Media Bureau Didn't Know About Record-Setting Cumulus Enforcement Action Until the Day Before
The FCC Media Bureau didn't know about the largest single-station sponsorship identification enforcement action in the commission's history until the day before the Enforcement Bureau announced it (see 1601070060), said MB Policy Division Assistant Chief Robert Baker, the agency's expert on political advertising rules, of the $540,000 consent decree with Cumulus. Panelists at a Monday FCBA CLE on political ads discussed new online political file rules, ad rate regulations and the current presidential race. The Media Bureau received numerous inquiries from broadcast attorneys concerned about receiving similar violation notices after Cumulus, Baker said. But he said he believes it was a "wild card" rather than an indication of how the FCC will treat sponsorship ID violations going forward.
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An Enforcement Bureau spokesman declined to comment on whether it was normal procedure not to involve the relevant bureau until late in the enforcement action process, but said the case was a continuation of enforcement of FCC policies on sponsorship ID. Though the FCC itself called the enforcement action the largest amount a single station had paid for a sponsorship ID violation when it announced the consent decree, the spokesman said it was similar to civil penalties against other broadcasters. The largest of the penalties pointed out by the spokesman was $115,000 against Journal Broadcast for 27 violations. Cumulus broadcast its offending ad 178 times, according to the FCC.
The most common questions broadcasters are asking the FCC about political ads during the run-up to the 2016 election are about political ads that are broadcast and then end up on a station's digital stream, and the requirements for a person to be considered a candidate for president and thus eligible for rights such as equal time, Baker said. Unlike previous election cycles, there have been few questions this time about the lowest unit charged rule, which controls how much a station can charge a candidate for ad time immediately before an election, he said. This is likely due to the sheer volume of money involved in this election, said Baker. He believes campaigns aren't challenging the broadcaster rates.
To be eligible for the equal time rule and other rights afforded presidential candidates, campaigns have to make a showing they're legitimately running for president, Baker said. Generally, this is accomplished by showing that a candidate has campaign offices in primary states or is holding campaign events, Baker said. But early in the current presidential campaign, the Policy Division was concerned that Democratic candidate Larry Lessig might try to argue that his largely online-based campaign constituted a similar showing, Baker said. If an online presence can be used to qualify for the rights broadcasters have to afford presidential candidates, the commission could see thousands of people arguing they're entitled to those rights, Baker said. Lessig ended his campaign (see 1511020039) before the issue had to be explored, but Baker said he expects the matter to be raised again.
Broadcaster concerns about sponsorship ID violations were also raised by complaints (see 1410060041) by Common Cause and Campaign Legal Center, said NAB Associate General Counsel Ann Bobeck. Those filings argue that FCC rules requiring broadcasters to use "reasonable diligence" to determine the funding behind political ads can be interpreted to mean that it's not sufficient to disclose just the name of the political action committee paying for an ad, said Eric Null, an attorney with the Georgetown Law Institute for Public Representation, who represents the transparency groups. Where such PACs are funded primarily by one donor, the broadcasters should have to ID the ad as being funded by that donor, not the PAC, Null said.
That goes beyond what should be expected of broadcasters under the regulations, said Bobeck: "We are not the long arm of the law." Since PACs report their funding only twice a year, broadcasters that use those disclosures to pin an ad on an individual donor could be using outdated information, leading to an incorrect sponsorship ID and vulnerability to litigation, said industry lawyer Brad Deutsch of Garvey Schubert.
If the FCC believes broadcasters should be required to dig further into the sponsorship of political ads, the agency should change its policy through a rulemaking, Bobeck said. The interpretation of the rules suggested by the transparency groups would be "a radical shift" that should require notice and comment periods, she said. Though she disagreed with the complaints, Bobeck said they caused many broadcasters to examine and update sponsorship ID and political file procedures, which she conceded was positive.
If the FCC had instituted its online public file rules for radio and pay TV (see 1601280057) sooner, NAB might have been able to create an all-online filing process for broadcasters to use during the current election cycle, said Bobeck. Though the rules have now been approved, it's not clear how long it will take for them to go through the Office of Management and the Budget approval process, she said. It can take a long time for new FCC filing methods and forms to be widely adopted in broadcasting, so it's likely too late for NAB to introduce a new system for filing political ad information in this election cycle, Bobeck said.