This Week in Regulation for Broadcasters:  May 15 to May 19, 2023

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.

  • On May 17, the AM For Every Vehicle Act was introduced in both the US Senate and the House of Representatives, proposing to mandate that carmakers include AM radio, as a standard feature, in all cars sold in the United States.  The mandate would take effect after rules are issued by National Highway Traffic Safety Administration, which would be required within one year of the bill’s passage. For more details on this proposed legislation, see this article on our Broadcast Law Blog.
  • The FCC released a Report and Order and Notice of Proposed Rulemaking regarding the 2023 FCC annual regulatory fees to be paid in September by broadcasters and other FCC-regulated entities.  Regulatory fees reimburse the government for the cost of operating the FCC and are allocated based on how many FCC staff employees work on matters relating to a particular industry.  The FCC tentatively concluded that certain employees whose costs had in the past been included in broadcasting’s allocation do not in fact have any role in regulating broadcasting – so their costs have been reallocated to other regulated industries.  That reallocation has resulted in a proposed decrease in the 2023 fees to be paid by broadcasters.  For example, the FCC proposes to reduce the per population fee used to set the amount TV stations owe by approximately 11.5% from last year. The FCC also included a more graduated schedule for radio fees, further reducing fees on some of the smallest radio stations.  For more on the fee proposal, see our recent article on our Blog.  Comments on the proposed fees will be due June 14, 2023, with reply comments due June 29, 2023.  Expect a final decision on the fees around Labor Day so that the fees can be paid before the October 1 start of the government’s new fiscal year. 
  • The FCC’s Media Bureau released a Public Notice announcing that it was repealing the COVID-related guidance released in March 2020 that allowed broadcasters and local cable operators to offer free advertising time to advertisers and other local businesses without those spots being considered in calculating the Lowest Unit Charge accorded to candidates in “political windows,” 45 days before a primary and 60 days before a general election.  During the early days of the COVID emergency, broadcasters used free advertising schedules, not directly tied to any advertising contract, to fill gaps in their advertising schedules and to promote businesses who were still operating.  With the pandemic emergency now declared over by the federal government, the FCC believes that this specific accommodation can come to an end.  For more information on this decision, see our article here.
  • The FCC reinstated the license of an FM translator in Vermont, overturning a decision of the Audio Division of the FCC’s Media Bureau which had canceled the license under Section 312(g) of the Communications Act.  That section requires automatic termination of a broadcast license if a station is silent for more than 12 consecutive months.  The decision was significant in that it accepted the licensee’s sworn statements attesting to the station’s operation within the one-year period as adequate evidence that the station had been operating within one year of going silent, even without documentary evidence of electric bills, logs, recordings, and similar items that the Audio Division’s decision had indicated was necessary.  The Commission also concluded that the translator’s operation at an apparent variance from its authorized facilities, but at its authorized transmitter site, would not subject it to automatic license cancellation under Section 312(g), distinguishing past cases where licenses were cancelled when stations resumed operations from an unauthorized transmitter site.  The Commission did direct the Bureau to consider appropriate enforcement action (e.g., a possible fine) for the licensee’s failure to seek authorization to operate at variance from its licensed facilities
  • The FCC continues its enforcement actions against pirate radio operations, with the FCC’s San Francisco Office issuing a Notice of Illegal Pirate Radio Broadcasting about an unlicensed FM broadcast station in the vicinity of Wasilla, Alaska.  The FCC notified the owner of the property from which the pirate was operating that the FCC could issue a fine of up to $2,149,155 if the pirate radio broadcasting continued.  The FCC gave the property owner 10 days to respond that they are no longer permitting pirate radio broadcasting on their property, and to identify the individual(s) who were engaging in the unauthorized broadcasting. 
  • The FCC’s Media Bureau and Office of Managing Director issued an Order to Pay or Show Cause why an FM station license should not be cancelled for failure to pay its 2013, 2014, and 2015 regulatory fees.  Consistent with the FCC’s prior practice, the Order gives the licensee 60 days to either submit evidence that all debts have been paid or show cause why the payment should be waived or deferred, or its license will be revoked.
  • This week, the Supreme Court issued opinions on two subjects of interest to media companies. 
    • In two cases (here and here), it avoided addressing the scope of Section 230 of the Communications Decency Act, which protects online platforms from legal liability for content created by others and posted to their sites.  These two cases, seeking to hold Twitter and YouTube liable for postings by terrorist organizations, were thought to have the potential to limit the insulating effect of Section 230.  As we’ve noted on our blog (see, for instance, our articles here and here), some have called for a narrower interpretation of the liability shield afforded by Section 230.  In these decisions, the Court instead found that the claims could be rejected on other grounds, avoiding the Section 230 issue.
    • In a major copyright decision, the Court found that Andy Warhol’s prints of the late musician Prince infringed on the copyright of the photographer whose picture was the basis of the prints. The Court found that the Warhol prints were not meant as commentary or criticism of the original photograph and were not “transformative” as they were used for a commercial purpose to illustrate a magazine article about Prince in the same way that the original photograph was used.  Thus, the prints were found not to constitute “fair use.”  Look for more on this decision on our Broadcast Law Blog later this week.

Courtesy Broadcast Law Blog