part of those licenses, the NCAA agrees to stop non-authorized parties from using any of the marks. Indeed, if the NCAA did not actively police the use of its marks by unauthorized companies, advertisers might not feel the need to get a license or, at least, to pay as much as they do for the license. Thus, the NCAA has a strong incentive to put on a full court press to prevent non-licensees from associating their goods and services with the NCAA tournament through unauthorized use of its trademarks. The NCAA’s current statement regarding its Trademark Protection Program can be viewed here.
Accordingly, the NCAA is very serious about taking action against anyone who may try to trade off the goodwill in its marks — even if the NCAA’s actual marks are not used. For example:
It should be noted that, before these marks were published for opposition, Trademark Attorneys at the PTO concluded that each of these marks was not confusingly similar to any registered marks.
These actions illustrate the level of importance that the NCAA places on acting against the use or registration of trademarks which it views as being likely to create an association with its annual Collegiate Basketball Tournament. Clearly, such activities carry great risks.
Tomorrow, I will provide some specific examples of actions built around the tournament that could attract the unwanted attention of the NCAA and one more issue to be considered in advertising or accepting advertising relating to the games.
Courtesy Broadcast Law Blog
Yesterday’s big news across the broadcast press was that Gigi Sohn, who had for well over a year been the nominee of the Biden administration to fill the open seat at the FCC, withdrew her name from consideration. This may have been in reaction to circulated stories that there were several Democratic Senators who still were not committed to vote for her nomination without whose support she could not have been confirmed. Until the Biden administration can make another nomination and have that nominee go through the confirmation process in the Senate, the FCC will continue to have two Democratic Commissioners and two Republican ones, potentially stalling action on some rulemaking matters where there is a partisan split on the pending issue. We wrote in January in our look at the issues pending before the FCC about some of the issues that the FCC could face in 2023. In light of the seeming extension of the partisan divide on the FCC, we thought that we would again highlight some of the issues likely to be affected by the current state of the Commission.
But it is first worth noting that, merely because there is a partisan split among the Commissioners, this does not mean that nothing of significance will happen at the FCC. As we wrote yesterday, the TEGNA merger was designated for hearing, potentially leading to its demise. This was done not by an action of the Commissioners, but instead by its Media Bureau. Interpretations of FCC authority in specific cases by the Media Bureau, the Enforcement Bureau or other lower-level bureaus and offices within the Commission can be just as impactful on any specific company as are the big policy decisions made by the Commissioners themselves. Just as the TEGNA designation could have significant ramifications for broadcast dealmaking if its conclusions are taken to their logical ends, Bureau-level decisions can set day-to-day policy on many issues if the Commission itself cannot make broader decisions through their rulemaking process.
Changes to the FCC ownership rules may be one casualty of a deadlocked FCC. On the same day that the TEGNA decision was released, comments were due on the 2022 Quadrennial Review FCC’s ownership rules, a review initiated as the partisan deadlock on the Commission apparently prevented the FCC making any decisions in its 2018 Quadrennial Review (see our article here on the initiation of the 2022 Review). The comments filed Friday are little different from those filed when the Commission asked in 2021 for a refreshing of the record in the 2018 Quadrennial Review, after the Supreme Court decision upheld the Commission’s 2017 abolition of the TV-Newspaper cross-ownership rule and relaxed certain TV ownership rules (see our article here). Many public interest groups opposed any further relaxation of the ownership rules, some radio companies opposed relaxation of the radio rules except for AM station subcaps, fearing that relaxation of the FM rules would take all investment away from AM. In addition, the NAB and other broadcast companies have argued that today’s media marketplace requires substantial relaxation in the ownership rules. With these diverse comments, and the partisan-deadlocked FCC, don’t expect quick resolution of any Quadrennial Review. Instead, it appears that any action that does occur on broadcast dealmaking will be through decisions like last week’s TEGNA designation.
EEO reform seems to be another area where there are partisan differences, with some favoring a more numbers-oriented enforcement and monitoring regime, and others looking more broadly at questions of unfairness and actual hiring bias and discrimination, and at affirmative actions (like the tax certificate) to economically incentivize new entrants into broadcasting. While there are EEO proposals pending at the FCC (including the possible revival of the Form 395B annual report which would disclose race, ethnicity, and gender information for broadcast employees, and another proceeding to more broadly look at EEO enforcement), the partisan divide on the Commission may well leave EEO enforcement issues to the Commission’s staff.
There does seem to be more bipartisan cooperation on issues like emergency communications, disabilities-related accessibility, and even rules for the disclosure of information about foreign government sponsored programming, so expect continued Commission actions in these areas. Also watch for action on issues that appear more non-partisan, like reform of the process for allocating the burdens of annual regulatory fees. Where issues about the ATSC 3.0 rollout for television fall are a little harder to discern – but there may be some action there soon as the FCC just issued a temporary stay of the expiration of the requirement that stations converting to ATSC 3.0 maintain a substantially similar program stream in the old ATSC 1.0 transmission format. An FCC decision is now circulating among Commissioners that would apparently address this issue and other matters related to the transition.
Regulatory activity at the FCC will go on – such as considering routine actions in the normal course, putting the resolution of some high-profile partisan issues on hold, and considering other issues through novel means like those employed in connection with the TEGNA deal. No matter what the make-up of the FCC, there seems to be no lack of regulatory issues for broadcasters and other media companies to consider.
Courtesy Broadcast Law Blog
Last week, broadcasters and broadcast journalists were abuzz with discussions of the FCC’s Media Bureau issuing a hearing designation order referring to an Administrative Law Judge questions about the proposed acquisition of the TEGNA broadcast stations by Standard General Broadcasting. This week brings news that the parties have filed a Motion asking that the Judge certify this designation to the FCC Commissioners to determine whether the case really should have been designated for hearing. The request that the case be referred to the Commissioners notes that the designation would have the effect of terminating the transaction, as the contract provides the parties only until May to close, and the buyer cannot get the agreement extended. With so many questions about the TEGNA deal and its designation for hearing, we thought that we would review the hearing designation process and look at the inherent delays in the process which led to the parties’ contention that the designation, if not reviewed by the Commission, will effectively kill the deal. In a subsequent article, we will look at some of the substantive issues raised by the hearing designation order.
Five years ago, we wrote about the hearing designation process in connection with the last major case where a proposed broadcast transaction was designated for hearing, i.e., Sinclair Broadcast Group’s proposed acquisition of the television stations owned by Tribune Media. The TEGNA case differs from the Sinclair case in one significant manner, namely that the hearing designation order in the TEGNA case was issued by the Chief of the FCC’s Media Bureau, not by the Commissioners themselves. In the Sinclair case, the Commissioners issued the hearing designation order, meaning there was no opportunity to ask for the review now being sought by the parties to the TEGNA deal. When a designation order is issued by a Bureau, the party whose application was designated for hearing can, as in the TEGNA case, ask the presiding Administrative Law Judge to certify the case to the Commissioners before starting the hearing process, if there are questions of law that suggest that the case should not have been set for hearing. While the Judge can decide to seek the guidance of the full Commission through this kind of certification, the full Commission need not take up the case even if the Judge decides to certify it to them. Instead, the Commissioners can decide that the hearing should move forward, and that the legal issues can be considered later after the full hearing has taken place. While that is the procedure set out in the FCC’s rules, the TEGNA parties argue that were the Judge to certify the case and the Commission did take action, then they intend to directly appeal the matter to the Courts for review (which is normally not allowed until a decision is reached by the ALJ) because the designation for hearing by itself, issued after the application was pending for a year, equates to a the denial of the application. What in the process for a case once designated for hearing that leads to that conclusion? Let’s look at the process of setting a case for hearing.
Several decades ago, the process of designating an application for hearing was a common occurrence, often used by the FCC to decide between competing applicants for new broadcast (and in some cases non-broadcast) licenses, or in connection with decisions as to grant the license renewal of broadcast stations where substantive petitions or competing applications were filed against such applications, or to deal with enforcement issues when there were questions about the facts of a particular case. The FCC had a large staff of Administrative Law Judges who heard these cases, and they were usually quite busy. But as the comparative hearing process for new stations morphed into the current process of awarding new stations through auctions, and after the FCC’s rules were changed to eliminate competing applicants to renewal applications, hearings dwindled. As a result, the staff of ALJs at the FCC shrunk to just one. Administrative hearings at the FCC are now rare, so the process that an FCC hearing would follow may not be widely understood.
Congress established, in Sections 309 and 310(d) of the Communications Act, the way in which the FCC must process applications. In cases involving applications for new stations or for the purchase and sale of stations, applications are filed providing information required by the FCC and such supplemental information as the FCC may request. Interested parties routinely have 30 days in which to petitions objecting to applications, and those petitions must include detailed allegations supported by facts either in the public record or otherwise supported by statements from those with personal knowledge, arguing why an application should not be granted. Applicants then are afforded the opportunity to respond to any allegations raised. In most cases, the FCC will attempt to resolve any disputes, or any questions that it has on its own, on the basis of the written materials presented in the application, the petitions, and in response to any FCC supplemental request for information.
In evaluating whether to approve an application to acquire a station, the FCC, under Section 310(d) of the Communications Act, must determine whether the public interest will be served by a grant of the application. However, that same section makes clear that the FCC “may not consider whether the public interest, convenience, and necessity might be served by the transfer, assignment, or disposal of the permit or license to a person other than the proposed transferee or assignee.” Thus, the FCC must evaluate the applicant before it to decide if they have the basic qualifications to acquire the station, and the FCC cannot deny the application based on a belief that there might be some better qualified applicant to acquire the station. This obviously provides some comfort to the deal marketplace, as it provides assurance that, the FCC will grant the application if the buyer is qualified, even if there was some unsuccessful bidder who might believe that they would better be able to run the station in question. In the TEGNA case, the parties argue that this policy has been violated because no disqualifying issue about the potential buyer has been raised. We will look at the issues raised in a subsequent article.
At the same time, Section 309(e) makes clear that, if there is a “substantial and material question of fact” or if the Commission is otherwise not able to determine that an application meets the requirements of the rules, it can formally designate the application for hearing. More specifically, where there are questions of fact raised about the qualifications of the prospective applicant, and those factual issues cannot be resolved based on the pleadings filed in connection with the application and any objection, the FCC can issue what is called a Hearing Designation Order to send the application to an Administrative Law judge to hold an evidentiary hearing to try to resolve the factual issues. That Order recites the facts of the case and discusses the problems that the FCC has with the application. It sets out a specific list of “issues” that the Judge is to consider in the hearing process. In its request that the full Commission review the designation order, the TEGNA parties have argued that there really is no material question of fact, as every document related to the transaction has been produced to the FCC, and as the parties have made promises that they believe resolve all issues that the FCC raises.
But if a hearing goes forward, the process by which the ALJ conducts the hearing is set out in the Communications Act and by FCC rules. Usually, the FCC will have its own attorneys participate in the case, conducting discovery (e.g., document production, depositions, interrogatories) as in any other court case, trying to get to the bottom of the specific issues presented. Other “parties in interest” in the case, usually including those who filed formal petitions to deny, will also have an opportunity to participate as parties. The FCC process allows parties to file requests to “enlarge the issues,” urging consideration of issues beyond those designated by the FCC. As in the petition to deny process, specific facts to support any additional issues must be provided, and the judge needs to conclude that the request raises a substantial matter that merits the addition of new issues besides those already designated by the FCC.
Also, before any actual trial-type hearing, parties can also ask for summary decision to resolve some or all of the issues presented based on the facts in the record or produced through discovery. If the issues are not resolved in that manner, the ALJ will routinely conduct an actual trial-type hearing, with the Judge in a robe, witnesses being called to testify under oath as recorded by a court reporter, and cross-examination by attorneys for the other side. After the hearing, the parties typically file “findings and conclusions” – legal briefs summarizing the facts brought out at hearing and citing the legal precedent that should be applied to those facts.
In most cases that are designated for hearing, the Judge, after considering the facts, will evaluate the record of the hearing and the written arguments before rendering a decision in writing. Usually, the Judge’s decision can be appealed to the full Commission. But the TEGNA case does not follow the usual model. Most of the time, the Hearing Designation Order will include a final “issue” that is designated for hearing – one asking the Judge to determine, based on her findings of fact, whether the application that has been designated should be granted. In the TEGNA case, there is no such ultimate issue for the Judge to decide. Instead, the Order simply asks the Judge to make the findings of fact and return the case to the Media Bureau to decide what additional steps should be taken based on the Judge’s findings.
As in any civil litigation, these cases can be lengthy, with discovery and other procedural wrangling taking months to play out. Those delays are one of the reasons that the FCC has tried wherever possible to avoid actual hearings – even in some cases resorting to “paper hearings” to try to adduce the facts necessary to deal with an application (see, for instance our articles here and here about cases where the FCC ordered a paper hearing as to whether stations that had been off the air for substantial periods of time during a license term were entitled to a renewal of license). It is common for contracts for the acquisition of broadcast stations to contain a right to terminate the agreement by either party if there is a designation for hearing, given the delays and costs inherent in such a hearing.
The process is a relatively straightforward one, but one that is time-consuming, leading to the TEGNA parties’ contention that the designation order effectively kills the deal. We will see how that process plays out if the Judge grants the request to refer the case for consideration by the full Commission, or if the parties seek other extraordinary relief in this most unusual case.
Courtesy Broadcast Law Blog
Here are some of the regulatory developments of significance to broadcasters from the past week, with links to where you can go to find more information as to how these actions may affect your operations.
Courtesy Broadcast Law Blog
Courtesy Broadcast Law Blog
Here are some of the regulatory developments of significance to broadcasters from the past week, with links to where you can go to find more information as to how these actions may affect your operations.
Courtesy Broadcast Law Blog