Civil Law

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.

• FCC Chairwoman Rosenworcel announced that two Notices of Proposed Rulemaking (NPRMs) have been drafted, which, if adopted by the Commission, would seek public comment on proposals to protect consumers from the effects of blackouts lasting more than 24 hours resulting from the failure of broadcasters and Multichannel Video Programming Distributors (MVPDs, i.e., cable and satellite TV providers) to reach a retransmission consent agreement.  The NPRMs propose to require MVPDs, in the event of a blackout due to the failure to reach a retransmission consent agreement with a broadcaster, to: (1) issue rebates to subscribers to compensate them for the channels that they do not receive; and (2) notify the Commission via an online public portal of broadcast blackouts lasting 24 hours or more. These specifics of the proposed NPRMs have been circulated to the other Commissioners for their review and are not yet publicly available. 
• The FCC imposed two substantial fines on pirate radio operators who ignored FCC warnings to cease their operations.  In each case, the pirate radio operators have 30 days to pay the fine or their case will be referred by the Commission to the U.S. Department of Justice for enforcement.  The FCC itself cannot sue to collect fines against individuals who ignore the penalties issued in cases like this; instead, it relies on the DOJ to enforce the penalties in Court.  The specifics of these cases follow:
  • In one case, the Commission imposed a $ 2,316,034 fine against two individuals for operating a pirate FM radio station in Queens, New York.  The decision followed the Commission’s March 2023 Notice of Apparent Liability, which we wrote about here, when the FCC first proposed the fine.  The two individuals failed to respond to its March 2023 Notice.  The Commission relied upon the PIRATE Act passed by Congress in 2020, which enabled the FCC to impose higher fines for pirate radio operators.  The Commission concluded that the maximum penalty under the PIRATE Act was appropriate because the pirate radio operators operated their pirate radio station for over a decade – even after many prior FCC actions including repeated warning (including personal warnings by FCC agents), previous fines that were ignored, and equipment seizure by US Marshalls.  Despite all these actions, the pirate continue to operate, even promoting their operations on a website and through social media. 
  • In the second case, also an Order following up on a March Notice of Apparent Liability (which we also wrote about here), the FCC imposed an $ 80,000 fine on the operator of an Oregon pirate station.  This pirate also failed to respond to the FCC’s March Notice of the proposed fine.  In the Oregon case, the pirate kept operating despite repeated warnings from the FCC and twice having his equipment seized by the Federal government.  The pirate apparently ceased operations only when his landowner was threatened by the FCC with a fine (under the PIRATE Act, landowners can be fined for allowing pirates to operate from their land).
• Last week, the FTC held a roundtable discussion on the creative economy and generative artificial intelligence (“AI”).  The event featured remarks from FTC Chair Lina Khan, FTC Commissioner Rebecca Kelly Slaughter, and FTC Commissioner Alvaro Bedoya – which was followed by a discussion with stakeholders representing creative media organizations.  Each witness expressed concern about how AI could affect their industry by appropriating their work to create new content that the original artists are not compensated for and did not consent to.  More information, including transcripts and video of the proceeding, are available on the FTC website here.
  • The potential harms of generative AI was also addressed by Congress this week through the introduction of a bipartisan bill, which seeks to protect actors, musicians, and other performers’ likenesses from unauthorized replicas that are generated using AI.  Specifically, under the bill, known as the Nurture Originals, Foster Art, and Keep Entertainment Safe (NO FAKES) Act, individuals and companies would be held liable for producing unauthorized replicas of individuals’ performances generated using AI.  The bill, however, exempts from liability certain AI replicas: (1) used as part of a news, public affairs, or sports broadcast or report; (2) used as part of a documentary, docudrama, or historical or biographical work; (3) used as part of scholarship, satire, or parody; and (4) where the use of the AI replica is de minimis or incidental. 
• The FCC’s Media Bureau proposed a $ 13,000 fine against the licensee of two TV translator stations for failing to timely file license applications for the translators and operating the stations without authorization after their construction permits had expired.  The translators’ licensee admitted that, due to a misunderstanding with its former consulting engineer, it failed to file license applications for the translators when their construction was completed, and it continued operating the translators after their construction permits had expired.  The FCC’s rules normally require a base fine of $ 3,000 for failing to timely file a license application, and a base fine of $ 10,000 for operating a station without proper authorization.  In this case, however, the Bureau reduced the proposed fine from $ 13,000 to $ 6,500 for each station because TV translator stations are secondary services.  Nevertheless, the Bureau noted that while other TV translators were previously fined only $ 3,500 for similar violations, a greater fine of $ 6,500 was warranted here because the translators engaged in unauthorized operations for far longer than in the previous cases.  Finally, the Bureau reinstated the translators’ construction permits (thereby enabling their license applications to be granted) based upon the Bureau’s practice of reinstating permits when a licensee has failed to timely file a license application for a station but clearly completed construction of the station before the station’s permit had expired.

While this week was light on regulatory activity at the FCC, the Commission is slated to consider a draft order next week at its October 19 Open Meeting.  If the order is adopted, the FCC’s audio description requirements would expand to commercial broadcast television stations affiliated with one of the top four television broadcast networks (i.e., ABC, CBS, Fox, and NBC) in Designated Market Areas (DMAs) 101 through 210 at a rate of 10 additional DMAs per year.  We’ll provide more information on that item next week.

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